Province to freeze property assessments in 2018 after fumbles this year
The Liberal government plans to freeze property assessments on hundreds of thousands of properties provincewide in 2018 in response to the continuing controversy over inflated tax bills issued to several hundred homeowners earlier this year.
"Your government is taking the necessary steps to ensure public confidence is restored in the property tax assessment process," said Environment and Local Government Minister Serge Rousselle in a statement released mid-day Wednesday
"Freezing assessments in 2018 will help to ensure fairness and predictability."
Cost falls on municipalities
Although a provincial government initiative, the cost of the freeze will fall heavily on municipalities, which rely on property tax as their primary source of revenue.
In Saint John, Coun. David Merrithew, who heads the finance committee, said assessment growth helps the city cope with inflation.
He called the freeze a mistake.
"This is just stupid," he said. "This is an election promise."
"It will force municipalities like Saint John to increase their tax rates. That's what it['s going to do. We've got to pave the streets and pay for police and fire services. It's going to be the same for everyone. Everyone has got to be in the same boat as Saint John is."
The reaction in other communities was equally negative.
On Twitter, Edmundston Mayor Cyrille Simard said he will be looking for more grant money from the province to make up for lost revenue because of the freeze.
"Without compensatory measures, this government decision makes absolutely no sense," Simard wrote.
Petit Rocher Mayor Luc Desjardins responded for himself and the Francophone Municipalities Association.
"This is totally unacceptable," he said.
Merrithew said he could change his mind if the province increased grants to municipalities to make up for the freeze, but there was no indication in Rousselle's initial statement of that happening.
Rousselle did indicate the province would not freeze property assessments that are falling — another problem for municipalities — or assessments that increase because of new construction.
Election in 2018
This year municipalities saw assessments jump $1.1 billion from a combination of new construction and property value escalation. New tax revenue for communities from that increase was $14 million.
The Gallant government is facing a general election in September 2018, and with tax bills issued every March 1, an assessment freeze helps ensure there will be no repeat of the controversy that erupted this year when Service New Brunswick officials struggled to implement a new assessment system.
The roll-out ran into a number of problems, and for reasons not yet explained, ended with assessment managers making up renovation amounts on 2,048 homes to justify large assessment and tax increases on each of them.
Increases have now been rolled back on most of the homes, and Auditor General Kim MacPherson is investigating what went wrong, including claims Premier Brian Gallant's office pushed for the accelerated adoption of the new assessment system before it was fully tested.
