City Council’s Cuts and Spikes a Serious Blow to Local Business & Culture

Looks like the city's budget cuts are targeting exactly what our readers voted as "The Best Things about Living Here."

Our December issue is a “Best of St. John’s” themed one, in which we asked people questions like “Best thing about living here” and the bulk of responses spoke of “downtown culture,” “local business,” and “booming arts scene.” Tourists leave saying the same things. And yet, the new St. John’s budget took its aim at these very things.

The budget was passed by a vote of seven to three, with councillors Art Puddister, Dave Lane, and Sandy Hickman voting against it.

Higher Commercial Property Taxes Will Take a Toll on Business Owners

While we’ll all feel the burn of residential property taxes increasing by an average of 12.7%, local business owners simply mightn’t survive the business realty tax spike of 14.3%.

Here is what Bob Hallett, owner of Tavola Restaurant, had to say about that. “As a business owner and St. John’s downtown resident I am appalled. I have been to numerous meetings this year, and have witnessed over and over again businesses in our city either closing or hanging on by their fingernails.

“Every business owner in this province knows we are in a recession. Belt tightening and cut backs are a fact of life. [The commercial tax hike] is unconscionable and delusional. No business in this city is in a position right now to raise its prices by 20% and have any hope of survival, nor do I know of any enterprise that has that kind of profit upon which it can draw.”

He goes on to say that “Most businesses have already tightened and cut back, and have little room to maneuver. There was no need for this, the mayor and his cabal are leading us off a cliff.”

This is not the “fiscally responsible” decision council is touting it as. In our province, more than 17,000 businesses employ people: 98.5% of them are small businesses with 1-99 employees. 71% of jobs created in the private sector over the past 10 years can be attributed to small business. This is not good for local culture, character, or economy. The smart move is to support and invest in small business. Not harm it.

Arts Funding Slashed by a Devastating 50%

Nationally, Newfoundland, and St. John’s in particular, has a reputation for being an arts mecca of unparalleled proportions. The film scene here is booming more than ever, we have exportably good music in every genre, most of Canada’s favourite authors are from here, we were the only Canadian province with visual artists at this year’s highly esteemed Venice Biennale, etc …

Council is acknowledging this reality by … cutting funding to the arts, tourism, and sports sector in half. and temporarily suspending their $20,000 arts procurement fund.

City Services and Operating Grants to Be Cut

City services to be cut, in hopes private sector companies will assume these roles, include: the summer’s 10-week litter reduction program, the Aquarena’s annual $100,000 operating budget, free bulk garbage days, and the city will no longer do water and sewage repairs on private properties. They’ve also scrapped the automated garbage pilot plan.

It will also cease its contributions to the Grand Concourse Walking Trail, divest itself of the St. John’s Recreation Centre in Buckmaster Circle, and the city will also begin charging for previously free services.

In Better News … Vacant Buildings Will No Longer Be Accommodated

Starting in 2018, the city will terminate its vacancy allowance for commercial property owners, based on community outrage that property owners let properties sit there empty — like the old grocery store carcasses in Churchill Square and Ropewalk Lane. “We’re hearing from communities and neighbourhoods that they want the city to ensure that businesses either clean up, sell, or move on.”

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7 Comments

  • And to think I moved back here from Alberta because of the culture I missed so much. Want to know what happens when there is no downtown, no art, no concerts, no small town feel, and only big name mecca conglomerates on every corner? You get depressed and try to relocate to a place that puts high priority on the very things you missed. Way to go, city of St. John’s. You’re officially useless. *slow clap*

  • The vacancy credit removal does nothing to promote the reduction of vacant properties. It hinders it if anything. Most property owners want their buildings rented. They aren’t making anything on a vacant building.

    Buildings like the old dominion stores are being rented by loblaws. They just don’t want any competing business in there. So the landlords do have a tenant. That tenant (Loblaws) pays rent and just chooses to do nothing.

    Other business owners who are trying to fill vacancies will hurt even more because of this.

    Secondly, it used to be that property tax paid by the landlord. Business tax was paid by the tenant for their business. 2 years ago the city decided to combine the 2 (now called commercial realty tax). This meant the landlord would collect the business tax portion for the city and submit it. This saved the city piles of man hours having to collect from everyone because the landlords did it for them. If a landlord had a vacancy, a credit was issued for the business tax portion only. Property tax was still paid. Fair enough.

    Now 2 years later the city expects landlords to pay the whole amount regardless of an active tenant. ??? It’s much like paying an airport tax for driving your car. Makes no sense and completely goes against why the city combined the 2 taxes in the first place.

    It’s robbery.

  • This is socialism; when the government micromanages business thinking that they have the right to manage a business over the investor who risked his own capital to build the business. Investors invest (create jobs) for three reasons; (1) low taxes (2) lack of government interference (3) a labour pool willing to work. In Newfoundland unfortunately we strike out on all three of those categories and in every instance the issue is promoted by the blatant ignorant with no knowledge of how an economy functions aka. government. There is a saying “a people get the government that they deserve”.

  • what the hell good is addressing the vacant business properties if you make it totally economically unfeasible to run a business in this town let alone start one up? This gutless silver lining they’re boosting at the end of this utterly devastating budget debacle is completely pointless. Two years from today downtown is going to be a goddamn rotted out husk. It’ll be a one two punch of property tax plus no through traffic due to digging up the street for the waterline replacement next year. But I guess it’ll be great opportunity to tear down some heritage buildings and throw up another fucking condo or a hundred fucking outlet stores.

  • This city just keeps getting worse. They are going to force people to relocate, causing the city to make more cuts to sustain itself. We currently have people running this city that arent fit to run their own homes. Im not sure I’ve ever witnessed a more unintelligent group of fools running a city. It amazes me how little people here are doing about this too, a few complaints and thats about it. People should stand up against this kind of garbage, the people running this city have no problems paying their over inflated salaries, i say fire half those idiots since they dont seem to be doing anything useful anyway.

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