Alberta municipalities are being put in an even tougher position in the latest battle between the provincial and federal governments.
The provincial government issued its latest shot across the bow of the federal government, with new legislation potentially coming in place that would give the province power to halt any agreement between municipalities and the feds.
The UCP government has introduced Bill 18 – the Provincial Priorities Act – for future debate in the legislature.
But with the Conservative government holding a majority, the bill is all but signed, sealed and delivered other than going through the motions.
Public engagement is expected to take place this summer and the province has said, if passed, it wouldn’t be retroactive to existing agreements.
The bill will require the province to give the thumbs up for any deal reached between the federal government and Alberta municipalities.
Premier Danielle Smith has said the province is “taking back control,” which will in turn help align federal funding with Alberta government-approved policies and priorities.
Provincial housing minister Jason Nixon has said “beware of feds bringing gifts with strings attached” and “Alberta will not be bribed by Ottawa with our own money” in the federal government negotiating directly with municipalities.
In the lead-up to the bill, all municipalities had to report to the province existing agreements between them and the federal government. Roughly 14,000 agreements are in place – with non-Calgary and -Edmonton municipalities averaging about five to eight – and about 800 called “problematic”.
The bill also rings alarm bells for its potential impact on post-secondary research, which academia unions have said could bring in a politicization of university and college research.
The University of Alberta, for example, received $140 million in federal funding in 2021-22, meaning the provincial government would have to give the OK before the school gets money through various federal ministries.
It could also impact Crown-controlled organizations, school boards, health authorities and other public agencies, which would cause a significant change to the status quo.
The City of Calgary has stated they’ll continue to work with the federal government, with infrastructure funding from the province long falling short of municipal needs. Mayor Jyoti Gondek highlighted “there’s money on the table right now.”
The federal budget emphasized its priority of housing in the coming years.
Though the pre-budget announcements took on an election campaign-style format, many of the plans will slowly make an impact on the creation of housing.
With the federal government having announced billions available for infrastructure and housing needs, it could be asking municipalities to pick between one parent or the other in a divorce.
The money announced by the federal government for infrastructure is badly needed by municipalities, which have long argued and rightly noted the significant shortfalls provided by upper government levels. It ultimately means the share of the tax burden is handled by local taxpayers.
Alberta municipalities have long clamoured for more infrastructure funding, with the latest battle being over the vast shortfall of the newly established Local Government Fiscal Framework.
Under former Prime Minister Jean Chrétien and his Finance Minister Paul Martin, the federal government downloaded anything and everything to balance its budget in the mid-1990s. In a few short years, the downloading had been complete, the budget balanced and the federal government had largely wiped its hands clean of many responsibilities.
Since then, provincial governments have followed the same game plan in handing off responsibilities to municipalities. However, they sit at the bottom of the ladder and have no one to hand off responsibilities to and are left footing the bill.
The latest federal budget and the billions of dollars being made for housing and infrastructure emphasize the feds are back in the business of housing. Prime Minister Justin Trudeau noted he and his government had been heavily criticized by provincial governments for not supporting housing.
He added the feds had heard they needed to step up to “fix the housing crisis” and “the provinces should be careful what they wish for” in the federal government supporting housing at the municipal level.
Like it or not, municipalities fall under the jurisdiction of their respective provinces. The British North America Act of 1867 and its updated Constitutional Act of 1982 outline that municipalities are ultimately the playthings of provincial governments.
But if provincial governments are going to decry municipalities for chasing after federal dollars when the province denies similar funding, provinces either need to give more support or allow municipalities to find necessary funding.
