Upbeat mood in St. John's as council adopts 2015 budget

Homeowners and entrepreneurs in St. John's received an early Christmas present Monday with news that city council will not be raising taxes in 2015.

Despite an increase in spending of more than six per cent, council managed to once again hold the line on tax rates in adopting a $289.4-million budget.

• Click here for more details of Budget 2015

"The city's finances are being well-managed," Coun. Danny Breen, who chairs the city's finance and administration committee, told reporters prior to Monday's public meeting.

The mood was one of optimism and pride as councillors, one-by-one, praised the budget as a document that benefits the city and its citizens.

The only opposing view came from at-large Coun. Art Puddister, who voted against the budget.

He said the city cannot sustain the current level of spending, and said the time had come to start reigning in expenses.

The St. John's Board of Trade also endorsed the budget, with chairperson Sharon Horan expressing support for the city's decision not to increase taxes.

Steady growth for city

The talk Monday was largely about the city's ability to invest heavily into infrastructure needs in recent years, give breaks to seniors and serve as good stewards over the taxes that are collected each year.

"This is a good budget," said Mayor Dennis O'Keefe, adding that the city is "on the right track."

According to Breen, revenue projections are routinely surpassed, driven largely by the city's continued growth.

Breen said it's likely the city will finish 2014 with a surplus, while Ward 2 Coun. Jonathan Galgay added, "I'm proud to be part of a city that invests back into the people."

A new formula for collecting business taxes is also ensuring that more business owners are paying their fair share, said Breen.

The increase in expenditures was attributed to added costs in areas such as employee salaries and wages, water infrastructure improvements and enhancements to snow clearing services.

"I think we’ve reached a very fair balance overall," Breen said.

City being fiscally responsible, says Breen

This marks the final year of a three-year budgeting process, which was highlighted by a $300-million infrastructure strategy.

"We've been able to deliver on these infrastructure improvements … in a very fiscally responsible way,” said Breen.

"Anyone that's driven around the city can attest to the works that's been done."

Breen stressed that more investments are needed. He referenced the need to replace the Mews Community Centre, and begin planning for a new secondary wastewater treatment facility that could cost upwards of $200 million.

And once again, there was talk about the need to reach a new fiscal arrangement with the provincial government.

Deputy Mayor Ron Ellsworth, who chairs the regional water committee, said the province is not paying its fair share.

He called upon the city to install metres on its buildings in the city and pay for its share of water consumption

Meanwhile, here are some highlights of the budget:

• The residential tax rate will stay at 8.1 mills for 2015. The business rate remains at 26.2 mills. Water rates also frozen.
• Taxes from businesses will increase to $62.4 million in 2015, but 3.7 per cent.
• Despite no increase in rates, water tax revenue will grow by three per cent to $53 million.
• Senior citizens will continue to receive a 25 per cent rebate on taxes, but a new interest-free payment plan will also be implemented for qualifying seniors. This will impact some 1,200 households;
• Some councillors expressed disappointment that more could not be done for low income owners.
• Metrobus users will not see a fare increase in 2015, thanks largely to an extra $300,000 contribution from the city.