An agreement with the Northern Water Sports Centre that it would pay taxes made no sense and should never have been signed, city councillors said Tuesday.
So members of the finance committee voted to forgive the centre's $38,000 tax bill for 2016, and to make it exempt from taxes in the future. The full annual tax bill is $66,000.
Ward 10 Coun. Fern Cormier said the centre is owned by the city and is run by volunteers. Unlike groups that lease property from the city to operate a private club, the centre is accessible to everyone.
“This is a full partnership with the city,” Cormier said, comparing it to Bell Park. “It is a community asset. It's not exclusive. No member of the public is prohibited from going there.”
Since the city didn't collect taxes on the land before, Cormier said the city isn't really losing out on revenue.
“And these small groups provide, in my opinion, amazing value.”
The $4.6 million centre, located on the shores of Ramsey Lake, includes the Canoe Club, Rowing Club and Dragon Boat Festival as tenants. The city contributed more than $500,000 towards construction costs, and agreed to pay 35 per cent of annual operating costs, or $30,000.
As part of this arrangement, the centre agreed in a memorandum of understanding in 2013 to pay all property taxes on the centre.
As staff report on the issue recommended against providing the tax relief, since it could lead to other groups in similar circumstances coming forward to ask for the same treatment.
“This action may encourage other groups occupying similar facilities to approach council in an effort to be treated in the same fashion,” the report said.
“A previous report requesting that the Family Health Team's facilities be deemed municipal capital facilities and therefore becoming tax exempt was presented for consideration to the finance and administration committee and was denied.”
However, some councillors said the comparison to the Family Health Teams was inaccurate, since doctors are not volunteers and are paid for their services.
And Mayor Brian Bigger pointed out the Dragon Boat Festival has raised more than $1.5 million for charity.
“The building owned by the city, it's insured by the city and bookings are controlled by the city. Certainly, it works like a city facility."
