Sighs of relief at the review of recently received property tax notices are premature. Ratepayers should consider the amounts reflected in the interim bills sent out last week as deposits towards their final bills which will not arrive until June. Municipalities may only bill a maximum of 50% of the final amount of the previous tax year, which is how the interim bills are calculated. The reason for the delay is simple: of the four main factors influencing the final tax till, only one is currently available- the assessed value of each property as determined by MPAC.
At the moment, the only thing the Township Finance staff knows for sure is how the eventual total budget will be divided amongst the ratepayers, as assessment values indicate the proportion of the municipal expense each property owner will bear.
Only a portion of the amounts collected by the township are for its own use: our municipality also act as a collection agency on behalf of Peterborough County and the Ministry of Education. The municipal portion of local property tax bills is roughly half of their total, and last year the County received roughly 30% of the levy with the remaining 20% going to the province.
The MPAC values updated in 2016 will be incorporated into the tax bills over the next four years, with increases in assessments introduced in 4 equal amounts each year. Changes in the assessed values in the township have changed significantly according to the MPAC statements, with residential properties increasing in value by 17%, farm properties by 68%, industrial properties by 18% and commercial ones by 4%. Because these increases vary widely, there will be a shift in the tax burden amongst these different property types, but it will not be as dramatic as one might expect looking at these numbers.
MPAC assessments show that farm properties have appreciated four times more than residential properties in the township in the last four years. This phenomenon is province-wide, where the average increase in assessed values is 70% in the 2016 assessments. This has farmers and their representatives worried that they will begin to contribute more than their fair share to their municipalities to support local services like roads, schools and emergency services despite no increase in their use of these services.
This potential shift in taxes will not occur in this township. The municipal tax rate on farm properties is 25% of that applied to residential properties. As luck would have it, the 68% increase in farm assessments happens to be exactly four times the rate of increase in residential properties, so the relative tax burdens on farm properties compared to residential properties in the township remain the same as it has been in the last four years. Director of Finance Kimberley Pope provides a numeric demonstration of the change in municipal taxes on page 2 of her Draft 2017 Budget report which is available on the township website.
The next component of the property tax calculation will be determined by Council when the 2017 budget is finalized, which is scheduled to occur on Tuesday, February 21st in the regular Council meetings.
To learn more about the budget and provide feedback to your elected representatives, plan to attend the public meeting to be held Monday, February 6th at 7:00pm where they will review the 2017 Draft Operating, Capital and Water & Wastewater Budgets. KG
