Rural Alberta Chose Jason Kenney; Now He's Telling Them To Eat $173 Million In Unpaid Oil Taxes

Rural Alberta belongs to Premier Jason Kenney, or at least according to the results of the last election. His United Conservative Party won every single seat in communities smaller than Lethbridge when they swept to power last April. Kenney helped accomplish this by carefully crafting his public persona as a pickup-driving regular guy, battling the Ottawa elite on behalf of everyday Albertans. But actions speak louder than words, and rural Albertans have good reason to question who exactly their pugnacious premier is really fighting for. Last week Kenney told towns they may have to eat $173 million in unpaid taxes from oil and gas companies — an amount doubled since last year — because they can’t expect to get “money from a stone.” What does it mean when the premier says companies who’ve made billions off Albertans’ resources have turned to stone?

Consider the ballooning problem of abandoned wells, which grows worse every year. Oil companies are washing their hands of formerly profitable drill sites and leaving landowners and municipalities holding the bag. Almost 100,000 orphaned or inactive oil and gas wells require reclamation at an estimated cost of $30 billion. The “world-class” Alberta Energy Regulator — funded by the very industry they are tasked with overseeing — have secured less than one per cent of this amount. Instead of getting on with this important cleanup work, many of the companies responsible for the growing mess are now choosing not to pay their local taxes — with the apparent blessing of the premier.

Cash-strapped local governments are frustrated by the lack of legal mechanisms to go after delinquent oil and gas companies, most of which are still in business. Ponoka County Reeve Paul McLauchlin told the Canadian Press, “My personal opinion is that this is a tax revolt. [Oil and gas companies] are using this as a lever to decrease their assessment and change those costs.” Not only has Kenney clearly telegraphed to companies that they need not pay their municipal taxes, his government appears to be signalling that even more assessment giveaways could be forthcoming for his favourite industry — on the backs of local governments.

Last year the Kenney government slashed property tax assessments for shallow gas producers by 35 per cent. The province offset local tax shortfalls in 2019, but this year Alberta’s small towns are expected to absorb the $20-million gift to the petroleum sector. Unlike higher branches of government that can run rolling deficits, local governments in Alberta are required by law to balance the books, no matter what budgetary indignities are imposed by the province.

EDIT

https://thetyee.ca/Analysis/2020/01/28/Jason-Kenney-Betrayed-Rural-Albertans-Turned-To-Stone/