The New Brunswick legislature in Fredericton. Image: Brad Perry

The provincial government has introduced a bill which would freeze funding to municipalities for five years.

An Act Respecting Community Funding would provide an annual amount of $75.6 million for 2023 to 2027.

During first reading in the legislature on Tuesday, Daniel Allain, local government and local governance reform minister, said the changes are better suited for the new local governance structure which will be in place on January 1, 2023.

“We know how important stability is for the budgeting process for local governments and rural districts,’’ said Allain.

“We are ensuring stability and predictability as they transition from the status quo to their next exciting chapter of growth.’’

The current grant funding formula took effect in 2013 and has both equalization and core funding components.

The modernization of the local governance system has resulted in changes to local boundaries, responsibilities, and taxation powers that will affect community tax bases and funding requirements.

The sweeping reforms will mean all New Brunswickers will have an elected municipal government.

In the spring, an expert panel was formed to review the community funding and equalization grant and make recommendations.

“While we used components of the expert panel’s report, implementing their recommended new equalization formula at this time is not ideal as the restructured entities are all going through a significant transition in the next three to five years,’’ said Allain.

“We thank our municipal associations for working collaboratively with us and we have been listening to their feedback and ideas.”

The province said communities needing support will receive adequate funding and those financially stronger will not receive equalization.

Core funding will be redirected to support regional service commissions which will have greater responsibilities such as economic development, land use planning, tourism promotion and waste collection.