On November 17, I wrote this post: http://crowsnestpasshome.blogspot.com/2011/11/financing-councils-dreams-another-pot.html
Over the last week, I have heard many statements regarding the issue of back taxes:
Lets address some of these comments going back to my original post, remember I said in my mind there are three catergories of taxpayers in arrears.
One being the 50-60% that is owed by a developer, second the people that miss the deadline for one reason or another and have no incentive to pay until the end of the year and third the people that just can’t or struggle to pay.
So back to the comments being made:
1- "The current 10% penalty is one of the lowest in the province and hardly a deterrent". First of all that’s just plain not true if you don’t pay your taxes you get nailed with 10% in June and a further 10% Jan 1st. (By my math that’s 20%)
2- “People are using there money elsewhere by not paying their taxes”. Certainly would not make a lot of sense to be delinquent on a bill that I am going to be charged 20% interest on versus investing the cash in a term deposit at 1-2%.
3- “Yes, some of those unpaid taxes are from developers such as RiverRun etc” How do we determine that? Maybe the problem as been going on for years?. In the audited municipal financial statements there is a section called notes, under that is a sub section titled “Taxes and Grants in place of Taxes receivable” lets look at the last five years.
• 2006-Total $203,669
• 2007-Total $244,727
• 2008-Total $268,400
• 2009-Total $357.519
• 2010-Total $570,581
Notice the numbers don’t really take a big jump until 2009 I think that really reinforces my argument that 50-60% of the arrears are owed by a developer, spilt 2010’s number in half and your almost back to the 2008 number.
4-“ but we have numerous residents who play the shell game every year.” “Numerous” that’s a fairly harsh word, the municipality sends out at least 4500 tax notices a year in my six years on council there was years we saw alarmingly high numbers of people faced with tax sales for being three years behind. Some years as high as 5 or 6. Yes everybody should pay their bills on time but we are not even talking about 1% of our taxpayers going to a tax sale we are talking about one tenth of one per cent. I think once you pull out the number owed by that one developer above you will find that we are very comparative to other communties in Alberta in addition to the historical number for the Crowsnest Pass.
5-Lets assume for a moment we became that unique municipality where everybody paid there taxes on time where would that traditional $40-50,000 in interest income come from?