Although the province is predicting more than a $5.2-billion deficit in its Budget 2025, the is only $5 million earmarked for Medicine Hat, and it will be shared over two years with Lethbridge.--NEWS FILE PHOTO
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The province will run a large deficit in 2025 while continuing to determine the threat of U.S. tariffs to the Alberta economy, usher in a personal income tax cut in the new budget, but provide few new major spending projects in the southeast.
Finance Minister Nate Horner said the budget’s theme is “Meeting the Challenge” of potentially falling revenue if trade disputes hit the province’s export-dependent energy revenues hard.
“I’m keenly aware that we’re in a particularly interesting time in our history, a time of change … our province is no stranger to change or challenge,” said Horner during his budget address on Thursday afternoon.
Alberta companies exported more than $100 billion in products to the U.S. in 2024, and the province predicts a $5.6-billion drop in revenue next year, compared to 2024-45.
A projected deficit sits at $5.2 billion.
“Albertans want good jobs and help with the increasing cost of living,” said Alberta New Democrat finance critic Court Ellingson. “They also want investments in public health care, public education and public safety. But with billions in cuts, the UCP’s budget fails to meet the needs of Albertans.”
He argued spending in health care and education hasn’t risen to meet population growth or inflation.
Locally, the City of Medicine Hat will see a 13 per cent increase in new capital infrastructure grant, the Local Government Fiscal Framework.
All municipalities in the province share in $820 million in 2025-26, about $96 million more in the formula that is tied to a three-year rolling average of provincial revenue.
That would bring the city’s share to $9.46 million to spend on capital projects, about $1.2 million more than in 2024, according to city budget documents.
Other municipalities in the area would also benefit – the formula was set two years ago and the increase was expected, though final amounts will be determined in part by per-capita formula.
That point struck members of the city’s corporate services committee.
“Population growth is very topical,” said chair Coun. Robert Dumanowski.
Also at the local level, the province will unfreeze rates it charges for educational property taxes, collected by cities.
They will collect an additional $400 million across the province, bringing the total to $3.1 billion.
The change equates to a $50 increase for the average Medicine Hat residential property, and $250 on a million-dollar business property.
The province will also implement a full two-point personal income tax cut – first promised by Premier Danielle Smith during the 2023 election, then pushed further out last year – that will go into effect for next year’s tax bill.
The move will save up to $750 per taxpayer for the first $60,000 they earn.
“Budget 2025 is meeting the challenge of the cost of living by helping families move towards a brighter future and adding more to each and every one of their pay cheques,” said Horner.
The only specific mention of Medicine Hat in the entire budget document is a $5-million investment shared with Lethbridge to improve intensive care unit capacity at Medicine Hat and Chinook regional hospitals. More details have been requested by the News, though specific projects are typically listed in work plans issued by ministries following the budget passing the legislature, which now resumes sitting March 10.
The Chinook Regional Hospital will also see work proceed on a catheterization lab and additionally $22 million over three years for a renal dialysis program.
The University of Lethbridge will also see $39 million to increase a rural medical teaching program – part of what Horner called plans improve health care throughout rural Alberta
A regional overview of new capital projects in the south outside Calgary includes:
– $225 million over three years to progress school construction, including adding three new schools to the work plan;
– $106 million to complete Highway 3 twinning from Taber to Burdett over the next two years;
– $25 million over two years for equipment to increase security along the international border with Montana, though there is no breakdown of locational spending;
– Money to begin Highways 2 and 3 realignment near Fort Macleod as part of $264 million in new funds for highway improvement.
