In the May edition of the Regina and District’s Chamber of Commerce newsletter, ChamberLink, the Chamber’s CEO takes aim at a particular City Councillor who has questioned the current split between commercial and residential property taxes in our City. Residential ratepayers contribute about 63% of total tax revenue compared to non-residential (commercial) at 37%. After Saskatoon, this is one of the lowest ratios in Canada. As the Chamber CEO, John Hopkins, writes
This year City Council decided to keep the split the same as it has been for the past 17 years at 63% residential which generates $139 million and 37% non- residential (business) which generates $81 million. However not every member of City Council supports the current split and while it would be premature to push the alarm bell there is at least one City Councillor who is clearly signaling that business should pay more, a lot more. According to him business should be paying 50% of the total $220 million tax levy which would require a $29 million increase (35%) to business and a corresponding $29 million decrease to residential. Fortunately, there does not appear to be a lot of traction with the rest of Council for his agenda at this point but City Council did ask for a report from the City Manager to look at the split.
Mr. Hopkins’ claim is misleading. First, no Councillor advocated for a 50/50 split at budget time. Second, what we’re talking about here is a ratio, not tax increases. During the election, I said that I wanted to see equalization, and to bring Regina in line with other jurisdictions. I stand by that commitment and that’s why I asked City Administration to review the ratio leading up to the 2018 budget. At budget time this might mean that Council considers variable increases, should mill rate adjustments be required. However, none of the Councillors have ever advocated for the type of sharp increases outlined by Mr. Hopkins.
It is also worth noting that Regina’s commercial property tax rates are among the lowest in Canada. Combined with record low provincial corporate tax rates – which were further reduced in the 2017 provincial budget – evidence suggests that Saskatchewan remains a “business friendly” environment. But is this sustainable? Cuts to provincial and civic services suggest that the current tax regime in our province requires some serious reflection. Residents should also know that commercial ratepayers enjoy phased-in tax increases following the recent property assessment adjustments. This policy has radically reduced the number of appeals and awards business owners time to compensation for property tax increases. Although I initially questioned the fairness of this policy, I accept that it makes good economic sense in the long run.
In my conversations with business owners in Ward 3, taxes are rarely mentioned as a point of contention. Sure, no one wants to pay more and an increase should be accompanied by an increase in the quality of services offered. To that point I certainly agree. Business owners typically mention the issues everyone in Regina talks about: parking, roads, infrastructure, and services. They also want City Hall to run efficiently. That means acquiring zoning and other permits in a timely manner, for instance. But most importantly they want and need customers. For many businesses in Ward 3, these needs also include walking traffic, access to public transit, and vibrant communities full of parks, recreational, and community-oriented spaces. These services are paid for through taxes. It also means making Regina a good place to live and work, not just to invest. When the Chamber attends Council meetings and asks for recreational spaces, like public golf courses and lawn bowling greens, to be closed, that does nothing to enhance our community or the business environment.
Over the summer I will be developing a Ward 3 Business Survey and mail-out that enables me to better understand what business owners in our community want from the City. I need to hear directly from people rather than relying on lobby groups to offer this information. What kinds of questions do you think I should ask?
My civic election taxation platform
ChamberLink (May 2017)
RealPAC assessment (if you can't download a copy, email me [email protected])