Stettler County writes off over $100k in energy industry unpaid taxes

ECA Review/File
Written by ECA Review

The County of Stettler wrote off unpaid oil and gas property taxes totalling over $100,000, adding that the provincial government needs to do something about unpaid taxes in that industry. 

The decision was made at the Dec. 9 regular meeting of council.

A report on several oil and gas company’s bad debts to Stettler County was presented by county Chief Administrative Officer (CAO) Yvette Cassidy and tax clerk Sharon Larsen, who explained in her memo to council that the municipality can use the few avenues open to it to try to recover some outstanding money. 

“For oil and gas properties which all avenues of tax collection has been exhausted a municipality can apply to the province for the Provincial Education Requisition Credits program for uncollectable property taxes on oil and gas properties,” stated Larsen. 

Readers should note that property tax bills in Alberta include a requisition for the education system which Stettler County taxpayers must pay upfront and when some property owners don’t pay their taxes, local ratepayers are left holding the bag for this requisition.

Larsen’s report included a detailed chart listing the companies involved and the various unpaid debts, some of the unpaid debts dating back to 2018.

The companies listed in the memo included Quattro Exploration and Production, Canadian Oil & Gas International and Cansearch Resources, with the total debt owed by all three companies to the taxpayers totalling $123,915.17.

Coun. James Nibourg employed some humour to highlight the issue which has affected many Alberta municipalities, especially rural, over the past few years to the tune of millions of dollars. “This doesn’t happen, does it?” asked Nibourg.

Larsen noted in her report one of the companies in question was U.S. based and no longer has a presence in Canada. Some of their assets were sold to other companies and some went into the Alberta government’s orphan well program.

Coun. Ernie Gendre, looking at the memo, asked if some companies paid some of their debts but still owed money. 

Larsen explained some unpaid debts were transferred to new ownership who then paid some of the debts.

Reeve Larry Clarke asked what options the county has if and when some of the wells linked to bad debts, and leadership previously associated with defunct companies, are reactivated and start producing again.

Coun. Nibourg stated companies that owe money should be denied service much the same way unpaid child support is handled.

CAO Cassidy stated Stettler County has lobbied for such an approach as certain oil and gas companies may go bankrupt but the leadership involved may form a new company. 

Cassidy stated lists like the one councillors had in front of them should be used as a “red flag” list so local taxpayers can eventually recover what is owed to them.

Coun. Dave Grover said if a farmer didn’t pay his taxes, he could eventually lose his property, and oil and gas properties should be treated the same way. 

“You should be able to put a lien on them,” said Grover. 

Grover suggested the provincial government get more involved in this issue. 

“[The provincial government doesn’t] seem to want to clamp down on the oil companies,” added Grover.

Councillors unanimously approved writing off the $123,915.17 in bad debt so staff could apply for the appropriate relief programs.

 

Stu Salkeld, Local Journalism Initiative reporter

ECA Review

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