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The features for this Program would be as follows:
Eligibility includes all permanent resident homeowners. I read that the increased homeowner grants would affect 2,500 residents. If we have a population of 10,000 (last census I think was about 7,500), that suggests one in four residents own their own home, which seems high. I will use a sample of 2,000 applicants to assess the impact. This considers that seniors over 60 have their own programs, employee housing has a much smaller load to bear, and not everyone will take advantage of the program.
Average school tax amount for deferral is estimated at $2,000. Applicants will have to show minimum equity in their homes of 25 per cent of assessed value after deducting registered mortgages and other charges.
All applicants will have a Tax Account. They may not choose to defer every year. The Account can be paid down in whole or part any time with no penalty.
In the first year the overall amount would be 2,000 applicants x $2,000 = $4 million. This Pool can be financed by the local bank/credit union with the municipal guarantee and an assignment of the Tax Account charge on the home title.
The interest rate charged on Whistler's Millennium Place is Prime less 1 per cent or at present 4 per cent. At 4 per cent the average applicant plays $80 for this year instead of $2,000 in school taxes.
If the average home is owned for 10 years, the Pool might grow to $4 million x 10 years or $40 million. This is actually high, as it assumes no homes are sold during the 10 year period and new owners may or may not apply for the program.
If the average home were owned for 20 years, the Pool would be $80 million. Whistler's financial position is over $200 million, so the Pool is not out of scale with Whistler's capacity.
The average taxpayer would pay therefore an annual interest fee of $80 in year 1, or $800 in year 10 (Tax Account of 10 x $2,000 = $20,000). If interest rates rise to 10 per cent, the bill would be $2,000 in year 10, or equal to what's deferred. But this kind of theoretical problem can be handled creatively by the RMOW as the Pool grows with longer term fixed financing on parts of the Pool. At some level, some or all interest can be capitalized and deferred.
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