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Business Taxes versus Residential Taxes

When one looks at the fairness of the taxation burden applicable to a commercial business in this City, one must not just compare the City’s “mil-rate”, one must also consider the underlying property value to which that “mil-rate” applies. Lonsdale’s central corridor is the primary home to the City’s commercial business activity. The Lonsdale corridor also represents the highest value properties in the City. A 50’ x 150’ commercial lot located in Lower Lonsdale (“LoLo”) pays municipal taxes of approximately $50,000 annually for the land. A 50’ x 150’ residential single-family property valued at $1,000,000ish pays approximately $4,200 annually for the land and improvements. The commercial property tax burden is approximately 12 times that borne by the residential property owner. Yet the business opportunity available to the commercial property owner or occupant does not justify this differential. The issues which drive this disproportionate tax burden are both the tax ceiling under which Port industrial lands operate as imposed by others, together with the ever increasing value of the Lonsdale corridor, which is a direct result of the “Density Bonusing” regime being pursued by the City in exchanged for ever increasing amenity contributions.

As the allowable density in the Lonsdale Corridor increases with each new redevelopment proposal, so does the value of property in that corridor. Essentially, developers will pay more, because they can develop more units per square foot of landmass, thereby making more profit. The term applied to this value added development enhancement is Floor Space Ration (or “FSR”). If the FSR allowed by the City goes up, the number of unit goes up with it.

IT IS MY POSITION THAT the City’s business community pays to much tax versus the value it receives through City Hall. I will not pledge to reduce taxes, because I do not know if such a commitment could be honored. But I will commit to deliver more value to the business community through City Hall funded programs. Further, If elected I will commit not to raise the cost of municipal property taxes paid by commercial businesses for the full four-year term of the next municpal council. I will also attempt to ensure that the “actual cost” of municipal taxes payable by a commercial property, independent of the “mil-rate”, does not increase. I will also look to resolve the proposed LoLo BIA mechanism, and BIA’s generally throughout the City, with a funding model which provides access to existing municipal tax revenues, without creating a parallel taxation regime and bureaucracy as proposed in the recent LLBA BIA negative petition process. How:

  1. I will propose the City enter into a new “fee-for-service” business relationship with the North Vancouver Chamber of Commerce (the “Chamber”) whereby the Chamber would enlarge its mandate to include area specific initiatives like BIA’s so that organizations like the LLBA effectively become a subordinate committee structure within the Chambers mandate, but without any additional administrative tax burden or levy upon the business community, and
  2. I will propose to the Chamber that they increase their commercial business participation and membership. I will lobby for establishment of area specific committee delegate appointments from each commercial precinct located within the City to each newly formed BIA precinct committee within the Chamber. I will propose that Delegates be nominated and appointed from each local business precinct, to sit on each precinct specific BIA committee, which would then decide how the annual resource budget for that individual BIA is best spent. Program funding for special events, street closures, event advertising, local business area signage and way-finding maps and signage, would all form a part of the annual budget uses for the funding provided by the City, and administered by the delegates. Delegates would be appointed to the pricinct specific business community BIA’s from each of the business types found within that particular BIA area. The task of these people would be to determine the highest and best use for the annual monies provided to each BIA precinct.  Each delegate would serve at the pleasure of the business community situated within their precinct, and answer to that community through the Chamber, and
  3. I would not look to transfer the current municipally funded obligations of the City in each BIA area to the newly formulated Chamber based BIA budgets. If a transfer of work load from City Hall administration to a Chamber BIA was determined to be appropriate, then that transfer would come with the additional funding necessary to do the work downloaded to the BIA.
  4. The City would initiate a dialogue and partnership with the business community wherein it did not act alone, or in a way contrary to the business communities wishes. Only after hearing and understanding the needs, wants and wishes of the business community would the City proceed with actions effecting their wellbeing, provided always that any requested actions fell within allowable legal parameters.

When I find myself in a position to effect change, the policies setout above will guide my decision-making in respect of councils relationship with the business community.

What do you think?

What do you think about my position on Business Taxes versus Residential Taxes?

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