What is the price for taxation fairness in Oakland-Wawanesa? It’s $139,872.
That’s how much Oakland taxes will subsidize Wawanesa in 2019, unless this council ends a taxation imbalance that started with the 2015 amalgamation.
Chart 1a shows Oakland paying 86% of At Large taxes compared to Wawanesa, despite rural residents making up only 65% of the municipality’s population, as shown in Chart 1b.
At Large taxes pay for services shared by both rural and village residents, including fire protection, municipal staff and council expenses. Oakland pays 86% towards those costs, including remuneration for two Wawanesa ward councillors and the current head of council, who resides in Wawanesa.
Why the Imbalance?
Council funds shared services through At Large taxation, which is based upon property values.
With only 65% of the population, Oakland has 86% of the assessed property used to determine taxes. Wawanesa, with 35% of the municipality’s population, holds only 14% of that property.
Each year this imbalance is amplified because council classifies more services as ‘shared’, forcing Oakland to pay a higher and higher percentage of the municipality’s operating expenses. See Chart 2.
While both Oakland and Wawanesa enjoy 100% benefits from shared services, rural residents pay disproportionately more for those benefits.
A Fair Tax Solution
What’s the answer? Stop using property values for At Large taxation. Consider a flat rate on every roll number or a per capita tax.
As an example, At Large spending in 2019 for Government Services, Protective Services and Health Services is projected to be $666,005. This includes shared services like salaries for municipal staff, running the offices, paying council, fire services, grants to cemeteries and Handi Transit. As in previous years, rural will pay 86% to the village’s 14% through At Large taxation. See Chart 2a.
Instead, if council uses population rather than property values for At Large taxation, $139,872 will shift from Oakland to Wawanesa taxpayers. See Chart 2b.
Wawanesa may not appreciate more taxes but, with Oakland residents talking openly about dissolving the amalgamated municipality, the price could be significantly higher if a fair tax solution is not found.
Back to the Future
If $139,872 is redistributed as proposed, mill rates for both Oakland and Wawanesa would return to virtually the same levels as 2014, the last year before amalgamation. See Charts 3a and 3b.
Oakland’s combined mill rate (Oakland+At Large) would be 9.306, compared with the 2014 rate of 8.96. Wawanesa’s new mills (Wawanesa+At Large) would be 16.728, compared to its pre-amalgamation mill of 16.90.
This is what I have proposed to municipal council. It’s not the whole solution but it’s a start for real discussion about a fair tax solution.
Regards,
-Glen