The City of Weyburn is facing a major financial hit, ranging anywhere from $250,000 to $750,000 as a result of a provision in the Saskatchewan provincial budget tabled in the Legislature on Wednesday.

A Vice-President of the Saskatchewan Urban Municipalities Association (SUMA) says SaskPower and SaskEnergy will no longer provide the city with grants in lieu of taxes, totaling just over three quarters of a million dollars.



"Some of the cities and some of the bigger towns that are going to take a hit after this budget, and for Weyburn, what it means, for grants-in-lieu being cut, is $765,715.00” said Mike Strachan, SUMA Vice President for Villages, Resort Villages, and the North. Strachan is also the Mayor of Torquay.



Weyburn Mayor Marcel Roy agrees the city is facing a major hit, but says the full amount has not yet been determined. "At this point in time, as much as we know from SUMA on the release, it is only SaskEnergy's portion of it, which was only $250 thousand. If power is included in this, which we haven't gotten notification yet, it will be another additiional 500 thousand dollars." he said late Friday afternoon.



Either way, he acknowledges city council has been handed a major financial issue that must be dealt with. "At this point in time, we are still looking at how all the budget implications are, and we will be discussing it more, and doing another release to the public, probably after city council meeting on Monday." he added. "Stay tuned, and we'll be discussing it again on the morning of Tuesday."



Roy added he had received no warning from the province that such a hit was coming. "To my knowledge, to me, personally, I never heard anything. Whether they phoned and spoke to any other staff, I am unaware of it, but as me, as Mayor, they had no consultations whatsoever."



It is Roy’s understanding that SaskPower and SaskEnergy pay property taxes to the city for facilities on city land. He believes the annual grant from the crown corporations was based on consumption of power and natural gas by city residents and businesses. "SaskEnergy, SaskPower, pay taxes on the buildings, so it seems that it was a grant that was given to the cities, 5 per cent on total consumption of the SaskEnergy, SaskPower used within the urban cities." he said.



"They always say it is 'in lieu of', a 'grant in lieu of' but there has never been really any clarification of 'in lieu of' what. Because, SaskEnergy, SaskPower, pay taxes on the buildings, so it seems that it was a grant that was given to the cities."



Meanwhile, SUMA Vice President Strachan criticized the provincial government for not consulting with municipalities before making a move with such large consequences. "Government needs to start consulting with municipalities before they start putting these on the table.” said Strahann. “I was just talking to the Mayor of Yorkton, and for Yorkton, it's going to be about an 8 per cent increase for property taxes alone, so this is a big issue for our residents."