2 parties would let cities share in tax revenues from heavy industry, 3rd gathers data
Saint John council questions 3 political party leaders ahead of fall N.B. election
New Brunswick political party leaders all had different answers Monday night when asked where they stand on letting Saint John get a share of property tax revenues from heavy industry.
Progressive Conservative Blaine Higgs, Liberal Susan Holt and David Coon of the Green Party appeared before Saint John city council in the lead-up to the provincial election later this fall.
They took questions from councillors on municipal fiscal reform, mental health and housing, among other topics,
In a position paper prepared for the occasion, the city pledged support for reallocating heavy industry property tax revenues to the municipalities in which they are generated to support local services and infrastructure.
Holt said a Liberal government would aim right away for fiscal reform but would aim higher than a transfer of heavy industrial tax revenue.
"That will be a piece of it," she said. "But I think it becomes more powerful when we do a complete property tax overhaul that tackles assessment.
"We need to be getting the right assessment values for our properties and assessing the right things, whether that's machinery and equipment or otherwise."
Holt said it would take more than a "piece of industrial property tax" to give municipalities what they need, and she would hope to have a system in place by the end of 2025.
Green
Party Leader David Coon says his party favours sending a 'significant
proportion' of industrial property tax revenue to the city but would
hold some back because of environment-related regulation. (Nipun Tiwari/CBC)
The Higgs government brought in local governance reforms in early 2023, creating or expanding multiple municipalities. The changes followed a white paper in late 2021 that said these reforms would be followed by fiscal reform.
The intent was to make changes related to finances before Jan. 1, 2025.
In Saint John on Monday, Higgs turned questions about municipal reform over to Local Government Minister Glen Savoie, who did not make a commitment but told councillors the province hopes to have finished gathering data by next year.
He said he's heard Mayor Donna Reardon talk about a "deficit" of $300 million in needed infrastructure and said he wants to "understand that right across the province."
John
Mackenzie, the Saint John deputy mayor, pressed all three leaders on
whether they would expand existing mental health and addiction services. (Nipun Tiwari/CBC)
Once the infrastructure picture is better understood, his party can address reform.
"Do we need to look at industrial taxes being flowed to the municipality from where they come? Those are all questions that will be answered through that process."
Any legislative changes related to fiscal reform would happen in 2025 for implementation in 2026, Savoie said.
Coon said the Green Party would ensure that a significant proportion of industrial property tax revenue goes to the city — "but not entirely."
Progressive
Conservative Leader Blaine Higgs suggested his opposition to safe
injection sites has to do with the safety of people in the community. (Nipun Tiwari/CBC)
"There's a strong linkage in the case you made in your paper about the city hosting a lot of heavy industry and therefore you should be seeing significant benefits … through the property tax system, which you are not. So you should.
"There is one small issue of environmental regulation which the province is responsible for. So we need to hold on to a little bit of [tax revenue]."
Responding to mental health, addiction
Priorities raised in the city's new affordable housing strategy, including addressing addiction, mental health and homeless, were also raised by councillors.
Deputy Mayor John Mackenzie asked the party leaders whether they would expand existing services of mental health and addiction help, such as those offered by Ridgewood Addiction Service, a rehab centre in Saint John.
Higgs said additional mental health and addiction centres are required and his government is looking into expanding existing services, such Portage Atlantic, a residential drug rehab centre.
Coun. Paula Radwan questioned how Higgs would address people who were "not ready to stop using hard drugs."
Earlier Monday, Higgs told a Saint John business group that he would not approve safe injection sites. A goal of these supervised sites it to prevent overdoses, but Higgs told Radwan there are concerns about the safety of other people.
"We have to find a way to say 'When does it become a safety issue?'" Higgs said.
"We have to make the hard choices and find a way to balance that so that we don't have a situation where someone really gets hurt from someone who is heavily addicted."
Coon said existing mental health services need to be expanded, but he also cited barriers to existing mental health services, with many providers being private. He said infrastructure exists but some people can't get access to it.
"Most people can't access those who really need it, and so we need to make sure they can," he said.
Holt agreed there are some existing solutions, such as Ridgewod, but said more can be done.
At the outset of the session with party leaders, Councillors David Hickey and Joanna Killen declared conflicts of interest and left the council table because they're both candidates in the October election. Coun. Brent Harris declared a conflict of interest because he's managing a candidate's campaign.
NDP Leader Alex White will be able to appear at council next week, Reardon said.
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What was it that Higgy said about data?
"Higgs devoted much of the speech to touting economic data, such as strong growth in weekly earnings, the fastest population growth since Confederation and the first reduction in the province's median age since 1961. The province's population is now estimated to have surpassed 824,000, Higgs said.
"I could go on about the momentum we're building together in our economy," he said, adding, "You all know I like data by now."
That was a joking reference to his now-infamous "Data, my ass" comment to education officials, which Dominic Cardy revealed when he quit as education minister in October."
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Saint John pushing for municipal energy utility to become city-owned corporation
Legislation around Saint John Energy was created more than 100 years ago and needs an update, says CEO
Saint John Energy CEO Ryan Mitchell says "corporatizing" the municipality's energy provider could have significant benefits for the city by driving economic growth and stabilizing energy rates.
This would turn the utility into a corporation owned by the city — a change which would open doors for the company, Mitchell said, but current legislation stands in the way.
"The legislation around Saint John Energy was created in 1922," he said.
"So if you think about all of what has changed over the last 100 years, we really operate in a completely different world today. A world with ever-expanding energy needs, where innovation and agility is required to move to a cleaner energy future, where energy efficiency and affordability are critically important."
With a provincial election on the horizon, the City of Saint John and Saint John Energy are pushing for the party that forms the next government to support their goal of allowing the utility to act as a corporation.
Currently, the province's Local Governance Act doesn't allow municipalities to establish corporations or hold shares in corporations. Mitchell says this causes limitations on how the provider is able to operate.
The province's Electricity Act also stops the utility from selling outside of city limits.
Constraints = lost opportunities, CEO says
Mitchell said that while New Brunswick legislation allows for other provincial utilities to sell their services to Saint John Energy, the municipal utility can't easily do work elsewhere, and these legislative constraints mean losing out on opportunities that could spur innovation, create jobs and potentially help keep rates from rising.
"We want to be able to pursue opportunities like these. Existing legislation today either makes it very difficult to accomplish or just doesn't allow for it," he said.
"We can use that revenue to offset and to take pressure off of rates for our customers. We can also use that to share in the benefits with the City of Saint John through a dividend."
Coun.
Gary Sullivan, who sits on the Saint John Energy commission, says a
move towards corporatization could stabilize rates, with an added buffer
of revenue coming from diversified interests. (Nipun Tiwari/CBC)
Coun. Gary Sullivan, who sits on the Saint John Energy commission, said the move would benefit the city in a number of ways, including bringing stability to rate payers through the energy provider having "diversified interests."
"If Saint John Energy has some other revenue coming in from other sources, if something happens drastically with rates, it could be a buffer on that side," he said.
Sullivan also said the move toward corporatization would allow Saint John Energy to thrive and be leaders and also progress goals on fossil fuel reduction.
"But we don't want to hold them up with extra paperwork and red tape and conversations that would have to happen. We want them to be enabled to do that," he said.
But the push needs provincial support.
City looks for alignment from provincial parties
Provincial party leaders presented their platforms to Saint John council at a special Monday night meeting. Corporatizing the utility is one of six items on the city's list of priorities that they are asking for provincial alignment on.
Both Green and Liberal Party leaders Susan Holt and David Coon voiced their support.
Local Government Minister, Glen Savoie, who took questions for Progressive Conservative Leader Blaine Higgs on the subject, said that corporatization is a part of the current government's plans for fiscal reform, which it is still gathering data on.
Any legislative changes related to fiscal reform would happen in 2025 for implementation in 2026, Savoie said.
Sullivan said that all of the major parties seeing value in the proposal is a good sign and is optimistic about the future for the city's goals for its energy utility.
"Guaranteed, immediately following the election when we see who is in power and controlling the legislative agenda, that conversation will continue," Sullivan said.
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???
William Peters
But, what hasn't changed in the last 100 years? It seams like a justification that could be used for anything. It would appear SJ wants energy independence if it could have it. That's not quite in the interests of the central utility.
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That is sure to be beginning of the end.
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Proposed N.B. Power rate increase hits wall of opposition during final arguments
Poverty groups, industry, municipal utilities and public intervener all express concern
Multiple parties participating in N.B. Power's summer-long rate hearing joined forces during final arguments Monday to urge the New Brunswick Energy and Utilities Board to reject the Crown corporation's full request for an average 9.25 per cent increase in electricity prices in each of two straight years.
"A financially healthy N.B. Power is good for all in New Brunswick," said Ryan Burgoyne, a lawyer representing the three municipal utilities that operate in Edmundston, Perth-Andover and Saint John.
"However, the burden of improving N.B. Power's financial health cannot fall exclusively to ratepayers."
The three civic utilities were joined by New Brunswick's public intervener Alain Chiasson, forestry company J.D. Irving Ltd. (JDI) and a pair of groups representing low-income power customers in criticizing the size of rate increases being requested.
They all called on the EUB to exercise its powers to make adjustments.
Saint
John Energy was among a number of groups including other New Brunswick
municipal utilities, J.D. Irving Ltd, anti-poverty organizations and the
public intervener in opposing N.B. Power's plan for cumulative rate
increases over two years of up to 20 per cent. (Robert Jones/CBC News)
"The threat to New Brunswick's economy and to some New Brunswick residents and businesses is existential," argued lawyer Glenn Zacher in JDI's final presentation asking the EUB not to approve the full increase.
Since June, N.B. Power has been in front of its regulator seeking approval of an average 19.4 per cent cumulative rate increase over two years, including 9.25 per cent this year and another 9.25 per cent beginning next April.
Proposed increases to residential and large industrial customers are even higher, totalling 20.6 per cent over the two years.
The first half of those amounts took effect in April but are subject to final approval by the board following the current hearing. If the full amount is not approved, N.B. Power will be required to rebate excess amounts customers have already paid.
Energy
and Utilities Board member Christopher Stewart is presiding over a
three-person panel that has been evaluating N.B. Power's rate request. A
final decision on the application is expected this fall. (Ian Bonnell / CBC)
As of the end of August, N.B. Power estimates it will have collected $52.5 million in higher rates since the spring.
The utility has been arguing the amounts are needed to help overcome ongoing performance problems at the Point Lepreau nuclear generating station, improve its weak financial condition and prepare for expensive capital projects that are looming, including a multi-billion-dollar refurbishment of the Mactaquac dam.
In his presentation, Burgoyne acknowledged N.B. Power is not financially healthy but said raising rates significantly needs to be a last resort in fixing its problems.
"N.B. Power must minimize costs and take all other reasonable steps to improve its financial health without excessively burdening ratepayers," Burgoyne said in his presentation.
He said the municipal utilities "do not believe that the evidence in this matter supports that N.B. Power has taken these steps."
The
Point Lepreau Nuclear Generating Station has been idle since early
April. A problem with its generator is expected to keep it offline until
November. It has been adding to N.B. Power's financial troubles at an
estimated cost of $900,000 per day. (Marc Godbout/Radio-Canada)
Zacher made a similar argument on behalf of JDI, which is N.B. Power's largest private sector customer.
He claimed the utility has been the author of many of its own misfortunes, like poor performance at the Point Lepreau nuclear station, and said it should not be up to N.B. Power customers to come to the rescue.
"It is not just and reasonable that New Brunswick ratepayers continue to bear costs that do not reflect reasonable management and operation of the utility," he argued.
Public intervener Alain Chiasson questioned a number of accounting issues at the utility and what he claimed were unneeded or exaggerated expenditures planned by N.B. Power in the two-year period and said he felt there was considerable room available to the EUB to lower the request.
"The public intervener opposes the applied-for rate increases in 2024/25 and 2025/26," Chiasson argued at the beginning of his presentation.
Shelley
Petit is chair of the New Brunswick Coalition of Persons with
Disabilities. Petit was among several participants in N.B. Power's rate
hearing to ask the EUB to use its powers to soften the size of
requested increases. (Nipun Tiwari/ CBC News)
Representatives of the Saint John Human Development Council and the New Brunswick Coalition of Persons with Disabilities also weighed in, calling the proposed rate increases a serious problem for low-income customers.
Both groups have been questioning the absence of special low-income energy assistance programs available in other jurisdictions, like rate rebates, and urged the EUB to find some way to help.
"I urge the board to carefully weigh the human cost of the proposed rate increases," said the coalition's Shelley Petit.
"It is imperative to consider alternative solutions that do not place an undue burden on our most vulnerable citizens."
In its final presentation that lasted more than 90 minutes, N.B. Power lawyer John Furey argued that the utility's financial problems are well understood and said during the hearing it fully and exhaustively justified its need for the full amount it is requesting.
"N.B. Power acknowledges that historically rate increases have not been as large as requested in this proceeding," said Furey. "But N.B. Power faces a challenging business environment."
A final decision on the rate increase by the Energy and Utilities Board is expected to take several weeks.
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No doubt the decision appear after the election
Methinks somebody has been checking my work N'esy Pas?
N.B. Power critic sees more reasonable approach in latest rate hike request
Robert Knecht says he still sees overly optimistic projects in utility's long-term financial forecast
A utility expert who's been critical of N.B. Power's financial forecasts says the Crown corporation appears to have adopted a more balanced approach with its latest rate request.
Robert Knecht testified Tuesday afternoon during an Energy and Utilities Board hearing in Fredericton.
The board is weighing N.B. Power's request to increase power rates by an average of 9.25 per cent this year and again next year. Its filings with the board show 4.75 per cent increases in each of the following three years.
Knecht, who lives in the United States and has previously testified before the board, was hired by the public intervener to analyze N.B. Power's proposed rate increase.
"By setting a lower increase in the [later] years, it gives itself a little more flexibility," Knecht said in response to questions from N.B. Power lawyer John Furey.
"That could be called more responsible, it could be called more conservative."
N.B. Power faces a 2029 target set by the provincial government to reduce its debt. (Shane Fowler/CBC)
Knecht said "it's no secret" he's long been critical of N.B. Power's projections as it faces a $5.4-billion debt and major spending on existing power plants.
Knecht said the proposed rates appear to balance the concerns of current ratepayers with those in the future.
Furey asked if lower rates in earlier years makes it less likely the utility can meet a 2029 debt reduction target set by the provincial government. The target calls for 80 per cent debt and 20 per cent equity in its capital structure.
"All other things being equal, reducing the rates in the early years makes achievement of the equity target even more difficult," Knecht told Furey.
His report filed with the board ahead of the hearing notes the utility has major capital spending looming, including meeting a commitment to achieve net-zero carbon emissions by 2025.
It's a target that would affect the utility's Belledune coal-fired power plant, its Coleson Cove heavy-oil plant, and Bayside natural gas plant.
Furey pointed out there is also a looming decision on the future of the Mactaquac Dam.
At the same time, Knecht's report points out N.B. Power needs to deal with demand from a growing population and perform upgrades on its transmission system.
Knecht noted the utility appears to be better at reflecting the actual performance of the Point Lepreau nuclear generating station, using historic performance data to forecast into the future.
But Knecht said he still sees problems in the utility's financial forecasts submitted as part of the rate hearing.
"While it is risky to generalize, my overall assessment of the current five-year financial forecast is that it has substantially reduced much of the undue optimism for the near term, but the longer-term outlook contains assumptions that appear to retain the historical rosiness," his written report, filed with the board, states.
Knecht's report lays out the earnings forecast in a graph, showing the uptick in future years that he describes as a hockey stick.
"The hockey stick is still there and it just keeps moving out," Knecht testified.
The board's hearing on the proposed rates is expected to continue this week.
The board previously approved an interim rate increase this year pending the outcome of the hearing.
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Cottager blames N.B. Power for half-sunken boat in Mactaquac headpond
N.B. Power defends giving only 3-hours’ notice before lowering water at dam
It's been everything but a relaxing summer for Andrew O'Hara at his cottage, near Scotch Settlement, on the Mactaquac headpond,
It's just upstream from the Mactaquac Dam, which occasionally releases water downstream on the St. John River.
But O'Hara said the dam's operator, N.B. Power, gave little notice on Aug. 11 when it released water, lowering water levels in front of his cottage by a metre, or about four feet, beaching his boat moored at his dock.
O'Hara said N.B. Power sent out emails and posted on Facebook on that date, warning water levels would be lowered within three hours or less.
Despite what he calls "very short notice," O'Hara said he rushed to his cottage from Fredericton only to find the boat already high and dry.
"We couldn't believe the amount, the drastic amount of water that had been dropped," he said.
O'Hara
found his boat already beached on Aug. 11 when he got to his cottage,
after hearing N.B. Power would lower water levels within three hours. (Submitted by Andrew O'Hara)
Then, the following week, a call came from a neighbour: O'Hara's boat had sunk.
The airtight seal on the motor mount had broken when the boat was at an awkward angle from being beached, which then let in water as the levels rose.
"I'm not the one that sunk that boat. N.B. Power did and they know it," O'Hara said.
"So they should be taking care of getting rid of it."
The company would not speak directly about O'Hara's case but denies wrongdoing for damage caused by fluctuating water levels, for which it said it gave adequate warning.
O'Hara said a representative didn't come to view the boat until Aug. 30 and placed floating booms around it to prevent gas leakage. But O'Hara said he soon got a call from an N.B. Power employee, who said the company would not pay to have the boat removed from the water, for repairs or a new boat.
"It's clear disregard for people within the area, land owners and boat owners," O'Hara said.
High cost to remove
The boat has now been half-sunken for a month, its rear end and motor submerged.
O'Hara said he was quoted $1,700 to remove the boat and estimates it would cost about $15,000 to replace. While insurance will cover some costs, he said he will likely still be on the hook for several thousand dollars.
He calls N.B. Power's actions irresponsible and completely preventable.
"I just want them to replace my boat. That's all I'm looking for and to take care of removing this one."
An
N.B. Power official placed floating booms around the boat on Aug. 30 to
prevent gas from leaking, O'Hara says, but did not remove the boat. (Michael Heenan/CBC)
He's been a boater in the area for 15 years and said he is familiar with water levels changing now and then, but what he saw in August at his cottage was extreme.
This isn't the first time N.B. Power has faced criticism for how quickly it reduces the water levels on the Mactaquac headpond, about 25 kilometres west of Fredericton.
Residents also complained in summer 2021, leading to N.B. Power giving more advance warning to residents.
But O'Hara said there was not enough notice for him.
N.B. Power defends notice given to residents
CBC News tried to find out more about dam operations, the need to lower water levels on three hours' notice and the situation with O'Hara's boat, but spokesperson Dominique Couture said no one from the company would be made available for an interview.
She sent an email statement instead, which said water levels were lowered to 130 feet (39.6 metres) on Aug. 11, in preparation for Tropical Storm Debby. The headpond usually ranges between 128 and 133 feet (39-40.5 metres)..
Couture's statement did not speak directly to O'Hara's case, but said the company "is not responsible for individual property damage resulting from normal fluctuations in water levels within the usual operational range."
The Mactaquac Dam holds back water in the Mactaquac headpond, about 25 kilometres west of Fredericton. (Michael Heenan/CBC)
"We understand the importance of timely communication when water levels change, and we are committed to continuously improving how we notify the public," Couture said.
"It is also important to note that water levels within the normal operational range can affect boats and docks differently, depending on the specific conditions and topography of the Headpond."
The day after levels were lowered, N.B Power posted on its Facebook page that it was dealing with "issues with the water level data" on its website.
When asked if these data issues were related to why the company only gave residents a three-hour notice of water lowering, Couture said no, it was only the public page that was affected by issues, the company still had access to water data.
O'Hara said he is considering legal action, but had hoped N.B. Power would have settled up.
Ultimately, he said he's disappointed about the missed time fishing and using the boat with his family.
"This is kind of our getaway, our sanctuary to have a little bit of relaxation, a lot of bonding time with my sons out fishing. That all got cut short," he said.
"You know, you work hard to have a little bit of enjoyment in life."
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