Mike Youds Special to the Chronicle
New infrastructure costs money.
And that means Ladysmith could be in line for property tax increases of 3.4 percent for residential property owners and 2.8 percent for commercial.
After reviewing five tax-rate options, town council has directed staff to prepare a 2019 financial plan bylaw intended to strike a delicate balance between the demands of costs, growth, affordability and competitiveness.
Council chose Option 2A as recommended by staff, an option that Mayor Aaron Stone feels would fairly distribute the tax burden while keeping Ladysmith’s tax rate lower than neighbouring municipalities.
While a little higher than last year, the rate increase is consistent with others over the years, Stone said.
“We’re very cost competitive in the region … for residential and business investments,” he said.
The annual setting of tax rates is a complex calculation. Staff typically attempt to simplify the decision-making process by presenting a set of options, said City Manager Guillermo Ferrero. Each option varies the fiscal formula for the taxation classes with residential and commercial compared as key considerations.
“Obviously, there is always a desire to keep tax rates low,” Stone said.
The mill rate for calculating property taxes has been down for the last few years, which has helped to keep taxes competitive. At the same time, they want to account without delay for the costs of building municipal infrastructure, including the water treatment and water filtration plants, Stone said.
“The opportunity we see, for investment coming in, is to maintain our asset management.”
Fully two percent of the residential rate increase, for example, would cover capital costs.
“I was quite impressed with staff and council coming forward with a plan at a reasonable rate,” he said.
Once drafted, the bylaw will come back to council for debate and possible adoption at a future meeting.