A proposal to slowly lower country residential taxes through money generated from new builds north of the river came under heavy scrutiny at city hall, but managed to squeak by its first hurdle Monday night.
The recommendation would lead to a lowering of the mill rate on properties in and around Nordale to match that of the RM of Buckland. The current 27 per cent difference is said to be driving people out. For example, on a $315,680 property, a city tax bill would be $2,916.50, while the Buckland rate would be only $1,922.49.
According to Mayor Greg Dionne, who was passionately in support of the move, the change would spur growth and create a tax level that is fairer to the services residents in these areas receive.
“I have talked to developers who have property out there and they can't sell them because of the difference between taxes,” he said. “[Buyers] can go across the road and save $1,000.”
Citing an early report, lowering the tax rate for these properties would short city coffers around $189,000. In order to lessen the blow, the change would be phased in as the city sold property in these areas. Any new builds would be taxed at the Buckland rate.
Around 40 properties would need to be sold to depress the taxation level. This would occur until the rate was equal to the amount in Buckland.
Dionne backed his support for lowering the tax rate by highlighting how these residents are on well water and septic tanks and have no access to the landfill.
“They don’t have paved roads or sidewalks and ditches… or equal access to services,” he went on to say. “I have heard them for years and I think this is a reasonable solution. I think if we can pass this we would see construction.”
Nordale Coun. Terra Lennox-Lepp expanded on this, saying as the residents are on water wells, “they can’t have a water main break, yet their property taxes go to pay for things like that.”
Others around the table, however, were more skeptical of the move.
Coun. Dennis Ogrodnick’s main point of contention surrounded the education levy on tax bills.
“You would think the RM would have a huge education portion as to educate a kid in rural is ten times the cost of a city,” he said, saying city dwellers must subsidize rural education cost heavily and believed that is where the “difference should be made up.”
While councillors Ted Zurakowski and Blake Edwards were initially doubtful, both eventually came around to the idea.
“[They can move] one or two clicks away, not far, and their taxes are less,” Edwards said. “I want people to pay taxes to the city of Prince Albert.”
In a tight 4-3 vote, the motion passed and will come to a future council meeting for further consideration.
On Twitter: @JournoMarr
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