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MLA Hanson says Cold Lake has spending problem in light of CLAWR money comments; City says costs cited are PILT related

MLA David Hanson did not mince words in responding to Cold Lake Mayor Craig Copeland saying the City has a spending problem, not a revenue problem compared to similarly-sized communities. The City says the reason has to do with their lawsuits against the federal government for unpaid property taxes on 4 Wing.

Tensions regarding the Cold Lake Air Weapons Range tax revenue negotiations took a new turn on Friday as MLA David Hanson responded to comments Cold Lake Mayor Craig Copeland made that the process was embarrassing and that “Everyone and their dog is trying to be a part of 349.”

Hanson said he told the leaders of the six municipalities – Cold Lake, Bonnyville, M.D. of Bonnyville, Glendon, Fishing Lake Metis Settlement and Elizabeth Metis Settlement – to not negotiate through the media as the Government of Alberta decides the future of the ID 349 funds.

“I’m a little pissed off…that’s the truth,” said Hanson on The Alberta Legislature.

“Mayor Copeland, ‘Everybody and their dog?’ Who are you referring to? Come on. I asked them to not negotiate in the media. And he did, so I have to respond.”

The Alberta Legislature with David Hanson, MLA Bonnyville-Cold Lake-St. Paul.

Posted by Lakeland Connect on Friday, November 22, 2019

Hanson said the comments are being used as a tactic to scapegoat raising taxes on the provincial government if the CLAWR money is not favourable to the city.

He added that the city’s operating costs have jumped almost $5.5 million from 2010 to 2018, which the City says has to do with the ongoing legal dispute with the federal government about payment in lieu of taxes (PILT) with 4 Wing.

Hanson compared the financials of Cold Lake to similarly-sized cities like Brooks and Lacombe.

With a population of 14,185, Brooks’ total revenue in 2018 was $28.9 million. Their administration costs $3.1 million. Lacombe with just under 13,000 people brought in $36.7 million in revenue. Their costs were $3.4 million, said Hanson.

The City of Cold Lake in 2018, brought in $48.3 million and their administration costs $8.1 million. In an eight-year period from 2010 to 2018 administration costs went from $2.7 million to $8.1 million dollars, said Hanson.

“You know what this is all about, the money tree is being pruned. The mayor and his council see that they’re not going to have as much money as they have been getting in the past,” said Hanson.

“When he came out last week and made those statements, it gives him basically pointing the finger at me and our ministry that you know, if he asked to raise income or the property taxes in the City of Cold Lake, it’s going to be my fault or the Minister’s fault and that’s absolutely not true.

“When I look at the numbers, the city doesn’t have a revenue problem. They have a spending problem.”

Legal dispute about taxes on 4 Wing

The City responded on Friday via their Facebook page with financials that took into consideration the payment in lieu of taxes with the federal government and 4 Wing air base.

In an emailed statement, the City stated the total amount of $8,172,016 in operating costs includes $3,428,527 of a  bad debt allowance and $235,228 legal fees associated with fighting for the PILT file.

When those costs are removed the operating fees are $4,508,261.

In 2017, the City’s administration charges totaled $7,678,518 with bad debt at $2,968,033 and legal fees at $327,650. leaving $4,382,835 for other administration costs in 2017.

“PILT is the payment in lieu of taxes from 4 Wing Cold Lake that the City has been in dispute with the federal government for many years on the amount of property tax owed. The difference owed is coded to this bad debt allowance,” the email read.

Mayor Craig Copeland added that the allowance on the City’s bad debt is the outstanding PILT, which shows up in an overall administration costs.

“We’re getting labeled wrongly and the fact remains, take out the legal costs against PILT and the outstanding bad debt allowance, nine per cent of our total cost is administration, in line with the communities that we’re being referenced too,” he said.

“We wish we didn’t have a bad debt allowance on the books with the federal government. We wish the federal government would pay their fair share of taxes, but unfortunately, we’re out millions of dollars and so the information is misleading.”

“City of Cold Lake residents are very concerned about the future of our city and council is trying our best to represent the community. We’re sitting down starting to do our budget right now and we’d like to know what is going to be the taxes that are going to come off of ID 349 for our community, for 2019 and also going forward so that we can plan our community going forward,” said Copeland.

Hanson does not buy insolvency

When referencing these financial figures, MLA David Hanson issued a challenge to Copeland about threatening insolvency if the Cold Lake Air Weapons Range is not favourable to the City.

“The idea that the city will be insolvent if they don’t have that money coming in from as much money as they were getting – the mayor has often threatened, he’s often threatened me and he’s threatened the minister that if they don’t get this money that they’ll hand him the keys,” said Hanson.

“I would say that watching what the mayor said in your interview, he hit two things on the head. And number one is that he should be embarrassed and the other one is maybe it is time to turn the keys in.”