Property tax rates cloud Lincoln plebiscite debate

Businesses and citizens in Lincoln are worried a vote to turn the local service district just outside of Fredericton into a village could cause taxes to increase.

Lincoln is just the latest unincorporated area to consider changing how it is governed. On May 13, about 3,000 residents will vote on whether to become a village, which would give it a mayor and council and more power to make local decisions.

But Jeannette Scott, of Scotts Nursery, said shes worried her business taxes will jump to $2.89 per $100 of assessed property value from $2.50.

"This will be quite detrimental to businesses. This is going to increase our costs and obviously those costs will have to be put somewhere," she said.

But its not only business owners who are worried about increased taxes if the unincorporated area votes to become a village.

Brian Whittaker said he will be voting against the idea of Lincoln becoming a village.

While property taxes will drop in the first few years, he said those rates will climb back upif more services are demanded.

"We are just saying, Don't gloss it over and make it seem like the taxes, you know, are going to stay down and you are going to get more services," he said.

The Alward government wants to reduce the number of local service districts and other government bodies that come under their control.

Local Government Minister Bruce Fitch announced a plan in 2011 that would encourage municipalities to consider amalgamating. The plan includes incentives to entice rural areas to co-operate or merge with other towns and villages

James Arbeau, the chairperson for the local service district, said he supports becoming a village and isn't worried about his taxes going up.

"If right now, as we have been told, status quo we dont want any changes in our services and if that remains the case then the tax rate is only going to be inflationary," he said.

A feasibility report on the provincial governments website said an owner-occupied house, assessed at $200,000, would see its property tax bill decrease by $551 in 2014 and $274 by 2018. A business assessed at $1 million would see its tax rate increase by $3,660 in 2014 and $4,083 by 2018, according to the report.

The report said Lincoln would see an immediate savings of $450,000 on the cost of roads and $200,000 annually in the future.

The proposed village of Lincoln would have a mayor and four councillors, which would replace the existing advisory committee.