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TransLink's one-size-fits-all tax rate hits hot markets harder
TransLink's property taxes are taking a deeper bite from Metro Vancouver home owners in parts of the region where real estate prices are being rapidly bid up by an influx of foreign buyers.
TransLink's board last week approved property tax rates that will see the average home pay the transportation authority an extra $4.16 this year, or a total of $228.21.
That's based on the average 2011 residential property assessment of $652,000 – which climbed 10.7 per cent from a year ago.
But property values are rising at different rates in different cities around the region and homes in supercharged markets will pay considerably more.
TransLink spokesman Ken Hardie said the authority tries to strike a balance but must apply the same residential tax rate consistently across the region – this year it's $0.35 per $1,000 assessed value.
Richmond has seen median house prices spike to more than $1 million in recent months amid a surge of interest from mainland Chinese buyers.
That activity isn't yet fully reflected in the assessed value, which this year rose 17 per cent on average in Richmond based on assessments as of last July.
But a house in the city's Broadmoor area that climbed 21 per cent in assessment from $1 million to $1.21 million will pay nearly $425 to TransLink this year, up from about $380 a year ago.
"It's going to affect homeowners in Richmond, so that's a concern," Richmond Mayor Malcolm Brodie said.
The dynamic is similar in Tsawwassen, where many assessments rose at least 17 per cent, as well as Vancouver, where a typical west side house on a 50-foot residential lot jumped 27 per cent from $1.84 million to $2.33 million.
"We've been concerned for some time about the continued and increasing use of property taxes by TransLink," Brodie said.
The appointed TransLink board, which meets behind closed doors, is empowered by the province to collect up to three per cent more each year in property taxes without seeking approval of the region's mayors council.
This year's increase raises the tax take from the average home by 1.86 per cent and from the average business by 1.95 per cent, with the additional revenue to the three per cent limit coming from new construction.
The board can ask for higher property taxes beyond inflation to fund expansion plans, but only with the mayors' approval.
Mayors last December rejected a board request for such an increase to pay TransLink's share of the Evergreen Line costs. It would have raised the average home's TransLink tax by at least $35 per year.
Talks have now resumed between the mayors and the province in a search for alternative funding sources, many of which may tap motorists rather than property owners.
The cities continue to take the position TransLink property tax can't go any higher.
"It is limited out providing the existing level of service and cannot be relied on going forward as the transportation system is expanded," said mayors council chair Richard Walton, mayor of North Vancouver District.
"Property tax is a wealth tax and not even a very good one as it is passed on to renters and doesn't differentiate between various equity levels people have in their homes."
TransLink will take in a total of $297 million in property taxes this year, its third-highest source after transit fares of $432 million and fuel taxes of $324 million.