There is a new program available to assist municipalities in dealing with insolvent oil and gas companies.
County of Barrhead CAO Debbie Oyarzun informed council of the Provincial Education Requisition Credit (PERC) program Dec. 5 and says it is a credit that covers the uncollected educational portion of tax requisitions. The program was unveiled at the November convention of the Alberta Association of Municipal Districts &Counties (AAMD&C).
“PERC is the province’s recognition of the numerous e-mails, letters and advocacy attempts on helping municipalities deal with uncollectable taxes,” Oyarzun said, adding municipalities province-wide have delinquent oil and gas company accounts.
“We can’t collect taxes and yet the municipality is still required, based on the assessment of the property, adequate education taxes, as well as social housing taxes. That comes out of our taxpayers pockets. The government heard the advocacy efforts and this is a temporary solution to address the issue. “
PERC allows municipalities like the county to receive a credit in the value of the uncollectable education portion of the taxes.
“These companies are still getting assessed and we aren’t able to write them off yet but that’s what this program is about. It is retroactive to the 2015 tax year and extends to the 2019 tax year. The scary piece is that in the fine print it does say it is subject to available funds. I’ve been in discussions with my colleagues and I understand there are some municipalities that are talking millions in uncollected taxes,” she said, adding the annual fund has a limit of $10 million available for the purpose.
The deadline for 2015/2016 is Jan. 15, 2018.
“We have three companies for those two years that are currently eligible, because they were previously written off. They represent a $24,878.81 credit for the county through this program,” she said.
On a question from Coun. Walter Preugschas as to why the 2017 tax year was not included in the Jan. 15 deadline, Oyarzun explained that the province uses the end of October as their cut-off criteria for deeming companies insolvent or uncollectable.
“We do have two additional companies that we cannot collect taxes from and we didn’t get notification for them until the end of November, so we weren’t able to include them in this application,” Oyarzun said, adding the new companies would be dealt with by council in 2018.
