South Dundas - May 28, 2012 - Things are brewing in the United Counties of Stormont,
Dundas and Glengarry. At a recent meeting of County Council they voted
to reduce the multi-residential tax rate to help spur development of
more rental units in the counties. Great idea in concept, but I feel
the implementation is short-sighted.
In areas of the United Counties where there is development potential,
this reduction is good news for developers. According to officials in
North Dundas, developers have been beating down the door wanting to
build in Winchester, but the tax rate scared them off. In areas of
South Stormont and South Glengarry that surround Cornwall, this also
could be a good thing. But as someone who lives in an area less likely
to benefit, South Dundas, the big question is: Are my taxes going to
Counties council has passed tax increases every year for the last
seven years. It may have been longer than that, however I've lived
here seven years so that's my reference point. By comparison, the
Township of South Dundas has not increased taxes any in those same
seven years. In fact, for many years, the township's tax rate was
reduced to compensate for increased revenue from MPAC assessment
increases. Even now, revenues in South Dundas have only increased
because of MPAC, not from council voting to increase tax rates. How
has South Dundas done that? By keeping costs low, buying only what
they need, doing more with less. Yes South Dundas is addicted to
outside consultants still, but otherwise they are pretty frugal.
Other townships in the counties are not so fortunate to have the
fortitude to live within their means. The county government hasn't
done that either; nor Cornwall. In fact, Ottawa elected a mayor who
pledged to raise taxes by no more than 2.5% per year. So if the
counties wants to reduce their revenue from multi-residential
properties, they will have to do one of three things:
1. Increase residential taxes to compensate.
2. Hope that the new rental developments will bring in enough revenue
to offset the cuts.
3. Cut spending.
I honestly don't believe there are too many developers willing to come
in to the counties and build rental units. Not with the ownership
market being the way it is and with interest rates being as low as
they are. There also aren't really any new jobs here to increase the
demand for rental housing. Sure Target is opening a distribution
center in Cornwall, but Cornwall also has a rental market that's ready
to serve the influx of new hires.
Option three of cutting spending is not going to happen because the
counties are unable to keep their costs in check. There is no will or
political direction to keep costs in line with revenues.
As for development in Winchester. Yes, the village is becoming a
bedroom community for Ottawa commuters, but it does not have the same
factors going for it that Kemptville did 10-15 years ago which has
contributed to that town's boom. There is no four-lane highway being
built making the commute fast. The population grew in Kemptville
thanks to being on Highway 416 and the route it took to the high-tech
areas of Ottawa. Winchester is no Kemptville.
In the end the plan to reduce taxes to spur growth is a good one. But
without any plan to fill in the void that reduction leaves means all
residents will pay for it because County Council is unable to keep a
tight grasp on the purse strings.