Oh, to be a fly on the wall at private municipal council meetings this fall.
We’re in for substantial increases in our property tax assessments, and some elected leaders must be foaming at the mouth, anticipating all of the possible extra income. Well, not really. If the past is any indication, the wise ones will weigh the burden of overtaxing us and choose to lower the mill rate enough to lessen the pain.
The Municipal Assessment Agency, which handles communities except St. John’s, aims to send out its notices the first Monday of October. The capital city hasn’t finalized its exact date, but the assessments will be in the mail soon.
The statements for the 2013 taxation year will be based on property values on Jan. 1, 2011 — in simple terms what a property might have sold for back then. That’s probably a good thing. Chances are most properties are worth even more today.
Preparing the assessments is complicated and involves research on sales information and new construction. Everything from the size of a house to its age, lot size and neighbourhood are factors. Naturally, renovations and upgrades play a role.
A spokeswoman for St. John’s City Hall couldn’t tell me what the average increase in value will be; neither could the Municipal Assessment Agency for the areas it covers.
Individual councils have been given some preliminary numbers because they are already in the process of figuring out budgets. Early estimates give them something to work with. A quick chat with several councillors in the metro area confirmed that we can expect increases in the range of 40 per cent, some more, some less. It doesn’t mean our taxes will go up that much, but prepare for sticker shock. The assessments will be a little closer to the values that we see in the real estate market.
I grew up in Georgetown, at the time a middle-class neighbourhood with colourful two- and three-storey houses, many of them attached buildings. The area has undergone something of a renaissance.
My old homestead still has the magnificent view of The Narrows, but there have been numerous add-ons, including a glorious deck. Naturally, prices have gone up accordingly and the demand for downtown upscale housing has certainly helped. The real estate listings have become excellent reading for people like me who wonder what could have been. Houses on Queen’s Road, Parade Street, Hayward Avenue and most of that part of town are selling in the $300,000-plus range.
I moved to the suburbs years ago. The house I purchased for $150,000 would likely now sell for almost twice that. The assessed value last year was $201,000. I’m led to believe it will be closer to $280,000 for 2013.
The Municipal Assessment Agency says the last time they did this exercise, property values increased by about 28 per cent. We’ll see at least that on average this time around. The final tax bill will be made up of the tax rate times the assessed value. One thing is sure, we won’t be paying less.
Now, I know the cost of servicing our towns has gone up. We expect more for our tax dollar, everything from new pavement to improved recreation facilities. However, most of our incomes have not kept pace with what has happened with property values. Seniors and low-income earners can’t afford a tax hike, and even those in the middle of the income scale will be hard-pressed to pay more. The increased assessments aren’t windfalls, and municipalities still need help from other levels of government to keep services and infrastructure at an acceptable standard.
In the end, taxes become a blame game. There is only one pot of money — us — and there area three hands — the federal, provincial and municipal governments — reaching into our pockets for their share. Our only defence is the ballot box.
Councillors in municipalities should be mindful 2013 is an election year, and voting day is only 53 weeks away.
Gerry Phelan is a journalist and former broadcaster.
He can be reached at firstname.lastname@example.org