If you are a property owner you will be receiving your property tax notice next month. Here is a link to the insert you will receive. This year there will be a 2.53% increase in the Area H requisition. In this article I want to explain the amount collected for Regional District Services, how it is collected, how the increase occurred, and lastly, what the property owners will pay.
First, let’s look at how amounts are collected. Regional districts cannot directly tax properties. Instead, regional districts requisition, by April 10 of each year, the Provincial Surveyor of Taxes for rural electoral areas (that’s us) to tax on behalf of the regional district. (The cost for this is 5.25%.) As well, as you will see on your Property Tax Notice, the Provincial Surveyor of Taxes also collects taxes for other items such as schools and police. These are not Regional District Services.
Now, let’s look at the amount to be collected this year. The total amount to be collected for Area H in 2021 is $1,356,851. The good news is this is a $7,504 or a 0.56% increase over the amount collected for 2020. (The details of how much each item changed compared to 2020 are in the chart below.) But at the beginning I mentioned there will be a 2.53% increase in the Area H requisition. So, if you are following me you should be thinking if the amount to be collected is 0.56% greater than last year then why is there a 2.53% increase? Just where does the additional 1.97% come from?
This 1.97% comes from the amount BC Assessment allocates to the different property classes. I apologize right now as it can get confusing – but here goes. There are a number of property classes and the major ones in Area H are Residential, Business and, to a lesser degree, Managed Forests. Overall, the amount allocated to the Residential property class increased from 65% to 67%. This increase of 1.97% plus 0.56% makes up the 2.53% increase for this year’s property tax. So, while Residential property class went up, Industry and Managed Forests property classes went down. This is an important reminder that what happens to one property class has an impact on the others. On another note, it is a bit of a silver lining that this small shift, during an economic downturn, should help our local businesses.
So how much will the property owner pay for Regional Services? The answer is for the average home in Area H (Some bright person calculated this to be $627,268) there will be an increase of $19.22. But if the question is how much you will have to pay? This will be detailed per 100,000 of assessed value in the insert that comes with your Property Tax Notice.
I wish it ended there but there is one more thing to consider. The 2021 BC Assessment of your property. If all the properties went up equally then I wouldn’t have to include this. But if the Assessment of your property goes up more than the overall average change of the property class (there was a 6.44% increase from 2020 to 2021) then the amount of property tax you pay increases. The reverse is true, if the Assessment of your property goes down more than the overall average change of the property class then what you pay decreases. This is very individual to each property, but something to take into consideration if your assessment comes in higher (or lower) than expected.
Ultimately, those that own property are paying for the Regional District Services. Some services are region wide and some services are local. Some are determined by the province, some by the regional district, and others by the Electoral Area. This year I would like to involve the community as much as possible during the budget process. This will happen in the fall and I look forward to hosting a series of meetings as the CVRD budget planning unfolds.