FREDERICTON, N.B. – As local governments across New Brunswick plan their budgets for 2027, the Union of Municipalities of New Brunswick (UMNB) is calling for real changes to how municipalities are funded.
By law, local governments must balance their budgets every single year. Right now, property taxes are virtually the only lever municipalities have to pay for essential services such as municipally-owned roads, snow clearing, policing and fire services, and more. With operational costs continuing to rise across the board, local governments will face tough choices to keep communities running.
To ease the financial pressure on local taxpayers, UMNB is pressing the provincial government to move forward with Phase 2 of Property Tax Reform. This next phase would give municipalities more flexible revenue options and a fairer way to share the property tax load among property owners. Crucially, UMNB is calling for true revenue diversification by sharing a point of the Provincial Sales Tax (PST) with local governments.
UMNB acknowledges the $12.5 million increase to the Capital Renewal Fund, bringing the annual total to $55.5 million, but notes that amount is still far short of the $120 million needed each year to fix aging local infrastructure across the province. At the same time, communities with lower than average tax rates are seeing reductions in the Fiscal Capacity Funding they receive from the province, resulting in the need to increase local tax rates to balance their budgets. Also, under New Brunswick’s shared tax system, the province continues to collect roughly 30 percent of all property taxes. UMNB stresses that modernizing this system is essential to keeping local communities affordable and sustainable.
“Every day, local governments deliver the core services that keep our communities running, but our hands are tied when it comes to the budget paying for them,” said Brittany Merrifield, President of UMNB. “Property taxes are effectively the only tool we have to balance our budgets. While an extra $12.5 million for local infrastructure is welcome, the reality is that it barely touches the surface of what’s actually needed to fix our aging roads, water systems, and facilities. It’s time for Phase 2 reforms so local leaders have the flexibility to build strong municipalities, creating a modern financial partnership that gives local governments the tools to grow our economies together.”
UMNB members reiterate their call for the province to allocate 100 percent of federal Payments in Lieu of Taxes (PILT) to local host municipalities, ending the current system where the provincial government retains 99.5 percent of those federal funds.
Contact:
Alyson Samson – Communications Manager
alyson.samson@umnb.ca | 506-478-1695