City’s managed forest land bylaw stands

Tax: Company claims rate is unfair

TimberWest has decided not to launch a final challenge of the City of Campbell River’s authority to raise the tax rate on managed forest lands within city boundaries.

The 60-day period for TimberWest to appeal a BC Court of Appeal ruling on the City of Campbell River’s 2014 Tax Rates Bylaw expired on March 29, meaning the BC Court of Appeal’s ruling is final.

On Jan. 29, 2016 the BC Court of Appeal issued its judgment on TimberWest Corporation’s appeal of the BC Supreme Court decision upholding the City’s 2014 Tax Rates Bylaw.

In its ruling, the BC Court of Appeal unanimously dismissed TimberWest’s argument that the city did not have the authority to raise the tax rate on managed forest lands within City boundaries.

“We are pleased to hear that the BC Court of Appeal has upheld the City’s 2014 Tax Rates bylaw,” says Mayor Andy Adams. “The decision to raise property taxes in 2014 on managed forest lands simply brings the tax rates on TimberWest’s properties in Campbell River to the provincial average over a three-year phase-in period. The City recognizes TimberWest as a valued taxpayer and are happy this court case is behind us.”

TimberWest, the city’s largest private timber and land management company, filed the tax challenge last Feb. 27, 2014 after council increased taxes on managed forest lands from $2.29 per thousand dollars of assessed value to the provincial average of $13.98.

The increase, to be phased in over three years, was set to bring rates in line with other B.C. municipalities.

TimberWest argued during a 2014 hearing in Vancouver that the new tax bylaw would increase its taxes in 2014 by more than two and a half times the rate for 2013 and that once additional increases are phased in over three years, TimberWest will be taxed at a rate that is more than five times what Merrill and Ring will pay.

The BC Court of Appeal found that the Supreme Court correctly interpreted the relevant legislation, and upheld the city’s position that the province, through section 14 of the Local Government Act and other taxing legislation, provides specific authority to local governments to set separate tax rates within the same property class where, as in this case, there has been a municipal boundary extension approved through legislation.

“The judgment made in this case is of interest to local governments throughout the province as there are examples of many other municipalities that have similarly set differential tax rates through a municipal boundary extension, which have now been upheld at both the Supreme Court and the Court of Appeal,” says Ron Bowles, the city’s general manager of corporate services and chief financial officer. “As a result of the appeal, the City of Campbell River will continue to follow Council’s tax policy of charging the provincial average tax rate on managed forest lands within City boundaries, except for lands where provincial restrictions apply.”

– with files from Kristen Douglas/Campbell River Mirror

 

 

Background

  • During the January 2014 financial planning meetings, Campbell River City Council approved tax rate increases for managed forest lands and utilities tax classes to be phased in over multiple years that would bring rates in line with the provincial average for these property classes.
  • The policy to increase taxation on these two classes aimed to address long-term funding needs while minimizing residential property taxes increases.
  • Council provided advance notice to companies affected by the increase.
  • The increase would affect all class 7 (managed forest land) properties in the city except for the Merrill and Ring lands, which are charged a rural rate according to a Provincial order set when these properties were incorporated into the city.
  • The increase restores tax levels for TimberWest properties classified as managed forest lands to a rate similar to what the company was paying in 2008, without protest, phased in over three years.
  • The BC Supreme Court announced its support of the City’s position on Jan. 23, 2015.
  • On Jan. 29, 2016 the BC Court of Appeal unanimously upheld the Supreme Court decision.
  • TimberWest had until March 29, 2016 to seek leave to appeal to the Supreme Court of Canada.

– Source: City of Campbell River