In response to a call for feedback on the City’s consideration of changes to the program, the Peterborough Chamber of Commerce Board of
Directors provided staff with a similar recommendation.
What is/was the Vacancy Rebate Program?
The City of Peterborough sets aside $300,000 each year under the current Vacancy Rebate Program. The program, which has been in place since 1998 and is mandated by the provincial government, provides tax relief through a rebate of property taxes to owners of vacant commercial and industrial buildings. Currently, the rebates sit at 30% for commercial buildings and 35% for industrial, should the property meet certain requirements, including length of vacancy.
Why was the City looking to change the program?
Recently, the province allowed municipalities to start discussions and make changes to the program.
Several options were on the table:
1. Eliminate the rebate program in its entirety, beginning in 2018 for the 2017 tax year.
2. Phase out the program over a 3 year period:
- Applications received in 2018 for the 2017 tax year to be processed as normal.
- Applications received in 2019 for the 2018 tax year would be eligible for a rebate of 20% if commercial and 23.5% if industrial.
- Applications received in 2020 for the 2019 tax year would be eligible for a rebate of 10% if commercial and 12% if industrial.
- No rebate would be offered beginning in 2021.
4. Revise the current program.
- Potential changes that may be considered include reducing the rebate percentage, increasing the minimum period of vacancy and limiting the property types eligible for the program.
What was the Peterborough Chamber's response to the call for feedback?
After reaching out to our membership of more than 900 businesses, discussions at the Policy Committee and Board of Directors level, the business community believed there were other options than those above to encourage continued business investment in Peterborough and revitalization of current building stock. As the Vacancy Rebate Program applied to ratepayers in commercial and industrial tax class across Peterborough, it was felt the
redeployment of any funds should be city-wide as well.
Our members also wanted City staff to know that use of the program could be very helpful in certain cases and not a reason for building owners to keep space vacant.
What was the recommendation from the Peterborough Chamber of Commerce?
The Tax Ratio Reduction Program, which resulted from a coordinated lobbying effort by the Peterborough Chamber of Commerce, Kawartha Manufacturer’s Association and Peterborough & the Kawarthas Association of Realtors, is currently set to meet its target of 1.5 times the residential tax rate by 2021. Our understanding was that applying the Vacancy Rebate Fund to accelerate the program will allow the commercial rate to realize that ratio a year ahead of schedule in 2020.
An added bonus to redeploying the money in this way is that it will provide city-wide relief to businesses of all sizes and sectors and in turn create an even more business-friendly environment for economic growth in Peterborough.
What is the final approved Council Resolution?
- That the Vacancy Rebate Program be eliminated for the 2017 taxation year, commencing with the 2018 budget.
- That the $300,000 budget for the Vacancy Rebate Program be redeployed to the Tax Ratio Reduction Program by accelerating the reduction of ratios for the Commercial tax class.
- That staff provide a report on a possible program to assist in the redevelopment of existing buildings.