eo t~~ COUNCIL REPORT ABBOTSFORD
Report No.COR16-2012 Executive Committee March 14, 2012 File No: 1970-01/2010-01
To: Mayor and Council From: Pat Soanes, General Manager, Finance & Corporate Services Subject: Province of British Columbia Reviews of Business Taxation and Local Government Revenue Sources
RECOMMENDATIONS:
1. THAT Report No. COR16-2012, dated March 14, 2012, from the General Manager, Finance & Corporate Services, regarding the Province of British Columbia Reviews of Business Taxation and Local Government Revenue Sources, be received,and;
2. THAT Council notify the Premier of British Columbia in writing of its desire to have local government representation on the Expert Review Panels.
BACKGROUND
On January 10, 2012, Finance Minister Kevin Falcon announced the appointment of an Expert Panel to provide analysis and recommendations regarding the system of business taxation in British Columbia. Appointments to the Panel included academics, business people, a representative from the Canadian Federation of Independent Business, and professional accountants. In addition to work relating to streamlining the Provincial Sales Tax, the review will include an examination of municipal property taxation on business and its impact on business competitiveness and investment.
In order to supplement the work of the Expert Panel, the Ministry of Community, Sport and Cultural Development has notified the Union of BC Municipalities (UBCM) of an additional Local Government Revenue Sources Review.
Both Reviews are expected to be completed by August of this year. The Member Release from UBCM is attached as Appendix A.
ANALYSIS
The Honourable Ida Chong, Minister for Community, Sport and Cultural Development, attended a recent UBCM Executive Meeting and concern was expressed by the Executive regarding the lack of local government representation on the Expert Panel. Since that time, many Councils from across the province have considered and passed resolutions calling on the Premier to include local government representatives on the Expert Panel. To date, the City of Abbotsford has received correspondence from the City of Cranbrook, the District of Coldstream, the District of Kent, the Village of Telkwa, the City of Port Alberni, and the City of Trail. In all instances these Councils passed resolutions to express their concerns in writing to the Premier. Copies of the resulting correspondence are attached as Appendix B. Report No. COR16-2012 Page 2 of 2
As a statutory entity, the City of Abbotsford is completely reliant on the regulatory revenue sources as set out in the Community Charter. While the Province has committed to consultation with local governments, given the importance of the Reviews to all municipalities, it is difficult to ensure that the local government perspective is adequately reflected in any recommendations without there being direct involvement and participation on the Expert Panel.
FINANCIAL PLAN IMPLICATION
There are no direct Financial Plan Implications associated with this report. However, the City of Abbotsford and its fiscal sustainability has very much a vested interest in the outcomes and recommendations of the Expert Panel and the two Reviews.
STRATEGIC DIRECTIONS
Achieve Economic and Fiscal Balance and Promote Economic Competitiveness and Innovation
SUMMARY
Direct participation of local government as a representative on the Expert Panel is vital to ensure there is appropriate and adequate input to the two Reviews currently under way by the Province. Council may wish to add its voice to the growing number of municipalities that have expressed concern in writing to the Premier over the lack of local government representation.
Pat Soanes, CMA General Manager, Finance & Corporate Services
Attach. REPORT NO. COR16-2012 APPENDIX A
MEMBER RELEASE February 10, 2012
TO: Mayor and Council; Chair and Board; Senior Staff FROM: Heath Slee, President
RE: Province To Review Municipal Taxation and local Government Revenue
The Province of British Columbia is undertaking two reviews of direct interest to local government: an Expert Panel Review of Business Taxation and a Local Government Revenue Sources Review. I am writing to provide background on both of these initiatives.
1. Expert Panel Review of Business Taxation
On January 10, Finance Minister Kevin Falcon announced the appointment of an Expert Panel to provide analysis and recommendations regarding the system of business taxation in British Columbia. The panel will also make recommendations for administrative improvements that streamline the Provincial Sales Tax. This initiative is under the "Canada Starts Here: The BC Jobs Plan", and the panel must report by August 31, 2012.
The guidelines for the Expert Panel state that "(t)he review will include an examination of municipal property taxation of business and its impact on business competitiveness and investment. Recommendations must address issues of affordability and sustainability for local governments within the framework of the Community Charter."
Panel members are: • Sarah Morgan-Silvester, Chancellor, University of British Columbia • Lindsay Hall, Chief Financial Officer, Goldcorp • Laura Jones, Senior VP, Canadian Federation of Independent Business • Elio Luongo, Canadian Managing Partner, KPMG • Fiona Macfarlane, Managing Partner, Ernst & Young • Grace Wong, VP Academic, University of British Columbia • Dale Wall, former Deputy Minister, Province of BC (adjunct member)
The full text of the news release and terms of reference for the panel are available here: http://www2.news.gov.bc.ca/newsreleases2009··-2013/2012FIN0002-·000ma.htm .
2. local Government Revenue Sources Review
The Ministry of Community, Sport and Cultural Development has advised UBCM that, in order to supplement the work of the Expert Panel Review of Business Taxation, and to fully
ubcm.ca meet the Premier's commitment to review the municipal tax formula, the Ministry is embarking on a Local Government Revenue Sources Review.
The terms of reference for that review are not yet complete, but UBCM has been provided with some preliminary briefing material.
At this point, it appears that the review will encompass both municipal and regional district revenues from all sources, including property and other taxes, fees, grants and other transfers. The review is expected to determine trends over time and to consider whether grants are meeting the needs of the provincial government. A literature review and some form of inter-jurisdictional analysis are also expected, as is an analysis of the municipal tax policy objectives set out in municipal financial plans in Be.
The review is expected to be completed by July 31, 2012 and may provide context and background to recommendations of the Expert Panel and/or further policy change.
3. UBCM Engagement
Both reviews were topics of discussion during the meeting of UBCM's Executive of February 3, 2012. During the portion of the meeting where we were joined by Ida Chong, Minister of Community, Sport and Cultural Development, the Executive noted that local governments would be concerned that a panel investigating municipal taxation lacks local government representation. The Executive also commented that the composition of the Expert Panel might lead to questioning of its recommendations.
In terms of next steps, UBCM will contact the Expert Panel to express interest in providing a presentation. I have also written to Minister Chong to say that UBCM would be pleased to work collaboratively on the Revenue Sources Review. The Executive will also consider options to ensure that the perspective of local government with regard to business taxation and local government revenue is both heard and understood. UBCM will keep watch on both reviews as they get underway, and will provide updates as substantive information becomes available.
ubcrn.ca REPORT NO. COR16-2012 APPENDIX B
CORRESPONDENCE FROM:
City of Cranbrook District of Cold stream District of Kent Village of Telkwa City of Port Alberni City of Trail MOUNTAINS OF OPPORTUNITY CRANBROOI( February 20,2012
The Honourable Christy Clark Premier of British Columbia PO Box 9041 Station PROV GOVT Victoria, BC V8W 9E2
Dear Premier Clark:
Re: Expert Panel Review of Business Taxation And Local Government Revenue Sources Review
At our meeting held February 20, 2012, Council discussed the above and adopted the following resolution:
"THAT a letter be sent to the BC Premier, with copies to the Minister responsible for Community, Sport and Cultural development, the local MLA, the UBCM member municipalities, which indicates the City of Cranbrook's objection to the composition of the "Expert Panel" in that there are no panel representatives from local government municipalities."
Our Council respectfully requests that consideration be given to including local government elected member and staff representation on the Expert panel assembled.
If you have any questions please feel free to contact me at 250-489-0200.
Sincerely, J?~ Wayne l. Stetski Mayor
Copy: I. Chong, Minister responsible for Community, Sport and Cultural Development B.Bennett, MLA - East Kootenay H. Slee, President, UBCM UBCM Member Municipalities 85
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OFFICE OF THE MAYOR File: 0230-50
February 16,2012
The Honourable Christy Clark Premier of British Columbia PO Box 9041 Station PROV GOVT Victoria BC V8W 9E2
Dear Premier Clark:
Re: Expert Panel Review of Business Taxation And Local Government Revenue Sources Review
At our meeting held February 13,2012, Council discussed the above ,md adopted the following resolution:
.,-f' "THAT a leiter be sent to the BC Premier, with copies to the i'viinisler responsible jor Community, Sporl and Cultural Development, the local MLA, the UBCM and the UBC!'v! member municipalities, which indicates the District of Cold<;tream's objection /0 the composition of the "Expert Panel" in thaI there are no panel member representatives
ji-mn local government municipalities. ff
Our Council respectfulllrequests that consideration be given to including local government elected member and staff representation on the Expert Pcmel assembled.
If you have ,my questions please feel free to contact me at 25{)-545 ~ 5304.
Sincerely, __'- ;?-/:/" ~L Jim GarlicIf' Mayor
CC 1. Chong, Minister Responsible for Community, Sport and Cultural Development E. Foster, MLA-· Vernon-Monashee H. Slee, President, UBCM UBCM Member Municipalities
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March 7, 2012
FILE: 0400-50
The Honourable Christy Clark Premier of British Columbia P.O. Box 9041 Stn Prov Govt Victoria, BC V8W 9E2
Dear Premier Clark:
RE: Expert Panel Review of Business Taxation And Local Government Revenue Sources Review
At its Regular meeting held February 27,2012 Council received the letter from the District of Coldstream dated February 16, 2011 with respect to the Expert Panel Review of Business Taxation and Local Government Revenue Sources Review (copy attached).
As a result of this information, Council passed the following resolution:
"THA T the District supports the resolution of the District of Goldstream concerning the lack of local government representatives on the Provincial Expert Panel Review of Business Taxation". (R2012-077)
The District of Kent respectfully requests that consideration be given to including local government elected member and staff representation on the Expert Panel assembled to ensure that the perspective of local government in terms of business taxation is heard and understood.
If you have any questions with respect to this letter please contact me by telephone at 604-796-2235 or by email [email protected]
Sincerely,
John Van Laerhoven Mayor pc: The Honourable Ida Chong, Minister of Community, Sport and Cultural Development Mayor Jim Garlick, District of Coldstream Mr. Heath Slee, President. UBCM UBCM Member Municipalities T~
March 1,2012
The Honourable Christy Clark Premier ofthe Province of British Columbia PO Box 9041, STN PROV GOVT Victoria, BC V8W9E2
Dear Premier Clark:
Re: Expert Panel Review ofBusiness Taxation and Local Government Revenue Sources Review
At the general meeting on February 27,2012, Village of Telkwa Council resolved as follows:
TO draft a letter to the BC Premier, with copies to the Minister responsible for Community, Sport and Cultural Development, the local MLA, the UBCM and the UBCM member municipalities, which indicates the Village of TelkWa objection to the composition of the "I;:xpert. Panel" in that there are no panel member representatives from local govemment municipalities. .
We would respectfully request that the composition of the Expert Panel be restructured to include representation by local government municipalities.
Please contact i:ne if you have any questions or require further clarification of the aforementioned resolution.
Sincerely, The Corporation of the Village ofTelkwa
per/ ~.~.. 7~ CmmanGraf Mayor
Cc: Ida Chong, Minister Responsible for Community, Sport and Cultural Development Doug Donaldson, MLA for Stikine H. Slee, President, UBCM UBCM Member Municipalities
VILLAGEOFTELKWA. PO BOX 220. 1415 HANKIN AVENUE. TELKWA,BC VOJ2XO PH: 250.846.5212 [email protected] FAX: 250.846.9572 C~TY OF PORT AlBERNi City Hall 4850 Argyle Street, Port Alberni, B.C. V9Y 1 V8 Telephone: 250-723-2146 Fax: 250-723-1003 www.portalberni.ca
March 1, 2012
Honourable Kevin Falcon Minister of Finance PO Box 9048 Stn. Provo Govt Victoria, BC V8W 9E2
Dear Minister Falcon:
At a regular meeting on February 2ih, 2012, Council for the City of Port Alberni received information and background regarding the Expert Panel appointed to provide analysis and recommendations regarding the system of business taxation in British Columbia.
The guidelines for the Expert Panel state that "the review will include an examination of municipal property taxation of business and its impact on business competitiveness and investment. Recommendations must address issues of affordability and sustain ability for local governments within the framework of the Community Charter."
The City of Port Alberni wishes to express its concern and disappointment that the panel of experts appointed to review municipal taxation does not include representation from those impacted most by this issue - local governments.
Yours truly, CITY OF PORT ALBERNI J)01/;?,l? G;in /aUgla'S Mayor
C. UBCM
j:lclerks'-.confidentialladminislrationlmayorllettersI20121minister of finance_expert panel review on business taxation_mar1.docx March 5, 2012
Province of British Columbia Office of the Premier Attention: Honourable Christy Clark, Premier PO Box 21014 Waterfront Centre Vancouver, BC V6C 3K3
Dear Premier Clark:
RE: BUSINESS TAXATION AND REVENUE SOURCES REVIEW
Trail City Council recently received correspondence from the UBCM providing a summary of two reviews the Province is presently undertaking on the matters of Business Taxation and Local Government Revenue Sources. While Council was pleased to hear that the Province is critically assessing these matters of importance to local governments, we were very disappointed and concerned that the Expert Panel on Business Taxation lacks local government representation.
It would seem that those most impacted by the reviews - local governments - should be consulted and included in the reviews. We therefore ask that immediate action be taken to include local government representation on the Expert Panel pertaining to the Business Taxation Review. We would similarly request that local governments be well represented with respect to the Local Government Revenue Sources Review once underway,
We do hope to receive a favourable response to this request.
Sincerely,
Mayor
cc: Minister Chong, Ministry of Community, Sport and Cultural Development Minister Falcon, Ministry of Finance~ . President SJee, UBCM !'r ~ UBCM Member municipalities.a I A~L
City Hall • 1394 Pine Avenue, Trail, BC, Canada VIR 4E6 • Telephone: (250) 364-1262 • Fax: (250) 364-0830 Public Works. Telephone: (250) 364-0840 • Fax: (250) 364-0831 www.trall.ca • eMail: [email protected]