The partial closure of Howe Sound Pulp and Paper (HSPP) will result in a loss of nearly $200,000 from major industry taxation in 2016, upping taxes for homeowners across the Coast.
Sunshine Coast Regional District (SCRD) directors were told of the anticipated impacts at a Dec. 17 corporate and administrative services committee meeting.
Staff said BC Assessment told them in August it was “unlikely the 2016 assessment roll would be impacted” by the closure of HSPP’s paper mill in Port Mellon.
However, HSPP had until Nov. 30 to apply for a “closure allowance,” which would provide assessment relief. On Nov. 25, the SCRD was notified that HSPP had successfully filed the documents needed.
A closure allowance reduces the improvement value of a facility to 10 per cent of the cost. In other words, depreciation is increased to 90 per cent.
The depreciation in value impacts the amount of taxes that can be levied, and the result for the SCRD is an estimated loss of $197,061 in major industry taxation from HSPP next year.
“Howe Sound Pulp and Paper, even though it is located in Area F, affects the whole entire Sunshine Coast because they pay toward services that are regionally funded. So the $197,061 is the regional impact to the change in assistance,” said treasurer Tina Perrault, noting the figure is a best guess because “we won’t receive the final roll numbers until early January.”
The taxation garnered from HSPP partially funds 30 different functions throughout the SCRD. The two biggest functions that will be hit by the decrease in taxation are recreation (estimated loss of $88,250) and community parks (estimated loss of $20,075).
Communities pay differing amounts into SCRD functions, so the possible increase in taxes varies widely between areas.
A taxation summary prepared by staff showed that residential homes worth $400,000 on the Coast are expected to pay additional taxes ranging from $4.23 in Pender Harbour to $15.94 in West Howe Sound to cover the loss.
“I notice that it’s Area F that’s got the largest impact,” said Area F (West Howe Sound) director Ian Winn.
“There are 30 functions in there that are impacted by this change, and I know I’ve asked the question before about how did we get into all these different functions – what is the history, how did all that happen? I just need at some point to understand all of the functions that not only Area F major industry contributes to, but broader than that,” Winn said.
Staff pointed Winn to the 2016 “budget binder” and Winn said he would start there before talking more with staff. He noted a motion for more information might be forthcoming in 2016.
Directors then accepted staff’s report for information, expecting another report with actual costs to come to the board in the new year.
The entire staff report can be viewed as part of the Dec. 17 corporate and administrative services committee meeting agenda (pages 22 to 26) at www.scrd.ca
