Page 33 - From 'Company Town' to 'Labour Town'

ISSUE : Issue 37

Published by Ronald Caplan on 1984/8/1

of its true value and more than $3 million in property was exempt from taxes until 1928; under these conditions the company's taxes had never exceeded $15,000 a year and had dropped from seventy-four percent of the total tax in 1898 to thirty-four percent in 1916. When the Nova Scotia Steel and Coal Company passed to American control, however. President F. J. Crockard agreed to revisions in the assessment. By 1919 Scotia had accepted an assessment of $1.2 million, which constituted about half the total assessment in Sydney Mines. In Glace Bay the traditional arrangement pro? vided that Dominion Coal would match the assessment for the remainder of the town and thus pay half the town's property tax. In 1919, however, the Glace Bay council broke this arrangement and unilaterally in? creased the company's assessment from $2 million to $2.5 million. Dominion Coal pro? tested and successfully appealed to the courts. Subsequent negotiations were fruit? less; the company insisted that the fifty percent arrangement was a fair basis for taxation, while the town claimed that a new inventory of the company's assets was needed. The council then attempted to raise the total assessment by increasing the valuation of other properties in the town. A more aggressive town assessor was appointed; his new survey of property in? cluded considerable increases in the as? sessment of the local branches of the Roy? al, Commerce and Nova Scotia banks. To the delight of the council, the courts sup? ported the. town's revisions. The tax bur? den for property owners, especially the chartered banks, was increased, and under the customary parity principle Dominion Coal was forced to match the increased as? sessment. As a result of these efforts by 1925 the town's total assessment was raised by about $1 million to more than $5 million. Nevertheless, none of the coal towns es? caped financial crisis during the 1920s. The growth in municipal debt was the re? sult of debts incurred in the construction of services in earlier years, and of new spending which the town councils found es? sential. In Glace Bay the town's main school building was destroyed by fire in 1'20, and the town undertook large expendi? tures to finance a new building. Two is? sues of bonds were required, and these were placed with difficulty and on poor terms. In the end Glace Bay boasted the "best school building in Eastern Canada," but the town's capital debt was increased by $475,000. In Sydney Mines the town coun? cil continued to approve capital spending in the expectation of a wider tax base when long-term tax concessions to the Sco? tia company expired in 1928. But the clo? sure of the Sydney Mines steel plant and the Jubilee colliery threw the town into crisis. Employment, population and assess? ment all declined after 1921, and in 1926 Scotia secured from the courts a one-third reduction in its assessment. Finally, the deepening economic crisis of the 1920s con? fronted the towns with a steep rise in un? collected taxes. Nothing revealed the essential interdepen? dence of industrial and residential life in the coal towns more clearly than the problem of underground subsidence. The min? ing communities were also the physical site of the coal industry. As a result the Stores To Serve You CAPE BRETON SHOPPING PLAZA SYDNEY RIVER '??' Featuring JjWflfo The crossroads of cap* Breton'' Sobeys & Shopper's Drug Mart ??''*''y' * "" • ' ii 10 p.m.

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