CBRM to make paying property taxes a little easier this year

Cape Breton regional councillors are planning to make it a little easier for people who have lost income due to COVID-19 to pay their property taxes.

Municipalities across Nova Scotia are expecting some difficulty collecting property taxes this year as many residents have lost their jobs and businesses have shut down during the state of emergency.

In order to qualify for a low-interest provincial loan to cover expenses, municipalities have to approve a policy allowing people up to 30 months to pay this year's levy.

John MacKinnon, CBRM's deputy chief administrative officer, said even though many people have taken a financial hit during the pandemic, the municipality still needs tax revenue to pay for services.

"One thing that's really important to say up front is that this is a tax financing program. It's not tax forgiveness," he told council during a meeting on Monday.

"It would be wonderful to be able to do something like that, but unfortunately it's just not possible that you can make everybody whole as part of this pandemic."

MacKinnon said CBRM staff estimate that up to $42 million in property taxes — about a third of all revenue — could be at risk this year.

He said the provincial association of municipal administrators and the federation of municipalities recommend a draft policy that would allow people up to 30 months to pay this year's taxes, under certain conditions.

Only those who can prove their income has been affected by COVID-19 would qualify. Residential properties would only be included if they have a dwelling on them and commercial property owners would have to prove they were not covered by business interruption insurance.

Tax deferral would only be allowed for Nova Scotia residents whose taxes are not in arrears.

The draft policy also lists several other criteria.

Coun. Earlene MacMullin said she wants eligibility to be as broad as possible, because she has dealt with a number of constituents who have been denied other federal or provincial funding.

"For example, an existing EI claim and things like that," she said. "I'd hate to see them fall through the cracks of this program as well, so I want to make sure that's something that we do have a safety net for."

MacKinnon said the tax policy wording can be made flexible to ensure most people are covered.

Under the proposal, taxpayers would be charged interest at the municipality's cost of borrowing plus an additional amount to cover administration of the program.

The Nova Scotia government is offering municipalities up to $380 million at a fixed interest rate of 1.1 per cent. If municipalities adopt the recommended administrative fee of .25 per cent, that would mean taxpayers can finance this year's taxes at a rate of 1.35 per cent.

Coun. Darren Bruckschwaiger said he wished CBRM could offer residents more help, but Coun. George MacDonald said the financing rate is a good deal for taxpayers.

"I sort of agree with Darren, to a certain extent, but where else in the province or where else in the world can you get that kind of money for 1.1 per cent?" he said.

Save the line of credit

CBRM has a line of credit with the province for $44 million that comes with a 1.45 per cent variable interest rate, but councillors and staff agreed that money would be needed to finance large capital projects this year.

They said the low-interest government loan would help with normal operating expenses while waiting for taxes to come in.

MacKinnon said it should be emphasized that residents who can pay their taxes should do so, to limit the amount of borrowing needed.

CBRM councillors expect to have a draft tax deferral policy ready for voting at next Tuesday's council meeting.

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