Despite District of Squamish (DOS) council's goal to wrap up budget discussions and determine the 2011 tax rate bylaw at Tuesday's (April 13) Committee of the Whole, unanswered questions and time constraints made such decisions impossible.
Nonetheless, it appears council is leaning in the same direction as last year - reducing tax rates for businesses and light industrial and letting residential taxpayers take up the slack.
Joanne Greenless, DOS financial services general manager, presented the recommended tax rates.
"Council can decide whether these assignments of burden are appropriate," she said.
"The only changes are caps (established by the Province) on utilities and major industry ports, taken as offset to residential."
Coun. Patricia Heintzman expressed concern about what she perceived as the heavy burden on farm properties. Squamish's farm tax rate is 107.09, substantially more than the B.C. average of 25.1.
"I know we don't have a lot of farms in town, but I want to encourage them and at this rate, who's going to start a farm?" she said.
Greenlees said it was important to look at the amount the property owners are actually paying. There are just two small farm properties in Squamish and in 2011 the owners will pay $801 (whereas the average residential property will pay $1,517).
"I think we need to stay focused on the result of the mill rate, not the mill rate itself," she said.
Mayor Greg Gardner argued that people inquiring about whether to establish a farm would likely look at the mill rate, and if someone wanted to start a massive farm, he or she would be deterred.
Coun. Corinne Lonsdale said a lot of thought went into raising that mill rate and it's necessary to dissuade property owners from abusing the system by classifying a residential property as farmland by buying some chickens.
However, the B.C. Assessment Act has several stringent specifications to classify a property as farmland such as a minimum gross annual value of $10,000 if the total land area is less than 8,000 square metres.
Coun. Paul Lalli was concerned about the business tax rate and said comparing Squamish's 10.5 rate to the B.C. average of 10.9 was not the most accurate reflection of where Squamish wants to be.
He shared the same concern about light industrial - the Squamish light industrial tax rate is 17.4 and the B.C. average is 14.9.
"When it comes to industrial and business, I want to know who we are competing with," said Lalli, adding that he would prefer to see the finance committee take a close look at comparable communities and their mill rates.
Coun. Rob Kirkham was particularly concerned about light industry.
"I want to zero in on light industry," he said. "It's a clean, good industry with good paying jobs and we are out of whack with the B.C. average - so if we're looking at attracting light industry, we need to lower that mill rate."
Gardner agreed with Kirkham, saying he wanted to at least be in line with the rest of B.C. but wanted to know the impact on residential.
Greenless said a one per cent shift of the tax burden from light industrial to residential would increase the average residential property tax by $25 and reduce the average light industrial property tax by $2,600.
According to Greenless, there are currently only 72 light industrial properties in Squamish.
Gardner also wanted to lower business tax rates and eventually wants "to shoot for a 2.5 to 1 ratio."
Greenless said a one per cent shift of the tax burden from business to residential would increase the average residential tax by $25 and reduce the average business property tax by $203.
Lalli wanted more information on the amount of light industrial land available and Gardner asked Greenlees to estimate the impacts of reducing light industrial to 15, business to 9.6 and forestry and farm properties to the B.C. average.
Council will continue the discussion at the Committee of the Whole meeting on Tuesday (April 19).
Contingency budget reduced by $60,000
The one resolution that did go through was council's decision to reduce the contingency fund from $160,000 to $100,000 - a move that put Coun. Doug Race on edge in a year when staff had purposely left no "wiggle room" in the budget.
In 2010, council allocated $160,000 to the contingency fund and spent nothing, so Lonsdale was convinced there should be a much smaller amount, if any.
She reminded council that in past years, before all community enhancement grants were presented at one time, the contingency amount usually went to those grants.
With community enhancement grants now being part of the budget, she explained, the reasoning for such a high contingency isn't there.
Lonsdale made a motion to allocate $75,000 to the contingency budget and Lalli seconded the motion.
Heintzman supported a smaller amount, but suggested an amendment to $100,000 was more reasonable. The amendment was carried with Race and Lonsdale opposed, and the motion was carried with Gardner and Race opposed.
Tax exemptions questioned
Council members also discussed the 17 tax exemptions they decided to grant in October 2010. According to staff at the time, tax exemptions are normally granted to groups that fall under the category of land and improvements held by charitable, philanthropic and not-for-profit organizations.
Those types of so-called "permissive tax exemptions" are entirely at the council's discretion.
That includes two municipally owned properties - the Oceanfront and the Adventure Centre lands - and 15 others, including Vancouver Coastal Health, the Squamish Yacht Club, Squamish Valley Golf Club, the B.C. Lions Society, Howe Sound Women's Centre and several others.
The two municipally owned properties to receive tax exemption would generate $257,248 in property tax revenue and the 15 other tax exemptions would result in $224,703 in property tax revenue.
Gardner highlighted the potential impact of exempting so much revenue.
"If we didn't give these tax exemptions, it would result in a one per cent tax deduction overall," he pointed out.
When council made the decision to approve the tax exemption in October, it did so with hesitation and asked staff to recommend a policy with regard to tax exemption and community enhancement grants.
This year's tax exemption discussion is slated to take place earlier in the year.
"I hope this year we can actually give the subject the time it deserves," Lonsdale said.
