County waiting on others before committing to gas well plan
By COLLIN GALLANT on October 3, 2019.
cgallant@medicinehatnews.com
DUNMORE
Cypress County councillors declined to vote on taking part in a provincially funded shallow gas well tax abatement strategy until it can potentially align action with other rural councils around Alberta.
“There needs to be a lot more discussion about this,” Reeve Dan Hamilton told Tuesday’s council meeting in Dunmore.
Council members voted 9-0 to table the item until mid-October, at which point a decision to extend the program to locally operating companies before county taxes are due will be required.
This summer the Ministry of Municipal Affairs announced it would provide $23 million to counties in order for them to forgive the education portion of local property tax bills for qualifying gas companies.
Ministry officials repeatedly pointed to the stress in the industry, saying the measure offers quick, one-time relief before a larger re-evaluation is done on how legacy wells that are traditionally high-cost, low-production are assessed for tax purposes.
The same wells make up a substantial amount of tax revenue – 10 per cent in Cypress County’s case – and rural politicians across Alberta have stated concern about potential ramifications.
In August, administrators from the 15 most-affected counties met to share information and discuss strategy.
A summary of the meeting provided by the Rural Municipalities Association, and obtained by the News, outlines concerns that the program favours one particular sector of business community and others could lobby for similar changes.
It concludes that the feeling is that the program “scapegoats municipalities for an industry’s struggles that are far beyond any municipality’s control.”
On Tuesday in Dunmore local councillors stated they hoped to find out more about how other counties were approaching the program, and whether the issue could be added to the RMA’s fall convention in mid-November.
Administrators stated that a decision is needed soon. The provincial program requires that counties apply by an Oct. 21 deadline.
In the current program, the $23 million from the province’s general revenue would leave county’s whole after the cancellations.
Cypress County, with nearly 21,500 qualifying wells, would receive the largest amount in the program, according to early analysis by the counties involved.
The County of Newell passed the resolution in late September with documents stating that of the $3.4 million total, $2.4 million related to wells and $1 million to pipelines.
The Special Areas Board is listed with 8,100 wells, and 12 other counties and municipal districts have between 300 and 4,000 wells each.
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