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By Troy Gillard and Sheldon Spackman

city finances pounded by pandemic

Red Deer welcomes badly needed provincial and federal financial support: Veer

Jul 29, 2020 | 9:06 AM

Red Deer’s mayor is welcoming news that other levels of government are shoring up support of over $1 billion for Alberta’s municipalities during the COVID-19 pandemic.

However, Tara Veer it’s not yet known how much money Red Deer will receive through the initiative announced by the provincial government on Tuesday.

“It’s always welcome news for municipalities when the federal and provincial governments make provision of additional dollars for municipalities,” says Veer. “Earlier in the pandemic, we were expecting a capital infrastructure investment, recognizing that would be part of an economic stimulus package. But the fact there is operating dollars coming as well, will provide significant financial relief.”

The province is providing municipalities with $500 million in additional funding to build shovel-ready infrastructure projects starting in 2020, with the hopes of creating thousands of jobs as part of Alberta’s Recovery Plan.

“We’ve been asking for operating dollars for a number of months,” Veer notes. “So it’s welcome news today in principle, and we look forward to hopefully having a significant off-set on our municipal budget in the coming weeks.”

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The nearly 30 per cent boost to municipal infrastructure funding is anticipated to create an estimated 2,500 jobs from projects that will begin construction in 2020 or 2021. Government officials say municipalities and Metis settlements may begin applying for funding to build roads, bridges, water and wastewater treatment plants, and other important infrastructure that would not have been built in 2020 or 2021 without the stimulus.

Alberta will match $233 million in federal funding to support municipal operating costs during the pandemic and $70 million to support public transit operating costs – for a total of $606 million under the Safe Restart Agreement.

Veer admits Red Deer’s operating budget has faced the most pressure from the pandemic.

She says the full impact won’t be known until the fall when final tax payment deadlines arrive.

“But the fact that the federal government and provincial government were able to strike a deal with respect to operating dollars, it will help,” she explains.

“Earlier this summer when council had extended the line of credit by $10 million, our hope was not to have to draw down that line of credit at all. But of course we had to be realistic about the fact that there are a lot of unknowns and we by necessity, had to approve that line of credit.”

The additional money for public transit is another aspect Veer is happy to see.

“Public transit has very high fixed costs, and is one of the most heavily subsidized areas of City operations,” adds Veer. “Ridership is still down as a result of the pandemic, so there has been significant revenue loss there. So I was pleased there was a specific recognition of the unique challenges that public transit costs are causing for municipalities that have transit systems.”

Veer says it’ll also be a few more weeks until they have a full sense of how the pandemic has affected the local business community.

“We really won’t have a sense of net business or overall assessment loss until we hit Stage 3 of the province’s relaunch plan. While our hope is that we wouldn’t see wide-scale business loss in the community, we do know that unfortunately, there will be some businesses that are finding themselves in a position of not re-opening.”