Pandemic pushes Moncton toward multi-million deficit, staff aim to avoid tax hike


Moncton's city manager says municipal staff feel "very strongly" that they should avoid a tax rate increase as a result of the pandemic.

Marc Landry said city staff will spend the coming weeks combing through the 2020 budget looking at what can be cut or deferred from the city's $161.8 operations and $47.3 million capital budget. Those proposals will then go to city council for approval.

"We're going to do everything in our power to make sure we go through all the items in the budget and come as close as possible to a balanced budget," Landry said.

That will likely mean shaving millions in spending, according to two financial projections outlined at a city council meeting held by video conference Monday. 

Under the first scenario with measures to control the pandemic lifted by June 1, the city forecasts a deficit of $1.7 million. If the measures remain until Sept. 1, that deficit climbs to $3.5 million.

Coun. Brian Hicks said the last thing residents or businesses need is a tax increase. He suggested millions put into reserve accounts from a surplus last year and higher than budgeted assessment growth could be tapped. 

"We do have a bit of cushioning through reserves and good budgeting," Coun. Blair Lawrence said. 

A one cent change in the tax rate generates about $800,000, Landry said. 

The projections estimate short-term losses related to revenue from the Magnetic Hill Zoo, trade shows at the Coliseum and bus fare, but savings from things like cheaper fuel.

Longer-term losses are anticipated to assessment growth, which reflects the pace of new construction, industrial park land sales, and changes to the value of the city's pension plan because of the stock market. 

Asked by reporters about budget items the city could look at cutting, Landry declined to elaborate. 

He said reducing spending on things like repairing potholes wouldn't make sense because the cost would likely be higher to repair the street in the long-term.

Landry said the city has already laid off 15 casual staff at parks, the Coliseum and rinks. He said the city would need to be at a "full complement" of staff before considering taking on summer students.

The city continues to issue development and building permits, but Landry said it's not clear yet how the booming construction market in the region could be affected over the coming years.