Coun­cil will ad­just tax rate, says deputy mayor

Un­prece­dented in­crease in prop­erty val­ues rais­ing eye­brows throughout re­gion

The Compass - - FRONT PAGE - BY TERRY ROBERTS THE COM­PASS

An un­prece­dented in­crease in the as­sessed value of prop­er­ties — both com­mer­cial and res­i­den­tial — in this re­gion is rais­ing eye­brows among those who pay mu­nic­i­pal taxes.

In some in­stances, such as Bay Roberts and Clarke’s Beach, the av­er­age in­crease in prop­erty val­ues has spiked by 51 per cent and 42 per cent, re­spec­tively, a re­flec­tion of the ro­bust econ­omy on the Avalon Penin­sula.

But some mu­nic­i­pal lead­ers in the re­gion are re­as­sur­ing res­i­dents not to ex­pect an equiv­a­lent jump in their tax bills.

Ches Ash, deputy mayor of the Town of Car­bon­ear and chair of the fi­nance com­mit­tee, said coun­cil will very likely re­duce the tax rate — known as the mill rate — to help ease the burden on prop­erty own­ers.

“I don’t think I’m be­ing too pre­sump­tu­ious in say­ing we will ad­just down­ward,” Ash stated re­cently.

The av­er­age in­crease in res­i­den­tial prop­erty val­ues in Car­bon­ear is 35 per cent, and the mill rate cur­renty stands at 9.25. This means a house as­sessed at $200,000 is charged $1,850 in prop­erty taxes by the town.

If the value of the same house has in­creased to $240,000, and the mill rate re­mains un­changed for 2013, the tax bill in­creases to $2,220.

What’s the math­e­mat­i­cal for­mula for cal­cu­lat­ing this? Mul­ti­ply the mill rate by the as­sessed value, and di­vide it by 1,000.

Ash said coun­cil is do­ing a de­tailed as­sess­ment of the town’s fi­nan­cial needs, and ex­pects to de­cide how much it will re­duce the mill rate by mid-Novem­ber. The town’s 2013 mu­nic­i­pal oper­at­ing bud­get is expected to be fi­nal­ized by early De­cem­ber, Ash ex­plained.

He said coun­cil ad­justed the mill rate down­ward dur­ing last round of as­sess­ments, when the val­ues in­creased by 17 per cent.

Ash dis­missed any sug­ges­tion that the town might use the new as­sess­ments as a cash grab. He said mu­nic­i­palites are re­quired to op­er­ate with a bal­anced bud­get, and can only take in as much rev­enue as it needs.

He said Car­bon­ear is in a healthy fi­nan­cial po­si­tion, though he ac­knowl­edged that costs are in­creas­ing, and rev­enues will have to in­crease as well.

“We’re not des­per­ately in need of cash. Our cash flow is pretty good. We are manag­ing very well in terms of our cap­i­tal works and im­prove­ments to in­fra­struc­ture and pro­vid­ing ser­vices to res­i­dents.”

The town col­lects about $4 mil­lion annu-

We’re not des­per­ately in need of cash. Our cash flow is pretty good. We are manag­ing very well in terms of our cap­i­tal works and im­prove­ments to in­fra­struc­ture and pro­vid­ing ser­vices to res­i­dents. — Ches Ash, deputy mayor,

Town of Car­bon­ear

ally in taxes and fees, with about $1.5 mil­lion from res­i­den­tial prop­erty taxes and some $500,000 in com­mer­cial prop­erty taxes.

He said those fig­ures will in­crease, but pointed out some of it will come from growth in the res­i­den­tial and com­mer­cial sec­tor.

But with only one mill rate for all home­own­ers, it’s fair to say there will be some win­ners and some losers. Home­own­ers whose prop­erty val­ues in­creased well be­yond the av­er­age will see a big­ger in­crease than those at the other end of the scale.

ed­i­tor@cb­n­com­pass.ca

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