Budget 2016: A Good News, Bad News Budget for Alberta’s Nonprofit Sector

The 2016-17 budget is, by and large, what was signalled by the Government over the past weeks. While it is consistent with election promises, the drastic fall in oil prices has slowed implementation in several areas.

“By maintaining spending, the budget has a stabilizing effect on Alberta’s nonprofit sector as other forms of revenue decline in the sector. At the same time, organizations continue to struggle with increased demand for services due to economic conditions and a growing infrastructure deficit,” says Katherine van Kooy, President and CEO of the Calgary Chamber of Voluntary Organizations.

Budget 2016 announces or implements several initiatives to support low-income Albertans:

• Implementation of Alberta Child Benefit to provide up to $2,750 each year for Alberta’s most vulnerable children and families.
• Enhanced Alberta Family Employment Tax Credit (AFETC)will support working families with an annual credit of up to $2,012 for families with four or more children.
• A 13% increase to skills and training support and a 23% increase to labour market programs.
• Funding for affordable housing more than doubles, to $900 million over five years.

Social services funding remains intact and includes modest increases for caseload growth. In her television address, Premier Notley cautioned service delivery partners not to expect additional increases. Therefore, nonprofit service providers will continue to struggle to pay competitive wages and increased operating costs.

Among the measures welcomed by the environmental sector are the $645 million allocation for energy efficiency and micro-generation and $2.2 billion for green infrastructure.

The Government did not deliver on its promises in two major areas:

• Previously announced $15 million (over two years) funding to the Alberta Foundation for the Arts
• Planned $50 million capital increases (over 5 years) for Community Facility Enhancement Program (CFEP)

As funding in both these areas is consistent with the Government’s goals of economic diversification, job creation and infrastructure, it is unfortunate these initiatives did not move forward.

The Government’s job creation plan reverts to a tax credit rather than the previously announced grant program. As such, nonprofits and charities do not qualify for this new measure. Furthermore, while impacts of the new carbon tax will be mitigated through a rebate program for individuals and a tax reduction for small business, no provisions were announced for the nonprofit sector. We are disappointed that the impact on the nonprofit sector fails to have been considered in two of the hallmark initiatives of this budget.

CCVO’s full budget analysis will be released in the coming weeks.