Kamloops City Council is about to add a new 10-year tax exemption for purpose-built rental properties – Kamloops News

Kamloops City Council is close to approving a new revitalization property tax exemption to encourage the construction of new rental housing in core areas of the city.

The 10-year exemption would apply to buildings with ten or more rental units, with the City Council giving the first three readings of the bylaw at its Oct. 22 meeting by an 8-1 vote, with only Mayor Reid Hamer-Jackson was against. The city council will adopt the ordinance on Tuesday.

The exemption applies to all of North Kamloops, downtown, southwestern Kamloops and the central Westsyde and Valleyview areas.

The bylaw exemption applies to areas near Kamloops’ three transit hubs – Lansdowne, the North Shore and Thompson Rivers University and areas where higher-density housing development is supported with lower parking requirements and a higher degree of walkability, according to a staff report to the council.

The purpose of the ordinance is to increase housing supply, stimulate and encourage new private investment in rental properties and encourage higher-density housing construction, the report said.

It is also a recommendation of the city’s Housing Accelerator Fund action plan, which was approved by the City Council last September.

Count. Kelly Hall pointed out at the Oct. 22 meeting that this move makes long-term sense, as the city would begin collecting the deferred taxes once the exemption period expires.

“There is a huge opportunity for taxation within the community,” Hall said.

The tax exemption applies to 100 percent of the increased assessed value of improvements that create purpose-built rental housing.

The City will continue to collect tax revenues from the land and the increase in the assessed value of the units during the exemption period, as the exemption only applies to the increase in the assessed value of the improvements during the construction of a building.

Tax revenues from the land and units will increase due to rising assessed values ​​and any applicable incremental increases in property tax rates over time, the city report said.

A tax exemption certificate issued under the Articles of Incorporation does not exempt the owner from applicable local service taxes.

Marvin Kwiatkowski, director of development, engineering and sustainability services for the city of Kamloops, told council during the meeting that the city is currently seeing many potential projects “in the queue,” but not many additional rental units are coming onto the market.

Hamer-Jackson said he thinks it’s a “tough economic time” with high interest rates, and he wasn’t sure the tax incentive would do much to spur development. He said he believes the city should better promote its tax-exempt areas to the public and limit the focus on incentives for the few developments that are ready to hit the market.

The city also has revitalization tax exemption statutes to encourage commercial and residential development downtown and on the North Shore, redevelop existing hotel or motel sites and build new day care centers.

The new tax exemption only applies to purpose-built rental properties insured through a housing agreement, and applies to both provincial and municipal taxes.

The new bylaws do not apply to strata-titled units or to commercial or institutional space.