Talking about the 2014 tax policy

Lisa
Lisa Goudy
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Coun. Don Mitchell, Coun. Patrick Boyle and Matt Noble, city manager, listen as Brian Acker, director of financial services, talks about the 2014 mill rate factors at the March 31, 2014 executive committee meeting.

Executive establishes higher mill rate factor for vacant commercial or industrial land

Vacant commercial and industrial land will have a mill rate factor 2.5 times higher than developed property of that type.

Executive committee discussed and passed a number of mill rate factors for the 2014 tax policy. The most-talked about issue was the establishment of a new sub-class for vacant commercial and industrial land and establishing a mill rate factor for that land.

“We did a review of all the vacant property that we have in Moose Jaw. In terms of commercial, there’s a significant number of vacant properties,” said Brian Acker, director of financial services.

“The reality is with those properties is they’re not being developed, haven’t been for a number of years and aren’t at this point in time. One of the realities of vacant land is it’s assessed at fairly low value. So the level of taxation is not very high. It certainly isn’t an incentive to develop that land.”

He said there are 141 vacant commercial and industrial properties in the city.

Mayor Deb Higgins said she believes the proposal could work based off of personal experience.

“Personally, we used to own a chunk of land. We held onto it for a long time … It was kind of a getaway. Taxes were a mere $180 a year. So it was like no big deal. It sat there,” said Higgins. “But once the rural municipality decided to increase taxes … we really started thinking twice as to whether to leave it sit there.”

But Coun. Brian Swanson said increasing taxes on vacant lands doesn’t make sense.

“If you think that in moose jaw there’s all kinds of vacant lots that are just saying, ‘You know, I’m going to hold onto this until it makes me rich’ as opposed to welcoming opportunity to build something on it that would make them money, dream on,” he said. “The fact that there’s so many vacant lands is indicative of the economy.”

He said a strip mall on Thatcher Drive East across from the new subway was completed six months ago, but is empty. He said the Town ‘n’ Country mall is three-quarters empty and downtown there are many empty properties.

“To increase the taxes on them in the idea that this will somehow spur them to make a bad economic decision, it doesn’t make sense when their property is of less taxation. I don’t quite understand the logic on this,” said Swanson.

But Coun. Dawn Luhning said the idea makes sense to her.

“Over the years I’ve had people say to me, you know why do people get to sit on this vacant land and not doing anything with it? Are they ever going to do anything on it? Is there something that happens there? “

Acker said no other cities in Saskatchewan have done something like this. Luhning said if someone doesn’t like this and has had a piece of vacant land for a number of years, maybe they’ll do something with it.

“To me, I say then let’s try it because let’s lead this versus follow everybody else,” she said. “That’s what we usually do is follow everybody else … to me, it’s common sense.”

Executive also approved establishing the mill rate factor for other agricultural land and improvements, as well as non-arable agriculture land and improvements, at 0.4239 and using the excess money collected from the 2013 commercial phase-in program to the commercial appeal allowance reserve as a way to offset possible future assessment appeal losses.

Follow Lisa Goudy on Twitter @lisagoudy.

Geographic location: Moose Jaw, Saskatchewan

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