Greater Sudbury's indoor tennis centre at Queen's Athletic Field is asking city council to change its status to allow it to operate without paying municipal property taxes.
Otherwise, the group says it can't pay the $48,000 it currently owes and will have to close.
A report headed to the city's finance committee June 4 says the root of the problem is a 2017 decision by the Municipal Property Assessment Corporation (MPAC) that the property is subject to taxation. While located on city land, the group has been leasing the property since 1992.
“As per the lease, there was no rent payable and the club was to be responsible for property taxes, if assessed,” says the report to the committee.
MPAC ruled in 2017 the centre was subject to property taxes, and that it owed a total of $33,736 for 2016 and 2017. With 2018 included, the total owing is about $48,000, with another $6,700 due this year.
When staff sent the club a letter outlining payment options, members passed a resolution that said they have never paid taxes in the past, and can't afford to suddenly included the unbudgeted costs to their budget.
The club is seeking similar status as the Northern Water Sports Centre, which was deemed a municipal facility – and therefore exempt from property taxes – in 2017. The centre -- which originally agreed to pay taxes – successfully argued that it was essentially a municipal facility and shouldn't have to pay its $66,0000 tax bill.
The indoor tennis club says it is seeking the same treatment to ensure it can keep operating.
“The board regrets to have to advise the city that should the club not be so deemed (as tax-free), the club will be forced to close as it will no longer be financially viable.”
In addition to the tax bill, the club is also facing a $175,000 bill to replace the HVAC system that keeps the bubble inflated. Financial statements provided to the city by the club shows a total of $181,951 in revenue and $182,051 in expenses for the year ending June 30, 2017. Revenue totals include $99,058 collected in court fees and $33,051 collected from membership fees.
The report includes four options: insist the club pay its taxes, which could lead it to close; give them a grant to pay off the bill, and then work with them to come up with a plan on how to pay their taxes in the future; provide them with an annual grant equivalent to their tax bill; or, deem them a municipal asset and exempt them from taxes.
The report recommends the first or second option, and strongly opposes the last option.
“Although the Sudbury Indoor Tennis Centre has requested to be treated like the Northern Water Sports Centre, the Northern Water Sports Centre is a shared use facility, with the city and tenant each using and programming space,” the report says. “This option also has the greatest negative impact on the tax levy.”
