Frances Bula header image 2

Vancouver prelim budget out: You pay $128 more in taxes on an average house

January 29th, 2009 · 9 Comments

Our favourite time of the year — budget estimates — is here again, with the traditional three acts: 1. The discovery that the projected tax increase to maintain the existing budget is not as high as everyone said the previous fall. 2. The wrangling over what gets cut or added, during lengthy public meetings 3. The final round, sometime in March, before it gets adopted.

The play kicks off with the preliminary budget estimates from Budget Mistress Annette Klein, out last night on the city’s website. If you want to read the whole thing (those of you brave souls who slogged through the Olympic village reports on London Inter Bank something something rates will likely find this a breeze), it’s here.

The essential points you need to know from all this:

1. They’re now looking at a six-per-cent overall tax increase, down from the 11 that everyone kept talking about during the election. That’s after some serious scraping inside city hall ($26 million worth), where I take it that Raymond Louie was working with staff to do things like trim the amount of money departments get to keep for staff turnover that provides a little cushion when those positions aren’t filled for a few months. They also benefitted from a few advantages, like plunging gas prices, which will save them $1.2 million.

2. But your residential tax increase will be higher than that because the Vision council is sticking to the plan of shifting taxes from residential to business. So they are predicting that the tax increase on the average house of $783,000 will be $128. Of that, $33 comes from the tax shift, the rest is just from the regular increase. As a result of the shift, small businesses worth the same average amount will see their taxes lowered by $155. (Of course, big businesses worth more will get a much bigger tax cut.)

3. There’s no impact from the Olympic village on property taxes this year. But there could be in coming years, if the condos don’t sell for enough to cover the loan.

Not in the report, but coming soon, says Raymond — the Vision council will be using some of the money saved to fund a few of the things promised in their platform: a mental-health advocate, a “green grant” to foster innovative environmental projects, money for an external auditor to review the city’s whole budget, and a chunk of money for child care and youth services.

Categories: City Hall Talk

  • humph

    Glad to know that my residential tax increase is going to ease the burden on Walmart.

  • td

    There has been no decision on how, if necessary, an Olympic Village loss might be funded. Presumably, we could liquefy assets held in the Property Endowment Fund and use that to fill any holes.

  • Steve Drinkwater

    Item 2: Don’t you mean Vision is sticking with the plan to shift taxes FROM business TO residential?

  • Bill Lee

    738 million dollar home is average!!
    Must be shome mistake…

    “So they are predicting that the tax increase
    on the average house of $783,0008,000 will be $128”

  • foo

    Make that $7.83 billion home. Sounds about right for the average Olympic Village condo…

  • T W

    Where is the word “risk assessment” in all this?

  • Joseph Jones

    “There’s no impact from the Olympic village on property taxes this year. But there could be in coming years, if the condos don’t sell for enough to cover the loan.”

    Restate as:
    Condo Sales – Loan = Profit or Loss

    Isn’t the present situation a lot more complex than that?

    1. Cost of all borrowing relates to credit rating
    2. Ability to borrow depends on availability of funds (Today the Province decides to bankroll the Port Mann expansion because Macquarie cannot raise money.)
    3. Credit rating relates to overall level of indebtedness (ratios matter)
    4. Credit rating relates to level of property endowment fund
    5. Level of property endowment fund relates to fluctuating values of real property

    I see five vicious interconnected circles …

  • spartikus

    Everyone should relax. Citizen Sam will have an editorial later today that will explain the only problem Vancouverites face is whether they make 1.3 or 1.5 billion in profits on Millennium.

    I’m reassured. Aren’t you?

  • LP

    Taxes are going up, but it’s necessary to spend anywhere from $4M to $11.7M on changing a bridge so that maybe 200 more people will cycle and walk to work during peak rush hours.

    This money could be better spent on people without homes and jobs, then people with homes, biking to their jobs.

    Car users aren’t asking for any changes, it’s the pedestrians and cyclists that are. This is a silly waste of money (for a couple of hundred people) when it could be better used on helping the needy in this city.

    Sad very sad.