The new District 12 is an awkward, sprawling affair cobbled together nonsensically in order to meet the UARB order for a reduced number of council seats. The district consists of the highly populated Highway 3 corridor of the current District 22, but then reaches across 3,000 acres of the Birch Cove Lakes-Blue Mountain wilderness to include the westerly portions of Clayton Park.
- The new District 12.
The rest of Clayton Park, those areas between the District 12 boundary and the Bedford Basin, are in the new District 10: Birch Cove—Rockingham—Fairview. It's very unfortunate that Clayton Park has been split in two like this. There is no doubt that Clayton Park is one community of interest, and had the area had an effective councillor, one who was willing to fight to keep the neighbourhood intact for council purposes (like Lorelei Nicoll did in Cole Harbour), perhaps we'd now be looking at a more coherent district. But alas, Clayton Park is currently represented by the out-of-touch, non-responsive Mary Wile, who didn't so much as lift a pinky to battle the redistricting plans that tore the neighbourhood apart.
Because the community was torn asunder, the condo-heavy area around Willet Street is not in the new District 12. For better or worse, there are two high-profile issues that are important to residents in the Willet Street area: the location of a new and soon-to-be constructed Lacewood bus terminal, and the tax bills for condominiums.
The details of those issues matter to Willet Street residents, but by and large they are tangential, minor issues to the bulk of the residents the new District 12. I doubt there's even one condo in the Highway 3 corridor, which is mostly affordable single family homes and mobile homes. The area in the Clatyon Park part of the district south of Lacewood Drive is almost entirely apartment buildings, while the area north of Lacewood is mostly single family homes, with a lot of apartment buildings along Parkland Drive. Apparently, there are also a few condos in the area, but condos are definitely a small sliver of the housing stock of District 12.
That didn't stop a group of condo owners showing up and hijacking the discussion Tuesday night. I'm told they were urged on by something called the Canadian Condominium Institute. According to the provincial Registry of Joint Stock Companies, the Nova Scotia chapter of CCI defaulted on its registration payments in 2009, so is no longer a legal entity. When it was legal, its president was Norma Cameron, a realtor who advertises herself as a "condominium specialist."
- The Nova Scotia chapter of the Canadian Condominium Institute ceased to be a legal entity in 2009, but sent out flyers to Clayton Park residents last week.
But legal or not, in the days before Tuesday's forum, CCI had sent out a flyer disingenuously comparing condo and apartment taxes, and many of the questioners Tuesday were using the exact same language that appears on the flyer.
Here's how a resident who said she lives in a condo on Parkland Drive put her question to candidates:
I want to talk for a moment about condo taxation. It’s been a problem here. There are quite a few condo buildings in this district and the number will increase in the next few years. Condo owners are paying as much as twice the property tax of comparable residential buildings even though services are similar, and both are efficient to service. Condominiums are assessed on the basis of market value according to recent sales, thus assessments keep appreciating. But the value of apartments is based on revenue, and depreciation is allowed. The result is assessments went up for condos and down for apartments, and the assessments have widened. It has been determined that the municipal taxation system is a mess, is totally unfair and getting worse. The system relates not only to condos but to other HRM tax issues. Efforts by past councils have not resolved any of these issues, and it is time that a fair and equitable tax system is formulated.
The questioner then went on to ask the candidates for a written commitment to revisit "tax reform" within six months of taking office.
But besides quoting directly from the CCI flyer, the questioner's statement is almost entirely filled with misstatements, out of context representations and flat out untruths.
First, it would be news to apartment owners that either assessments or property taxes on apartments are going down. That's simply not true. You can check yourself. Google "apartments on Parkland Drive," and enter the property addresses into the Property Valuation Services Corporation website. The first Google result is 334 Parkland. Here's the assessment history:
The second Google result is 680 Parkland. Here's its assessment history:
Clearly, the assessments on these building have gone up, significantly—since 2001, 110 percent for 334 Parkland, and 201 percent for 680 Parkland. I've been reviewing property records in Nova Scotia for over seven years, and have looked at thousands of assessments. Not once have I ever seen a decrease in apartment assessments. It doesn't happen. Never.
Oh, and the comparison to condos? Bogus. Here's the assessment history of condo I picked randomly on Parkland Drive, unit #101 at 512 Parkland:
Since 2002, the year it was built, the assessment on that condo has risen 60 percent—still significant, but a hell of a lot less than the assessments on nearby apartments.
Second, CCI omits one hugely relevant fact: there's an assessment cap on condos, and not one on apartments. People can disagree on the merits of the assessment cap (I support it), but when CCI implies that condo taxes are going up while nearby apartment taxes are going down, they are at best hugely misleading the public. If you bought a condo in the last few years, no matter what the assessment on it, the tax bill did not increase more than the consumer price index. People who live in apartments, however, are seeing the increasing tax bill, with no cap, passed on to them in the form of rent. Additionally, people paying property taxes on condos are building some degree of equity, while apartment renters are not.
Third, the CCI solution—it explicitly calls for "a taxation system, based on payment for cost of services received," that is, a fee for service system—is not something anyone in Clayton Park, including condo owners, should want.
As I've pointed out before, if we were to have a true fee for service tax system, the very first thing we'd have to do is triple all residential property taxes, as commercial property taxes "subsidize" residential taxes at a 3-1 ratio. Only then could you go down the "fee for service" road with some claim of honestly paying the full cost of the city services you receive. But perhaps condo owners are arguing that the commercial subsidy should remain, and then the remaining residential tax re-jigged so their bills go down still more, and they'll smack a "fair" label on it and claim they're paying their own way. That's dishonest, to put it mildly.
Still, even if the CCI got its way entirely—that is, the commercial subsidy remains, and the remaining taxes are apportioned at a third of some theoretical cost of service (a problematic calculation in its own right), what would it mean for the rest of District 12—that is, for the vast, vast majority of residents who live in apartments or below-median priced houses and trailers?
When council was considering the Orwellian-named "tax reform" proposal in 2009, I calculated the effect on apartments:
Consider apartment dwellers."Tax reform" proponents argue that the owners of apartment complexes pass property taxes along to residents in the form of rent, so if we lower the tax, it'll result in lower rents. I find that logic suspect, but certainly the reverse is true: if we raise taxes on apartment buildings, the extra charges will most definitely be passed along in higher rents.I wrote then specifically about Burnside and Highfield Park, but the exact same relationship holds for Bayers Lake Industrial Park and the apartments on Regency Park Drive in District 12, albeit the rise in apartment rents was slightly lower—about $100/year/unit, on average.
On the peninsula, the proposed tax scheme charges some apartment owners a little more, others a little less. The real differences, however, come in Dartmouth: apartment buildings in Dartmouth will see a tax increase of hundreds of dollars per unit.
The same city council that is considering "tax reform" has, through the years, spent hundreds of millions of dollars developing the Burnside Industrial Park and Dartmouth Crossing, and as a result, thousands of workers have taken up residence in nearby apartment buildings in Highfield Park and the Dartmouth waterfront. These workers live in dense housing projects, have easy access to transit, can walk to work and services, et cetera---in short, they are living the low-impact urban life we supposedly want to encourage with "tax reform," and yet "tax reform" will surely cause their rents to go up.
And what about single family homes? Here's what I concluded in 2009, and nothing has changed since then:
Regardless, suppose the entire "tax reform" plan is implemented, including the vague low-income relief plan. Now look at how taxes will change from our present system to the "reformed" system:And what kind of housing dominates the new District 12? You got it: modestly priced houses and apartments.
Very low income property owners: some additional relief.
Above relief level to median house value: increased taxes.
Median house value to very high value house: decreased taxes.
Very high value houses: vastly decreased taxes, plus an unknown surcharge.
"Tax reform" proponents celebrate an uncertain plan for some small amount of additional low-income relief, but their plan mostly gives millions of dollars of certain tax relief to median to high-end properties, paid for by owners of modestly priced houses.
Of course, the CCI can spout any dishonest nonsense it wants. What really matters is how wannabe councillors respond to it. And here's where our candidates come in.
- Reg Rankin
There’s been a lot of talk of fair taxation. We failed by three votes. I want to reengage that subject. In particular, there are a lot of condominiums that deserve better treatment in terms of fair taxation.
Responding to the questioner, Rankin elaborated:
I anticipated your question, and Ill put it in writing. There has to be a fairer tax system. It was a narrow loss, 13-10, and I was on the losing side, but one of my qualities I hope is persistence, and I’m looking forward [to revisiting the issue]. Quite frankly... apartments and condominiums are paying more than their fair share. The very least we can do is charge for garbage based on the cost of the service.
Rankin has long sought this incremental introduction of "tax reform," breaking one service out at a time to bring the whole program in bit by bit through the back door. I'll note in passing, because I really don't think it affects his decision making, but Rankin is probably one of the very few residents in Timberlea who would've personally seen a tax cut under the 2009 "tax reform" proposal. Had he bought his house that year, his tax bill would've gone down about $509 a year. Meanwhile, apartment dwellers on Regency Drive would see their rents go up to help make up the lost tax revenue to the city. But regardless, Rankin is ideologically committed to a fee-for-service system, and he hasn't wavered from it.
- Bruce E. Smith
First of all, I do support tax reform. I think [the current tax code is] quite unfair not only for condominium owners but also for small businesses. Tax reform did come before regional council in the past, but from what I know it was so complicated, there were so many options available that councillors couldn’t make sense of it, and that’s why it didn’t pass. I think we need an independent, outside evaluation of the tax system to bring a reasonable solution to council so that council can vote on it and not have countless different options to tax reform. And so I support it.
That's a bit less firmly routed in ideology than Rankin's response, but only a bit so. Smith points at the complexity of the proposal defeated by council in 2009, which is fair enough (it was complex), but clearly he supports the concept in the abstract. By his answer, he too would cut taxes on high end homes and make up the difference by increasing taxes on low-end homes and apartments.
- Mary Wile
I guess one of the things about being there at that time, we had a couple of days of tax reform discussion, and I voted for it. However, there are some advantages and disadvantages to it, and that is what [caused] some of the councillors to vote against the tax reform. And that was that some of the lower income people in lower assessed houses would then have an increase in their taxes. They were trying to even it out, and therefore the councillors reacted and didn’t want to see those at lower assessed homes and lower income being given an increase in taxes. And that was one of the things that was causing all of the concern with many of the councillors.
That's an astounding statement. Wile recognizes that "tax reform" would've increased taxes on lower-assessed houses while lowering it on higher assessed houses, but voted for it anyway.
- Rano Khokhar
I would support fully a process to achieve [a fairer tax system]. Young couples and people on limited incomes are having a very difficult time to maintain their taxes, because they have to send kids to school for their education, food and their other activities.
While Khokhar's recognition that taxes are most difficult for young people and people on limited incomes is welcome, it's clear she has no idea what the "tax reform" proposal was all about, or that a fee-for-service system would most hurt the very people she expresses concern for.
Understand that within District 12, this is not a battle between condo owners and everyone else. There’s no conceivable version of an HRM-wide fee for service tax system that benefits any Clayton Park residents, including condo owners, in a substantial manner. On the contrary, what “tax reform” will mean is vastly lower taxes on the Halifax peninsula and for oceanside mansions, while nearly everyone in District 12, including condo owners, pays more in taxes.
So there you go, residents of District 12. You've got one candidate who is enthusiastically in favour of raising the vast majority of residents' taxes, another who is open to figuring out how to do it with less complexity, a third who acknowledges that it will hurt those who can least afford it the most but voted for it anyway and a fourth who has no clue what the issue is about.
Good luck with that election, eh?