UPDATE: On June 1, council passed second and third reading on a bylaw to set the tax ratio at 5:1
A move to reduce Jasper’s commercial/residential tax ratio has Jasper council split.
Introduced during discussion of Jasper’s required tax rate bylaw for 2021, the idea of reducing the tax burden from non-residential properties to the residential sector was floated by councillor Paul Butler, an objective he said he’d been calling for since he was elected in 2017.
“I mention this every year,” Butler said, whose case quickly found support from councillors Helen Kelleher-Empey and Bert Journault.
“Residential taxes are pretty low in Jasper,” Kelleher-Empey stated.
Councillor Scott Wilson was less enthusiastic to make the change. He suggested burdening residents with additional financial hardships during an already uncertain year was inappropriate. He said he’d entertain a discussion for the changes to take place in 2022, but not before.
“This is rash, I don’t support this,” he said.
Part of Butler’s rationale for adjusting the tax split which, historically, has been as high as 7.5:1 but which currently sits at 5.1:1, was to come into compliance with the Municipal Governance Act.
“While it’s clear there’s a loophole allowing non-conforming municipalities to remain as such, the intent of the MGA is clear…I think we should conform to the intent of the MGA,” Butler said.
But the MGA’s legislation is hardly a loophole. A 2017 Order in Council allows non-conforming municipalities to leave their tax ratio higher than 5:1 if they so choose (Maximum Tax Ratio, Section 358.1). However, if the tax ratio is reduced, that lower number becomes the new “cap” thereafter. Mayor Richard Ireland was concerned that there was a suggestion that Jasper was offside of a legal requirement to come into compliance.
“That regulation was designed recognizing the unique circumstances of some municipalities, in a sense grandfathering where people were at,” he said. “We recognize grandfathering in all sorts of legislation.”
Further, Ireland suggested that the 0.1 reduction was negligible and that the bigger question was one of equity.
“There are a raft of issues which I think are primarily in the philosophical governance sphere, not in the administrative sphere,” he said. “I hesitate to think that we can burden administration with numbers which will only distract us from our primary objective, which is to insert what we consider to be an equitable solution.”
Banff, another “non-conforming municipality” when it comes to tax ratios, recently passed a 6.367:1 non-residential/residential tax split. That community has been more willing to adjust its tax rate than Jasper; the ratio was increased from 2020’s 5.9754:1 rate to account for the pandemic’s affect on the assessed value of non-residential properties.
Banff’s Director of Corporate Services, Chris Hughes explained that the MGA legislation for the mill rate split is still working its way through the Instrument of Entrustment process so it is not in force yet for the Town of Banff.
“It should be signed off shortly and when it is, then the process of phasing our mill rate split down to 5:1 would begin,” he said.
Hughes said in the wake of those commercial properties’ lower assessed values, if the town did not bump up the tax split, the tax burden would have fallen heavily on residential property owners.
“The challenge is if we were forced to fix it at 5:1 we would have had massive residential tax increases.”
“We get four million tourists per year and the only ability to collect tax from them are the businesses who benefit from tourism,” Hughes said.
Hughes added that a tax ratio cap gives non-conforming municipalities one less tool to share the burden equally among residents and visitors.
Bob Covey //thejasperlocal@gmail.com
