Area Rating

[waterloowarrior]

For anyone interested, Ottawa had a report done comparing costs for urban/inner suburban, suburban, rural and village residential development. They found that urban development pays significantly more taxes than the cost for city services, while the others all paid less taxes than the cost of services (i.e. urban subsidizing suburban and rural, although the suburban difference wasn't as bad). One of the big reasons rural residents cost a lot is the road budget... only 10% of the population was rural/village but they took up 44% of road operating (maintenance/snow clearing) budget and about 1/3rd of the capital budget.

http://www.ottawa.ca/calendar/ottawa...cument%205.pdf

[highwater]

Thanks for posting!

[emge]

Originally Posted by waterloowarrior

For anyone interested, Ottawa had a report done comparing costs for urban/inner suburban, suburban, rural and village residential development. They found that urban development pays significantly more taxes than the cost for city services, while the others all paid less taxes than the cost of services (i.e. urban subsidizing suburban and rural, although the suburban difference wasn't as bad). One of the big reasons rural residents cost a lot is the road budget... only 10% of the population was rural/village but they took up 44% of road operating (maintenance/snow clearing) budget and about 1/3rd of the capital budget.

http://www.ottawa.ca/calendar/ottawa...cument%205.pdf

Excellent.

For several of these continually recurring issues of citywide importance (e.g. urban vs. rural taxes and costs) me (or someone better at it than me) should make a visual representation of perception vs. reality and link to the hard evidence supporting it.

I like what Hamilton Light Rail did for the benefits of light rail... something like that, for all issues..

I'll get on that the first spare minute I have... oh wait..

[SteelTown]

Looks like this upcoming election will turn into a referendum.

Area rating delayed for public input

November 25, 2009
Emma Reilly
The Hamilton Spectator
http://www.thespec.com/News/Local/article/678883

City council has postponed a decision about Hamilton's controversial tax system to allow for a year-long public consultation process.

In a narrow 8-7 decision yesterday, council approved Mayor Fred Eisenberger's proposal to form a citizens' jury that will debate area rating.

The jury will be made up of randomly selected citizens who will report back to council on Nov. 30, 2010 -- five weeks after the Oct. 22 election.

In August 2008, council unanimously agreed to implement changes to area rating in 2011. However, several councillors believed they had voted to update the area rating system this term and implement it after the next election.

Eisenberger told council members he "strongly disagreed" that was the case, a position that angered several councillors.

"It was very, very, clear -- this council was going to make the decision," said Councillor Scott Duvall, who orchestrated last year's motion. "Everybody at this table agreed to that. Everybody, Mr. Mayor, including yourself."

Councillor Tom Jackson put forward a motion that would have shrunk the consultation timeline from a year to six months. He proposed the jury should report back June 30, 2010, rather than Nov. 30.

"To me, that would stay in the vein of what council had approved a year ago," he said. "If the six months doesn't work, I won't be able to support this."

Jackson's motion was also defeated by an 8-7 vote.

The area rating system was implemented after amalgamation in 2001. Since then, each former municipality has been taxed differently based on the recreation, transit and fire services they receive.

However, city staff say these tax divisions are still based on old boundary lines when services are not. It means some rural areas are using services for which they are not being taxed.

Both of yesterday's votes were divided between urban and suburban lines, save for downtown Councillor Bob Bratina. He voted in favour of the citizens' jury along with the rural councillors.

Bratina said he agreed to support the mayor before the meeting and said he wasn't swayed by any arguments at yesterday's meeting.

"Nothing changed my mind."



HOW THEY VOTED

For: Bob Bratina, Fred Eisenberger, Lloyd Ferguson, Margaret McCarthy, Dave Mitchell, Robert Pasuta, Maria Pearson, Russ Powers

Against: Chad Collins, Scott Duvall, Tom Jackson, Sam Merulla, Brian McHattie, Bernie Morelli, Terry Whitehead.

[SteelTown]

Council votes to drag its feet for a year

Andrew Deschel

Mayor Fred Eisenberger has developed a real knack for putting his foot in his mouth when it comes to dealing with area rating.

Last year, while arguing in favour of putting off a decision so as not to offend the suburbs that benefit from the unfair tax policy, he maintained that, “Harmony overrides fairness.”

Yesterday, while squeaking out an 8-7 victory to once again defer the vote, Eisenberger was at it again.

But this time, he even topped his previous groaner.

“It takes the city of Hamilton three months to change its underwear if something has to be done by committee,” he said.

Truth to tell, he had already trotted out that line the day before while visiting The Spec editorial board to promote his idea of hiking the controversial issue off to a citizens’ jury.

He used it by way of justifying why a citizens’ group would need a full year to study the matter.

Oddly, Eisenberger seems blissfully unaware of how badly that statement reflects on him.

Here he is, the mayor, sardonically commenting on how long it takes to get things done in Hamilton as if he has no say or is helpless in the face of a prevailing inertia.

And yet, at the same time, he’s using the observation as if it somehow justifies his push to delay making a decision until after the next election, a full year from now.

It’s as if Eisenberger has never heard the admonition that if you’re not part of the solution, you’re part of the problem.

Make no mistake, Eisenberger is certainly a big part of the footdragging problem in this case.

Let’s briefly recap.

Area rating is a tax system used since amalgamation to cushion suburban tax rates by permitting different areas to pay lower amounts, depending on the recreation, fire and transit services they receive.

The system, however, doesn’t always accurately reflect how services are actually delivered, which means, in some cases, the old inner city is subsidizing the more affluent suburbs.

City staff studied the issue for more than a year and produced a report outlining options, including a compromise recommendation that more fairly aligns taxation to costs and service levels.

Problem is, overhauling the system will mean suburban tax increases, which is anathema to suburban councillors.

That’s why yesterday’s 8-7 vote virtually split along suburbaninner city lines.

Bob Bratina was the only inner city councillor who voted in favour of Eisenberger’s idea of handing the hot potato off to a citizens’ group, which will report back after the 2010 municipal election.

Eisenberger insists the timing has nothing to do with political convenience.

But that’s pure banana oil. If that wasn’t the case, he and the suburban councillors would have supported Councillor Tom Jackson’s amendment to change the reporting date for the citizens’ group to June of next year.

That would have allowed for six months of public consultation and still given this council an opportunity to vote on the change instead of handing it off to the next council to deal with.

Jackson’s amendment lost 8-7, with the mayor leading the charge against it.

Eisenberger’s drive to put off dealing with this touchy issue until after voters have gone to the polls clearly erodes his credibility as a new-style politician.

I’ve said before that Eisenberger is growing in the job. I suppose this is more proof of it. His ducking and weaving suggest he’s added old-style political expediency and procrastination to his bag of tricks.

Under his leadership, council has put off for tomorrow what could have been done today.

Three months to change your underwear is no longer enough time in Hamilton.

Mayor Fred has raised the bar to 12 months.

[realcity]

well said Dreschel

[Zaz]

Originally Posted by SteelTown

In August 2008, council unanimously agreed to implement changes to area rating in 2011. However, several councillors believed they had voted to update the area rating system this term and implement it after the next election.

Eisenberger told council members he "strongly disagreed" that was the case, a position that angered several councillors.

"It was very, very, clear -- this council was going to make the decision," said Councillor Scott Duvall, who orchestrated last year's motion. "Everybody at this table agreed to that. Everybody, Mr. Mayor, including yourself."

Seriously? Was no one keeping meeting minutes?

[SteelTown]

I don't think we do actually.

[flar]

I've seen these types of organizations before, the ones where they start fresh at every meeting, holding the same debate over and over, never accomplishing anything.

[ryan_mcgreal]

http://raisethehammer.org/article/980/

Council Cop-Out on Area Rating

Council is passing the buck by shifting the political heat that radiates from area rating off their own backs onto a randomly selected group of residents.

By Ryan McGreal
Nov. 25, 2009

Council has failed yet again to fix the thorny issue of area rating, the city's policy of charging different tax rates to different parts of the city for transit, recreation and fire services. Last night, instead of making a decision on area rating, a slim majority of councillors voted at a Committee of the Whole meeting to establish a citizens' jury of randomly selected citizens to spend the next year studying options to fix it.

Area rating dates back to amalgamation as a way to soften the adjustment for surrounding municipalities, but Hamilton is the only city in Ontario with such a system. As a result, the old city of Hamilton pays nearly three times as much for transit as residents in Glanbrook, three and a half times as much as residents in Stoney Creek, four times as much as residents in Dundas, and nearly five times as much as residents in Ancaster.

Back in 2008, Council acknowledged that the area rating system is broken and voted unanimously to endorse Councillor Scott Duvall's motion to resolve the issue before Council's mandate ends in the 2010 municipal election.

However, Councillors are in dispute as to whether they had agreed to resolve area rating before the mandate ends and implement it in January 2011 (Duvall's contention), or else to resolve it in 2011, as Mayor Fred Eisenberger argued last night.

Staff Recommendation Misses Point

At last night's committee meeting, staff presented a recommendation to eliminate area rating by raising suburban rates and lowering urban rates so that everyone pays the same rate and the overall change is revenue-neutral for the city.

I've been arguing that this is a terrible idea for transit: it would further deepen the conflict between urban and suburban ratepayers without generating any new money for transit, and it would effectively force the HSR to redistribute its already inadequate resources across an even larger area (given that the current rating assumes the old city gets more service and the suburbs get less service).

On the other hand, if suburban rates were raised so that they are closer to what the old city pays - to $148 on a median-priced home compared to $195 on a median-priced home in the old city - the city would receive over $7 million in additional funding, which could then be used to improve service across the city.

Unfortunately, the staff report is committed to making any change revenue-neutral - even though council did not instruct them to do this when they asked for a recommendation - and did not offer alternatives for the Councillors to consider.

Politically Convenient Citizens' Jury

The Committee of the Whole rejected the staff report but then narrowly passed Mayor Eisenberger's proposal for a citizens' jury. A compromise by Councillor Tom Jackson to have the citizen's jury run for six months instead of a year was narrowly defeated.

Setting aside the fact that this means Council won't vote on area rating reform before the 2010 election, the decision feels like a cop-out. Council is passing the buck by shifting the political heat that radiates from area rating off their own backs onto a randomly selected group of residents.

Councillors who supported the citizens' jury argue that it represents "public consultation", but real public input entails broad-based participation, two-way dialogue between the city and residents, and a final council decision that reflects the public will.

A citizens' jury does none of this. A randomly-selected committee of residents may or may not do a better job of researching alternatives than staff, and they may or may not do a better job of choosing among options than elected Councillors; but they simply replace one narrow, closed process for another.

It's hard not to conclude that the real value is political: the novelty of an uncommon deliberation process and the convenience of a scapegoat if the decision turns out to be controversial (and it will).

Another Urban/Suburban Split

Another interesting thing to come out of this was the sharp urban/suburban split in votes. With one notable exception, all the urban councillors voted against the citizens' jury and all suburban councillors voted for it. It almost precisely mirrors the recent vote split over the proposed HSR fare increase.

The suburban councillors, who have the most to lose politically by fixing area rating, uniformly voted for the citizens' jury, which won't present its recommendations until after th 2010 election. On the other hand, all the urban councillors except Councillor Bob Bratina voted against the citizens' jury.

Today, Bratina posted an essay on his website ("Area Rating", 2009-11-25) explaining his decision:

Blanket removal of Area Rating would bring a modest decrease in taxes in the older part of the City, but a significant double digit increase to those in the newer areas. Nevertheless Council has set a date for implementation of a phased-in plan to deal with the problem. The date was and continues to be January 2011. Mayor Eisenberger understands the volatility contained in the application of these measures and put forward a process that allows for broader public understanding, and a buffering to the still-extreme emotions stirred by what has been said and done in the past.

He added that the Ward 2 residents he has spoken with don't know anything about area rating, so it is important to precede any decision on area rating with a period of public outreach.

[SteelTown]

Duvall and Powers lay it on the line

Andrew Dreschel

Deputy mayor Margaret McCarthy, who was chairing the council meeting, came equipped with a stopwatch to enforce the five-minute speaking rule.

Councillor Sam Merulla came armed with a motion to make sure the future operating costs of any Pan Am Games facilities won’t be area rated, meaning suburban taxpayers will have to pay their fair share.

But Councillor Scott Duvall, he came loaded for bear.

With good reason.

Last year, Duvall was widely credited with spearheading a compromise on area rating, the contentious tax policy that has pit the inner city against the suburbs since amalgamation.

Back then, rather than accepting the status quo and studying the issue for two more years, the central Mountain councillor worked behind the scenes to get his colleagues to commit to voting on a new policy this term, which would
be implemented when the new council takes over in January 2011.

Trouble is, though council voted unanimously in favour of Duvall’s proposal, the voting deadline was not explicitly spelled out in the resolution.

That omission gave Mayor Fred Eisenberger the wiggle room to propose handing the issue off to a citizens’ group for another year of study rather than voting on a staff recommendation to phase in a new policy ensuring the suburbs pay for the services they receive.

Several inner city councillors have argued the mayor’s initiative flies in the face of the spirit and intent of Duvall’s work.

Interestingly, the suburban councillors, who all support Eisenberger’s stance, have been uniformly silent on that score.

Only Eisenberger has publicly denied Duvall’s version of events.

He did so again the other night, before council ratified his citizens’ group in a 9-6 vote.

Those denials clearly got under Duvall’s skin. Neither a fluent nor well-ordered speaker, he is at his best when he shoots from the heart.

He unloaded all four chambers at Eisenberger.

Everybody around the council table, said Duvall, knew that the thrust of his motion was to vote this term, not put it off until after the next election.

“Anybody who believes that wasn’t the intent of that motion should take a good look in the mirror because whoever he sees there is fooling himself.

“That’s the person you’re fooling, nobody else.”

Duvall then took Eisenberger to task for suggesting civic harmony is more important than fairly paying for city services.

“I guess you can have harmony as long as you pick it out of someone’s pocket and say that’s fair.”

Others laid it on the line, too.

Terry Whitehead held up a list of 300 households in his west Mountain ward located on the border with Ancaster.

He said each of them get exactly the same services as their suburban neighbours across the street, yet, thanks to area rating, they’ve paid $2.5 million more in taxes since amalgamation.

East-ender Chad Collins dismissed claims that the issue is so complex, the public needs to be consulted and educated for a year.

“It’s not like we’re trying to teach people how to read Egyptian hieroglyphs,”
he said. “I don’t want to inflame people, but at its base what we’re talking about is paying for services that you receive.”

But only Russ Powers of Dundas came close to matching Duvall’s raw sincerity.

After praising staff’s analysis of the issue, Powers explained why he supported the mayor’s plan instead of staff’s recommendation.

“Am I selfish? Yes. Am I parochial? Yes. Am I biased? Yes. “But would you stand for a 7.3 per cent increase for your residents if the vote was put to you now? The answer would be no, you wouldn’t.”

True, Powers neglected to say that staff wants to phase in all increases over eight years.

But give him full marks for honestly identifying what’s motivating the suburbs — selfishness, parochialism and bias.

[SteelTown]

Citizens’ Forum Report on Area Rating

http://www.hamilton.ca/NR/rdonlyres/...en_s_Forum.pdf

Summed up:

Citizens’ Forum endorses the staff recommendation on Transit
Citizens’ Forum endorses the staff recommendation on Culture and Recreation
Citizens’ Forum rejects staff’s recommendation on Sidewalk Snow Removal in Ward 12.
Citizens’ Forum endorsed the staff position on area-rating sidewalks and streetlights

[SteelTown]

Looks like council is going to finally vote on the area rating next week. The next day they'll finalize the vote.

[SteelTown]

Area rating: Nobody gets a break

City council has put the area rating debate to bed.

But if you’re an urban taxpayer, don’t expect your taxes to drop.

The city voted Thursday to institute a new system for area rating that adds a “special capital levy” to only the old city of Hamilton. That extra tax – which will bring in an additional $3.4 million to city coffers each year – will be spent on infrastructure updates in the old city alone.

That also means that every area of the city will face a tax increase in 2011.

Council’s decision on area rating – which was years in the making – was lauded as a compromise that satisfies both urban and suburban councillors.

Councillors spent the majority of Thursday morning’s budget meeting congratulating staff and their colleagues for finally tackling the issue.

“The fact that we can support this motion here today dispels dysfunctionality around this table,” said Councillor Terry Whitehead. “We put the most divisive debate since amalgamation to bed. That’s a credit to everyone around this table.”

“I’m so proud of this group to have this kind of discussion at the end of this long and difficult road,” said Mayor Bob Bratina.

The final vote was unanimous and was met with a standing ovation from senior staff.

Area rating, the city’s tax system, has long been a contentious issue for councillors. Since amalgamation, people in the suburbs have paid less than their urban counterparts because they have traditionally received fewer fire, recreation, and transit services.

However, in the years since amalgamation, those services have expanded to rural areas without an adjustment of their tax rates. That means some rural areas are benefitting from services that they’re not paying for.

The area rating update was intended to redistribute the tax rates across the city to ensure that all areas of the city are paying for the services they receive. It was also intended to be revenue neutral – meaning it would just redistribute the taxation levels in the city instead of bringing in more money to city coffers.

However, under this new plan, the city will collect an additional $3.4 million every year from urban taxpayers.

http://www.thespec.com/news/local/ar...y-gets-a-break

[flar]

I don't know what they're so proud of, this is a recipe for the same old same old, which is the suburbs leeching the rotting carcass of the old city.