Carbon tax funding of major transit projects a 'political accounting gimmick,' Kenney says

Jason Kenney says tying public transit funding to Alberta's carbon tax is a "political gimmick,"and he refutes Premier Rachel Notley's claims that repealing the levy would pull the plug on two LRT projects.

The United Conservative Party leader was asked how he would replace the funds generated by the provincial carbon tax, as he has said his first order would be to cancel it if his party forms government.

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"I reject the premise that the carbon tax is funding those projects," Kenney told Alberta@Noon on Tuesday.

"That is just a political accounting gimmick. There is one general revenue fund for the province of Alberta that all revenues go into, including carbon tax revenues. There is one consolidated spending authority voted on by the legislature. The notion that this stuff is tied to a separate carbon tax budget is just a gimmick."

Rachel Notleyappeared on Alberta@Noon last Tuesday, where she said repealingthe tax would be damaging.

"The Green Line in Calgary would get cancelled, the new LRT line in Edmonton would get cancelled. We would also be unable to support the good work that's going on the technological innovation, taking carbon out of the product we produce, making sure we can present to the world a sustainable, responsible product and at the same time supporting the efforts of Albertans to reduce our emissions."

Just doesn't add up, NDP says

Her team doubled down Tuesday afternoon, in response to Kenney'sinterview.

"Mr. Kenney thinks he can blow a hole in the budget and still build the infrastructure Albertans need. This just doesn't add up," NDP spokesperson Mike Brown said in an emailed statement.

"Whether it's eliminating carbon levy revenue or his proposed $700-million tax cut to the richest one per cent, it's clear that Mr. Kenney doesn't have regular Albertans in mind. It's time he came clean on how he would fund infrastructure like the Green Line, schools and hospitals with all of his proposed cuts. The reality is no carbon levy revenue means no Green Line LRT in Calgary."

'I have said yes repeatedly'

Kenney, as minister with the federal Conservative party, committed $1.53 billion in funding for Calgary's Green Line LRT project in 2015 roughly a third of the cost. The other two-thirds are to be supplied by the city and the province.

"I have said yes repeatedly. I want the Green Line that I committed federal funds to in 2015, which is twice as large as the one the NDP has committed to now," Kenney said Tuesday.

It was the City of Calgary, however, that decided to scale back the projectin May 2017,citing escalating costs and uncertainty regarding the province's funding contribution.

• City recommends scaled back first leg of Green Line LRT
• Alberta pledges $1.53B for Green Line LRT

Two months later,the province committed to matching the previously announced federal funding.

"I am committed to a Green Line, but my first question to the City of Calgary is, why aren't we getting the same Green Line that I funded federally, and how do we expand it?" Kenney said.

And while Kenney disputes funding is attached to the carbon tax, he said there will be some savings when the related rebates are also cancelled.

Other parties would keep the carbon tax, except one

The Alberta Party, Alberta Liberal Party and Green Party of Alberta have all indicated that they would keep the provincial carbon tax, but with some tweaks.The Freedom Conservative Party of Alberta has said it would scrap the levy entirely.

Under the federal climate change plan introduced by Justin Trudeau's Liberals, the carbon tax must reach $50 per tonne by 2022. Notley had said Alberta would respect the federal mandate, but later pulled out, expressing frustration with the federal government's handling of pipeline and energy industry challenges.

When the NDP introduced the carbon tax, Notley had explicitly linked it to getting the social licence needed to get pipelines built. The government rolled out a $20-per-tonne tax on carbon dioxide emissions on Jan. 1, 2017, which increased to $30 a tonne on Jan. 1, 2018.

Provincial legislation dictates an election must be held between March 1 and May 31.

Duane Bratt, a political science professor at Mount Royal University in Calgary, has said while the messaging and timing have not been ideal for the Alberta NDP, a carbon tax has many benefits.

"Let's say we didn't have the carbon tax. Let's say we use the Jason Kenney approach. Would we be any closer to building a pipeline?" Bratt asked last week.

Listen to the entire Alberta@Nooninterview with Jason Kenneyhereor watch the Facebook Live videoright here.

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With files from Alberta@Noon