London, Ont. committee endorses rental consultant to study how to deal with vacant homes – London | The Canadian News

In London, Ont. city ​​committee has endorsed a plan that will appoint a consultant to determine the feasibility of a vacant housing strategy and tax.

The motion, which was endorsed by a 4-2 vote at Monday’s meeting of the corporate services committee, ordered city staff to initiate a ‘request for proposals’ process for consultancy services, and to present the findings of the said consultant to the committee. to bring back at a later date.

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Staff are also being told to continue monitoring the implementation of a vacant housing tax in other Ontario municipalities. No one currently has such a tax, but two, Ottawa and Toronto, are expected to implement one next year. Several others, such as London, are investigating its feasibility.

Vancouver is currently the only Canadian city to have a vacant home tax, and implemented it in 2017, according to a report of city staff which went before Monday’s meeting.

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The appointment of a consultant is not a foregone conclusion. Full city council has yet to vote on the motion, and will do so at a February 15 meeting.

City staff estimate hiring a consultant will cost between $ 100,000 and $ 150,000, with the RFP process taking up to five months, based on timelines seen in other municipalities.

The text of the original recommendation of city staff (above), and the amended motion on which committee members voted (below).

City of London

The move to appoint a consultant came as a result of an amendment proposed by Ward 5 Coun during the meeting. Maureen Cassidy.

City staff recommended in their initial report that the council not continue with a vacant house tax, saying that it would cost more annually to implement than it would bring into the city coffers, “which could be an additional cost to the city. property taxpayer will cause. “

In calculating the cost, city staff assumed that about 0.5 percent of residential properties in the city were vacant, or 783.

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Based on that, staff estimate that a one percent vacant home tax will bring in $ 2 million in tax revenue annually, but will cost $ 2.1 million a year in administration costs to pay for inspectors, administrative and audit staff, IT services and materials costs.

Staff also estimated that implementing the tax itself would cost a one-time $ 5.5 million for “public education, and technology building and support for tax administration, auditing capabilities and online declaration.”

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In Vancouver, where property owners are required to declare their property status occupied or unoccupied, the implementation of the vacant home tax cost $ 7.4 million and $ 2.9 million a year to administer, according to the staff report presented Monday.

The report notes that taxes generated an average of $ 37.8 million annually for the City of Vancouver between 2017 and 2019, with more than $ 30 million spent on affordable housing initiatives. The number of vacant properties there has dropped from three to one percent. The city raised the tax rate to three percent last year.

It is not entirely clear how many vacant homes there are in London, as the city does not keep a register of vacant properties. The staff report notes that the city is only aware of 62 vacant housing units in the city, identified on the basis of inspections and public complaints.

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“Obtaining a consultant will provide a more accurate estimate of both the number of vacant properties in London and the associated costs of administering a Vacancy Home Tax,” the staff report said. More accurate information will also help determine the tax rate yourself.

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The tax is meant to encourage property owners to sell or rent out their unoccupied residential properties to increase the city’s housing stock, or to pay a tax to keep it vacant.

Mayor Ed Holder questioned the purpose of implementing such a tax, arguing that it would not help deal with property speculation, or make a big dent in the city’s homelessness problems, if it were issues that the tax aimed at helping alleviate.

“If the issue was demolition through neglect or properties with property standards issues, I can get out of there. “I can see why we might want to put a few more teeth, if in reality we do not feel that there are sufficient penalties or encouragement to comply,” Holder said.

“If I can speculate about it – forgive the pun – I do not know what we are trying to solve with this.”

Ward 6 gr. Mariam Hamou, who along with Holder voted against the motion to appoint a consultant and monitor other municipalities, said she was also struggling “to understand what the purpose is.”

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“If we are looking for a solution to homelessness, or using another tool in the toolbox, can we compare how much money we are going to spend on this with a few other solutions to remedy homelessness?”

“If it’s about the other issue of abandoned owners, then we’ve dealt with it in a different ordinance,” she said, referring to the city’s vacant buildings ordinance, which was updated in March last year.

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Committee chairperson and Ward 2 gr. Shawn Lewis argued that a vacant home tax could be a tool to deal with various issues. Lewis and Ward 12 Earl. Elizabeth Peloza submitted the initial motion last summer to have staff investigate the idea of ​​a vacant home tax.

“It can be used to address the demolition through neglect. It can also be used to impose a financial penalty for the cost of vacant homes on speculators, ”he told the committee.

Lewis noted that it could also encourage some landlords to lower rental rates to fill vacant units rather than defy the burden of a tax, which could cost them more than the reduced rent.

“What (this report) really emphasizes is that we do not have nearly enough information to know whether we should move forward or not,” he said.

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“Therefore, I think it is a valuable investment to move forward and gather more information so that it can come back to us and we can make an informed decision at that time.”

Near the end of the discussion, Ward 13 gr. John Fyfe-Millar suggested that the wording of Cassidy’s amendment itself be amended to prevent the use of the word “tax,” which he said “limited our scope.”

“I will be much more open to a conversation or a direction about a vacant house strategy. Tax… tells us this is the only way we have to move forward. “But if the real purpose here is to fill vacancies, then I would like to see if we go to a consultant, to say, ‘give us some options,'” he said.

The motion was later revised to instruct staff to hire a consultant to “study and review a Vacancy Home strategy, including but not limited to the implementation of a Vacancy Home Tax.”

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