MOOSOMIN — Municipalities in the southeast could see some big changes to future potash tax sharing.
Towns, villages, and rural municipalities within an area of influence of a mine receive potash tax sharing annually, with several variables affecting the amount they receive. Municipalities were recently made aware that effective Jan. 1, 2026, overlapping areas of influence for potash mines will no longer be applicable. Instead, there will be an area of influence for each potash mine where ore is brought to the surface.
“Every year, we do initial estimates and then later in the year—once the taxes are collected by real municipalities—we do distribution of those taxes to urban and rural municipalities based on the formula set out in legislation and regulations,” explained Doug Fisher, Special Projects with the Saskatchewan Association of Rural Municipalities. “The reason for the change is that right now, potash tax sharing is calculated based on what’s called an overlapping area of influence.”
He pointed to the Esterhazy Area as an example with K1, K2, and K3 Mosaic mines, Nutrien Rocanville and Nutrien Scissors Creek being used to calculate the annual assessment.
“Right now, the calculations are done based on an area that’s taking all those mines into consideration,” Fisher said. “Starting in 2026, each mine will have its own area of influence. So the taxes for that mine will only be distributed to the municipalities within its area of influence. So that’s the change that they introduced in 2021 to be effective in 2026.”
Mosaic’s K1 and K2 will both be used to calculate the Esterhazy area of influence until next year, then they will cease to be part of the overall calculation.
“There’s still a substantial assessment at those sites because the processing and distribution facilities are still in operation at those sites,” Fisher said. “So it’s not as though the entire site is shut down, just the mine shafts have shut down.”
An area of influence is defined as being 32.2 km from the centre of the section where a mine is located.
The taxable assessment of potash mines is updated each year by the Saskatchewan Assessment Management Agency, and area calculations can change with factors such as annexation of land by a municipality, dissolution of a municipality, changes in park boundaries, and lands transferred to First Nations reserves.
The document sent out to municipalities used this year’s data for the Nutrien Rocanville and Mosaic K3 mines as an example of what figures could look like in the transition from overlapping to individual areas of influence. The figures are only illustrative of what might occur come 2026 as changes in data will change, but some municipalities are bracing themselves nonetheless.
“We knew it was coming. We didn’t know what it was going to be—it’s a little bit of a shocker there—but we knew we were eventually going to be receiving less,” said Grant Forster, mayor of Esterhazy. At one point, the town was in the area of influence of three Mosaic mines.
“We knew that once K1 and K2 shut down the underground operations that was going to affect the calculation in terms of what we’re covered for,” Forster explained. “K3 doesn’t generate the same amount of assessed values as K1 and K2 combined.”
In the calculation, Esterhazy’s overlapping area is projected to bring in $342,665.66. With the share only coming in from K3, that number drops to $223,526.32.
The biggest upward swing noted was in the RM of Spy Hill, with the municipality noting a $611,436.77 projected increase (based on over $1.53 million this year) for just over $2.1 million forecast in the individual mine total. The RM is one of the fortunate municipalities to receive a potash tax share from both Nutrien Rocanville and Mosaic K3.
Conversely, the RM of Langenburg is slated to note the largest drop— some $391,057.58—projected to receive $776,736.28 at the individual calculation (based on more than $1.16 million overlapping).
The RM of Silverwood and Town of Wapella are slated to receive nothing from the shift to individual totals—a loss of $41,418.49 and $16,286.20 respectively.
Set to receive the largest share is the RM of Rocanville, projected to receive more than $2.21 million in the individual projection, up $480,792.35 over the overlapping calculation. The Town of Rocanville will also note a sizeable increase in the projection model.
“The increase of potash tax sharing revenue that the Town of Rocanville is projected to receive enables the town to provide quality services to our residents along with those in the surrounding communities,” said Tanya Strandlund, Town of Rocanville Administrator. “The funds greatly impact council’s ability to keep property taxes consistent and still provide exceptional amenities within our town.”
The town of Rocanville would see a major uptick in those dollars under the individual calculation, an increase of $207,396.69 for a total of $386,696.14 as opposed to the overlapping area ($179,299.45).
While the numbers listed in the projections are not actual figures, it does help municipalities prepare for future budgets, knowing there will be some change ahead.
