This Tuesday, March 29, 2016, Regina City Council is set to vote on a number of Property Tax Exemptions, as happens every year around this time. Upon review of the proposed exemptions, there are many questions that come up every year, and this year is no different. The theme that I am looking at this year, being an election year, is the concept of providing fair and equitable treatment to all taxpayers of Regina. Are these Property Tax Exemptions going to those parties that truly need them? Are there parties out there that could really use them but aren't being offered them because they simply don't know they are eligible? Is there a better way to handle this going forward?
This and more to be addressed starting at 5:30PM Tuesday at City Hall! Be there or...tune into my blog for more!
Here are my delegations for that evening. I have also provided a PDF of each for you to download if you are so inclined.
Boundary
Alteration – 2016 Property Tax Exemptions
Good evening ladies and gentlemen, my name is Chad Novak,
and I am here representing the Saskatchewan Taxpayers Advocacy Group, which is
a grassroots organization proudly standing up for the rights of individual
taxpayers. The first item I would like to address this evening is the 2016
Property Tax Exemptions for properties that were included in the approved
November 2013 Boundary Alterations.
A common theme you’re going to hear from me this evening is
the concept of providing fair and equitable treatment of all taxpayers of Regina. To that extent, I feel strongly that the
overall concept of tax exemptions for properties brought into City boundaries
is fair to an extent, as it can be quite a jump in property taxes going from an
RM to a City the size of Regina. With that said, the question becomes just how
much is fair, for how long, and should
it make a difference if the property owner did
not want to be annexed versus those that had explicitly requested to be annexed.
Based on my research, the general consensus is the exemption
amount and the time contained within this framework is more than fair, where
the amount and length of exemption is dependent upon the anticipated timeline
of when the affected lands may be used for City purposes rather than RM purposes.
However, there is serious concern amongst taxpayers regarding property owners
that specifically requested to be annexed versus those that were annexed
against their wishes, as well as differentiating between commercial and
residential property owners. Also, and we can’t stress this enough, the ability
to pay should be a major factor, and like is policy for other city services, it
is felt that any affected property owners should have to demonstrate that the
additional property taxes will cause “unreasonable financial hardship”
as a result of the annexation. And, in fact, this clause was included within
this very policy as you will see in Appendix A. We would be remiss to not
mention the fact that, according to real estate experts, the mere act of
annexation immediately increases the affected property’s value because of the
fact they are now within City jurisdiction and have access to City services. Keeping
this in mind, it is a fact that a major property owner East of Tower Road very
quickly flipped some of their affected lands to the Province for the Regina
Bypass and to the City for the Pacers Ball Park relocation for upwards of 10x
the value immediately prior to annexation. This was with absolutely no
improvement by that property owner.
Further on the concept of “unreasonable financial hardship”, it seems only reasonable that a
homeowner who has lived in the RM for decades should be considered moreso for
relief from the additional property tax versus, say, a giant multimillion dollar
corporation who explicitly requested to be annexed into the City for undisclosed
reasons, who ought to have anticipated and budgeted for the additional property
taxes. A reasonable person would argue that they most certainly have the ability to afford the higher
taxes, even before taking into account the financial benefits that is realized
because of that annexation. As you can see in Appendix B, one of these
companies, publicly traded AGT Foods on East Primrose Drive, which is amongst a
group of companies associated with Alliance Pulse Processors, Long Lake
Investment Inc. and Nutrasun Foods Ltd., is set to receive over $80,000 in
property tax exemption this year alone. When factored over the anticipated 15
year life span of this exemption, barring any further extensions, that translates
to over $1.2M in lost property taxes to the City of Regina and in turn, its
residents. For a company with annual revenues nearing two billion dollars, as
outlined in Appendix C, I would hardly consider them to have realized any “unreasonable financial hardship” due to
annexation.
It is also important to note that the aforementioned
properties were never previously included in any long-term (25 year) Official Community
Plans prior to 2013. The question that a reasonable person would have to ask is
– why then were these lands annexed and why did we not stick to the 25 year
plans as previously designed up to 2011?
Thank you for your time this evening, and I will gladly
answer any questions you may have.
2016 Annual
Property Tax Exemptions
Good evening ladies and gentlemen, my name is Chad Novak,
and I am here representing the Saskatchewan
Taxpayers Advocacy Group, which is a grassroots organization proudly
standing up for the rights of individual taxpayers. I am here to address the 2016
Annual Property Tax Exemptions.
As I said before, a common theme you’re going to hear from
me this evening is the concept of providing fair and equitable treatment of
all taxpayers in Regina. To that extent, I feel strongly that the entire
listing of annual property tax exemptions, and
more specifically the policy behind it, needs to have a thorough review and
a complete overhaul. A quick review of the list of properties subject to
exemption will show you what I mean. There are some sporting organizations receiving
tax exemptions, where others are not.
There are some cultural organizations on the list, where others are not. There are some non-profit organizations on
the list, where others are not. To
me, this suggests one of two things – either the treatment of all applicable
groups is not being applied fairly, or more likely, not all organizations that may be eligible for a tax exemption are aware that they could apply and be
granted an exemption.
Tonight, we’ve seen a prime example of this with the Saskatchewan Multicultural Centre
Association. Their worthwhile cultural organization has paid property taxes
for decades, and now, only when they are in financial dire straits, they have
applied for an exemption. At first Administration recommended denial, but thankfully
the Finance and Administration Committee not only saw this as a fair request,
but also recommended approval of the exemption request for at least three
years. With regards to their specific situation, I would personally like to see
the City of Regina provide a rebate to their organization for the property
taxes they’ve paid over the past 25 years, as a goodwill gesture. I am
confident that this would be a welcome financial boost to their group, and by
the taxpayers of Regina, since they unfortunately lost a significant portion of
their annual funding because of a short-sighted action by our Provincial Government.
We desperately need a complete overhaul of our policies for
property tax exemptions, so there isn’t any further confusion by community
groups as to their qualification for such exemptions. Most importantly, we need to implement a clear policy on
charitable and non-profit organizations, since one does not currently exist
(See Appendix A). Further to this, we also need to implement an “ability to pay”
clause into these exemptions, because as we’ve seen in recent years, there are
organizations receiving continued property tax exemptions simply because
“that’s what they’ve received in the past” – even though their financial circumstances had changed significantly
from when they first applied for the exemption. One glaring recent example
of this was the Saskatchewan Roughriders, who in the 1990’s most certainly
needed a hand up from anywhere they could get it. However, in recent years,
their financial situation had significantly improved which called this
exemption into question, and rightfully, it was finally removed. The same can
be said for other organizations like the Cornwall Centre for their parkade, or
the Regina Airport Authority (RAA). What I find interesting about the RAA is,
based on the current formula (See Appendix B), when it comes time to determine
their property tax exemption, it would appear that the more financially
successful they are, the higher their property tax exemption actually is. This
seems almost counter intuitive, at least on the ability to pay premise.
On the concept of
fair and equitable treatment of all community groups, I can’t help but question
the exemption for the Regina Trades and Skills Centre (RTSC). Granted, they
provide assistance for certain trades, similar to how Sask Polytechnic might,
but I don’t think they are an accredited educational facility. Not to take
anything away from their ability to help the construction industry, but they
are nothing more than a glorified training room at a construction company as
shown by their “Who We Are” section of their website, as shown in Appendix C. Their
organization is quite similar, in fact, to the Saskatchewan Indian Institute of Technology Career Centre, which
operates just down the street from the RTSC. As far as I’ve found through my
research, they do not receive any sort of tax exemption. My question for you
is, why is this, and what
can we do to level the playing field for all groups?
Finally this evening, in a situation that appears to have attempted to level the playing field for
a particular group, let’s take a look at the Caledonian Curling Club’s tax
exemption. I note that the original reason they were granted a property tax exemption,
as shown in Appendix D, was actually to pay for a 99 year lease that the City
of Regina entered with them in exchange for the use of their facility as a
clubhouse for the Craig Golf Course - a golf course which is no longer in
operation, and the future of which is subject to review by your
organization. That said, I can’t help but wonder, why then are we still giving
them a tax exemption? What’s even more bizarre is that, to be “fair”, other
curling clubs in the City applied for, and continue to receive, a similar property
tax exemption. I think the taxpayers of Regina deserve to know why these clubs
receive tax exemptions when there are other groups that can barely make ends
meet year over year and could desperately use these kinds of exemptions and
financial assistance.
Thank you for your time this evening, and I will gladly
answer any questions you may have.
Regina Property
Tax Exemption Review
Good evening ladies and gentlemen, my name is Chad Novak,
and I am here representing the Saskatchewan Taxpayers Advocacy Group, which is
a grassroots organization proudly standing up for the rights of individual
taxpayers. I am here to address the Regina Property Tax Exemption Review.
Once again, I am working hard to ensure our City provides
fair and equitable treatment of all taxpayers in Regina. To that extent, I must
say that I am very pleased to see this report not only being initiated by City
Council, but also being reviewed in detail by your Administration and brought
back for a full public review. With that said, I think we need to take it to the next step and develop a consistent policy to
ensure that there are minimal questions and confusion behind what groups
can qualify and how they can become aware of their ability to apply.
If I am reading this correctly, according to this report,
there are a total of approximately $6.5
Million in property tax exemptions from 2015, with $3.7M of that being the
City’s share. Is this accurate? The question that taxpayers want answered is, is this a reasonable amount? To answer
that, there are many variables that would need to be looked at, but to me, the
more important question to ask is, how
much of this is truly necessary, as every dollar that we exempt, we must make
up elsewhere, which is often in the form of additional property taxes to
residents who are already taxed to death.
When I look at this report, the one item that really jumps
out at me is the $2.8M for the Housing
Incentive Policy in 2015, spread across 569 accounts. While I applaud you
for taking steps to encourage rental housing development, this number is just
outrageous and unfortunately, many of these properties are not tied to truly
“affordable” housing. I know it is your hope
that increasing the supply will cause the market to adjust accordingly, but handing out millions of dollars in tax
incentives to an industry that is hardly “just scraping by”, to me is just a
slap in the face to the individual property owners in our great City that
desperately need truly affordable housing in our community. There are so
many people that can barely scrape enough together to put food on their table,
let alone pay their property taxes or rents. I’m sure the residents of Regina
would love to have that $2.8M put towards even a fraction of their annual
property taxes being exempted, which to me would have a far more reaching
impact on our cost of living and housing supply than anything.
It is also very important to note that the original intent
of the Housing Incentive Policy (See
Appendix A) is very commendable, which talks about encouraging development
within existing communities. What it appears has happened, though, by the reviewing
the list of affected properties, is that this
is now expanded to any development
anywhere in the City (See Appendix B). This goes against the original
intent of the policy altogether, as it doesn’t do anything to encourage infill
development or reduce urban sprawl.
Further into this report, there is a specific property tax
exemption that Economic Development Regina is now apparently in charge of, and
that’s for Economic Development
Incentives. I understand that the authority for this tax exemption has been
delegated, but do you have a current copy of the criteria required to be met,
to get this exemption? The reason I ask is that it seems rather subjective, and
given there is only one account taking
advantage of this incentive, I have to wonder why more aren’t being
granted and what justifications are being used. I recall there being some sort
of complex matrix the last time I reviewed this issue, but I’m wondering if
that’s still being used.
Thank you for your time this evening, and I will gladly
answer any questions you may have.
ACTUAL PHOTOS OF PROPERTIES RECEIVING TAX EXEMPTIONS:
No comments:
Post a Comment