County's ICF Deal with the Town of Mayerthorpe Proves Elusive
After two years of earnest efforts to find common ground with the Town of Mayerthorpe – and mere months away from the provincially-mandated deadline for such initiatives – a fundamental rift in fiscal policy threatens to derail the entire process. Simply put, Lac Ste. Anne County finds the Town’s arbitrary expectations of financial support unwarranted; unsustainable; irresponsible; and unnecessarily burdensome on the County and its ratepayers.
ICF Completion Deadline has Passed
At risk is the County’s final Intermunicipal Collaboration Framework, or ICF for short. ICFs are mandated by the Province as a way for neighbouring municipalities to share knowledge, combine resources and do more with less. All municipalities need to structure ICFs with their bordering neighbours, and the deadline for doing so was April 1, 2021.
Following 19 successful ICF outcomes with all other adjacent municipalities (18 completed and one pending), the sole outlier in the County’s good-faith efforts to collaborate with its municipal neighbours is the Town of Mayerthorpe. It should also be noted that Mayerthorpe is the one and only municipality that has attached a financial stipulation to its ICF negotiations.
The key points of the County's impasse with the Town of Mayerthorpe are as follows:
Mayerthorpe is the County’s only remaining municipal neighbour without an ICF at or near completion.
To satisfy Mayerthorpe’s conditions for the ICF, the County would have to pay considerably more for the Town’s recreation facilities.
Failure to enter into an ICF by April 1, 2021 may force the Town and County into binding arbitration, which generally results in a matter being split down the middle to appear equitable.
Splitting the matter down the middle represents considerable financial gain for Mayerthorpe, and a stark loss to the County.
The County’s loss will mean less funding to more than 150 other local organizations, service reductions, a tax increase for County ratepayers, and a diminished capacity for the County to determine its own future.
It defies logic to suggest that the cost structure for Town facilities like the Aquatic Centre has increased several fold. This is the same swimming pool that existed last year and the year before. Regardless, it is wrong-headed for any municipality to think that the County should adjust its own tax rate to absorb that municipality’s shortfalls.
“The Town expects us to increase OUR taxes during a time of financial hardship so that THEY can benefit from increased funding,” stated Lac Ste. Anne County Reeve Joe Blakeman. “Such a complete abdication of responsibility is appalling, and underscores just how differently our two leadership teams view the present realities of Rural Alberta.”
Fundamental Differences in Fiscal Policy
The County continues to weather a perfect storm of continued economic downturn; provincial cost downloading and assessment model changes; uncollectable linear tax revenue; diminishing funding resources; and the financial impacts of COVID-19. As a result of these events, the County anticipates a total financial impact in excess of $1,500,000 or approximately 5% of its operating budget.
County Council and administration have worked together to make difficult financial decisions in support of fiscal responsibility. These decisions include no changes to the County’s salary structure, and a tax increase for 2021 as close to 0.0% as possible. In parallel to this lean and sustainable business model, County residents continue to provide hundreds of thousands of dollars in broad financial support to a spectrum of vital recreational, cultural and social programs and services throughout the region.
“In this time of unprecedented financial strain and austerity, the last thing we would do is further burden our ratepayers,” shared Reeve Blakeman. “It is unfortunate that Mayerthorpe is experiencing viability difficulties, but when their solution is to shift its financial challenges onto the County, we’re going to have a problem. This is just not right, and it will be to the detriment of everyone in the region…except perhaps Mayerthorpe in the short term.”
“Transferring your financial burden onto your next-door neighbour is certainly not the spirit of the ICF,” he continued. “From Council’s perspective, Mayerthorpe has two options: accept the substantial financial funding provided to the Town and start to manage your affairs responsibly, or we say enough is enough and have a different conversation. If our administrations cannot see eye-to-eye on the fundamentals of sound governance, then perhaps it’s time to talk about a single administration.”
The Municipal Government Act allows for the amalgamation of two municipalities as a solution for creating long-term sustainable communities. Among other potential benefits, amalgamation could save money, provide more expertise, resolve intractable issues, reduce taxes, and give municipalities a stronger voice.
“If a municipality wants us to be their bank, then so be it,” muses Reeve Blakeman. “But what does the bank do when you can’t pay your mortgage? I think we all know the answer to this question.”
Lac Ste. Anne County acknowledges the positive and participatory process it has experienced when working with the vast majority of its neighbours throughout the ICF process. Agreements are now in place with all bordering municipalities – with the unfortunate exception of the Town of Mayerthorpe.