The Strategic Policies and Priorities Committee recommends the adoption of the recommendations embodied in the following transmittal letter (April 6, 1998) from the Chair of the Assessment and Tax Policy Task Force:

Recommendations:

On behalf of the members of the Assessment and Tax Policy Task Force who were present on April 6, 1998, I am forwarding the following recommendations to the Strategic Policies and Priorities Committee for consideration:

(1) That Council request the Government of Ontario and Legislature to hold public hearings on the announced new legislation to address problems with the new Current Value Assessment (CVA) system;

(2) That Council authorize the Chair of the Assessment and Tax Policy Task Force and the Chief Financial Officer and Treasurer to make representations to the Ontario Government and Legislature on recommended changes to provincial legislation and regulations regarding property assessment and property taxes; and

(3) That Council request the Government of Ontario and Legislature to amend the appropriate legislation to establish the preliminary tax rate study as a public record within the meaning of the Freedom of Information and Protection of Personal Privacy Act.

Comments:

The Assessment and Tax Policy Task Force, having regard for the fact that no quorum was present at the specified time and in view of the fact that notice had been placed in the newspaper that a public hearing would be held April 6, 1998, on the Property Assessment and Tax Policy System recently implemented by the Provincial Government, heard presentations from the public on this matter.

For the information of the Strategic Policies and Priorities Committee, the members of the Task Force who were present on April 6, 1998, also requested the Chief Financial Officer and Treasurer:

(1) to report directly to Council for its meeting on April 16, 1998, if possible:

(i) on the tax-dollar impact of applying the uniform tax rate for education established by the Province on the preliminary tax rate, including coloured maps, ward by ward for the residential and multi-residential categories of property, based upon assessment portions;

(ii) on the fairness or unfairness of the uniform tax rate for education;

(iii) with new maps, ward by ward, for the residential and multi-residential categories based upon the tax dollar changes, up or down, on assessment portions;

(iv) on a proposal for changes to provincial legislation and regulations to help the City of Toronto deal with the CVA program;

(v) with a summary of the relevant provincial regulations not yet published in any form and those regulations published only in draft form;

(vi) on changes to the overall assessment values by category (residential, multi-residential, commercial, industrial and linear properties) from the 1988 MVA (modified as necessary), the 1997 assessment base, and the 1998 CVA;

(vii) with a revised work plan for setting 1998 tax policies and tax rates in light of the announcement of the Ontario Minister of Finance delaying the process for one month;

(viii) on the cash flow problems caused to the City by the provincial delays in returning the 1998 Tax Roll, including an estimate of the province-wide costs to all municipalities;

(ix) on the evident "softness" of the 1998 Assessment Notices distributed by the Provincial Government and the potential impact on the 1998 tax rates; and

(2) to report directly to Council for its meeting on April 16, 1998, if possible and to the Budget Committee for its meeting on April 20, 1998, on the impact (if any) on the 1998 Operating Budget of the Council's policy choices regarding tax relief for seniors, physically handicapped persons, and businesses in special cases as announced by the Ontario Minister of Finance.

The members of the Task Force who where present also referred the following motions to the Chief Financial Officer and Treasurer for report back to the Task Force:

Motion by Councillor Augimeri

"WHEREAS bank vaults are difficult to remove once they are installed, and increase the value of a property; and

WHEREAS bank vaults in Toronto were, until this year, considered by the Provincial Assessment Office as adding to the value of a commercial property under the assessment rules; and

WHEREAS, for purposes of the 1998 assessment, the Province has decided that bank vaults will no longer be assessed, but rather be considered moveable assets; and

WHEREAS many property owners both residential and commercial will be seeing tax increases this year, and this decision will help to offset the increases to the banks;

THEREFORE BE IT RESOLVED that Chief Financial Officer and Treasurer:

(i) research the new assessment guidelines as they relate to this issue and inform the Assessment and Tax Policy Task Force on the impact of this change;

(ii) research any other significant changes and their potential impacts on the tax base of the City; and

BE IT FURTHER RESOLVED that the City of Toronto request that the Province of Ontario return to the old system of assessment for bank vaults and the vaults of other financial institutions."

Motion by Councillor Kinahan

"(1) That the proposals from the Board of Trade set out in the communication (April 6, 1998) presented by Mr. John Bech-Hansen, be referred to the Chief Financial Officer and Treasurer for report back in due course.

(2) That the Chief Financial Officer and Treasurer report on whether the industrial tax effective rate should be equalized with the commercial tax rate and the time frame for phasing in such."

Motion by Councillor Nunziata

"WHEREAS the business occupancy tax has been removed and an equivalent amount (averaged to 42 percent) added to the property tax; and

WHEREAS in multiple use properties (i.e. malls, office buildings and strip plazas) the tax has been assigned exclusively to the building and land without regard to the individual component business; and

WHEREAS Assessment will no longer be calculated as the total of a number of individually assessed businesses and data for individual businesses will no longer be calculated; and

WHEREAS this data after re-assessment will no longer be available; and

WHEREAS this information is required for many city functions, including economic development and mailing labels for planning notification; and

WHEREAS the proposed cap of 2½ percent will be calculated on the total of the most recent complete data; and

WHEREAS the responsibility for apportioning the tax among the tenants now falls to the landlord; and

WHEREAS there are no specific rules that govern the amount of tax a landlord may assign a commercial tenant;

THEREFORE BE IT RESOLVED that:

(1) the City take whatever steps that may be necessary to preserve the most recent complete data that indicates assessments on individual businesses;

(2) Council request the Province to continue to collect assessment data on this basis and staff report on how the City can replace the loss of this data base and at what cost;

(3) Council request the Province to amend the legislation to specify how landlords of commercial, industrial and multi-residential buildings shall apportion property tax among commercial tenants or the Province continue to provide commercial tenants with direct information about their property tax; and

(4) Council request the Province to amend the legislation to prohibit landlords from adding service charges to tax bills."

The members of the Task Force who were present also referred a communication (April 3, 1998) from Councillor Johnston respecting CVA and other matters to the Chief Financial Officer and Treasurer for report back to the Task Force.

Background:

The members of the Task Force had before them the following communications respecting the property assessment and tax policy system recently implemented by the Provincial Government:

(a) (March 18, 1998) from Mr. Alan Sugarman

(b) (March 16, 1998) from Mr. Jim Campbell, formerly M.T.S.B. Implementation

Co-ordinator, P.E.A.R. Department

(c) (undated) from Mr. Sidney Chelsky, obo Better Business Bureau of Metropolitan Toronto

(d) (April 6, 1998) from Mr. David Hui, Toronto Fair Tax Chinatown Committee addressed to the Minister of Finance

(e) (April 6, 1998) from Mr. John Bech-Hansen, Economist, Toronto Board of Trade

(f) (April 6, 1998) from Mr. Sean Goetz-Gadon, obo Anne Golden, United Way of Greater Toronto

(g) (April 3, 1998) from Councillor Johnston

The following persons addressed the members of the Task Force:

- Mr. Gerald Weiss

- Mr. Sidney Chelsky, obo Better Business Bureau of Metropolitan Toronto

- Mr. Peter Clutterbuck, Community Social Planning Council of Toronto

- Mr. Mario Calla, Executive Director, COSTI

- Ms. Gail McCullough, East York Learning Experience

- Mr. Sean Goetz-Gadon, obo Ms. Anne Golden, United Way of Greater Toronto

- Pat McKendry, Kensington Market Working Group

- Mr. Howard Tessler, Executive Director, Federation of Metro Tenants' Associations

- Mr. John Bech-Hansen, Economist, Toronto Board of Trade

- Ms. Reva Landau

- Mr. Joe Perna

- Mr. Larry Chilton, President, Toronto Rooming House Association

- Mr. David Joy, Annex Property Group

- Mr. Douglas Adamson, obo Ward One Residents for Local Democracy

- Ms. Marilyn Whiddon

- Mr. Jim Stephens

(Copies of the communications referred to in the transmittal letter dated April 6, 1998, from the Assessment and Tax Policy Task Force have been forwarded to all Members of Council with the agenda of the Strategic Policies and Priorities Committee for its meeting on April 7, 1998, and copies thereof are also on file in the office of the City Clerk.)