Municipal Taxes and Mill Rates, a Clarification

Monday, August 15, 2005 03:58 AM

Permit me to clarify the matter of who pays the biggest tax bill in BC.

I watched with interest recently as the matter received much attention at Opinion 250. The logic by one writer was that we may have a higher mill rate than say Nanaimo, but don’t pay as much in taxes, left me scratching my head.

The mill rate is set based upon $ 1000 dollars of value in a home or business. If your mill rate in the city is higher than Quesnel, Terrace, Prince Rupert, Nanaimo, Kamloops, Kelowna and so on, that is a fact.

The City Hall likes to use this argument to justify our higher taxes. Home prices they say are less, so consequently our mill rate must be higher. Now I could buy into that argument except they might wish or (any other person who holds to the belief) to explain to me this; a home in Kamloops costs, with lot, about $ 179,000 dollars to build today. Generally lot prices are about $60 to 70 thousand dollars, plus it costs between 110 to 150 for the home that is built on it. That is standard fare in every town and city I’ve mentioned or good old PG. So if someone builds a home up in College Heights this year and it costs (lot and building) $179,000 dollars, will they pay more in taxes than Kamloops?

Short answer, of course!!!

For your further information, places such as Terrace in fact have a lower mill rate and the average home sells for less than PG. Raise the issue with City hall and see how quiet it gets.

The comparison by City Hall is a bit like saying the reason gasoline is cheaper in Richmond is because they have to drive further to get to work on average than we do in Prince George. Or gas is cheaper in Ottawa and Toronto because its closer to where all the people live ( politicians included )

Spin it in any manner that you choose, we do pay higher taxes.

Now do the taxpayers mind if ,say for example, we also can boast about having the best roads in BC, or the best snow removal or the best street lights? You be the judge.

That, is one man's opinion.

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Posted on Monday, August 15, 2005 03:58 AM in Views by Ben Meisner

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Comments

Posted by: gypsy on August 15 2005 8:56 AM

Thank you, thank you, Ben. Some people are too "thick" to understand we do pay in excess, and we do not receive good value for our tax dollars. This city has never been one to have enough money coming in year after year, and they demand more and get more to squander.
So now I hear one of the "call" centers, which the city supposedly subsidized initially, is leaving, so job losses are inevitable.
Was it not another brainwave of Offets to have those call centers set up here?
Just what were the incentives???
Of course I know what the attitude of many of the residents will be. "Oh well, they were low paying jobs anyhow."
No harm done!!!! Not to worry-they did not stay long, so no jobs are better than low paying ones!!!!!People making $25.00 an hour scoff at any low paying employment with distain.
Lots of workers were at Foothills and North Nechako. Took a small army working for the City to put in a waterline. Tax dollars disappear pretty fast with a project demanding so many workers, and the city does "NOT" employ cheap labor!!!!
Heard a new golf course is going in behind Evergreen Mobile Home park. Anybody know about that one. Sure is getting bare looking anyhow!!!! I am certain it is not a "wheat field" as Bell would probably prefer.The disappearance of trees sure changes the landscape.
All the rumors floating around have piqued my interest.
Anybody with any news-let's have it!!!
Thanks again Ben for settling the property taxation issue. Needed that!!!!

Posted by: Opatcho on August 15 2005 10:20 AM

Anyone seen the big project at the top end of Massey Drive? They put in a drainage ditch three feet deep and about eight across at the top along the bottom end of the Ginter property. Extended it half way down the undeveloped portion of Massey, installed a dam across the ditch with a piece of 18 inch culvert in the opening of the dam . Guess where the waterwill will drain too? A surface grill in the storm sewer system across the road. A couple of rocks and a few twiggs and it s plugged.
The new paving of Ferry avenue from #16 West to the Fraser bridge is rougher then the old pavement was.
The value we get for our tax dollars is a crime. There is no quality control by the amateurish crew we have at City Hall. They keep Council busy on none issues and Council is to blind to see whats going on.

Posted by: owl on August 17 2005 2:07 AM

Kamloops and Prince George are very close to the same size based on population. The census population of Kamloops was 77,281 in 2001 while Prince George was 72, 406

In 2002, the total appraised value of all properties in Kamloops was $4.71billion. In 2004 it was $3.67 billion in Prince George. Thus Prince George’s total assessment was 22% lower than Kamloops. Given that the city budget for similar sized cities are probably close, (sorry, I have been unable to find Kamloops budget figures on the net, maybe someone else can) the assessed value of improvements in the city will be the key to the mill rate difference.

The residential mill rate was 8.62 for municipal purposes. In Prince George it was 10.52 in 2003. The mill rate, although they are one year apart, in Prince George is 22% higher than in Kamloops.

While the ratios of business, industrial, and other taxes to residential taxes will be slightly different in Kamloops than Prince George, the residential component is by far the highest and so the mill rate is a good indicator of the relative tax rates between the two cities.

Since Prince George was 6% smaller in size than Kamloops we should attempt to adjusting the assessed value of Kamloops improvements for size. Thus, a comparative value would be $4.43 billion. Based on that, the Prince George assessment is 17% less than Kamloops.

I believe the mill rate in Kamloops was increased in 2003, so the percentage difference between Kamloops and PG is likely closer to 20% rather than 22%.at percentage.

Putting that all together it looks like we might get a good match for the graph on the last page of the PG city hall site which shows taxes paid on a “representative” house in 8 cities. PG was $2,115 and Kamloops was $2,005, which makes PG base residential taxes 5.5% higher than Kamloops. When user fees such as utilities are added in the rates become $2,552 for PG and $2,641 for Kamloops.

I think this topic has been beaten to death and people will simply continue to believe as they have always, no matter how wrong it is.

Source documents.

http://www.venturekamloops.com/pages/kamloops/housetax.htm

http://www.city.pg.bc.ca/cityhall/committees/financeaudit/tax_rate_options_analysis2005.pdf

Interesting to note that the Kamloops City web page has virtually no information on taxes and budgets …
http://www.kamloops.ca/finance/budget/index.html

Guess that is what you get for paying less taxes …no service …

Finally, the lowest price lots I could find through MLS in Prince George are in the Hart at Gray Drive for $41,900 – 72’ x 132’, fully serviced. The cheapest I can find near Kamloops is in Campbell Creek, 15 minutes from downtown at 5,000 sf lot rather than a 9,500 sf lot for $51,400. The construction price of a new house will certainly be similar. It is the price of the land which makes the key difference between cities. And land prices in Kamloops have been higher than in Prince George.

Not to worry, our mill rates will be going down for 2006 by about 15% or so. But our taxes will be going up once more by 3% or so. Do I still hear heads scratching out there? ?

Here is the MLS site in case someone wants to hunt for one.
http://www.mls.ca/map.aspx?AreaID=1048