Where does the money go?
The answer to this question is both simple and complex. The simple answer is taxes collected from Area C (South Shuswap) properties are spent on services provided to its residents.
While it is a common misconception, property taxes collected from Area C residents are not diverted to provide services to other areas.
A unique aspect of regional government in B.C. is use of the principle of “fiscal equivalence.”
In short, when services are delivered to a group of people, that group of people must cover the costs.
This sets up the complex answer to the question above.
When services are shared across a regional district, an electoral area, a sub-electoral area or within a subdivision, there needs to be a way to fairly allocate the taxes collected from all of the populations serviced.
The Columbia Shuswap Regional District budget for 2013 includes allocations for administration, 911 emergency telephone services and solid waste management. These costs are shared across the entire CSRD based on property tax assessments.
Electoral area budgets include allocations for electoral government administration, bylaw enforcement, GIS/mapping and development services. These expenditures are shared across all electoral areas, based on property tax assessments.
Several budget items are allocated within Area C, and these directly fund such services as Area C parks, First Responders, transit, dog control and grants-in-aid.
Area C, along with other electoral areas and municipalities, shares in the costs of services that benefit their populations, and examples of these include the Emergency Preparedness Program, Shuswap Regional Airport, Milfoil and Weed Control, Shuswap Tourism and Economic Development.
Area C also contributes to the multi-purpose recreation centre in Salmon Arm as some of its residents also utilize that facility.
Local services are funded by taxes collected within a specific region of Area C. Examples of these include Area C Sub-Regional Fire Suppression and street lights in Blind Bay.
Parcel taxes are collected as a flat cost-sharing rate per parcel to fund specific services such as Cedar Heights Waterworks, Eagle Bay Waterworks and Sorrento Waterworks.
Your annual Rural Property Tax Notice provides you with a description of how your tax dollars are allocated.
The tax notice shows amounts allocated and collected by the province to cover school and police services, as well as the provincial rural tax. There is also a description of the local services which represent expenditures by the CSRD on your behalf.
Allocation of budgets are done on a mill rate basis, which is a factor multiplied per $1,000 assessment of your property to generate a taxation figure.
For 2013, the key residential mill rates affecting Area C are as follows:
• Total Regional Government 0.251;
• Total Electoral Area Government 0.399; and
• Total Area C Functions/Services 1.253.
In addition to the above, your property tax notice may include mill rates for a local service you receive such as street lights and fire protection.
For 2013, the increase in property taxes in Area C for an “average” residence will be 1.2 per cent or $4.82.
It is a complex process to pull together the annual and five- year budgets for the CSRD.
In some cases the cost allocations are fairly straightforward, in others a cost-sharing formula is used to estimate the fair utilization of a service or function.
If you would like to suggest topics for future articles, or participate in our advisory panel surveys, please contact me at email@example.com.
– Paul Demenok is the Area C Director for the Columbia Shuswap Regional District.