Farm tax ratio staying same for now

·3 min read

Chatham-Kent’s farm tax ratio will remain at 22 per cent at least for now.

Council delayed voting recommendation from administration that would see the farm tax rate increase to 25 per cent by 2023.

The report recommended the rate be phased in; rising to 23 per cent in 2021, up to 24 per cent in 2022, before finally hitting 25 per cent in 2023.

Chatham-Kent is only one of five municipalities in Ontario with a farm tax ratio lower than 25 per cent. Council set the 22 per cent rate in 2003 in response to area farmers struggling when hard hit by low commodity prices.

While farmers generally have very large land bases, administrators argue they are paying far less than even industrial and commercial users. They say based on every $100,000 of assessed value, farmers pay $25.22 in municipal taxes. Industrial users pay $232.32 and commercial properties and multi residential buildings pay $221.52 for every $100,000 of value.

A number of councillors took issue with the proposed hike, saying a decision can’t be reached until all the information is available. Elected officials want to how the next Municipal Property Assessement Corporation assessment — delayed by a year because of COVID-19 — will affect property values before making changes.

The cost of farmland has been rising steadily. Farm groups are concerned not only will they pay more based on changing the tax rate, but also because of increasing land value.

East Kent Councillor Steve Pinsonneault says the farm community has already been burdened with higher assessments, adding the hikes are making harder for the agriculture sector to do business.

“At every opportunity, they keep getting hit,” says Pinsonneault. He's frustrated Chatham-Kent, offers financial incentives to entice commerce and industry to expand, but not to farmers.

Pinsonneault says "all of the information is needed," before the decision can be made.

Joe Faas, who was on the 2003 council that made the decision to stay at 22 per cent, says politicians then thought lowering the rate to 22 per cent was temporary. It’s been 18 years and every time the issue comes to council it has been voted down.

Kent Federation of Agriculture president Jay Cunningham is pleased council has decided to wait for the MPAC changes before making a decision. Cunningham says proceeding with change would be premature and the issue needs to be examined “holistically.

“They’re trying to jump the gun,” he says. “We need to wait and see.”

Data from the MPAC is used to set tax rates throughout Ontario. The assessment happens every four years and was scheduled for 2020, but was put off because of the pandemic.

The matter is further complicated since the provincial government has delayed the property tax reassessment again. It announced during March 24th's budget MPAC would not release a 2021 assessment.

Chatham-Kent farmers currently pay taxes on 22 per cent of what a residential resident pays.

It’s been argued that residential ratepayers subsidize rural property owners and the disparity in the assessment is unfair to urban dwellers. Farm organizations say farmland does not require services such as arenas, parks, andgarbage disposal and should be taxed at a far lower rate.

Pam Wright, Local Journalism Initiative Reporter, The Herald