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The owner of an eyesore vacant parcel or contaminated brownfield pays far less in taxes than his neighbour with a commercial building. The city wants to turn that model on its head, to discourage property owners from squatting on land, and to discourage them from tearing down buildings just to lower their taxes.

Under existing provincial law, municipalities can only have one tax rate for commercial properties. There’s no way for the city to use its tax rates to reward “productive” properties and penalized nuisance ones.

“Contaminated properties lying fallow pay much lower taxes,” says Mayor Don Iveson. “We need to send a price signal to owners to clean up and develop. There’s a value in giving us the tools to deal with legacy problem lands.”

Just this week, the provincial government in British Columbia promised to amend Vancouver’s city charter to give the city the power to tax vacant houses and condominiums as a higher rate. Vancouver, with its soaring residential property prices, has a problem with real estate investors, both local and offshore, buying homes and condos and allowing them to sit empty. Vancouver Mayor Gregor Roberts says homes bought for investment purposes aren’t residences but business holdings, and should be taxed accordingly. Edmonton is looking for somewhat parallel power from the Notley government here.

Iveson says Municipal Affairs has been quite open to the idea of allowing cities to set differential tax rates for commercial properties. But the devil is in the details.