With Industry Gone, Tax Burden Falls on Residential

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The average residential tax increase has been six percent, until this year. With industry gone, the town has come to rely increasingly on residential taxes and utility increases.

By Gagandeep Ghuman
Published: April. 6, 2013

If ever there is a good time to get nostalgic about Woodfibre and Interfor and B.C. Rail, this is it.

As we further devolve into a bedroom community, residential taxes will continue to have to make up for lack of industry.

Compare 2000 with 2010, and the nostalgia for industry will gets disquieting.

In the year 2000, residential taxes accounted for 48.6 per cent of the tax revenue, while major industry contributed 28.52 per cent of the tax revenue.

Fast forward ten years, and the equation has changed.

In 2010, residential property taxes brought in 59.2 per cent, while major industry (port), brought in 2.10 per cent.

If you remove the port, then contribution of major industry was zero per cent.

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The contribution from heavy industry is close to zero, if you disregard the Squamish Terminal taxes.

Zero per cent.

In 2010, municipal tax revenue generated by residential was 59 per cent, while Industrial and Light Industrial was 4.4 per cent.

Out of this, the Squamish Terminals alone contributed 2.1 per cent.

Now, if you think residential is unfairly picking the burden for industry, consider this:

On a per capital basis, the average Squamish resident pays about 8 per cent more on taxes and user fees than the average British Columbian.

On average, Squamish citizens pay $1,760 per year, while BC residents pay only $1,625 per year.

This is an admission the district itself makes in its 2013 financial plan.

It notes: “A decrease in the industrial tax base over the last decade has resulted in business and residential customers paying a larger share of the total tax bill than was historically the case.”

The financial plan also has a suggestion that councillors could fo well to take to heart: ‘To prosper, Squamish will need to continue to attract new business investment.’

Mindful that the it can’t dip into accumulared surplus every year, the council has agreed to fund the approx. $1M projects entirely from tax revenue this year.

This change will increase the effective tax rate to 10.1 per cent in 2013, a considerable increase when you consider the fact that average tax increase has been closer to six per cent. (See graph at the beginning)

Yes, any councillor will happily tell you, policing cost and infrastructure projects have pushed up the tax increase.

That is true, and yet that shouldn’t be used to obsucre the fact that we are increasingly dependent on our residential tax base for revenues.

It’s time the council–and particularly economic development commitee and Dan McRae– look back at the industrial past and try to find a way to bring it into our present and future.

 

 

Comments

  1. Alexandra Suhner Isenberg says:

    Economic development has supposedly been a priority for Squamish for some time, but I’ve yet to see any progress. How long are we going to have to wait before the government actually brings some industry (and MUCH needed jobs) back into this town?

    • taylor192 says:

      Government cannot bring industry back, statements like that result in more of your tax dollars being spent unwisely.

      Industry has left for a reason, figure that out first.

  2. Jason Bechard says:

    This just goes to show why many ‘bedroom communities’ cost a small fortune to live in and why only the wealthy often live there. Without industry the DOS will have no choice but to raise taxes on home owners to keep the infrastructure working at least bare minimum. The sewage plant needs some major upgrades and the water system is leaking like a sieve.

    I think the taxes should have been more than they were personally and was willing to pay it as well. Now the citizens of this community are going to see that the environmentalist, while having good intentions, will destroy a community if their policies dictate who lives and works in their communities.

    We are not Whistler and there is no way in heck that simple bike trails and hiking is going to keep the infrastructure from being one flush away from total failure. Every community needs industry or it will fail…thats just reality. Like it or not.

  3. Jeff Norman says:

    News flash, this isn’t an industrial town anymore – get over it. By nature, industry and the industrial jobs that go with it move from time to time its happened all over BC and the rest of Canada and there is very little that an District Economic Development Committee can do about it. People looking for jobs in these transient industries have to either move on or adapt and take solace in the fact that the air they breath is a little cleaner. There will be small and large industrial proposals for this town from time to time and their overall benefits to the community should certainly be looked at; but the industrial centered past of this town isn’t coming back and there a lot of people here that are happy about it. Gagandeep I think this story would fit better in the oped section of your paper – it crosses the line between objective reporting and opinion.

  4. Dave says:

    I agree with Jeff to some extent BUT the responsibily still lies with Council to encourage light, non polluting industry with expedience and to cut any blocking red tape as much as possible.
    All the people who live in single family dwellings on larger lots should be prepared to pay more for this privilage.

    • taylor192 says:

      That is laughable to think any light, non-polluting industry will want to pay the premium to setup in Squamish. The port and associated resource industries are the best bet for Squamish, yet they pollute. Tech, financials, … and other non=polluting industries will not be setting up shop in a remote community with high cost of living and a small talent pool to pull from.

      The residents wanted to be a environmentally friendly tourist destination without realizing it costs a lot to do so. Welcome to the hell you created.

  5. TCee says:

    Industry per se is not the only economic driver, yet the emphasis seems to be a call for a return to past types of industry that were smelly , polluting, and costly healthwise. There are so many types of non-industrial businesses or economic drivers that could be attracted to this town (and could contribute to the tax-base) IF we had councils that were visionary, imaginative, open-minded, and able to put together 10-year economic development plans. Numerous economic/business ideas have been submitted to different councils by knowledgeable, local citizens but have typically been ignored. Meanwhile, our illustrious councils have indulged themselves and their special interests with many frivolous, and costly, projects that are “nice to have ” but not really needed in terms of core infrastructure and services. Money has literally gone down the drain. They have given themselves raises (33%?) in their first term without consulting with the public. (This is tantamount to Gordon Campbell’s HST fiasco.) When will they give themselves the next raise? They have expanded staff numbers unnecessarily in light of Squamish’s financial woes, while substantially increasing staff salaries (plus benefits), especially senior management, far beyond that warranted by Squamish’s size. ( The excuse that they can’t get “good people” without exorbitant salaries is nonsense.) Other communities have managed to keep their residential tax increases down, in some instances way down (Whistler @ zero % for 2 years; Pemberton @ 2%; Surrey @ about 2-3%; etc., etc.). Perhaps Council needs to ascertain how they do it – one way is keeping a lid on increases in staff and management numbers and salaries; another way is not funding anything that is not absolutely necessary – concentrate on essentials like sewers, water, dikes, policing, etc.; another is treating the budget like a household budget – if you don’t really need it and can’t afford it, you don’t buy it. The 10% tax increases, with more to come in the next 2-3 years, are irresponsible and unconscionable, and put an especially heavy burden on young families starting out and on Seniors on fixed incomes (That’s a laugh! Those incomes are declining rapidly, with higher taxes and inflation, to the extent Seniors can hardly afford a “treat” of coffee at Tim Horton’s.) As hard as it might be, perhaps Squamish’s Council should adopt a Paul Martin, a Maggie Thatcher, or even a Nancy Wilhelm-Morden approach to Squamish’s finances, budget and taxes. And stop assuming that local taxpayers can keep on paying higher and higher Local, + Provincial, + Federal taxes. The more the 3 levels of government dip into our single pockets with their declining dollars, the less we can support local businesses with our money, by buying their products and services.