Higher than anticipated assessments for property in Sylvan Lake resulted in a break for taxpayers who won’t have to pay quite as much as was predicted during council budget deliberations in December.
Taxpayers will still be paying based on a higher rate, but the municipal tax rate will increase by 1.9 per cent instead of the 2.4 per cent planned, after councillors approved first reading of a bylaw setting the rates at Monday night’s meeting.
Councillors have control over the municipal tax rate but have no control over the education tax which is set and requisitioned by the province.
New construction bolstered the town’s assessment base increasing it more than was predicted.
Darren Moore, the town’s director of finance, reported there was a net increase of $39.2 million in taxable assessment in 2013. During budget deliberations the net increase was projected at $26 million.
The difference meant that if councillors continued on the path of imposing a 2.4 per cent increase to municipal tax rates they would collect $75,000 over what is required to fund the 2013 budget.
Moore proposed three scenarios for council consideration.
The first was to continue with the 2.4 per cent. The second was to increase rates by 1.9 per cent instead and only collect what was needed to cover the budget. The third option was to increase the residential rates by 2.4 per cent but leave the non-residential rates unchanged from 2012.
Complicating the discussion was the fact that the province has increased the amount it wants to fund education by 2.5 per cent or $137,791. The increase will primarily affect non-residential properties, Moore stated.
As a result, the school portion of the tax bill for commercial and industrial (non-residential) properties is increasing by just over 20 per cent (from 3.553 to 4.274) while the school portion of the tax bill for residential properties decreased marginally by three per cent (from 2.691 to 2.608).
Education taxes make up about 30 per cent of the total property tax bill which owners receive.
Based on the option chosen by councillors, a chart of sample properties in Sylvan Lake indicated that a commercial downtown property will pay $389.02 (2.7 per cent) more for a total bill of $14,558.33. (It’s 2012 assessment of $1,033,050 had seen an decrease in assessment in 2013 to $995,510).
The highway commercial sample indicated an increase in taxes of $607.50 (2.6 per cent) to $23,489.36 on an assessment of $1,606,220.
Assessments remained relatively static for the samples in Fox Run and Lakeview where the total tax increase amounts to about 0.1 per cent while in Hewlett Park assessments climbed and the total tax bill increase is 2.51 per cent higher on the sample property.
If councillors had chosen the option which left the commercial rate unchanged, those sample properties listed above would have seen increases of 1.46 and 1.37 per cent respectively while the Hewlett Park property’s increase would have been 2.91 per cent.
The bylaw will be back at the next council meeting for consideration of second and third reading.
Tax and assessment notices will be mailed May 31 and are due by July 31.
Prior to discussing tax rates, councillors were asked to put the 2012 surplus of $194,000 into the “unrestricted accumulated surplus” for future use.
They eventually agreed but not before Councillor Rick Grimson asked, “why not just return it to the taxpayers, reduce the (2013) levy by $194,000?”
“I’m not adverse to the idea, we’ve taken the money from people who pay taxes,” said Councillor Laverne Asselstine. But then he suggested it be allocated to a specific reserve fund such as the fire hall so they won’t have to borrow as much when it’s time to construct that building later this year.
“Any monies spent are not frivolous,” argued Mayor Susan Samson. “They’re debated around this table. All seven of us are well versed, backed up by staff, to make decisions like that,” she said speaking against returning money to taxpayers.
At the last meeting, Samson reminded them, they took $25,000 from that surplus to top up the budget for the tourism strategy. There was also a request from Sylvan Lake Management Committee for money for educational signage on the threat of mussels to the lake, and they’d just contributed $2,000 towards creating an Urgent Care business plan. Council has also discussed how important it is to attend the RCMP Regimental Ball. “All these require money. To tie our hands and not have any money for emergent topics is not good business.”
Asselstine asked how much money is already in the unrestricted reserve and was told about $2 million.
That’s not a lot for a town the size of Sylvan, stated Councillor Ken MacVicar. “I don’t have a problem with the $194,000 but I do with the next item, $75,000; bringing in $75,000 more than is needed is wrong-headed. We shouldn’t be taking money out of taxpayers’ pockets to put in our piggy bank.”
The motion to put the money into the unrestricted accumulated surplus was passed with Asselstine and Grimson opposed.