ADMINISTRATIVE REPORT
Dated: June 11, 1996
TO: Vancouver City Council
FROM: Director of Finance
SUBJECT: 1996 Permissive Tax Exemptions -
Community Care Facilities
RECOMMENDATION
A. THAT Council approve the amendment to Bylaw No.7524
authorizing the extension of a property tax exemption to the
Calling Foundation for 1996.
B. THAT Council approve the grants-in-lieu of general purposes
taxes to Community Care Facilities as detailed in Appendix A
and amounting to $196,779.24; source of funds to be
Contingency Reserve.
GENERAL MANAGER COMMENTS
The General Manager of Corporate Services RECOMMENDS approval of
A and B.
COUNCIL POLICY
The Vancouver Charter, Section 396, provides Council the authority to
approve limited permissive tax exemptions.
In February 23, 1995, Council approved the following tax exemption
policy for senior s housing and community care facilities:
- senior s housing completed before March 31, 1974 continues to
receive tax exemption;
- permissive tax exemptions to certain Community Care Facilities to
be phased out in 1996 and 1997; and
- all other facilities to be fully taxable.
PURPOSE
The purpose of this report is to submit for Council action a grant in
lieu of general purposes taxes for Community Care Facilities. Also,
there is a recommendation for an amendment to a bylaw recently
approved by Council which exempts certain senior s housing properties
from taxation in 1996.
BACKGROUND
Prior to 1974, senior s housing projects that received any form of
government assistance were exempted from taxation under Section 396
(1)(c) of the Vancouver Charter, provided they otherwise qualified for
tax exemption.
In 1974, the Provincial Government amended the Vancouver Charter by
adding section 396(1)(g), requiring new senior s housing projects in
receipt of provincial subsidies after March 31, 1974 to either:
- pay property taxes in the normal manner; or,
- obtain a permissive property tax exemption
from City Council.
A number of seniors housing projects receiving assistance before April
1, 1974, remained tax exempt under a 'grandfather' provision.
In 1987, the Provincial Government amended section 396(1)(g),
expanding on the types of properties that require annual approval of a
permissive tax exemption, with the following results:
- the 'grandfather provision for seniors housing projects
receiving assistance before April 1, 1974 was eliminated;
- the forms of provincial and federal assistance which made
projects eligible for exemptions were expanded;
- the outright exemption for community care facilities in
receipt of senior government assistance was removed.
On a number of occasions since the Charter changes discussed above,
Council has been asked to approve permissive exemptions on senior s
housing projects. To date, Council has maintained a policy of not
approving these requests, but has continued the exempt status of the
'grandfathered seniors housing projects. A similar policy has been
applied to Community Care Facilities in receipt of tax exemptions
before the 1987 Charter change.
On February 23, 1995, Council considered recommendations of the
Director of Finance related to exemptions for senior s housing and
community care facilities. At that time, Council agreed to continue
the tax exempt status of the 'grandfathered seniors housing (those
facilities completed before March 31, 1974). However, Council decided
to phase-out the permissive tax exemption for Community Care
Facilities that had previously received this exemption and to not
approve permissive exemptions for senior s housing which had not been
'grandfathered'.
DISCUSSION
Exemption for Seniors Housing
On February 27, 1996, Council approved By-law No. 7524 providing an
exemption for the 'grandfathered senior s housing projects for 1996.
Those properties are listed on that Appendix I.
There is one additional property omitted from the bylaw for which the
tax exemption should apply. This property had been improperly removed
from the list. Legal Services has been asked to prepare and submit a
bylaw that will amend Council s original approval by adding this
property to the bylaw.
Community Care Facilities
When considering the report of the Director of Finance on February 23,
1995, Council also approved the following recom-mendations related to
Community Care Facilities:
B. THAT Council approve 1995 permissive property tax
exemptions for the 'Community Care Facilities'
properties (shown in Appendix II of that report.)
C. THAT Council approve a phase-out of the permissive tax
exemptions on the 'Community Care Facilities'
properties (shown in Appendix II of that report )
commencing in the 1996 taxation year . . . and instruct
staff to give the affected property owners appropriate
notice of this change in policy.
On March 7, 1995 By-law No. 7395 was passed exempting these
properties from municipal taxation for the 1995 tax year.
For the 1996 taxation year, it was proposed that these Community Care
Facilities (listed in Appendix A) would not receive a property tax
exemption but would receive a phase-out grant equal to the municipal
portion of their tax bill. Administratively, this would be handled
by refunding the City's portion of the property taxes to the property
owners in the form of a grant under Section 206 of the Vancouver
Charter. Approval of these grants would reduce the property owner s
1996 property tax bill by approximately 50%.
If this grant request is approved, the funds will be applied against
the 1996 Property Taxes due on July 17, 1996( extended due date ) or,
if already paid by the date of receipt, refunded to the taxpayer. The
1996 Property Tax statements for these properties were mailed the week
of June 17th, 1996 together with a letter stating that this report
requesting the grant would be heard at this June 25, 1996 Council
meeting.
FINANCIAL IMPLICATIONS
The grants to community care facilities are put for Council
consideration in Recommendation B and will require eight votes to
pass. Should Council approve the grants, the cost will be $196,779.24
with funding to be provided from Contingency Reserve.
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