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Home My WebLink AboutFIN 12-21Report to Council Report Number: FIN 12-21 Date: June 28, 2021 From: Stan Karwowski Director, Finance & Treasurer Subject: 2021 Final Property Tax Due Date for Commercial, Industrial, and Multi-Residential Realty Tax Classes File: F-4200-001 Recommendation: 1.That Report FIN 12-21 of the Director, Finance & Treasurer be received; 2.That the Director, Finance & Treasurer be authorized to issue the final 2021 Property Tax Bills for Commercial, Industrial, and Multi-Residential properties witha due date of September 28, 2021; 3.That the Director, Finance & Treasurer be authorized to make any changes orundertake any actions necessary, including altering the due date, in order to ensure that the tax billing process is completed and in order to comply with Provincial Regulations; 4.That the draft By-law attached to this report be enacted; and 5.That the appropriate City of Pickering officials be authorized to take the necessaryactions as indicated in this report. Executive Summary: Adoption of the above recommendations and passing the attached By-law provides for the final 2021 property tax billing for non-residential realty 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 2021 property taxes for commercial, industrial, and multi-residential properties. This billing of final non- residential property taxes will raise approximately $32.5 million for the City, Region of Durham, and the School Boards. Tax bills for the residential tax classes were mailed during the first week of June, with due dates of June 28th and September 28th. FIN 12-21 June 28, 2021 Subject: 2021 Final Property Tax Due Date for Commercial, Industrial Page 2 and Multi-Residential Realty Tax Classes ______________________________________________________________________ Discussion: In 1998 the Province passed legislation that capped property tax increases and decreases. This became known as “capping”. The intentions were noble but the process ended up being overly complicated and resulted in unfairness between property owners. Over time properties would exit the program and be taxed equitably with other properties. In 2020 the last of the capped properties in Durham Region exited the capping program. Going forward this will make it a little easier to calculate property tax bills and adjustments for non-residential properties. The educational property tax rates that apply to property tax classes are set by the Ministry of Finance. Where previous business class education rates were set for each municipality as part of the 2020 Ontario Budget measures, the Province announced last fall a reduction in education tax rates for business classes which brought all business education tax rates to the same level. For Pickering, this announcement results in significant tax savings for the businesses classes as identified below. 2020 vs. 2021 Education Property Tax Rates Tax Class 2020 Rates 2021 Rates Difference (%) Commercial/Office Building/Shopping Centre 0.0098000 0.0088000 -10.20 Industrial 0.0125000 0.0088000 -29.60 Industrial New Construction 0.0098000 0.0088000 -10.20 Large Industrial 0.0125000 0.0088000 -29.60 As indicated above, based upon the 2021 education tax rate reduction, the City will collect approximately $3.0 million less in commercial/industrial education taxes. After taking into consideration the 2021 levy increases for the City and Durham Region and then applying the substantial reduction in education tax rates, the property tax reduction when comparing the total 2021 property taxes to 2020, results in an average reduction for the commercial taxpayer of approximately 3.9 percent and 11.6 percent for the industrial taxpayer. In other words, the commercial and industrial taxpayers will be paying less in property taxes compared to last year. In addition to mailing the tax bills, the City will advertise the tax instalment due date on the City’s webpage and in the Pickering News Advertiser as part of our communication strategy. FIN 12-21 June 28, 2021 Subject: 2021 Final Property Tax Due Date for Commercial, Industrial Page 3 and Multi-Residential Realty Tax Classes ______________________________________________________________________ Attachment: 1. By-law to Establish the 2021 Final Property Taxes and Due Date for the Commercial, Industrial, and Multi-Residential Realty Tax Classes Prepared By: Approved / Endorsed By: Original Signed By: Original Signed By: Mike Jones Stan Karwowski Supervisor, Taxation Director, Finance & Treasurer Recommended for the consideration of Pickering City Council Marisa Carpino, M.A. Chief Administrative Officer Attachment #1 to Report #FIN 12-21 The Corporation of the City of Pickering By-law No. XXXX/21 Being a By-law to Establish the 2021 Final Property Tax Due Date for the Commercial, Industrial, and Multi-Residential Realty Tax Classes Whereas it is necessary for the Council of The Corporation of the City of Pickering, pursuant to the Municipal Act, 2001, S.O. 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.O. 2001, c.25 as amended, to levy on the whole rateable property according to the last revised assessment roll for The Corporation of the City of Pickering; and, Whereas the Regional Municipality of Durham has passed By-law No. 07-2021 to establish tax ratios, and By-law No. 09-2021 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. 10-2021 to set and levy rates of taxation for Regional Solid Waste Management, and By-law No. 08-2021 to set and levy rates of taxation for Regional General Purposes and set tax rates on area municipalities; and, Whereas an interim levy was made by the Council of The Corporation of the City of Pickering (pursuant to By-law No. 7792/20) before the adoption of the estimates for the current year; and, Whereas sub section 342 (2) of the Municipal Act, 2001, S.O. 2001, c.25 as amended, permits the issuance of separate tax bills for separate classes of real property for year 2021. Now therefore the Council of the Corporation of the City of Pickering hereby enacts as follows: 1. For the year 2021, 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 Schedule “A” of By-law 7836/21, the rates of taxation, for the City of Pickering, the Region of Durham, and for Education purposes on the current value assessment. 2. Where applicable, taxes shall be adjusted in accordance with the Continued Protection for Property Taxpayers Act, 2000, as amended and its Regulations. By-law No. Page 2 3. The levy shall be reduced by the amount of the interim levy for 2021. 4. The 2021 taxes owed for the commercial, industrial, and multi-residential assessed properties shall be due in one instalment on September 28, 2021, or as adjusted by the Treasurer. 5. 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 instalment 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.O. 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 instalments 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.O. c.25 as amended. 6. 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. 7. Taxes shall be payable to the Treasurer, City of Pickering. 8. This By-law is to come into effect on the date of its final passing. By-law passed this 28th day of June, 2021. _________________________________ Dave Ryan, Mayor _________________________________ Susan Cassel, City Clerk