Strong financials in Spaniard's Bay

Terry Roberts
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Mill rate roll back means minimal tax increases for residents

Tony Menchions is deputy mayor of the Town of Spaniard's Bay.

A healthy financial situation in the Town of Spaniard's Bay means property owners will see only a marginal increases in taxes this year.

The town council adopted its 2013 municipal operating budget on Dec. 20, highlighted by a two-point reduction in the residential mill rate, from nine to seven.

The reduction means property owners will pay, on average, about four per cent more in 2013. That's well below the percentage increase for some other towns in the region, where some homeowners will see increases of 20-plus per cent and more.

Like most municipalities in the province, the assessed value of properties in Spaniard's Bay have spiked sharply, by an average of 34 per cent.

This means a home previously assessed at $200,000 may now be valued at $268,000. With the mill rate at nine, the property tax for that property would have gone from $1,800 to $2,412, and increase of $612 annually.

By lowering the mill rate to seven, the property tax for that property will be $1,876, just slightly above the amount charged in 2012.

But those who pay the minimum property tax - currently $400 - will now see an increase of $50, and unserviced land located close to water and sewer infrastructure will now pay this tax.

In all, the town expects to collect an additional $73,000 in property taxes in 2013.

Fees to connect to the water and sewer system will also increase from $1,500 to $2,000, which council members say is more in keeping with the actual costs.

And the cost for a commercial permit will go from $7.50 per $1,000 to $9, which is "in keeping with similar business districts on the Avalon," said Deputy Mayor Tony Menchions, who also chairs the finance committee.

He said the budget is a reflection of the solid financial situation the town is enjoying, and an unusually low debt servicing ratio of just 11.17 per cent of revenues, well below the allowable rate of 30 per cent.

About a decade ago, the debt rate was above 40 per cent.

But council members say there is another message in this low debt rate. They say it is symbolic of a provincial government that has consistently denied the town's applications for cost-shared funding for capital works projects, while other towns in the region benefit from such arrangements.

Council members say community roads and other infrastructure are in serious need of improvements, and application will be made for more projects in 2013, including paving work on New Harbour Road and Ridge Road.

Increasing expenses

The town is projecting to take in just under $2 million in revenues in 2013, up from the $1.85 million in 2012.

This increase is needed in order to keep pace with the increasing costs of running the growing town, said Menchions.

Nearly every category on the expense side of the ledger is increasing, including general administration, vehicle operations and repair, snow removal, garbage collection and water and sewer.

The town is also budgeting for the creation of a new position. A compliance and regulations officer is expected to be hired sometime in the new year, said Menchions.

Some of the extra revenues will be used to help modernize the equipment used by the volunteer fire department, with an additional $10,600 budgetted. The extra funding will be maintained for several years, as needed, said Mayor John Drover.

The town wants to replace the 1985 pickup now used as a rescue unit by the fire department, and is hoping for a cost-sharing arrangement with the province. One member of council said there is a "good chance" that will happen this year.

Meanwhile, town officials remain upbeat about the proposed Veterans Business Park in Tilton, and expects construction to begin in 2013.

The town is expecting to take in more than $21,000 in permit fees from the site this year, and is expected to begin a major water and sewer project to bring services to the site.

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Recent comments

  • Concerned
    January 04, 2013 - 16:01

    Great Job from the Town Officials and Volunteers. It takes a lot of work and is appreciated by many if not all. Thanks! Just a little concern: Be careful of the Industrial Park process and that we do not spend millions to put in water and sewer if this is just a pipe dream and can not be put together financially. Let the land go back to the government.