HomeMy WebLinkAboutPLN 42-23Report to
Executive Committee
Report Number: PLN 42-23
Date: December 4, 2023
From: Kyle Bentley
Director, City Development Department
Subject: Heritage Property Tax Relief Program By-law
-File: A-3300-080
Recommendation:
1.That the Heritage Property Tax Relief Program and By-law be approved, as set out in
Appendix I to Report PLN 42-23, and be enacted by Council;
2.That Council delegates the Director, City Development & CBO to execute the Heritage
Easement Agreement for Eligible Properties as described in the Heritage Property Tax Relief
Program By-law;
3.That the City Clerk give notice of this by-law to the Ministry of Finance and the Region of
Durham within 30 days of the passing of the by-law; and
4.That the appropriate City of Pickering officials be authorized to take actions as necessary to
implement the recommendations of this report.
Executive Summary: This report seeks to obtain Council’s approval to implement a Heritage
Property Tax Relief Program and By-law. This initiative offers a financial incentive, in the form of
property tax relief, to owners of eligible heritage properties. The goal is to assist them in managing
the maintenance and repair costs associated with heritage buildings.
The Municipal Act, 2001 (Section 365.2) allows municipalities the option of establishing a Heritage
Property Tax Relief Program for properties that are designated under Part IV or Part V of the
Ontario Heritage Act, and are also subject to a Heritage Conservation Agreement. The City of
Pickering does not currently have any heritage conservation assistance programs in place. At the
September 28, 2020, Council meeting, staff were directed to report back to Council, by the end of
2020, with a Heritage Property Tax Rebate Program, based on the Notice of Motion presented at
the July 27, 2020, Council meeting. However, at the December 7, 2020, Council meeting, staff
were directed to report back to Council on the implementation of the Heritage Property Tax Relief
Program at such time that the COVID-19 Pandemic is under control.
The maintenance and rehabilitation of heritage structures benefit the community as a whole.
Well-preserved heritage structures provide a cultural link to our past, greatly augment the unique
character and sense of place in our communities, support re-urbanization initiatives and tourism,
stimulate adjacent development, and increase property values. Municipalities in Ontario may
support built heritage conservation in various ways.
PLN 42-23 December 4, 2023
Subject: Heritage Property Tax Relief Program By-law Page 2
The merits of implementing the Ontario Heritage Property Tax Relief Program as a possible
heritage conservation support initiative are brought forward in this report.
Heritage Pickering is in support of the property tax relief program. The draft by-law to be enacted is
attached as Appendix I.
Financial Implications: Municipalities may provide a property tax reduction between 10 and 40
percent of the property tax bill. The municipal portion of the tax relief is borne by the local
municipality. The Province participates in the program by matching the municipality for the
education portion of the property tax relief made available to eligible property owners.
The Region can also participate with a matching reduction in the Regional portion of the property
tax bill. Durham Region is currently deferring the decision to match any local program reductions
until such a time as standardized programs are implemented Region-wide. In other words, it is
staff’s understanding that Durham Region will participate in a similar program when all eight lower-
tier municipalities offer a similar heritage property tax relief program.
Approximately 50 properties could be eligible for this program in the City of Pickering. If the by-law
is approved to provide a 20 percent rebate to properties enrolled in the program, this represents a
refund of $19,755 in taxes yearly.
Any costs associated with enrolling an eligible property in the program will be paid for by the
property owner. For example, the first time an owner enrolls, they will have to pay for the
preparation of a Heritage Easement agreement and register the Agreement on title in the Land
Registry Office.
1. Discussion:
Heritage property tax relief is a financial tool for municipalities to help owners of eligible
heritage properties continue to maintain and restore their properties. Section 365.2 of the
Municipal Act, 2001 gives municipalities the option of establishing a program to provide
property tax relief to owners of heritage properties. Municipalities must first pass a by-law to
adopt the program.
The draft by-law to provide property tax relief to eligible heritage property, attached as
Appendix I to this report, has been prepared in consultation with the City’s Finance
Department and Corporate Services Department.
2. Benefits of Heritage Property Tax Relief
Well-maintained heritage properties enrich quality of life and give communities a sense of
place and unique character. Although there are community benefits to conserving heritage
properties, many are privately owned. The program provides an incentive to owners to
make regular investments in the ongoing maintenance and conservation of their properties.
Further, with regular repair and maintenance, costly major renovation projects can be
avoided.
PLN 42-23 December 4, 2023
Subject: Heritage Property Tax Relief Program By-law Page 3
3. Property Tax Relief Amount
The Municipal Act allows municipalities to provide between 10 and 40 percent of tax relief,
and the rebate amount is currently proposed at 20 percent. The rebate is applied to the City
of Pickering portion of municipal taxes, as well as on the education portion. The Region of
Durham is currently not participating in the program.
For example, a property owner would receive a 20 percent refund on the City of Pickering
portion of their tax bill, and a 20 percent refund on the education portion of their tax bill.
Should Council approve the by-law, a notice will be sent to the Ministry of Municipal Affairs
and Housing, enabling the province to fund the education portion.
Staff recommend that the City provide a credit to the property tax account, similar to the
Low-Income Seniors/Persons with Disabilities Property Tax Grant program. In addition, the
property owner’s tax account has to be in “good standing” to be eligible for the program
The amount of taxes a property owner pays depends on the assessment of the property
from the Municipal Property Assessment Corporation (MPAC). Municipalities can work with
MPAC to determine the area of a property eligible for the heritage tax rebate. It is assumed
that most properties will be straightforward to assess. For example, the tax rebate would
apply to the property in its entirety. In some instances, however, a heritage house may be
located on a 40-acre farm, with other outbuildings and landscape features not described in
the designation by-law. The municipality may then apply the tax relief to only the assessed
portion surrounding the house or a portion of the house.
4. Eligible Properties
Approximately 50 properties are eligible for the Heritage Property Tax Relief Program, both
within the Whitevale Heritage Conservation District, and outside of the District. This number
excludes properties that are currently owned by the provincial or federal governments.
Should those properties be purchased by a private owner in the future for residential use,
they may be considered eligible for the program.
Properties within the District that are identified as having no historical or architectural
significance, as noted in the Whitevale Heritage Conservation District Guide, are not
eligible for the Heritage Property Tax Relief Program. The intent of the heritage tax relief
program is to incentivize the maintenance and repair of buildings with cultural heritage
value or significance.
The Municipal Act sets out minimum criteria for an eligible property, and allows the
municipality to have flexibility with additional criteria. The draft by-law includes the following
eligibility requirements (see attached Draft By-law, Appendix I):
• designated under Part IV of the Ontario Heritage Act (an individually designated
property);
• a property that is part of a heritage conservation district under Part V of the Ontario
Heritage Act, except for properties included without having Historical or Architectural
Significance within the Whitevale Heritage Conservation District Guide;
PLN 42-23 December 4, 2023
Subject: Heritage Property Tax Relief Program By-law Page 4
• subject to a Heritage Easement Agreement with the City of Pickering under Section 37
of the Ontario Heritage Act;
• complies with the additional eligibility criteria set out in this by-law;
• that has a realty tax class of R – Residential, and a realty tax qualifier of T – Taxable;
and
• that is in a good and habitable condition, as determined by the City.
5. Application Process and Enrollment
City Development staff will develop an application form, a template for an easement
agreement and a property owner information package. The owner of an eligible property
may apply before the last day in February, in the year following the year of which the owner
is seeking to obtain a heritage property tax refund (a deadline mandated by the Municipal
Act). For example, to receive a tax relief for a particular year (for example 2023), property
owners must submit their applications by February 28 of the following year (for example
2024). The property owner will be required to submit the form along with any additional
information such as photos of the property or proof of ownership.
Staff will then determine the heritage attributes of the property and whether it meets the
eligibility requirements, and may conduct research and a site visit to do so. A Heritage
Easement Agreement must be registered on title with the Land Registry Office. This
process could take several weeks or months as the one-time process of creating the
Agreement is finalized. Finance staff will then enroll the eligible property into the program.
The owner will be responsible for paying the City all costs incurred by the City relating to
the registration of the Heritage Easement Agreement on title with the local Land Registry
Office. No additional fee will be charged by the City for enrollment.
Applications must be made each year that an owner wishes an eligible property to be
considered. Staff anticipate that the homeowner, if enrolled, will receive a credit directly on
their tax bill.
6. Non-Compliance
If an owner of an eligible property is in non-compliance with their Heritage Easement
Agreement, then no property tax reduction, or refund, will be issued to the owner until the
City is satisfied that the eligible property is back in compliance. The owner shall be required
to repay part, or all, of any heritage property reduction, or refund, previously provided to the
owner during any period of non-compliance.
Should an eligible property be demolished or removed from the program for non-compliance,
the City shall add the value of any heritage property tax reduction or refund previously
provided, plus applicable penalties and interest, to the owner’s property tax bill.
PLN 42-23 December 4, 2023
Subject: Heritage Property Tax Relief Program By-law Page 5
7. Program promotion
The Heritage Property Tax Relief program will be advertised on the City of Pickering’s
Heritage Website. Staff will prepare an application form and information brochure about the
program. Staff also plan to mail a letter to eligible properties each year to remind them of
the program.
8. Pickering Heritage Advisory Committee supports the draft by-law and program
The Draft By-law was presented to the Pickering Heritage Advisory Committee at its
November 8, 2023, meeting. City Development staff responded to various questions
regarding the program including matters related to: the cost to property owners to enroll in
the program; the gradual growth of the program over time; how the eligible property owner
is held accountable to the program; what happens when the eligible property is sold; and,
what the consequences are to an enrolled property owner opting out of the program. The
Committee passed the following motion:
“That Heritage Pickering recommends that Council approve the draft
Heritage property tax relief by-law.”
9. Staff recommend approving the program and by-law to provide property tax relief to
eligible heritage property in the City of Pickering
Recognizing that preserving built heritage is a community benefit, the by-law provides an
incentive for property owners to provide ongoing maintenance before repairs become too
costly. Staff recommend that the by-law and program be approved.
Appendix:
Appendix I: Draft Heritage Property Tax Relief By-law
PLN 42-23 December 4, 2023
Subject: Heritage Property Tax Relief Program By-law Page 6
Prepared By:
Original Signed By
Emily Game, BA, CAHP
Senior Planner, Heritage
Original Signed By
Nilesh Surti, MCIP, RPP
Division Head, Development Review
& Urban Design
Approved/Endorsed By:
Original Signed By
Catherine Rose, MCIP, RPP
Chief Planner
Original Signed By
Kyle Bentley, P. Eng.
Director, City Development & CBO
Original Signed By James Halsall
for Stan Karwowski
Stan Karwowski, MBA, CPA, CMA
Director, Finance & Treasurer
EG:ld
Recommended for the consideration
of Pickering City Council
Original Signed By
Marisa Carpino, M.A.
Chief Administrative Officer
Appendix I to
Report PLN 42-23
Draft Heritage Property Tax Relief By-law
The Corporation of the City of Pickering
By-law No. XXXX/23
Being a by-law to provide property tax relief to eligible
heritage property in the City of Pickering.
Whereas Subsection 365.2 of the Municipal Act, 2001, S.O. 2001, c.25, as amended,
provides that a local municipality may establish a program to provide tax reductions or
refunds in respect of eligible heritage property;
And whereas the Council of a Municipality may in a by-law delegate its authority in
accordance with Section 23.1 of the Municipal Act, 2001;
And whereas The Corporation of the City of Pickering finds it in the public interest to
provide financial assistance in the terms set out in this by-law as an incentive for
property owners to renovate, restore and maintain heritage property in the City of
Pickering;
And whereas for the purpose of administering the program to provide tax reductions or
refunds in respect of eligible heritage properties in the municipality, the City of Pickering
finds it would be expedient to delegate execution of heritage easement agreements to
the Director, City Development & CBO, or designate;
Now therefore the Council of The Corporation of the City of Pickering hereby enacts as
follows:
Part 1: Definitions
“Act” means the Ontario Heritage Act, R.S.O. 1990, c. O.18, as amended.
“Assessment Corporation” means the Municipal Property Assessment Corporation.
“City” means The Corporation of the City of Pickering or the geographic area of the City
of Pickering as the context requires.
“Council” means the Council of The Corporation of the City of Pickering.
“Eligible Property” means a property or portion of a property located within the limits of
the City,
(a) that is designated under Part IV of the Act;
(b) that is part of a heritage conservation district under Part V of the Act, except for
properties listed without having Historical or Architectural Significance within the
Whitevale Heritage Conservation District Guide;
By-law No. XXXX/23 Page 2
(c) that is subject to a Heritage Easement Agreement with the City under Section 37
of the Act;
(d) that complies with the additional eligibility criteria set out in this by-law;
(e) that has a realty tax class of R – Residential, and a realty tax qualifier of
T - Taxable; and
(f) that is in a good and habitable condition, as determined by the City.
“Heritage Easement Agreement” means an agreement made under Section 37 of the
Act, which sets out easement or covenant obligations with respect to but not limited to
the preservation of heritage features and value of heritage property and is registered on
title to an Eligible Property in the Land Registry Office, and which is enforceable by the
City against the Owner and subsequent Owner of an Eligible Property.
“Owner” means the registered owner(s), from time to time, of an Eligible Property, and
includes a corporation and partnership and the heirs, executors, administrators and
other legal representatives.
“Program” means the Heritage Property Tax Relief Program.
Part 2: Delegation
2.1 Council of The Corporation of City of Pickering delegates the authority to execute
a Heritage Easement Agreement between an Eligible Property Owner and the
City of Pickering to the Director, City Development & CBO, or designate.
Part 3: Application and Eligibility
3.1 An Owner of an Eligible Property must make an application to the Program by
submitting the prescribed application form to the City no later than the last day of
February in the year following the year for which the Owner is seeking to obtain a
heritage property tax reduction or refund. Applications received after this
deadline will not be accepted.
3.2 Upon acceptance of a satisfactorily completed application by the Director, City
Development & CBO, or designate, and if necessary in consultation with the
Heritage Committee, the Director, or designate may approve a Heritage
Easement Agreement and execute the agreement for registration on title to the
Eligible Property. Once the registration is confirmed, the City’s Finance
Department shall enroll the Eligible Property in the Program.
3.3 Applications to the Program must be made each year that an Owner wishes an
Eligible Property to be considered for a heritage property tax reduction or refund.
By-law No. XXXX/23 Page 3
3.4 In order to determine eligibility for the Program, the Owner consents to the
inspection of the Eligible Property as and when deemed necessary by the
Director, City Development & CBO, or designate.
3.5 Where multiple Heritage Easement Agreements are registered on title to one
parcel of land comprising an Eligible Property, multiple heritage property tax
reductions or refunds will not be provided in respect of the same heritage
features of the Eligible Property.
3.6 The Program is subject at all times to funding made available by Council in its
annual budget. This by-law does not obligate Council to provide funding for the
Program, and the heritage property tax reduction or refund contemplated by this
by-law may be eliminated by Council through repeal of this by-law at any time
with no notice whatsoever to any affected persons.
3.7 The Program is subject to any regulations that the Minister of Finance may make
governing by-laws on tax reductions or refunds for heritage property.
Part 4: Non-Compliance
4.1 In the event that:
(a) the Director, City Development & CBO, or designate, determines that the
Heritage Easement Agreement has not been complied with to the
satisfaction of the City;
(b) the Eligible Property is in contravention of work orders, municipal
requirements or liens; or
(c) applicable taxes, penalties, interest and other charges for the Eligible
Property have not been paid to the City, then
no heritage property tax reduction or refund will be issued to the Owner and
the City may require the Owner to repay part or all of any heritage property
tax reduction or refund previously provided to the Owner during any period
of non-compliance. Upon the Director, City Development & CBO, or
designate, being satisfied that the Owner has brought the Eligible Property
back into compliance, the Eligible Property will be re-enrolled in the
Program.
4.2 The Director, City Development & CBO, or designate, shall send written notice to
the Owner of the Eligible Property informing the Owner that the Eligible Property
was found to be out of compliance. The written notice shall describe the nature of
the non-compliance.
4.3 An Owner who has received written notice pursuant to Section 4.1, shall have
thirty (30) days to:
By-law No. XXXX/23 Page 4
(a) bring the Eligible Property into compliance to the satisfaction of the Director,
City Development & CBO, or designate; or
(b) satisfy the Director, City Development & CBO, or designate, that a workable
plan has been developed to bring the Eligible Property into compliance.
4.4 Upon being satisfied that the Eligible Property is back in compliance, the
Director, City Development & CBO, or designate; shall provide written notification
to the Owner and the City’s Finance Department indicating that the Eligible
Property is in compliance and that the heritage property tax reduction or refund
will continue.
4.5 In the event the Owner does not bring the Eligible Property back into compliance
within the timeline pursuant to Section 4.3, the Director, City Development & CBO,
or designate, shall provide written notification to the Owner and the City’s
Finance Department indicating that the Eligible Property shall now be removed
as an Eligible Property from the Program.
4.6 Should an Eligible Property be removed from the Program for non-compliance,
the City may add the value of any heritage property tax reduction or refund
previously provided, plus applicable penalties and interest, to the Owner’s
property tax bill.
Part 5: Annual Tax Reduction or Refund
5.1 Subject to the conditions set out in this by-law, an Owner shall receive a heritage
property tax reduction or refund for each year in which the Owner and the Eligible
Property meet all of the requirements of this by-law.
Part 6: Amount of Tax Reduction or Refund
6.1 The amount of heritage property tax reduction or refund provided in respect of an
Eligible Property shall be twenty percent (20%) of the taxes for municipal and
school purposes levied on the whole or a portion of the Eligible Property.
6.2 Any costs incurred by the City to register the Heritage Easement Agreement on
title to the Eligible Property or to validate or calculate the heritage property tax
reduction or rebate will be deducted from the heritage property tax reduction or
rebate amount issued.
Part 7: Property Assessment
7.1 The City will work with the Assessment Corporation to determine the whole or
portion of a property’s total assessment that is attributable to the building or
structure that is an Eligible Property, and the land used in connection with it. It
will be solely the City’s decision to determine the amount of heritage property tax
reduction or refund applicable to the Eligible Property.
By-law No. XXXX/23 Page 5
7.2 In the event that an Eligible Property’s assessed value, as determined by the
Assessment Corporation, changes for any reason whatsoever, then the amount
of the heritage property tax reduction or refund shall be recalculated accordingly.
Part 8: Interest
8.1 The City may require the Owner to pay interest on the amount of any repayment
under this by-law, at a rate not exceeding the lowest prime rate reported to the
Bank of Canada by any of the Banks listed in Schedule I of the Bank Act
(Canada), calculated from the date or dates the heritage property tax reduction or
refund was provided.
Part 9: Penalty
9.1 If the Owner of an Eligible Property demolishes the property or breaches the
terms of a Heritage Easement Agreement, the City may require the Owner to
repay part or all of any heritage property tax reductions or refunds provided to the
Owner for one or more years under this by-law.
Part 10: Sharing of Repayment
10.1 Any amount repaid to the City by the Owner pursuant to this by-law shall be
shared by the City, the School Boards and the Region of Durham, if applicable,
that share in the revenue from taxes on the Eligible Property, in the same
proportion that they shared in the cost of the heritage property tax reduction or
refund on the Eligible Property.
Part 11: Notification
11.1 The City Clerk is hereby directed to give notice of this by-law to the Minister of
Finance and the Region of Durham within thirty (30) days of the passing of this
by-law.
Part 12: Force and Effect
12.1 This by-law shall come into force and effect on the date it is passed.
By-law passed this XX day of XXXX, 2023.
________________________________
Kevin Ashe, Mayor
________________________________
Susan Cassel, City Clerk