Rail lands levy would have time limit

A levy to pay for the rail lands purchase would stay on tax bills for about 10 years, but be reduced after about seven, North Bay deputy mayor Peter Chirico says.

The levy was discussed again near the end of Thursday night’s budget meeting.

Chirico and Mayor Vic Fedeli first talked it about at last Thursday night’s budget meeting as a way to repay almost $11 million borrowed by the city to buy the rail lands.

Another suggestion to bring in revenue—a buck a bag on garbage collection—met with a poor response from the public, prompting talk of the levy.

Levy goes away
Both Chirico and Fedeli said tax bills would be reduced by whatever amount was decided upon for the levy.

“And we’ll clearly identify a start and a finish date regarding that debt of some $12.4 million, and that is the big key to it,” Chirico said.

The budget chief thinks the rail lands “will be a great project” down the road.

“But taxpayers are asking where their tax dollars are going to and I think this is one way to clearly define a start and a finish date to this debt which has been incurred,” Chirico said, “and in 10 years from now, when the debt is paid off, the levy goes away.”

Chief financial officer Brian Rogers said the levy would be reduced by aobut one-third after year seven.

Stay the course
The city paid $1.4 million cash for the rail lands and issued debentures for $3.4 million in 2001, $3.7 million in 2002, and $3.7 million in 2003.

Principal and interest owed on the rail lands in 2004 amounts to $1.4 million.

During the first part of the meeting, which dealt with assessment and taxes, Rogers recommended council not change its current tax policy.

Chirico said there’s been a “substantial” growth in residential assessment over the past year.

“That’s one of the primary ones, roughly about five per cent assessment growth on there, and there’s been not too much change in the commercial, industrial and multi-residential tax classes,” Chirico said.

“So we’re recommending that we stay the course on our tax policy because of the basic flat line in those other assessment classes.”

Abosorbed by other properties
Rogers also recommended the city make no changes with regard to capping tax increases within multi-residential, commercial and industrial classes.

Under the provincially mandated rules of the capping program, the city would be required to limit to five per cent any tax increases resulting from assessment increases.

“If their assessment is up by more than five percent we have to reduce their taxes and there’s a cost involved with that,” Rogers said.

“But council has chosen the option of paying for the costs of providing those caps within the class, to make sure no cost is involved to the rest of the tax payers and that it’s absorbed by other properties within the class.”