Vernon adopts 1.99 tax rate

Vernon Morning Star May 14:

The City of Vernon’s 2009 budget is now written in stone after final adoption of the tax rates bylaw. “The city’s tax calculator is online. You can see the affect of the budget we passed,” said Coun. Bob Spiers, who opposed the budget with Coun. Patrick Nicol. The tax increase for an average assessed home is 1.99 per cent but Spiers has said it will be higher for many homes because of a shift in fire protection taxation and land (not just improvements) being levied for firefighting services.

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Don Quixote Note: The actual City portion of the taxes for the average house is 3.4% or $34.56 for the City of Vertnon taxpayer with the Okanagan Landing Taxpayer having a 13.2% increase or $121.83. NORD reductions will reduce the $amount down in both cases by $18.99. The average house is defined as a property valued at $414,406. ($196,843 land and $217,563 for Improvements) Check here for Calculation:

The City of Vernon's tax Calculator is now on line. Both residents and businesses can put in their property values to ascertain their tax situation for 2009.

Businesses still feeling taxed

By Richard Rolke - Vernon Morning Star Published: July 31, 2008

A Vernon politician isn’t convinced concerns about increased business taxes have been resolved. Mayor Wayne Lippert and Coun. Pat Cochrane recently met with the Downtown Vernon Association to discuss complaints about the commercial tax rate for 2008. “There is still a concern about the ratio from commercial to residential,” said Cochrane. “We have also heard from businesses in the north end that have been impacted. It’s far more than downtown.” Council recently received a letter from the DVA about this year’s tax rates. “We were told the increase averages 12 per cent, but many businesses are, in fact, facing a higher increase,” said Mary-Jo O’Keefe, DVA president, in the letter. “With this year’s municipal budget, the ratio of commercial tax rates to residential tax rates has surpassed the provincial average and yet our downtown merchants are not seeing any extra value or benefit for their greater contribution to the community’s coffers.”

O’Keefe goes on to say that individual businesses are being asked to bear a much larger share of the tax burden despite residential growth occurring at a faster pace than commercial activity. “This year’s dramatic increase in commercial taxation levels will make the cost of doing business in downtown Vernon substantially higher,” she said. “This will make us less competitive with other jurisdictions and therefore undermines our retention and recruitment efforts.” Lippert says the meeting with the DVA was a chance to explain the relationship between taxes and property assessments, and to look at some specific properties. “Some had gone up more than 12 per cent and others have seen decreases.” Lippert denies the downtown core is not receiving city services for the taxes it pays. “Taxes go for more than sidewalks and infrastructure,” he said. “It goes to policing and to make Cenotaph Park more people-friendly.”

Kaslo, B.C. cottage owners may be in for a tax hike

CBC News

The municipal council in Kaslo, B.C. wants non-residents to pay higher property taxes than those who live in the village year round. The community on the shores of Kootenay Lake in southeastern B.C. has seen real estate values skyrocket, partly because of speculation by out-of-town property owners, according to Mayor Jim Holland. "With this resort-style development, there's increased pressure and demands on the [residential] ratepayer that actually help support some of the more investment-style or development-style or speculative-style of real-estate market," Holland said. The mayor said he wants to adjust tax rates for non-resident landowners because rising real-estate values are making it harder for some locals to keep up. There are just over 1,000 permanent residents in Kaslo, a place with a strong volunteer spirit where permanent residents regularly participate in community projects. They deserve to be rewarded, Holland said. The trend toward market-driven real estate has created a need for a new way of taxing, Holland said, and that might mean absentee property owners will have to pay more.

"By creating a new property tax class it could give each municipality the option to increase or lower tax rates or whatever on those non-resident properties," he said. Last week, Kaslo's municipal council voted in favour of taking the proposal to the Union of B.C. Municipalities in hopes of gaining support. The next UBCM convention will be held in Penticton on Sept. 22. Vancouver mayoral candidate Gregor Robertson has floated a similar proposal. He wants the owners of Vancouver's 18,000 vacant condo units to pay business property taxes, rather than residential property taxes.
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Don Quixote Note: Will Vernon Council be supporting this proposal at UBCM ?

City spends big

CHBC- Video
Web posted on Monday, 09 June 2008

The Vernon mayor takes exception to a report painting council as irresponsible spendthrifts.

Mayor defends city’s spending

By Richard Rolke - Vernon Morning Star - June 08, 2008

Vernon’s mayor is refuting claims that city hall is one of the worst spenders in the province. A new report from the Canadian Federation of Independent Business looks at municipal spending, and it states that Vernon has the fifth worst record in B.C. “They need to look at the whole picture,” said Mayor Wayne Lippert. “The CFIB looks at it from a business perspective and they need to do more research.” The study claims Vernon in 2006 had spending growth of 46.9 per cent, population and inflation growth of 19.4 per cent and a fiscal responsibility gap of 2.42 per cent. But Lippert insists that Vernon’s spending has been reasonable and reflects both the need to upgrade aging infrastructure and the limited revenue base the city has. “They don’t take into account what municipalities have to do for infrastructure,” he said. “Property taxes are the only funds municipalities have to work with (compared to provincial and federal governments).”

The CFIB report indicates that municipal spending in B.C. increased by 36 per cent between 2000 and 2006 — 1.8 times more than the 20 per cent increase that would have occurred if spending had been held to population and inflation growth. In dollar terms, that amounts to $502 million in 2006. “The bottom line for taxpayers is municipal spending is causing property taxes and fees to increase faster than our ability to pay,” said Laura Jones, CFIB vice-president, in a release. “If municipal governments had controlled spending, property taxes could have been roughly 17 per cent lower than they are today.” Lippert doesn’t believe it is fair for the study to just target municipalities. “They missed the boat on regional districts because that also impacts municipalities and their budgets,” he said. “The regional district had a higher increase than the city and no one says anything about that.” Lippert also points out that the federal government has also forced changes on to how municipalities budget for infrastructure. “That has a huge impact on us,” he said.
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Don Quixote Note: Full report can be found at Fiscal Responsibility
Canadian Federation of Independent Business or backgrounder. Full Report

Audit Committee and Finance Meeting at 1 PM TODAY

May 29, Thursday:
Audit Committee 1:00 pm Kalamalka Lake Room
Finance Committee Following Audit Com.

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Don Quixote Note: I expect that the Auditors will present and explain the 2007 City Financial Statements at the Audit meeting. At the finance meeting I would anticipate the Grant policy procedures and protocol will be refined and discussion on the interim reserve policy will follow. I would expect some discussion on the $1.3 million or about 8% tax increase that will follow in 2009 from the decisions to support the first two parts of the Transportation Plan.

Free Coffee, Public and Media Welcome. This is not a DARK SIDE meeting !

The Reserve Policy Meeting of Friday May 16.

A Special Committee of the Whole meeting of Council was held Friday, May 16th, 2008, at 9:00 am in Council Chambers at City Hall to review the Interim Reserve Policy.

A bare quorum of 4 showed up (Beardsell, Cochrane, and Nicol absent) and the CFO Kevin Birtles made a presentation of the Policy including concerns that Coun. Beardsell had expressed in writing. There was some debate about several of the reserves and some resolutions about the timing of an annual reserve review (prior to June 15 each year?) and tools that could be used to 'assist in the accumulation of funds to meet the new requirements'. There were 4 directly cited and the assembled Council voted that the Capital reserves would have 'credit interest added in 2008 to these reserves'

The RCMP reserve was confirmed to be $849,090 (the 2007 budget surplus of $787,483 was reinstated from the Casino Reserve which shrunk to $320,519). The RCMP reserve was confirmed to be a reserve that would contain

• 'the net surplus from policing costs would be added to the reserve at year end'
• Transfers from this reserve will be authorized by council.
• The costs shall include determination of overhead costs for internal support. (no calculation of how much this would be for 2008 was proffered or agreed to yet.)

There were two reserves with name changes accepted by the council. The infamous Fringe Load Variance Reserve becomes the Salary Reserve and starts ins reincarnation with $290,000 in the pot. In the Sewer Reserve Group the much maligned 'Un-Named Reserve' becomes the Emergency Reserve and the projected 2008 ending balance will be $838,683. There were some small housekeeping items with the formal addition of a Heritage Reserve and the acknowledgment that there would be no change in 2008 for the BC Gas Lease Legacy Reserve.

About an hour into the session the Mayor was called away for a scheduled meeting in his office and prior to his departure the council quickly agreed to lending money from non statutory reserves to Capt. Bailey Way project ($2,000,000 from the sewer reserve group.) and $5,000,000 to the Hesperia Development Corp. from general reserves. It was then pointed out that there was more discussion needed on the state and amounts of actual reserves and the four Council members decided to refer it over to a Finance Committee meeting. The Scheduling of this new special meeting was not disclosed.

The agreement to 'partner' with these two entities with a formal vote on amount and term (but no interest rate?) prior to the required announcement to the public as specified in Articles 21 and 24 of the Community Charter are a concern as to process if not to substance. The announcements of the share purchase arrangements re these two City corporations and the assistance provided to give them seed money that were in Sunday's paper are troubling when they are done under the 'partnering' section of the Charter. Council was given a legal opinion from our lawyers at the last regular Council meeting but I have not yet read that and will reserve comments on this arrangement until I do so. (need a copy!). (more to come!)

At the start of each year for the last two or three I have indicated that the two top priorities of this council should be the DCC policy and rates and the Reserve Policy. We have this year finally adjusted the DCC rates and added a waiver of DCC's for non profit assisted housing etc. (Provincial Govt. approval still awaited) and have put $110,000 in the budget to hire a DCC consultant to make a thorough review and evaluation of all DCC projects and their public/developer split etc.

We have now had a one hour review of Reserves attended by a bare quorum of Council. I guess it is a start.

Coldstream taxes set

By Jennifer Smith - Vernon Morning Star - May 18, 2008

The average Coldstream homeowner will be handing over an additional crisp red bill for this year’s taxes. A tax hike of 6.95 per cent has officially been adopted by Coldstream council. The increase works out to approximately $49 more on the tax bill for the average home worth $483,750. The percentage jump is actually down more than two per cent from the original recommendation of 9.17 per cent. But extra money in the bank from 2007 meant the district was able to cut their original figure down. “We did better last year than we expected so that’s where that money comes from,” said Catherine Lord, director of financial administration.Coldstream’s taxes were adopted Monday, just in time for the May 15 budget adoption deadline.

Identical houses in Vernon and Coldstream compared for taxes.

They told me that it was unfair to compare the same price house in Kelowna against one in Vernon.

So I simply compared two houses that sit on opposite sides of the boundary line in Coldstream and Vernon. The prime difference seems to be City Taxes (including Fire) in Vernon that are substantially higher than comparable Coldstream rates.

These two identical homeowners can access the same regional amenities but the Coldstream homeowner has more money in his pockets after he pays his property taxes.

City Presents a Residential Tax example for 2008 taxes !

For the first time ever the City has made an attempt to show the year over year tax increase for an average residential taxpayer and it is should be commended for the effort.

However I suggest you view the assertions of a 2.04 for the general City's portion of the taxes as being suspect. It does not acknowledge the 11.4% increase for fire protection (in the old city) as part of general taxation as happens in all other cities in the province. As I posted earlier these would increase the taxes to 3.64% in the old city and only up to 2.20% in Okanagan Landing.

There is also 1 other thing that is curious about this comparison. When I made my original comparision I had to assume the improvements %age used was the same as last year i.e. 48% with land coming in at 52%. I cautioned that Your tax increase is dependent on your assessment and whether the land and improvements assessment have varied from the average increase from the last tax year.

In the City's comparison they too have assumed the same proportion this year as last year and I find that this is questionable. They must have an updated breakdown on the land and improvement ratios for their average $418,676 house and I suspect it is not the same as last year.

In my own property's case my land went up 53.6% while improvements went up only 7.9% for a net assessment increase of 23.5%. My actual tax increase all in will be 4.07% compared to the average house increase of 5.88% even though my net assessment is higher. If I recalculated my taxes using the same proportion as in this example my all in tax increase would be 8.32%. My original tax increase of $113.20 would have jumped to $231.61.

It is obvious that a more valid comparison would be one that uses the actual land and improvements values that are for that average house. In my case my land values have increased higher than the average but my improvements must be well below the city average. This has actually reduced my fire taxes this year by .76% compared to the City's average house increase of 11.4%
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This presentation is a good first step and the introduction of an online tax calculator for both residential and business taxpayer as will be debated on Monday at the open Council Meeting will be a valuable tool in next year's budget discussions. An example of such a calculator can be found here.

Raid on Policing Reserve sent to Finance Committee. Possible debate TODAY at 10AM in Kalamalka Room?

Meeting now postponed to THIS Thursday May 8.
Hopefully this will be added to the Agenda. (05/01)
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At the last COW meeting, watched only by a reporter from the Morning Star and Don Quixote the council delayed a decision on the transfer in of the $787,483 that would normally have been done in the year 2007.

Coun. Beardsell proposed a motion as suggested in the report from the CFO Kevin Bertles that this could be accomplished by transferring this money from the casino reserve. Despite some of the councillors who had sat on the previous Councils speaking out that they had assumed that this was an ongoing policy that had been approved by the previous Council NO ONE would second the motion.

Coun. Nichol proposed a compromise motion to send it to the Finance Committee to be looked at with regards to a solution and a future resolution to enshrine this as a resolution to staff that a transfer of the excess in the Policing Budget MUST be made each year to this Reserve. This motion passed 7-0.

The finance meeting is on Thursday following council meetings Hopefully this will be added to the Agenda.

At this Meeting I expect a recommendation from the Finance Committee to the next Council Meeting of the following points:

• Make a transfer on the 2008 books of $$787,483 to the Policing Reserve. (any decisions to use this money then can be made by debate and vote at an open Council meeting. )
• A resolution that the Treasurer MUST make a transfer to this reserve (or from this reserve if there is a deficit) at each year end. (This can be rolled into the ongoing reserve policy that has yet to be formalized)
• The amount to be transferred is the Net difference in the entire Policing budget not just the RCMP contract.
• Make a recommendation to use the newly discovered $177,000 in the fines revenue and whatever money is there from the Grants in Lieu (Budget is set at $150,000.) underestimation (est. $35,000), (actual money known by CFO from BC Hydro March 26/08) as a method to reduce the Residential Tax rates by at least 1%.
  

If The RCMP Reserve transfer had been done in 2007 (as it has been done in the 2005 and 2006 years) it will have no effect on the claimed 2.04% tax increase for the average residential owner.

The CFO's statement that policing is no different than any other operating divisions and that there are no operating carryovers in fire etc. is incorrect in that for the first time (published) in 2006 the Clerks Division, the HR and the IS divisions all were allowed carryovers. I'm sure that the same thing happened in 2007.

Lets solve this for all time with a proper resolution that recognizes that when the City Taxes us for Policing that they use this money for Policing unless they have the justification to spend it elsewhere and that justification can be demonstrated in front of the cameras at an open Council Meeting for all the people to see.

Taxing time in Kelowna

Ron Seymour 2008-05-06 Kelowna Courier

Kelowna homeowners will see their municipal taxes rise at least 12 per cent during the next four years, city council heard Monday. A financial plan forecasts a tax hike of four per cent in 2009, followed by subsequent annual increases of four, 2.2 and two per cent. “We are being as fiscally responsible as we can,” Mayor Sharon Shepherd said after the council meeting. Spending on the new Mission Aquatic Centre accounts for much of the predicted tax increase, she said. Without that, she said, tax hikes would be inline with recent annual increases of about two per cent. However, the projected tax increase of 12.2 per cent between 2009 and 2012 is based on the city providing the current level of services. Any decision by future councils to expand services or add new ones would create upward pressure on municipal taxes.

The tax increases outlook was presented as council gave final approval to this year‘s budget, which contains a municipal tax hike of 5.7 per cent for the typical homeowner. For someone whose home has increased in assessed value to $494,000 from $422,000, the municipal tax bill will go up $85, to $1,582 from $1,497. Their total tax bill, including charges for the school board, hospital board, and regional district will rise to $2,374 from $2,252, after application of the homeowner grant. “Like everyone else, I don‘t like to see taxes go up,” said Coun. Norm Letnick. But, echoing comments made previously by finance staff, he said the city has to buy large quantities of material such as concrete and steel, which have risen in price faster than the inflation rate. Given these realities, Letnick described the 5.7 per cent tax increase as “prudent.”

In recent years, the city‘s policy has been to direct half of all taxation revenue from new construction toward capital costs. However, this year, virtually all of that money is going toward operational costs. If that trend were to continue, many projects identified in the long-range capital works plan could not be built. So, finance director Paul Macklem said it was an “opportune time” for council to soon consider both the capital works plan itself, and the long-standing approach of using 50 per cent of new tax revenues to support it.

Traffic fines swell City coffers. City understimates by $177,365 (44%) in 2008 budget !

by Wayne Moore May 3 CASTANET
Southern Interior municipalities have raked in a record $4.3 million in traffic fine revenue this year. The funds help to enhance policing and community based public safety programs. Revenues from traffic fines allow municipalities to explore a wide range of projects, including outreach services for youth, Aboriginal policing, traffic safety programs and methamphetamine awareness programs. "This increased funding has also allowed municipalities to hire 560 new police officers," says Minister of Public Safety and Solicitor General, John van Dongen.

The breakdown of traffic fine revenues for interior communities includes:

• Vernon - $580,000
  
• Coldstream - $52,000

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May 03 Don Quixote Note: On April 12 I posted and on Apr. 14 I submitted in writing at the public input the information about the underestimation of fine revenue: Agenda Package - 9.93MB
Summary and responses to the public input session:Tax Increase P.203. P.36-39 of above agenda package is my original input.:

In the 2007 budget the anticipated fine revenue for acct 216200000 Prov. Govt Revenue Sharing Grant was $394,740.
The actual amount received was $495,253 an unexpected windfall of $100,513.
The 2008 budget has been set at $402,635 which is 2% above last years budget and $92,618 below what we received last year.
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The response to my original questions citing other underestimations of revenue and overestimations of expenses was the answer by the CFO:

Mr. Spiers has requested a zero percent increase in taxes. In support of this position he has cited a number of individual items contained within the Financial Plan where he feels there is room for a reduction in expenses or an increase in revenues.
ANSWER: Planned moderate increases in taxation to fund service expansion and cost inflation reflect the real cost pressures and initiatives undertaken by the City.
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As it turns out the revenue that we will actually receive is $580,000 which is $177,365 more than we budgeted for. This is a miss by 44%.
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On April 23rd I sent an e-mail to Anne.(NameWithheld)@gov.bc.ca :
I have seen the publication of the 2008 fine revenue for the Coastal region and the Kootenays so far. Can you advise when we will see the North Okanagan figures.Especially interested in Vernon and Coldstream for budget purposes. Thanks in advance for your help. (End of Message)

The person was the liaison officer named in one of the already named press releases. She did not reply to me knowing full well that the beloved leader Ida Chong would make this news release at the end of the SILGA convention. In this day of cooperation between the municipalities and the province you would have anticipated that the province would have informed municipal treasurers of any large increase so they can present a realistic budget.
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Well it is still before the final vote on the budget on April 12 and this large error of $$177,365 can still be used to adjust our tax increase down by at least 1%. This would cut the announced tax increase (excluding fire) from 2.04% in half. This would also cut the real business tax increase in half. This must be put on the finance committee meeting of Thursday May 8 so the CFO can make these adjustments in preparation for Monday.

Communities get cash

Morning Star May 4

North Okanagan municipalities will see more traffic fine revenue going into their coffers. The provincial government announced Friday that a record $4.3 million in traffic fine revenue will go to 11 Southern Interior communities in 2008. Coldstream will get $52,929 while $73,041 will go to Lake Country and $26,417 to Spallumcheen. There will be $580,656 going to Vernon.
“Through this program, we’re returning funding to local governments to invest in programs or services that make our communities better, safer places to live,” said John van Dongen, public safety minister. It was also announced Friday that unconditional grants are being increased for small municipalities. There will be $464,392 for Armstrong, $345,627 for Coldstream, $405,220 for Enderby, $323,008 for Lake Country and $332,339 for Lumby. Spallumcheen will receive $449,773, and $142,000 for the North Okanagan Regional District.
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Don Quixote Note: In the 2007 budget the anticipated fine revenue for acct 216200000 Prov. Govt Revenue Sharing Grant was $394,740. The actual amount received was $495,253 an unexpected windfall of $100,513.

The 2008 budget has been set at $402,635 which is 2% above last years budget and $92,618 below what we received last year. As it turns out the 2008 revenue that we will actually receive is $580,000 which is $177,365 more than we budgeted for. This is a miss by 44%.

The story from the local newspaper was one that contained large numbers and consequently was confined to the back pages of this esteemed local adrag as been inconsequential and incomprehensible to the average taxpayer. Big numbers or any numbers seem to confuse their reporting staff.

Let's see if the local Council is less confused than the newspaper that covers them and orders a reduction in local taxes at Tursday's finance committee meeting !

Budget tax hike set at 5.66% (Kelowna)

Castanet May 4
Kelowna city council will be asked to finalize its budget Monday, leaving city homeowners facing a 5.66 per cent tax hike. Estimates for the revenue from new construction, figures which cannot be included until the B.C. Assessment Roll is established in the new year, overshot the mark this year. The city will collect $663,000 less than expected for new building, though it will still add another $3.2 million to home and business property owners’ tax contributions. A 5.66 per cent average tax increase does not necessarily mean that every property owner’s tax bill will be up by that amount. Property tax is calculated on the assessed value of property, meaning those who see assessments greater than the average change will experience a correspondingly higher net tax increase. Conversely, properties experiencing a market assessment change of less than the average will experience a correspondingly lower net tax impact.Some 2.86 per cent of the tax increase will go toward covering the new aquatic centre.

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Don Quixote Note: I expect that City Hall may make reference to Kelowna's tax rate being much higher than Vernon's. However when you strip out their 2.88% for the new aquatic centre (and remember that our new civic complex that was defeated would have added about the same percentage) you get back to the core tax increase rate which is 2.78% (5.66-2.88)

Much higher than Vernon's announced 2.02% rate Local Politicians will crow. But look again and notice that Kelowna's fire taxes (not to mention Parks charges are already included) and Vernon's fire taxes are excluded and the Parks charges will be added when you get your NORD tax bill. The average tax bill including fire for the old city resident of Vernon is 3.64% and jumps to 5.12% when NORD is added (See table )

But because of the windfall of $177,000 from the fine revenue that was estimated on the low side Vernon may get at least a 1% drop in our taxes if our Council deems fit. Lets encourage our local Politicians to make the correct choice by e-mailing them on their blackberries.
Their e-mail addresses can be found here.

You can simply add the following link to your own personal message . http://vernonblog.blogspot.com/2008/05/taxes-for-city-fire-and-nord-starting.html

Kelowna winds up with $1.9 million left over from ‘07

Kelowna Daily Courier May 3
Higher-than-expected revenues from building inspections helped the City of Kelowna end 2007 with a $1.9-million surplus. Council will receive a report Monday recommending that most of the surplus be directed toward future capital projects, including $1 million for roadwork. Just under a third of the surplus would go toward the snow-removal budget, parkland purchasing and civic facilities. The city normally ends each year with a surplus, which recently has been averaging about $3 million. “We need to budget conservatively, because we can‘t afford to get into a deficit,” finance director Paul Macklem said Friday. Along with higher fees generated by the inspection services department, the city received more money than expected from Victoria through a program designed to share revenues from local gaming operations. As well, some programs that were scheduled and budgeted for last year did not proceed for a variety of reasons. Staff vacancies also generated some of the surplus.
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Don Quixote Note: By contrast Vernon's final surplus from the 2007 draft financial Statements was $84,096. Most of the actual surplus was used on Middleton Way in the amount of $1,420,691 as this underestimated project was completed when no grants were obtained. In addition $787,483 of the intended transfer to Policing Reserves was not done.

Taxes for City, Fire and NORD starting to add up.

The 2008 budget was approved by a 5-2 vote on Monday. Voting against the budget were Councillors Cochrane and Beardsell. The claimed tax increase is 2.04% for the average house which is assessed at $418,676. This does NOT include the Fire Taxes for an average house as Vernon remains the only city that has a specified area tax for fire and calculates it separately. (Actually 2 fire specified areas - Landing and old city which have different rates.) I have used the data provided and the table illustrates the effect of the fire tax on an average house assessed at $418,676 using the same improvements %age as was used last year.Tax increase plus fire comes in at 3.64%

Adding in the NORD tax increase which is 8.39% for this average house the final tax increase (excluding Hospital, school, Library and misc) for Old City residents is 5.12% while Okanagan Residents will see an increase of 4.22%.

Your tax increase is dependent on your assessment and whether the land and improvements assessment have varied from the average increase from the last tax year. You can plug in your assessment and use the rates in the table. (Make sure you use the proper rates when the tax is on improvements only (Fire, NORD 2) or on land only as in the case of NORD 1 (S.I.R. program)

Businesses face "extreme" tax increase

107.5 KISSFM Pete McIntyre

The city of Vernon's new budget has been approved--- but not without some opposition. Councillor Pat Cochrane voted against it over concerns about the impact to the commercial taxpayers. Cochrane tells KISS FM, "It's in the range of 12 percent and I consider that an extreme increase and I think that's wrong. "I think we should have taken steps to find a way to get the commercial increase down to a closer percentage increase to the residential increase." Councillor Barry Beardsell also voted against the new budget. For residential taxpayers, the increase is 2.04 percent which works out to an extra $16.39 dollars for the average homeowner (assesed value of $418,000). Mayor Wayne Lippert says the increase is needed to improve infrastructure like roads and sewer.

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Don Quixote Note: The 2.04% increase does not include the fire tax which will bring the City's portion of municipal taxes up to 3.64%.

Contrary to the Mayor's assertion that the increase is for 'sewer', this increase has nothing to do with the increases that will be coming to your sewer rates. The sewer portion of your quarterly payments to the City are a utility charge and are billed separately from taxes.

Tax Increase for City is 3.64%

The 2008 budget was approved by a 5-2 vote yesterday. Voting against the budget were Councillors Cochrane and Beardsell.

The claimed tax increase is 2.04% for the average house which is assessed at $418,676. This does NOT include the Fire Taxes for an average house as Vernon remains the only city that has a specified area tax for fire and calculates it separately. (Actually 2 fire specified areas - Landing and old city which have different rates.)

I have used the data provided and the table illustrates the effect of the fire tax on an average house assessed at $418,676 using the same improvements %age as was used last year.

Tax increase plus fire comes in at 3.64%
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Don Quixote still wants a 0% tax increase !!

Agenda Package - 9.93MB
Summary and responses to the public input session:
Tax Increase P.203
Mr. Spiers has requested a zero percent increase in taxes. In support of this position he has cited a number of individual items contained within the Financial Plan where he feels there is room for a reduction in expenses or an increase in revenues.
ANSWER: Planned moderate increases in taxation to fund service expansion and cost inflation reflect the real cost pressures and initiatives undertaken by the City.
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Don Quixote Reply to this Point:
In P.36-39 of above agenda package is my input.
Part of my reply was in regards to the point always brought up by some councillors that they have to at least have a raise each year to cover the cost of living increases etc:
Council may say that a 2.04% tax increase is necessary to ensure that we continue to look forward and not go back to the days of McGrath and the low tax hikes that caused us to fall so far behind in infrastructure maintenance and replacement. Get over it. That was 8 years ago and those small tax increases were funded by growth and a Provincial Government annual subsidy that was removed in the late 90's. It was replaced in the early 2000's by larger than anticipated Casino monies and lately by unexpected (at least to the CFO's if you believe how they budgeted for it) returns on short term investments, unbudgeted building fee revenue and a residential growth spurt that brought in massive sums of new tax money. Despite this growth that in the words of Coun. Cunningham should benefit the existing taxpayer , she don't see no change to her taxes. (Not mentioned was the 2003 tax revenue realized when the landing's 10 year tax holiday ended)
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What I pointed out was that the budget that they were attempting to pass with a 2.04% increase contained all the projects that were required for 2008, all service level adjustments and the COST of LIVING factor was built in to all the necessary line cost items. I then went on to show that there were costs that were overestimated (proved out by budget vs. actual tender) and revenues that were underestimated (Fine revenue, Hydro Grants in lieu) that could easily reduce this TAX REQUISITION to 0%.

We have had large increases in revenue put into this years budget including over $300,000 in building permit fees from a single new development, over $1,200,000 to account for return on short term investments, and large increases in excess of $600,000 in new growth tax revenues.

Growing the tax base should provide a larger revenue pool that should allow some tax relief. It was recently recognized in Spallumcheen when they lowered their residential taxes.

A Quote from Spall's Mayor : "It was “because of the growth that we had. We were able to pass some of that new growth savings back to the homeowners,” he said Tax rates decreased across the board but increased assessments will see the township increase revenue substantially from major industry (nearly $67,000), light industry (almost $22,000), and residential properties (about $30,000). “As long as we achieve a balance and we still offer the same level of services, then we can pass those savings onto the ratepayers and bring those taxes down,” said Hansma.