Tax base growth no windfall

There has been a lot of controversy over Canadian Horizons proposed development plans on The Naramata Bench.  One of the arguments continually made is that it will increase Penticton’s tax base.  Some people are under the impression that a larger tax base will solve many of Penticton’s problems as the new tax windfall pours in.  

This is a myth. 

The fact is the more Penticton spreads out and leapfrogs into agricultural territory the more it costs to maintain the ever-expanding infrastructure. 

Just ask Calgary as they are about to turn down 11 proposed developments on the outer perimeter of the city in an attempt to control demand and stop the rising tax burden.  “New neighbourhoods contributed to property tax increase of 0.75 per cent in 2019 and increases of 0.5 per cent per year to water utility rates between 2019 and 2022”.

Just ask Halifax who in 2015 did an exhaustive study and determined that “the cost of providing services and infrastructure maintenance to a home in a new suburb averages $3,462 per year, while servicing a home in an existing mature community costs less than half that, at $1,416.”

Just ask Winnipeg who’s population grew by 197,021 from 1971 to 2019.  A 37% increase while over the same period the city’s built-up area increased by 96%.  It also creates a divided city as the “haves” flee to the suburbs and the “have-nots” are left with a crumbling downtown.

Just ask Edmonton who found that the long-term servicing and infrastructure costs for 17 proposed edge communities will exceed their return in tax revenues by $4 billion over the next 50 years.

For those of you who think more people = more taxes = less crime just ask Vancouver.  If that myth were true then Vancouver would be the safest, crime free city in BC . 

The developer would also have you believe that more homes = more affordable homes.  Another myth. Just ask Toronto where the average house price in the Greater Toronto Area in August 2020 hit a record $943,710 after building 27,294 new homes over the previous 8 months. 

My point is that enlarging your tax base is not the answer to these complex problems and only accomplishes one thing.  It turns your small city with small city problems into a big city with big city problems.   


John Bilodeau

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