Tax revolt? Unpaid taxes from energy companies to Alberta towns more than double

Alberta’s rural municipalities say the amount of unpaid property taxes they’re owed by oil and gas companies has more than doubled over the past year.

The association says they are owed a total of $173 million — a 114 per cent increase over last spring.

“I think we need to work at it to try and come up with solutions so that the rest of taxpayers don’t have to carry the cost,” said Rural Municipalities of Alberta President Al Kemmere.

Kemmere does not blame all oil and gas companies, noting that some are very good at paying their dues, but also, there are challenges when they are owed money from companies that have gone under.

Years of low oil prices have left many small producers in dire straits.

But rural officials say recent court decisions have left them powerless to collect tax money owed them by financially troubled companies.

As well, they say the provincial government recently ended a program that refunded them money they lost by reducing taxes for certain kinds of wells.

Overall, Kemmere said it could have a significant impact on small towns in Alberta.

“We have some that this is 20 to 25 per cent of their budget. Nobody can afford to keep operating with that much of their income being vacated on them.”

Reeve Paul McLauchlin of Ponoka County, where unpaid taxes amount to about 10 per cent of overall revenues, suggests the non-payment amounts to a tax revolt by an industry looking to cut costs wherever it can.

He says some of those taxes are owed by companies that are still operating and viable.

The RMA also expressed concern about other provincial changes, such as adjusted police funding, which is also putting an increased burden on rural centres.

McLauchlin said he had not heard any constructive plans from the province, and Kemmere is holding out hope there is still room for negotiation on finding a solution.

“Just try and get them to realize the cumulative impact of all the changes that have taken place,” he said.

660 NEWS did receive a statement from Municipal Affairs Minister Kaycee Madu about the issue:

“Our government recognizes the impact this issue is having on rural communities, and we are working to identify potential tools that may help balance the interests of municipalities with the economic realities facing many employers since the 2014-15 downturn. As I said at the RMA convention in November, a conversation is underway within government on strategies to address this situation. I will be continuing conversations with the RMA on this as well, to ensure any tools we come up with strike the right balance. This issue is complex, particularly given some of the companies involved have long since gone out of business. Although we have taken immediate steps to provide industry and municipalities with short-term support in these difficult economic times, we know we cannot kick the can down the road.”

– With files from The Canadian Press

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