Staff Report - 2025-2034 Permissive Tax Exemptions Bylaw No. 1149

2025-2034 PERMISSIVE TAX EXEMPTIONS BYLAW NO. 1149

RECOMMENDATION:

THAT the report dated September 26, 2024, from the Director of Finance and Technology titled “2025-2034 Permissive Tax Exemptions Bylaw No. 1149” be received.

ALTERNATIVE OPTIONS:

Option #2: THAT Council amend the duration or percentage of exemption for one, some, or all permissive exemption applications.

PURPOSE:

To consider Tax Exemption Bylaw (Places of Worship and Community Halls) No. 1149, 2024.

BACKGROUND:

On September 10, 2024, the Committee of the Whole resolved

THAT the Committee recommend that Council consider applications for permissive tax exemptions for a ten-year term and direct that a permissive tax exemption bylaw be prepared for consideration prior to the October 31, 2024 deadline.

The proposed Tax Exemption Bylaw (Places of Worship and Community Halls) No. 1149, 2024, (Attachment A) provides permissive tax exemptions as recommended by the Committee.

Section 224 of the Community Charter allows the Town to provide property tax exemptions to non-profit or charitable organizations that provide services which Council considers directly related to the purposes of the organization. It also allows permissive exemptions for some properties in addition to statutory exemptions, such as church halls or land surrounding places of public worship. Permissive exemptions under Section 224 are at the discretion of Council and there is no obligation to give the exemption.

ANALYSIS:

The Committee considered three applications for tax exemptions from charitable or non-profit organizations. All applications pertained to properties that were previously tax exempt for a ten-year term expiring in 2024 (Tax Exemption Bylaw (Community Halls) No. 904, 2014 and Tax Exemption Bylaw (Church Halls and Church Land) No. 905, 2014). Attachment B attached to this report comprises the three exemption applications as submitted:

1. 287 Pallisier Avenue; Folio 401 04412.018; Redeemed Christian Church of God – Victory Chapel: The church and land on which the church sits are statutorily exempt under Section 220 of the Community Charter. While a portion of the main building is leased to a daycare, the lessee has applied and, being a non-profit organization, is eligible for exemption. Thus, eligible for permissive exemption are:

   • the area of land surrounding the exempt building,
   • the hall as considered necessary to the exempt building and the land on which the hall stands, and the area of land surrounding the hall

2. 279 Island Highway; Folio 401 04399.010; View Royal Ratepayers and Community Association: The upper level of the building is rented for private and public events, aligning with the Association’s vision to support an inclusive community for all View Royal residents, and to provide a venue for people to gather to strengthen their sense of community. The lower level of the building is leased to a for-profit childcare organization. While the Community Charter prohibits assistance to a business, the daycare does not have exclusive use of the space and operates under a model which charges below-market rates for childcare, furthering the purposes of the Association.

3. 11 High Street; Folio 401 07647.010; Strawberry Vale and District Community Club The property provides the community the opportunity to participate in sports and educational activities as well as social activities. The building is available for rent to community groups and individuals.

The ten-year duration of the permissive exemption bylaw provides financial predictability to the Town, while giving the exempt organizations a level of financial predictability and stability over the coming years. The bylaw also allows that if the use of any portion of the property changes during the ten-year term and is subsequently deemed to be for profit, the tax exemption would cease to apply to that part of the property.

Impacts and implications can be summarized as follows:

Community Impact: Provides cultural, recreational, or educational programs for the public and community groups, which promote community spirit, cohesiveness and tolerance.

Financial Implication: Permissive tax exemptions reduce the property taxes payable by the grantee organization for the term of the exemption. The amount of tax revenue exempted is shifted and spread to all other taxpayers in View Royal. The Schedule of Permissive Tax Exemption Applications 2024 (Attachment C) estimates the annual value of tax exemptions will be between $53,800 and $60,500 for the years 2025 to 2027, including property taxes for municipal and all other purposes (school, regional district, hospital, etc.).

Inter-governmental Relations Impact: Permissive tax exemptions will shift property taxes for other taxing authorities from the exempted properties to all other taxpayers, in the same manner it does for municipal property taxes.

ALIGNMENT:

The recommended option aligns with the Town’s following core guiding documents as follows:

Strategic Plan: The Town recognizes that there are organizations in the community which enhance the quality of life with their program and service offerings. Providing permissive tax exemptions aligns with the following Strategic Priorities of Council:

• Enhance Livability
• Financial Sustainability and Service Excellence

Official Community Plan: N/A

Other Policy Documents: N/A

PUBLIC PARTICIPATION GOAL:

The desired level of public participation for the recommended option is:

☐ Inform ☐ Consult ☐ Involve ☐ Collaborate ☐ Empower ☒ N/A

TIME CRITICAL:

Section 224(4) of the Community Charter requires permissive property tax exemption bylaws be adopted by October 31 to be in effect for the next calendar year. Sections 227 and 94 require public notification to occur in the manner set out by the Town’s Public Notification Bylaw No. 1106, 2023. Staff will return Tax Exemption Bylaw (Places of Worship and Community Halls) No. 1149, 2024 for Council’s consideration after public notification is completed and before the October 31 deadline.

ATTACHMENTS:

Attachment A: Proposed Tax Exemption Bylaw (Places of Worship and Community Halls) No. 1149, 2024 Attachment B: 2024 Permissive Tax Exemption Applications Attachment C: Schedule of 2024-2034 Permissive Tax Exemption Applications