SUNDRE — Town council declined a request from a local business owner who was seeking a reduction – not an outright waiver – in their tax bill.
Even though the municipality did not increase its mill rate this year, the owner was nevertheless hit by an unexpectedly large tax bill after their property’s assessment increased substantially.
Hyeson Geum, owner of the Sundre Car Wash, presented her case during a regular council meeting last month.
“My concern is my 2022 property assessment and tax notice,” Geum said, adding she was surprised to see her tax bill had jumped from nearly $7,700 to a little more than $9,780.
“So, that’s a big change from last year to this year,” she said, asking whether this kind of situation is normal and whether council might be able to reduce the tax bill.
Mayor Richard Warnock asked if the tax bill went up as a result of an increased assessment on the value of her property, which Geum confirmed.
“Because council did not increase the mill rate for our taxes,” said Warnock.
Seeking further clarification from administration regarding council’s role in property assessments, the mayor turned to Chris Albert, director of corporate services.
“We do have an independent third party assessor that that does our assessments,” said Albert.
The typical process when a property owner has a concern about their assessment involves referring them to the assessor to initiate a discussion and ensure all of the information the assessor has is correct, he said.
“The assessor is the professional,” said Albert. “They can justify where those valuations come from.”
At that point, the owner can begin an appeal process if they do not agree with the assessor’s conclusion, he said.
“That is where the assessor actually has to justify the assessment,” he said, adding that with regards to this particular situation, Geum has had those discussions with the town’s assessor and agrees with the assessment.
“It is a huge increase in the amount, and the information that I have from the assessor is it is because the business was recently bought,” he said. “So, of course that becomes market value.”
Therefore the new market value is based on what the new owners paid for that property. Council has no authority to change the assessment, he said.
“That relies strictly with the assessor,” he said.
However, he added council does have the option to at its discretion waive or discount the property tax value.
Coun. Jaime Marr asked Geum if she was seeking a reduction of a specific amount, or simply consulting with council to consider what could be done.
“I don’t have an exact number,” said Geum. “I just want to reduce some amount until next year.”
Compounding factors from the pandemic fallout to inflation woes, with the impending Highway 27 overlay project expected to be underway in 2023, Geum was requesting a more incremental increase as opposed to a single sudden hike.
Coun. Chris Vardas pointed out the higher property value is also beneficial for the owner.
“Right,” said Geum. “I know my property’s increase is good news.”
However, sales haven’t been great, she said, adding “business circumstances are no good.”
So, her property’s value might have increased, but sales haven’t, she said.
“I don’t want to be harsh,” said Vardas. “But I think everybody’s in the same boat as you – everybody on Main Avenue is going through the same situation.”
That makes it hard for council to offer tax relief as it sets the stage to open the flood gates for similar requests, he said.
The councillor asked if she’d had a chance to speak with administration about a payment plan.
Albert said that conversation had not yet taken place, but added the owner would still face penalties even with a payment plan in place. He later reminded council that a decision could be made to waive that penalty.
Following further discussion, Coun. Owen Petersen eventually motioned that council not provide relief at this time.
Coun. Todd Dalke spoke against the motion and said exceptions can be made without setting precedent as each request would be considered case-by-case.
When someone buys a business, Dalke said they’ll look over the property’s tax history to have a better idea how much to budget into their financial plan. He suggested asking the owner to pay the past six months upfront and to split up the remaining six months throughout the rest of year.
Coun. Jaime Marr agreed, and also said she felt an exception could be made.
Coun. Connie Anderson also opposed the motion and said something should be worked out and to forgive any incurred penalties.
Albert clarified that Geum sought a reduced tax bill, not a payment plan to spread out the full amount owed. In the event council chooses not to forgive any portion of her 2022 tax bill, he said administration will work with the owner to try and find ways to alleviate some of the pressure.
The mayor spoke in favour of the motion, calling the situation a “tough one.”
“It’s not a punishment to the owner,” said Warnock. “It’s the economy.”
The mayor called a vote on the motion to not waive any amount of the tax bill, which narrowly carried by one vote, with Dalke, Marr and Anderson opposed.
