Napanee Council Proposal to Equalize Rural & Urban Property Taxes - 10 March 2015

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Napanee Council Proposal to Equalize Rural & Urban Property Taxes - 10 March 2015

Post by Admin on Tue Mar 03, 2015 11:39 am

to: Mike Schenck,

Didn't think I'd be contacting you again so soon, but the issue of rural/urban property tax rate equalization has come up within the community and we wanted to pass along our concerns in advance of the motion to be tabled during the council meeting on the 10th. I've taken your advice and asked others in the community to voice their concerns to you directly and some of us are making plans to attend the meeting on the 10th.

The key points we wish to make is that Sandhurst pays somewhere in the neighborhood of $300,000 per year in property taxes. For that we receive the services of our municipal water system, weekly garbage/recycling pickup (partly subsidized by the tag program) and school bus services, law enforcement, snow removal, road and infrastructure maintenance etc. We do not have, nor are we seeking paved streets, curbs, sidewalks, street lights, sewers, drainage, street sweeping, pest control or other services normally available in town. Sandhurst has done its part to reduce costs with the recent closure of the Sandhurst public school while we continue to wait for needed repairs to our own streets.

In considering the merits of a renewed proposal to equalize rural and urban property tax rates, the SSRA consider this motion to be unjustified given that the extra funding sought from rural property owners would benefit only the urban property owners. Specific to Sandhurst, no major expenditures have been allocated to this community since the turn lane was constructed at our main entrance so we do not see ourselves as a significant drain on the municipal tax base. We also fear that any equalization of property tax rates would become a deciding factor for some homeowners to sell and move closer to town because there would no longer be any financial trade-off to the inconvenience and extra costs of living so far out of town. More to the point, property tax parity could become a significant disincentive for prospective home buyers who would otherwise seek out rural properties as being more affordable due in part to lower property taxes. Should this lead to the creation of vacant homes, then property valuations could begin to decline throughout the community ultimately reducing the very property tax base that one councillor seeks to increase.

For budget planning purposes, considering recent cuts by the Provincial government to the municipalities, the only sound financial recourse may be to reduce or eliminate services that are no longer affordable, or conversely, to seek an increase to property taxes from those who stand to benefit from the continuation of those services.
Thanks for considering our points and we look forward to seeing you on the 10th.

Doug Reid
Executive Chair
Sandhurst Shores Ratepayers Association
613 449-2153


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Council Meeting 10 March 2015 - Proposed Equalization of Rural and Urban Property Taxes - Sandhurst Shores Ratepayers Assn Concerns

Post by Admin on Tue Mar 03, 2015 12:18 pm

From: Douglas Reid
To: Mike Schenk
Sent: Tuesday, March 03, 2015 12:04 PM
Subject: Fw: Council Meeting 10 March 2015 - Proposed Equalization of Rural and Urban Property Taxes - Sandhurst Shores Ratepayers Assn Concerns

Hi Mike,

Just following up on my earlier e-mail.

I should have read the article in the Napanee Beaver before sending the SSRA comments regarding the possibility of equalization of rural and urban taxes. I now see that the motion by Mr. Lucas on the 10th is not to equalize tax rates but rather to review the process and the rationale used to set the urban and rural rates. I think this is a good thing and would support that motion.

What was sent to me was a series of e-mail whereby other members of the township had interpreted the article in the Napanee Beaver as an intent by Mr. Lucas to propose equalization of tax rates. That's obviously not the case so please take my e-mail as good starting point for the upcoming discussion on this topic and not necessarily as a negative position with respect to the current proposal from Mr. Lucas.

I promise to do my own independant research in the future.

Thanks again



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Update - Motion to study tax policy

Post by Admin on Wed Mar 04, 2015 3:18 pm

----- Original Message -----
From: Douglas Reid
To: ; Tony Reid ; Ruth and Ed Mackisoc ; rick naylor ; Richard Weigand ; Paul Lafond ; Monica McLeod ; Jan Pettigrew ; Greg Moon ; Doug Hargreaves ; ; dave fasken ; Cissy Fleming ; Byron Collins ; Bill Skelly ; Arthur Dolan ; Andre Campbell
Cc: Jane & Ken Healy
Sent: Wednesday, March 04, 2015 2:55 PM
Subject: Rural and Urban Property Taxes - Motion to Napanee Council 10 March 2015

Hi folks,

One last e-mail to close the loop on this issue prior to the Greater Napanee Council meeting next week.

I recieved a response from Mike concerning the upcoming motion to council from the Ward 5 Councillor to study the tax policy in order to validate rural and urban tax policy. Mike verifies that while the motion proposes to study the tax collection rates and balance of payments made by the municipality, the underlaying intent is to create a one size fits all tax rate for rural and urban property taxes. Mike confirmed that the Councillors from Ward 4 and 5 had worked together several years ago to equalize rates but were defeated so Mike and the other rural councillors see this as just another attempt to create the groundwork necessary to justify a standard rate for property taxes between the rural and urban property owners.

Therefore we will want to see this motion defeated.

Mike obviously did not state how he would vote, but I'm confident that he and the other rural councillors clearly understand the probable consequences if this motion were to succeed and therefore will not let that happen.

I want to acknowledge John for attending the township ratepayers meetings on our behalf where this issue was first addressed and thank him for his efforts to get the word out. My earlier e-mail should not be interpreted as suggesting that John's information was incorrect, in fact I was referring to the original e-mail from the ratepayers meeting, so sorry to John if anyone thought that was the case.


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Napanee Municipal Property Tax Mill Rates

Post by Admin on Fri Mar 13, 2015 2:20 pm

1.    I did a bit of research to provide Sandhurst Ratepayers with a bit of background on their property tax mill rates. The intent with this information is to better understand the rural versus urban tax rate issues. Property taxes are determined as follows:

a.    MPAC sets property values in Ontario. This service is used by the municipalities to calculate property taxes. You can log in to using your Roll Number and Access key listed on your 2013-2016 Property Assessment Notice.

b.    To verify the amounts, I looked at the assessed value of my property listed in my 2014 Tax Bill and then matched that with the value assessed for 2014 according to my MPAC Property Assessment Notice. Both were the same.

c.    Then I reviewed the mill rates. The total mill rate for rural properties is .011524 x your assessed property value. (multiply your assessed value x .011524 = your total 2014 property taxes). . I used this mill rate calculation for my own property and the total equalled my tax bill for 2014. Municipal mill rates in the budget are as follows:

(1)    Operations Urban + .006222
(2)    Operations - Rural Rebate - .001991
(3)    Capitalization Urban + .000413
(4)    Capitalization - Rural Rebate - .000132
(5)    Municipal Urban (total) = .006635
(6)    Municipal Rural (total) = .004512
(7)    L&A County (all) + .004982
(Cool    Education (all) + .002030

d.    Adding these mill rates will produce totals of .013647 x urban and .011524 x rural property tax rates.

c.    The numbers that are most important for our discussion are (5) Municipal Urban (total) @ .006635, less (6) Municipal Rural (total) @ .004512 for a difference of .002123 or equal to a 32% reduction in rural versus urban rates for Municiple Operations and Capitalization. Take note that rural tax payers pay the same mill rates as urban tax payers for the L&A County and Education levies.

2.    The 2014 Budget lists dollar amounts based upon a hypothetical property value of $150,000. Calculating actual mill rates permits deduction of municiple operating and capital rates combined with county and education rates. This allows for a total tax calculation for comparison between urban and rural taxes. I think you'll be surprised by the outcome remembering that the municipal budget portrays urban and rural rates for Operations and Capital at 100% versus 68% respectively and most I believe, interpret this as the complete tax picture. Here are the actual mill rates:

OPERATING BUDGET General Government   0.0018014 0.001225 32.00%
Policing   0.003012 0.0020482 32.00%
Fire and Emergency Services   0.0012153 0.0008264 32.00%
Animal / Bylaw Control   0.0000826 0.0000562 31.96%
Conservation Authority   0.0001063 0.0000723 31.98%
Building Inspection   0.0000835 0.0000568 31.98%
Land Use Planning 0.0001255 0.0000854 31.95%
Roads Maintenance 0.0011313 0.0007693 32.00%
Roads Winter Control 0.0003787 0.0002575 32.00%
Gargage / Recycling 0.000163 0.0001108 32.02%
Parks and Facilities Admin 0.0002807 0.0001909 31.99%
Programs 0.0000166 0.0000113 31.93%
Arena 0.000235 0.0001598 32.00%
Splash Pad 0.0000248 0.0000168 32.26%
Municiple Buildings 0.0002028 0.0001379 32.00%
Parks / Ball Fields 0.000261 0.0001775 31.99%
Economic Development / Tourism 0.0001145 0.0000778 32.05%
Financing Costs 0 0  
Payment in Lieu of Taxes (credit) -0.0006766 -0.0004601 32.00%
Provincial Grants (credit) -0.0013882 -0.000944 32.00%
Other Municiple Revenue (credit) -0.0003842 -0.0002612 32.01%
Transfer from Reserves (credit) -0.0002556 -0.0001738 32.00%
Surplus -0.0003087 -0.0002099 32.01%
CAPITAL BUDGET IT and Web 0.0000419 0.0000285 31.98%
Equipment 0.0000956 0.000065 32.01%
Vehicles 0.0000953 0.0000648 32.00%
Buildings 0.0001524 0.0001037 31.96%
Roads and Bridges 0.0000275 0.0000187 32.00%
Parks and Sports Facilities 0 0  
Economic Development 0 0  
Transfers from Surplus 0 0  
L&A COUNTY LEVY  0.004982 0.004982 0.00%
EDUCATION LEVY  0.00203 0.00203 0.00%
TOTAL TAX RATES 0.0136464 0.0115236 15.56%
ASSESSED HOME VALUE $264,500.00 $3,609.47 $3,047.99 15.56%

3.    So, using an assessed value of $264,500, the real difference between urban and rural total property taxes is 15.56%, not 32% as is commonly stated. We need to remember that the Operations and Capital portions of our tax levy do not represent the total picture. Also to remember is that while the rural tax payers benefit from a 32% rebate under the Operations and Capital Budgets, we also loose 32% assigned under the credit categories listed under the Operations budget. Win some, loose some. Finally, a standard rebate of 32% under all categories would not accurately reflect the services we do or do not recieve. This is where any future review should focus their efforts.

4.    Now we need to look beyond the Operations and Capital Budget rates and concider the larger issue of assessed property values. This, I believe, is the critical issue going foward, not the percieved or actual differences in property tax rates between rural or urban properties. To demonstrate my point, I conducted a simple review of several properties within Sandhurst which produced significant differences in 2016 taxes as follows (the sampling size is limited so the actual results will vary):

 Assessment         Taxes      +/- Avg
LOCATION Richmond $250,000.00 $2,881.00 -4.80%
Clonmere $277,000.00 $3,192.15 5.48%
Clonmere $231,000.00 $2,662.04 -12.03%
Old Orchard $255,000.00 $2,938.62 -2.89%
Old Orchard $219,000.00 $2,523.76 -16.60%
Shore Drive (water view) $315,000.00 $3,630.06 19.95%
Wright Place $224,000.00 $2,581.38 -14.70%
Elmwood (water view) $345,000.00 $3,975.78 31.38%
Meadow Crescent $224,000.00 $2,581.38 -14.70%
Hwy 33 $286,000.00 $3,295.86 8.91%
AVERAGES Average home value / taxes owing 2016 $262,600.00 $3,026.20  

5.    As you can see, anyone with a comparable home in Sandhurst, but with a view of the water, will be assessed a tax increase between 20% to 31% above the community average. You can assume that the water view home being valued at $82,400 above the average home and paying $950 more in property taxes would be worth much less in Napanee where the average tax payment might be $3,480 versus $3,975 actual paid taxes. Similarily, the average home in Sandhurst valued at $262,600 will pay $3,026 versus $3,480 for a comparible home within the Napanee urban zone. In comparison, those homes in Sandhurst paying above the community average, may be paying the same or more than many urban properties valued at or near $262,600. So the discussion for or against a 100% urban/68% rural tax rate is not linked to actual taxes paid in real dollars. I can't access property values in Napanee so I'm unsure of the precentage of residential properties that might be assessed at or below $262,600 in town. Needless to say, in real dollars, a fair percentage of rural homes will be paying more in property taxes than a percentage of residential properties within the urban area. Said another way, everyone in the rural areas do not pay less taxes then everyone in the urban areas. It would be interesting to access that data to calculate these percentages.

6.    The issue of rural/urban tax rates oversimplifies this issue and is creating inappropriate perceptions of fairness or even of the key issues at hand. I also think that a fair share of hyperbole was used last night to inflame opinions one way or another. Does a waterview property in Sandhurst gain 31% more in municiple services than the average home in Sandhurst? Does an above average home in Sandhurst use more or less the same services as a below average priced home in Napanee? Obviously these questions have no answers and are as irrevallent to the discussion as the 100%/68% discussion so we need to drill into the numbers, analyze services provided and validate tax assessments against a common model versus arbitrary assessments of property values.

Hope this generates some thought on the issue and may prove useful in the future when this issue arises once again.



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Re: Napanee Council Proposal to Equalize Rural & Urban Property Taxes - 10 March 2015

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