1999 Levy on Railway Roadways or

Rights of Ways and on Power Utility

Transmission or Distribution Corridors

The Policy and Finance Committee recommends the adoption of the report (October 7, 1999) from the Chief Financial Officer and Treasurer.

The Policy and Finance Committee reports, for the information of Council, having requested the Chief Financial Officer and Treasurer to submit a further report thereon to the Policy and Finance Committee.

The Policy and Finance Committee submits the following report (October 7, 1999) from the Chief Financial Officer and Treasurer:

Purpose:

To obtain Council's authority for the adoption of a by-law for the levying and collection of taxes on railway roadways or rights of ways and on power utility transmission or distribution corridors, as required by the Municipal Act and the Education Act.

Financial Implications:

Revenue of approximately $17 million will be raised and is included in the 1999 estimated property tax revenues.

Recommendations:

It is recommended that:

(1)Council authorize the levy and collection of taxes for the 1999 taxation year on roadways or rights of ways of railways and on transmission or distribution corridors owned by power utilities, in accordance with subsection 368.3(1) of the Municipal Act and subsection 257.7(1) of the Education Act; and

(2)Authority be granted for the introduction of the necessary bill in Council to levy taxes for the year 1999 on such roadways, rights of ways and transmission or distribution corridors, in the form or substantially in the form of the draft by-law attached hereto.

Comments:

Subsection 368.3(1) of the Municipal Act requires municipalities, in accordance with the regulations, to levy an annual tax for municipal purposes on railway roadways or rights of ways and on transmission or distribution corridors owned by certain power utilities. Ontario Regulation No. 387/98, as amended, prescribes the municipal rates which municipalities are required to levy. Such rates are prescribed as rates per acre of land.

Subsection 257.7(1) of the Education Act requires municipalities to levy and collect taxes based on the rates prescribed for school purposes on the railway and power utility lands described in subsection 368.3(1) of the Municipal Act. Ontario Regulation No. 392/98, as amended, prescribes the tax rate for school purposes which municipalities are required to levy. The rate is also prescribed per acre of land.

The attached draft by-law levies taxes on railway roadways or rights of ways and on power utility transmission or distribution corridors in Toronto for 1999, in accordance with the City's obligations under the Municipal Act and the Education Act.

Ontario Hydro made payments-in-lieu of taxes for its transmission and distribution corridors, pursuant to the Power Corporations Act. As such, no by-law is required for payment by Ontario Hydro. However, as the Power Corporations Act was repealed on April 1, 1999, Ontario Hydro is only required to make payments-in-lieu of taxes for the period of January 1, 1999, to March 31, 1999.

The Generation Corporation and the Services Corporation are two of the new corporations created by the Electricity Act, 1998 to replace Ontario Hydro. These corporations came into existence on April 1, 1999. The Generation Corporation and the Services Corporation, and their subsidiaries, are prescribed by the Minister as power utilities to which section 368.3(1) of the Municipal Act applies. The City is therefore required to levy taxes on their transmission and distribution corridors, in accordance with that section and the prescribed rates.

The rates set out in Table 1, below, are the rates to be levied for 1999 by the City on railway roadways and rights of ways and on power utility transmission and distribution corridors:

Table 1

The late filing of the regulation for 1999 by the Province has delayed the billing of these properties. To ensure sufficient time for both the billing and mailing of the bills as well as providing sufficient time for payment by the taxpayer, a single instalment date of December 15, 1999 is recommended.

Contact Name:

Paul Wealleans, 397-4208

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Authority:Community Council/Committee Report No., Clause No. as adopted by City of Toronto Council on [Note: If the authority refers to a past Council, please insert all three dates; if it refers to a current Council meeting, just insert the first day of the Council meeting]

Enacted by Council:

CITY OF TORONTO

Bill No.

BY-LAW No. [By-law number]

To Levy and Collect Taxes for 1999 on Certain Railway Company

and Power Utility Lands

WHEREAS paragraph 1 of subsection 368.3(1) of the Municipal Act provides that every local municipality shall impose taxes, in accordance with the regulations on the roadway or right of way of a railway company, other than the structures, substructure and superstructures, rails, ties, polies and other property on the roadway or right of way, not including land leased by the railway company to another person for rent or other valuable consideration; and

WHEREAS paragraph 2 of subsection 368.3(1) of the Municipal Act provides that every local municipality shall impose taxes, in accordance with the regulations on land owned by a power utility prescribed by the Minister of Finance (other than a public utility defined in subsection 27(1) of the Assessment Act) and used as a transmission or distribution corridor, not including land leased by the power utility to another person for rent or other valuable consideration; and

WHEREAS Ontario Regulation No. 387/98, as amended, prescribes the 1999 tax rates for municipal purposes for such railway and power utility properties, and the tax rates levied for municipal purposes by sections 1 and 2 hereof are in accordance with the tax rates so prescribed; and

WHEREAS paragraph 1 of subsection 257.7(1) of the Education Act provides that every municipality shall in each year levy and collect the tax rates prescribed for school purposes on the business property in the municipality; and

WHEREAS section 257.5 of the Education Act defines "business property" to include the railway and power utility properties described in paragraphs 1 and 2 of subsection 368.3(1) of the Municipal Act.

WHEREAS Ontario Regulation No. 392/98, as amended, prescribes the 1999 tax rates for school purposes for such railway and power utility properties, and the tax rates levied for school purposes by sections 1 and 2 hereof are in accordance with the tax rates so prescribed; and

WHEREAS Ontario Regulation No. 387/98 and Ontario Regulation No. 392/98, as amended, prescribe the Generation Corporation, as defined in the Electricity Act, 1998, or a subsidiary thereof within the meaning of that Act, and the Services Corporation, as defined in the Electricity Act, 1998, or a subsidiary thereof within the meaning of that Act, as prescribed power utilities for the purposes of paragraph 2 of subsection 368.3(1) of the Municipal Act.

The Council of the City of Toronto HEREBY ENACTS as follows:

1.(1)There shall be levied and collected as taxes for 1999 in the City of Toronto on the roadways or rights of way owned, or leased from a municipality, on December 31, 1997 by a railway company set out in Column I or the assessed owners corresponding to that railway company as set out in Table 7 of O. Reg. 387/98 and 392/98, as amended, other than the structures, substructures and superstructures, rails, ties, poles and other property on the roadway or right of way, but not including land leased by the railway company to another person for rent or other valuable consideration, the rate per acre for municipal purposes set out in Column II and the rate per acre for school purposes set out in Column III:

Column IColumn IIColumn III

(railway company)(rate per acre for (rate per acre for

municipal purposes)school purposes)

Canadian National Railway 1,973.51 2,488.79

Canadian Pacific Railway 1,911.69 2,381.71

Toronto Terminal Railway 11,275.7116,667.63

Company Limited

(2)There shall be levied and collected as taxes for 1999 in the City of Toronto on all other roadways or rights of way of a railway company, other than the structures, substructures and superstructures, rails, ties, poles and other property on the roadway or right of way, but not including land leased by the railway company to another person for rent or other valuable consideration, the rate of 611.33 per acre for municipal purposes and the rate of 822.69 per acre for school purposes.

2.There shall be levied and collected as taxes for 1999 in the City of Toronto on all land owned by a prescribed power utility and used as a transmission or distribution corridor, not including land leased by the power utility to another person for rent or other valuable consideration, the rate of 834.02 per acre for municipal purposes, and the rate of 1,208.66 per acre for school purposes.

3.All taxes levied by sections 1 and 2 hereof, shall be due and payable on or before December 15, 1999.

4.Sections 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 19, 20, and 21 respectively of By-law No. 231-1999, as amended, apply to the taxes levied by sections 1 and 2 hereof.

ENACTED AND PASSED this day of, A.D..

   MayorCity Clerk