New Brunswick

Saint John losing hotel levies, bus fares, parking revenue

The city of saint john is trying to gauge the amount of revenue it is losing every month to the COVID-19 crisis. A report presented to councillors Monday says the city could be exposed to as much a $1 million to $1.4 million in losses per month from lost transit fares, hotel room levies, and parking revenue.

As much as $1.4 million per month at risk says city finance commissioner

The Saint John City Market in busier times. Seventy-five per cent of tenants have temporarily closed their doors. (Julia Wright, CBC)

The City of Saint John is trying to gauge the amount of revenue it is losing every month to the COVID-19 crisis.

A report presented to councillors Monday says the city could be exposed to as much a $1 million to $1.4 million in losses per month from lost transit fares, hotel room levies, and parking revenue.

Even the amount of metered water consumed by commercial customers is expected to drop.

The city had budgeted about $14.3 million, or nine per cent of its total revenue for 2020, from such sources.

The severity of the financial hit for the city depends, of course, on how long the COVID-19 crisis lasts.

While the City Market remains open, 75 per cent of the tenants inside have temporarily closed shop.

Rent receipts from the market are expected to drop 88 per cent in April, from $34,000 per month to just $4,000.

On Monday council approved a rent deferral program for market tenants. It will allow them to negotiate interest-free plans to repay the rent deferred now over the second half of 2020. 

A city report says revenue sources currently at risk for the municipality include $120,000 a month in hotel levies, $360,000 a month in transit fares, and $240,000 from parking meters and fines. 

Kevin Fudge, finance commissioner, says some of the projected revenue losses will extend to outlying communities who help pay for now closed regional facilities.

"The Hilton has laid off 85 per cent of the team that serves the Trade and Convention Centre, the Aquatic Centre has laid off most of its staff, Harbour Station is locked down with only essential staff working from home and in the building," said Fudge. 

Saint John Transit plans to resume charging fares to passengers once special glass barriers are installed to protect drivers. (Saint John Transit.)

"This is evidence tonight we're taking a direct hit," said Mayor Don Darling, who has advocated for a four-year freeze on salary increases for the municipality's employees.

In the meantime, steps are being taken to reduce costs across all municipal departments.

John Collin, city manager, has imposed a hiring freeze and given direction that no overtime shall be authorized without his approval.

The municipality's casual workforce has been laid off and — at least for now — the hiring summer students for this year has been put on hold.

Fudge said there is also a spending freeze across all departments, agencies, boards and commissions and asset purchases have been restricted. 

Saint John Transit continues to operate a reduced schedule with just ten passengers allowed on each bus.

Fares have been suspended for the moment, but collection will resume once special glass barriers are installed to distance drivers from passengers.

Fudge warned that should the crisis continue into 2021 there could be longer term impacts on the city in terms of reduced property tax assessments.

ABOUT THE AUTHOR

Connell Smith is a reporter with CBC in Saint John. He can be reached at 632-7726 Connell.smith@cbc.ca

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