Representatives from Tolko Industries have asked council to reconsider its 2011 industrial tax rate.
During a committee of the whole meeting Tuesday, company representatives cited tough economic conditions for their request and said that industry in Williams Lake shoulders too much of the City’s tax burden.
According to a 2010 local government report on tax rates and assessments, Williams Lake’s rate for major industry ranked third highest in the province behind the communities of Ladysmith and Tahsis.
Under the City’s proposed 2011 budget, the tax distribution for residential properties is 38 per cent, 23 per cent for major industry and 24 per cent for business. That translates to a proposed tax rate of $5 per $1,000 of assessed value for residential; $88 per $1,000 for industry and $11 per $1,000 of assessed value for business.
“To see tax rates going up in a time when we’ve lost one third of our gross revenues — for the most part, we survive and to have tax rates continue to go up when we’re experiencing this situation is disappointing,” said Tom Hoffmann, Tolko’s Woodlands manager.
“Since 2006, two thirds of our staff is no longer with us. … We are telling you how serious this is. It is extremely serious.”
Mayor Kerry Cook said the industry tax-rate increase is due to assessments in that category dropping over the years for industrial properties within the City boundary. Since 2006, the tax rate has increased to $88 for $1,000 of assessed value from $74; the tax distribution percentage for industry, however, has declined from 25 to 23 per cent.
Hoffman further suggested that council’s proposed industrial revitalization tax exemption bylaw is unfair to existing industry.
The bylaw has yet to be adopted but has been developed by the City with the hope of growing the industrial tax base, increasing employment and encouraging environmentally friendly business development. Based on factors such as the number of new hires or value of a company’s capital investment in the community, businesses may be eligible to receive a property tax exemption that would be applied on a sliding scale.
“The tax break to new industries made me think what about us? Can you offer a tax incentive to help us get the mill back up? We want to get it back up,” said Hoffman, adding he credits the City with attempting to attract industry but not at the expense of the plight of existing local industry.
Business attraction and retention are important, said Hoffman, suggesting the City decrease its costs in order to offer a lower tax structure.
Mark Stevens, general manager of Cariboo operations for Tolko, told the committee he thought council needed to do something “huge.”
Cook said if the City is able to attract industry with its proposed bylaw while maintaining the current tax-distribution model, the tax rate for industry would decline.
Cook also said during council’s first year it had cut $750,000 from the budget in response to economic challenges. She also cited ongoing financial demands on the City such as repaying debt and interest on the debt, as well as the challenge of managing services downloaded by other levels of government.
Gurbux Saini, a member of the public in attendance, told the committee that shifting the tax burden was not the answer.
“The answer is cutting expenditures,” he said.
The City expects to adopt the budget in May.