For the second year in a row, the Fredericton International Airport is benefiting from a property tax freeze while thousands of residents will see their rates increase again.

“I would say it’s totally unfair. It just doesn’t make sense to me that they would do this,” Joe Wood said, referring to the budget plan passed by the City Council last month.

Wood lives in Douglas, now part of Fredericton. He is one of about 4,500 residents affected by Fredericton’s January 2023 amalgamation as part of province-wide reforms.

Fredericton International Airport was also included in the merger.

In the first year after the merger, the city increased property tax rates by five cents for all of these new residents, as well as for the airport.

But this year, the council opted to increase the tax rates paid by the newly merged owners by 10 cents, while freezing the rate paid by the airport. The same is expected to happen next year.

WATCH | Airport property tax remains unchanged while some residents’ rates skyrocket:

Many Fredericton homeowners see property taxes increase, while airport taxes stay the same

City council has agreed to keep the Fredericton International Airport property tax rate frozen for two consecutive years, while increasing the rate paid by the thousands of residents added in the recent amalgamation.

Since the amalgamation took effect, the City of Fredericton has been working to align the rates paid by new owners with the city’s internal tax rate, the councilor said. Greg Ericson, who also serves as chairman of the city’s budget and finance committee.

This internal tax rate – paid by owners who benefit from all municipal services – will amount to $1.3086 per $100 of assessed property value next year, compared to the rate for the merged zones, which will vary from $0.6159 to $0.7286 depending on the area. , in addition to a provincial road maintenance tax rate of $0.4115.

Economic development cited as reason for rate freeze

The airport’s property tax rate, however, will remain frozen at $0.5042 — a move made to help it rebound from a pandemic-related slowdown in passenger air travel, Ericson said.

“It’s basically an economic development measure,” he said in an interview.

“We know, having worked with the airport, the challenges it faces in recovering its market share following COVID, then balancing the new expenses associated with its renovation, the council has therefore made the decision to maintain its bill stable tax.”

Ericson said that even if some residents never use the airport for travel themselves, subsidizing its operations by giving it a lower tax rate benefits all residents.

“The airport is truly an economic engine for most of western New Brunswick and … having a high-quality airport for the capital is a very important thing.”

CBC News asked the Fredericton International Airport Authority for an interview about the need to keep its property tax rate frozen.

Spokeswoman Kate O’Rourke said in an email that questions should be directed to the city. But she added that the annual economic impact of the airport is $254 million, although she said the Canmac Economics study showed that amount would not be released until next year.

CBC News asked municipal officials in the cities of Dieppe and Saint John if they provide tax benefits to their respective airports.

Both municipalities responded by email that this was not the case. Kevin Fudge, Saint John’s chief financial officer, added that non-residential properties pay a rate 1.7 times higher than residential properties.

Tax benefits not uncommon, expert says

Still, it’s not uncommon for Canadian municipalities and provinces to grant tax breaks to help keep airports afloat, said John Gradek, a McGill University professor of supply networks and infrastructure management. ‘aviation.

In New Brunswick, airports, including Fredericton, are already exempt from paying provincial property taxes.

Given the economic fallout and the challenges of closing the airport, Gradek says he sees the tax freeze as a profitable investment on the part of the City of Fredericton.

“If you operate a catering business in downtown Fredericton or if you operate a bus service or if you operate taxis in Fredericton, business is created, you know, through air passenger traffic. using the Fredericton airport,” he said.

The importance of the airport to Fredericton’s economy is not lost on Wood, who said he understands that some businesses profit from the spending generated by travelers to the city.

But while he and his neighbors are already struggling with skyrocketing property values, he thinks it’s unfair to offer relief to one particular taxpayer while raising rates for others.

“There are a lot of people here who have been affected by COVID and everything that’s happened with it, whether they lost their job or they were laid off for a period of time… And in the meantime , the assessments keep going up and the tax bill keeps going up, and they’re trying to recover from what they’ve been through.”