March 23, 1998
To: Corporate Services Committee
From: Chief Financial Officer and Treasurer
Subject: STRIKE-OFF OF UNCOLLECTIBLE BUSINESS TAXES FROM THE COLLECTORS ROLL
Purpose:
This report addresses the uncollectable business taxes still on the Tax Collector=s Roll. These business taxes can be struck from the Tax Collector=s Roll under the provisions of Section 441 of the Municipal Act. R.S.O. 1990. The Section 441 process differs from other tax related adjustments because only Council can approve the strike-offs being removed from the Roll and does not include cancellation of taxes due to assessment appeals (i.e. the Section 442 process).
Financial Implications:
The amount of business taxes that require removal from the Tax Collector=s Roll is $11,837,264.91 plus $102,583.84 attributable to Business Improvement Areas (BIA). Approximately $5,197,659.33 of this amount is the City=s Share. Provision for the City=s share has been made in the 1998 budget. The balance of approximately $6,639,605.58 is the School Board=s share and will be recovered. The amount of $102,583.84 for Business Improvement Areas (BIA) for the former City of Toronto is offset by an allowance amount set aside for this purpose as part of the BIA levy and does not have an impact to the City. A breakdown of each Area District=s distributions is outlined in APPENDIX A in summary and APPENDIX B in detail.
Recommendations:
It is recommended that:
1. Council resolve to cancel the uncollectable business taxes of $11,837,264.51 and strike them from the Tax Collector=s Roll under the provisions of Section 441 of the Municipal Act, and;
2. That the amount attributable to uncollectible taxes from Business Improvement Areas (BIA) in the amount of $102,583.84 be stricken off as a receivable under Section 441.
Background
All accounts have gone through our collection process. This process includes Overdue Statements, Final Demand Letters, Bailiff Warrants and investigations, Collection Agency action and Legal action. In certain cases, payment arrangements were entered into between the taxpayers and the City. Unfortunately, due to Bankruptcies and business closures, we were unable to collect all of the total outstanding amounts. These business taxes are uncollectable in accordance with Section 441 of the Municipal Act.
Conclusions:
The list of uncollectable business taxes has been reviewed and edited by the Tax Collectors in each area district. The final detailed lists can be viewed at the Clerk=s Office. All appropriate collection action has been performed and the Treasurer has ascertained the taxes to be uncollectable. It is recommended that Council cancel the uncollectable business taxes and strike them from the Tax Collector=s Roll.
Contact Name:
Ed DeSousa
Director, Tax and Water - Etobicoke Division
Phone: 397-4226
Fax: 392-3649
Barbara Murray
Manager of Revenue - York Division
Phone: 394-2573
Fax: 394-2578
E-Mail: bmurr@City_of_York.Eglinton Ave.
W. A. Liczyk,
Chief Financial Officer and Treasurer
