Revelstoke revitalization tax exemption bylaw gets flat response

City staff flag issues with plan to create revitalization tax breaks, saying it's a big undertaking that needs to be considered carefully

City hall staff have given a proposed Revelstoke revitalization tax exemption bylaw a very tepid response, sending city council a report on the proposed bylaw that states why it’s not a good idea.

The proposed revitalization bylaw would give limited, temporary tax breaks to commercial property owners who improve their properties, or develop new ones. The idea is to offset the additional taxes property owners must pay because the improvements boost their property assessments, and therefore their taxes.

The discussion was prompted by request to council by Mt. Begbie Brewing Co. president Bart Larson, who is planning to build a new brewery, but says taxation levels in Revelstoke are prohibitive. Larson asked council to take action to reduce commercial property tax rates.

Council requested staff explore options, and the revitalization tax exemption bylaw was proposed. The bylaw is allowed for under provincial regulations.

However, a Jan. 21 report signed by staff from the finance, development services and economic development offices lists downsides.

First, they say the bylaw is typically geographically focused, designed to revitalize a certain area of town.

They say the revitalization bylaw should be supported by basic planning documents like the official community plan, which doesn’t currently support a revitalization bylaw.

In general, in the report staff express concern about the process leading to the proposed bylaw, saying there will be fairness issues if it’s perceived to be a special case bylaw. “If the scope is narrowed significantly to say, encourage the development of breweries in the community, how will this be viewed by other potential developers? Furthermore, how does a narrow scope of this nature meet Council’s goals and objectives?” they write.

Furthermore, they warn an unfocused, ad hoc bylaw could lead to unintended consequences down the road. Others would likely take advantage of the bylaw, eating into city tax revenues.

“The current consideration of a tax exemption bylaw is reactive to a specific situation when the full implications of utilizing such a tool would be better appreciated if discussed in a broader context,” they write.

Finally, city staff warn that developing the bylaw is time-consuming and costly.

They make no recommendation, other than to ask for council direction. The item is up for discussion at council’s Jan. 28 regular meeting.

In a story published in the Jan. 22 Times Review, brewery president Larson said the bylaw is key to brewery development plans.  “Proceeding depends a lot on this revitalization tax [bylaw],” Larson said.

***

For an update on this story, see the Feb. 5 print issue of the Revelstoke Times Review.

 

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