The impact of population size and population growth rates on Alberta municipal finance

This thesis was prompted by the concern over the Alberta Provincial Government's responsiveness to the fiscal needs of different sized municipalities. These needs are reflected by per capita differences in municipal revenues and expenditures for these different sized municipalities. The fiscal impact of population size and population growth rates is relevant to the Alberta situation as the promotion of large scale projects, which results in rapid population increases for many Alberta municipalities, is the basic modus operandi for economic development in the Province. In this study of municipal finance, disaggregated per capita expenditure and revenue data of 35 Alberta municipalities is regressed on population size and population growth rates for 1975 through to 1979. In addition, revenue reliance and debt levels are examined to determine the fiscal capabilities of Alberta municipalities as too much reliance on grants or borrowing leads to fiscal and political vulnerability. The results of the empirical analysis reveal a few statistically significant relationships between per capita municipal revenues and expenditures and population size. Population growth rates; however, do not appear to be a significant determinant in explaining variations in municipal finances. Overall, the revenue effort and expenditure needs of Alberta municipalities are found to increase with population size. However, the provincial granting formula is not responsive to these varying needs and the findings of this study indicate that residents in larger municipalities have a greater fiscal burden than their counterparts in smaller municipalities. This study identifies the need to alter provincial funding formulas to make them more responsive to differing fiscal needs and fiscal efforts.Applied Science, Faculty ofCommunity and Regional Planning (SCARP), School ofGraduat