Campbell River council revokes non-profit groups’ tax exempt status

Council is expected to adopt the bylaw sometime within the next month

A handful of local charities and non-profit groups are about to take a big financial hit.

City tax exemptions for six non-profits are on the verge of being revoked in order to adhere to rules laid out in the provincial Community Charter.

“This has been in the Community Charter for awhile,” said Natalie Aalderink, the city’s finance manager, at a council meeting Sept. 18. “We went and got the interpretation of it (and) we got clarification from the province.”

What that means is property tax exemptions can only be granted if a charitable, philanthropic, or other not-for-profit owns the land it operates on.

Six local groups, which have in the past been given the tax exemption, do not fit the above criteria.

As a consequence, council gave first three readings last week to an amendment to the permissive tax exemption bylaw that will deny tax breaks to Habitat for Humanity’s ReStore, Total Change Ministries’ 88.7 Spirit FM Christian Music radio, Campbell River Family Services, Canadian Red Cross, Campbell River Seniors Society, and River City Players. Council also denied issuing new tax exemptions to the Campbell River Dragon Boat Society, Opportunities Career Services Society, and the Strathcona Regional District.

Aalderink explained that because those organizations don’t own their own buildings, the tax break truly goes to the property owner.

Coun. Ryan Mennie argued that the non-profit does benefit.

“Would it also not be fair to say that without the exemption…the owner has to recover those costs?” Mennie asked. “I’m assuming the owner would raise the rent to try and recover the costs of the tax exemption they’re not getting.”

Coun. Claire Moglove was concerned the city was pulling the rug out from under the societies involved, which had not been notified prior to the council meeting.

“It’s going to be a significant hit to those particular groups,” Moglove said. “Is there…a grant-in-aid or something like that, where these groups would be able to apply for a grant similar in amount, so that they won’t be so negatively impacted?”

Aalderink replied that the groups could indeed apply for grants with the city, in place of tax exemptions.

Coun. Andy Adams acknowledged the difficulty in turning down tax exemption requests.

“A very difficult report to bring forward,” Adams said. “It’s never pleasant to bring forward a report denying a permissive tax exemption, particularly when they’ve had it up until this point.”

Meanwhile, one new tax exemption was recommended by the city’s finance committee for Willow Point Supportive Living Society, a non-profit providing affordable housing for independent seniors. The society is requesting a tax break on property purchased in December 2009.

The list of tax exemptions is not yet final. Council is expected to adopt the bylaw sometime within the next month.