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Vacancy Tax Rebate Program Reform

The County of Essex and the municipalities of Kingsville, Leamington, Essex, Tecumseh, LaSalle, Lakeshore and Amherstburg are considering a change to the existing vacancy tax rebate program for commercial and industrial properties. Under the proposal, these changes would go into effect for 2018.

The intent of this change is to encourage the use of vacant properties to help support vibrant and sustainable communities.

Background

The Vacancy Rebate program was established in 2001 under section 364 of the Municipal Act. The program provides tax rebates to owners of vacant property in the commercial and industrial tax classes. The commercial class receives a 30 % rebate, while the industrial class receives a 35 % rebate if the property has remained vacant for a minimum of 90 consecutive days. Recent changes to the legislation now affords municipalities the opportunity to review and assess the merits and success of the program. It is the recommendation of the Essex County Municipalities to develop a work plan to consult with the public and to consider the elimination of the vacancy rebate program for 2018.

Total Value of Vacancy Rebates (2016)

Municipality

$10,580

The Town of Kingsville

$67,732

The Town of LaSalle

$48,549

The Municipality of Leamington

$24,799

The Town of Essex

$68,689 

The Town of Lakeshore

 $54,536

The Town of Amherstburg

$105,439

The Town of Tecumseh

Why would you eliminate this program?

The Vacancy Tax rebate program is being considered for elimination for the following reasons:

  • Vacant properties have a negative impact on neighbourhoods; funds recovered from the program could be re-invested in incentives for growth and development and could be better aligned with Community Improvement Plans.
  • Funds recovered would be invested in enhancing municipal services.
  • There is some concern that the program encourages a lack of property development and also discourages seasonal renting.
  • There is no guarantee (mechanism to ensure) that the tax savings from the rebate program is used to increase rental viability.
  • In many municipalities, the number of applications for the vacancy tax rebate has been declining in recent years.
  • The program requires significant administrative resources to administer the program effectively.

What are the next steps?

Essex County Municipalities welcomed feedback from the business community in regards to this proposed change. They held an open house on September 27, 2017 and invited the public to participate in an online survey, or provide comments via email. 

The data and feedback received is being analyzed for further consideration and will be shared with the public and the County and local councils in the coming weeks.

View a copy of the Open House Information Presentation.