Wednesday, December 08, 2010

O'Brien wants to talk tax-rate cut - Relief Councillor says it's time to look at options
(as publsihed in the Daily Gleaner, December 08/10)

The chairman of Fredericton's finance committee is challenging his council colleagues to debate a tax-rate reduction.

Because Fredericton's tax base has grown 4.88 per cent in 2010 and with city council's attempts to rein in all unnecessary spending Coun. Mike O'Brien feels it's time to at least give taxpayers a bit of relief.

"I think that with the additional revenue that we've had and some of the service reductions that we've already identified and other ones we've gone through in the last few nights - and if we had the will to do it as a council - that we would be able to find enough savings to consider reducing the tax rate, even if it's a slight amount," O'Brien said at a budget meeting Tuesday night.

The councillor said he's going to make a pitch to his council colleagues to hold that discussion even though he's already hearing some councillors aren't happy with the tax-rate reduction proposal.

"I think that in this time with the issues that are going on with the province and with the way that people voted provincially for restraint and change that it's incumbent on council to do our absolute best to do that.''

At the very least, O'Brien said, taxpayers shouldn't have to pay a higher tax rate in 2011 and he's confident council can pull it off.

In 2010, Fredericton city council voted to increase taxes by 0.85 cents. That put the city's tax rate at $1.42, from $141 per $100 of assessment. For a home valued at $150,000, the rate increase meant an additional $70.18 per year. It was the first tax rate hike in seven years.

But property taxes are made up of two components, the tax rate and the assessment on a property. Even if the rate remains the same, if a home's value rises, then so will the tax bill.

With all the work councillors have been pouring into reviewing services - much of that discussion behind closed doors because of the implications for cutting personnel - O'Brien said he doesn't think Fredericton is going to have a budget ready before the end of the year.

Traditionally, Fredericton has filed its annual operating and capital fund budget by the end of December. But O'Brien said there's another budget meeting set for Dec. 15 to talk about the contentious issue of how much money to hand out in grants and to decide who receives them.

Nor has council run through a final version of the operating budget proposals for each department. For that reason - and given the timing of the Christmas holidays - O'Brien said he can't imagine having the document pulled together before Christmas.

The finance chairman said he wants to be sure that the province isn't going to download additional costs on the city between now and February.

With an open budget process, O'Brien said, it's a learning curve for council too. "I just don't see how we can have a budget ready before Dec. 31.''

At least one councillor is publicly supporting O'Brien's call for a debate. Coun. Jordan Graham wants to have the tax-rate reduction talk as part of the current round of budget preparation meetings.

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