Saint John seeks extension for Canaport LNG tax decision

Saint John council is asking the provincial governmentfor a few more days to respond to its offer to repeal the tax break on the Canaport LNG property.

Officials from the city and the province are in talks about the mechanics of the change and the potential impact on municipal budget preparations for 2018.

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Under normal circumstances, the provincial governmentadvances money to municipalities based on the assessed value of taxable property.

If a property owner appeals the assessment and wins, the province absorbs the loss.

But in the case of Canaport LNG, Local Government Minister Brian Kenny has told the city that the provincial governmentis unwilling to bear any portion of the loss resulting from a reduction in assessment value.

Coun. Shirley McAlary authored the motion last year that set the ball rolling to repeal the provincial act that grants the LNG terminal a 25-year property tax concession that freezes the bill at $500,000a year.

Under the property's current assessment of $299 million the taxes paid should be $8.02 million annually.

McAlary says there is now concern that if Irving Oil, the property owner, appealed the $299-million assessment the city could end up having to pay money back to the province.

"If the province had paid us too much money they're going to ask for that money back," said McAlary.

"We don't want to have it done in that way because we need to make a budget up for the monies that we're going to have."

The issue would only be a problem in the 2018 budget year.

In subsequent years, the city and the province would have a much better idea of the terminal's new assessed value.

We're the ones that should deal with it- Coun. Shirley McAlary

The city has asked Kenny to extend the deadline for a response to May 3 from April 30.

That will allow city staff time for further talk with provincial officials and allow for a report to council and final vote May 2.

That's the last regular meeting for the current city council before the May 9 municipal election.

McAlary says she wants the matter settled before the arrival of a new group of councillors.

"It's important because the new members of council that will be coming on you know, really had nothing to do with this issue," said McAlary.

"Everybody that's there now is fairly familiar with it and we're the ones that should deal with it."