In business, if you are struggling to remain profitable, you have a number of options. You can look for ways to become more profitable with new products or services, or find ways to reduce costs or raise prices and still be competitive. You could sell off the inventory and assets (buildings and equipment) or close the business. Or you could look for a merger or acquisition where you either join forces with another business or sell out to a competitor.
For a municipality, the options are limited. You can’t simply sell off your assets and close down, but you can continue to raise revenues through increased taxation. However, if costs are too high, you will find residents and businesses choosing to go elsewhere (no different than if you found prices too high at one store, you would find another store selling the same or similar products at a lower price.)
But, there are two options that might be considered if the City of St. Albert decides not to pursue a balanced tax base by adding more industry to the tax mix. These options could be similar to what might happen in the business world – acquisitions or mergers. In the municipal world, these might be referred to as annexation or amalgamation.
Under acquisition (annexation) the City of Edmonton could simply acquire St. Albert and take over responsibility for its operations. Some residents have suggested they would not experience any differences if Edmonton were to annex St. Albert as many of them originally came to St. Albert from Edmonton, commute back and forth daily and depend on Edmonton businesses to meet their consumer needs. If annexed by Edmonton, residents might expect their taxes to go down, as Edmonton has a much larger tax base with a healthy mix of residential and non-residential development.
If this is not appealing, perhaps a merger (amalgamation) would be more palatable to St. Albert. Across Alberta municipalities are joining forces to become more sustainable. The best examples of what a merger may look like would be Strathcona County or Wood Buffalo, where urban and rural residents have joined forces under one municipal umbrella. Strathcona County is home to the “hamlet” of Sherwood Park and a large industrial base. The recent formation of Wood Buffalo takes in most of the northeast Alberta oilsands and includes the former City of Fort McMurray.
So, what might a merger look like for St. Albert? Would it be possible for Sturgeon County and St. Albert to join forces, similar to Sherwood Park-Strathcona County example? Could the towns of Redwater, Gibbons, Bon Accord, Morinville and Legal all fall under one new specialized municipality duplicating what has happened in Wood Buffalo or Strathcona County?
I doubt this type of merger would take place in my lifetime, but let’s think about the benefits from such a merger. At first glance, the merger could meet each of the partners’ needs. Sturgeon County has an abundance of land for future industrial and is a major player in Alberta’s Industrial Heartland. However, under the Capital Region growth plan, Sturgeon County is lacking in residential areas to serve the work force needed in this region. On the other hand, St. Albert is well known for providing exceptional residential developments; however it is lacking the industrial base to support the residents’ needs. St. Albert is already providing recreational facilities, access to retail stores and professional services that the county residents already use. By combining forces, perhaps the needs of both municipalities can be met.
So what other benefits might result from this merger? It is quite possible that operating costs for all the municipalities could be reduced. Instead of seven chief administrative officers, seven councils and countless other overlapping services, the entire region could be governed and managed by a much smaller bureaucracy. And therein lies the problem. You have councils and management teams all protective of their turf. Working together may not be in their personal best interests.
It may be farfetched to think St. Albert and Sturgeon County could bury the hatchet and join forces, but perhaps a little thinking out of the box may lead to some resolution of St. Albert’s current reliance on the residential tax base. This type of ‘merger’ may also appeal to other municipalities in the region. Just think what would happen if Parkland County joined forces with Spruce Grove and Stony Plain, or the City of Leduc joined forces with Leduc County and its neighbouring municipalities? Perhaps something to think about if we want to be sustainable!
