Holt government introduces 2 major affordability bills

The Holt government has introduced two pieces of legislation aimed at keeping its promises to make life more affordable in New Brunswick.

The rent cap bill will limit residential rent increases to three per cent a year starting on Feb. 1, 2025.

And the repeal of the so-called "carbon cost adjustor" will shave around four cents off the per-litre price of gasoline before the end of the year.

Housing Minister David Hickey introduced the rent cap legislationWednesday. It's expected to be debated and passed before the legislature adjourns for Christmas.

Any increases greater than three per cent that take effect before Feb. 1 will not change, including those covered by current rules that allow the spreading out of large increases over two to three years.

But the portion of any phased-in increase taking effect on Feb. 1 or later will also be capped at three per cent.

It's already too late for landlords to jack up rents ahead of the cap because of the existing requirement of six months' notice for increases.

"They've thought about a way to do it so we don't have landlords rushing to get in one last rent increase before the rent cap is put in place," said Tobin LeBlanc Haley of the New Brunswick Coalition for Tenants' Rights.

"That is great."

Landlords will be able to apply for increases above the three-per-cent cap, but only to a maximum of nine per cent, and only if they can show that the increasesare needed because of renovations to their units.

WATCH | How 2 Liberal bills will address affordability:

Rent cap, carbon cost repeal on the way to address N.B. cost of living

21 hours ago

Duration 1:58

New Liberal governments two pieces of affordability legislation were promised during the recent election campaign.

Willy Scholten, a board member with the New Brunswick Apartment Owners Association, saidthat won't be enough for landlords like him.

"We need cost control if we're going to have rent control," he said, pointing to increases in property assessments of 10 per centor morefor some owners now faced with a three-per-cent cap on what they can take in.

"There should be balance in the whole equation," he said. "Otherwise we're going to be sending a pretty negative message to rental housingproviders."

Hickey told reporters he agrees on the need for balance and that's provided by measures like the planned removal of the provincial sales tax on construction costs for new apartment buildings.

But Scholten said developers will still be reluctant to build new properties if they know their rental income won't be allowed keep up with property tax increases.

The cap will be reviewed every year and adjusted based on the inflation rate and vacancy statistics.

A landlord will be able to increase rent at a higher rate only when a new tenant moves insomething LeBlanc Haley saidwill still deliver shocks to rental prices.

"What that means is there will be an incentive to turn over those units in order to increase rents over and above the rent cap," she said.

Under existing legislation, landlords can increase rents only once a year and must give tenants six months' notice.

Any increase that exceeds a threshold linked to inflation a threshold currently set at 3.8 per cent can be phased in over two or three years.

Landlords must also apply if they want to terminate a lease and remove tenants for renovations so-called "renovictions."

Officials say there have been 123 such applications from landlords so far this year and only nine have been approved.

The second affordability bill introduced Wednesday repeals legislation introduced by the Higgs government in 2022 in response to federal clean fuel regulations.

It added an "adjustor" clause to the Energy and Utility Board's price-setting formula so that the cost of the regulations 4.5 cents per litre of gas this week could be passed on to consumers.

The Progressive Conservative government said at the time that without the clause, small, locally owned gas stations would bear the brunt of the costs.

The Green Party said at the time the provision was designed to cater to the Irving Oil refinery in Saint John.

Energy Minister Ren Legacy saidthere are EUBmechanisms to protect small retailers, and the new government's priority was to help New Brunswickers.

"We had an opportunity to reduce the cost for consumers by four cents and we took it. That's what was available to us and we took it," he said.

Legacy said the bill will remove the adjustor from the EUBformula as soon as it becomes law, which is expected to happen before the legislature breaks for Christmas on Dec. 13.

That means gas prices could drop before Christmas.