All cash-strapped Red Deer property owners gained a three-month deferral on paying 2020 municipal taxes on Tuesday.
In a more contentious move, city council also gave all building projects that are slated for completion this year a break from paying partial taxes.
During Tuesday’s city council meeting, in which everyone participated digitally from home, councillors discussed recommendations designed to ease financial stress on local residential, commercial and multi-family property owners who have lost revenue and work hours during the pandemic.
Council also discussed providing some incentive for new developments.
The measures unanimously approved by council bring municipal tax collection in line with previously announced provincial deferrals for 2020’s education taxes (which are rolled into the annual property tax bills).
The province has also pledged to keep the education portion of the 2020 requisition at 2019 rates — which means all Red Deerians will see lower property tax bills.
The recommendations that were approved by council are:
* To defer to Sept. 30 all municipal and provincial parts of 2020 property taxes for residential, multi-family and non-residential ratepayers from the usual June 30 deadline. The late penalty would be deferred until Oct. 1 (to align with the provincial due date for the non-residential education requisition).
* Payments of the 2020 business improvement area levy would be postponed to Sept. 30, and the late penalty will start on Oct. 1.
* No partial new property taxes will be charged to properties that are either completed or improved sometime during 2020. Their property taxes would start for the full year in 2021. This would cost the city up to $300,000 in new revenues, but is meant to encourage new construction growth, said the city’s revenue and assessment services manager, Joanne Parkin.
* No supplementary business improvement area tax would be charged in 2020 for properties that are either completed, or improved sometime during 2020. This is to encourage business development and businesses moving into the downtown.
The latter two are unique incentives that the City of Red Deer is trying. Parkin said to her knowledge, no other municipality is recommending this kind of relief.
The third suggestion raised some concerns about unfairness. Coun. Lawrence Lee initially questioned the equity of requiring a resident who finished constructing a property in December 2019 to pay taxes for all of 2020 on it, while someone who finished a project in January could save on 11 months of property taxes.
Coun. Tanya Handley also wondered how other property owners would feel about somebody getting 11 property tax-free months. But she and Lee both ended up supporting the resolution, saying they want to do all that council can to help motivate economic development during the pandemic.
Mayor Tara Veer saw it as a way of kick-starting economic recovery during an extremely difficult time, while Coun. Frank Wong hoped the move could lead to more city land sales.
Wong urged residents who can afford to pay their property taxes on time to do so, as the city is already facing a cash-flow crunch that will have to be solved by taking out a short-term loan or drawing from reserve funds.
Coun. Ken Johnston believes that exempting partial property tax payments for 2020 for new developments offers some measure of relief when it isn’t possible for the city to give all residents a break on user fees.
Veer said all city decisions might have to be revisited as the pandemic situation evolves.
lmichelin@reddeeradvocate.com
Like us on Facebook and follow us on Twitter