Christmas has come early for three urban municipalities surrounding the MD of Bonnyville, with council launching a pilot project to compensate them for their infrastructure usage by MD residents.
A sum of $5 million has been set aside by MD council in the interim budget to be distributed between the Village of Glendon, the Town of Bonnyville and the City of Cold Lake as part of the Inter-Municipal Cooperation program (IMC).
Under the formula used by the MD to calculate how much each municipality receives, which is based on equalizing the assessment per capita, Bonnyville will receive the lion's share at $3.84 million, Glendon will receive $513,360 and Cold Lake will get $645,800.
Bonnyville Mayor Gene Sobolewski was pleased to hear that council had approved the program and said that the town can use the funds for joint-interest projects such as construction on 34th Street and 6th Street and resurfacing Gurneyville Road.
“I think it's a very fair way of examining the issue and moving forward, I wish the province would adopt something like that.”
Funding is based on splitting the balance of the money by dividing the MD population in each urban service area by the total MD population. Using data collected through surveys, license plates and other sources, the MD estimates 18.9 per cent of its residents use facilities such as arenas and field houses in Cold Lake, 47.5 per cent use Bonnyville's facilities and 72.1 per cent use Glendon's facilities.
“It kind of gets them on the same playing field so they're all able to provide some basic services, that's part of the issue with some of the smaller (communities) is that we can give the money conditionally but they can't afford to use it, so by doing this it kind of brings them all up so they can all hopefully afford to do some things,” said Gordon Fullerton, director of finance with the MD of Bonnyville.
Equalizing the assessment per capita will help to ensure that each municipality has a base level of funding to provide services, and funding the projects based on the MD's population percentage in each service area will provide more equitable funding between the municipalities, according to the MD.
“I didn't know that the MD of Bonnyville was working on something like this, we're happy with the purpose of the funding,” said Cold Lake Mayor Craig Copeland. “This will help with the cost of recreation in Cold Lake, so we're pretty happy with the MD of Bonnyville recognizing that residents utilize our facilities.”
He added, “Bringing rural and urban into working together is the future and so maybe this is a baby step in terms of the future and I think we all need to come together and I would look at this as just the start of sharing the revenue.”
There are, however, caveats to the funding. Seventy per cent of funding for each municipality will be allocated for capital projects and the remaining 30 per cent comes under operating funds. The minimum funding shall be no less than $200 per capita for the MD population in each urban service area. In case the minimum funding applies, the money will be allocated as operating funds under this program.
As Cold Lake's assessment is significantly higher than the other two municipalities, it does not qualify to receive any capital funding under the program, only operating funds.
“We have no problem in not being involved in this formula for capital for those other things, we're in good shape and our assessment per capita now with the ID 349 is very good and we're a sustainable community,” Copeland explained.
The city plans to redo its budget in order to incorporate the additional dollars from the program, which Copeland said will go into decreasing an approximately $4 million deficit in operating recreation in Cold Lake.
For Glendon and Bonnyville, the MD will fund capital services such as roads, water and sewer based on its service area population in the municipality. For example, Glendon will be required to fund approximately 28 per cent of a capital project because the MD classifies 72.1 per cent of its residents use Glendon as an urban service area. By the same token, Bonnyville will be required to fund 52.5 per cent of a capital project.
“We have very aging infrastructure for water, our waterlines are very old and it's very expensive to start replacing it, so now we have a chance that we can actually start fixing this stuff,” said Glendon Mayor Laura Papirny. “It's definitely showing regional collaboration and it means a lot to us for our sustainability, we have a tight budget so this absolutely helps.”
As per the program, a municipality that doesn't use its funding can put aside capital funds for a maximum period of three years to fund a bigger project. The MD may cancel the funding at anytime but unused funds would remain available until the carryover period has lapsed.
Funding under the IMC will be reduced by the funding provided under some existing programs. This includes the Regional Community Development Agreement (RCDA), Bonnyville Centennial Centre funding, and airport funding. In Bonnyville's case, the net total funding after docking RCDA and C2 grants is around $1.8 million.
For capital funds, municipalities will have to apply in writing on a project basis. The MD will pay either 50 per cent of the maximum project funding available or 50 per cent of the tender price, whichever is lower. The balance will be paid out upon receipt of a statutory declaration as to the project costs incurred. Fifty per cent of operating funds will be paid by Feb. 15 each year and the balance by Sep. 30.
“We've always said we want to cooperate with our neighbouring municipalities but further to that we need to dedicate some dollars from the linear assessment,” said Reeve Ed Rondeau. “It is a bit of a pilot project, we will see how it works in year one and if it creates more hassles than it creates goodwill then of course it's going to be re-looked at and revamped.”
Population figures for assessing funding were taken from the 2011 federal census. The figures are subject to change with an upcoming census in 2016. The IMC will come into effect in 2016.
