Prices – They Are a Changing

Real estate prices have been in the headlines lately. Buying mania has reached our Innisfil neck of the woods over the last couple of years but I doubt foreign buyers are involved. Looking back over some figures, my property tax increased 73% in the last 16 years (an average of 3.7% per year); “market value” assessment increased by 133% (about 6.3% a year); but the current speculative market value of my property has increased about 500% (or more?) based on real estate agents’ estimates and recent home sales in the area. That’s about 10%/year compounded rate of appreciation.

We get approached about listing our home possibly once a week by mail or in person. I’m told that some real estate agents Continue reading

Places to Grow – in Barrie

McKayPlan1

A public meeting tomorrow in Barrie (council chambers, 7:00 pm) is further proof that Ontario’s Places to Grow strategy to limit urban sprawl is a failure – at least in Simcoe County. It also confirms that Barrie is a city without boundaries and an insatiable appetite for greenfields.

McKayPlan2

“The lands are designated Highway 400 Industrial/Business Park within the City’s Official Plan and are currently zoned Agriculture (AG) in accordance with Zoning Bylaw 054-04 (Innisfil). The owner has applied to amend the current zoning of the property to Highway 400 Industrial with Site Specific exceptions …”  Continue reading

The Wisdom of the Woodland

Regular readers may recall me writing occasionally about the Transition Network. With all the social, political and economic turmoil in the news lately, I was really impressed with an article by Rob Hopkins in the latest Transition newsletter: The Forest Economy: woodland as New Economy metaphor.

In it, he talks about the role of rain in a forest and how it gathers nutrients as it falls and circulates through the forest canopy and down tree trunks, and sustains a great diversity of life in the woodland ecosystem. He compares this to the globalized economy and talks about how a woodland can illustrate a model for a New Economy.

Here’s a brief excerpt. I hope many of you will read the full article (link above).  Continue reading

The Innisfil Water Wheel

The wheels continue to spin on a viable plan to bring sewer service to Innisfil Heights industrial lands. The prolonged examination of a strategy centred around the creation of a Municipal Services Corporation has come to an abrupt end.

An early staff report to Council (DSR-53-15, March 18, 2015) discussed a study from KPMG, which included an option for a Municipal Services Corporation:

“… the KPMG study concluded that the best option for the municipality was to create a municipal services corporation (MSC) and place the assets for both water and wastewater into that structure which would enable the MSC to separate the assets and liabilities from the Town’s books. The future debt capacity would vest with the new corporation consistent with the manner in which we handle the financial requirements of INNPOWER …”

“On January 1, 2016, the Town transferred the water and wastewater assets, including two water pollution control plants, one surface water treatment plant, municipal wells and the associated collection and distribution systems to InnServices [Utilities Inc.].  InnServices is also tasked with building over $200 million in new infrastructure …” [Town of Innisfil website]  Continue reading

Signs of High-Rent Blight

While Cookstown works within the framework of a Heritage Conservation District to preserve the essence of the community and Alcona struggles to create a new but traditional shopping district, both Innisfil neighbourhoods are plagued with under-utilized and undeveloped commercial spaces.

In my last article, I questioned the logic of giving property tax rebates on empty commercial spaces. It seems entirely counter-productive to the economic and social health of our community. However, in some circles, it’s seen as being ‘business-friendly’. I was told that the real problem is that Innisfil property taxes are too high. It was suggested to me that commercial rates should be lower to compete with neighbouring communities like Barrie. That seems too simplistic for a couple of reasons:

  • We already tried that approach on a national scale with lower corporate taxes and ended up with companies sitting on what the Bank of Canada described as a mountain of “dead” money. There can be little expectation that lower taxes for landlords would proportionally benefit their commercial tenants.
  • We shouldn’t necessarily be trying to energize our local economy by impoverishing a neighbor’s opportunities. Can’t we create incentives and opportunities to motivate entrepreneurship within our own growing community?

The factors involved are more complex and in trying to understand it, I came across a revealing article Continue reading

Better ‘Guidance’ Needed

The Cookstown HCD meeting (see my previous post) stressed the need to “guide” change to “preserve the essence of a community”, and underlined that people, not land, define the value of a place. I think a lot of the challenges Cookstown faces are also shared by Alcona. And I’ve come to the conclusion that we need more municipal tools to help create the kind of change we’d like to see.

Here in Alcona the Town invested millions of dollars to create the kind of attractive streetscape that would, according to planners, inspire commercial development in a designated shopping core. That work was substantially complete in 2012, and fully complete in 2013, yet 3 years later few desired results are evident. The air of frustration is evident among some Town staff as well as residents.

My own peeve is with some retail spaces that sit empty for prolonged periods, or transition briefly from one struggling business to another before falling empty again. I was startled to discover that the province requires municipalities to provide a 30% discount on property tax for most empty commercial space. This, to me, is an absurd subsidy that encourages speculators and unrealistic rents that are out of touch with market conditions. I’d say this Ontario tax policy is misguided and harmful to local economies.

Some news articles illustrate how ridiculous this tax provision is. The City of Toronto, for instance, paid out $367 million in property tax rebates between 2001 and 2013. That’s $30.5 million a year returned to landlords of idle Toronto commercial properties. Yet, this year, Toronto has a long list of “unfunded” budget priorities like $13.7 million for community housing repairs, $9.6 million for a poverty reduction program and $1.6 million to enlarge a school breakfast program in low-income areas. Does this make any sense? Shouldn’t tax policy act as an incentive to keep as many commercial spaces as possible occupied, instead of empty? Why should taxpayers subsidize the poor marketing decisions of landlords?

A speaker in Cookstown mentioned that potential developers pay close attention to the appearance of a neighbourhood, noting whether area properties look shabby, neglected, or run down. Several property owners along Alcona’s commercial core aren’t doing us any favours with their littered, overgrown frontages, and empty derelict buildings. Owners of other commercial buildings in Alcona are in no hurry, either, to find tenants.

Wasting the potential of these idle assets is stunting local grass-roots economic activity in Innisfil and all over Ontario. And, it can only be directly fixed by the Ontario government. Shouldn’t we use tax policy to discourage commercial space from sitting idle for a prolonged period? The legislature needs to remove this property tax rebate that rewards idle, wasted commercial assets. Towns all over Ontario need tax policy to guide change toward local, grassroots economic activity and revival.