The City of Cold Lake is accusing the federal government of relying on misleading information during its long-running dispute over Payments in Lieu of Taxes (PILT), with council unanimously voting to formally raise its concerns with the federal Minister of Public Services and Procurement Canada.

The decision follows new information provided by Cypress County, which the City says contradicts evidence previously presented by Public Services and Procurement Canada (PSPC) and the Department of Justice Canada during both quasi-judicial proceedings and before the Federal Court of Appeal.

According to the City, Cypress County advised that assessment practices described by the federal government for CFB Suffield were not based in fact, despite being presented as evidence during the dispute over the assessment of 4 Wing Cold Lake.

Long-running PILT dispute

Payments in Lieu of Taxes are payments made by the federal government to municipalities that provide services to federal properties, including military bases.

For years, Cold Lake has argued that the assessed value of 4 Wing Cold Lake has been improperly reduced, resulting in lower PILT payments and shifting more of the tax burden onto local taxpayers.

The City says several court decisions have already found problems with previous federal decisions throughout the dispute.

Now, newly obtained information from Cypress County has raised additional concerns.

According to the City, PSPC previously argued that CFB Suffield was assessed using large, unserviced land parcels as comparable properties and that adjustments were made to account for existing infrastructure.

However, Cypress County has advised Cold Lake that this assessment methodology has never been used for CFB Suffield.

Instead, the County says PSPC has only recently advised that it intends to begin using that approach in future assessments.

The City argues that this contradicts evidence previously presented by the federal government during the legal proceedings.

Council raises concerns

Mayor Bob Mattice said the City believes the dispute has gone far beyond a disagreement over taxation.

“The Government of Canada appears to be handling this issue by throwing money at lawyers and bogging us down in the legal system,” Mattice said.

“They have done a great job of turning the legal process into a punishment. What they seem unable to do, however, is make a strong argument in court, or base what arguments they have made on factual information.”

Mattice said the City remains committed to pursuing the matter despite the length of the legal battle.

“As this dispute continues, the government’s actions feel increasingly underhanded, but our principles dictate that we continue this fight,” he said.

“We cannot sit and watch while the federal government treats its own taxpayers this way.”

Potential implications beyond Cold Lake

City officials say they are also concerned the issue could extend beyond Cold Lake.

According to the City, it remains unclear whether the federal government intends to apply similar assessment practices to military bases and other federal properties elsewhere in Canada or whether Alberta municipalities are being disproportionately affected.

The City says the Federation of Canadian Municipalities (FCM) has also expressed concerns regarding recent federal actions surrounding the PILT Act.

Council has now directed administration to formally communicate its concerns to the federal Minister of Public Services and Procurement Canada, requesting accountability regarding the evidence presented throughout the dispute.

Why this matters

While the dispute centres on how 4 Wing Cold Lake is assessed for municipal tax purposes, the outcome could have implications for municipalities across Canada that host federal facilities. Cold Lake argues that if the federal government is successful in reducing assessed values, municipalities may receive less compensation for municipal services they continue to provide.