AUDIO – City of Powell River council adopted the 2013 financial bylaws at a special meeting on Thursday, May 9. Councillor Chris McNaughton brought forward more background information supporting the position council has taken on major industry taxation.
During the May 2 council meeting, when the bylaws received initial readings, Councillor Russell Brewer voted in opposition to the five-year financial plan and raised some concerns about the major industry tax rate. Brewer was absent with leave from the special council meeting.
McNaughton handed out a provincial government circular about provincial class multiples for 2013, which shows major industry is 3.40-to-one. “By taking Catalyst’s taxes to $2.25 million, we achieved that objective of equity and placed Catalyst’s taxes at about 3.65-to-one,” he said. “That was the number that we were targeting.”
Council has passed a resolution stating the objective is to achieve a three-to-one ratio, McNaughton also said, and has been moving toward that objective.
McNaughton said there was a danger in referring to a provincial average as Brewer did at the May 2 council meeting. “Yes, we are probably two-thirds lower than the provincial average if you just look at major industry,” he said. “But we are achieving the objectives that we set out to accomplish as a council.”
McNaughton also said all of council had time to discuss this during the budget process. “I would hope that in the future, and I appreciate councillors will make whatever decision they want on a resolution, but there’s a journey that we’re on and there’s lots of time for conversation,” he said. “I would hope that we would be able to have this conversation during the budget deliberations next go round.”
Brewer told the Peak the first draft of a five-year financial plan was presented to council at the same time as the council meeting on April 18. It had not been presented during budget committee meetings complete with the proposed budget through to 2017 and including schedule B, which includes the statement of objectives and policies.
As well, Brewer said, the financial plan assumes tax increases of three per cent for residential and one per cent for major industry and business through to 2017. “If we want to maintain what some have referred to as having achieved an equitable level of taxation for the residential, major industry and business tax classes at a local level, then the increases over the term of the financial plan should be the same,” he said.
There is an objective in the financial plan to move the tax class multiple for major industry to the “provincial average, which is estimated at approximately 3-to-1,” when in fact the provincial average is higher than this and the city is already below three-to-one for major and business, Brewer said. “The provincial average for major industry by municipalities is approximately 8.716 based on 2012 assessments whereas we are at approximately 2.978 based on our 2013 assessments,” he said. “There is a policy outlined in the financial plan that the city will ‘review and compare the distributions of tax burden relative to other municipalities in BC.’ This policy requires more focus.”
It is important not to confuse comments regarding major industry class taxation, which for Powell River is just one, Catalyst, with comments regarding business class taxation, Brewer also said. “The provincial average for business class tax multiples is approximately 2.72 whereas we are at approximately 2.854, so there is still room to reduce business class taxation to the provincial average if that were the objective,” he said. “For major industry taxation, Powell River is toward the very bottom of the list for major industry rates.”
The provincial class multiples for 2013 is the rate set by the province for regional districts to be used for setting tax rates for regional district requisitions levied on the hospital assessment base and used in setting tax rates for regional hospital district purposes, Brewer also said.
