Taxes steady; water rates rising

Dave Bartlett
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Council passes unanimous 2012 budget

St. John’s city Coun. Danny Breen, chairman of the finance committee, presents the city’s 2012 budget during the council meeting Monday night. — Photo by Joe Gibbons/The Telegram

The city of St. John’s won’t raise property or business taxes in 2012, but water bills will go up about six per cent.

That means home owners will have to pay $35 more in the coming year per residential unit, while businesses with water meters will see the six per cent added to the cost based on how much water they use.

On Monday, city council unanimously approved the budget for the coming year, something that hasn’t happened since before the last municipal election.

The chairman of the city’s finance committee, Coun. Danny Breen, delivered the budget and announced a $3.4-million surplus, and a savings on expenditures allocated for 2011 of about $300,000.

The rate of growth on city expenditures has been more than halved from last year’s 8.9 per cent to 4.3 per cent.

Unprecedented growth in the city over the last five years is credited with the good news on taxes.

“Revenues from all sources have increased by 36.8 per cent or $63.3 million over (that) period,” Breen said. “But the cost of running the city has also increased.”

During the past year the city asked each of its departments to try to find ways to cut costs within their budgets and Breen credited that for keeping the rate of growth under control.

The city won’t cut services in the coming year, and a number of them — including Metrobus, Paratransit, sidewalk snowclearing, fire protection and recreation —  will get an infusion of cash.

The budget also noted the importance of the arts, culture and history of the city.

“We must also be mindful not to allow economic prosperity to override a firm desire to maintain and nurture the unique culture and heritage of our beautiful city,” said Breen.

But the city also used its budget to criticize the provincial government, and appeal to it for more help.

St. John’s will pay $128,000 during the coming year to continue the school crossing guard program.

“The city is, however, more than disappointed that neither the provincial government nor the Eastern School District have stepped up to assist the city with this program,” said Breen.

 The city cut the program in last year’s budget — as education is a provincial responsibility — but reinstated the program after the province refused to take it over.


The city also plans to build 23 new affordable housing units, to add to its current 426. But Breen slammed the province, who is a funding partner in the project, for charging the city HST on the construction of those much-needed homes.

Coun. Tom Hann also took a swing at the province’s lack of help with public transit.

“They charge us ... $380,000 (in fuel and other) taxes to drive our buses on our streets which we maintain,” he said.

The city has already asked the province to negotiate a new financial arrangement with it, and other towns and cities.

The business community applauded the budget.

“It has no increases in tax, it curtails spending which has been a big concern of ours,” said Nancy Healey, the CEO of the St. John’s Board of Trade. “Just having a budget speech articulates a vision and the priorities ... of where the city wants to go.”

“We’re really pleased with it,” added Bradley George, the director of provincial affairs with the Canadian Federation of Independent Business. “ranted there was an increase in water tax but we’re glad to see the property taxes stay the same.”

Budget highlights include:

‰ Seniors who meet the city’s criteria will continue to get a 25 per cent discount on their taxes.

‰ The sidewalk snowclearing budget will almost double, with an additional $250,000 going to hire new workers and for supplies and $450,000 for three new sidewalk snowplows.

‰ Metrobus will get 30 new buses at a cost of $14 million, with nine of them expected to be put into service in 2012. The city’s new bus depot is also scheduled to open in the coming year. The Paratransit budget is getting about a 30 per cent increase, with a new operator taking over the service in the new year.

‰ The city will pay $200,000 to design a new fire station in the city’s west end, with the hope that construction on the new hall be completed in 2013. The city will also call for tenders for two new pumper trucks in the new year, and has allocated $760,000 to buy them.

‰ The city’s credit rating is set at Aa2, the same as the province’s. That means taxpayers will pay about $175,000 less a year to service the city’s debt over the next two decades.

‰ Banks will now be charged a $15 transaction fee for collecting property taxes from people who have rolled that cost into their mortgages. That’s expected to bring a half million dollars into the city’s coffers.

‰ Building fees for single- and double-family homes will be going up — about $500 to $600 on a $300,000 home — to bring those costs in line with commercial development. The $660,000 that change is expected to bring in is to help pay for the cost of city building inspectors.

‰ The city’s capital works budget will be announced in the new year, but recreation will be have high priority. It’s hoped the Mews and Wedgewood Park community centres, as well as a new multi-purpose centre, will be approved depending on help from the province and Ottawa.

Organizations: Eastern School, Board of Trade, Canadian Federation of Independent Business

Geographic location: Wedgewood Park

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Recent comments

  • Political watcher
    December 13, 2011 - 14:06

    It is good to see all the real estate agents here defending their role in increasing housing prices and that they are set by the buyers. Well, what is the reason for all the "Free Market Evaluations" that I receive in my mail box from agents for? They are the ones conducting the evaluations. The way the system works is that two agents get together at a coffee shop; agent one says I will ask X dollars for this property, you counter with X dollars and I will tell them that it is a good counter offer and that they should accept. If anyone thnks that this is not the way it is done is sadly mistaken. Why do you think the agents fought for years to keep independent agents out of the MLS? The independents actually work for the homeowner and not agency. I have been saying for years that half the reason for the high prices is the fault of the agents artificially inflating prices for the higher commission.

  • Turry from town
    December 13, 2011 - 11:59

    If the house next to me is identical,and it sold for say 200,000,and I wanted to sell mine a couple of months later,a realestate agent would look at it and say lets put your on the market for 250,000.If you get 225,00,then you just increased property values by 10% or so. If a developer sells a house for 200,00,the next one he builds will cost 225,000.The cost of materials has not gone up that much in that short period of time.And if an electrician wires a house for 10,000,the next one he will be charging 14,000,or his compitition will. So yes,these are the greedy people who are inflating house prices and therefore taxes.

  • Turry from town
    December 13, 2011 - 11:38

    CHAD..... I understand how the realestate market works.I should have included greedy home sellers.But agents overprice houses intentionally and developers jack up the price for higher profits.Add that to a limited trades workforce,and the price skyrockets.People are forced to buy out of fear they will never be able to afford a home if they don't buy now,hence creating a frenzie.This increase in value,which is of now benifit to a person who plans on staying in a home,has a negative effect because council uses this inflated value to determine property tax instead of charging homeowners for the amount of service they require.Every year the value of my house goes up,along with my taxes.If they want to hold the line on taxes,then drop the millrate.Taxes would then level off.Higher taxes mean people will relocate outside the city to evade taxes,and remaing residents will be paying the lions share and also for those who commute to work everyday and pay nothing towards road maintenance and infastructure.

  • John
    December 13, 2011 - 11:33

    I pay taxes, however not only do I pay the tax amount, but a %fee for having the payment taken out of my account per month. I would bet most taxpayers pay this way, as paying in one lump sum hurts. I wonder how much money the city makes from this percentage, and what happens to it?

  • Kent
    December 13, 2011 - 09:51

    I think residential water meters should be mandatory. Why should we all pay the same ammount when some consume far more of the resource than others? We don't do this with electricity, gasoline, or food. Some households consume huge amounts of water, while others use far less. There are countless homes in my area that regularly use their hose to clean their driveway or wash their car once a week, wasting gallons of water each time. If they had to pay for it, they would think twice about this foolish practice. Use a broom if you need to clean your driveway.

  • bc
    December 13, 2011 - 09:43

    I like how they said they banks will be charged $15.00 transaction fee for collecting taxes on mortgages. Really and who do you think the bank is going to be going after for that $15.00, us of course. Really this budget is not doing anything for me except having me pay out more money for less services. I am paying through the roof for property taxes. I did not see anything in the budget that says they will not give themselves a big hefty raise on the taxpayers backs when the time comes. I say get rid of the all. It's time to clean house and get some new young blood in there.

  • Bill
    December 13, 2011 - 08:40

    Rate of growth on expenditures is just 4.3% and revenues are up a whopping 36.8%. So why with the big increase in revenue is the water tax being increased by 6%? Is this to cover the cement boondoggle at the water treatment plant? Why won't lawsuits reimburse the City for the monies lost as a result of this fiasco? Why are the Mayor and Councillors so accepting of the fact that there was a major screw up that caused the City to loose out on Stimulus Funding? Not to worry, let the residents pay for it! This is just smoke and mirrors as the property assessments will ensure that the property tax revenue will continue at a higher dollar cost to all residents.

    • Eli
      December 13, 2011 - 12:10

      That cement screw-up is the first thing that came to my mind BILL when I saw the headline to this news. Still can't figure why there wasn't any council oversight on the quality of the cement being used. Someone in the engineering department was asleep at the switch. I like the 25% seniors discount. Perhaps someone could elaborate on the city's criteria.

  • Peeved
    December 13, 2011 - 08:23

    Will the Goulds be getting their sidewalks cleared, seeing that they don't have any. No bike lanes either. It's only been a generation since the Goulds was forced to join St. Johns, yet raw sewage continues to run into open ditches. Is culture and heritage more important than public health?

  • Townie
    December 13, 2011 - 08:04

    Just curious. How come with all business construction approvals of $500 million per year Curly Hann and Moe Tilley keep talking about the Business Realty Tax is only increasing by $100,000? Were some taxes reduced?

  • Jordan
    December 13, 2011 - 08:00

    Real estate agents don't set the price of houses, buyers and sellers do.

  • Turryfrom town
    December 13, 2011 - 07:06

    How can anyone say taxes are not being increased?The city relies on the estimated value of your property, driven skyward by greedy realestate agents and developers, to set your taxes with no change in services.They sit there with tongue in cheek and say they will hold the line on taxes.If that were true,the millrate would be dropped and you would pay the same tax as you did lastyear.Look past the somke and mirrors,our taxes are going up!Council are just letting something else drive it.

    • chad
      December 13, 2011 - 10:25

      @Turryfrom town, It is not the result of Real Estate agents or Developers that are driving the growth in the housing market. Simply, buyers are the ones that set the market value on a property. You can list the property for what you want and if you don't price for what a buyer feels is exceptable the house won't sell. The agent is there to negotiate the best deal for the party he/she works for and to have the contracts in place to keep all partys leagley bound. When it comes to priceing a property for sale, an Agent can only offer their opion for what it could sell for based on a study of the area and what other propertys SOLD for.