While St. Albert's 150th anniversary has been celebrated throughout the year, 2011 also marks the beginning of the end to a revenue sharing agreement that one former mayor says is the worst in the city's history.
In 2004, St. Albert signed an agreement with Sturgeon County to provide the county with 37 per cent of the commercial tax revenue generated by the Walmart power centre in St. Albert's north. The deal concluded years of wrangling over a 50-50 tax split that was hastily agreed to but never formalized when the city annexed about 16 hectares from the county in 2001.
There are two phases to the revenue sharing deal that coincide with the two phases of development that took place at the power centre. Revenue sharing from the first phase ends after 2011 while the second phase runs until 2013.
The deal has seen St. Albert send a total of $2.2 million to date, split almost equally between the two phases. This year, St. Albert paid a total of $351,000: $158,000 for phase one and $193,000 for phase two.
Former mayor Richard Plain, who held office from 2001 to 2004, fought the agreement throughout his term but finally signed it in 2004, insisting at the time that he and council were only following through on the previous council's commitment.
"It was the most one-sided, worst agreement the City of St. Albert has ever entered into in its history," Plain said in a recent interview.
The county didn't invest any money or time into the development but received a significant share of the tax revenue "needed to run our city," he said.
Prior to 2001, Walmart was located in St. Albert Centre and was looking to move into a standalone location at the north end of St. Albert. The council of the day feared that the anchor retailer and all its followers would move to 137 Avenue in Edmonton if St. Albert couldn't annex some land from Sturgeon County, said former Mayor Paul Chalifoux, who held office at the time.
"The pressure was there to get that annexation done or the company was interested in putting [its store and tenants] on 137 Avenue," Chalifoux said.
Former Sturgeon County mayor Helmut Hinteregger said the deal was a win-win, because St. Albert got development and the county got a fair revenue sharing deal.
"We always looked at it and said, we have to be entitled to something," he said.
Annexation and revenue sharing were hot topics at the time, he said.
"The talk all around the Edmonton region was that the jurisdictions that are taken over should have an opportunity [to get some revenue]," he said.
He noted that he pushed for the county to chip in for St. Albert's new leisure centre, Servus Credit Union Place. The county provided $500,000 to help with the capital costs.
"That was sort of a fair and equitable way of gaining some revenue then giving some of it back for a facility," Hinteregger said.
The tax sharing agreement paved the way for the city to annex 1,336 acres from the county in 2007. However, the terms of that annexation were different, with the city ordered by provincial cabinet to pay Sturgeon $800,000 over 10 years starting in 2009.
Local projects
The 2004 tax sharing agreement also included a commitment on the county's part to spend the money on projects near the city, said St. Albert Mayor Nolan Crouse, who helped negotiate the agreement as a councillor.
As mayor, Crouse has received a letter each year describing how the county has spent the money. These include bridgework on Villeneuve Road and upgrades to Bellerose Drive, he said.
Even so, he's happy that the agreement is coming off the books because it means more money for St. Albert's coffers.
"Sturgeon County got a lot of cash out of it … taxpayer money that's rightfully due to St. Albert," Crouse said. "It's St. Albert that has to plow the roads and mow the grass and provide the fire services."
On the flip side, the development is there and it's a strong revenue generator, he said.
"I look at it now, and 10 years later, it's a good site," Crouse said. "From that point of view, it's been a win-win."
Plain has a different conclusion.
"It was horse trading at its finest," he said, "and it should never have happened."
