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Red Lake council approves $20M budget, 3.5 per cent net tax increase

BY LINDSAY BRISCOE

The 2015 Red Lake municipal budget, which council approved at a special meeting on April 28, spells out total expenditures of $20,030,930 and a net tax increase of 3.5 per cent to the local ratepayer.

Mayor Phil Vinet is quick to point out, however, that there’s more to that increase than meets the eye.

The tax rate set by the municipality has actually dropped over the last year. In 2014, it was .01423587, while in 2015 it’s .01386124. The net tax rate of 3.5 per cent is determined by multiplying the MPAC (Municipal Property Assessment Corporation) assessments by the tax rate.

“We control one factor: the tax rate. We have no control over MPAC,” Vinet explains further. “Under ideal circumstances, the local population would determine how the property should be assessed based on current market value; it’s not rocket science. But MPAC is the provincial organization that oversees 444 municipalities and the unincorporated areas and they determine what the assessments are.”

Vinet and municipal CAO Mark Vermette further broke it down in an interview: Under the 2015 budget, if MPAC assesses a home at $50,000, the residential tax increase on a monthly basis for that household works out to $1.46; at $100,000, the monthly increase is $2.92; and at $200,000, the monthly increase is $5.84.

The chart breaks down MPAC residential assessment values within the Municipality of Red Lake. Seventy-seven per cent of homes are assessed at less than $200,000, yet many homes sell for more than $200,000. Chart courtesy of the Municipality of Red Lake.
The chart breaks down MPAC residential assessment values within the Municipality of Red Lake. Seventy-seven per cent of homes are assessed at less than $200,000, yet many homes sell for more than $200,000. Chart courtesy of the Municipality of Red Lake.

What’s the solution?

More sticks and bricks, says Vermette. That is, more homes in going up in the area.

“You’ll hear us preach that we need that organic growth. In other words, we need more people paying the same,” he adds.

The municipality is currently exploring several options for housing development in the area.

MPAC assessment appeals

One of the major challenges the municipality faces is the obligation to issue refunds for successful appeals of MPAC assessments, whether they be residential, commercial, or industrial assessment appeals.

For 2014, the municipality had to issue refunds to the tune of $311,000; $278,000 of which was related to class changes (commercial to residential or industrial to commercial) and successful appeals on valuation (the most common being industrial/large industrial).

The remaining $31,927 was to cover vacancy rates for commercial and industrial properties, which are entitled to a 30 per cent vacancy rebate if they are vacant during the taxation year.

During the budget process, the municipality tries to estimate and provide for assessments at risk or successful assessment appeals, says municipal Treasurer Brian McQuarrie.

Capital expenditures of note

Public Works: $636,995 in 2015 (up from $296,500 in 2014). The Public Works department will purchase a new multi-purpose vehicle; upgrade the Public Works Building; purchase a GPS system which will help establish an electronic database that maps the municipality such as locates, streets, water and sewer, streetlights, etc. (this information is crucial for provincial and federal funding applications); purchase a hydrovac trailer which will enable the municipality to flush out lines without having to hire a contractor (this used to be a $50,000 budget item); and pave a street in Red Lake which is yet to be determined.

Parks: $11,000 in 2015 (up from $0 in 2014). Norseman Park will receive a facelift this year including possible permanent anchors for festival tents.

Water Treatment Plant: $402,000 in 2015 (up from $129,550 in 2014). The money will be spent on necessary upgrades to the water tower in Red Lake.

Outdoor rinks: $22,000 in 2015 (up from $0 in 2014). The municipality will perform electrical upgrades to the storage shed next the outdoor rink in Red Lake as well as build another storage shed for the Zamboni and maintenance crew equipment.

Pharmacy: $57,775 in 2015 (up from $0 in 2014). The municipality will convert the former medical clinic—which is to house the pharmacy—to natural gas. The walkways will also be improved.

Recreation: $81,257 in 2015 (up from $0 in 2014). The municipality has hired an engineering firm to conduct a Trails Engineering Study.

Sanitary and sewer: $194,100 in 2015 (up from $68,113 in 2014). This money will cover namely the natural gas conversion of two buildings.

Firehall: $82,738 in 2015 (up from $55,827). The Balmertown Volunteer Fire Department building will also undergo a conversion to natural gas.

The 2015 Red Lake municipal budget can be viewed in full at www.redlake.ca.

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