RED DEER - The City of Red Deer will be seeing some changes in funding following the release of the provincial budget on Thursday.

The province is changing it's Municipal Sustainability Initiative, which is the main money source for Red Deer's capital infrastructure. While no changes will be made this year, a nine per cent reduction can be expected in 2020.

"The City of Red Deer in the budget that city administration tabled last week anticipated about this level of capital grant reduction," said Red Deer Mayor Tara Veer.

Another funding shortfall will be to the Grants in Lieu program. The grants are offered instead of having the province paying property taxes for provincial buildings. Red Deer will see 25 per cent cut in 2019-2020 and a further reduction of 25 per cent for the year after.

The province also proposed creating legislation called the Local Government Fiscal Framework, which Red Deer city officials are excited about.

"I think that this is good news in the sense that it will legislate municipal capital grant funding. Municipalities have had uncertainty and a level of insecurity in recent years not knowing the future of the MSI program. Certainly legislating the fiscal framework, answers the call particularly that mid-sized urban municipalities have had for many years," said Veer.


Health funding

One project many Red Deerians were paying close attention to was the hospital. No funding has been allocated for the building's expansion, but $1 million was set aside for continued planning, even though the previous provincial budget tabled by the NDP also allocated money for planning of the hospital.

"It is my understanding that the scope of that planning did not include the details and the phasing that treasury needed in order to approve a measured infrastructure expansion at the hospital and phasing of that," said Veer.

She added while they were disappointed by the lack of funding, she was not surprised and understands the provinces need for more information.

"It is welcomed news that in this budget there is a million dollars in additional funding to look at the needs and options for a phased implementation of the infrastructure expansion," said Veer. "If we weren't getting indications that there was at least support in principal for those projects, then I think our response would be very different. Obviously at some point we need to see some action on these particular files."


Social programs

Another area of disappointment was no funding being announced for a 24/7 Homeless Shelter.

"We thought that the shelter would be a fairly quick win in what was an austerity budget. In the scope of the budget it's a fairly nominal sum, in the scope of a provincial capital plan. Having said that though, we certainly recognize they may need further information so they know what they're funding," said Veer.

The mayor expressed confidence that the shelter will be included in the next budget.


Corporate taxes

One piece of welcomed news for Red Deer was the Job Creation Tax Cut. This will reduce corporate tax rates from 12 to eight per cent by 2023.

"We do believe the corporate tax reduction will help stimulate local economic investment in the meantime. Until a pipeline is actually built and functional, we're hoping that the corporate tax reduction will help incent our local private sector," said Veer.

This cut has been publicly criticized by the NDP.



Red Deer College is also seeing some cuts, as most post-secondary institutions are. Around $3.3 million will be cut from the Campus Alberta Grant and the Infrastructure Maintenance Program.

The tuition cap was also lifted, and new RDC students can be expecting a tuition increase, by how much has yet to be determined.

One piece of good news for the college is that the transition to becoming a university is on track.

"Although this news is challenging for us, I firmly believe in our ability to work with all of our stake holders to successfully realize transformational change and continue on our journey to become a comprehensive regional teaching university," said Red Deer College President Dr. Peter Nunoda.

This will be a short budget period, with another financial plan expected in the Spring.