(rdnewsNOW file photo)

By Alessia Proietti

No change

Red Deer city council approves property and Business Improvement Area tax rates bylaws

Apr 17, 2023 | 10:57 PM

Red Deer city council approved the tax rate bylaws for annual properties and the Business Improvement Area (BIA) tax, which funds the Downtown Business Association (DBA).

At their meeting on Monday, council passed the required tax rate bylaws following the approved operating budgets for the property tax requirement and the 2023 DBA budget in December 2022.

PROPERTY TAX

The tax bylaw sets tax rates for requisitions The City collects on behalf of other organizations like the Alberta Education and Bridges Community Living. Requisitions comprise 25 per cent of an average residential tax bill.

The City’s budget was set with a 4.61 per cent tax increase. When combined with requisitions, the actual tax increase is 2.46 per cent for residential and non-residential properties and 6.64 per cent for multi-family properties.

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“We are pleased to be able to offer Red Deerians a lower than anticipated tax increase this year,” said Mayor Ken Johnston. “We know the economy is a challenge right now, so seeing this decrease, while also being able to offer the same high-quality services to our community, is a very welcome change.”

The tax increase means a typical house assessed at $345,000 will pay $6.79 per month more in total property tax. This brings the total annual tax bill to $3,388 from $3,306 in 2022, which is an increase of $81.48 annually.

“Taxes are collected annually to fund municipal services, infrastructure maintenance and amenities that support and enhance our community,” said Joanne Parkin, Revenue and Assessment Manager. “We encourage anyone who may not be able to pay their taxes by the deadline to pay as much as they can to reduce penalties, and to reach out to our office to discuss payment options.”

The deadline for payment of 2023 property taxes is June 30. Any unpaid taxes are subject to a six per cent penalty, lowered from the historical seven per cent. Penalties are applied to current year unpaid taxes on July 1 and September 1, and on taxes in arrears on January 1 and July 1. The City note this is the last year of lowered penalty rates that were provided to support recovery from the impacts of the pandemic.

Tax notices will be mailed May 23, 2023. Property owners can sign up by May 1 via MyCity (reddeer.ca/mycity) to receive their property tax notice electronically. Notices will be distributed by mail if electronic notification is not selected.

BUSINESS IMPROVEMENT AREA

The bylaw reflects decisions made during budget deliberations and is the final step allowing The City to collect the approved funds on behalf of the DBA.

READ: Downtown Business Association says area successful in 2022 with 131 events hosted

The BIA consists of 373 taxable businesses operating for more than 30 days in the BIA area. Roughly 35 per cent of the taxable businesses are taxed at the minimum rate set by the DBA board and will see a five per cent increase, or around $10. The remaining businesses will have an average increase of 28 per cent, which, for a BIA taxpayer with an assessment value of $32,100, equates to an increase of $131.

Map of the Greater Downtown Area within the black dotted line and the Business Improvement Area in blue. (Red Deer city council agenda April 17 meeting p. 184)

The last time the minimum tax was raised was in 2020 and the Board says a five per cent increase aligns with the 2023 tax revenue requirement increase. Council approved the transfer of funds to the DBA Board in the amount of $264,500.

Historically the number of taxable businesses in the DBA averaged 494 businesses from 2004 to 2016, showing a decline starting in 2017 but an increase from 2022. However, the Board says if the top DBA taxpayer moved out, the impact would be six per cent of the total tax revenue, an equivalent to 89 minimum taxpayers leaving the BIA area.

In 2022, 48 tax rolls or 12 per cent, of the total number of taxable BIA rolls were uncollectable and deemed as revenue losses from businesses that have moved out of the DBA, closed, or have not paid their taxes.

“Downtown is the vibrant heart of Red Deer and downtown businesses are paramount in providing centrally located services, entertainment, and places for our community to connect. It is the place we gather, host festivals, and enjoy arts and culture,” said Mayor Johnston. “The Downtown Business Association is an important partner in helping our community reach this vision, and these funds are necessary to continue momentum and bolster DBA grants and safety initiatives for all.”

BIA tax notices will be mailed May 23, 2023, and taxes are due June 30, 2023. Outstanding balances will be subject to penalties in accordance with the tax penalty bylaw.

The DBA and BIA were established in Red Deer in 1983. The DBA advocates for BIA members to attract new businesses and showcase a rewarding downtown experience. The DBA has 250 events planned for the year, including the weekly Downtown Market that runs on Wednesdays and live performances on Ross Street Patio.