The city of St. John’s is raising land and water taxes on its 2022 budget as part of its plan to address a projected deficit of $ 13 million.
The city is not cutting spending on transportation and snow removal, and Ron Ellsworth, chief city councilor for finance, said an increase in taxes was necessary to keep the budget in balance while maintaining these services.
“Our plan for 2022 is to maintain the level of service and make small investments to improve the services that matter most to you,” said Ellsworth.
The residential mill rate will increase 0.6 million to 8.3 million, while the commercial mill rate will increase 0.8 million to 26.9 million, which the city said will help add to the lost revenue remedy. Taxes are calculated by multiplying the estimated value of a property by the mill rate and dividing by $ 1,000. A property valued at $ 250,000 in 2021 paid $ 1,925 in taxes and will pay $ 2,075 in 2022, an increase of $ 150 per year.
The city expects to earn $ 3.4 million more from homeowners and nearly $ 4.2 million more from commercial property owners, and to collect $ 1.2 million more from water fees, a tax increase of nearly $ 9 million. Dollar compared to 2021.
The city says spending will increase by $ 10 million in 2022 due to payrolls, debt payments, fleet maintenance costs, and other obligations.
The boroughs of Newfoundland and Labrador are required by provincial law to balance their budgets, and this year the city of St. John’s has a balanced budget with spending of $ 319,603,486, 2.3 percent more than the 2021 budget of 312,526 $ 525.
The St. John City Council voted unanimously in favor of the budget, although some expressed reservations about certain aspects, particularly the increased taxes.
“Neither of us is happy about this budget, but it’s the best budget we can develop and advance as a team,” said Ellsworth.
Address the deficit
Due to the general decline in property values ââdue to revaluations, the tax burden will not increase for everyone: 70 percent of homeowners will see an increase, while 30 percent of homeowners will keep their taxes the same or go down. Nineteen percent of home owners will hike their taxes by more than $ 120 a year.
The city also says that just over half, or 55 percent, of commercial property owners will have their taxes go up, while taxes will stay the same or go down for the rest.
The water tax will increase by $ 5, from $ 620 in 2021 to $ 625 in 2022; The city expects to generate about $ 500,000 in revenue from this increase, though it says the money will go towards maintaining water supplies.
According to the city, 1,100 people visited the city’s public budget engagement page, but only 76 participated in online discussions.
St. John’s expects to generate 68.2 percent of its income from taxes in 2022.
In some areas, expenses are increasing, for example for snow removal, transportation and maintenance costs; However, Ellsworth noted that most of the additional spending doesn’t mean too significant a change in the level of service.
“Although it would not be responsible to present an austerity budget, it would also not be financially responsible to significantly improve the level of the services we offer,” he said when presenting the budget.
The city will spend $ 510,000 to add a third layer of snow removal on the sidewalk. Snow removal, especially on sidewalks, is a hot topic for the city and residents protested in 2020 for better snow removal on sidewalks.
During the council meeting, Count. Maggie Burton noted that while the third shift in snow removal will be operational this winter, it won’t be fully operational until the city procures more equipment for that shift.
St. John’s will spend $ 19 million on transportation in 2022, including a new service the city says will run more frequently on major Metrobus routes. The paratransit costs will also increase in 2022 due to the higher number of passengers.
Burton said she would have liked a bigger increase in spending on snow removal and sidewalk transportation, but that was a step in the right direction.
Downtown pedestrian streets are slated to return in 2022, with additions for the provincial Come Home Year 2022 celebrations.
The city expects to spend $ 445,000 on preparations for the 2025 Canada Games, although the Games are expected to have over $ 77 million in economic impact.
The workforce will be increased by 6.27 posts, some of which will cover the new layer of snow clearing on the sidewalk. The city is also adding a position as an internal auditor to assist with “best practices for good corporate governance” and a new marketing position to “support economic development opportunities”. The city has around 1,100 full-time positions.
The city says it is also spending more on maintenance due to higher equipment and parts prices.
Although the city made minor cuts in some areas, such as cutting administrative spending by $ 280,000, there were no significant cuts in the 2022 budget.
During the session on Monday, Con. Jamie Korab said it was difficult for the council to make additional spending cuts without impacting core services.
“There’s not much meat left on the bone when you go through it all,” he said.
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