Questions & Answers
How can I learn more about the budget challenges and considerations for 2022??
Check out the infographics in the documents library. They provide a quick overview of the current situation and key considerations impacting budget decisions.
Why can't the City run a deficit?
The City is required by provincial legislation to ensure that expenses balance with revenue through the budget process.
How does the City finance capital investments?
The City funds capital works in two ways: capital out of revenue, an annual amount earmarked for smaller projects, and debt servicing cost which is the city’s payment on debt (monies borrowed to contribute to larger scale capital works projects). Council approves a capital budget annually based on immediate need and emerging strategic priorities. Capital projects can range from investments in large-scale studies, new community centres or fire stations, underground sewer work, and information technology upgrades and are usually made possible through cost-shared agreements with the federal and provincial government. The City borrows its share of the cost for the project.
How does the assessed value of my home combined with the mil rate impact my tax bill?
The City of St. John’s calculates the municipal tax for your property based on the property's assessed value and City Council approved mil rate (which happens in Dec. of each year). Water tax is calculated on a per unit basis. For example: A residential property that has been assessed at $225,000 in 2021 is taxed at the current residential mil rate of 7.7. To determine the amount of property tax that is paid on that house, you multiply the assessed value by the mil rate (i.e. $225,000 x .0077 = $1732.50). This is the Realty Tax portion of the total tax payable. To get the full tax bill, we would add water tax of $620 (one water unit) and the total tax payable for this property would then be $2,352.50 for 2021.
What is impacting the expected increases in the City's budget?
Assessed values have declined marginally (4.5% for residential and 2.6 % for commercial) properties and there are some expected increases to the city's budget in debt servicing costs and fleet, primarily. This would result in a $13 million deficit which must be offset by taxes, fees, service reductions, or a combination.