transfer payments 

The full impact of the provincial government’s recent decision to reduce transfer payments to municipalities will likely be seen when property owners receive their tax notices in the spring. For the Resort Municipality of Whistler, the province’s announcement means provincial grants and transfer payments have gone from more than $300,000 two years ago to $80,000 last year and just $29,000 this year. "In terms of our global budget it’s not huge, but it’s another cut," Councillor Nancy Wilhelm-Morden said. "The province keeps doing this and as the Union of B.C. Municipalities says, we can only raise taxes or cut services." Municipal Affairs Minister Jenny Kwan announced the new transfer payment schedule Dec. 18, a day after Finance Minister Joy MacPhail announced the provincial deficit is $300 million higher than anticipated, six months into the current fiscal year. Kwan announced a six-point plan for transfer payments that hits larger municipalities harder than smaller ones. The plan also includes a 50 per cent cost sharing program for sewer and water infrastructure projects, but that money won’t be available to municipalities until April 2000. The $29,000 Whistler will receive is actually a portion of the revenue the province receives from traffic fines levied in Whistler. That didn’t impress Wilhelm-Morden, who said the provincial government collects about $500,000 a year in traffic fines from Whistler. No one knows how much revenue Victoria collects from Whistler through the real estate transfer tax — Wilhelm-Morden estimated it was $6 million or $7 million. Estimates of Whistler’s overall contribution to the provincial economy range up to $2 billion. Kwan’s six point plan includes revamping the Municipal Act over the next two years and completing a study of local government financing, measures which may give municipalities more powers and additional revenue sources. However, Whistler is putting together its own case for tax reform. "This solidifies and strengthens our position to go to the province with a new proposal for a funding structure," Mayor Hugh O’Reilly said. "We want to be guinea pigs for a new system," O’Reilly added. "I’d rather not get any grants but have the province give us the tools," O’Reilly said. For Whistler, the reductions in transfer payments the last two years come at the same time the municipality has had to assume the full cost of its RCMP detachment. UBCM President John Ranta, mayor of Cache Creek, said in a release: "The level of hypocrisy has risen to new heights. The Premier scolds the federal government for the way they treat the province with respect to transfers and they gave him two year’s notice of their plans. But he slashes his transfers to local government just days before Christmas and a new municipal budget year." Ranta says provincial support to municipalities is about one-fifth of what it was two years ago, and at the same time Victoria has been downloading the cost of arterial highways, reducing access to utility taxes and consistently refusing to have their commercial Crown corporations pay taxes like any other taxpayer. BC Rail, for example, provides municipalities a grant in lieu of taxes, but the Crown corporation determines how much the grant will be and pays it at the end of the year, rather than in July when everyone else’s taxes are due. Whistler received $29,000 from BC Rail last year. Surrey Mayor Doug McCallum has vowed to levy taxes against provincial Crown Corporations and agencies operating in his city.

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