Res #: 16-11M
Number: 16
Year: 2011
Midterm: Yes
Expired: Yes
Responses Received: No
Departments: SaskPower

WHEREAS SaskPower adds a surcharge on the monthly account of every customer in a city, town or village; and

WHEREAS this money is used in lieu of taxes and is guaranteed income for the city, town or village; and

WHEREAS Organized Hamlets and Hamlets do not qualify under The Power Corporation Act;

BE IT RESOLVED that SARM lobby the Provincial Government to amend The Power Corporation Act to make Organized Hamlets and Hamlets eligible to receive the monthly surcharge.

Response from Honourable Rob Norris, Minister Responsible for SaskPower:

I have consulted with SaskPower officials and I am advised that this system of tax collection was put in place in the 1940′ s during the period of time that the power system of this Province was being consolidated from a collection of small utilities under both private and municipal ownership. As compensation for the revenue loss faced by municipalities when the Saskatchewan Power Commission and later the Saskatchewan Power Corporation took over ownership and operation of the small utilities, the system of the municipal surcharge was put in place for Cities, Towns and Villages.

It is my understanding that since no Hamlets or Organized Hamlets had electrical utilities within their boundaries taken over by either the Saskatchewan Power Commission or the Saskatchewan Power Corporation, there was no basis for compensation for lost revenue. For this reason, Hamlets and Organized Hamlets were not included in the types of municipalities which are eligible for this type of tax collection by SaskPower on their behalf.

There are also some difficulties in determining where the boundaries of smaller municipal bodies start and stop. There are clear corporate limits on larger urban municipalities such as Cities, Towns and Villages. This makes it a relatively straight forward task to determine which power accounts are liable for the municipal surcharge and which ones are not. At the present time, there is no practical way for SaskPower to identify which customer accounts are within the boundaries of an Organized Hamlet or a Hamlet in order to add the surcharge to the appropriate customer accounts.

I am also advised by SaskPower that although all Cities, Towns and Villages are eligible to have SaskPower collect the surcharge on their behalf, this collection does not occur unless there is a request made to SaskPower by the Council of the municipality. Currently there are 43 eligible Towns and Villages that have not found it necessary to request SaskPower collect this tax on their behalf.

For these reasons there is currently no plan to amend The Power Corporation Act to include Organized Hamlets or Hamlets in the list of municipal entities eligible to request SaskPower to collect the municipal surcharge on their behalf.