Hey there, time traveller!
This article was published 12/10/2018 (462 days ago), so information in it may no longer be current.
Winnipeg mayoral candidate Jenny Motkaluk’s touted reform of the property tax system turns out to be a simple property tax rebate.
However, Motkaluk doesn’t recognize the rebate as a loss of tax revenue. On Friday, she offered a solution to make up the lost revenue in a manner one local lawyer says wouldn’t withstand a court challenge.
"There are examples, and lots of them, under the current system where specific homes end up with much higher (tax) increases and some homes that even end up with decreases," Motkaluk said at a news event at her St. James campaign headquarters.
"I don’t think it’s fair that I got a property tax decrease while other neighbourhoods had property tax increases far beyond" what council had approved last year.
On Thursday, Motkaluk had promised property taxes would only increase 1.16 per cent annually during the next four years if she’s elected mayor Oct. 24. She also promised that no owner of a home in which they lived would see an increase in their property tax bill of more than 1.16 per cent.
Normally, that’s not a promise politicians can keep, because property taxes are based on a property’s assessed value combined with the mill rate. While city hall collects a global amount from all property owners, the effect on individual owners would depend on whether the value of their property increased or decreased, or didn’t increase as much as others.
On Thursday, Motkaluk said she had found a way to manipulate how individual tax bills are calculated to ensure no one’s bill would increase more than 1.16 per cent. However, despite having honed the plan for six months, she could not explain how that would be accomplished.
That changed Friday, when she said she’d have city council approve individual tax rebates for any owner of an owner-occupied home whose property tax bill would be higher than 1.16 per cent.
The plan is similar to what councils have done in the past when giving rebates to downtown developers who build residential units, but Motkaluk would apply it citywide.
To make up the revenue, Motkaluk said the owners of all other owner-occupied homes whose tax bill would increase less than 1.16 per cent or even decrease from the previous year, will also have to pay 1.16 per cent more on their tax bill.
Lawyer Michael Mercury, who had ridiculed Motkaluk’s original plan, said Friday that tax rebates are legal, but the city doesn’t have the authority to impose a higher property tax than an owner would expect based on their assessment and the city’s mill rate.
"I’m really confused and don’t understand what she’s talking about," the veteran lawyer said. "What she’s planning to do amounts to imposing a surtax on people’s homes, and council doesn’t have the authority to do that.
"The property tax bill is a function of the property assessment and the mill rate, and council doesn’t have the power to impose a surtax on top of the property tax."
Mercury said if Motkaluk plans to give out rebates on the property tax bill, she’ll have to find a different way to make up for the revenue that’s not collected.
Motkaluk, however, insisted there is no cost associated with giving tax rebates to homeowners.
"It is not a cost," she said. "When you live in Winnipeg, everybody has to pay."
When pressed Friday, Motkaluk insisted city hall has the authority to impose property taxes greater than would be allowed according to the assessment and mill rate.
"The subject of taxes is a very complicated one, and it’s critically important that every (owner of a owner-occupied home) understand what my proposal means to them personally, once we clear the smoke and mirrors," the mayoral candidate said.
Motkaluk also said she was not prepared to say if she would freeze or increase frontage fees and water and sewer rates.
Aldo Santin is a veteran newspaper reporter who first carried a pen and notepad in 1978 and joined the Winnipeg Free Press in 1986, where he has covered a variety of beats and specialty areas including education, aboriginal issues, urban and downtown development. Santin has been covering city hall since 2013.
Updated on Saturday, October 13, 2018 at 7:52 AM CDT: Final
The Free Press Election Extra lets you know about everything that matters in 2018’s civic election. Receive it in your inbox three times a week until Election Day.Subscribe to Election Extra
By subscribing to the above e-mail alerts I agree to receive selected communications from Winnipeg Free Press, even if I have previously opted out from communications. E-mail preferences can be changed at any time under 'My Account->My Email Alerts'.