Pelham’s 2018 Blended Residential Taxes Up 1.9% -- 12 Year Increase Less Than Inflation

If you pay your property taxes by installments, you will know that the second installment of your 2018 property tax bill comes due in two weeks (April 30). With this deadline approaching, I wanted to tell you about Pelham’s 2018 blended residential property tax increase – at 1.9% – and also to compare with other Cities and Towns.

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

With both the Region and the Province making some 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 $328,138) in Pelham will be 1.9% for 2018. That means an average residential tax bill of approximately $4,187 or an increase of about $79 over last year. (Because of some rates changes, that’s actually a bit lower than the 2% to 2.3% range that I reported to you in February.)

You can consider this $79 or 1.9% a “pocket-book” increase – an increase in the amount it cost an average residential property owner because it’s adjusted for the average MPAC increase in Pelham.

Since Pelham’s portion of your property taxes represents roughly 39% of the total bill, the Town will make use of about $1,618 of the $4,187 for the average residential property.

Who gets the most? The Niagara Region will get about $2,012 or 48% of the total amount. Meanwhile, the Province will receive the remaining approximately $558 (or 13%) to help fund education.

How do we measure whether the increase is “affordable” or not?

One independent way to judge whether Pelham’s taxes are “affordable” is to compare with inflation. For example, the Bank of Canada calculated that, over the last 12 years (February to February), inflation increased the value of goods and services by 22.7%.

Over the same period, Pelham’s combined taxes for the average residential property increased by 22.0% – a bit lower than inflation. Essentially, that means that the average home is paying the same level of taxes in 2018 that they did in 2006!

And, this 22.0% over 12 years includes so many improvements in our community – from renewed Downtowns in Fonthill and Fenwick, to new Fire Halls in Fenwick and North Pelham, from nine renewed playgrounds, to a new skatepark and a new dog park, from a renewed Maple Acre Library to a renovated Old Pelham Town Hall, from 15 km of new sidewalks and 5 km of new trails to the new Meridian Community Centre. And, the list of other infrastructure and services goes on and on.

Another way to judge would be to compare with other Niagara Cities, Towns, and Townships.

Last Fall, the Region published a corrected table of non-blended property tax increases from 2010 to 2017 for local municipalities. If you start at zero in 2010 and add up the cumulative increases, Niagara Municipalities increased their property taxes an average of 35% over those eight years.

Pelham stands as the forth lowest because ours increased 30% – including an increase in funding for the Community Centre in 2016. That’s 14% below the average increase of other Cities and Towns for the same period. Three other growing Towns – Grimsby, Niagara-on-the-Lake, and West Lincoln were lower than Pelham since 2010.

Pelham Council and I continue to work together with staff to ensure that changes in property taxes only minimally impact you and your neighbour while improving the level and quality of services in the Town.


Please check out historic charts or read past columns at www.pelhammayordave.blogspot.ca. Please contact Mayor Dave at mayordave@pelham.ca.

Assessment Only Half the Picture

Have you received your new residential property assessment notice from MPAC – the Ontario Municipal Property Assessment Corporation? (If you own a farm, business, or multi-residential property, you should receive your assessment mid-October.)

Updated for the first time since 2012, your notice will outline MPAC’s determination of the market value of your property as of January 1, 2016.

MPAC considers many factors when assessing property values, such as the sale prices of comparable properties in your neighbourhood, and the age, location, characteristics, and size of your property and home. In essence, MPAC strives to base their value on the amount your property could have sold for on the open market.

Just like in 2012, property assessments will remain the same for the next four years – from 2017 to 2020. However, if the value of your property increases, that increase will be phased in over the four years; if the value goes down, you will immediately see a reduction.

For example, if the value of your home increased by $20,000 over its current assessment, the value for determining your property tax will increase by $5,000 per year over the next four years.

If the value of your home goes up, does that mean that your property taxes will also go up?

No, not necessarily. Market Value Assessment is only one half of the property tax equation. The amount you pay to the Town of Pelham, to the Region, and for Education is based on the Market Value Assessment of your home multiplied by the three tax rates and added together.

Say the Town budgeted for revenues of $10 million from property taxes in 2017. If all assessments double, the Town would cut the tax rate in half to collect that $10 million. If everyone’s assessments went down, we would increase the rate to collect the same $10 million.

But, what if your assessed value increases more than the average?

The property tax system is a bit of a blunt instrument. Municipalities set the tax rate based on the average assessment for each of the tax classes – residential, multi-residential, commercial, industrial, farm/managed forest, pipelines.

If your property’s assessed value increases more than the average, you will likely pay more than the average tax. By the same token, if your assessed value increases less than the average, you will likely pay less tax.

What if you don’t think the MPAC assessment on your property is correct? You can issue a “request for reconsideration” before November 30, 2016 for residential properties so that MPAC will review your assessment. (Owners of farm, business, and multi-residential properties must file reassessment requests 120 days from the assessment issue date.)

Please check out MPAC’s website (www.mpac.on.ca) and your notice for more information.