Service New Brunswick

Phase-in of industrial property tax assessments (02/09/24)

NB 933

Sept 24, 2002

FREDERICTON (CNB) -- Increases in the property tax assessments for 62 properties owned by New Brunswick's biggest industrial employers will be phased in over the next three years. The announcement was made today by Business New Brunswick Minister Norm Betts, Minister responsible for Service New Brunswick.

Business New Brunswick Minister, Minister responsible for Service New Brunswick Norm Betts Video- Quicktime Movie (1) (2) Microsoft WMV (1) (2), Audio - Quicktime (1) - (more audio/video)

Betts, Finance Minister Peter Mesheau and Environment and Local Government Minister Kim Jardine met with representatives of both industry and municipal government in Fredericton today to explain the phase-in period and signal their intention to introduce the necessary legislation this fall.

"This is a very balanced approach to an issue that affects some of the major employers of this province and some of our municipalities," Betts said. "A three-year phase-in will allow the industry time to adjust to the planned increases and will provide increased revenues to most municipalities - totalling more than $5 million by the end of the phase-in. It will also help improve the ongoing tax competitiveness of New Brunswick industry. It is our goal to be the best jurisdiction in North America in which to do business and this decision continues us on this path."

In November 2001, Betts and Finance Minister Peter Mesheau announced a freeze on the property tax assessments of 62 heavy industrial properties throughout the province. At the same time, they also announced a comprehensive review of property tax assessments for heavy industrial properties, to ensure the Province's property tax regime did not act as a barrier to job creation and economic growth in New Brunswick.

While the review of assessment practices found that New Brunswick operates in much the same way as other jurisdictions, certain U.S. states assess fewer items than New Brunswick. In particular, the heavy industrial electrical systems, known as 'power wiring' as well as the foundations under heavy machinery, are not assessed in some states where competitors to New Brunswick heavy industries are located. Betts said he will introduce amendments to legislation this fall to remove these two items from the assessment base.

In 2000, a two-year project was launched to review and update the assessments on 62 of these properties over two years, including 10 mills and one shipyard for 2001, and 51 sawmills, food processing plants, mines and power plants for 2002.

When the decision to freeze these property assessments was made last November, the overall economic downturn, and the particular pressure on certain sectors of the economy, led government to believe that an increase in property taxes on these heavy industrial properties would be detrimental to the economic development of the province. Therefore, the freeze and the review were initiated.

"The coincidence of an economic slowdown with these assessment increases may have forced these industries to make major cuts elsewhere - likely in their labour force and in future capital investments," Betts said. "We felt this put the economic health of communities and the province at risk, and we moved to protect these jobs and the economy. History has shown that it was the right move at the time. This new three-year phase-in will continue with our prudent and balanced approach in this area."

02/09/24

EDITOR'S NOTE: A chart showing the breakdown of heavy industrial assessments is attached. MEDIA CONTACT: Brent Staeben, director of planning and communications, Service New Brunswick, 506-453-6775.

Heavy Industrial Assessments by Industry Type

02/09/24

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