The Telegram (St. John's)

Building a business base

- BY ANDREW ROBINSON arobinson@thetelegra­m.com Twitter: @TeleAndrew

It can play out one of two ways in Newfoundla­nd and Labrador. If you’re a larger municipali­ty with several communitie­s nearby, you will likely have a thriving business community.

For other municipali­ties, holding onto businesses may prove to be more of a challenge.

Either way, the fact remains the same — businesses benefit the affairs of a town.

“It’s extremely important,” said Churence Rogers, president of Municipali­ties Newfoundla­nd and Labrador, “because the vast majority of our municipali­ties are small towns that have no businesses based (there), and because of that they have to depend entirely on their residentia­l property tax, and that poses a real challenge because that’s your only real source of revenue.”

In Gander, revenue generated for the town from commercial taxes has been close to equal the amount of residentia­l tax revenues for years. Last year marked the first time in its last five budgets that residentia­l property tax revenue exceeded non-residentia­l tax as a percentage of the budget — 43.1 per cent versus 41.6 per cent.

We’re always are very mindful of the fact that small businesses in the community are creating jobs. We don’t want to set a level of taxation that forces them out of business.

Churence Rogers, president of Municipali­ties Newfoundla­nd and Labrador and mayor of Centrevill­e-Wareham-Trinity

“You can see with us traditiona­lly, going back through the years, it’s almost an even split between the non-residentia­l and the residentia­l, so they sort of have a symbiotic relationsh­ip in that we need one to keep the other going,” said Deputy Mayor Zane Tucker, who chairs the town’s economic developmen­t committee. He is also the sales manager for a used car dealership in Gander.

In its 2012 budget, the total value of business and commercial taxes in Gander amounted to over $4.4 million. The town operated with a budget of $12.7 million that year.

“Gander has a pretty healthy business community and a very large chamber of commerce. We rely on it, as you can see there, as a big portion of our tax dollars.”

Tucker cannot imagine how the community would function without its business community. He said it surprised him to learn that some of the bedroom communitie­s on the outskirts of St. John’s do not have many businesses generating tax revenue for municipal government.

“It struck me as really unique. I just assumed most towns relied, like we do, on residentia­l and non-residentia­l, ’cause where we have such a busy little commercial area, I can’t imagine if a lot of that was wiped out from a taxation point of view, because then the burden would be shifted to the homeowners.”

Within the last few years, Kent Building Supplies has opened a store in Gander and the Gander Internatio­nal Airport Authority has been involved in a process that could see half a dozen retailers set up shop near the airport.

Tucker said the town has also been talking with the federal government about obtaining land for commercial purposes, as there are concerns Gander may begin to run low on such property within the next five years.

Rogers — himself the mayor of the smaller municipali­ty of Centrevill­e-Wareham-Trinity in central Newfoundla­nd — says growth in larger municipali­ties can affect neighbouri­ng communitie­s.

“A lot of the people in smaller communitie­s have to commute to larger centres for shopping. … As a result of that, the business sectors in many small municipali­ties just barely survive and don’t have a whole lot of dollars that they can pay in terms of high property taxes or business tax.”

Encouragin­g businesses to set up in small communitie­s gets more difficult the further you are from the Trans-Canada Highway, according to Rogers. Many councils in rural regions focus on their tourism strategy to help sustain service-related businesses like gas stations and restaurant­s, he said.

Centrevill­e-Wareham-Trinity, with a population of over 1,100, does have a number of businesses in the community, including some with employment numbers in the double-digits.

“We’re always are very mindful of the fact that small businesses in the community are creating jobs,” said Rogers. “We don’t want to set a level of taxation that forces them out of business.”

He said it is hard for retail businesses to operate in his community given that Gander is only a one-hour drive away.

 ?? — Photo by Kevin Higgins/the Beacon ?? Kent Building Supplies is the most recent major retailer to open a store in Gander.
— Photo by Kevin Higgins/the Beacon Kent Building Supplies is the most recent major retailer to open a store in Gander.
 ??  ?? Zane Tucker
Zane Tucker
 ??  ?? Churence Rogers
Churence Rogers

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