TOWNSHIP OF ESQUIMALT STAFF REPORT
MEETING DATE: October 7, 2024 Report No. FIN-24-016
TO: Council
FROM: Ian Irvine, Director of Financial Services
SUBJECT: 2025 Permissive Tax Exemptions
RECOMMENDATION:
Recommendation
That Council:
1. Give first, second, and third reading to Permissive Tax Exemption Bylaw (Non-Profit Organizations), 2024, No. 3147; and
2. Give first, second, and third reading to Permissive Tax Exemption Bylaw (Places of Worship), 2024, No. 3148.
Body
EXECUTIVE SUMMARY:
The Community Charter gives Council the authority to grant permissive exemptions from property taxes for a period of up to 10 years. For organizations to receive exemptions, Council must adopt a bylaw and, prior to its adoption, ensure adequate notification in accordance with the Community Charter. Statutory exemptions are provided for places of worship and the land on which they sit but any additional exemptions that Council wishes to grant for other land and improvements on these parcels must be adopted through bylaw.
The Local Grant Committee reviewed all applications from not-for-profit and places of worship organizations and made recommendations about exemption percentages and duration. These recommendations have been incorporated into the two bylaws attached to this staff report. These bylaws must be adopted prior to October 31 for the exemptions to take effect and be in place for the 2025 taxation year.
BACKGROUND:
The Community Charter includes sections which provide the means for various organizations and entities to receive exemptions from taxation if they meet certain criteria. Some of the exemptions are statutory in nature while others are at the discretion of local government.
Section 224 gives Council the authority to grant permissive exemptions from property taxes for a period of up to 10 years. Council must adopt a bylaw and, prior to its adoption, ensure notification of the proposed exemptions is adequately advertised within the municipality.
Section 220 provides a statutory exemption for properties identified as places of worship. Under this provision, the building and the land on which it sits, receive an exemption which is not at the discretion of Council. In most instances, parcels which include a place of worship, will also have accessory buildings, residences, and additional land such as parking lots which are not part of the statutory exemption. Organizations seeking an exemption for these additional land and improvements are required to submit a formal application to be considered by the Committee, similar to the permissive tax exemption requests from not-for-profit organizations.
Previously Approved Exemptions
The current permissive tax exemption bylaw pertaining to places of worship was adopted in 2014 and will expire at the end of this taxation year. Within that bylaw, places of worship organizations received full exemptions for all additional land and improvements except for any properties classified as residential.
In October 2023, Council approved permissive tax exemptions for several not-for-profit organizations. The following exemptions were approved annually for four years at varying percentages.
Full Exemption
City of Victoria
Esquimalt Angler’s Association
Esquimalt Neighbourhood House Society
Habitat Acquisition Trust
WITS Programs Foundation
75% Exemption
Boys & Girls Club South Vancouver Island
Compassionate Resource Warehouse Society
50% Exemption
PEERS Victoria Resource Society
25% Exemption
Fraternal Order of Eagles
Island Community Mental Health Association
Mustard Seed Street Church
Victoria Association of Community Living
Victoria On Stage Musical Theatre
Council also approved a full permissive tax exemption to the Island Corridor Foundation during the 2024 taxation year only. It was communicated to the Foundation that they would need to submit a new application if they were seeking exemptions for future years.
ANALYSIS:
Prior to the August 31, 2024 deadline, the Township received permissive tax exemption applications from not-for-profit organizations, the City of Victoria and places of worship organizations. In addition, three properties which the Township owns or leases, were presented to the Committee. At a meeting held on September 9, 2024, the Local Grant Committee discussed the applications and made the following recommendations relating to permissive tax exemptions for the 2025, 2026 and 2027 taxation years.
Not-for Profit Organizations
Island Corridor Foundation - 100% - 2025 only
Royal Canadian Legion - 50% - 2025, 2026 and 2027
Municipal Owned/Leased
City of Victoria - 100% - 2025 only
Esquimalt Archives - 100% - 2025, 2026 and 2027
Esquimalt Library - 100% - 2025, 2026 and 2027
Esquimalt Town Square (shared parking lot) - 100% - 2025, 2026 and 2027
Places of Worship
The following exemptions are recommended for land and improvements that are not part of the statutory exemption:
2025: 75%
2026: 75%
2027: 50%
Esquimalt United Church
Anglican Synod of the Diocese (excluding Class 1 assessment)
Church of the Nazarene
Our Lady Queen of Peace
Van Hahn Buddhist Society (excluding Class 1 assessment)
Aga Khan Foundation Canada
These recommendations, and the exemptions approved last year, have been incorporated into the bylaws attached to this staff report.
OPTIONS:
1. Council could approve the recommendations of the Local Grant Committee and give first three readings to each of the two permissive tax exemption bylaws attached to this staff report.
2. Council could make amendments to either of the permissive tax exemption bylaws and give first three readings to the bylaws as amended.
3. Council could request more information from staff regarding the permissive tax exemption applications or recipients.
COUNCIL PRIORITY:
Engaged and Healthy Community
FINANCIAL IMPACT:
Upon adoption of the bylaw, recipients will not be required to remit property taxes related to the exempted land and improvements. The following table illustrates the actual value of 2024 permissive tax exemptions provided by the Township. Additionally, based on the Local Grant Committee recommendations, the estimated 2025 exemptions from municipal and total taxes are included. The table also discloses the total amount of non-statutory exemptions that will be granted to organizations operating places of worship based on the Committee’s recommendations.
Not-for-Profit Organizations
|
Year |
Municipal |
Total |
|
2024 actual |
$78,132 |
$144,871 |
|
2025 estimated |
91,233 |
165,599 |
|
2026 |
84,544 |
153,918 |
|
2027 |
87,080 |
158,535 |
Places of Worship Organizations - Non-Statutory
|
YearMunicipalTotal |
|
|
|
2024 actual |
$29,975 |
$57,568 |
|
2025 estimated |
23,155 |
44,471 |
|
2026 |
23,850 |
45,805 |
|
2027 |
16,377 |
31,453 |
For all recommended exemptions, the estimated exemption amounts for 2026 and 2027 are disclosed as required by the Community Charter. The required notification includes any properties which are municipally occupied by the Township however, these amounts are excluded from the table.
COMMUNICATIONS/ENGAGEMENT:
A copy of this year’s public notice is attached to this report for your information and this notice will be given in accordance with Public Notice Bylaw, 2024, No. 3136. Once adopted, the bylaws will be provided to BC Assessment in advance of its October 31, 2024 deadline for application during the 2025 taxation year.
TIMELINES & NEXT STEPS:
Following first three readings of the bylaws, the Township will ensure the proper communication is provided. The bylaws will be brought back to Council for adoption at the October 28 meeting. Subsequently, both bylaws and all attached schedules will be provided to BC Assessment for application during the 2025 taxation year for all recipients.
REPORT REVIEWED BY:
1. Deb Hopkins, Director of Corporate Services, Reviewed
2. Dan Horan, Chief Administrative Officer, Concurrence
LIST OF ATTACHMENTS:
1. Permissive Tax Exemption (Non-Profit Organizations) Bylaw, 2024, No. 3147
2. Appendix A - Bylaw 3147
3. Appendix B - Bylaw 3147
4. Permissive Tax Exemption (Places of Worship) Bylaw, 2024, No. 3148
5. 2025 Permissive Tax Exemptions Ad
6. Council Policy FIN-16 Permissive Tax Exemptions