Gravel Extraction Compensation

Year: 2014

Number: 17-14A

Department: Saskatchewan Ministry of Government Relations

WHEREAS The Municipalities Act does not provide for a method of collecting unpaid gravel extraction fees other than with methods that are extreme or possibly volatile; and

WHEREAS The Municipalities Regulations also do not provide for an accurate way of determining gravel licensing fees;

BE IT RESOLVED that SARM lobby the Provincial Government to provide a more accurate way to determine fees and an easier method to collect unpaid gravel extraction licensing fees.

MINISTRY OF GOVERNMENT RELATIONS'  RESPONSE

Municipalities have the authority to pass a bylaw to charge gravel crushers and extractors a gravel extraction licence fee.  The maximum fee a municipality may establish is calculated by a formula set out in section 8.1 of The Municipalities Regulations.

The formula was implemented in 2008, following a review of gravel extraction licence fees in 2007, to provide automatic biennial updates to the maximum rate.  The review was initiated by the ministry based on a request from SARM and both industry and local governments were consulted.  The formula provides for automatic maximum fee increases based on the rate of inflation.

The current maximum gravel extraction licence fee rates for 2014 and 2015, effective January 1, 2014, are as follows:

  • $0.156 per cubic metre or $0.119 per cubic yard; and
  •  $0.084 per cubic tonne or $0.078 per ton.

These rates were finalized in October 2013, and announced in December 2013.

As per the regulation, the rate increase for 2014 reflects a Consumer Price Index (CPI) inflation rate of 2.8 percent in 2011, and 1.6 percent in 2012.  These calculations are made and announced by the ministry.

Section 381 of The Municipalities Act provides for general offences and penalties for the contravention of a municipal bylaw.  It is up to municipalities to enforce bylaw provisions as they see fit.  Penalties for contravention of a municipal bylaw are fines of $2,000 for an individual or $5,000 for a corporation.

The Municipalities Regulations allow for a pre-extraction fee that a municipality may assess based on a volume of 10,000 tonnes or less.  The municipality may demand this fee be paid by the contractor before extraction may begin.

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