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HomeMy WebLinkAboutCS 02/99 \ - ~\" OF 1'/0 ~O_~ ~ .~. ~ ~ REPORT TO COUNCIL FROM: Gillis A. Paterson Director, Corporate Services & Treasurer DATE: Novcmbcr 30, 1999 REPORT NUMBER: CS 02/99 SUBJECT: Royal Canadian Legion Branch 483 - 4937 Brock Road NOI1h, Claremont Requcst for Exemptions from Property Taxes RECOMMENDATION: That Report CS 02/99 of the Director, Corporate Services &Treasurer be received and that: I. the Royal Canadian Legion Branch 483 (Claremont) be granted an exemption from property taxes for a period not exceeding ten years effective January 1, 1999; 2. the Regional Municipality of Durham be notified of the changc in tax status for Legion Branch 483 resulting from Recommendation No.1; - 3. the Director, Corporate Services & Treasurer write the Minister of Finance, to inform the Minister of the tax exempt status of Legion 483 and of the granting of charity property tax rebate for Legion 606 in an attempt to obtain Provincial funding for the education portion or their property taxes; 4. the necessary By-Law as contained in Schedule A be read three times and passed; and, 5. the appropriate staff of the Town of Pickering be given authority to give effect thereto. ORIGIN Director, Corporate Services & Treasurer AUTHORITY: Municipal Act R.S.O. 1990, as amcnded, Section 207.62 and Regulations. FINANCIAL IMPLICATIONS: Legion Branch 483 (Claremont) - The 1999 total tax liability for this property is $5,951.80. If Council approves the property tax exemption, the Claremont Legion would only be liable for the education portion of their property taxes. The Minister of Finance would then be requested to provide offsetting funding for this portion. The Town's loss of tax revenue for 1999 would be $1,400. It is difficult to estimate the ten year loss of revenue for the Town clue to potential changes in the tax rate ancl assessment. Report to Council CS 02/99 Date: November 30, 1999 - Subject: Royal Canadian Legion Branch 483 -- 4937 Brock Road NOlih, Claremont Request for Exemptions from Property Taxes Page 2 Legion Branch 606 (Bayly St.) For Legion Branch 60(J, the Town of Pickering will provide a grant through the Charities (Property) Tax Rebate program in the amount of$886.90 for 1999. The rebate is shared among the Town, Region and Local Sehool Boards on the basis of respective share of taxation. The Town's cost of this rebate is $124.16. EXECUTIVE SUMMARY: In November, 1998, the President of Branch 483 (Claremont) at the above mentioned address wrote to the Clerk of the Town of Pickering requesting an exemption from taxes under the Municipal Act (copy attached). The Clerk then forwarded the request to the Treasurer. Many aspects have been researched since then and staff expanded the request to include the only other Legion identified within the municipality. The correspondence from the Royal Canadian Legion was reviewed and the assessment roll for the Town of Pickering was examined to see if other similar properties could be identified. Other lakeshore municipalities were also contacted to learn of their handling of similar situations. - The municipalities of Ajax, Oshawa and Whitby all have Canadian Legion branches. It is our understanding that these properties are assessed as residential and have experienced a decrease in their taxes as a result of current value assessment. Furthermore, there does'not appear to be any other multicultural, veterans, religious or other similar situations in Pickering that might also request a tax exelllption under the provisions contained in the Provincial legislation, This report deals not only with the request from Branch 483 but also with the only other such facility identified, Branch 606 (Bayly St.). BACKGROUND: There are currently two Legion veteran associations that operate a facility in the Town of Pickering, The application of a tax relief strategy is different for both organizations due to the fact the properly they occupy falls under two different realty classes. The tax relief strategy is lIwinly dependent upon the property's realty tax class. Table one provides a summary and comparisoll of the various options. Table One - Comparison of Tax Relief Strategies & Application Realty Tax Class Legion Branch 483 Claremont Residential Legion Branch 606 1555 Bayly S1. Commercial - tenant in a plaza. Was applied. Education taxes N/ A - only applies to those charities that occupy either industrial or commercial space. Section 207, subsection 62 of the Municipal Act allows the Town to pass a bylaw to waive the lower and upper tier taxes Still Liable to pay. Staff will try to get the Province to nav the N/A - Registered Charity Tax Rebate - (Section 442.1 oj the Municipal Act) Exemption from Taxes May be exempt. Letter from Minster of Finance Report to Council CS 02/99 Date: November 30, 1999 - Subject: Royal Canadian Legion Branch 483 - 4937 Brock Road North, Claremont Request for Exemptions from Property Taxes Page 3 Exemption from assessment Requires "Private Members Bill." Gcncrally not favorcd as property must be monitored in case of change of ownership. Hides cost of indirect "grant". indicate tax relief may be provided. N/A education taxes. Legion Branch 483 (Claremont) The building in question is owned by the Claremont Legion. There are several courses of action that can be followed in situations like this: . a grant from the municipality to offset the taxes payable; . an exemption from assessment; or . an exemption from taxes; - In the past, many municipalities have favored a grant, as a grant to offset taxes is no different than one to offset other expenditures and it ensures that the matter would come up for consideration from time to time through the municipal budget process otherwise it becomes a non-budget expenditure or loss of revenue. The short come of this option is that the local municipality bears the entire cost of the grant. If this option is chosen the grant amount for 1998 would be $6,891.58 and for 1999 the amount is $5,951.80. An exemption from assessment would require a special act called a Private ,'v[embers Bill of the Ontario Legislature and the process would have to be explored further if this was the chosen option. The benefit of an exemption from assessment is that all taxing bodies, i.e. local municipality, upper tier and school boards share in the lost revenue and a higher mill rate is charged by all bodies on the remaining taxpayers in the municipality. In the regional situation such that we have in Durham all other properties in Durham in which the region and school board tax would be subject to a proportionally higher tax rate as a result of this. The shortcome of this option is the exemption remains in effect, even if the use changes, until another Bill is introduced in the house. 'l.~l' The third altemative is the exemption from taxation as permitted under the Municipal Act, Section 207, Subsection 62. The Town of Pickering has the authority to pass a bylaw to exempt the Canadian Legion from taxation, except for school purposes, for a period not exceeding ten years. Staff would notify the Region of the bylaw and the corresponding reduction in the Region's taxation revenue. The Town of Pickering would then petition the Provincial Govell1l1lent (Minister of Finance) to pay the education portion of the Legion's property taxes. (The Minister of Finance's offer to pay for the educational portion of property taxes was made in conjunction with the use of the Charitable Property Tax Rebate scheme. The Town of Pickering is using a different tax tool to provide tax relief and are not sure if the Minister would still pay the education taxes.) If the Town is unsuccessful, Legion Branch 483 would be liable for the education portion of their property taxes which is equivalent to $1,625 or 27.3 per cent of their 1999 tax bill. Under this option, the loss of taxation revenue would be limited to the Town's portion which would be $1,400 in 1999. - The Regional Municipality of Durham be notified of the change in tax status for Legion Branch 483 resulting from Recommendation No.1. The attached By-Law has been reviewed by the Town Solicitor and approved as to foml. Legion Branch 606 (Bayly St.) One other Legion (Branch 606) was identified at 1555 Bayly Street. The property tax situation for the South Pickcrinl!: location however. is not the same as Claremont. The South Pickering Report to Counei I CS 02/99 Date: November 30, 1999 - Subject: Royal Canadian Legion Branch 483 - 4937 Brock Road North, Claremont Request for Exemptions from Property Taxes Page 4 Legion is a tenant of a commercial property and as such are eligible for the Charity (Property) Tax Rebate of a portion of their annual taxes under Paragraph I of Subsection 442.1 (3) of the Municipal Act, if they arc a Registered Charitable Organization. Staff have contacted the Ontario Command of the Royal Canadian Legion and have been provided with the Registered Charity Number. (Prior to the 1998 taxation year, Registered Charities occupying commercial or industrial property were taxed at the residential rate and were exempt from the Business Occupancy Tax.) The Charity Tax Rebate available under the Municipal Act is basically designed to return the charities to their former tax position by providing a rebate equivalent to the Business Occupancy Tax. Legion Branch 606 will receive a cheque in the amount of$886.90 [or their 1999 Charity (Property) Tax rebate. This rebate is shared among the Town, Region and Local School Boards. The Legion will have to apply annually to the Town for continuation of this rebate. No action is required by Council for the Legion to receive this rebate. In an attempt to provide further tax relief, the Town of Pickering would petition the Provincial Govemment (Minister of Finance) to pay the education portion of the Legion's propelty taxes. The attached letter from the Minister of Finance to City of Toronto Councillor Frances Nunziata indicates that the Province may be willing to absorb the education taxes. The education taxes for the Bayly Street Legion are estimated to be $6,700.00. - ATTACHMENTS: Letter from President, Branch 483 Letter from Ernie Eves, Minister of Finance By-Law To Provide the Royal Canadian Legion Branch 483 an Exemption from Property Taxation Prepared By: Approved / Endorsed By: . ~ '- -----y;;:~~ ~ Gillis A. Paterson, Director, Corporate Services & Treasurer Stan Karwowski, Manager of Finance GAP:vw Attachmcnts Copy: Jane Burton, Town Solicitor Bruce Taylor, Town Clerk ~ Recommended [or the consideration of Pickering Town Council Thomas J. uinn, Chief Administrative Officer ATTACHMENT #-1-.. TO REPORT' ('5' oJ.!ClC, - THE ROYAL CAi"TADIA1"\f LEGION BRA1"\fCH 483 4937 BROCK ROAD N. CLAREMONT, ONTARIO L1Y lA6 905-649-3166 F A..,"'( 905-649-1119 Town of Pickering Atm: Bruce Taylor, Town Clerk One The Esplanade Pickering, Ontario Dear Bruce, Re: Tax exemption for Legion Branches Please consider this a formal request, on behalf of Royal Canadian Legion Branch 483, for a tax exemption under the Municipal Act of Ontario, Chapter 302, Section 208, Paragraph 60. We are not the first Branch within the Province to request this exemption. As a mater offact, branches have been receiving this tax break for a number of years. - Paragraph 60 states and provides for the exemption taxation thus: '...except for local . improvements and school purposes, for a period not exceeding ten years, any premises actually used and occupied as a memorial home, clubhouse, or atWetic grounds by persons who served in the armed forces of her majesty or Her Majesty's allies in any war.' Legion grounds and premises fall under the above classification. The Royal Canadian Legion has long stood for service to our country, veterans, seniors, youth, community and civic responsibilities. It has done so proudly and to the best of its' abilities. It has never varied in this commitment. Recent changes in the social and economic climate have created financial hardship for many within our Municipality. Branch 483 has been no exception. We are struggling to maintain our service commitments. For this reason only, we request the 'ten year' tax exemption. It is viewed as a needed bridge to a viable future. Please inform us if anything more is required, or if we can be of any further assistance. Your aid in this matter is greatly appreciated. _~~l~ - C. Farragher President, Branch 483 - .- Ministry of Finance Office of the Minister Frost 8uilciing South 7 Queen's Park Cres Toronto ON M7A 1Y7 Tel (416) 325-0400 Fax (416) 325-0374 Ministere des Finances Bureau du ministre Edifice Frost sud 7 Queen's Park Cres Toronto ON M7 A 1Y7 reI (416) 325-0400 relec (416) 325-0374 ATTACHMENT # 2... TO REo'JRT # ~ O~ftc\ April 13, 1999 Ms. Fr~nces Nunziata Councillor, York-Humber .T..h.:>- ("'~"""""'e""a'" ~ 9"-' ~ ........- ~ -=..E. To:::::-o::':.:::: -...- --;:-- - -- -- ~ ~ -...;...w:t ~ Met~o Hall 55 John Street, Suite 204 Toron~o ON M5V 3C6. Dear Ms. Nunziata: - \ Thank you for your ietters supporting an exemption from the education portion of property taxes for the ~oyal C~na~ian Legion branches. I unde~stand and appreciate the. level.of service and benefits. Royal Canadian Legions_.provide ~o communities throughout the province. As you may be aware, under section 442.1 of the MuniciDal Act, municipalities have the. power to provide property tax rebates to charities and similar organizations. Municipalities can determine the eligibility criteria for similar organizations and can rebate up to 100 per cent of an organization's property.taxes if they so choose.. The Province 'I'~ ~l s:::::':-61 ~ ~ ~ ~ :-eba'.:o p""'osr::.:-:-. ~'l:.'.:l: r::cpcG~ !c€- ae education portion of the property taxes. I appreciate your taking the time to bring this matter to ~y personal attention. Yours .sincerely, .~~~ Ernie Eves, Q.C. Minister of Finance - @ ATTACHHENT"~ TO REPORT'~ Ck.) 1\1 :n[E CORPORATION OF THE TOWN OF PICKERING ,- BY-LAW NO. 559'/cf~ Being a by-law lo provide Royal Canadian Legion Branch 4~J an exell1plion from properly taxation except for school purposes fC.lr a period not exceeding ten years elTedive January 1, 1999. WII EREAS Royal Canadian Legion Branch 483 has requested the Town of Pickering to provide an exemption in property taxes excluding taxation for school purposes for a period not exceeding ten years. WH EREAS, the Town of Pickering under the Municipal Act, R.S.O., 1990, as amended, Section 207.62 may pass a bylaw to exempt from taxation any premises used by persons who served in the armeu forces of lieI' Majesty. NOW THEREFORE THE COUNCIL OF THE CORPORATION OF THE TOWN OF PICKERING IIEREI.3Y ENACTS AS FOLLOWS: - I. That Royal Canadian Legion Branch 483 located at 4937 Brock Road North in the tvlunicipality of the Town of Pickering be exempt frol1ltaxalion except for school purposes for a period not exceeding ten years effective January 1,1999. 2. [I' the property is sold, leased, or the use changes, the property taxation exemption ends when legal title is transferred, or when the lease agreement comes into effect, or when the use changes. ,"r 3. This By-law comes into force on the date of its passing. // BY -LA W read a first, second and third time and finally passed this day of , 1999. Wayne Arthurs, Mayor . - Bruee Taylor, Clerk