THUNDER BAY -- Reduced services or higher taxes might be the city's only options as it continues to lose millions of dollars to property reassessments.
The city was told by the Municipal Property Assessment Corporation via letter late last month that the eight elevators in the city will now be classified as commercial rather than industrial and that assessment will be based on production. That's a $700,000 loss and will look to be around $900,000 by 2016.
City manager Tim Commisso said these decisions have cost the city around $5 million as industry in Thunder Bay continues to be reassessed, wiping out any optimism for the $2 million per year on average the city's been seeing in growth over the past few years.
"That's just getting eroded. The amount of new taxes that we're getting this year have been totally eliminated based on some of these decisions," he said.
"The bottom line is it reduces our taxes from the industrial tax base. We're in the business of providing services."
Those services, from emergency to infrastructure, are being supported more and more by residential taxpayers as industrial and commercial properties get the benefit of new assessments. Commisso said the city has been raising the issue with the province for more than a year.
"We were ignored, I'll say that outright. There was no consultation whatsoever," he said.
The city pays MPAC more than $1 million a year and yet only learns of its multi-million dollar decisions through letters. Why it has decided to base assessment on production has still never been answered despite the city's now $5 million loss.
"We pay a lot of money to MPAC to provide services and we expect, I think that when we raise these concerns and we do them in a legitimate and forthright way, we're going to get some response and we're not," he said.
Commisso is speaking to council Monday on the issue. He's proposing the city's intergovernmental affairs committee lobby the province to make legislative changes on tax rates.
City council will be presented with options on reduced services or higher taxes during budget deliberations.
