Over the past number of years we have experienced an increase in our assessed value for our homes; I am sure most of us are amazed that the house we purchased 15 years ago has more than doubled in price. That is a good thing if we were in the housing market 15 years ago, though this places pressure on young adults attempting to get into the housing market. However, there is another aspect of sky rocketing property values that goes unnoticed, that is how does increased property value affect our local businesses?

The past two years we have seen an increase averaging approximately 45% for ten businesses in our community, with two realizing an 80% increase in 2010. As a result their property tax will go up a similar amount. How? If the average property assessment for industrial properties goes up 3% but one property goes up 80%, the property tax rate is based on the average property value increase, which in this case is 3%. The difference of 77% will result in this one property’s property tax going up by 77% higher than the average. Year over year these impacts hurt our local businesses; it is not like the business has the ability to react or increase their revenue in the same time period, and the result is a reduction in their operating budget which could result in the loss of employment.

Local governments do not have the ability to reduce the increase property taxes to one property owner, nor do we have the ability to smooth the increase out over 10 years. These are the laws set out in the Community Charter, which is managed by the Provincial government.

Last year I wrote a letter to the Minister of Community, Sport and Cultural Development suggesting that the Ministry should work with BC Assessment to consider the option of re-adjusting the assessment calculation for properties that have major assessment value increases in a given year and to spread the increase over several years.

As local governments we are always working hard to keep our property taxes as low as possible and to maintain a livable community, where our residents can work and live in the same community. However, with businesses being pulled in many directions and many of them being recruited to relocate to the US and elsewhere we need to be working together to reduce the sudden increase in property values that result in an increase in property tax.