New Brunswick

Despite pandemic costs, at least 19 municipalities didn't apply for COVID relief money

So far, 19 municipalities in New Brunswick have decided not to apply for aid after realizing the decisions they had to make to balance their budgets would make them ineligible under the province's rules. Another 38 are unaccounted for, and Friday is the deadline.

66 communities asked for federal aid, the province denied one town's claim, and 38 communities unaccounted for

Sackville hoped for $290,000 from the federal rescue package for municipalities but the province denied the claim. (Shane Magee/CBC)

Municipalities lost revenue in the first year of the pandemic and faced COVID-related costs for such things as masks and plexiglass, but if they hired fewer summer students, cancelled events or found ways to cut costs, many of them couldn't get federal aid from the province.

With the deadline Friday, so far 19 municipalities have decided not to apply for aid after realizing the decisions they had to make to balance their budgets would make them ineligible under the province's rules.

Ottawa allotted New Brunswick $41.1 million for local governments as its share of a $2 billion national rescue package announced in July 2020.

Of the 104 municipalities in the province, 66 applied for some help, and all but one received it. This leaves 38 communities unaccounted for. They'll either submit an application at the last minute or not apply.

Saint John topped the list with $3.37 million in relief, Moncton is set to receive $2.56 million, and Fredericton $1.12 million. 

The Village of Gagetown, at the bottom of the list, received $460.

Sackville's entire claim of $290,000 was denied. 

Jamie Burke, Sackville's chief administrative officer said, the town was frustrated by 'the lack of clarity' in the rules for qualifying for assistance. (Submitted by Jamie Burke)

"We were a bit frustrated with the lack of clarity around, you know, eligible and ineligible expenses," said Jamie Burke, Sackville's chief administrative officer.

He said two town employees spent days poring over the budget, looking at COVID expenses and costs to submit to the province.

"It was a considerable amount of work, you know, a considerable work that was there was unsuccessful," said Burke.

Like many municipalities, Sackville saved money cancelling events and programs and hiring fewer summer students.

Burke said the town submitted costs for such things as masks, sanitizer, plexiglass and setting up a welcome centre for Mount Allison University students in the fall to make sure they had the resources and information to isolate properly if necessary.

"Which we felt was really important for the community safety perspective," said Burke.

Those expenses were acceptable to the province, but other costs, such as lost productivity and a summer concert on Silver Lake were not.

So far, 19 municipalities have chosen not to apply

Riverview was among the municipalities that didn't go after the federal money.

CAO Colin Smith said that looking at the provincial guidelines, the town knew it wouldn't get any.

"We're not going to run a deficit for the year and we manage our expenses, so we didn't feel we were in a position to go and submit based on the criteria that the province had put forward," he said.

Smith said the town did have a number of expenses, but the greater loss was in programs and events.

"While it wasn't a financial loss, it was a loss in services that people didn't see in the community."

Challenges different for small centres

The City of Moncton asked for $2.9 million and received $2.5 million.

Isabelle LeBlanc, director of corporate communications, wrote that one item claimed by the city was denied, but overall she said, the process wasn't too complicated.

"We have been tracking the impacts of COVID throughout the year, and we had a lot of the information required already at our disposal," said LeBlanc.

But as Margot Cragg, executive director of the Union of the Municipalities of New Brunswick said, smaller centres have fewer staff and, "more work gets piled onto onto a smaller and smaller group of administrators."

This made compiling the information more difficult for some smaller municipalities.

Cragg said it's also important to point out that, "municipalities, as a level of government aren't allowed, by legislation, to run operational deficits."

Colin Smith, chief administrative officer for the Town of Riverview, said the town did have a number of expenses, but the greater loss was in programs and events. (Town of Riverview)

When COVID looked as it was going to cost money, local governments had to act fast because they can't go into the red. 

"Think of things that look like savings but really represent services that were cut, people that unfortunately didn't have jobs," said Margot.

She said some municipalities could have made different choices if they'd known how much of the federal money they  were getting.

But Cragg does credit the province with giving security to the municipalities in their biggest budget item: property taxes.

"In New Brunswick, the province guaranteed municipalities property taxes and that's a big deal," she said.

Across Canada, some local governments have to collect property taxes themselves. If citizens are struggling to pay them, the village, town or city goes without. In New Brunswick, the province does this.

Margot Cragg, the executive director of the Union of the Municipalities of New Brunswick, said legislation dictates that local governments aren't allowed to run a deficit, so municipalities had to pivot quickly to cut services when revenues tanked and COVID costs rose. (Tori Weldon/CBC)

"They weren't in the situation of literally having to scramble to keep the lights on, this was the situation of other provinces around the country." 

Another difference is that most provinces paid the federal money out shortly after it was received on a per-capita basis, but New Brunswick went a slower route.

Daniel Allain, the minister of local government, said the process was set up to make sure those who needed the most received the most.

He said places like Sackville didn't get money because they showed a surplus rather than a deficit.

"It was really easy to follow or we weren't overbearing, it wasn't complicated, it was very simple," said Allain. 

After going over all the applications, a little less than $30 million is left over. Allain said it will be dispersed to all 104 municipalities on a per-capita basis in the next few weeks.

Corrections

  • An earlier version of this story said 38 municipalities did not apply to the province for federal aid. In fact, 19 decided not to apply. The plans of another 38 communities were not known and they still had time to apply on Friday, the deadline.
    Jan 15, 2021 11:50 AM AT

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