At the regular Council meeting on Monday, MPP David Piccini reported on what was happening with a number of Provincial programs and how they affected Cobourg. As shown on the recently approved budget, the Province provides close to $1M of Cobourg’s revenue – much of that is jointly with the Federal Government which provides another $1.6M. The big items are Cobourg’s request for funding for Harbour repairs plus the ongoing hope of funding for the Victoria Square Project which has been on hold for a few years pending such funding. David also reported on a number of smaller grants plus he spoke briefly about the Provincial Project to improve MPAC which provides all property assessments in the Province – these are used in deciding how much tax each property in billed for.
OCIF – Ontario Community Infrastructure Fund
This year, Cobourg will be getting $638,141 which is up 55% on the last two years. This is intended to be used for roads and bridges and in fact will be used for the Mathew Street reconstruction. David emphasized the predictability of this fund which implies we’ll get more next year!
Municipal Modernization Funding
For service delivery reviews.
An application was accepted for a joint effort with other Northumberland County municipalities to review how the efficiency of Fire Services could be improved.
ICIP – Investing in Canada Infrastructure Program (shared with federal Government)
CCR – Community, Culture and Recreation Stream
Note re Transit Stream: The Province has selected 350 projects and forwarded them to the Federal Government but they have not yet announced recipients. Cobourg has requested funding for a replacement Transit bus from this stream.
Cobourg submitted two applications – one for the Victoria Square Project (total project cost $1.65M) and the other to repair the Harbour’s North Wall, East Wall, West Breakwater and East Breakwater (total project cost ~$10.6M) – the total requested by Cobourg was $12.25M. There were 1100 requests for projects across Canada – the most in the program’s history. Cobourg was the only municipality to submit two requests and since not all can be approved, it’s unlikely we will get approval for both our asks. Decisions on who will get the grants are expected “as early as summer”.
Security and Prisoner Transportation Grant
To offset some of the costs of Court Security and Transportation. This year Cobourg will receive $72,028.
ROMA Rural Ontario Municipal Association
The Northumberland Community Para-Medicine program has been approved.
Property Assessment – MPAC
Improvements are planned in accuracy, transparency and stability. The process will include inputs from the public.
In a separate announcement, the province is proposing to have a single list for voters for Provincial and Municipal elections instead of using a list from MPAC for Municipal elections. The list would be managed by Elections Ontario. The change requires legislation which has not yet passed.
Hopefully, Cobourg will be awarded the larger amount of the ICIP requests since it’s more urgent and would avoid local taxes having to cover the big capital expenditure on the Harbour in 2021.
Links
- Piccini’s Presentation on You-Tube (may be removed in 3 months)
- Video on You-Tube about the Voctoria Square Project
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That is good news about the proposed change to have Elections Ontario manage the Municipal elections voters list rather than MPAC.
I conducted a small test of the system when I found a class-mate’s name listed at their old address in 2006. (Municipal election candidates have access to the voter list during election periods, in case anyone is wondering) It took nearly three full municipal elections cycles (about 12 years) to get a revision to the list, despite the fact the person in question had not lived at the rental address for almost 15 years already from first notice. This may have happened because the person did not ask for the correction (they had long moved out of town), or, the landlord did not bother to update information to MPAC, or, a notice of voter list error from an election candidate may be temporarily set aside during the election period, or, somehow someone along the way ‘dropped the ball’ and the error in the listings remained. What it meant, however, was that a voter card was issued and likely delivered to the address. I believe the error was fixed by 2018’s municipal election.
Great news about input from the Public about MPAC ….. good luck …. hopefully these sessions will be broadcasted in our local media and also from our MMP office. Hopefully we can provide our input online without having to attend sessions in TO. It would also be great to hear more from MPAC about their suggested improvements and shed some light on how they assess today.
Forgot to mention that with Arnona ….. renters also pay realty taxes …. with this system the rich benefit again based on your points Paul.
Short-term renters are exempted. However, given that renters pay the tax directly rather than the landlord who recovers it as part of the rent, I don’t understand your comment that the rich benefit again. Who are you classifying as being rich?
Thanks Ken – I have had trouble understanding the difference in rates on new sales. When I learned the new townhomes were being charged $6000 property tax I asked a friend who had lived here for 5 years then and purchased at $250,000. Their home was fully detached and would fetch about $400,000. on re-sale. They were currently paying $200 a month as compared to the $500 on the new townhomes. As a prior home owner we were assessed at $100,000 by MPAC below what our house sold for. It would seem MPAC needs a re-boot.
Basing taxes on property values seems perverse. It has little to do with ability to pay nor the value of town services received. A senior may own an expensive property (perhaps inexpensive when purchased 30-60 years ago) but use few town services and have little income with which to pay taxes. A young couple may have several children using schools and recreation facilities but they will pay much or little depending on the size of their house rather than their usage of services. A more equitable system would be a per capita tax coupled with a tax on road frontage or other measure reflective on the town’s cost to service the property. Add a means test if essential. Alas the current system is probably too ingrained for any changes.
BTW, Observer, was the assessment $100K below market value before or after the sale? I believe that MPAC updates assessments soon after a property is sold.
Hello Ken –
The tax rate remained at a value for many years with some increase but not much. The house sold for $100,000 more than the assessment. By-the-by the new owners renovated and modernized within a year they sold it for $300,000 more than they bought it for. But by the then the market has hit its upswing and I see similar houses after the upswing are now selling for a further $100 to $150,000 more.
I think that we all have stories of taxes and selling at the wrong time. I sold my 1200 sq ft, 2 BR, 2 Bath Toronto condo (corner of Bay and Wellesley) for $279K in 2003. An identical unit in the same building is currently listed for $988K with 2019 taxes of $3,365.87. My 2002 tax bill was $2,185.54. See https://www.realtor.ca/real-estate/21347513/1311-24-wellesley-st-w-toronto-bay-street-corridor
Why the down vote? Reported what the house sold and re-sold for. Didn’t offer any form of opinion. Some weird people reading here.
The best improvement the government can make to MPAC is to put it out of its misery.
There is no sane reason why what we pay in property taxes should be based on what my real estate agent thinks its worth. A more viable option would be to replace property value with square footage as the assessment base and move the cost of many government services away from an ad valorem system. Tax policy should be established through tax rates.
No more annual fluctuations in the assessed value. Using square footage, the assessment remains stable until the dwelling is made bigger or smaller. An army of MPAC appraisers would no longer be required.
Cheaper, stable and fairer.
What’s holding the government back from introducing real change that makes sense.
Agree with Paul to a degree but you also have to consider property size and location …. is it a waterfront property vs condo etc…. MPAC is not properly assessing values of older homes unless they gain entry to establish the value other than thru current sales on the same street. It is easier for MPAC to assess value of recently built homes/condos as they just need to collect the sales brochures and punch in the numbers ….. I think that MPAC is not doing their job …. my Mom who lived in Etobicoke had a home valued at over $1 million yet her taxes were lower than ours in Cobourg for a home valued at over $500M …. go figure …. never heard of MPAC prowling the streets of the Kingsway …. wonder why?
An assessment system based on square footage instead of property values is not new. Israel uses what they call the “arnona” tax, which is based on square meters and falls under five broad categories.
• Property excluding the street
• Buildings
• Agricultural land
• Land that is occupied
• Building land
All five categories have different tax rates. Your concern about lot size would be dealt with by a separate tax rate for land vs. building. The issue you raise of location (i.e. lakeside properties) has no place under the assessment system. Instead, it more appropriately would be dealt with as a matter of tax policy in the rates approved by Council. If Council chose to tax two identical homes – one lakeside and the other in Town – differently, it would have the ability to make that decision.
MPAC currently employs 1,700+ people, manages 5.3 Million properties and costs $223 Million to operate a complex assessment system that is based on property values and is forever changing. It’s a system few people understand and has no connection to the municipal services each property consumes.
All of this could easily be replaced with a minimal cost, accurate and stable system simply by using square footage as the assessment base. As I said previously, tax policy should be determined solely through the rate and not intermingled with the assessment base. Furthermore, it would eliminate politicians trying to blame tax increases on annual re-assessment and would hold them far more accountable to spending decisions.
Governments need to become smarter and more efficient. Things don’t always have to be complicated and costly.
Paul, your suggestion seems reasonable but what would be the justification for a lakeside property having a different tax rate than an otherwise identical property?
In my view they should be the same. The fact that one is lakeside and its twin is, say, in New Amherst doesn’t justify different rates. The services each receive are identical and where they differ, such as public transit, the specific service could be area rated.
The point I was trying to stress is to keep the assessment base pure and don’t distort it with what are tax policy considerations.
Council should establish tax policy through the rate structure. They could decide to set the same rate for residential or multi-residential or to set a rate for industrial designed to retain and attract new industry.
If property owners are unhappy with how the tax rates are calculated or applied they can then lobby their elected Council for change or reduce spending to an acceptable level.
It’s a great topic that merits further examination and public input. It would be a shame if the positive benefits were ignored when the opportunity exists to think outside the bureaucratic box.
Paul it will be hard to understand how a property owner with lakefront property on Lakeshore Rd pays the same as someone in town with the same square footage …. agree that the MPAC footprint empire needs to be examined more closely …
I’d be interested in hearing why you think the lakefront property should pay more in property taxes than an identical property downtown or, say, New Amherst.
Again this should have absolutely nothing to do with the assessment base. That would be a tax policy decision by Council reflected in the tax rate.
MPAC – With the upsurge in real estate and re-sale prices it puzzles me that homeowners receive very little in the way of tax increases. People in Cobourg that purchased at $250,000 a few years back have experienced only minimal increases yet their home is now worth $400,000. New home purchases at $400,000 are taxed much heavier. Townhomes along the street at $397,000 were paying $6,000 while the first are paying $3000. Anyone can clarify for me?
One part of the puzzle is that MPAC assessments are updated on a four year cycle. Any increases are then phased in over four years. My tax bill has certainly increased and is close to double what I paid 10 years ago.
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