Rural Municipalities of Alberta call for government action on unpaid oil and gas property taxes

While the government has tried to address this issue, the RMA says the most recent survey findings indicate more effective measures are needed as rural municipalities are shouldering a growing financial burden.

“Year after year, rural municipalities present clear, documented, and verifiable evidence that oil and gas companies are willfully avoiding their property tax responsibilities,” said RMA’s president Kara Westerlund.

“Yet, year after year, this issue persists due to a lack of proper industry regulation and accountability. While other property owners across the province face stringent penalties for non-payment, oil and gas companies continue to take advantage of legislative and policy gaps.”

She added the government needs to dedicate time and resources to solving the issue rather than merely tweaking the system.

The RMA said it’s a complex issue requiring collaboration from municipal, provincial and industry stakeholders.

Through a collaborative working group, a property tax accountability strategy could be developed to close legislative enforcement gaps and ensure industry accountability.

The goal would be for the group to produce a joint report with actionable recommendations and strategies to recover unpaid taxes and restore a strong partnership between the industry and rural municipalities.

The RMA said that Municipal Affairs Minister Ric McIver and Energy Minister Brian Jean have indicated willingness to collaborate with RMA to form a in the coming months.

“As we work to address the ongoing issue of unpaid oil and gas taxes, a collaborative approach between government and municipal stakeholders is essential,” Westerlund said.

“By coming together with key partners, including the provincial government, industry, and other relevant stakeholders, we can develop practical, effective solutions that not only recover unpaid taxes but also ensure accountability and long-term sustainability for all of Alberta’s municipalities.”

Previous attempts to address the issue have included enhancing municipal lien powers, restricting companies with signficant arrears from receiving new well licenses and developing a framework for municipalities to report unpaid taxes for enforcement.

RMA data suggests these efforts have been ineffective, with taxes owed rising to $67.8 million as of the 2024 fiscal year, up from $42.9 million in 2023.

This year, the RMA survey gathered data from members on specific companies, finding the top ten “worst offending” companies to be collectively owing $67.3 million in unpaid property taxes to 38 municipalities.

The top offender, on its own, reportedly accounts for more than $27 million in due taxes across 19 municipalities. Altogether, members identified over 200 companies with unpaid property taxes.

“This problem is widespread, with responsibility falling on companies across the industry and impacting municipalities on a significant scale,” Westerlund said.

“It is crucial that we recognize the scope of this challenge; it is a systemic problem with how the industry is regulated and held accountable that requires immediate attention and collaborative action to resolve.”

A full report of the survey results is availabe online.

by rdnewsNOW Staff

Rural Municipalities of Alberta call for government action on unpaid oil and gas property taxes

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