Councillors at odds over whether CBRM tax cut will hurt services

Councillors in Cape Breton Regional Municipality voted last week to cut tax rates for both residential and commercial properties by five per cent, but without laying off staff or reducing services.

The five per cent decrease, which passed by a vote of 8-4, means a loss of $3.65 million in revenue for the coming year.

Municipal staff suggested, however, that to reach that goal there may need to be cuts in services, such as sidewalk and road repairs, and less money allocated to the Port of Sydney, the Centre 200 sports facility and the regional library.

Some councillors aren't sure the tax cut is the best option. 

"I fear that other things will suffer as a result," District 3 Coun. Cyril MacDonald told CBC's Information Morning Cape Breton. "When your pothole doesn't get filled this year, you're welcome, you got a five per cent tax decrease."

MacDonald voted against the tax cut. He said he thought it was fiscally irresponsible to have a five per cent decrease this year, and that it should have been phased in. "We're doing it the wrong way," he said.

MacDonald said projects in the community may not get done this year or may be delayed. He said he heard from residents who wanted the money to be spent on sidewalks, roads and services instead of a tax cut. 

"I've talked to a number of residents since we voted last week, and they've all said, 'Well, I guess my road isn't getting paved this year.' And I said, 'Yeah, you're probably right,'" MacDonald said.  

District 1 Coun. Gordon MacDonald voted in favour of the tax cut, and said he believes there's money available, noting a $15.3-million top up of the municipal financial capacity grant from the provincial government.

"I don't believe we had to go looking. There's revenues coming in," he said. 

"We have a fairly good revenue stream in that capacity, so why not give it back? This is what equalization was for. This is why the premier decided to give us an extra $15 million."

MacDonald said he spoke to residents who were asking for some kind of tax relief. "With the extra flow of cash, some of us felt that it was time to give some of that back to the residents of the CBRM." 

Council and municipal staff "should be able to find the money and not have any of those services affected," he said. "I don't believe any of our projects are going to be at risk."

But Cyril MacDonald noted the $15 million increase the CBRM received from the provincial government isn't a sure thing in the future.

"I'm quite fearful that our current government next year doesn't honour the promise and double our transfer payment again," he said.

He said he doesn't want to cut taxes this year, only to have to hike them next year.