Saint John Mayor Reacts To Local Governance Reform

Saint John’s mayor is commending the province for taking on the issue of local governance reform.

But Donna Reardon says the 68-page white paper released in November month is lacking in some areas.

Reardon said in an interview that her council was expecting to see more comprehensive property tax reform sooner.

“The way the assessments were done, to have that looked at at least, how the tax money was distributed out to the municipalities versus the province,” said Reardon.

Reardon said municipalities get all of the residential property taxes paid to the province, but only some of the non-residential taxes.

That creates challenges for an industrial city like Saint John, where more than half of the tax base is non-residential, she said.

“That’s a big difference,” said Reardon.

In recent years, Saint John unsuccessfully asked the province to turn over its share of the tax collected from heavy industry, which Reardon said would have amounted to $8 million a year.

“Those things make a big difference in your budget when you’re a city with a tax rate of $1.78 [per $100 of assessed value] and your tax rate needs to be that high for you to provide those services,” she said.

Saint John council is in the process of approving its 2022 budget, which would lower the tax rate to $1.71. But that was only possible due to massive property tax base increases, which are mainly due to market adjustments rather than new construction.

Reardon said it is hard for an industrial city like Saint John to hang onto its residential tax base, pointing to a Gardner Pinfold report that said industry tends to drive residential development to neighbouring communities.

The local governance reform white paper says the province will explore “reducing the provincial property tax rates for business property owners”, among others, but that it will not happen until 2024 at the earliest.

“We were under the impression that we would have tax reform by 2022,” said Reardon, referring to a provincial commitment made as part of the city’s overall sustainability plan, which saw the city make a number of cuts in order to close an anticipated $10-million structural deficit in 2021.

“We’ve cut services, and that’s where we’ll stay,” she added.

Amalgamating Greater Saint John

Last week, a Liberal MLA questioned why Saint John would not see any restructuring as part of the province’s local governance reforms.

In order to reduce the number of municipal entities from 340 to 90, several municipalities will be merged into larger local governments while other communities will be expanded to include parts of surrounding local services districts.

But a number of municipalities — including Saint John, Quispamsis and Rothesay — will not see any changes to their boundaries.

“The minister of municipal reform forced amalgamation everywhere else in the province and it was Saint John that needed it the most,” local governance critic Keith Chiasson said during question period on Nov. 25.

Chiasson, who represents Tracadie-Sheila, said the city is challenged to provide services over such a large geographic area, and the premier had a chance to fix that through the reform.

“The communities of Quispamsis and Rothesay are closely tied to Saint John and many community members work in the city and use its facilities,” he said. “There would be tremendous opportunities for efficiencies and a new amalgamated community would be a sustainable one.”

Reardon said she thinks regional cooperation is “probably the ticket” for Greater Saint John.

“If you were going to put together those communities, I would think all of us would like to see some sort of a business case on how that’s going to work out for everyone,” said Reardon.

Premier Blaine Higgs pointed to the collaboration that’s been done in Greater Saint John in recent years, including the creation of a new regional economic development agency — Envision Saint John — which the province committed up to $10 million toward.

“That’s just a springboard of what we’re going to see going forward where we have all aspects of what goes on in that region being supported by the outlying areas, but doing so in a cooperative, listening format,” said Higgs.