ASK Salt Spring: Answered - Ep 31 Gary Holman

Episode Date: February 9, 2024

Gary Holman, CRD director for Salt Spring and a member of the Local Community Commission, talks about tax hikes and new funding for housing.

This is episode 31 of Ask Salt Spring Answered with me, Damian Inwood, and we're talking to CRD Director Gary Holman again about regional taxes increases and that kind of thing and also about some housing good news that we've just got in the last few days. Yeah I'm sitting here with Gary Holman who is the CRD director and a member of the local community commission and we've just been at the Ask Salts Salt Springs session where the local community commissioners were all present to answer questions from people and one of the things that came up was the budget and the fact that the LCC has now finalized its budget and is looking forward to going on to other things but

one question that was asked was what was the results of the budget negotiations and what are we looking at in terms of an increase in a possible tax situation? And Gary, maybe you can just fill me in on, Earl Rook had a fairly extensive response to that question, but obviously you can answer it too. Yeah, thanks, Damien, for asking the question at the meeting. So still some issues resolved. The CRD board approves the final budget both for LCC services and regional services at a meeting in March. So there's still some outstanding issues that need

to be resolved. But the way it's looking now, the LCC has worked hard to reduce the staff proposed requisition increase of 20% down to a little over 10%. And for CRDA as a whole, including LCC local services and regional services, right now it's looking like something in the order of 7%. And, again, the overall requisition increase proposed in our provisional budget, which was approved last fall, and then the board approves the final budget in March, the overall requisition has gone from about 9.5%, 10% down to in the ballpark of 7% for CRD as a whole. Is there any way you can tell us roughly per household what that would come to, or does it depend on the value of your property, I guess? Oh, yeah. I think it's in the ballpark of $90 to $95 per household per month. So you work at like it's around $1,000 a year, I believe,

for the so-called average residence, for the average property value, which is in the order of, again, that's assessed values for Salt Spring are one of those things that have to be finalized before the March meeting, but the average household on Salt Spring is around $1.1 million. So for that average property, that average property will pay in the ballpark of about a thousand dollars a year ninety ninety five dollars so that means that the increase has gone up about a hundred dollars and probably if it's a ten percent increase is that right well that's just for LCC services. For series of holds, about 7%.

So it would be a little bit less than that. Yeah, okay. But, yeah, when you consider – and some people, all right, compare it to my utility bill, like for your internet and phone and cable, et cetera, et cetera, right? that the CRD provides, from parks and rec to dealing with our liquid waste to public transit to transportation and the pathways we're building. And regionally, for example, one of the single biggest requisitions regionally is the hospital facilities function. That service alone is something in the order, anyway, it's a significant portion of the budget. But then you think about the fact that our new emergency room received $3.7 million from that service. So it's not just about taxation.

It's about the services, the facilities, the amenities that that taxation supports. One example, we're sitting in a modular here that houses the radio group. That's part of the middle school lease that the CRD took on from the school district. 25,000 square feet, that includes the gym, that is costing taxpayers about $250,000 a year. If you look at the value of the asset that we've secured, and we are negotiating a longer term tenure. If you look at the value of that asset, like to build this facility new would be tens of millions of dollars. Well, we've leased it for $250,000 a year. That's just one example of a service provided by CRD. And actually, it was one of the items that resulted in a tax increase

because it turns out that when you're using the middle school more frequently, like longer period during the day and on weekends, you're actually having to heat the building for longer. So those heating costs were higher than we anticipated. So that was one of the costs that went up and was part of that tax increase. The other major factors are negotiated wage and salaries, which is tied to inflation, which has recently been quite high. The negotiated wages and salaries for CRD staff, some are in the order of four to five percent. Well, that is reflected in all of the services. We don't really have

control of that. The other issue is COVID. There's still some lingering impacts from COVID for services that rely on revenue for part of the dollars that help fund the service. So public transit, for example, during the height of COVID, 24-seat buses were restricted to six passengers. And ridership is now coming back, but there was a huge hit on transit revenues, and therefore, just to maintain the level of service, we had to increase the requisition to cover that off. Parks and Rec as well, the swimming pool, other parks and rec services, to some extent, are funded by fees. And again, COVID really hammered those services. So again,

the deficits that we incurred get carried over, and we have to deal with them in 2024. Again, pretty much beyond our control. Some factors are within our control, but a number not. Right. So how did the LCC do, do you think, in terms of the budget talks? I mean, it's the first chance at doing this. And when you get five people in a room, obviously, they all have different opinions. But was it a very long, drawn-out process? Did they, how, you know, as a more seasoned politician yourself,

how do you see the process working? Was it good it was particularly a particularly difficult budget year for a brand new elected body uh to uh come to an understanding of the various services that crd provides many of which in particular parks and rec very complicated budgets so had to at the same time try to understand those services and the need for tax support, and at the same time faced with a very daunting requisition proposal from staff and having to deal with it in a very short time. Given all that, I think the LCC has really performed well. And the LCC, and it wasn't unanimous by any means, but that's democracy, right?

People have differences of opinion. Before, it was just the single elected director. For example, myself, ultimately deciding on local requisitions. Well, now it's a decision made by five people, including the director. The original staff proposal for LCC services was in the order of 20 percent, the requisition increase. The LCC, through like our last meeting, to finalize our budget for local services was a nine-hour meeting, but a meeting held in public. Anybody could come to the meeting. You could make presentations, delegations. So it was a

difficult process, but we took that 20% increase in requisition for LC3 services down to about 10%. So, and had to make some very difficult decisions in doing that. But, yeah, overall, especially the first year, you know, there's a real steep learning curve. Next year, you know, we've gone through the process. It should proceed more smoothly, and I think we've got through some of these kind of factors beyond our control that we've now dealt with, more or less. So next year should be an easier process. In my view, the LCC has done an admirable job of doing their very best to maintain the level of services and keep the tax requisition as low as possible.

Many communities in British Columbia, including municipalities in the CRD, if you look at the requisition increases that they're proposing and facing, it's 9, 10. It's not uncommon in these days for local governments to have requisition increases in the order of 10%. Yeah. So it's working, basically. In my view. As a new government system.

In my view, yes. In your view. Okay. Now, you came up with, you had some good news on a couple of things. You talked about the $85 million, which is going into a regional housing program, right? And you hope that some of it will come to Salt Spring. Do we have any actual idea how much we might get at this point? It'll depend on the quality of the proposals we put forward.

But based on previous experience with regional housing funding, we've been reasonably successful. And actually, a regional housing staffer came to the LCC to provide an overview of regional housing programs and the historical experience. And that experience shows that the dollars that Salt Spring has received from regional housing services to which we contribute, Salt Spring has received

a much higher amount in terms of dollars being invested here versus dollars we've spent. So historically, and in large part because of very capable NGOs like Community Services, like IWAVE, we've been pretty successful in accessing regional funding and senior government funding. So there are several projects underway right now that could be applying to regional funding, which, by the way, regional district hopes to have that funding matched by senior governments.

So the $85 million is the amount of dollars that the CRD is raising. The AAP, the so-called counter-petition process, looks like that initiative failed, which means that the borrowing initiative succeeds. So it looks like the $85 million in effect has been approved by voters. We're hoping to have that matched and more than matched by senior governments, which is what happened with the previous regional housing program. It was a three-way partnership. CRD, $40 million. BC Housing, $40 million. CMHC, $40 million.

We're hoping to get similar, if not more, matching for this program. But, yeah, Salt Spring has been pretty successful in getting those dollars invested on Salt Spring. The Crofton Brook, the I-Wave Crofton Brook project, 54 units was the most recent example of that. Crofton Brook received between $6 and $7 million from regional housing funding. So there's an example. Bottom line, though, it comes down to putting forward proposals that have merit and rank well.

So I'm hopeful and expect there will be such proposals coming from Seltzer. In fact, there is a couple on the boiler right now that will be applying for regional funding. So when would we know, do you think? How long does it take before we find out? Whether dollars are being invested here? It's kind of how long is a piece of string. It depends on how quickly those...

I know there's already been a proposal made to BC Housing and to CRD that's already in the works. So I would expect over the next year or so, we're going to be hearing about proposals and possible funding. But, yeah, basically the timing will depend on the timing of proponents coming forward with viable proposals. Now, you mentioned something about the South Gulf Islands Tourism Group. I'm not sure if that's exactly the right title for them, but district I think it's called, which is going to be putting money into workforce housing in the

future. Can you tell me a little about that? Yeah, that's very good news. So it's a society that was formed, the Southern Gulf Islands Tourism Partnership, to receive the so-called hotel tax. The technical name is the Municipal Regional District Tax. And so it's a 2% tax on visitor accommodation. And there are kind of two components of that. One is the so-called online. So like Airbnb would be an example.

If you make a reservation through Airbnb, that's called the online MRDT. And in total, and the other is you just come to Salt Spring and you rent a hotel room, like directly at the desk kind of thing. The online portion of the MRDT for the Southern Gulf Islands electoral area and Salt Spring is in the order of $650,000 to $700,000 a year. Roughly half of that online revenue, which is in the order of $300,000, $350,000, to workforce housing, which would apply in the two electoral areas where the tax is levied. And they've also committed to $100,000 a year to the CRD Rural Housing Program, which is going to be considered by the board next week, to hire a coordinator for that program. They're funding Housing Now, which is a tenant-landlord matching service, which up to recently was just applied on the Southern Gulf Islands electoral area, but which will soon be applied here on Salisbury. There's also a housing reserve that they set aside, and they'll be contributing more dollars to that.

So that housing reserve could be used for pre-development planning. So the due diligence that a non-profit proponent, say they own a piece of property, but they need to do feasibility, they need to cost out services, they need to do funding proposals. So that so-called PDF funding is really helpful in supporting non-profit proponents to put together a proposal to then apply to the regional district or BC Housing or whatever. So all of those aspects the tourism partnership has agreed to. Local government has to approve. They've been in place for five years.

They're renewing that agreement for another five years in September. They need local government, i.e. CRD support to do that. And leading up to, and CRD will be supporting it, but leading up to it has been discussions, particularly by the LCC and the Tourism Partnership about, well, if we support this, what we'd like in return is a commitment around investments you're going to be making on affordable housing. They have done that.

So the board will be, I believe, approving the renewal of the five-year agreement February 14th. But the other group that has to agree to the tax, of course, are the accommodation providers themselves. So 50% of the accommodation providers, and actually it comes down to the number of rooms, 50% of the number of rooms, because you've got big accommodation facilities and B&Bs. So 50% of the major accommodation providers, and measured in terms of number of units, have to agree also to the renewal because we're essentially taxing their clients. They have to agree. Local government has to agree. And the good news is that we've come together and agreed on a certain proportion of their revenue to be dedicated to workforce housing.

It's very good news. Okay, great. Well, thanks for coming in, Gary. And hopefully we'll have more good news in the future. Thanks, Damien. You've been listening to Ask Salt Spring Answered on Gulf Islands Radio, cheer.fm. And we'll talk to you next week.