Municipalities play an important role in shaping Alberta’s communities and contributing to a stronger province. Alberta’s government is providing reliable funding so municipalities can plan more effectively for the future.
Alberta’s government introduced the Local Government Fiscal Framework (LGFF) in Budget 2024 to replace the Municipal Sustainability Initiative (MSI) and provide a more predictable, legislated municipal infrastructure-funding model that is 100 per cent tied to provincial revenues, as municipalities requested. This means that when provincial revenues increase, municipal funding increases at the same percentage. Next year, municipalities will receive more than $820 million for the 2025-26 fiscal year, an increase of just over 13 per cent from Budget 2024.
“Our government recognizes the importance of infrastructure funding for communities across Alberta, and for that funding to be predictable. We agreed to tie capital infrastructure funding for municipalities to provincial revenues, and the Local Government Fiscal Framework delivers on that promise. LGFF funds are increasing in 2025 because of our shared commitment to sustainability.”
The LGFF provides funding for local infrastructure priorities in cities, towns, villages, summer villages, municipal districts and counties, and Metis Settlements across Alberta. Budget 2024 also included $60 million in LGFF operating funding for communities outside Calgary and Edmonton.
Through the Local Government Fiscal Framework Act, the LGFF includes a revenue index factor that ties future funding levels to the percentage change in provincial revenues from three years prior. The boost in municipal infrastructure funding for Budget 2025 is the result of increased provincial revenues for the 2022-2023 fiscal year, and is evidence of the LGFF revenue index factor at work.
Quick facts
- The Local Government Fiscal Framework Act was passed in the Alberta legislature in December 2019.
- Alberta’s municipalities received $722 million in LGFF funding for the 2024-25 fiscal year, which is equivalent to the average amount municipalities have received annually since Budget 2021.
Related information
Related news
- Predictable funding for municipalities (Dec. 15, 2023)