First off, congratulations to the new (mostly returnees) council and new Mayor on their victories, thank you for stepping up and serving our city. I am grateful we have such a diverse group with a good mix and look forward to the next four years.
The purpose of this letter is to begin a conversation about an issue, I believe, needs to have a light shone on it.
During this election many of the council potentials were asked about city infrastructure. The most common answers had to do with how important our recreation, roads, sewer and water were but I never heard anyone discuss the business core.
A solid business core is vital? Without a strong business section the city struggles.
A few years ago all municipal governments were caught with their pants down so to speak.
The Province decided to change the way they distribute their tax revenue in an effort to procide a better financial base leaving this city and others caught unaware. There was little advance knowledge and the local budget had been pretty much decided. Local taxes were going to go up and there was little one could do about it.
In addition, this was the year the Sask. Assessment Agency updated commercial property raising the values, in a lot of cases, considerably.
That year commercial taxes went up, way up. In the building I occupy, taxes went up 75% year over year. Upon calling the City I was given the explanation and was told I was lucky, some businesses had their taxes go up 200%.
If you owned a residence and your taxes increased 75% what would be your reaction? Yet, my residential went up because of this situation, but no where near 75%.
Council decided to hold the line with residential taxes and gave little consideration to the new burden placed on commercial properties.
Now, I get that the City has no say in these assessments but the city does create the mill rate.
According to city hall there are about 6,000 residential properties that pay about $1.4 million in taxes compared to about 600 commercial properties that pay $1.1 million in taxes. (I am using rounded numbers.)
The commercial business sector shoulders the tax burden by paying almost 45% of the total property taxes. (Observe please, how many properties that’s split among.)
I know each commercial property may have more than one business that shares this amount, that is a fair point, but that sector one way or another still pays for it. Even if the building is vacant...the taxes are paid.
Case in point: the building I occupy pays over $20,000 per year in city property tax. My portion (1250 sq. ft.) costs over $5000 per year.
Yeah, I get it, it is easier to gain extra revenue using commercial properties and receive little push back than raise residential taxes and anger 6000 households. Any politicial would figure that out. I also get, commercial properties can deduct the amount from their taxes, little comfort when there is little profit.
I do take issue with the commercial assessments by the province; the value created by the province are based on the commercial values at a time when commercial property demand was high, perhaps the highest it has ever been in Yorkton, creating a perfect storm. It is certainly not like that today.
As I have said, the business core is essential to a strong city and even before Covid businesses were challenged.
The purpose of this letter is not to point fingers but to spark convesation. Attention is needed. Right now, business is as challenging as it ever has been. Just note all the “for sale” and the “for lease” signs throughout the city. This should serve as a warning.
In the over 20 years I have lived here, I have never heard of a small business revitalization plan put forth by the city. I do hear about projects like roads, sewer, a new city hall, round abouts, skating rink, etc.
Yorkton enjoys a surring area of around 150,000 people. This is unique and many come to this city to shop. This gives Yorkton a competitive advantage in attracting more business. Taxes are often a factor; indeed some businesses choose to locate outside the city limits because of tax considerations.
Here is a fact; the more businesses we have the more taxpayers we have, the greater the money we have for recreation, hospital equipment, roads, sewer projects, perhaps a new city hall and more.
As Council prepares for the new tax roll, don’t ignore the stress your business community is in.
The City needs to lead (this year of all years the status quo cannot be accepted:. The City needs to come forward wth creative solutions that fairly shares the tax burden among all and encourages small business growth.
Our city will be better for it.
Doug Henheffer BC-HIS
Hearing Centre, Ltd.