The exterior of Saint John City Hall is pictured in this file photo. (Staff photo)
Saint John has made some changes to its proposed 2021 budget after lower-than-expected tax base growth.
The city had budgeted for 1.5 per cent growth, but provincial numbers show growth of just 0.12 per cent, representing new tax revenue of just $147,660.
Despite a $1-million increase to the city’s unconditional grant, the lower tax revenue meant a shortfall of around $715,000.
While the city’s residential tax base grew by nearly $32 million this year, the non-residential tax base fell by $23 million. It comes as many businesses saw lower revenue than normal due to the impacts of the COVID-19 pandemic.
A staff report to the city’s finance committee says the draft budget tabled in August included the flexibility to adapt to tax base growth changes.
“There were additional staff reductions and the balance of the shortfall will be adjusted through transfer to operating reserves,” said the report.
According to the report, there are five fewer permanent positions recommended for approval in 2021. The draft budget had 577 positions while the updated budget has 572.
The city also plans to reduce the amount going to its capital reserve fund by $45,000 to $605,000 and to its operating reserve fund by $527,516 to $377,484.
“The City’s operating reserves still has the flexibility to mitigate potential impacts of COVID 19 and other one-time emergencies,” said the report.
The updated $157.3-million budget is expected to come before Common Council on Monday.
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