City politicians are pushing for a quick end to London’s vacancy rebate.
The corporate services committee voted 4-1 on Tuesday to end the 30 per cent property tax rebate for empty buildings in one year.
Mayor Matt Brown, Ward 4 Coun. Jesse Helmer, Ward 7 Coun. Josh Morgan and Ward 13 Coun. Tanya Park vote in favour of the quick goodbye, Deputy Mayor Paul Hubert voted against it.
If approved by full city council next week, the rebate will drop to 15 per cent in 2018 and zero in 2019.
Hubert voted against the move based on the timing, arguing city hall was giving property owners a short period of time to adjust.
“The goal of a program like this would be to increase occupancy and to increase equity and I don’t see that it’s working in any way,” said Mayor Brown.
The issue wasn’t whether the committee should end the rebate, but how fast. Earlier this year city council decided to end the tax rebate that applied to owners whose buildings have been empty for more than three months.
City politicians could have chosen an even faster draw down, one option presented by staff would have seen the rebate end Dec. 31, 2017.
The move will save London $900,000 next year and $1.8 million in 2019.
“Any company that’s coming to town or is already in town should be developing a more just-in-time model for building out buildings, making sure they have tenants in place. I don’t see why taxpayers of the city of London should be subsidizing their business growth,” said Park.
Phasing out the rebate was supported by all of the BIA’s in London, but not the London Chamber of Commerce.
“It’s not incenting occupancy, it was started to incent occupancy, it’s not doing that,” said Janette MacDonald, head of Downtown London.
MacDonald added they would support the creation of a similar fund to incent occupancy to preserve heritage buildings.
The chamber of commerce called for a longer phase out period, pushing for one between 3-5 years long. In a letter sent to the committee, the chamber argued London would hurt its competitive advantage if the rebate were to be rolled back.
However, the committee heard a number of other municipalities across the province are in the process of evaluating similar rebates, with some choosing to eliminate them.
Hamilton will eliminate its rebate by 2019 while Peel Region will reduce its rebate to 10 per cent by 2019. Toronto and Ottawa will end their rebate programs in 2018 while Oxford County has already scrapped their rebate program. Chatham-Kent is currently in the process of phasing out their rebate program.
It’s unlikely the money saved by London ending the rebate program in 2019 will go to general revenues, the committee also recommended staff report back with options to reinvest the money with the aim to encourage economic growth and development.