Industrial property upgrades unlikely to boost city taxes
While some councillors have questioned why a multimillion-dollar investment in the Irving Oil refinery generated only a small increase in tax revenues for the city of Saint John, Fredericton litigator Matthew Pearn tells CBC News that the law treats industrial properties differently than their commercial and residential counterparts.
As the article notes, Irving Oil invested $200 million in "substantial upgrades" at the refinery last fall. However, recent tax bills issued by the province show that assessors increased the refinery's property value from $97.9 million last year to $98.6 million this year, raising its tax bill by $33,000 — a fraction of the amount some expected.
However, Pearn, a lawyer with Foster & Company, explains in the article that New Brunswick's Assessment Act treats industrial properties much differently than commercial and residential properties. As a result, he says, when a company spends millions on improvements it often does not translate into a property assessment increase.
"Our legislators have made compromises in the way that we tax certain kinds of businesses," he says.
"At some point there was a decision made on a trade off. You decide that the jobs that are there are worth more than the taxes you might collect as a municipality,” he adds.