Notes from the Port Hopers for Fair Taxes Presentation on Jan. 27, 2014 related to Municipality of Port Hope Council’s “Survey for Municipal Taxation Review”

Quick Overview: “Common” vs “Special”

The “Common” tag applies to services that are being delivered consistently in both Wards, in the same manner, and at the same level.

The “Special” tag applies to services where there is some difference between the Wards, where additional investigation and analysis of Ward-specific costs will be needed, in order to determine the fair share for each Ward.

What does “Common Service” Imply?

Categories/services tagged as “Common” will be charged to each Ward on the basis of “total weighted assessment” for all properties within the Ward (this essentially comes from MPAC).

On this basis, Ward 2 pays about 27% of the total cost of a category/service that is deemed to be Common. On the other hand, Ward 1 has 73% of the total weighted assessment and pays about 73% of the total cost.

How does 27% Compare to Historical Share?

For the five years prior to amalgamation, Ward 2’s share of the costs for all MPH services was 14.2%. For the subsequent decade, Ward 2’s share was 14.6% on average.

Choosing “common” for a category/service would have the effect of moving Ward 2’s share to 27%, or more than 75% higher than the share that Ward 2 ratepayers have paid.

Let’s Explore the “Common” Concept a Bit

Each category/service tagged as “Common” will have a tax rate assigned to it, and that one tax rate will be charged to each ratepayer, in both Wards, on the basis of the assessed value of their property.

Keep this in mind: “Common” means using the same tax rate for a service, in both Wards.

What does “Special Service” Imply?

Categories/services tagged as “Special” will need to be investigated more closely to determine the appropriate portion that is to be charged to each Ward, based on ward-specific data.

Ward 2 could end up paying less than 27%, or more than 27%, of the total cost of a Special category/service, all depending on the Ward-specific costs. Ward 1 pays the other portion.

Let’s Explore the “Special” Concept a Bit

Each category/service tagged as “Special” will (after further cost analysis and study) have two tax rates associated with it. Depending on the costs associated with delivering the Special Service to each Ward, a tax rate could be higher in one Ward and lower in the other.

“Special” means having two tax rates, one per Ward, reflecting costs of delivering a service to each Ward.

How to Decide #1: “Common” vs “Special”

Ask this question: “For Service X, is it:

a) being provided throughout MPH? or

b) undertaken generally throughout MPH? and

c) provided or undertaken at the same level throughout the Municipality? and

d) provided or undertaken in the same manner throughout the Municipality?

If “NO” to any of these, then tag it as “Special”.

continues …

How to Decide #2: “Common” vs “Special”

For another perspective, ask yourself this: “Is the $xxx,000 that MPH spends on Service X provided/undertaken at the same level, and in same manner, throughout the Municipality?

If your answer is “YES” then tag Service X as “Common”. If your answer is “NO” then tag it as “Special”, i.e., needing more cost analysis and investigation, as an area-ratable service.

How to Decide #3: “Common” vs “Special”

For another perspective, ask this question: “Considering Service X, for the level and type of service received in Ward 2, would it be fair to all for Ward 2 to pay 27% of the total cost?

If your answer is “YES” then tag Service X as “Common”. If your answer is “NO” then tag it as “Special”, i.e., needing more cost analysis and investigation, as an area-ratable service.

How to Decide #4: “Common” vs “Special”

For our friends in Ward 1, ask this question: “Considering Service X, for the level and type of service received by Ward 1, would it be fair to all for Ward 1 to pay 73% of the total cost?

If your answer is “YES” then tag Service X as “Common”. If your answer is “NO” then tag it as “Special”, i.e., needing more cost analysis and investigation, as an area-ratable service.

How Does “Area Rating” Fit into This?

Although the survey uses the term “special service” (in contrast to “common service”) a more-traditional term is “area rated service”, as part of an area-rating process or policy.

For area-rating, the different services or levels of service apply to different “areas” (which may be geographic). For MPH, the “areas” up for discussion are the two Wards: 1 and 2.

What if I Cannot Decide on “Common” vs “Special”, Based on Information Provided?

If there is insufficient information at hand, information that would be needed to allow you to make an informed decision about how to tag a category/service, then indicate this on your survey form. If the online survey program insists that you make a choice, then select “Special”. Indicate your reason in the comments that you provide (e.g., “there is not enough information to make an informed decision”).

Frequent Question

If I select the tag “Common”, or if I select the tag “Special”, am I asking to change the level of service? I’m generally “OK” with the services, and the current levels of service, that I receive. I just don’t want to see Council misinterpret the intent of my selections. A: We understand that Staff will gather results of the surveys, but we’re not sure what interpretations they might make.

What if Some Category/Service is Too Big?

If, in your opinion, a category/service in the survey is too big, too broad, too mixed, and/or too all-encompassing to make a decision, and if you are using the paper version of the form, then we guess that you might try writing your own “sub-categories” that meet your thoughts. This is just a guess, because the survey does not address this question.

What if Some Category/Service is Missing?

If, in your opinion, a category/service is not represented adequately in the survey, and if you are using the paper version of the survey, then then we guess that you might try adding your extra “sub-category” or service to match your thoughts. Q: Is GRCA in the survey? No, but we believe that it should be included as a category/service.

Prepared by Port Hopers For Fair Taxes

January 27, 2014