Penticton assesses COVID-19 economic damage, offers some taxpayer relief - InfoNews

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Penticton assesses COVID-19 economic damage, offers some taxpayer relief

April 23, 2020 - 4:23 PM

The City of Penticton sought to find ways to take some of the financial burden off the taxpayer due to the COVID-19 pandemic, at the same time staff informed council of the health crisis’ effect on revenues today.

Chief financial officer Jim Bauer told council “many City revenues are at risk,” due to the COVID-19 pandemic, noting the closure of the City's recreation and entertainment venues, business closures and residents out of work.

There is also a potential long-term impact on development and related fees, Bauer said at today's special meeting, April 23.

“It’s difficult to estimate definitively, but the City is losing around $200,000 per week in revenue. We’ll continue to lose even when restrictions begin to ease,” he told council.

Last year the City generated $117 million in revenues, with $35 million coming from taxes and roughly half coming from utilities.

With COVID-19 threatening household incomes, collectibility of taxes is at risk, as is a substantial portion of the $2 million in revenues the City received from gaming revenues.

He couldn’t put a price tag on potential losses from building and planning permits.

Among the unknowns the City faced were how many residents would be unable to pay taxes, how long the health crisis would last and what the recovery is going to look like, Bauer told council.

He said the City currently held a strong cash position with a build up in reserves. Revenues from city facilities like the South Okanagan Events Centre and the convention centre were at risk but the City was taking steps to control spending by reducing the workforce by 20 per cent, containing costs and limiting spending to essential services.

Bauer brought forward a number of options for council to ponder in consideration of property tax deferrals and utility payments in an effort to ease the financial burden on taxpayers as tax season approaches.

Council agreed to a 60 day deferral of property taxes, making the due date for taxes this year Sept. 30.

The move is expected to cost the city $100,000 in lost revenue.

Other options for council consideration included a 45-day deferral, a one-month deferral or maintaining the status quo.

Council also voted in favour of a dual-option approach in utility relief, hoping to see the province extend its initiative to BC Hydro to provide a three month billing credit to its customers.

Council opted to go with staff’s second option - to provide a 10 per cent discount to the City’s customers - but only if the province failed to answer the city’s request to extend the BC Hydro offer.

Councillor Campbell Watt called the utilities issue the topic most likely to be re-evaluated as the health crisis continues.

“People aren’t going to jump back into work that pays more so they can catch up,” he said, voicing his support for the 10 per cent discount, in lieu of the BC Hydro billing credit.

Director of Development Services Blake Laven offered other COVID-19 relief measures for council consideration, recommending council approve the following measures:

  • suspending enforcement of delinquent business licenses including short term rental businesses and waiving all penalties until October, 2020.
  • suspending the Good Neighbour Bylaw vacant building registration requirement for businesses affected by COVID-19, for the remainder of the year.
  • postponement of a planned July 1 development cost charge increase
  • waiving permit fees for homeowner based renovation projects up to $50,000 in value until October, 2020.

Council agreed unanimously to the recommendation after a discussion over the total value of homeowner based renovation projects, raising that amount from $50,000 to $100,000.


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