The County of Paintearth council agreed to accept about $30,000 from an oil and gas company that owed about $48,000 in unpaid property taxes to resolve the situation. The offer was approved at the July 15 regular meeting of council.

Councillors read a staff report describing unpaid property taxes totalling $48,263.02 for two tax rolls, 46000603 and 70008171, that belonged to a defunct oil and gas company. Readers should note municipalities appear hesitant to identify any business, organization or individual that owes unpaid taxes, likely the result of provincial government privacy legislation.

“In an effort to recover unpaid taxes and penalties on the above-mentioned tax rolls, the County of Paintearth has been working with legal counsel,” stated the staff memo. “The county was notified that a new company was taking over part of the unpaid taxes on assets that they co-owned with the ratepayer on file for these tax rolls. At a time when it seemed unlikely that the county would get any money from the present owner, this transfer of ownership will provide some chance for partial collection of outstanding taxes and penalties.

“In 2022, this new company signed a 'farm-in agreement' with the existing owners. At that time, they were not made aware of any unpaid taxes, nor did they receive any tax notices that the county mailed out to the ratepayer on file. 

The new company accepts responsibility to pay for most of the tax arrears on the licenses that are being transferred to it, however they have operated only 85 per cent of the linear properties associated with tax roll l #46000603 and therefore are asking for forgiveness for the penalties and some of the outstanding taxes.

“Total outstanding taxes and penalties on these two tax rolls from 2021 to 2024 is: $48,263.02. They are offering to pay $30,626.30 and asking for forgiveness of $17,636.72, of which $15,546.11 is penalty and $2,090.61 is outstanding taxes.”

Chief Administrative Officer (CAO) Michael Simpson stated this item is one of the bigger unpaid debts county staff have been working on. The CAO stated councillors have the authority to waive all, part or none of the unpaid property taxes, including late penalties.

Coun. Maurice Wiart noted that he was not necessarily in favour of forgiving penalties on unpaid oil and gas property taxes but pointed out the new owner wasn’t actually the company that left bills unpaid.

Coun. Terry Vockeroth responded that the new owner should have looked into the situation more closely before buying parts of a defunct company. Vockeroth stated that a farmer wouldn’t just buy farmland without looking at it and investigating it first.

The issue of unpaid property taxes in Alberta’s oil and gas industry has become a provincial problem; other municipalities in central Alberta have reported millions of dollars of unpaid property taxes owed by oil and gas companies, some of them defunct, some not. 

Municipalities have noted in council meetings that one issue contributing to this problem is that municipalities can’t use normal methods such as tax recovery auctions to recover unpaid oil and gas taxes as the Government of Alberta has forbidden that.

Councillors passed a resolution accepting the anonymous company’s offer.