2023 TAX RATES (Staff Report)

2023 TAX RATES

RECOMMENDATION:

THAT the report dated April 17, 2023, from the Director of Finance titled “2023 Tax Rates” be received.

PURPOSE:

To provide information regarding the 2023 municipal, Capital Regional District and Capital Regional Hospital District tax rates as directed by the Committee of the Whole at its April 11, 2023 meeting.

TIME CRITICAL:

The Community Charter section 197 requires the municipality to adopt a tax rates bylaw after adoption of the financial plan but before May 15 each year. Tax Rates Bylaw No. 1114, 2023 has been prepared for first, second and third readings at the May 2, 2023, Council meeting and for adoption at the May 9, 2023, Special Council meeting to achieve compliance with legislation.

EXECUTIVE SUMMARY:

The proposed 2023 Tax Rates Bylaw No. 1114, 2023 reflects Council’s direction regarding the tax burden for the View Royal property owners based on the respective property assessment class as determined by BC Assessment. The average residential property valued at $1,046,317 in 2023 will see a $200 increase for municipal taxes and a $14 increase for Capital Regional District and Capital Regional Hospital District taxes. Once the bylaw is adopted, the annual property tax notice will be issued to property owners at least four weeks prior to the July 4, 2023, due date.

Tax rate increases for 2023 in other municipalities in the region are not yet available; however, View Royal’s municipal property taxes per capita ranked fourth lowest in the Capital Regional District in 2022.

BACKGROUND:

At its April 11, 2023, meeting, the Committee of the Whole considered several different options for tax rates that would achieve the 2023 revenue target identified in the five-year financial plan. Council directed staff to prepare a bylaw for the 2023 tax rates based on the tax ratios as described in Schedule 1 – Municipal Property Tax Rates and Ratios. Additional comparative information is provided on Schedule 2 - Summary of impact on prior year $100,000 property value and Schedule 3 – Sample property comparatives.

DISCUSSION:

The selected tax rate ratios (see Schedule 1 – Municipal property tax rates and ratios) reflect Council’s objectives to maintain a consistent tax burden for all property classes as described in the 2023-2027 Financial Plan bylaw (Bylaw 1113). Tax ratios for 2023 remain unchanged from 2022 except for the ratio for assessment Class 02 (utilities) which follows a different rate calculation. The addition of assessed values to the tax base through non-market changes (i.e., new construction) results in a slight shift toward the residential and the recreation/non-profit classes, away from the business and light industry classes, as shown below:

Schedule 2 – Summary of impact on prior year $100,000 property value shows that the impact to a residential single-family property is an estimated increase of $18 per $100,000 of 2022 assessed value (adjusted for 2023 market change), and $31 on a residential strata property by the same measure. The average residential property valued at $930,207 in 2022 is valued at $1,046,317 in 2023 and could expect to pay about $200 more for municipal property taxes this year. Schedule 3 – Sample property comparatives provides details on how the proposed tax rates affect selected sample properties.

The proposed 2023 tax rates bylaw includes rates for both the Capital Regional District (CRD) and Capital Regional Hospital District (CRHD), as required by legislation. The tax rates are calculated to collect sufficient revenue to pay the requisitions after adjusting for any prior year over or under levy. The 2023 CRD and CRHD requisitions are as follows, with comparisons to the prior year.