Property taxes have risen at more than double the rate of inflation in the B.C. cities that are growing the most rapidly. Read More
Douglas Todd: In Langford, the second-fastest growing municipality in Canada, property taxes have jumped a staggering 38 per cent in three years. Tax hikes are almost as bad in New Westminster, Vancouver and Maple Ridge, etc.
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Douglas Todd: In Langford, the second-fastest growing municipality in Canada, property taxes have jumped a staggering 38 per cent in three years. Tax hikes are almost as bad in New Westminster, Vancouver and Maple Ridge, etc.
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Property taxes have risen at more than double the rate of inflation in the B.C. cities that are growing the most rapidly.
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In the Victoria suburb of Langford, which is the second-fastest growing municipality in Canada, property taxes have jumped a staggering 38 per cent in three years.
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In New Westminster, which recently became the second-densest city in the country, property taxes have skyrocketed 23 per cent over the same period.
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The B.C. cities of Vancouver, Maple Ridge, Nanaimo, and North Vancouver, and many others, which are all among the fastest-growing in Canada, have also been compelled to raise property taxes by 18 to 24 per cent in the past three years.
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Those tax hikes are well above the average rate of inflation of nine per cent in B.C. over the same period.
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While tax specialists say there isn’t always a direct correlation between rising populations and rising property taxes, these B.C. cities and many more contradict claims made by some politicians that property taxes inevitably go down as population density increases and infrastructure costs are spread among more property owners.
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The dramatic property tax jumps in these swelling cities link to the continuing debate about whether “growth should pay for growth.” That catchphrase captures the conventional idea that the developers who profit from building more apartments and towers should be the main providers of the money to pay for the expanded sewers, police, parks and social services needed to accommodate new residents.
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Taxes are complicated. And so are the implications of more people moving into cities. But one general trend that emerges from these numbers is that the developers erecting apartment blocks and other homes throughout B.C. are in many cases no longer covering the costs of providing infrastructure and services for newcomers.
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This places pressure on B.C. mayors and councillors to raise residential property taxes. And that makes them vulnerable to aggravated voters.
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The dynamic illustrates why civic politicians have traditionally striven so hard to woo new businesses to their municipalities, say University of B.C. housing specialists Tom Davidoff and Patrick Condon.
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“Generally, it is felt that adding residential homes does not pay for itself in new taxes, but new commercial and industrial development does,” said Condon, author of Broken City: Land Speculation, Inequality and Urban Crisis.
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Historically, North American cities have competed for new companies to move in because they will often pay hefty property taxes — but don’t usually come with new residents who need services, said Davidoff, director of UBC’s centre for urban economics.
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That’s not the case with new housing, especially in the form of condos, Davidoff said. New apartment units bring high density and many more people who need schools, bikes lanes and community centres.
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But condos don’t provide cities with as favourable a proportion of property taxes as do businesses — or even detached dwellings.
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“Replacing single-family dwellings with multi-family housing will very likely increase property taxes,” Davidoff said. “If you think ‘expenditure need’ — or how much government needs to spend per capita, for example on police and fire — then property taxes rise or fall with new housing, depending on whether the new homes are more or less expensive than the average property.”
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While in some instances populations can increase without increasing the costs of running a city, Davidoff said it’s clearly not always the case.
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One way to cover the extra costs of providing for more people, Davidoff said, is for cities to charge developers large fees in exchange for upzoning their properties.
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Developers, however, are attacking the “growth pays for growth” argument more than usual these days, since B.C.’s large housing market is going through one of its cyclical downturns, says David Ley, UBC professor emeritus and author of Housing Booms in Gateway Cities. “There’s a huge deficit in funding for growth, and even some lack of awareness in recognizing the need to do so.
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“The most notable case (of lack of awareness) is the unsustainable immigration growth by the federal government, without any sense of budgeting for infrastructure that must accompany it.”
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Ley points out that Burnaby Mayor Mike Hurley has spotlighted how rapid population growth is overwhelming city coffers. The Burnaby mayor is concerned that the B.C. government has mandated that, in the name of combating unaffordability, virtually every detached lot in the province be pre-zoned for four to six units each. It’s also requiring cities to OK massive apartment clusters around transit hubs. The trouble, said Hurley, is that every 100 metres of new multi-unit residential development will require municipalities to spend $1 million to upgrade water, electrical and other services.
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“The scale of Lower Mainland growth requires substantial public and private investment all over for everything from major transportation and sewer systems to parks and physicians,” said Ley. “And those multi-year costs are often subject to heavy overruns.”
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New West Coun. Daniel Fontaine laments “growth does not pay for growth” in his city, where dozens of new highrise towers are arising and the population has mushroomed by more than 30 per cent since 2014.
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“It’s costing taxpayers money, as the charges placed upon developers don’t cover all the infrastructure upgrades needed to manage growth,” said Fontaine, who was first elected in 2022.
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Fontaine says many B.C. city councils, including his, aren’t charging developers enough to cover the price of amenities, whether parks or pools.
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“We’ve seen property taxes skyrocket by 23 per cent over the past three years. And the forecast is for a 30 per cent increase during the term of this council (which ends in 2026). Yet our programs, services and public amenity infrastructure have not increased by 30 per cent,” he said. “You’d think that a city that has already done so much to densify would have been acknowledged by senior orders of government for our efforts — and that they would have kicked in some money to reduce the financial impact to local taxpayers. But that hasn’t been the case.”
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The lack of support from Ottawa and Victoria “should be a warning” to all other urban centres that embrace “the densification agenda,” said Fontaine.
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“The federal and provincial governments will applaud you for doing it, but they won’t be there to help fund it,” he said.
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