Councillors in Gibsons are moving ahead with five per cent increases in water and sewer fees and parcel taxes after starting work on the 2019 budget during a Feb. 5 committee of the whole meeting.
The Town has been consistently raising those fees as part of a plan to renew water and sewer infrastructure and build up reserves for the future.
“We’re not anywhere near recovering our cost of operating those systems… I think we need to, in a modest way, progress towards being able to operate the system with proper due diligence,” said Coun. David Croal.
Coun. Aleria Ladwig voted in favour, but also raised concerns about the impact on the overall cost of living in Gibsons and said she’d like to see a detailed comparison of taxes and fees across the Sunshine Coast.
“During the campaign a number of people would say to me it’s so much more expensive to live in Gibsons than the SCRD… It’s good for all of us to understand at the end of the day, when the rubber hits the road and people are paying this out of their own pocket, how much are they paying to live on our town versus another one.”
The committee also discussed, but didn’t make any recommendations on, the differential between residential and business/commercial tax rates, known as a multiplier.
The discussion was prompted, in part, by a letter from a local realtor that claimed “the current tax burden placed on our business community is onerous and considerably higher than the provincial average. The Town of Gibsons is in danger of losing small businesses and they need all the help we can give them.”
The business tax rate in Gibsons is 3.29 times higher than the residential rate. The current multiplier in Sechelt is 2.27.
Director of finance Dave Douglas said despite the large difference in the multiplier between Gibsons and Sechelt, the actual tax rate per $1,000 in assessed value on business and commercial properties is much closer, with Gibsons just eight cents higher.
The difference in multipliers was created by Gibsons’ lower residential rate, Douglas explained. “Our residential tax rate is quite a bit lower than the Sechelt residential tax rate … because our assessments have gone up hugely over the last three years.”
Coun. Stafford Lumley, the only current councillor what was involved in setting the 2018 budget, said his concerns on the business tax differential led him to vote against the financial plan last year.
Mayor Bill Beamish advised council to hold off consideration of a “tax shift” to reduce the multiplier until after the capital budget has been presented so they have a fuller picture of the financial plan.
Douglas’s written report on the operating budget for 2019 noted the Town is already anticipating an increase in revenue, including roughly $30,500 from new construction and development coming onto the tax rolls. The Town is also expecting to have $138,226 more in rental income in 2019 from its building on South Fletcher Road, the marina, RCMP building and the Arts Building.
Douglas told the committee that the current draft of the budget predicts a deficit of around $50,000 and he gave the committee examples of two possible tax increase scenarios – three per cent and five per cent.
According to Douglas’s calculations, a five per cent increase would raise the Town portion of the taxes on a home assessed at $586,000 by $48.58. The proposed increase in water and sewer parcel taxes would add $28.91.
For a commercial property assessed at $958,000 the impact of a five per cent increase would be about $261. The water and sewer parcel tax increases would be the same as a residential lot.
The committee did not make any recommendations on overall tax increases.
Council’s next budget meeting, which will break down the proposed spending on capital projects, is scheduled for March 12.
