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A lesson in biz taxes from city, Chamber
Coquitlam council plans to extend an olive branch to the small business community after it got an earful of complaints earlier this month about the cost to set up shop in the municipality.
This week, Mayor Richard Stewart and city managers said they will reach out to small business owners to help them learn about the taxation process.
David Munro, Coquitlam’s economic development manager, said a meeting will be set up later this year or early in 2014 — in partnership with the Tri-Cities’ Chamber of Commerce and the BC Assessment Authority — to educate local business owners about roles and responsibilities in terms of tax rates and collection, and how business owners can resolve issues.
The move comes after several small business owners joined the Canadian Federation of Independent Business (CFIB) at a townhall in Coquitlam on Oct. 3 to press council to lower the property tax rate as it heads into 2014 budget talks next month. Many business owners told council they are suffering financially due to the steep tax bills and other related expenses.
At Monday’s council in committee meeting, Mayor Stewart said the outreach program will aim to give advice to small business owners, many of whom don’t do their research before they open their doors, he said.
Stewart also said the businesses in the area around the Evergreen Line will likely face higher tax invoices as the line is built over the next three years, just as tax bills rose for Richmond retailers when the Canada Line was completed. That city council was forced to take measures to ease the tax burden for business owners who saw their bills jump thousands of dollars because of higher assessments with the real estate market heating up.
Coun. Mae Reid said many of Coquitlam’s small business owners are not only new to the city but new to the country. She said a "Taxation 101" course by the city would be helpful to those struggling to make ends meet.
Coquitlam needs to be “progressive and proactive” in dealing with businesses, she said, as they are "the bread and butter of our community."
According to the fall 2013 survey by the Vancouver chapter of the Commercial Real Estate Development Association (NAIOP), Coquitlam ranks 15th out of 18 Lower Mainland municipalities for its ratio of light industrial/commercial-to-residential tax rates (New Westminster, Port Moody and North Vancouver district were ranked lower while Port Coquitlam placed 10th).
Currently in Coquitlam, the ratio of property taxes on light industrial and commercial properties is 4.452 to 1 — meaning the city collects, per thousand dollars of assessed value, almost four and a half times more on business properties than it does on residential properties. And that's well above NAIOP's ideal median of 3:1, something that isn’t being achieved by half of the municipalities surveyed (see sidebar).
Still, the NAIOP report indicates Coquitlam has made strides over the past two years in its dealings with businesses and developers, with processing permit times down 29% and fees for items such as sprinkler inspections, development cost charges and rezonings also on the decline since 2011.
Meanwhile, also at Monday's council in committee, John DuMont, Coquitlam’s deputy city manager, said in his second trimester report that development is on a "consistent" trend with last year, with construction values at $243 million as of Aug. 31.
DuMont also anticipates there to be a balanced budget — or a “small surplus” — by year end for the city.
Light industrial/commercial to residential tax ratio, according to NAIOP 2013 fall survey:
Chilliwack — 2.071
Abbotsford — 2.157
Langley — 2.575
Surrey — 2.629
Maple Ridge — 2.855
Mission — 2.912
Langley township — 3.026
Delta — 3.208
North Vancouver city — 3.526
Port Coquitlam — 3.540
Richmond — 3.832
Burnaby — 4.22
Pitt Meadows — 4.297
Vancouver — 4.329
Coquitlam — 4.452
North Vancouver district — 4.604
Port Moody — 5.482
New Westminster — 5.802