(City of Medicine Hat)

By Eli J. Ridder | @EliRidder

UPDATED

Scrapping MCAF utility charge could lead to 7% property tax increase, City of Medicine Hat says

Feb 1, 2024 | 7:00 AM

Property taxes could rise seven per cent if the City of Medicine Hat eliminates a utility charge the ratepayer association wants removed, a city spokesperson told CHAT News on Wednesday.

READ MORE: Medicine Hat ratepayer association slams MCAF, tax rate hike in town hall

The Medicine Hat Utilities Ratepayer Association has maintained it wants the charge, known as the municipal consent access fee, scrapped from resident utility bills.

Municipal consent access fees are commonly used by municipalities for third-party utility companies setting up shop on city-owned property. The utility then downloads the cost to customers to make up the money.

The MCAF in Medicine Hat provides the utility access to municipal land for power lines, electric substations, gas lines and gas compressor stations and is intended to cover municipal taxes that would have otherwise been collected on property and land used by the utility, the city said.

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“In Medicine Hat, the MCAF allows us to remain philosophically consistent with other jurisdictions across the province, where the municipality and the distribution business mutually agree to an MCAF as if they were two separate entities,” the spokesperson said.

The ratepayer association, known as MHURA, has argued that MCAF is separate from an ongoing third-party review of the public utility company COMCO.

In response to MHURA, Mayor Linnsie Clark said Wednesday the city is already working on the issue of utility charges, echoing a statement council gave in December.

“On this particular topic, we’ve heard the concerns in our community and have taken action by implementing interim measures and committing to a third-party review of our energy business,” Clark said.

The review’s conclusions are expected to come before city council at some point in 2024.

“We appreciate the public’s patience as we await the results of that review,” Clark added.

MHURA President Sounantha Boss, in a written statement to CHAT News late Wednesday, said there’s no reason for taxes to go up in response to the city.

“It it time for council to show empathy to Medicine Hat residents and reduce spending, taxes and fees,” Boss said.

“In addition, there is no need to increase our taxes at all. Use a portion of our unbudgeted mega profits earned on our utilities and invest it. The interest alone will make up the budget shortfall indefinitely.”