Passionate pleading by business backers didn’t budge the majority of North Cowichan council from their 2015 budget choice: shifting more of a planned tax increase onto business and industrial.
Rejecting an option that called for a 3.22% tax increase across the board, council narrowly approved a budget that will result in a 2.98% jump for residential property owners and a 3.7% hike for commercial and industrial properties.
The votes of Councillors Al Siebring, Tom Walker, Joyce Behnsen and Rob Douglas carried the day, with Mayor Jon Lefebure and Councillors Kate Marsh and Maeve Maguire preferring the across-the-board increase.
“We’re one of the lower business rates on the island compared to other municipalities. The lion’s share of this will fall on a handful of properties. It’s not ideal, but it’s quite a small amount for most businesses,” Douglas said.
“We need to show we care about homeowners,” Councillor Tom Walker said. “Many homeowners are now struggling. We keep talking about the average house but I have trouble finding it.”
Cam Drew of Thermoproof Windows in the Chemainus industrial park led the charge at North Cowichan’s May 6 council meeting as business owners packed the council chambers trying to change that mindset.
“If it is the goal of council to download the burden to light industry, congratulations, you’ve already done it,” he said, explaining that his light industrial operation, which employees 27 people and has a payroll of more than $1 million per year is already paying five times the rate paid by the residential class.
He was backed by Brad Grigor of the Chemainus Chamber of Commerce saying profitable local businesses spend money locally and are also local homeowners so they get hit twice by North Cowichan taxes.
“A tax increase for a business is not a write-off. It erodes profitability and that profit is the only take-home pay for the owner.”
George Gates, another Chemainus business owner, questioned the message council was sending. He said council was backtracking on a progressive message sent by previous councils to anyone looking to open a business.
“I may not be able to trust you after this vote,” he said. “This shows you’re not on board with that plan. I’m concerned.”
He certainly had the support of Marsh.
“I feel this is a defining moment for council. We’re in the first year of our term. It’s all about messaging. Who we are as council. We can set the table for business,” she said.
Marsh also pointed out that North Cowichan’s staff had originally come to council with a budget proposal that saw every class looking at an increase of only 2.89 per cent.
“We chose to move it up to 3.22 per cent. We don’t want to hide that we did this,” she reminded her colleagues.
Siebring, although on the other side of the vote, agreed.
“Councillor Marsh is right. We all have to wear this,” he said, explaining he thought a three per cent ceiling was an important psychological threshold for the residential class and that if the municipality had been able to keep the evenly-distributed rate at under that level, he would have been able to consider supporting it.
Mayor Jon Lefebure noted in his comments that one thing council must remember as it looks at future budgeting is that it is the residential sector that is growing and that any more attempts to shift the tax burden away from homeowners would see diminishing returns.
Total taxes on a $300,000 home in this year’s budget will amount to about $1,370.