City will explore pipeline tax increase after public delegate points out loophole
Council informed there’s no provincial threshold stopping them from upping rate on pipelines
Hamilton will explore the possibility of a tax hike on pipelines thanks to an enlightened delegation at a budget feedback meeting Monday.
Council voted unanimously in favour of a motion at the end of the public meeting to research ways of increasing the city’s current pipeline tax, which has for years sat at a stagnant rate.
The motion was proposed after councillors heard an informative budget delegation from Adeola Egbeyemi.
The young project assistant at Environment Hamilton presented councillors with six ongoing, climate-related research initiatives at the non-profit geared toward reducing local fossil-fuel dependence.
Several councillors’ eyes perked up when Egbeyemi mentioned the city’s pipeline tax rate — unlike other municipal tax classes — has no provincial threshold, meaning municipalities have the authority to levee increases over them.
“Considering the negative externalities that pipelines bear on the community, as well as that they’re comparable to large industry, we think they should be raised ...” Egbeyemi said, noting that rate is the same as the province’s threshold for large industrial tax classes.
The city’s current pipeline tax ratio is third-lowest among eight property tax categories, which include classes such as industrial, residential and commercial. It affects utilities like Enbridge and generated around $4.9 million in municipal revenue last year.
While a pipeline tax rate hike would generate greater revenue for the city, the general manager of finance, Mike Zegerac, advised council the consequent offset would be a reduction in tax rates on other property classes.
“It’s not a revenue-generating opportunity,” he said. “It’s an opportunity to shift the tax burden across tax classes.”
The passed motion will see city staff explore how much a hiked pipeline tax rate would decrease other property tax classes.
Egbeyemi was one of 11 people to delegate before council Monday.
The meeting was the second this month that residents got to publicly voice their opinions about the budget at city hall. An initial meeting on Feb. 6 had to be adjourned after protesters filed into council chambers to rail against a proposed police budget hike.
A majority of those who spoke Monday also asked councillors to reject the $12.3-million increase to the police budget, arguing those funds should instead be allocated to other pressing needs like affordable housing, addiction services and public health.
Two delegates advocated in favour of the Care Fare initiative, which wants to make transit free for students 17 and under, anyone 60 or older, those on ODSP or OW, and people with a disability.
Two others from ACORN Hamilton asked council to further explore budget measures that would protect vulnerable tenants from landlords who neglect property standards and hike rent costs.