Proposal to add utility tax runs out of gas, support
West Kelowna will remain the only city in B.C. that doesn’t profit from its residents’ use of natural gas.
Council on Tuesday voted down the idea of a so-called franchise fee that would have seen Fortis BC Gas apply a five per cent surcharge to their customers’ bills and remit the money to the municipality.
It would have netted the city an estimated $450,000 annually and was under consideration as a way of offsetting expected declines in development-related revenues for the municipality because of the provincial government’s speculation tax.
Although it’s widely used by other B.C. municipalities, on the rationale that utility companies profit by burying lines under city-owned roads and rights-of-way, a majority of West Kelowna said they wanted no part of a franchise fee.
“I think people are tired of being nickel and dimed,” Mayor Doug Findlater said. “I think this is a back door tax and I’m quite opposed to it.”
“I would never ever ever agree to this kind of tax,” said Coun. Duane Ophus, who noted it likely wouldn’t get the required consent of voters anyway through either a referendum or the alternate approval process. “It’s just a complete waste of time to think we’ll ever get it past voters.”
The franchise fee might have cost the average West Kelowna homeowner about $60 a year, council heard.
“It’s a good idea. I;m in favour of it,” said Coun. Bryden Winsby, who was joined only by Coun. Rusty Ensign in supporting the introduction of a franchise fee.
A majority of councillors said that if becomes necessary for the City of West Kelowna to find new revenue to offset losses associated with the speculation tax, the simplest and most transparent way do so was simply to raise property taxes.
City administrator Jim Zaffino noted that, with the recent suspension of work on the 1,000 home Goat’s Peak development because of the builders’ concerns with the speculation tax, the municipality will lose about $200,000 in new property taxes that would have been paid in 2020.