Lloydminster‘s 2025 audited financial statements show the city carrying more debt than assets for the first time in recent memory. City administration says that was the plan all along – and the numbers largely back them up.
Finance officer Ryan Hill presented the statements to city council Monday. Council approved them unanimously.
What changed – and why
In 2022, the city held $32 million more in financial assets than liabilities. By the end of 2025, that position had flipped to a net liability of $2.5 million – a swing of more than $34 million in three years.
The driver is straightforward. The city borrowed heavily to build two major pieces of infrastructure – the Cenovus Energy Hub and the wastewater treatment plant. Both projects added significant long-term debt. Both added significant long-term value.
“When you invest in large infrastructure projects, this is what you’re going to see,” Hill told council. “You’re seeing money move from net assets down into non-financial assets.”
In plain terms – the city traded liquid financial position for physical assets the community will use for decades. Roads, utility infrastructure, recreation facilities. Assets that do not generate cash but do deliver services.
Mayor Gerald Aalbers put it in perspective for residents.
“This is a $650 million operation technically, because that’s what we have in assets,” Aalbers said. “Those assets are what we’ve invested each and every day.”
The numbers in detail
Operating revenues grew 13 per cent over 2024, driven by higher user fees, increased utility revenue, a renegotiated water contract, and unbudgeted sponsorships at the Cenovus Energy Hub.
Operating expenses rose 4 per cent – inflation, collective agreement increases, the startup of the new fire model, and the costs of running the Cenovus Energy Hub all contributed.
The city invested $49.7 million into tangible capital assets in 2025. Cash decreased by $30.6 million – largely because the major capital grants for the Cenovus Energy Hub were received and recognized in 2024, leaving 2025 to run on standard annual grants.
On the debt side, the city paid down $3.7 million in scheduled payments and drew no new debt in 2025.
What isn’t in these statements
Here is where residents should pay close attention.
The 2025 statements council approved Monday do not include two significant debt draws that have already happened. The city drew $30.38 million in January 2026 for the Cenovus Energy Hub. Another $3.2 million for the wastewater treatment plant is expected before the end of April.
Hill was clear about this at council – the timing is known, expected, and already accounted for in budget forecasting. But it means the statements approved Monday represent a snapshot that is already materially different from where the city sits today.
When those draws are factored in, the city’s debt limit utilization – currently sitting at 32 per cent – would have been closer to 50 per cent had the timing landed differently. The city’s internal policy caps debt at 75 per cent of the legislated limit.
Hill noted the city is not alone.
“There are more than five or six communities in Alberta alone that have the same situation,” he said. “It’s very normal. It’s just where you are in the investment journey.”
Some good news on debt
Not all of the debt picture is concerning. The city paid off the outdoor pool debt entirely in 2025. Three more debt payments come off the books in 2026 – saving the city $635,000 annually going forward.
As revenues grow and assessments increase, the city’s debt limit itself also grows, which means the percentage of limit utilized should improve over time even without paying down principal.
How does Lloyd compare?
Hill walked council through comparisons against 19 Alberta cities using 2024 data – the most recent available for peers.
Property taxes per capita in Lloydminster sat at $1,583 in 2025 – up from $1,464 the year before but still near the Alberta median. The city generates a higher proportion of its revenue from its own sources – user fees, franchise fees, investment income – than most Alberta peers.
Contracted services costs remain above the Alberta median, driven primarily by RCMP contract costs, snow removal, and pavement maintenance. Hill noted the comparison can be misleading – cities with their own police services carry those costs in salaries and equipment rather than contracted services, so the overall picture is more balanced than the raw number suggests.
What to watch
A few things are worth tracking as 2026 unfolds.
The two debt draws already made this year will appear in the 2026 statements. Residents and council will get a clearer picture of where the debt limit lands at that point.
Operating expenses rose 4 per cent in 2025 on the back of inflation and collective agreements – pressures that are not going away. Some of the revenue drivers that made 2025 a strong year – the water contract renegotiation, unbudgeted sponsorships – are not guaranteed to repeat at the same level.
Coun. Justin Vance asked Hill directly what council should tell concerned residents.
Hill’s answer was measured.
“Every year that debt comes off and you’re not putting major debt back on, it’s just going to get better and better,” Hill said.
Administration noted the city has access to a $5 million operating credit facility for unexpected situations – and has never used it.
The audited statements are available to the public through the city as required under the Lloydminster Charter, which mandates they be made public by May 1 each year.
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