Taxes are going up, but not as much as you fear
Property taxes follow inflation; more money for infrastructure
Montreal property taxes are going up next year, though not by as much as last time. Most businesses will see a drop in taxes thanks to a change in how non-residential building owners are charged. And more money is being poured into repairs to roads and water infrastructure. “This budget will make a difference in the lives of our citizens today and for the generations to come,” Mayor Valérie Plante said as she unveiled Montreal’s $5.7-billion budget for 2019 on Thursday. “It will also make a difference for our business owners, who are behind the vitality of our neighbourhoods.” Here are the highlights.
TAXES
Montreal gets the bulk of its revenue — 68 per cent, or $3.9 billion — from property taxes. In 2019, the average tax hike for residential properties will be 1.7 per cent, which matches Montreal’s projected inflation rate for next year. In Montreal’s previous budget, covering 2018, the average hike for homeowners was 3.3 per cent, an increase for which Plante took heat because she had campaigned on a promise to raise taxes by no more than the rate of inflation (about two per cent at the time). Under the new budget, residential building owners are not being treated equally. The biggest hikes will hit the biggest apartment buildings. These are the average hikes for: Condos: 0.3 per cent Single-family homes: 1.3 per cent Buildings with two to five units: 1.6 per cent. Buildings with six or more units: 4.1 per cent. Here’s how the increases will affect the tax bills of typical residential properties in three categories: Condo, average evaluation $322,000. Taxes in 2019 will be: $2,791, an increase of $9, compared to 2018. Single-family home, average evaluation $457,867. Taxes will be $3,968, a $51 hike. Building with two to five units, average evaluation $533,124. Taxes will be $4,620, an increase of $71. Winners and losers The effect of the tax hike will vary from borough to borough. These boroughs will see the lowest tax hikes: Lachine (0.6 per cent) Rivière-des-Prairies—Pointe-aux-Trembles (0.6 per cent) St-Léonard (0.8 per cent) Pierrefonds—Roxboro (1.1 per cent) Verdun (1.2 per cent) These will see the highest average tax hikes: Côte-des-Neiges—Notre-Damede-Grâce (2.8 per cent) Rosemont—La-Petite-Patrie (2.6 per cent) Île-Bizard—Sainte-Geneviève (2.5 per cent) Villeray—St-Michel—Parc- Éxtension (2.2 per cent) Plateau Mont-Royal (2.1 per cent)
SUBURBS
The city of Montreal’s budget has an effect on the island’s suburbs, which share policing, firefighting, transit and other services with Montreal. In 2019, Montreal’s 15 demerged suburbs will pay an average of two per cent more than last year for such services. The highest increases will be in: Dorval Island (10 per cent) Town of Mount Royal (5.4 per cent) Baie-d’Urfé (5.1 per cent) Montreal West (4.1 per cent) Westmount (3.6 per cent) These suburbs will see decreases: Ste-Anne-de-Bellevue (13.3 per cent decrease) Kirkland (0.2 per cent decrease) Senneville (0.1 per cent decrease) Last year, suburbs were blindsided by hefty increases. In previous years, the island’s 15 demerged cities had seen increases of about the inflation rate. But in 2018, on average, they had to pay 5.3 per cent more. Hardest hit at the time: Town of Mount Royal (9.8 per cent) and Montreal West (9 per cent). With a population of 246,000, the 15 suburbs represent about 13 per cent of the 1.9 million people who live in the Montreal Island agglomeration.
NON-RESIDENTIAL PROPERTIES
Owners of non-residential buildings will benefit from a change in how properties are taxed. The city is cutting by 10 per cent the amount of taxes paid on the first $500,000 of the assessed value of non-residential buildings, including those used for offices, retail and industry. The measure applies to buildings valued at less than $3 million. Just under 60 per cent of Montreal’s non-residential buildings are valued at less than $500,000. For a building valued at $450,000, the change will result in a $1,610 drop in taxes in 2019, the city says. For a $1-million building, the savings will be $1,439. For buildings valued at between $3 million and $10 million, the average hike will be 0.8 per cent. Those valued at more than $10 million will see average hikes of 1.8 per cent. The overall average tax increase for the non-residential sector: 1.3 per cent.
SPENDING
With a $5.7-billion budget, Montreal will spend $233 million more in 2019 than it did in 2018, a 4.3 per cent increase. Four out of every 10 dollars the city collects — $2.2 billion — will be spent on salaries and benefits. The biggest line items: public security (just over $1 billion, or 18 per cent of the budget), and debt servicing ($948 million, 17 per cent). Montreal’s snow-removal budget will rise by $3 million. In 2019, the city has budgeted $166.4 million. That’s three per cent of Montreal’s budget.
ROADS, WATER, PARKS
In addition to the budget, the city published its $6.5-billion capital works plan for the next three years. Expect more roadwork and water repairs. In 2018, about $436 million will be spent on roadwork. Over the next three years, the city expects to spend about $650 million per year on such work. Upgrading Montreal’s dilapidated water infrastructure will also be costly. In 2018, about $440 million is going to repairing water mains and sewer pipes. Over the next three years, the city expects to spend $528 million per year on such work. For both roadwork and water infrastructure, the planned annual expenditures amount to almost four times what the city was spending five years ago. The city is also setting aside more money to protect green spaces. It has budgeted $60 million over three years for the purchase of natural environments. That $20 million per year is more than six times the amount the city has recently been spending annually to buy land for green spaces, said Luc Ferrandez, the executive committee member responsible for large parks.