A majority of City of Powell River councillors passed the initial readings of financial bylaws that establish tax rates during the May 2 council meeting.
Councillor Russell Brewer voted in opposition to the five-year financial plan bylaw and Councillor Maggie Hathaway announced she intends to try to eliminate the city’s flat tax next year.
After doing more research into the provincial government’s Property Tax Deferment Program, Hathaway said, she concluded it overrides any reason for the flat tax. “Next year I’m going to be pushing for complete elimination of the flat tax,” she said.
The program allows homeowners to defer property taxes at an interest rate of one per cent, which is not compounded. “It takes care of that inequity where people’s assessments went way up in a short period of time,” she said.
Brewer pointed out deferring $2,000 in property taxes would cost $20 under the provincial program. He also said he believes the flat tax has to be examined in more detail next year.
As well, Brewer said the major industry average
for the province is 8.7 and Powell River is at 2.97. “We’re pretty much three times below the provincial average for major industry tax rate,” he said. “Further, of the 76 municipalities that have major industry taxation, we’re fifth lowest.”
Two of those municipalities don’t have much major industry, Brewer said, which makes Powell River the third lowest. “We’ve done our share of reducing major industry taxes, in my opinion,” he said.
A statement of objectives and policies in the 2013-2017 financial plan notes that through a revitalization tax exemption bylaw, the city will tax Class 4 major industry at $2.25 million in 2013 and 2014.
Another objective is to move the property tax class multiple for light industry, business/other and major industry to the provincial average, which is estimated at approximately three-to-one.
Port Alberni has frozen its major industry taxation until 2015 as well, Brewer said, but at $4.8 million, compared to Powell River, which is at $2.25 million. Major industry assessment is lower in Port Alberni than Powell River, he added. By 2015, Port Alberni will have collected just under $20 million more than Powell River, he said. “I think that’s important to point out,” he said. “For me, those are important considerations. They should be reflected in these objectives and policies next year.”
Councillor Chris McNaughton pointed out Sechelt targeted its small business tax rates at a two-to-one ratio and there were many communities with a significantly lower ratio than the provincial average.
McNaughton also pointed out Powell River’s major industry taxes were already lower than Port Alberni, North Cowichan and Campbell River. “We were following certainly a trend that had been established by previous councils,” he said. “But I think, more importantly, if you look at Campbell River, its tax requisition is zero from Catalyst [Paper Corporation] now, or pretty close.”
Councillor Debbie Dee said council had to make “tough decisions” because the Powell River mill had a “bull’s eye” on it. “I don’t think there was ever any talk about closing Port Alberni, but there was definite talk about closing Powell River,” she said. “We had to do something drastic and yes, we did something drastic and now I think we have positioned ourselves well for 2015, as well as our major industry.”
Council is expected to adopt the 2013 financial bylaws at a special council meeting scheduled for 11 am on Thursday, May 9.
