Your Property Taxes versus Your Property Value

I got an email last week from a person who's concerned about their property taxes and what happens now that many of us are suddenly living in houses worth approaching a million dollars. Houses we sure did not pay a million dollars for! 

If your house is now valued at a million dollars, but currently assessed at 300,000, does that mean you're suddenly going to have to pay three times as much in property taxes? 

 

Happily, no.

 

I thought maybe the person who wrote me isn't the only one with this specific concern, so here's what I wrote back (and I checked it with the Treasurer, so it's legit): 

 

I can guarantee you, you’re not going to have a doubled tax bill if your house is suddenly worth twice as much. Property taxes work very differently than sales tax or income tax. 

Here’s how Collingwood’s budget process worked the last two years that I’ve been on Council: The Treasurer and other staff come to council with a rough number of how many dollars the town needs if we’re going to continue offering all the services we currently have. Then, we councillors send the staff away with another rough number: what we’re willing to accept as an increase or decrease in spending. After that, staff return with a proposed budget, which incorporates Council’s number and any new or additional services the council has told them the town needs or wants. We debate and discuss, cut some stuff, keep some other stuff and then, that’s the budget, and the tax rate flows from there.

Last year, the final number of dollars needed came to around 30 million raised from property taxes. Here’s the important part: The approximately 30-million is then collected from among all the taxpayers, based proportionally on their MPAC assessment. 

(Just fyi, the town’s whole budget is actually about 100-million dollars, but the rest comes from other sources, like the feds and province and interest and fees and Development Charges.)

(To add another complication, the town collects your taxes on behalf of the County and the School Board, so, if your tax bill is 5,000 dollars, only about 2900 comes to the town. The County and the School Board set their own taxation rate, which the town has no say in. This year, the County has set a target of 2% for its increase. The school board is likely to have a small decrease. (I may have already heard what was in their budget, but I can’t remember offhand…))

Collingwood taxpayers have seen lower than cost-of-living property tax increases the last several years (about 1%), because of how many new people are moving here. The Treasurer can’t know exactly how many new properties will start getting tax bills each year, because of delays in construction etc., but the Treasurer does come up with an estimate, with help from the building and planning departments, and includes that estimate in the total number of dollars to be collected. Some years, the estimates are a might bit conservative, and we end up with a surplus that we put, by policy, into reserves. Some people don’t like this policy. 

Wow, that was a really long answer to your question, which was, ‘has there been any thought put into this?’, and the shorter answer is a definite, ‘yes’.  Lots of thought, for sure. You can rest assured your property taxes will not double even if your house price doubles, because everyone else’s house price is also going up, and the property taxes are based on the town’s needs, divided among all the taxpayers, proportionate to the value of their property.

 

So, if you, like me, are planning to leave your house 'feet first', I hope this clarification helps ease your mind a little. Oh, and a further clarification: the town does actually have a say in the County's taxes since we send two people to County Council: the Mayor and Deputy Mayor and sometimes me, since I'm the alternate. Also, the Treasurer tells me MPAC offers input for the estimates of new homes in town, while tax policy advisors hired by the county additionally give the town's Treasurer input on the estimates.

Water Triage

I read a document over the winter that scared the living daylights out of me. 

It’s the province’s Draft Triage Protocols for Covid 19. When there's a certain number of COVID patients in the ICUs, teams of doctors will make decisions about which newly arriving patients get care. If two doctors agree a patient has an 80% chance of being alive a year from now, they get the care. There are two other levels of triage involving whether a patient has a 50% or 35% chance of survival. When there are huge demands and limited resources, rationing is required and hard decisions have to be made, no matter how we got here or how awful it might seem.

We made one of those hard decisions last night at Collingwood Town Council. There are quite a few people who are disappointed in the vote to bring in an Interim Control Bylaw, and I don't blame them one bit. 

I’m disappointed, too, mostly that such a move was necessary. But I believe it was necessary and that’s why I voted for it, even while feeling nauseated and frustrated and appalled. Hopefully, the communications from town hall on this issue will lead to a better understanding for everybody.

The hard fact is, we don't currently have enough water to supply all the development 'on the books'  between now and when we fill the tanks at a new water treatment facility. 

For reasons I don’t entirely understand, we didn’t find out until early this year that during the winter months, Collingwood's water treatment plant can only make around 20,000 cubic litres of clean water per day. In summer, the plant can provide more than 31,000 litres. Cold water doesn’t take up chlorine the way warm water does and there were warnings about it in staff reports in previous years, but it wasn’t until very recently that this new calculation was completed and verified by the Ministry of the Environment. We knew capacity was less in cold weather, but we didn't know by how much. Now we know.

It's a new number. It's new news. I repeat: it’s a new number. 

There’s been talk of replacing the water treatment plant for a long, long time, but it just didn’t get built for ... reasons. There were even designs made and approved, but not built.

One of the very first council votes I was part of, in January of 2019, was to go ahead with the first steps -again- toward building a new water treatment plant. There were concerns about capacity articulated at the time, but we definitely thought we were on track to continue meeting all water needs until the new plant would open, sometime in 2025. It was going to be close, but there was a dovetail imagined where the number of new homes and businesses would grow, and, just in time, we would have that new plant ready. 

This new calculation means we’re about four years off. If all goes well, we -maybe- can squeeze out enough water supply for a total of 1048 new homes and businesses in the interim, but only in the best case scenario, which is if we cut some of the supply to New Tecumseth and use extra chlorine in the winter. We can get more if we build an add-on tank to treat extra water, but that's going to take about two years to install.

I voted to make the best of a terrible, horrible, no-good, really bad situation. If we can supply only 1048 units before the plant comes online, I want us to be thoughtful and deliberate. I want us to make choices in the best interest of the community rather than letting the chips fall where they may, since the way planning works, water allocation is first-come, first served. 

The only way to definitively take control of the hoped-for additional water supply is to bring in an Interim Control Bylaw. You’ll notice the first word is INTERIM. Short term. Plans and proposals can still come to town hall and go through the planning process. The ICBL is the only instrument we have, though, to prevent the final step, a building permit, because the rules say we can’t give a building permit without water to service the build. 

I got accused this morning of taking the ‘easy way out’. Well, there was no ‘easy way’ here that I could see. It's easy to say we could just turn off the water to New Tech and keep all our supply. I somehow doubt it would be easy to cut off the water to the family in Alliston whose sink and bathtub and washing machine use water from Collingwood.

It's easy to say we could just add more chlorine to the water. We’re allowed to have up to 4mg/l of chlorine in our water. It’s not easy to swallow that much chlorine, though, since it tastes and smells terrible. A higher level of chlorine is also not easy on the equipment at factories or your clothes. A higher level of chlorine is also not easy on the equipment at the current water plant or the workers who are putting it in the water. 

It would have been easiest if we'd built a new water plant several years ago. I love this idea! I wish earlier councils had built a new plant. I also wish all the repeated rounds of negotiation with New Tech had been fruitful. I wish someone had done this calculation sooner. I wish we weren’t in this pickle. As my dear departed dad used to say, “If wishes were fishes, we’d have lots to eat.”

What happens now? Well, among other things and in no particular order:

• You can continue to trust the safety of Collingwood's water.
• The projects that have building permits in hand will go ahead. 
• Projects that don't yet have building permits will continue the process up until the final steps.
  
• Some people will not get to move here when they were expecting to, which will make some people happy and some people angry.
  
• House prices will rise, which will make some people happy and other people angry.
  
• People will still renovate, including bathrooms, decks and additions. 
• You will fill your pool if you have one, otherwise, you will join me in the lake.
  
• We will put out a request for proposals in the next couple of weeks for a new water plant, and build it as soon as possible. 
• We will add a little more chlorine to our water sometimes.
  
• We will try to take back some of the supply to New Tecumseth and Blue Mountain. 
• We will install a separate tank to treat some more water. 
• We will start a process to decide which projects get the scarce water we can supply, (the maybe1048 and possibly more)
• We'll be asking for your help making the list mentioned above. (Should affordable/attainable housing projects be at the top of it? Maybe start thinking about that.)
  
• We’ll continue work on our Official Plan, making decisions on what kind of town we want to be. 

I sure hope the weather is nice for the ribbon cutting on the replacement water plant, and I truly hope no one has to wear a mask to the ceremony.

 

What We’ve Done

A few months ago, I was invited to speak to a community group about my work on the Town Council in Collingwood. I saw it as an opportunity not only to gather my thoughts about the last many months, but also as a chance to learn PowerPoint, since the meeting would have to be held virtually because... Covid.

I was grateful for a chance to learn and a chance to reflect, and boy, has there been time for both in the last while, because...Covid. I went through the copious notes I take before and during meetings, and I had to go through some minutes and agendas, too, because, I have discovered, my note-taking is copious, but not always, um, legible.

We have made quite a few decisions I'm proud of. I think we've kept our tax rates reasonable, and that saying yes to a hockey team and to cannibis retailers were good choices. It was also a good choice to put money into helping the people who have been sleeping in our parks.

When Covid hit, we moved quickly to close down our facilities for safety's sake, and deferred tax payments for people who needed that break while they sorted things out. We brought in a somewhat nuanced approach to our overcrowded parks that will be tweaked in the next few months, since it appears Covid will not be cured before next winter.

I'm proud of my council colleagues for joining me to stand up to the province when it made its wrong-headed decision to gut Conservation Authorities, even though the effort ultimately proved futile, as I'm sure at least some of my colleagues were aware it would.

I'm also proud of our response to the Black Lives Matter protests, and the increasing awareness of the need for a concerted response to expressions of hatred and division. The council was unanimous in calling for provincial and federal changes to hate speech laws, and we have created what is being called a 'Unity Collective', to make space for us all to learn more about systemic discrimination, privilege, and power. As I tend to when confronted with difficult topics, I started reading, and am now familiar with the work of James Baldwin, Ijeoma Oluo, Ibram X Kendi, Robin DiAngelo, Carol Anderson, and Ta-Nehisi Coates in an attempt to become more aware of and responsive to these issues. Eight books is not enough to fully understand the fallout and fix the mistakes of the last 400 years, but it's a start.

We've approved a plan to build the long-awaited splash pad, put in some permanent washrooms at Fisher Field, and revamp the playground and pavillion at Sunset Point. We also finished fixing up Napier Street. Mountain Road is next, along with implementing the cycling plan and planting a thousand donated trees over the next five years. All that plus re-doing our Official Plan and our Strategic Plan.

Has it been perfect? Why, no. I think it's taking too long to make decisions on some items, like assigning the share sale proceeds and determining what to do with the terminals. But, as we discovered in the 900 pages of the Judicial Inquiry, when a town council rushes into a decision, it's not generally a good decision that's made. Speaking of which, I'd like to make some decisions in the next very very short while on what was contained in the blessed JI report. You can view what I had to say about it on my council facebook page.

As I put together the PowerPoint, I also realised how much I've learned about process and prodedure and how the whole 'municipal governance' thing works. I'm no expert yet, but I'm starting to understand my 'unknowns' and 'known unknowns', and there are fewer 'unknown unknowns' each day.

At the start of this new year, I'm hoping for peace and safety for our cousins and friends in the US and a quick vaccination schedule for Covid. In the meantime, I look forward to long walks with my doggie on the trails when they're not icy. When they are icy, we take to the sidewalks, where I continue to seek out 'flowerpot houses'. I hope you, too, are weathering the lockdown as well as possible under the circumstances.

Time is flying and yet oh, so slow

It was only two weeks ago:

I played the last game of the season at the Collingwood Curling Club
I voted to close down all public facilities at the end of the day.
There were only a few deaths from COVID 19 in Canada, and none in Ontario.


Today:

53 people in Canada are dead from this brand new disease.
Ten people were reported killed by COVID 19 in Ontario just today.
Millions of other people are unemployed.
Billions of dollars has been pledged to keep us all afloat.

It feels like a year since January 25th, the day the first case was identified in Canada.
To the families of those killed and sickened, it must feel like an eternity.

Questions and Leadership

Year Two on municipal council in Collingwood has begun with a pair of opportunities to learn how to lead. I have been elected Chair of the Corporate and Community Services Committee in Collingwood, and Vice-Chair at the Nottawasaga Valley Conservation Authority.

Since I had been Vice-chair of C&CS, I expected the nomination to the Chair's role, and spent the weekend before the meeting re-reading Collingwood's Procedural Bylaw and the amendments we passed just a couple of months ago. I wanted to be ready, just in case. Even so, plopping my bottom into the chair at the front of the room, I was very certain I was about to make some terrible gaffe. Sure enough, the Clerk had to bail me out with some hastily written post-its.

My habit so far has been to take notes throughout our meetings: points that occur to me, reminders to look something up afterwards or to get in touch with someone affected by the outcome of a decision. I show up at committee meetings with a list of questions, and cross them off as they get answered during the presentations or if my question is asked by someone else. I also jot down new questions that sometimes bubble up as presentations are made or I write follow-ups to other councillors' queries. Now, as a Chair, I still get to ask questions, but I also have to keep track of where we are in the agenda, be ready with a response to anything that happens and direct other councillors' questions to staff members. It's a different kind of listening, and while I only have half a meeting under my belt, I can report that it's a more intense experience.

It seems there are two divergent philosophies about the flow of municipal council meetings. The first I'll call Quick and Quiet: the thought is, we councillors should not have questions at an actual Council meeting, since anything factual we need to know about a topic coming to the table should have been answered at the Committee level or through emails to staff or other council members after the Committee meeting. An extreme adherent to this philosophy told me, there shouldn't really be councillor questions at the committee level, either, since council members should read the reports trying hard to understand where staff is coming from, and then to be in contact with the relevant staff member to have any questions answered in advance of the meeting. If a question occurs to the council member during the meeting, the Q&Q think, "Well, that's too bad since the councillor clearly didn't think things through enough in advance." Q&Q people suggest meetings should be very short, with presentations made and discussion containing only debate among councillors.

The second school of thought I'll call Long and Loud: under this philosophy, meeting time is for thorough and fulsome discussion with staff and among councillors. L&Ls figure it is the responsibility of our senior staff to be ready to answer anything under their purview, even without much warning. L&Ls see committee and council meetings as an opportunity to educate the public on the topics at the table, by giving staff a chance to explain what's going on with a certain project or program. Extreme adherents to the L&L philosophy figure there is no such thing as an under-prepared question, never a wrong time for even simple questions. Some L&Ls ask questions they know the answer to, in order to get the information into the public realm. They also think a meeting should take as long as it takes, and that we councillors should be prepared to stick around, listen, and have our minds changed.
The cynical journalist in me notices that closer to election time, some councillors who are usually Q&Qs become L&Ls, perhaps to demonstrate to voters how hard they work and how engaged they are. Some might even jockey for a late-term Chair position to shore up their bona fides with the electorate.

I'm all for efficiency, but I'm also a fan of transparency, so I'd like to think I'm in the middle of these two philosophies. But, I confess I likely lean toward the L&L group for reasons to do with spontaneity and a career interviewing people with an ear for not only what's said, but what's NOT said. I'm torn when raising my hand, though, because right from the orientation sessions in November of 2018, we councillors were told repeatedly that meetings were never supposed to be a 'gotcha' moment. It was said several times: councillors were not to ask questions that might put staff members on the spot or in a difficult position. I can see the point, but I can't imagine any question of mine could stump our deeply knowledgeable staff. That said, I cannot forget the CEO I once worked with who told me, right out loud, that they would use or withhold information to manipulate their Board of Directors. I have not seen manipulation of this council, but the concern remains on my mind, especially in light of the testimony at the Judicial Inquiry.

In a perfect world, the best case scenario would be somewhere between Quick & Quiet and Long & Loud, with councillors carefully reading all the prepared material in advance of meetings and seeking answers beforehand, but also free to ask something that only occurs to them at the time of the meeting. Perfect presentations from staff would not only make recommendations, but also fully explain any and all points the councillors want to make constituents aware of even while providing positive or detrimental effects of all possible choices. But, we live here and now and not in any kind of perfect world. (plus, those would be some very long reports...sheesh!)

Several people have told me there have been Collingwood town councillors who opened their agendas only as the meeting got called to order, and we know from the JI testimony there have been councillors who were emailed directions on what to say at the table even while meetings were underway. I am pretty sure those days are over, but I suspect there will be at least one Committee Chair who somehow lets a meeting get out of hand, in spite of their best intentions and a stack of sticky notes.

What Avril Said

Avril Lavigne famously sang, "Why's everything got to be so complicated?", and in a year of getting up close and personal with how municipal government works, I frequently found myself humming that song. I'm starting to understand why and I'm sorry to report, there is almost never an easy or quick way to solve issues and complaints, mostly because of rules and agreements that are already in place.

I've actually started to tune out a bit when people say to me, "Why can't they just..." As soon as anyone whips out the word, just, I just... realize they may not know the ins and outs of how stuff gets done and who's responsible for what.

For example, "Why can't we just say no to every and all new developments, and declare that Collingwood is full?", as a few people have suggested to me. Well, because municipalities exist entirely 'at the pleasure of the province', and we have to do what they say. We are allowed to make plans about what development goes where and how much of it we will allow, but those plans have to conform to the plans of the province and the county when we make them. Not just the province, but a whole whack of things at the province, like the Places to Grow Act, and the Provincial Policy Statement and the Municipal Act and several other pieces of legislation, too. So, if the province says Collingwood can have 62-thousand people by the year 2041, then, that's how many people we have to be ready to accommodate. Which is what they say, by the way. Sort of. It's complicated. The county's plans, which were passed this past year, go to 2031, but the province's plans, which are still in the making, go to 2041 and the allocations for population are different in those two documents so far. In addition to the plans is the LPAT, formerly known as the OMB, which developers can complain to if their plans get rejected by the town, costing us lots of time and planners' and lawyers' fees and there's no guarantee who will win.

Another example is, "Why can't they just... pick up my garbage every week like I want them to?" Not surprisingly, the answer to that one is... complicated.

First of all, garbage is not the town's job; it's the County's job.

Secondly, the trouble with trash in our area comes partly because of the economy, partly because of some zealous negotiations and perhaps because of some misunderstood circumstances. Once upon a time (about seven years ago, I think. Maybe 10), Simcoe County made a deal with a waste company to contract out its garbage and recycling services. A few years later, another company bid on and got the job, in what at the time was seen as a helluva good deal for the taxpayers of the County (that's you and me). The deal was so good, it was almost too good to be true. Well, last year, the too good to be true part started coming true, when the company that was doing the job, started not doing the job so well. They couldn't get enough drivers. Even with pretty great wages, they couldn't live up to their contract; even with bonuses and some pretty impressive incentives, there still weren't enough people willing to do the work of slugging your trash and recycling and driving the truck they slug it into. To be clear, there are a lot of people who are simply not strong enough to do that work. Furthermore, the economy is good enough that people who would take such a job unwillingly, don't have to, because there are so many other choices. If a person can get paid almost the same amount of money to work somewhere warm and dry without having to leap into and out of a big truck to lift heavy, smelly, disgusting items into that truck, which they also have to drive on snowy tiny country roads and wee small town streets, many of us would take a lower but still livable wage and choose the warmth and comfort. That extra five bucks an hour, for a lot of people, is not worth doing a job that is, in the case of the green bins, literally, shitty (diapers and dog doo now allowed!). What would it take, pay-wise, to lure enough people into the difficult jobs? 60 dollars an hour? 80? What would you say if trash collectors were paid more than your kids' teachers? Also, remember the company with the contract is a for-profit company, after all, and you'd have even less service if they go bankrupt to fulfill the contract.

So, because of these complicated factors, we have blue bins left out in the snow for days and garbage not always being picked up, and frustrated, complaining people. There will be more complaints next month when we start to get trash collected only on opposite weeks to recycling. You can just take your recycling to the dump yourself; it's free and no one's stopping you, but will you? Most of us won't. The question is, how many of us will start scouting out private bins or illegally dumping trash in the countryside? It remains to be seen.

So, that's two examples. And here's a third: "Just who am I supposed to blame when I can't get you what you want?" Well, that one is really not complicated: municipal politicians blame the other levels of government. As seen above, sometimes it's even true.

What do you get for 1.09 +.75? Another explainer.

We finished the budget on the 17th of December with a 1.09 percent tax increase. That's on top of the capital levy of .75%

What do you get out of it? Well, among other things: the beginnings of a waterfront splashpad, a revamped park at Sunset Point, a rescue boat, flush toilets at Fisher Field, a sidewalk on the east side of Hurontario south of the public high school, and water and sewer works redone on Napier south of Hume. Oh, and your roads and sidewalks plowed pretty promptly and firefighters at the ready.

What do you pay? It depends on the assessed value of your house, but if it's $324K, the town part of your tax bill last year was $2191.80, and will go up $42.53, or about four bucks a month. To put it in context, HGTV on cable is 7 dollars a month.

How did we get to the final numbers? At the end of our first two meetings, on Monday the 16th, with all the things on the 'big list of things we'd like to do', the increase was edging toward 4 percent, plus the levy. I would not have supported that.

Through the next day, there appeared to be a lot of discussion between the CAO and the Treasurer, along with the department heads, and the original base budget was cut a bit, and several items on the 'big ask list' (29 service enhancements) shaved away. As we sat down for the final meeting, a new set of numbers was presented, with a 2.04% increase. After much discussion about the price of trees and the width of sidewalks, a suggestion was made by one of the councillors that we use some of the interest from the asset sale cash to pay for some of the desired items. There is $18.6M in the bank until we decide what to do with it. It's earning 2.3 percent interest, which, over a full year, adds up to more than $400K. We voted to pull $200K of that interest into this year's budget, and voila, a few more things were afforded with a smaller increase.

When it appeared we had consensus, someone asked for a recorded vote, so we had to literally stand up for this budget. The vote was unanimous.

JUST FYI: -every- vote at Collingwood Council is now a recorded vote. As of January of 2019, if you want to know how anybody voted on any item, there's a tab on the website that lists it. You can search by member, by meeting, and by motion. So, any time a councillor asks for a recorded vote at a meeting, they are grandstanding making a statement.

Some bottom lines from the notes I took during the budget process:

-The town will tax its property owners $33,933,028 in 2020, which is $1,360,375 more than last year. Of that, we're putting $1,771,500 back into reserves.
-We should find out at the end of January the size of the 'surplus' from 2019, as mentioned last time, with a report some time later.
-The town has about 60 million dollars in reserve funds at the end of 2019, down from 65 million at the end of 2018. (that would be the Judicial Inquiry) Another $800K was approved in the 2020 budget to pay the bills from the JI.
-I did not love that the improved sound system at the Eddie Bush Arena was jettisoned; as a somtimes host of the skating carnival, there are years I have to put down the microphone and just... shout, which is not cool. However, we were told there might be things that can be done to get that particular project underway, so I'm hopeful on that item.
-Of the 12 items that survived the chopping of the 29-item 'big list', 9 were on my personal 'protect' list, so I'll call that a win.

*an earlier version of this post said the tax increase this year was 1.84: the 1.09 plus the .75 capital levy. After some back-and-forth with a member of the local media, I can see why Ian took umbrage was irked at my doing the math that way and I revised the headline. $42.53 on the 'average' bill is still correct, though: 24.68 from the tax increase and 17.85 from the capital levy.