Average homeowners in North Cowichan could face hikes of up to $350 in property-tax this year if council shifts more levies to residences from heavy industries, Mayor Jon Lefebure said.
That hefty tax load could be even heavier if Catalyst’s struggling Crofton pulp-and-paper mill closes, the mayor explained.
“‘Braced’ is a good word,” he said of crystal-ball work by council and administrator Dave Devana.
“Council wants to be informed on what could happen.”
North Cowichan’s largest taxpayer paid council about $5.4 million last year — about 90 per cent of the municipality’s $6.3 million heavy-industry levy.
Previous councils have been slowly weaning the municipality of its dependence on one business. this council is wrestling over whether or not to accelerate the process.
Optics of what could be in store for homeowners and Catalyst were outlined by administrator Dave Devana during Monday’s finance committee meeting.
He painted a picture of helping Catalyst by lowering heavy-industry tax rates to those of light-industry taxpayers, Lefebure said.
“That would be about $350 tax burden on the average home,” the mayor said of the possible homeowner tax jolt.
“Devana recommends we do a major shift.”
Homeowners could also face additional tax hikes to cover the 2012 budget, including a municipal-hall expansion and more, Lefebure indicated.
Devana’s worst-case scenario could see homeowners pay about $100 per $1 million the mill now pays North Cowichan annually if the mill closes.
That would mean a rate rise of about $500 a year.
“Devana wasn’t speculating on the mill failing,” Lefebure stressed.
But tax watchdog Scott Baker was.
He accused council of mismanaging tax dollars, and failing to plan for the mill’s demise years ago by slowly boosting local levies while broadening the tax base with new businesses.
“If they’d increased taxes gently over the past 10 years we wouldn’t be in this situation,” he fumed after Monday’s committee meeting.
Baker predicted “people will be outraged” when they see council’s books in the planned meetings.
“Taxpayers should realize council doesn’t know what it’s doing, and the business community should help them readjust this,” Baker said.
Tax tactics will be tackled at Monday’s 6 p.m. public meeting in council chambers during a review of North Cowichan’s draft financial plan, operations and capital.
It’ll be the first of many public-input huddles planned to explain the municipality’s monetary realities in the face of fiscal restructuring by Crofton mill.
“Homeowners must follow what we’re doing as closely as they can,” Lefebure said.
That path will also lead to a Feb. 15 financial plan open house at the hall.
Council aims to work with Catalyst to reduce its tax burden, and preserve local jobs, Lefebure said.
“This was a regular discussion at tax time. What’s different now is Catalyst’s (financial) situation.
“We always knew (its future) wasn’t guaranteed. Their share value has gone to one cent.”