Prior to delivering her statement on Bowen Islands financial future in the five years ahead, the municipality's Manager of Finance, Kristen Watson joked about being the unfortunate "barer of bad news." Watson told council that while property values have remained fairly stable, projected costs to the Municipality have gone up, and so her draft of this year's Five Year Financial Plan recommends an increase in property taxes by five percent.
Bowen Island's Community Charter requires that council approve of a five year plan by May 15th of any given year. This date takes into consideration the fact that property owners have until the end of January to challenge the assessed value of their properties, and the final roll value for all properties in the community is calculated in April. Currently, it looks as though the total value of all properties on Bowen has dropped $13.5 million, which is less than 1 percent of the more than $1.4 billion total value of properties on the island.
Watson says that while operational expenses in the new budget have dropped more than $80 thousand from 2013, an extra $188 thousand is needed to cover new expenses. Those expenses are divided up among increases in reserve funds for the fire department, renewal of the Library Reserve Fund (which the Municipality did not contribute to last year), and contributions to the new Municipal Gas Tax Fund. Watson says there are a number of other requirements and projects that could be added to the list of expenses: a new roof for the library (currently budgeted at $100 thousand); a communications budget for the municipality ($30 thousand); and a boat launch in Tunstall Bay (more than $700 thousand).
At the end of her presentation, Watson told council the Financial Committee wanted input about their willingness to raise taxes in order to cover these projected costs.
Councillor Tim Rhodes made a motion to approve the proposed 5 percent tax hike on the basis that tax increases and cuts were not made in previous years that should have been.
Councillor Cro Lucas replied that he preferred an increase of 3.5 percent or less in property taxes.
"We are looking at a year where they're talking about not inflation, but deflation by the end of the year, and I think it foolhardy to be going forward with something that flies in the face of convention."
Councillor Andrew Stone suggested a tax increase of less than 3% was more appropriate, given that neighbouring municipalities have kept their tax increases at a similar rate.
"This council promised to be a fiscally responsible council, over the past two years we've tried to meet that approach and we have to try to find creative ways to keep it down."
Councillor Wolfgang Duntz, acting as Mayor in the absence of Jack Adelaar, equated the continued increase in taxes to an indebted family continuously relying on a line of credit and stated that he supported a maximum increase of 1.5 percent.
"The bottom line is that we are not sustainable," Duntz told council. "There is not one community that can sustain itself without growth tax increases are bad for moral, because its so easy. Get your act together and work towards development, construction."
Earlier in the conversation, Councillor Alison Morse advocated a maximum 5 percent increase, and expanded on her reasoning based on Councillor Duntz's comments.
"In the past we had non-market increases that gave us a 2 or 3 percent increase in tax rolls, we really don't have these this year. Other communities in the lower mainland have an increase in construction and so an increase in their tax rolls. So it's kind of apples and oranges comparing us without looking at these two pieces"
The conversation continued for almost an hour and a half in total. In the end, Council decided that they required further details in order to properly answer the questions posed by Kirsten Watson and the municipal Finance Committee. The conversation will continue at the upcoming Strategic Planning meeting on February 3rd, and they will come to a decision at the February 11th Council meeting.
FACTS & FIGURES:
WHAT DOES A 5% INCREASE IN PROPERTY TAXES MEAN TO YOU?
If the value of your house last year was $550 thousand dollars and you paid $1500 in property taxes, if the value of your house has remained stable, a 5% increase in property taxes would increase that number to $1575.
ACCORDING TO BC ASSESSMENT:
- A non-waterfront single family home on Bowen which would have been valued at $454,000 in July 2013 on Bowen Island is worth $447,000 one year later.
- A waterfront single family home that would have been valued at $1307,000 in July 2013 is worth $1,341,000 one year later.
SINCE 2009, THE MUNICIPALITY HAS RAISED PROPERTY TAXES 1.5%EVERY YEAR. That money goes into reserve funds for the maintenance and replacement of capital infrastructure.
LAST YEAR THE MUNICPALITY COLLECTED
$3,665,210 from property owners in
tax revenue.
PROPOSED CAPITAL PROJECTS:
Library building roof - $100,000
Tunstall Bay Boat Launch - $570,000
Firehall- $3,000,000
Water treatment plant - $6,000,000
