Saint John Mayor Donna Reardon acknowledges homes and apartments in her city will be hit with disproportionately high tax increases for a second year in a row when bills arrive early next month, but says that is only because provincial property tax rules are forcing that outcome on city taxpayers.

"You're handcuffed," said Reardon. "The percentage increase is not across the board. That to me doesn't make sense."

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Clik here to view.                                         The Brunswick House office tower in Saint John will pay the city $11,662 less in municipal property tax in 2025 than it did in 2024. It received a 0 per cent assessment increase and will benefit from a tax rate reduction the city passed to help homeowners. It's one of nine major office buildings in the city getting a 2025 tax cut. (Robert Jones/CBC)

The issue for Saint John is caused by property values that have been growing much faster on housing than on business and government properties, according to annual property assessments conducted by Service New Brunswick.  

However, despite that uneven growth pattern, the city is prevented from directing property tax rate reductions toward housing properties by a provincial rule, which forces it to share any property tax rate cuts it adopts among all property owners equally.

It's that rule that Reardon blames for the one-sided escalation in taxes being experienced by homeowners and landlords and is something she is hoping the province will change by next year.

"We all need to be raised up by the same amount, whatever that is," Reardon said about her belief property tax increases should be shared equally among all groups in a community.

"If it is, on average, 10 per cent on residential, then it should be, on average, 10 per cent across the board."

That is not how the current system has been working.

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Clik here to view. N.B. Power's Coleson Cove generating station is one of several industrial properties in Saint John that will pay less in property tax in 2025 than it did in 2023 because of a provincial tax rule that forced the city to provide them with tax rate reductions. (Roger Cosman/CBC)

Over the last two years, Saint John has cut its property tax rate by 4.3 per cent to offset some of the effects of rising property assessments.  

The amount has been only a minor benefit to homeowners who, along with landlords, have experienced a 22.9 per cent increase in their taxable assessments over that period.

But for owners of industrial properties in the city, which have been assigned combined assessment increases of 2.8 per cent by Service New Brunswick over two years, the 4.3 per cent municipal property tax rate cut has meant significant savings.

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Clik here to view. The Saint John Regional Hospital is the single largest source of property tax in Saint John, but its assessment growth has been slow. In 2025 the facility will pay the city $163,698 less in tax this year than it did in 2021. (CBC News file photo)

Several heavy industrial properties in Saint John will pay less municipal property tax in 2025 than they did in 2023 because of weak assessment growth and their mandatory share of the municipal property tax rate cut.   

Among those paying less tax than two years ago will be J.D. Irving Ltd's east-side wallboard plant and paper mill and its west-side tissue mill. 

Also paying less will be Irving Oil's refinery and Canaport crude oil terminal, the Moosehead Brewery, Repsol's LNG facility, and N.B. Power generating stations at Coleson Cove and Bayside.

As a group, all of Saint John's heavy industrial properties are to be billed $231,088 less in municipal tax in 2025 than they were in 2023.  

It's a revenue reduction to the city that owners of residential properties are having to replace.

A second major beneficiary of the provincial rule that property tax rate cuts be shared equally is the province itself.   

In Saint John, the New Brunswick government owns or directly funds organizations that own more than $730 million-worth of taxable property. That includes nearly three dozen schools, a pair of hospitals and other educational and health-care facilities.

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Clik here to view. Retired Saint John resident Terry Nadeau is expecting a $312 increase in his property tax bill when it arrives in early March. The 7.9 per cent jump that he and thousands of other homeowners in the city are getting in 2025 will partially be used to pay for increasing municipal costs and partially used to replace tax revenues from commercial, industrial and government properties that are growing marginally or not at all. (Submitted by Terry Nadeau)

The assessment on those properties has increased six per cent in two years but with the city's 4.3 per cent tax rate reduction applying to those properties as well, tax revenues to the city from them have grown only slightly.

Reardon said if the city had been allowed to adjust tax rates for each property group independently, it "absolutely" would have made changes to ensure each paid a more equal share of increases.

In November, Premier Susan Holt said a campaign promise Liberals made last fall to overhaul the property tax system, including a rewriting of rules that apply to municipalities, will be kept — but not until the 2026 tax year.

"The timeline is key," Holt told CBC News.

"We're going to get the work done within the first year so that the bill you get, come this time next year, will have a new system under it."

The government has not said what reforms are being looked at, but during last year's provincial election campaign, Liberals promised one of the key outcomes of reform would be that "everyone is paying their fair share."