Ottawa ended 2016 with a $5.4-million surplus even as a growing number of tax-assessment appeals put a major dent in the city’s finances.
More and more commercial property tax payers are appealing their assessments, and this year that bill came home to roost for the city.
The city spent $26 million more than expected for property tax adjustments.
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City treasurer Marian Simulik said there is a four-year cycle to property tax assessments and this is the bottom end of it for the city.
“It’s always the most expensive in the fourth year, so we are starting a new cycle and it should be down in 2017,” she said.
She said when a company wins an appeal, the city has to return more than just the one year of extra payments.
“We have three years of taxes that we have to return,” she said.
Simulik said city isn’t losing appeals at a higher rate than before, but it’s seeing a lot more challenges.
“The way assessments work now is that almost every commercial enterprise, as a sort of a cautionary approach or defensive approach, files an appeal.”
The city also offers rebates when commercial tenants have empty space in their buildings, and many downtown buildings had trouble filing their space this year.
Not including water and wastewater services, which the city keeps separate because they’re not supported by taxes, the city actually ended the year $8.2 million in the red, with higher costs for snow removal and the tax assessments all adding up.
Simulik said in the context of the city’s nearly $3 billion annual budget the deficit is “pretty tiny.”
By the numbers:
City’s overall budget not including water and sewage – $2.86 billion
City’s deficit – $8.2 million
Extra costs in 2016 for heavy snowfalls – $9.8 million
Extra costs for commerical property tax adjustments – $26 million
This article originally appeared in Metro News.
