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This article was published 6/3/2015 (2024 days ago), so information in it may no longer be current.

City councillor Ross Eadie said using the frontage levy to supplement property taxes is a regressive form of taxation that has a greater impact on lower-income people.

Eadie (Mynarski) said Mayor Brian Bowman believes he’s kept a campaign promise with a 2.3 per cent property tax increase but he also proposes to increase the frontage levy by 60 cent a foot to raise another $6.7 million.

"Everyone knows the frontage levy is just another tax," Eadie said. "He can’t keep his campaign promise so he should just raise property taxes to bring in the additional money he says he needs."

The frontage levy is a charge based on the width of a homeowner’s lot. The wider the lot, the greater amount the homeowner pays to the city in the form of the frontage levy.

The frontage levy now is set at $3.75 per foot. The budget proposes to increase that to $4.35 per foot. For a 50-foot lot, the annual increase would be $30.

Eadie said the $6.7 million raised through the increase in the frontage levy is the equivalent of an additional 1.37 per cent property tax increase.

Eadie produced a chart that examined the impact of the frontage levy on 23 different properties across the city. His research found that the 60-cent-per-foot increase on the frontage levy raised more revenue from lower-valued homes than if the equivalent 1.37 per cent property tax was applied to the home.

"If the mayor says he needs another $6.7 million, then he should raise that money using the property tax, not the frontage levy," Eadie said. "The frontage levy hits lower-income people harder than those with a more valuable home."

Eadie’s chart shows the owner of a 50-foot-wide lot on Alexander Avenue (assessed at $107,000) pays the same frontage levy as the owner of a 50-foot-wide lot in Old St. Vital (assessed at $173,000).

But if both homes faced an additional 1.37 per cent in property taxes, the owner of the Alexander Avenue home would pay an additional $8.82, while the owner of the home in Old St. Vital would pay $14.26.

Eadie said that the greater the value of the home, the smaller the share of the $6.7 million the owner contributes when only paying based on the width of the lot.

"Using the frontage levy forces lower-income people to pay a greater share of the revenue than if it was done solely using property taxes," Eadie said. "Some people say that property taxes in general are unfair but it’s better than raising revenue from a frontage levy, which is not fair at all."

Eadie said he hopes he can get support from other members of council to scrap the frontage levy increase and replace it with a higher property tax increase. He said he will make a presentation later this month to the executive policy committee.

aldo.santin@freepress.mb.ca