HomeMy WebLinkAboutCS 45-06
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REPORT TO
EXECUTIVE COMMITTEE
Report Number: CS 45-06
Date: September 11, 2006
From:
Gillis A. Paterson
Director, Corporate Services & Treasurer
Subject:
2006 Final Tax Due Dates for Commercial, Industrial and Multi-
Residential Realty Tax Classes
Recommendation:
1. It is recommended that report CS 45-06 of the Director, Corporate Services &
Treasurer be received and:
2. That the Director, Corporate Services & Treasurer be authorized to issue the
FINAL 2006 Tax Bills for Commercial, Industrial and Multi-residential properties
with a due date of October 13th, 2006;
3. That the Director, Corporate Services & Treasurer be authorized to make any
changes or undertake any actions necessary, including altering the due date, in
order to ensure the tax billing process is completed and in order to comply with
Provincial Regulations;
4. That the necessary By-law attached to this report be read three times and
approved; and,
5. That the appropriate officials of the City of Pickering be given authority to give
effect hereto.
Executive Summary: Adoption of the above recommendations and passing the
attached By-law provides for the final 2006 tax billing for non-residential tax classes
(commercial, industrial and multi-residential). During the last few years, the City has
billed the final non-residential taxes separately mainly due to the additional steps that
are required as a result of the capping legislation.
Financial Implications: The attached By-law is for the FINAL billing of 2006 property
taxes for commercial, industrial and multi-residential properties. This billing of final
property taxes will raise approximately $20.8 million for the City, Durham Region and
School Boards. Tax bills for the Residential tax classes were mailed on June 16, 2006
with due dates of July ih and September 28th.
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Report CS 45-06
Date: September 11,2006
Subject: 2006 Final Tax Due Dates for Commercial, Industrial and Multi-
Residential Realty Tax Classes
Page 2
Background: In 1998, the Province introduced Current Value Assessment or
CV A on a Province wide basis to replace the old patch quilt system (throughout the
Province) where each municipality used a different base year for assessment purposes.
The end result of CV A was the fact that some business were experiencing property tax
increases well above 100%. To reduce the property tax increases, the Province
introduced capping legislation in 1998.
The City of Pickering will soon be in a position to issue the final 2006 property tax bills
in accordance with the capping provisions of Bill 140, Continued Protection For
Property Taxpayers Act, passed by the Province on December 4, 2000 and
implemented through various Regulations. (Bill 140 replaced the original capping
legislation of Bill 79 introduced and approved in 1998). This legislation was put in place
to limit assessment reform related increases to 5% per year on commercial, industrial
and multi-residential properties. Under this legislation, property owners facing
increases due to property assessment reform had their increases "capped" (reduced).
Conversely, those properties experiencing decreases were limited to that permitted
under the legislation. This meant that taxes have to be "clawed back" from those
experiencing decreases to fund the loss of revenue resulting from the capped
increases.
The funding of the capping protection is "paid for" on a Region wide basis. The Region
of Durham acts like a banker in this process. In other words, the total cost of the
capping protection for example, the commercial tax class is paid for by the other
commercial properties throughout the Region by having a portion of their related
property tax decrease withheld (clawed back). As part of the Region wide process, the
City of Pickering uses a Provincial database program called "Online Property Tax
Analysis" (OPT A) to verify non-residential assessment data. Every municipality within
Durham Region uses the OPTA system. Assessment Review Board decisions and
Minutes of Settlement decisions have been incorporated into the capping calculations
up to the cut-off date of May 15, 2006.
Bill 83 - Leç,islative Chanç,es to Cappinç, Leç,islation
In 2004, the Province passed Bill 83 (An Act to Implement Budget Measures), which
provided for various optional tax tools that could be used for the non-residential tax
class. In a two tier municipal government structure, the upper tier has the option to
select all or some of the tax tools. These tax tools consisted of the following options:
1. The assessment related increase cap was increased from 5% to 10%.
2. Minimum annual threshold increase of 5% of total CV A property taxation.
3. A "billing" threshold be established whereby a property who is within the $250 of its
CV A based taxation would be required to pay its full CV A property taxes.
4. Properties that fall within the "New Construction" category will now have their
property taxes phased-in to full CV A BY 2008. For 2006, the minimum rate for New
Construction properties is 80%.
Report CS 45-06
Date: September 11 , 2006
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Subject: 2006 Final Tax Due Dates for Commercial, Industrial and Multi-
Residential Realty Tax Classes
Page 3
The purpose of these tax tools is to accelerate the movement of non-residential
taxpayers to full CV A taxes (where taxes are calculated using Current Value
Assessment multiplied by the corresponding tax rate). The Region of Durham adopted
all of the tax tools referenced above.
In 2006, the City of Pickering issued an interim tax bill to to all property owners in all tax
classes with two instalment dates of February 27th and April 27th. Final Residential
tax bills were mailed on June 16, 2006. The proposed final instalment due date of
October 13th for all properties in the Non-Residential tax classes, provides these tax
classes with some additional time to pay their tax bill. Table One below illustrates the
final billing due dates for the non-residential tax classes from 2000 to 2006.
Table One
Non-Residential Final Billing Dates
Year
Number of
Instalments
One
One
One
One
One
One
One
Date
2000
2001
2002
2003
2004
2005
2006
October 13, 2000
October 29,2001
October 29,2002
October 15, 2003
October 15, 2004
October 14, 2005
October 13, 2006
As Table One indicates, the proposed 2006 final due date closely follows the pattern
established since 2000. The one instalment due date will assist the City in managing its
cash flow.
Attachments:
1. By-law to Establish the 2006 Final Tax Instalments and Due Date for the
Commercial, Industrial and Multi-Residential Tax Classes
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Report CS 45-06
Date: September 11, 2006
Subject: 2006 Final Tax Due Dates for Commercial, Industrial and Multi-
Residential Realty Tax Classes
Page 4
Prepared By:
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/)føf1v}¡i \
..§usan Aitken sad
Coordinator, Taxation Services
Approved I Endorsed By:
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Gillis A. Paterson
Director, Corporate Services & Treasurer
GAP:vw
Attachment
Copy: Chief Administrative Officer
Recommended for the consideration of
Pickering City Council .~
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,.;ìTACHMENT#-Ì-- TO REPORT#~(;;'Ö'
THE CORPORATION OF THE CITY OF PICKERING
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BY-LAW NO.
Being a By-law of The Corporation of the City of Pickering to
Establish the 2006 Final Property Taxes and Due Date for
the Commercial, Industrial and Multi-Residential Tax Classes.
WHEREAS it is necessary for the Council of The Corporation of the City of Pickering,
pursuant to the Municipal Act, 2001, S.D. 2001, c.25 as amended, to pass a By-law to
levy a separate tax rate on the assessment in each property class; and,
WHEREAS the property classes have been prescribed by the Minister of Finance under
the Assessment Act, R.S.O. 1990, ch.A.31, as amended and its Regulations; and,
WHEREAS it is necessary for the Council of The Corporation of the City of Pickering,
pursuant to the Municipal Act, 2001, S.D. 2001, c.25, to levy on the whole rateable
property according to the last revised assessment roll for The Corporation of the City of
Pickering.
WHEREAS the Regional Municipality of Durham has passed By-law No. 26-2006 to
establish tax ratios and By-law No. 24-2006 to adopt estimates of all sums required by
The Regional Municipality of Durham for the purposes of the Durham Region Transit
Commission and By-law No. 25-2006 to set and levy rates of taxation for Regional Solid
Waste Management and By-law No. 23-2006 to set and levy rates of taxation for
Regional General Purposes and set tax rates on Area Municipalities; and,
WHEREAS it is necessary for the Council of The Corporation of the City of Pickering
pursuant to the Municipal Act, to levy on the whole rateable property according to the
last revised assessment roll for The Corporation of the City of Pickering for the current
year; and,
WHEREAS an interim levy was made by the Council of The Corporation of the City of
Pickering (pursuant to By-law No. 6615-06) before the adoption of the estimates for the
current year; and,
WHEREAS sub section 342 (2) of the Municipal Act, 2001, S.D. 2001, c.25 as
amended, permits the issuance of separate tax bills for separate classes of real
property for year 2006.
NOW THEREFORE THE COUNCIL OF THE CORPORATION OF THE CITY OF
PICKERING HEREBY ENACTS AS FOLLOWS:
1 . For the year 2006, The Corporation of the City of Pickering (the "City") shall levy
upon all Property Classes (Residential, Commercial, Industrial and Multi-
residential) as set out in By-law No. 6676/06 of Schedule A, the rates of taxation,
for the City of Pickering, the Region of Durham and for Education purposes on
the current value assessment as also set out in Schedule A of By-law No.
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2. 6676/06. Where applicable, taxes shall be adjusted in accordance with Bill 140,
as amended and its Regulations.
3. The levy provided for shall be reduced by the amount of the interim levy for
2006.
4. The 2006 final tax calculations for the industrial, commercial and multi-residential
realty tax classes is based on the "cut-off" date of May 15, 2006.
5. The decrease retained percentage for the realty class is outlined below:
Multi residential
Commercial
Industrial
98.15%
40.52%
61 .79%
6. The 2006 taxes owed for the commercial, industrial and multi-residential
assessed properties shall be due in one instalment on October 13 2006, or as
adjusted by the Treasurer.
7. Except in the case of taxes payable under Section 33 and 34 of the Assessment
Act, R.S.O. 1990, c.A31, as amended, the percentage charge as a penalty for
non-payment of taxes and monies payable as taxes shall be added to every tax
or assessment, rent or rate of any installment or part thereof remaining unpaid
on the first day of default and on the first day of each calendar month thereafter
in which such default continues pursuant to subsections 345 (1), (2) and (3) of
the Municipal Act 2001, S.D. c.25 as amended. The Treasurer shall collect by
distress or otherwise under the provisions of the applicable statutes all such
taxes, assessments, rents, rates or installments or parts thereof as shall not
have been paid on or before the several dates named as aforesaid, together with
the said percentage charges as they are incurred pursuant to sections 349, 350
and 351 of the Municipal Act 2001, S.D. c.25 as amended.
8. If any section or portion of this By-law is found by a court of competent
jurisdiction to be invalid, it is the intent of Council for The Corporation of the City
of Pickering that all remaining sections and portions of this By-law continue in
force and effect.
9. Taxes shall be payable to the Treasurer, City of Pickering.
10. This By-law comes into force on the date of its final passing.
BY-LAW read a first, second and third time and finally passed this 18th day of
September 2006.
David Ryan, Mayor
Debi Bentley, City Clerk