by George Orchiston Over the last several years successive city councils have continued the program of shifting the amount of property tax collected by the City of Powell River from Major Industrial to Residential.
Mayor Dave Formosa has stated that this tax relief to Catalyst Paper Corporation is now upwards of $20 million.
Much of this assistance has been facilitated through city council adoption of bylaws to establish “Revitalization Tax Exemption Programs” for major industry.
The current Industrial Property Tax Exemption Program ends this year.
However, on September 30, 2014, Catalyst applied to the city for a new agreement which would extend the capping of its industrial property tax at $2,250,000 through 2015 and 2016.
At its October 2 regular council meeting, city council adopted the first three readings of a new bylaw which would continue the tax exemptions provided to Catalyst by capping its industrial property tax at $2,750,000 for the years 2015, 2016 and 2017. While supportive of council’s proposal to continue with a Catalyst industrial property tax exemption, councillors Russell Brewer and Maggie Hathaway did call for greater tax fairness for the owners of residential property.
A final council vote to authorize the bylaw may be held at the October 16, 2014 council meeting.
We know where the current city council has stood on this taxing matter. In 2008, Formosa, Hathaway, Jim Palm, Debbie Dee and Chris McNaughton became city councillors while Brewer and Myrna Leishman were elected in 2011.
For the period 2008 to 2013, residential taxes have risen from 47.9 per cent of all city property taxes collected to 64.6 per cent, a 35 per cent increase. During the same period, major industry has dropped from 35.4 per cent to 16 per cent of all city property taxes collected, a 55 per cent decrease.
If, during the period 2008 to 2013, city council had kept the major industrial property tax rate at the 2008 level, the city could have received an additional $13 million from that sector into city coffers.
It must be remembered here, that many citizens who have been subjected to the large residential property tax increases are also the same people who were faced with an 18 per cent cut in their employment compensation package with Catalyst, all of which has resulted in less consumer spending in this community.
The answer to Catalyst’s request of the city to extend its industrial property tax exemptions is not an easy one. We know that the city’s infrastructure is suffering. For example, the city has yet to replace its main domestic water supply line from Haslam Lake after being advised in 2006 that it should be renewed; the city is not maintaining the Westview wastewater treatment plant so that it may operate within its environmental permit. We also know of the real economic concerns held by those who fear the closure of the Catalyst paper mill.
It is my hope that this issue is fully aired with the electors prior to the November 15 civic election and that a final decision to Catalyst’s request for further property tax exemptions be left to the new city council.
George Orchiston is a Powell River resident. Click here to see a table and graph detailing the change in residential, major industrial and small business taxes between 2008 and 2013.
