Tofino’s residential property values are rising while businesses are declining, but tax rates of both will increase this year.
Tofino’s municipal council adopted the town’s 2021 tax rate on April 27, setting the year’s Municipal Tax Levy at $4,799,495.
The residential class’ municipal tax rate will be 2.46 per cent in 2021, up from 2.04 per cent in 2020. The business class will also see a bump in its tax rate to 8.67 per cent, up from 6.3 per cent in 2020. A key reason for the increase is the reintroduction of the Capital and Infrastructure Levy, which Tofino nixed in 2020 to give residents and business owners a break in light of the economic impacts of COVID-19.
In a presentation to council, Tofino’s director of financial services Nyla Attiana said the town has seen a roughly 5 per cent overall increase in assessment values, largely due to a significant $74 million spike in residential assessments, rising from $968,346,002 in 2020 to $1,042,436,102 in 2021.
“That is in line with the development that we saw over the last year. We’re not surprised, based on the amount of new construction in the residential class, to see that increase significantly,” Attiana said.
She added the business assessment dipped by about 5 per cent from $255,400,424 in 2020 to $243,049,401 in 2021, adding this was somewhat expected due to the economic impacts of COVID-19 in 2020.
Using examples of properties in town, Attiana laid out that a residence assessed at $641,000 will pay $1,579 in municipal taxes in 2021. That same residence was worth $609,000 in 2020 and paid a $1,245 tax bill.
She said a resort assessed at $16.6 million will have a $143,984 municipal tax bill in 2021. That same resort was assessed at $18.97 in 2020 and paid $119,469 in municipal taxes.
A restaurant Attiana used as an example held the same $1.98 million value in 2020 and 2021, but will pay $17,165 in municipal taxes this year, up from $12,464 last year.
“I’m curious why a restaurant business gets hit so much harder than other business types,” said Coun. Al Anderson. “It’s almost a 40 per cent increase and the next highest is around 27 or so.”
Attiana responded that percentages will vary based on the assessment value of a property.
“It’s a proportionate increase,” she said.
Coun. Cathy Thicke questioned why residential properties saw an increase in value in 2021 while resorts dropped in value.
Attiana suggested the residential and business classes are assessed differently.
“When commercial properties are reviewed and assessed, they do consider revenue information for example and that’s not something that’s considered with a residential property,” she said. “They are evaluated differently.”
Mayor Dan Law asked about the split between residential and business taxes.
Attiana said the proportion each class pays remains consistent year to year, though she noted 2020 was not typical.
“In a typical year, we will see increases in the residential class and commercial class fairly consistently, given the economic year that we’ve had, we did see the business class decrease, but what happened is the split between the residential and the business class didn’t change very much,” she said. “The revenue being collected was consistent with prior years, I believe the change was about 1 per cent…The split is not quite 50/50 but it is quite close to 50/50, so it didn’t change significantly.”