Getting Out from Under CBRM's Tax Paradox

Getting Out from Under CBRM’s Tax Paradox
Rankin MacSween (Transcript)

Friday August 19

Glace Bay, NS


As I have explained in my announcement speech, the Cape Breton Regional Municipality (CBRM) appears to be in a vicious cycle of high unemployment, out-migration and depopulation, and very high property tax rates. Very quietly, over the past four years, total employment in Cape Breton has fallen by more than 6,000 people.

It is my view that once tax rates rise beyond a certain level, they inevitably have the impact of discouraging private investment and, therefore, economic growth. All of the economic data available suggests that CBRM’s economic environment is simply not competitive with other municipal jurisdictions in Nova Scotia.

Although the entire mechanism of funding municipal services and infrastructure in Nova Scotia is badly in need of reform, the reality of the situation is that the government of Nova Scotia does not seem inclined to want to fix the problems that exist.

John Morgan dedicated much of his time as Mayor of the CBRM challenging the provincial government to fulfill its commitment to provide fair equalization funding to municipalities, and I very much believe in the principles for which he was fighting.

My perspective is that there is a need for all three levels of government in Canada to undertake a broad and comprehensive review of the distribution of service responsibilities and revenue sources associated with local government because the available information in Nova Scotia confirms that there are very substantial disparities across municipal jurisdictions in both levels of core services and in tax rates.

Clearly, the Canadian Constitution promises all citizens, wherever they live, access to essential public services of reasonable quality. This is simply not the case in Canada in 2016 and it is certainly not the case in Nova Scotia.

Nevertheless, my complete focus has to be on what can be done to improve the situation within the CBRM. What do we control? We have now had more than twenty years of extremely high property tax rates and more than twenty years of a slow growth economy with a dramatic decline in population.

Instead of controlling expenditures and lowering the tax burden, between 2012 and 2016 the CBRM Council increased total municipal operating expenditures by 6.5%, despite the fact that the total population of the region is declining very rapidly.

This is obviously not good economic policy because it is placing an ever-growing tax burden on a constantly shrinking and aging population.

Economies depend upon small businesses (those with fewer than twenty-five employees) as the engine of economic growth. If small businesses have a supportive economic environment, they will grow and develop; if they don’t have a supportive economic environment, relatively few businesses will be created and fewer still will endure and grow.

Once again, declining total employment figures in Cape Breton clearly indicate that our municipal economic policies are not working. Of equal or greater importance, the total size of the population of CBRM is shrinking by an average of 1,000 people per year, mostly due to out- migration. This means people are voting with their feet and leaving the region in search of a more supportive economic climate.

In order to provide a more supportive environment for the development and growth of small business, one very tangible measure that can be taken by the CBRM is to lower property tax rates.

To provide a clear sense of the disparity in CBRM’s tax rates versus those in other areas of Nova Scotia, specific examples are helpful.

In the County of Cape Breton, for a family owning a $100,000 residential property, the annual property tax bill is $1,920. For a comparable property in Richmond County, the tax bill is $780; for a comparable property in Halifax County, the tax bill is $1,160.

If you use a $100,000 property in Glace Bay as an example, residential property tax would be $2,080 annually compared to someone living in Bedford who would pay $1,210 annually. If the property were located in Kentville, the tax burden annually would be $1,370.

In terms of commercial taxation, the owner of a $100,000 commercial property in Glace Bay pays in excess of $5,200 annually in property tax as compared to a comparable property in Antigonish which would have a total tax burden less than half this amount.

Unfortunately, Mayor and Council seem oblivious to the onerous tax burden that is being placed on CBRM residents and business owners and, instead, CBRM’s total spending continues to grow each year.

Currently, we are taxing our region out of investment and out of growth. This must end.

If elected, I will reduce the tax burden in a measured and responsible way.

My commitment is a significant, consistent reduction of 2.5% in all CBRM property tax rates in each of the next four years and beyond until our rates are in line with those in the Halifax capital region.

By 2020, all property tax rates in the CBRM, residential and commercial, will be 10% lower than the current rates. The estimated annual average saving per household will be on the order of $200.

This is an extremely ambitious plan but it is achievable with proper management. From my perspective, CBRM really has no choice. The current path is unsustainable and we have to revive our economy.

To be clear, as well, my financial plan will also see modest reductions each year in CBRM’s long- term debt.

In every year, a portion of the revenue reduction for the CBRM due to lower tax rates will be compensated by growth in CBRM’s assessment base and my hope is that CBRM’s assessment base will grow by more than 2% annually as we move forward with this economic strategy. My assumption, however, is that CBRM’s average annual rate of growth in total assessment will not exceed 1%.

If elected, I will approach the management of the CBRM with a determination to be fair to all employees. No departments will bear a greater share of the burden to find savings than others.

Each year, identifying the required savings will be a shared effort; however, I am similarly committed to reducing unnecessary travel expenses, consulting fees, studies and evaluations that in my view are too often wasted expenses, producing little of tangible value for the CBRM.

I have dedicated my life to community development in Cape Breton and I am committed to treating all communities fairly.

In Glace Bay, I am committed to the development of the community and to providing the funding support that is required to maintain and enhance key community facilities like the magnificent Savoy Theatre and the BayPlex.

For me, this is all about the future of the CBRM and rebuilding CBRM so that our communities are competitive, healthy and attractive places to live for current and future generations. I can only do this with your help.

We can and must do better!


How can you help? 

You can LIKE or SHARE this post. 

You can LIKE and SHARE our Facebook Page below. 

You can Donate to the campaign, Volunteer with the campaign and/or Request a Lawn Sign

Sign Up for Updates for the latest news, events, and releases from the campaign. 

Posted by
Receive news by email and share your news and events for free on goCapeBreton.com
SHOW ME HOW


1,032
https://capebreton.lokol.me/getting-out-from-under-cbrms-tax-paradox
Gov Election Past Elections CBRM

0

Log In or Sign Up to add a comment.
Depth
seek-warrow-w
  • 1
arrow-eseek-eNo items to display

Facebook Comments

View all the LATEST
and HOTTEST posts
View

Share this comment by copying the direct link.

  • Our Sponsors

Using this website is subject to the Terms of Use that contain binding contractual terms.