City of Saint John s Position Paper on Local Governance Reform City of Saint John. Position Paper on Local Governance Reform.

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1 City of Saint John s Position Paper on Local Governance Reform City of Saint John Position Paper on Local Governance Reform September 2012

2 City of Saint John s Position Paper on Local Governance Reform INTRODUCTION On July 30 th, 2012, the City of Saint John Common Council committed to developing a position on local governance reform, which would be shared with the City s partners, including the Government of New Brunswick. The objective behind developing the City s position was to strengthen the current local governance system for the benefit of the City of Saint John, municipalities, local service districts and the Government of New Brunswick. While this position paper should articulate the City s direction on local governance reform, we also hope it contributes to the broader pan-provincial conversation. The City of Saint John acknowledges the difficulties in reforming local governance, and is encouraged by the Government of New Brunswick s announcement in December 2011 for an Action Plan for a New Local Governance System in New Brunswick. The 23 different studies to examine local government in New Brunswick over the past 20 years are indicative of the challenges and complexities tied to local governance reform. 1 The City of Saint John believes that New Brunswick s local governance structure is well-served by increased coordination and cooperation, and the City will use this opportunity to expand upon long-standing relationships with the Government of New Brunswick, municipalities within the region, the Cities of New Brunswick Association, the City of Moncton and City of Fredericton, as well as municipalities and local service districts from across New Brunswick. The current dialogue on local governance reform in New Brunswick cannot be removed from the global economic context as well as the financial challenges faced by all three levels of government. Similar to the Province s Government Renewal Program, the City of Saint John has also initiated a core service review, which mimics efforts from all governments to identify savings and new revenue streams. In these difficult times, governments have a responsibility to cooperate in order to support a strong quality of life for citizens. It is this quality of life indicator that must be considered in all governmental austerity measures, including those measures that impact funding between two levels of government. 1 Finn, Jean-Guy, Building Stronger Local Governments and Regions: An Action Plan for the Future of Local Government in New Brunswick, November 2008, Page 6 [available at:

3 City of Saint John s Position Paper on Local Governance Reform The funding and legislative tools allotted to local governments by other levels of government play a central role in supporting a strong quality of life for citizens. Whether it is through road infrastructure, clean water, wastewater, transit services, safe neighbourhoods, crime prevention, arts and culture, or recreational facilities, municipalities are inherently involved in the delivery of services that impact the lives of citizens. These services support an environment where citizens and businesses want to invest in their communities, continue their education, pursue careers, and raise families. The City of Saint John is committed to work collaboratively with all levels of government to support citizens, which is why the City embedded this principle in its 20 year community goals: Our City plays a leadership role with other local, provincial and national elected officials to address common challenges and opportunities for our community. 2 Similar to what the Government of New Brunswick is experiencing, the City of Saint John has had to rely on alternative measures to cover financial shortfalls, as costs to deliver services have increased. The majority of Saint John s funding shortfall has been recovered by tax-rate increases, tax-base growth and internal austerity measures. With one of the highest tax rates in the province, the City of Saint John must now be cautious not to simply seek additional revenue through property tax, as it may result in adversely affecting Saint John s competitiveness with other centres in the southern region, New Brunswick, and Atlantic Canada. This signifies that the City must have the financial and legislative tools to fulfill its service mandate in an efficient and effective manner. PART ONE: GENERAL A) The Government of New Brunswick should provide more clarity on the role all local governments will have in rebuilding a stronger, healthier, and more innovative province. 3 The discussion on local governance reform is currently focused on very specific components of the local governance system, instead of a discussion on the larger issue of redefining or strengthening the relationship between the Government of New Brunswick, local governments and their respective roles and responsibilities. 2 City of Saint John, Our Saint John, November 2007 [available at: 3 Premier David Alward, State of the Province Address, January 2012 [available at:

4 City of Saint John s Position Paper on Local Governance Reform B) The City of Saint John believes that the current local governance reform package should encourage the development of strong cities in New Brunswick. Urban New Brunswick has played a vital role in the development of the social, economic and cultural landscape of New Brunswick, and it has a key role in the future. Cities in New Brunswick support their neighbouring communities and indeed the continued strength of New Brunswick. In addition, the Province s tax revenue is inextricably tied to a strong and vibrant urban New Brunswick. If the Province decreases the resources available to cities, the impact will be felt across New Brunswick. The City of Saint John is the industrial and commercial hub of New Brunswick, and is proud to house an environment ideal for studying, working, living and investing. Reforms to New Brunswick s local governance system should build on the City s economic contribution and enhance the City s ability to generate economic activity. The City of Saint John believes that urban centres must be active partners in the Province s growth strategy, but not at the expense of towns, villages and local service districts. All local governments play a role in New Brunswick s future, and should be actively involved in its development. The City of Saint John is interested in receiving greater direction and vision from the Province on the role urban municipalities will play in New Brunswick s future. C) We believe the development and implementation of the Province s local governance reforms will benefit from on-going direct local government consultation. The Province s consultation method associated with the proposed reforms has been directed towards umbrella municipal associations to a greater extent than it has been directed towards local governments. More so, the Province can benefit from more fully engaging the public administration of local governments within discussions on an on-going basis. D) We recommend that the Government of New Brunswick clarify all aspects of the intended reform components before implementing individual facets of the reform in an incremental fashion. Local governments must understand all the components of the reform package before the Province expects municipalities to provide meaningful commentary on one particular component. The local governance system is an integrated system, where the numerous facets of the system rely on each other. The Province should be cautious in their implementation of particular pieces of the reform without providing direction on all other matters. An incremental approach to policy development is a concerning one, and as we are all striving to build a modern

5 City of Saint John s Position Paper on Local Governance Reform and sustainable local governance system, the City encourages the Province to reconsider its approach to policy development. PART TWO: FISCAL REFORM A) Local governments are seeking increased provincial transfers truly commensurate with their service responsibility, whether through property assessment, the unconditional grant or any future community funding arrangement. Local governments across New Brunswick, including the City of Saint John, are compromised in their ability to deliver a strong quality of life to citizens because of lack of financial resources and legislative tools. This local governance reform process cannot result in fewer resources for local governments, nor can it result in the creation of additional responsibilities without additional resources, as it is our belief that such actions may have an adverse effect on the quality of life of citizens. The City of Saint John actively participated in research and deliberation associated with the Finn Report, and continues to believe that a transfer of additional tax room in lieu of the unconditional grant is a better long-term approach. B) The distribution of the unconditional grant must account for the services, responsibilities and the fiscal capacity of local governments to deliver such services. The financial capacity of the City of Saint John is constantly challenged because of the geographical size of the municipality, which requires a multitude of residential and industrial services and infrastructure. In addition, the City also houses pockets of extremely dense residential areas with ageing infrastructure, which also has a financial impact on the City s ability to deliver strong and reliable services to citizens. Finally, with a poverty rate near 20 % of the population, it must be recognized that residents ability to pay is not limitless. As indicated in the 2007 report prepared by the Cities of New Brunswick Association, any changes to the provincial/municipal funding arrangement needs to adhere to the principles of fiscal autonomy, stability, predictability, simplicity, accountability, neutrality and especially equity and fairness. 4 More adequate funding from the Government of New Brunswick will allow for more strategic long-term decision-making on behalf of local governments. 4 Cities of New Brunswick Association, The Future of Provincial/Municipal Relations: A Vision for New Brunswick, 2007, page 11.

6 City of Saint John s Position Paper on Local Governance Reform C) In order to maintain the integrity of the property assessment system, we believe property assessment should be uniform, market-based, and at arm s length from all governments. The Government of New Brunswick s intention to permanently freeze property assessment for seniors 5 impacts not only tax revenue for the Province, but will also impact the limited property tax revenue to local governments. It will also introduce distortions in what should be a market-based assessment system. PART THREE: BOUNDARY/SERVICE REFORM A) The voting authority within regional service commissions should represent the proportional size and contribution of local governments. While the City of Saint John represents approximately 60% of the total population and property assessment of regional boundary #9, the City has been allocated one vote in a commission of nine voting members. Commissions should uphold the same values and principles that all government entities strive to maintain, which includes accountability, representation by population and democracy. B) The introduction of regional service commissions should not compromise existing collaboration within the region and it is our hope that the commission builds on existing collaborative capacity. The City of Saint John has played a leadership role in encouraging collaboration and the sharing of infrastructure and services with neighbouring communities. The City of Saint John is motivated to leverage its existing services, resources, and infrastructure as a cost-sharing opportunity for the City and its neighbouring communities in the delivery of services throughout the region. C) The City of Saint John s municipal plan must not only be upheld, but also contribute to regional plans through the regional service commission. The City of Saint John has undergone an award-winning process in developing a strong and focused municipal plan. The outcome is a plan that manages the City s long-term direction, not only for planning, but for numerous components of the City s services, infrastructure, and operations. We believe Plan SJ should play an important role in supporting the future regional plan for the commission. 5 Progressive Conservative Party of New Brunswick, Putting New Brunswick First For a Change, September 2010, page 14.

7 City of Saint John s Position Paper on Local Governance Reform D) Planning across New Brunswick would benefit from simple and concise regulations and policy statements from the Province, which would be actualized by regional commissions and local governments all while setting a sustainable path for New Brunswick. In addition, the Province should strive to align its key service boundaries (Department of Transportation, Department of Environment and Local Government, Economic Development) within the new regional service commissions, in order to maintain consistency and simplicity in government services and programming. PART FOUR: LEGISLATIVE REFORM A) The permissive legislative approach has been well-received by local governments in other provincial jurisdictions, and the Province is encouraged to continue their pursuit of a permissive relationship with local governments. Most provinces (Alberta, British Columbia, Saskatchewan, and Manitoba, among others) have introduced permissive legislation for local governments, and the result has been positive for provincial governments and local governments. The permissive approach is recognized as a means to empower local governments to respond to emerging local issues in a timely and effective manner. The permissive framework also encourages experimentation amongst and between similar local governments to address common issues, which in turn results in a sustainable and progressive approach to local governance. The Government of New Brunswick should not be prevented from modernizing its legislative relationship with local government because of the limited capacity of some local governments. If need be, permissive legislation should be enacted for the use of those local governments that have the capacity to utilize such authority. CONCLUSION The City of Saint John is encouraged by the Province s reforms, and the Province s determination in introducing important and needed changes to New Brunswick s local governments. The City will use this opportunity to expand upon long-standing relationships with its partners, which includes the Government of New Brunswick. The City urges the Province to pursue a comprehensive and integrated approach to reform that will enhance the ability of cities and all local governments to contribute to the wealth and well-being of New Brunswick. While the City of Saint John is energized by the Province s local governance reform package, growing urbanization of the New Brunswick population and economy coupled with infrastructure challenges necessitates a renewed fiscal relationship that strengthens local governments, and subsequently, New

8 City of Saint John s Position Paper on Local Governance Reform Brunswick. This new funding arrangement is needed to deliver the infrastructure and services for economic growth and improved quality of life for citizens. The City of Saint John hopes this position paper contributes to the pan-provincial discussion on local governance reform, and we look forward to continuing the conversation. For more information, please connect with: The City of Saint John P.O. Box 1971 Saint John, New Brunswick E2L 4L1 phil.ouellette@saintjohn.ca Phone:

9 City of Saint John s Position Paper on Local Governance Reform