Two downtown property owners will receive a break on their property taxes.
Council, at its Monday meeting, approved the incentive which is part of city council’s tax exemption bylaw aimed at revitalizing the downtown core.
The program applies to targeted areas to entice business owners to invest in the city’s downtown.
The most recent tax breaks were awarded to Beach Fire Brewing – the brew pub on the corner of Cypress and 11th Avenue – and NIEFS which is renovating the commercial building on the corner of St.Ann’s Road and Alder Street.
“Significant interior renovations are required to better facilitate this function,” Brian McLoughlin, the city’s clerk technician, said of the improvements to the NIEFS building.
It is the cost of that new contruction, estimated by the city to be worth $630,500 that is eligible for the tax exemption.
For Beach Fire Brewing, improvements to its building, estimated at $222,000, are eligible for the tax break.
McLoughlin said that based on 2016 tax rates and new construction of $222,000, the estimated tax exemption would be $2,491 per year for a five-year estimated exemption of $12,457 for the brewery.
For NIEFS, the five-year exemption is estimated to total $23,750, or $4,750 per year.
At Monday’s council meeting, Mayor Andy Adams questioned whether those amounts were estimates or actual values.
Ron Bowles, the city’s corporate services manager, said the figures are estimated by city staff using the tools available to them.
“BC Assessment will look at the improvements and see if those improvements have added value,” Bowles said.
“By and large they do. It’s a best estimate that staff can do but we won’t know for sure until BC Assessment has done their work.”
While the two businesses will be catching a break on the additional property taxes as a result of new construction, they will still have to pay annual property taxes throughout the five-year exemption period.
NIEFS will pay $17,792 in taxes annually on its pre-construction assessed value while Beach Fire Brewing will pay $3,914 per year on its pre-construction assessed value.
Both businesses will start paying full property taxes in 2022.
The two properties are just the latest in a string of local businesses that have taken advantage of the revitalization tax exemption since it was established by city council in 2011.
The first businesses to come forward were CR DanceXtreme &Fitness and Tyee Chevrolet, which both applied for the tax break in 2012.
Tyee Chev’s application was for additional taxes piled on as a result of construction of its new show room while CR DanceXtreme’s savings came on construction costs incurred while building its dance studio downtown.
Berwick by the Sea and Seymour Pacific are also currently locked into the five-year tax exemption program as is the new apartment building in Tyee Plaza on the former SuperValu site.
The City of Campbell River’s downtown revitalization tax program is applicable to commercial and multi-family developments within the downtown area.