Municipal groups in New Brunswick have called on the province to provide compensation in the wake of the upcoming property tax assessment freeze.
Cities of New Brunswick Association president and Fredericton Coun. Eric Megarity said that freezing assessments means lost revenue for areas throughout the province and without any prior warning it will be difficult for many to adjust.
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“It’s going to create some hardships for some municipalities and some cities,” Megarity said of the government decision. “It definitely ripples right through every municipality’s budget.
“Those budgets drive those services and if we cant find the money to drive those services then we have to cut back somewhere.”
He said the total loss in revenue for the New Brunswick capital is estimated to be $1.7 million.
This loss makes balancing the books for the next year’s budget more difficult for city staff.
“That $1.7 million we have to find elsewhere,” Megarity explained. “And the last few years we’ve been working very hard at doing more with less.”
READ MORE: New Brunswick to freeze property assessments for 2018 while review is completed
Recently the Cities Association, The Francophone Association and the Union of Municipalities met with the Department of Environment and Local Government.
Megarity said the meeting gave them the chance to voice their concerns.
“We asked for three things, one is compensation for the tax freeze, two is any new body that they’re planning to set up we have to be heavily involved because it directly affects the cities and municipalities,” he said. “And three, going forward, the system’s broke, it’s a leaking ship and there’s no more bandage to put on. We have to find a new system.”
In a statement the department said “government believes that a freeze to most assessments until the property tax assessment system has been improved is the only responsible choice,” citing an exemption to new construction and real estate sales from the freeze which should ensure some of the revenue is maintained.
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The government also said the freeze is only for the coming year and therefore shouldn’t have any lasting negative impact on municipalities’ revenue.