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A taxing topic: councillors debate merits of area rating

Ending area rating in Greater Sudbury would mean a big tax hike for most residents outside the old City of Sudbury, but a tax cut for everyone else.
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Area rating is the tax policy in which residents without certain services – especially full-time firefighters – pay a lower property rate than residents with full services. It was implemented when communities in the former Region of Sudbury amalgamated at the turn of the century, in recognition of varying service levels across the new city. File photo.
Ending area rating in Greater Sudbury would mean a big tax hike for most residents outside the old City of Sudbury, but a tax cut for everyone else.

That was the message Tuesday at the finance and administration committee meeting, where a variety of taxing topics were discussed.

Area rating is the tax policy in which residents without certain services – especially full-time firefighters – pay a lower property rate than residents with full services. It was implemented when communities in the former Region of Sudbury amalgamated at the turn of the century, in recognition of varying service levels across the new city.

Ward 5 Coun. Bob Kirwan, whose ward include parts of the former Town of Valley East, asked if the cost of bringing services to some communities would be shared among all taxpayers, or just the residents receiving added services.

In response, Ed Stankiewicz, the city's manager of financial planning and budgeting, said under the current policy, it would be paid for by only the people receiving the new services.

“The full cost would be borne by the residents in that area?” Kirwan said. “I guess we have to be careful what we ask for … we're looking at some significant tax increases.”

If area rating was eliminated, Stankiewicz said, it would mean a tax cut for residents in the old city of more than $100 a year, while most other residents would pay about $74 more.

However, that doesn't include the cost of harmonizing services for all areas.

“If the services were identical throughout the city, there would be no need for area rating,” he said.

Ward 6 Coun. René Lapierre said since full-time firefighters respond to all emergency calls under “one city, one service” policy, who is paying the costs? Val Therese, which is part of Ward 6, is the only community outside of Sudbury with full-time firefighters.

“Some people are not paying for the service, but they are getting the service,” Lapierre said. “Who's picking up that tab?”

Trevor Bain, the chief of Fire and Paramedic Services, replied that there's no added costs to responding to those calls, since the firefighters are already working.

“So why do we bother having area rating?” Lapierre said. “I'm a little confused.”

“I'm not the expert on area rating,” Bain said. “So I can't speak to that at this time.”

However, he did say they are currently reviewing the firefighting situation in the city to see whether they can provide coverage for the city with full-time firefighters at the same staffing levels. The system currently in place was inherited during amalgamation, Bain said, and hasn't been updated.

It's possible that moving some stations and rationalizing some services could allow better coverage for the city at the same cost.

“Do we have stations located in the right areas to protect citizens and buildings in the right way?” Bain said. “If (some of the volunteer stations) were relocated, we could improve service.

“It is being evaluated now. We're at the beginning stages … It certainly requires further work.”

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Darren MacDonald

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