Friday, May 29, 2009

2009 Final Tax Rates & Property Assessments

You may recall that in January, I wrote here about how Market Value Assessment was only one half of the property tax equation. I explained then that the amount of property tax you pay to the Town of Pelham, to the Region, and to the Province (for Education) is based on the Market Value Assessment of your property multiplied by the tax rates.

Further, I suggested that you “stay tuned” until all three entities set their final tax rates.

Well, during our regular meeting last week, Council approved the 2009 Final Tax Rates. Despite Pelham Council approving our budget in February, we were not able to adopt these final rates until now – that is until after the Niagara Region and the Ontario Ministry of Education set their final rates.

Your Assessment:
Your assessment is solely set by MPAC. The Town and the Region cannot change any element of this assessment. It is mandated by the Province, who has established a separate corporation – MPAC – to administer it.

In Pelham, the average residential property increased by 5.78%. Does that mean that your taxes went up by that amount? No. Because your property tax depends on both your assessment and the tax rate.

Property Taxes = Assessment X Total Tax Rate

Tax Rate:
Your tax rate is set by the Town, the Region, and the Province (for the Education portion). Here are the final rates for 2009.

Municipalities set the tax rate based on the total assessment for each of the tax classes – residential, multi-residential, commercial, industrial, farm/managed forest, pipelines.

So what happened to your assessment and your tax rate?
The average residential property in Pelham had a market value assessment of $235,000 for the 2008 tax year. For the 2009 tax year, that increased by 5.78% to an average of $248,583.

At the same time, the Pelham tax rate decreased by 3.9%. Therefore, the Pelham portion of your residential property taxes increased by 1.7%.

When homeowners received their property reassessments in the fall, some worried that Pelham might take advantage of the increased assessment to hike property taxes. Instead, quite the opposite occurred.

I hope you will be pleased to know that the final property tax increase of 1.7% is the second lowest increase in Niagara Region this year!