Mayor Sohi says Edmonton is being ‘shortchanged’ by province

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Edmonton’s mayor says if the Alberta government has concerns about the city’s finances the province should give them more money.

Mayor Amarjeet Sohi, in a letter to Premier Danielle Smith Tuesday, said the City of Edmonton is following financial rules and has an AA credit rating but the “lack of consistent and equitable support” from the provincial and federal governments is intensifying Edmonton’s financial pressures along with inflation, population growth and recovery from the COVID-19 pandemic. Smith told reporters last week her government is “on standby to help” at the city’s request, voicing unease with unspecified “serious financial challenges,” and stability in the municipality amid high turnover this year in city management.

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Sohi said “Edmonton is being shortchanged,” not getting its fair share “and that is where we will continue to push and demand equity.” Without the province’s help, he suggested even higher property taxes could be on the way.

In the letter, Sohi also called on the province to revisit the Local Government Fiscal Framework to cover municipalities’ infrastructure deficits, refund $2.2 million Edmonton paid for Alberta Health Service’s shigella response, review police funding models, resume paying for police DNA testing which costs Edmonton $5 million a year, and better fund emergency medical services because the gap costs Edmonton $28 million annually.

If the province really wants to help, Alberta can restore funding cut over decades worsening the city’s finances, the mayor said Tuesday. Giving Edmonton $60 million to cover the full cost of property taxes on federal buildings held back since 2019 would be a good start, he said.

“If the province steps up to pay their fair share of property taxes to Edmonton which amount to $60 million, that $60 million will be enough for us to eliminate our entire deficit,” Sohi told reporters. “What I’m asking for is not special treatment. We need equitable treatment.

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“This is not the making of the Danielle Smith government. They are willing to talk to us. I am very hopeful that this is an opportunity for the Danielle Smith government, for the premier and cabinet, to step up and show that they care about Edmonton.”

As of February, Edmonton was projecting about a $50 million deficit for 2023. City council will review these figures and plot a course of action during the spring budget update this month in public.

Smith “open-minded,” will review Edmonton’s requests

Alberta’s premier said her government will listen to the mayor’s requests and she’s asked Municipal Affairs Minister Ric McIver to work with the City of Edmonton.

Her preference, however, would be to review policies that affect all municipalities in Alberta.

“If there’s a holistic approach that we can take that would help more municipalities, that’s obviously what we would prefer to do. So I’ll listen to any of the recommendations and we’ll proceed with a measure of goodwill to try to figure out if we can find some long-term lasting solutions for them,” she told reporters Tuesday.

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Smith said she’s also open to reviewing things Edmonton may be paying for that a municipality shouldn’t be.

“If there are ways that we can take on some of the various services they’ve provided that aren’t in their jurisdiction that are in our jurisdiction, I’m open-minded about that as well,” she said, pointing to the province’s navigation centre for homeless people in Edmonton as an example.

Other Alberta municipalities struggling

Edmonton is not the only city facing financial challenges because of changes to provincial funding.

“Provincial cuts and downloading impact every municipality in Alberta, but are especially challenging in Edmonton,” Sohi said in a written statement Tuesday.

Ward Karhiio Coun. Keren Tang said Edmonton and other municipalities also have infrastructure deficits because of a lack of funding for years.

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She hopes the province takes a look at Edmonton and other cities and steps up to pay for services downloaded to municipalities.

“We keep inviting folks to move to Alberta and think everything will be OK, (but) if we don’t give communities the resources they need to maintain things, I don’t think we will get very far, and I would be very worried for the future of the province,” Tang said.

“I just think we need more provincial input and actually respond to the needs from the community as we have been raising this whole time.”

‘On standby to help’: Smith

On March 27, the premier told reporters she was concerned about the municipality’s finances and stability at city hall, saying she is “on standby to help” if the city requests support.

Edmonton Journal columnist David Staples revealed that morning the provincial government was considering taking steps to “audit and stabilize” the City of Edmonton.

Such a move would be unprecedented in Edmonton. Interventions by the provincial government into the workings of municipalities are extremely rare in Alberta’s history.

Responding to questions about those revelations, Smith told reporters later March 27 if the provincial government were to intervene it would not take such a step lightly and the city may be able to work out its own problems.

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“No one has stepped in, no one has intervened, no one is doing an audit, no one is taking any extraordinary measures, but if they need our help then we are ready and on standby to help,” Smith said at the time.

Alberta NDP Leader Rachel Notley called Smith’s suggestion a “campaign of fear and smear,” saying the UCP government has targeted city councils it disagrees with politically.

Seven top-ranking managers have left within a year, including the city manager most recently.

A city official previously told Postmedia that Edmonton lost $13.2 million in revenue in 2023, equivalent to a 0.7 per cent tax increase, because the Alberta government pulled back on paying grants in lieu of property taxes on its buildings in the capital city.

lboothby@postmedia.com

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