New Alberta working group to tackle problem of $253M in unpaid oil and gas property taxes

The Alberta government and the Rural Municipalities Association (RMA) are forming a working group to try to solve the issue of unpaid property taxes owed by oil and gas companies and collect what has now amounted to at least $253 million.

The Property Tax Accountability Strategy working group was announced by the province in a news release Monday, saying work may include closing loopholes and establishing stronger partnerships and communication between the energy industry, rural municipalities and government.

"Whether you like it or not, you have to pay your taxes. We're committed to working with our municipal partners to ensure that bad actors in the oil and gas industry are held to account, and that municipalities are paid the property taxes they are due," Municipal Affairs Minister Ric McIver said in the release.

The president of the RMA, Kara Westerlund, says it's a huge problem resulting in rural communities getting shorted millions of dollars in property taxes that's earmarked for key infrastructure projects.

"I'm not talking about swimming pools or the nice-to-haves; I'm talking about wastewater facilities, culverts, bridges, vital road infrastructure to allow us to get products to market," said Westerlund. 

And she says these aren't just insolvent or bankrupt companies that aren't paying their taxes. She says $100 million of the $253 million owed is from companies that are still operating.

Westerlund says it's not clear if any industry representatives will participate, but she's hopeful there will be.

"We're not talking all of industry, for the most part ... we're talking about a handful that continue to, I guess, to play outside of the rules and not to be good stewards in their communities," said Westerlund.

In an email to CBC News, the office of the minister of energy and minerals says most oil and gas companies pay their municipal taxes, noting about $1.5 billion was paid by energy companies in 2023.

The email from Brian Jean's office also states: "We are looking at every tool to ensure delinquent companies pay their municipal taxes including increasing the consequences for not paying them."

Westerlund says she already has some ideas to pitch to the group, such as suspending operating licenses or not allowing them to be transferred to another business, until taxes are paid.

Other municipal leaders say they agree there needs to be some drastic solutions put forward.

"I've talked to a lot of energy ministers. I've talked to a lot of different premiers. Everybody acknowledged it's been a problem, but everybody's really hesitant to do too much about it,"  said Vulcan County Reeve Jason Schneider.

For more than a decade, municipalities have been calling on the province to help them collect unpaid taxes.