Amalgamation would come with cost, but it’s small ! (KELOWNA)

By Ron SeymourFriday, March 9, 2007 Kelowna Daily Courier

Expanding Kelowna‘s boundaries across Okanagan Lake to take in the Westside would have a minimal financial impact on taxpayers, city council will hear Monday. The owner of a typical home assessed at $309,000 would see his or her municipal taxes rise by just $14, consultant Robert Prosser says. A provincial offer totalling $25 million and another $4 million in new revenues would help to build up service levels on the Westside and reduce the costs of a boundary extension to Kelowna residents, Prosser says. “Our analysis indicates that boundary extension would have little to no financial impact on existing Kelowna taxpayers,” Prosser, a former auditor general for the City of Saskatoon, writes in his 21-page report to council. The owner of a Kelowna home assessed at $348,000 would see an increase of $16 in municipal taxes, according to the report. Earlier this year, city council passed a resolution supporting the idea of a boundary extension in principle, so long as it doesn‘t negatively affect taxpayers.

Given Prosser‘s report, city manager Ron Mattiussi recommends that council endorse a communications and consultation plan with city residents. Among other things, that would include advertising and a survey in April of 400 randomly selected residents, with people being asked whether or not they support the idea of a boundary extension. Taxes don‘t rise for Kelowna residents as much as some people might believe under a boundary extension to take in the Westside because city hall would begin collecting millions of dollars in new revenue from people who live on that side of the lake. So, while it‘s generally true, for example, that Kelowna residents would start to shoulder some of the burden for improving policing, roads and other services on the Westside, people on the Westside would begin paying for city amenities, such as the new Mission pool and leisure centre. Essentially, there would be something of a balancing out in taxation levels on both sides of the lake under the boundary extension proposal.

While municipal taxes on the Westside have historically been as much as 30 per cent lower than in the city, that gap has narrowed in recent years to about 10 per cent. Prosser‘s financial analysis of the costs of a boundary extension generally mirror that conducted earlier by a consultant hired by the committee overseeing the Westside governance debate. Committee chairman Doug Findlater said Friday he was pleased with the similarity in the findings. “He‘s basically verified our analysis,” Findlater said. “People sometimes make comments to us, ‘Oh, your financial estimates are way off.‘ But Prosser has done his due diligence, looked at all the factors and come up with very similar numbers,” Findlater said. It‘s predicted that taxes on a typical Westside home assessed at $308,000 would rise after eight years from $1,637 today to $1,873 if the area joins Kelowna, and $1,950 if incorporation is chosen. Westsiders will vote in a referendum in late May or early June whether to join Kelowna, create a separate municipality or remain an unincorporated area in the regional district.

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Don Quixote Notes: The governance costs for the Westside can be found at http://westsidegovernance.org/background_analysis.html

They even explained the cost of the gas franchise fee to each homeowner deciding on how they voted. Amalgamation would cost an average of $45 per year.

Kelowna City Pages (2006)
Terasen Gas Franchise Fee, representing 3% of their 2005 sales, will increase by $235,340 in 2006. Current base budget revenue is $1,172,985.