City seeks new financial arrangement

Dave Bartlett
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St. John’s Mayor Dennis O’Keefe speaks to The Telegram from the mayor’s lounge at city hall last week. The city is working with St. John’s MHAs to improve communication between both sides. — Photo by Dave Bartlett/The Telegram

Improving relations between the city of St. John’s and the province has been an issue slowly simmering on the back burner at city hall.

Some city councillors have been turning up the heat in recent months, advocating for regular meetings between the two levels of government.

According to Mayor Dennis O’Keefe, members of council met with some of the Tory MHAs who represent city districts about

two weeks ago to discuss how

both sides can communicate better and address a number of ongoing issues.

The city also plans meetings with the leaders of the Liberals and the NDP — Lorraine Michael represents the city’s Signal Hill-Quidi Vidi district.

But O’Keefe describes the current relationship between city and government as “excellent.”

“We have an extremely good working relationship with the provincial government,” he told The Telegram late last week.

While O’Keefe has recently met with Municipal Affairs Minister Kevin O’Brien on a few issues, he also has regular contact with Natural Resources Minister Shawn Skinner, the MHA for St. John’s Centre.

The city views Skinner as the go-to guy on general issues. He is also a former city councillor.

During the recent meeting, council pitched three areas where it was looking for provincial help.

While there are a myriad of other issues — including the city’s hope the province will help pay for school crossing guards in the future — the most pressing issues are long-term, multi-year capital works funding, a “different” fiscal arrangement between the two entities and allowing development above the 190 contour line.

The 190 contour is a line of elevation, above which the province has banned development. The city wants that rule changed, even though new water pumping infrastructure would have to be built to service these high elevations.

But O’Keefe said about a half-billion dollars worth of development is contingent on that change, which means revenue for both the city and province.

Two examples of areas above the 190 are the area between Southlands and Cochrane Pond and an area higher up on Kenmount Road.

But, the mayor said, the most important issue the city wants the province to change is its financial relationship.

Currently, the city gets a $3-million annual operating grant from the province, and capital works projects are split 70-30, with the province paying the lion’s share.

However, O’Keefe said the city is willing to forgo the grant and pay half the cost of major projects if the province is willing to start paying for its building permits and taxes on provincial buildings, from which it is currently exempt.

The federal government does pay the city taxes on its buildings, and the redevelopment of the Canadian Forces base in Pleasantville brought in $750,000 in development permit revenues.

“We pay more in taxes to the province than we get back from them,” said O’Keefe. “(But) we’re not saying, ‘gimme, gimme, gimme.’ We’re trying to be fair on this.”

The mayor said the city doesn’t expect to get everything it wants.

“We don’t live in Disneyland. We know that we’re not going to get everything we’ve put on the table,” he said.

But, he said, if the province does grant all of what the city wants, it would be a boon in the millions.

“If Santa Claus came to the City of St. John’s and we developed this new relationship fiscally with the province … the net benefit to the city would be around $22 million annually,” O’Keefe said.

To keep these issues on the province’s radar, both sides have agreed to create a four-person working group which would have O’Keefe and Skinner as members along with another city MHA and another member of council.

Currently, both sides meet about once a year, but the hope is the working group can meet as often as every couple of months.

Overall, O’Keefe wants all city MHAs to “go to bat” for St. John’s on important issues, regardless of political stripe.

Skinner agrees a working group is long overdue and is something he advocated for when he was on council.

“I’m glad we’ve finally got to the point where we’ve got a working group formed,” he said. “We’ve had meetings in the past where it’s been MHAs and councillors, but (there’s) too many people in the room, too many cooks in the kitchen to make a decision.”

The small group aims to keep discussions focused.

Skinner thinks the 190 contour issue will be fairly straightforward as long as the city builds the necessary water infrastructure.

But he said the other issues, especially a new funding arrangement for St. John’s, will take some time to put together due to their complexity.

The minister said if re-elected next month and put back in cabinet, he plans to advocate on the city’s behalf come provincial budget time.

While not officially the city’s representative in cabinet, Skinner said he’s more than happy to take on that role as a city MHA.

Organizations: NDP, The Telegram, Canadian Forces

Geographic location: Southlands, Pleasantville, Disneyland

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Recent comments

  • Pete
    September 19, 2011 - 10:20

    Athens existed befor Greece, Rome before Italy, London before England but cities are now at the mercy of the province. However they had their chance at the Meech Lake and Charlottetown Accord discussions on division of powers, but were silent. A Tax can only be legislated. City councils are not legislatures. Municipal Corporations are only supposed to collect fees for services, but are used as a back door tax collecton agency for the Provinces and Ottawa. Citizens on subsistance fixed incomes in their homestead with a mortgage paid off pay no income tax to the province or Ottawa - nice MHAs, MPS - but are nailed with property tax and fees for water whether they use it or not until they are forced to sell. Some unexpected bills and Nan and Pop better get back to work if they want to stay in their home!