As per section 312 of the Municipal Act, a municipality can create a special service levy for a number of expenses, such as highway construction, recreation support services, grass and weed control and others. The proposed by-law would include EMO and animal control, which is added on to previous by-laws services like street lighting, fire and police. As Swanson said, it is not a new concept, just an extended one.
“We didn’t just add a new tax to your bill. The monies for this are already in the budget. What we are doing is taking the bylaw that is there, and we will have to repeal that by-law and put in a different by-law.”
Swanson turned over the meeting to Administrator Leo Poulin, who explained the proposal and the reasons. Poulin said this proposal, which would see two by-laws repealed, would apply to all residential, commercial and institutional properties in the urban community. He had the estimated costs for all of the services under the by-law’s scope for 2019, and the total would be $397,000. The last year of the by-law, 2023, would see those costs rise to an estimated $430,000.
The main change to the levy, other than adding a couple of services, is to introduce a per parcel amount. In the past, the Town of Boissevain had a per parcel levy for garbage collection. Now this concept would be added to a part of this new levy. Fifty-eight percent of the levy would still come from assessment - $230,260 in 2019. However 42%, or $166,740 would come from each property. Once this is put onto the 859 properties in Boissevain, each would wind up paying $195 per parcel in 2019, as well as any assessed portion.
The reason for doing this, according to council, is to make the tax system more fair. There have been complaints from some in the higher assessed areas that they were paying too high a percentage for services. As Poulin explained, the municipality has no control over assessments. They also have no say on school taxes, just collect it. The only way they can give relief is from special levies.
Poulin showed different levels of taxes on mock tax bills, explaining the assessments on land and buildings. He also brought up the $700 education property tax credit advance, which was applied against your school tax total. In 2018 was applied against municipal taxes. In 2019, anything above the school taxes will no longer be credited to municipal taxes. Based on 2018 property taxes, it would impact 334 households. If an urban property is worth $75,000, they will see their taxes increase by $305.68. It will have a significant impact on 31% of the municipality. A property would have to be worth $133,195 in order to reach the break-even point, where the impact would not be felt.
Using examples, they showed the difference assessed taxes hit different properties. A property assessed at $67,000, with the education credit on it, would end up paying $486.89 in municipal taxes. However, one assessed at $494,800 would pay $5,857.99. It particularly shows in the special levies. If done strictly by assessment, the lower value property would pay $164.68, while the higher worth property would pay $1,243.83 for the same services. The results are similar for commercial property.
Another issue upcoming is the single mill rate. By 2023, the Province will require all amalgamated municipalities to run one mill rate. As rural properties are worth more, it would be a hit to country ratepayers. If a single mill rate was run today, the urban rate would go down by 10.6% and the rural would go up 16.9%. A factor in making special levy moves is to find a way to make a fairer system between the two former wards.
Poulin showed hypothetical examples of how the special service levy could impact property taxes. For example, a $100,000 property could see an overall increase of $90.65 to taxes, before the impact of the education tax credit changes, which could bring the increase to $265. For a higher assessed residential property, say $300,000, they could see a decrease of $118.09.
“It makes it more fair,” Swanson stated. “As council, we looked at all of these numbers, but we had to be mindful to not be too aggressive and be mindful of the impact the changes (to education tax) would have and not make it worse than it was.”
Swanson said they started with the protective services by-law because it was the easiest. Others would follow, particularly if they have to go to one mill rate. Right now, the rural part of the municipality is paying straight from assessment and paying their fair share. Changes there will have to come in the future.
“It is a difficult process to be fair, because if you went straight by assessment, a small portion of the people in the municipality would be paying for a large portion of the services.”
There were questions from the crowd regarding many of the impacts of the proposed by-law. As this moves some of the burden over to properties with lower assessments, there are concerns it will hit people least able to pay for increases, and that many around the council table would be passing themselves a tax break. One person was concerned that a community she previously lived in started with this type of levy, but moved on to other services, so that were many special levies perhaps impacting smaller properties too much. As well, there was a concern that the changes focused only on assessments, but not on actual usage of services.
Although it was stressed there was still the majority of the levy on assessment as opposed to per parcel, a respondent who lives in a higher assessed property did bring up a hope in the future it would be a fully level playing field – i.e. all on per parcel. The public debate will continue, and close examination of impacts will have to be part of the future.
If passed, the levy will be assessed in five years, but can be done at any time due to assessment changes or any other reason. As well, council is working with other municipalities to try to get the Province to drop the single mill rate concept, which could change the situation in regard to urban-rural special levies in the future.
Once the council passes the first reading of the by-law, which Swanson said could happen at their Thursday meeting, it would go to the Municipal Board for approval. If it were approved, with or without changes, then they would proceed. Attendees had the option of filing a formal objection at the meeting. Swanson said this is just the beginning of the work.
“We’ll see you at more meetings in the future,” she said. “I’m giving you notice.”
by PAUL RAYNER, Recorder staff