Alberta says they’re lowering the cost of borrowing for municipalities
Alberta is lowering the cost of borrowing for municipalities, enabling them to invest more in services and infrastructure.
Municipalities play an important role in shaping Alberta’s vibrant communities and contributing to a stronger province. The province of Alberta will now lend money to local authorities, which include municipalities, airports, counties and irrigation districts, at a lower rate.
These entities will now pay the same interest rate as the province on money borrowed for infrastructure and other capital projects. The change is expected to save municipalities about $7 million in 2025-26 and about $12 million in 2026-27.
In a time of high interest rates, Alberta’s government is reducing the budgetary pressures faced by local governments and frees up funds for purposes other than servicing debt.
With Alberta’s balancing of the budget, the province has been able to reduce outstanding debt by more than $19 billion. With continued strong results, Alberta’s borrowing costs are expected to remain low.
The Loans to Local Authorities program allows even the smallest municipalities in Alberta to benefit from the province’s fiscal strength and well-established access to global capital markets. The province lends money to local authorities to help finance their capital projects, such as roads and upgrades to local water, sewer, gas and electric services.
“Alberta has lowered our cost of borrowing, and now we are passing that savings on to municipalities,” says Nate Horner, President of Treasury Board and Minister of Finance. “They are our partners in providing services to Albertans, and by working together we can ensure that investments can be made with a minimum cost to service debt.”
“Our government provides billions of dollars in support to municipalities, ranging from grants to capital funding,” says Ric McIver, Minister of Municipal Affairs. “Lowering the cost of borrowing for municipalities is just one more way we are ensuring that municipalities, counties, airports and irrigation districts can invest in their citizens.”
-Alberta Government Release
