Larger Municipalities Will Retain $1.4 Million in Municipal Operating Grants

Mr. Speaker, I rise today to provide an update to honourable members on the final phase of planned reductions to the Municipal Operating Grants of 14 of our largest cities and towns. An official announcement was made earlier today.

When we formed the government three years ago, we had to make some difficult decisions. Included in those hard choices was the decision to reduce Municipal Operating Grants to the larger municipalities.

Mr. Speaker, despite the need to get our fiscal house back in order, we recognized that we could not apply reductions to Municipal Operating Grants across the board. Due to demographic challenges, many small and rural towns did not have the capacity to withstand a reduction to their operating grants.

There were however, 14 municipalities that were experiencing growth in their tax bases. Assessment data showed there was an increase in assessed property values in these municipalities which demonstrated potential for increase in taxation revenue, and less need for reliance on financial support from government to provide municipal services.

Mr. Speaker, I would like to extend sincere thanks and appreciation to the cities and towns that have worked with us these past two years and who have done their part to help the province turn the corner on its fiscal challenges. While these municipalities continue to show levels of growth, government is cognizant of the cost of municipal services.

While we still have a way to go, the province�s fiscal house is in much better shape. This improvement in our fiscal capacity allows me to announce that we are eliminating the planned final phase of reductions to the Municipal Operating Grants to those 14 cities and towns.

This announcement means that those municipalities will have an extra $1.4 million in their fiscal framework for next year to provide services to the citizens of Newfoundland and Labrador.

Mr. Speaker, this government recognizes that municipalities have a critical role in the provision of front line services in this province. We remain committed to providing major funding supports to all municipalities through our various capital works programs, through our Municipal Operating Grants and through our active pursuit of federal funding supports.

Thank you.

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