Staff Report: 2021 Tax Rates

2021 Tax Rates

RECOMMENDATION:

THAT the report dated April 27, 2021 from the Director of Finance titled “2021 Tax Rates” be received.

CHIEF ADMINISTRATIVE OFFICER’S COMMENTS:

I concur with the recommendation.

PURPOSE OF REPORT:

To provide information regarding the 2021 municipal, Capital Regional District and Capital Regional Hospital District tax rates as directed by the Committee of the Whole at its April 13, 2021 meeting.

TIME CRITICAL:

Legislation 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. 1072, 2021 has been prepared for first, second and third readings at the May 4, 2021 Council meeting and for adoption at the May 11, 2021 Special Council meeting.

BACKGROUND:

At its April 13, 2021 meeting, the Committee of the Whole considered six different options for tax rates that would achieve the 2021 revenue target identified in the five-year financial plan. Council directed staff to prepare a bylaw for the 2021 tax rates based on the tax ratios as described in Schedule 1 – 2021 Municipal Property Tax Rates and Ratios.

Additional comparative information is provided on Schedule 2 - Summary of impact on $100,000 assessed value (2020) and Schedule 3 - Sample property comparatives.

DISCUSSION:

The selected tax rate ratios (see Schedule 1) reflect Council’s objectives for both affordability and consistency in taxation as described in the 2021-2025 Financial Plan bylaw (Bylaw 1071). The increase to the business class multiple from 3.55 to 3.69 is in response to the decrease in assessments in that class and moderates the shift of the tax burden to the residential property class. The increase to the recreation/non-profit property class from 4.73 to 5.10 further moderates this shift and is in keeping with Council’s strategic direction to gradually increase the tax burden for this property class.

Schedule 2 shows that the impact to a residential single-family property is an estimated increase of $17 per $100,000 of 2020 assessed value, and $9 on a residential strata property by the same measure. The average residential property valued at $753,600 in 2021 could expect to pay about $97 more for municipal property taxes this year. Schedule 3 provides further sample property comparatives.

The proposed 2021 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 2021 CRD and CRHD requisitions are as follows, with comparisons to the prior year.

	2021 Requisition	2020 Requisition	Change
Capital Regional District	969,798	962,126	0.8%
Capital Regional Hospital District	662,784	710,499	-7.2%

Taxpayers will experience changes in tax rates differently to the extent that the change in their property assessed value differs from the average change in total assessments.

Note that while information is provided for subsets of assessments within the residential class (single family, strata), legislation allows only one rate for the residential property class.

The 2020 tax rates bylaw allowed an alternative tax scheme in which the tax due date was September 30, 2020 in response to the impacts of the COVID-19 global pandemic. The proposed tax rates bylaw returns the tax due date to the pre-pandemic or “normal” scheme, meaning that taxes will be due midnight, Friday, July 2, 2021. The legislated penalty of 10% on all unpaid taxes, including unclaimed homeowner grants will be applied on any balance owing after this time.