To preserve Lac La Biche County’ s split tax rates, municipal officials are considering changing the County’ s status from municipal district to specialized municipality.
To preserve Lac La Biche County’ s split tax rates, municipal officials are considering changing the County’ s status from municipal district to specialized municipality.
The name Lac La Biche County wouldn’ t change, but the new status would mean special considerations that reaffirm the municipality’ s divided taxation model.
Mayor Omer Moghrabi says the change in status wouldn’ t mean any grand transformation. The County already has all of the characteristics of a specialized municipality, but Alberta Municipal Affairs hasn’ t classified it as such.
“We’ re already operating under those rules,” he said. “Basically, we just want to get it stamped.”
Changing the status is simply the most effective way to maintain the split mill rate indefinitely, he says.
The County has urban service areas that surround the hamlets of Lac La Biche and Plamondon. Non-residential properties located in those areas are taxed at a lower rate than similar properties outside of them.
The split mill rate is not a common arrangement in Alberta, but it’ s allowed the County to bring in higher revenues from taxes on large industrial developments while smaller commercial properties in the hamlets don’ t have to pay as much.
According to municipal spokesperson Julie MacIsaac, the split mill rate is advantageous for local small businesses because it means they can be treated differently from their larger industrial cousins.
“It allows the County to set a lower municipal tax rate for businesses within the County’ s urban service centres, instead of one uniform non-residential tax rate for all businesses within the County,” she said.
A similar arrangement exists in the Regional Municipality of Wood Buffalo.
The problem is that the regulations allowing that local tax split, which were agreed upon between the County and the province as part of a land swap deal in 2012, have an expiry date in June of 2017.
When the matter was discussed in a regular County Council meeting last Tuesday, senior manager of finance and community services Dan Small said it’ s not guaranteed the property tax regulation won’ t be renewed in 2017, but Councillor MJ Siebold says the uncertainty means the status change should still be seriously considered.
“You have that dangling over your head and, depending on the whim of the province, you don’ t know if you’ ll be allowed to continue with that,” she said.
As a specialized municipality, urban service areas would become a permanent aspect of the County’ s municipal structure. Fort McMurray and Sherwood Park are examples of urban service areas located within specialized municipalities.
The current urban service areas in this municipality are centred around Lac La Biche and Plamondon. The bigger of the two encloses a large area, stretching from the Sentinel Industrial Park to the eastern end of Lakeland Drive and beyond.
Some small business owners whose enterprises are just outside the urban service areas want to be on the inside, and have asked for the boundaries to be adjusted accordingly.
County administrators have been asked to bring forward details on the possible financial impacts of changing the boundaries, while addressing the reality that more businesses within the urban service areas could mean fewer tax dollars coming in from the rural districts.
Information on that and the ramifications of officially changing the municipality’ s status should be presented at later meetings.
The process for changing municipal status can be lengthy. Public consultation needs to take place before Alberta Municipal Affairs will forward the proposal to the provincial government for consideration. A plan for gathering feedback from the public is in the works.
