Has there been any consideration given for the residents and businesses located in Emerald Park, due to the fact that tax dollars have already paid for infrastructure and development once and well be expected to pay for it a second time if this annexation goes ahead?
The residents and businesses in the area have paid for, and own, all the infrastructure in the annexation area. There is no reason that residents of the annexation would have to pay for infrastructure they already own. Including compensation for streets and other infrastructure that has already been paid for by the residents would be double paying for that infrastructure. That is not the purpose of tax loss compensation.
The tax loss compensation calculation takes into consideration the net financial benefit or loss to compensate the other municipality for impact in day to day operations resulting from annexation.
Suggesting that tax loss compensation would be $38 million dollars and would be required to be paid up front is not supported by recent Saskatchewan Municipal Board decisions and considers only revenue lost to the RM. Tax loss compensation also considers the amount of expenses the RM will shed as well.
In the 2017 financial report and 2018 budget for Emerald Park, the RM indicates it is using tax dollars from other areas of the RM to subsidize the services provided to residents of Emerald Park. The budgeted subsidization in 2017 was nearly $485,000, while the actual subsidization was $262,400. In 2018, the budgeted subsidization was just over $164,000. It is clear from the RM’s documents that the annexation would have a net benefit effect on the RM, thus freeing up over $260,000 of property taxes for services to be provided in the remainder of the RM.
Tax loss compensation requires communication between the two municipalities to determine the annexation area and then the net benefit or net cost to the other municipality. Only when this is established can the actual tax loss compensation be decided.
More Frequently Asked Questions
- Why did the Town of White City not create it's own water utility and what will happen to water rates in Emerald Park?
- How is White City Administration preparing for potential annexation?
- I have a private well on my property, will I have to connect to the town’s water system if we become one community?
- White City and Emerald Park handle on-street parking differently. What will happen if we become one community?
- How much is the annexation proposal and application to the SMB going to cost?