Including a 4.5-per-cent residential property tax increase, the city’s elected officials greenlit Greater Sudbury’s 2023 tax implementation plan on Tuesday night.
The decision was made during a finance and administration committee meeting of city council, and includes an average residential property tax bill increase of $176, which varies depending on the area of the city and its assessed value.
Two councillors from The Valley — Ward 5 Coun. Mike Parent and Ward 6 Coun. René Lapierre — had intended on tacking on an amendment to lessen the tax burden in their wards, but didn’t proceed when city officials clarified what the financial implications would be.
At issue is the fact that this year’s tax increase will disproportionately affect residents of the former City of Valley East.
City council made the decision in 2021 to add eight career firefighters to Station 16 in Val Therese, using the city’s area rating model to divvy out the expense. This model has taxes vary depending on location within the municipality to cover fire and transit services.
Using this model, the city has been easing the entire cost of the firefighters onto the property taxes of those located within the former City of Valley East.
This, instead of the Greater Sudbury-wide tax base.
During the first year of the three-year ease-in, one-third of the arbitration was attributed to the former City of Valley East (composite area,) while career (former City of Sudbury) and volunteer areas (the rest of the municipality) were allocated two-thirds.
Year two saw the composite area carry two-thirds of the cost, and career and volunteer areas cover the balance.
This year, the entire amount of the arbitration award is being paid for within the composite area.
With residential property owners in The Valley facing an average property tax hike of 6.4 per cent against the city’s average of 4.5 per cent in 2023, Parent and Lapierre planned on introducing an amendment to ease the phase-in of firefighter costs over the course of an additional year.
That was, until they got clarity from the city on their plan’s financial implications.
The city would have to recalculate tax bills throughout the municipality, city Corporate Services general manager Kevin Fowke said, which would delay bills being mailed out.
“We have to have, by the Assessment Act, bills produced and mailed 21 days prior to due dates, so we were tight to start off with,” Fowke said, adding that the city would lose approximately $420,000 in investment earnings as a result of a month’s delay.
Although he stood behind the motion’s intent, Parent told Sudbury.com after Tuesday’s meeting that he couldn’t justify the lost earnings.
For a residential property with an assessed value of $230,000, this year’s total municipal and education tax burden under the city’s area rating model, will be:
- Career/Urban (former City of Sudbury): $3,794, which includes a 2023 increase of 3.7-per-cent increase ($136)
- Composite/commuter (former City of Valley East): $3,659, which includes a 2023 increase of 6.4 per cent ($221)
- Volunteer/commuter (most all other areas of the City of Greater Sudbury): $3,476, which includes a 2023 increase of 4.9 per cent ($161)
- Volunteer (formerly unorganized areas): $3,343, which includes a 2023 increase of 5.2 per cent ($164).
The balance of the city’s tax implementation plan to pay for 2023 budget decisions was also approved on Tuesday..
Factoring in both municipal and education taxes, residential properties across Greater Sudbury are slated to jump by an average of 4.5 per cent, commercial properties face a 3.4-per-cent tax increase and industrial property taxes will go up by 2.3 per cent.
Industrial taxes are going up by a lesser degree due to the city easing down industrial tax ratios due to their current 3.59 for industrial (and 4.168 for large industrial) exceeding the provincial threshold of 2.63.
These numbers are in comparison to one for residential, meaning industrial property owners pay 3.59 times more on property taxes than residential property owners.
The city has reduced the industrial tax ratios slightly each year, resulting in $650,000 in tax revenue shifting from industrial properties to other property classes in 2023. All other ratios remain unchanged.
The 2023 tax ratios are as follows:
- Residential: 1
- New multi-residential: 1
- Multi-residential: 1.965
- Commercial: 1.912
- Industrial 3.536525
- Large industrial: 4.105129
- Pipelines: 2.179489
- Farm: 0.2
- Managed forest: 0.25
Although the 2023 tax implementation plan approval still needs to be ratified by city council as a whole at a future meeting, Tuesday’s unanimous support points to a likelihood it will be approved.
During Wednesday’s meeting, Ward 11 Coun. Bill Leduc sussed out a point of clarification regarding this year’s firefighting training expense.*
The total jump in this year’s training expenses due to a provincial requirement is approximately $770,000, Fowke clarified, of which $120,000 was allocated to the three stations in the former City of Valley East. The preamble to the motion Parent and Lapierre initially planned on tabling cited the $770,000 figure.*
*Editor’s note: These two paragraphs were added after the story was initially published.
Tyler Clarke covers city hall and political affairs for Sudbury.com.
