The fairest tax of them all

News Sep 25, 2009 Ancaster News

Coming to the political theatre this fall; a battle of epic proportions; blood will spill; tempers will flare; hostilities will be renewed; a victor will emerge.

The most certain result is a large proportion of taxpayers in Hamilton won’t be happy.

That’s right folks -the debate over area-rating is back, and promises to be the drama of the season.

From its inception at the dawn of amalgamation, area-rating has been a controversial solution for dealing with a city of residents who receive varying levels of services, deal with a vastly different realm of issues and, in some cases, lead vastly different lifestyles.

Now, after pushing back the debate last year, council is set to tackle the area-rating issue –once and for all. And already the line has been drawn in the sand between urban and suburban councillors.

Some Hamilton councillors (mainly in the old city wards) see themselves as modern day Robin Hoods, out to rob the rich suburbs to fund the poor inner city.

Hamilton is the only municipality in Ontario to use area-rating. It was created through a sense of guilt by politicians over the unpopular forced merger of six municipalities into one megacity back in 1999. Currently, we have a six-tier tax system.

In a (very simplified) nutshell, area-rating is the complex formula that allows wards of the city to be exempt from paying their tax portion on a select few services, if their residents do not directly access that service. Over the past eight years, the number of services eligible for area-rating has been whittled down to include just transportation (HSR), recreation and culture and fire services.

The sacrosanct program has been a financial lifeline for suburban residents. Amalgamation has resulted in higher property taxes for suburban areas, and inconsistent city services. Area-rating has also helped temper lingering anger over forced amalgamation.

Not surprisingly, councillors in rural wards are happy with the status quo. Not only do their constituents not receive enhanced services, they do not want them, they argue.

Just as natural is the response from urban councillors such as Sam Merulla, who insists that even though a ward doesn’t receive a direct benefit from a service, the collective population of the municipality is supported by having enhanced services in place, ergo they should pay for it.

The problem with the current area-rating system is that, even within one ward, not all taxpayers are receiving an even remotely equal level of services –nor should they. Consider Stoney Creek, with a huge rural swath above the escarpment, and large suburban areas all within the same ward. Same for Ancaster. Councillor Lloyd Ferguson must understand and weigh both rural and urban considerations in his decision making process.

There are three options for councillors to consider - continue the status quo, divide the services between rural and urban areas, or eliminate area rating.

The reality is without area rating, some residents within the vast borders of the city would pay exorbitant taxes for services they don't use.

So while the pending area-rating debate –pushed back this week from Sept. 24 to sometime in October –is no doubt past due, council must resist the urge to throw the baby out with the bathwater and abolish the system completely.

It’s time council looked seriously at implementing a fairer tax that would truly reflect the level of services taxpayers are getting. Whether this is determined by an urban/rural allocation, or whether it’s based on property zoning, it can –and should –be done.

The area-rating debate is now scheduled for October. Constituents should make their opinions known to their councillor now; once they get the tax bill, it will be too late.

The fairest tax of them all

News Sep 25, 2009 Ancaster News

Coming to the political theatre this fall; a battle of epic proportions; blood will spill; tempers will flare; hostilities will be renewed; a victor will emerge.

The most certain result is a large proportion of taxpayers in Hamilton won’t be happy.

That’s right folks -the debate over area-rating is back, and promises to be the drama of the season.

From its inception at the dawn of amalgamation, area-rating has been a controversial solution for dealing with a city of residents who receive varying levels of services, deal with a vastly different realm of issues and, in some cases, lead vastly different lifestyles.

Now, after pushing back the debate last year, council is set to tackle the area-rating issue –once and for all. And already the line has been drawn in the sand between urban and suburban councillors.

Some Hamilton councillors (mainly in the old city wards) see themselves as modern day Robin Hoods, out to rob the rich suburbs to fund the poor inner city.

Hamilton is the only municipality in Ontario to use area-rating. It was created through a sense of guilt by politicians over the unpopular forced merger of six municipalities into one megacity back in 1999. Currently, we have a six-tier tax system.

In a (very simplified) nutshell, area-rating is the complex formula that allows wards of the city to be exempt from paying their tax portion on a select few services, if their residents do not directly access that service. Over the past eight years, the number of services eligible for area-rating has been whittled down to include just transportation (HSR), recreation and culture and fire services.

The sacrosanct program has been a financial lifeline for suburban residents. Amalgamation has resulted in higher property taxes for suburban areas, and inconsistent city services. Area-rating has also helped temper lingering anger over forced amalgamation.

Not surprisingly, councillors in rural wards are happy with the status quo. Not only do their constituents not receive enhanced services, they do not want them, they argue.

Just as natural is the response from urban councillors such as Sam Merulla, who insists that even though a ward doesn’t receive a direct benefit from a service, the collective population of the municipality is supported by having enhanced services in place, ergo they should pay for it.

The problem with the current area-rating system is that, even within one ward, not all taxpayers are receiving an even remotely equal level of services –nor should they. Consider Stoney Creek, with a huge rural swath above the escarpment, and large suburban areas all within the same ward. Same for Ancaster. Councillor Lloyd Ferguson must understand and weigh both rural and urban considerations in his decision making process.

There are three options for councillors to consider - continue the status quo, divide the services between rural and urban areas, or eliminate area rating.

The reality is without area rating, some residents within the vast borders of the city would pay exorbitant taxes for services they don't use.

So while the pending area-rating debate –pushed back this week from Sept. 24 to sometime in October –is no doubt past due, council must resist the urge to throw the baby out with the bathwater and abolish the system completely.

It’s time council looked seriously at implementing a fairer tax that would truly reflect the level of services taxpayers are getting. Whether this is determined by an urban/rural allocation, or whether it’s based on property zoning, it can –and should –be done.

The area-rating debate is now scheduled for October. Constituents should make their opinions known to their councillor now; once they get the tax bill, it will be too late.

The fairest tax of them all

News Sep 25, 2009 Ancaster News

Coming to the political theatre this fall; a battle of epic proportions; blood will spill; tempers will flare; hostilities will be renewed; a victor will emerge.

The most certain result is a large proportion of taxpayers in Hamilton won’t be happy.

That’s right folks -the debate over area-rating is back, and promises to be the drama of the season.

From its inception at the dawn of amalgamation, area-rating has been a controversial solution for dealing with a city of residents who receive varying levels of services, deal with a vastly different realm of issues and, in some cases, lead vastly different lifestyles.

Now, after pushing back the debate last year, council is set to tackle the area-rating issue –once and for all. And already the line has been drawn in the sand between urban and suburban councillors.

Some Hamilton councillors (mainly in the old city wards) see themselves as modern day Robin Hoods, out to rob the rich suburbs to fund the poor inner city.

Hamilton is the only municipality in Ontario to use area-rating. It was created through a sense of guilt by politicians over the unpopular forced merger of six municipalities into one megacity back in 1999. Currently, we have a six-tier tax system.

In a (very simplified) nutshell, area-rating is the complex formula that allows wards of the city to be exempt from paying their tax portion on a select few services, if their residents do not directly access that service. Over the past eight years, the number of services eligible for area-rating has been whittled down to include just transportation (HSR), recreation and culture and fire services.

The sacrosanct program has been a financial lifeline for suburban residents. Amalgamation has resulted in higher property taxes for suburban areas, and inconsistent city services. Area-rating has also helped temper lingering anger over forced amalgamation.

Not surprisingly, councillors in rural wards are happy with the status quo. Not only do their constituents not receive enhanced services, they do not want them, they argue.

Just as natural is the response from urban councillors such as Sam Merulla, who insists that even though a ward doesn’t receive a direct benefit from a service, the collective population of the municipality is supported by having enhanced services in place, ergo they should pay for it.

The problem with the current area-rating system is that, even within one ward, not all taxpayers are receiving an even remotely equal level of services –nor should they. Consider Stoney Creek, with a huge rural swath above the escarpment, and large suburban areas all within the same ward. Same for Ancaster. Councillor Lloyd Ferguson must understand and weigh both rural and urban considerations in his decision making process.

There are three options for councillors to consider - continue the status quo, divide the services between rural and urban areas, or eliminate area rating.

The reality is without area rating, some residents within the vast borders of the city would pay exorbitant taxes for services they don't use.

So while the pending area-rating debate –pushed back this week from Sept. 24 to sometime in October –is no doubt past due, council must resist the urge to throw the baby out with the bathwater and abolish the system completely.

It’s time council looked seriously at implementing a fairer tax that would truly reflect the level of services taxpayers are getting. Whether this is determined by an urban/rural allocation, or whether it’s based on property zoning, it can –and should –be done.

The area-rating debate is now scheduled for October. Constituents should make their opinions known to their councillor now; once they get the tax bill, it will be too late.