A group of concerned citizens urged civic officials on Wednesday to proceed with caution when considering tax breaks for heavy industry that could impact residents’ pocketbooks and the city’s overall cost of living.
“You don’t want to be focussed on one tax group at the expense of other tax groups,” Kamloops Voters Society director Randy Sunderman told KTW.
The city’s finance committee has been tasked by council with reviewing a policy that pushes down over time the heavy industry property tax rate, due to high taxes paid in Kamloops compared to other cities in the province.
The Kamloops Voters Society presented somewhat unexpectedly during the delegation portion of Wednesday’s meeting, appearing on a day when Domtar — the city’s largest single taxpayer — was scheduled to present to the committee tasked with reviewing the policy.
Sunderman called for a “holistic” review and stressed the importance of methodology. When comparing the city’s heavy industry tax rates with other communities, Sunderman said, it is more important to look at communities with similar heavy industry makeup, not just like-sized communities.
According to Sunderman, Vernon was used in the city’s previous comparison but it “doesn’t have any heavy industry left.”
The group said any property tax tweak may have a trickle effect that could impact costs of living, attraction of professionals and employees, business growth and more.
“What we want is the city to use good comparisons and sound methodology to do a review of comparable heavy industry tax rates, when they’re looking at other communities,” Sunderman said.
“It’s about the methodology.”
Meanwhile, Domtar general manager Jean-Claude Allaire advocated for “fair” heavy industry taxation.
He said the Kamloops mill has the highest property tax rate among its B.C. competition.
Furthermore, the council policy capping heavy industry tax rates provides stability, he said, allowing him to seek further investment in the Kamloops facility. The cap allows Domtar to make investments in its property without taxes increasing, despite its overall assessment increasing.
Investments in the property provide long-term stability for the mill, Allaire said, which employs 340 people. He pointed to sawmill closures around the province and called property taxes in Kamloops a “huge constraint” in obtaining investment.
Allaire cited two significant capital investments in recent years and more expected in the future.
“What we’re asking is to pay our fair amount of tax,” he told KTW.
“We want to work with the city in order to bring it down to an average. We’re so far ahead. When we’re talking with Kamloops Voters Society, we can agree or disagree, respectfully, about the argument. The thing is, we’re so far ahead. We just want to reduce that gap.”
Domtar is increasingly focussed on the pulp aspect of its business, as demand for paper declines. Challenges, Allaire told KTW, include pricey fibre — resulting from a fibre shortage and expensive logs — as the price of selling pulp declines.
Asked what he would tell a Kamloops resident whose taxes rose on average about $4 in 2019 as Domtar’s rate decreased, Allaire said the two interests do not conflict and noted Venture Kamloops estimates the mill provides 1,300 direct and indirect jobs.
Allaire also pointed out during the meeting myriad community groups and events the company supports including the Kamloops Hospice Association, the Kamloops Blazers, Kamloops Ribfest, Eureka Science Camps, Raise-A-Reader, the Kamloops Food Bank, the United Way Thompson Nicola Cariboo, Thompson Rivers University, PIT Stop and more.
“When you’re talking about us,” he told the committee, pointing to the screen. “This is us.”
In the end, the committee tasked staff with coming back to the committee next month with heavy industry tax rates in a variety of other communities.
Also up for review is whether public delegations should be heard at the committee level or council as a whole.
Coun. Mike O’Reilly said that while he found the Kamloops Voters Society presentation helpful, the scenario created a miniature council meeting, with information possibly better heard by all of council, which makes the final decision.
Review of the new committee structure is expected in the near future.
“To me, it doesn’t really matter whether there’s a delegation or not, it’s just knowing what the process is and how to get a delegation there or not and we can all play by the same rules,” O’Reilly said.