New policy would cap tax exemptions

Parksville city council continues a years-long process developing policy for which community groups should get tax exemptions

Parksville staff returned a report on a new permissive taxation policy proposed by council’s advisory committee which would introduce a cap in the total value of exemptions granted. Committee chair, councillor Al Greir presented the updated policy at council’s April 15 regular meeting but as the questions mounted council decided to send it to staff to review.

With a wide range of possibilities, Mayor Chris Burger asked for feedback from councillors on their big-picture hopes for the permissive taxation program.

“I’d like to see the cap done away with and just have tighter restrictions,” said Coun. Peter Morrison, agreeing with the report that a cap would make it too complicated.

“We have to make sure that the organizations that are affected by what ever type of eligibility we put down on paper doesn’t impact on the good work they do, because this is all about the underprivileged for most cases,” said Coun. Marc Lefebvre. “I’m thinking of the Salvation Army, I’m thinking of the Society of Organized Services —  what would the impact be if we cut them back by 25 per cent or 35 per cent, where would they have to cut back services they now provide.”

Coun. Al Grier, who has been vocal about needing ‘austerity measures’ said: “If you go back 40 years ago there were no services and no need for services.”

He said tax exemptions lead to “a revolving door if we continue to raise taxes because we’re supplying all these places with money or free taxes then of course it will create more people on bread lines and more people needing services . . . the bottom line is we’re trying to save some city dollars.”

The staff report breaks down the results in three possible ways, from the most liberal interpretation meaning all the current recipients would still be eligible and the 2013 total municipal exemptions would remain the same at $237,082 for all 24 organizations included in 2012.

A more strict interpretation would drop low-cost housing and senior facilities, which council had not specifically asked to keep, as well as recreation clubs which are primarily for members, not the general public.

That would drop the total to $134,990, well below the 1.55 per cent of total taxes ($180,000) cap called for in the proposed policy.

If churches who also provide donations to other organizations — supposedly putting their financial need in question — were also dropped, the total would drop to $99,890.

A third interpretation includes partial exemptions based on different categories, like 50 per cent for recreation, cultural or educational programs and 75 per cent for youth, senior and special need groups.

Based on the 2012 recipients this would result in $164,286 in annual exemptions.

The report and proposed policy were sent back to council’s advisory committee for further comment and will return to council at a later date.