Council backs CAP alternative

By Heather Killen

Spectator

NovaNewsNow.com

The Town of Middleton has agreed to support an effort to can the CAP.

During the last meeting of the Committee of the Whole, councillors agreed to support a proposal for an alternative provincial policy that provides tax relief to low-income homeowners.

Jemma Lambert, town chief administrative officer, told council that representatives from the Union of Nova Scotia Municipalities (UNSM) and the Association of Municipal Administrators (AMA) have collaborated on a policy that could be used in place of the province’s current Cap Assessment Program (CAP).

The province introduced the CAP program in response to escalating market values of many shoreline properties. Drastic hikes in residential property tax rates were forcing out many longtime residents.

The CAP is designed to protect property owners from dramatic increases in market value by limiting or "capping" annual taxable assessment increases in eligible properties.

In the 2008-09 year, the percentage rate has been set at the Consumer Price Index.

The annual tax increases applied to eligible properties will remain set at the capped rate until the land is sold.

Lambert said that while this policy protects homeowners in the short term, it creates inequities over the long term.

“Over time, residents living in similar homes on the same street could be paying very different tax rates,” she said. “Each time the property changes hands, it uncaps the rate.”

The alternative proposal being brought forward by AMA and UNSM directly targets low-income homeowners.

Lambert said there are several income ceilings that provide tiers of tax relief and open the policy to a range of residents.

Because it offers smaller relief amounts to a wider base, it puts more money in the municipal coffers than the current CAP program.

“The point of this is to better target the remedy to benefit low-income residents,” she said. “Over the long term, the CAP program will be bad for municipalities and unfair to residents.”

Councillors agreed to write the UNSM in support of the implementation of the proposed tax relief program for low-income homeowners.

The town staff will also continue to review the town’s current tax relief policy and develop recommendations for council.