Industrial businesses throughout the MD will be seeing a bit of a break on their taxes for 2018.
During their regular council meeting, the MD of Bonnyville passed a motion to reduce the mill rate for industrial businesses.
“I think we can send a very good message to our big players that we recognize the current situation in regards to the economic climate, and here’s an opportunity as a small government to make a stand and say ‘we’re here to do what we can,’ and in this case, lessen a little bit of the tax burden,” said Reeve Greg Sawchuk.
Made possible through an increase in their industrial assessment by about $4.4-million for 2018, council agreed to reduce the mill rate for non-residential properties to 15, a total drop of 0.5 from last year.
This will come at an over cost of about $2-million.
However, this will bring the industrial mill rate just that much closer to the residential, which could soon become a requirement under the Municipal Government Act (MGA).
“Why would we reduce this? Well the new MGA says that we’re supposed to have a ratio of 5:1 for industrial and residential. Currently, we’re at 5.6:1,” CAO Chris Cambridge explained.
Although the MD is not as far off from that goal as some municipalities, they would still like to see that gap tighten.
“The MD has an opportunity to be a shining star as far as a municipality in regards to being at the forefront of tax reform,” Sawchuk noted. “We’re looking at being a partner with the players rather than a taxation burden.”
He added, the mill rate reduction won’t only include industrial businesses. Because the decrease is being applied to all non-residential properties, small businesses within the MD will see an even further drop than what they’re already getting this year.
“The savings we saw earlier to the ratepayers will actually go up for both small business and the big players as well,” said Sawchuk.
Another consideration, Cambridge noted, was the potential for additional income for the municipality.
He explained, “This could spur an oil company, or even another company, past the tipping point for a planned expansion.”
When it came down to it, council agreed decreasing the mill rate was the right move, however there was discussion on whether to drop the mill rate by 0.5 or more.
In order to stay within their $61.7-million budget, council would have to keep the mill rate within the 5.24:1 ratio, otherwise they would be facing an additional loss of revenue. This works out to a 14.7 mill rate.
Most of council agreed on a slight decrease to the mill rate, deciding to play it “cautious” for this year.
Sawchuk and Coun. Dana Swigart wanted to see more of a relief for businesses.
When it came time to cast their votes, all were in favor except for Sawchuk, who stood behind making a more drastic move when it comes to the mill rate.
“It’s time for us to make a statement,” Sawchuk stated.
