Pelham’s 2017 Residential Taxes Increase by 2.3%

Two months ago, I wrote about how Council approved our 2017 Operating Budget. Since the Province issued the property tax rate for Educational purposes last week, I can now provide you with an update on the total 2017 residential property tax bill.

You will recall that the amount of property tax you pay to the Town of Pelham, to the Region, and to the Province (for Education) is not solely based on the Market Value Assessment of your property; we multiply your assessment by each of these three tax rates and add them up for your total bill.

The Municipal Property Assessment Corporation (MPAC) – the Provincial body that sets a value your home and property – re-evaluated and assessed all properties in the Province as of January 1, 2016. While this amount will be used as the value of your home in 2017, MPAC phases in any assessment increases evenly over a four-year period.

Despite the recent double-digit home value increases and seller’s market, the MPAC assessment is to represent your property as of January 1, 2016. Further, the Town re-adjusts the tax rate down to compensate for the average overall increase in residential property values across the Town.

Now that the Region draft-approved the property tax rates and ratios and that the Province set their rate this month, we know that the combined property tax increase for an average residential property (valued at $316,400) in Pelham will be 2.3%.

Please note that this 2.3% is what folks term the “pocket-book” increase – the amount it cost an average residential property owner by adjusting for the average MPAC increase.

How do we measure whether that amount is “affordable” or not?

One independent way to judge whether Pelham’s taxes are “affordable” or not, is to compare them with inflation. For example, the Bank of Canada calculates that, over the last 11 years, inflation increased the value of goods and services by 19.7%. Over the same period, Pelham’s combined taxes for the average residential property in Pelham increased by 20.1% -- only 0.4% above inflation.

And, this 20.1% includes the equivalent of approximately 1.1% (in 2016) to fund the Pelham Community Centre. And, it also includes our annual increases for improved infrastructure – approximately 1.7% over the last three years of this 20.1% was for increased sustainability – supporting new roads, pipes, and other capital improvements.

Pelham Council and I continue to direct staff to ensure that we only minimally impact you and other property tax-payers while we increase the level and quality of services in the Town.

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26 June 2017 Update:
With the Region and the Province making some last policy changes and adjustments for rates and tax ratios, we now know that the combined property tax increase for an average residential property (which is valued at $316,400) in Pelham is 2.0%. Because of those changes, that’s actually a 0.3% decrease from what I reported to you above. Please see new chart and comparisons by clicking here.