Community Revitalization Levy

In 2005, the MGA was amended to introduce a new financing tool for municipalities. It is a form of incremental tax financing and is referred to as a community revitalization levy (CRL). This levy was incorporated into Part 10, Division 4.1, and Section 381.1 of the MGA to aid municipalities to help accomplish infrastructure redevelopment.

What is a community revitalization levy?

A community revitalization levy (CRL) is a funding initiative that allows a municipality to redirect a portion of provincial tax revenues from a designated revitalization area and direct the revenues towards approved municipal expenditures in the specified area. The revenue that is redirected is a portion of the provincial (education) share of the property tax revenue. The approved expenditures must have a direct role in fostering redevelopment of the area and tend to be capital improvements and one-time investments. These municipal improvements encourage property owners to invest in their properties resulting in a renewal and revitalization of an existing area.

Incremental tax financing refers to a process that sets a benchmark assessment/taxation level and every tax dollar collected above the benchmark is redirected to fund targeted investments. In the case of CRL it takes any increase in the provincial school property tax revenue over the benchmark year and provides these funds to the municipality for a 20 year period. For example, if provincial school tax revenue for a property was $50 in the benchmark year and re-investment in the property occurs in a future year that increases the revenue to $75, then the added $25 would be available to the municipality.

The above system does not increase municipal taxes for the ratepayer. What changes is the jurisdiction that gets to use the funds. It is not a new tax and operates as a self-funding mechanism for revitalization efforts.

Before a municipality can create a community revitalization levy there is considerable amount of planning and preparatory work that must be completed. This process can take up to two years to complete.

The Town of Olds approached the development of a community revitalization levy with the community in mind. Identified as a CRL area was the Uptowne core that had been denoted in the Town's Municipal Development Plan as a candidate for an Area Redevelopment Plan.

Consideration of other initiatives that were underway that would support the information needs of the community revitalization plan included the Heritage Resources Inventory of historically significant buildings in the identified area of Uptowne, the Transportation and Utility Master Plan, the Highway 27 Functional Transportation Plan, the Olds Strategic Sustainability Plan, and the East Olds Area Redevelopment Plan. Use of these existing materials would be utilized to fill in the gaps to result in a community revitalization plan that meets the Province's expectations.

Numerous community consultations for contributions into the Uptowne Olds Area Redevelopment Plan took place over the last 18 months that included community visioning and design options workshops. Input was also gathered from referral agencies, residents and the general public through open houses and public meetings.

In November of 2010, the Alberta Urban Municipalities Association called for the development of a provincial Brownfield redevelopment strategy. In the AUMA Municipal Connection Newsletter of November 2013, one of the recommendations for redevelopment of Brownfield's included the provision of financial tools, such as the Community Revitalization Levy to enable such redevelopment.

In April 2014, the Government of Alberta issued a press release regarding the Edmonton CRL and the quote provided by then Acting Minister of Municipal Affairs did not convey the suspension of this program, thus making the suggestion that the program is still available.

As late as May 27, 2014, a webinar on Brownfield Development hosted by the Alberta Urban Municipalities Association makes reference to the CRL financial tool for municipalities.

A letter of intent was sent to the Ministry in January of 2014, to which the Minister responded that the province is not accepting any new applications for the CRL at this time. A second letter was sent requesting reconsideration and the response from the Province was the same. The reason for this suspension is stated to be a review of the Community Revitalization Levy as it is affected by a redistribution of the provincial education property tax to support the CRL.

Countless hours of time and resources have been realized in preparation to request application to Municipal Affairs for a Community Revitalization Levy for the Town of Olds. Not only the skill sets of property assessment, financial management, engineering, planning, landscape design, public facilitation, intergovernmental liaison and report writing were utilized, and the engagement and citizen guidance have been significant. Not having access to the CRL program has been disheartening to our community.

For many years, AUMA has advocated for the education portion of the property tax to be removed as shown by the AUMA membership supporting the 2011 Resolution of the Removal of Educational Tax Requirement. The province has resisted this advocacy for various reasons. The CRL is a tool that gives some temporary (20 years) relief from provincial funding from the property tax. Programs like the CRL show provincial support for innovation in responding to municipal infrastructure renewal.