The City of Kamloops will look at allowing more housing types to qualify for its downtown-revitalization tax breaks, but CAO David Trawin is warning that the program’s cost is already high enough to give some on council sticker shock.
Council agreed to look at loosening its restrictions after a request from the Kamloops United Church, which wants the 10-year tax-exempt status for its project at 429 St. Paul Street.
Mayor Peter Milobar did not take part in the discussion because several members of his family are closely involved in the church’s effort.
DOWNTOWN EXEMPTIONS
HOW THEY WORK: Right now, new buildings in the downtown core are eligible for 10 years of tax exemption if they are hotels, motels or public-parking structures, or if they contain at least 50 per cent residential rental units. Upgrades to existing buildings also qualify if the city believes they improve the appearance of the downtown and meet a cost threshold. The Kamloops United Church’s residential project at 429 St. Paul St. does not qualify under thecurrent bylaw.
The project is an affordable-purchase model, targeting buyers who may have money for monthly mortgage payments but cannot afford a 10 per cent down payment.
Instead, the church will provide the down payment, which must be paid back interest free when the units are resold.
Project spokeswoman Maryann Milobar said the tax exemption would make the units even more attainable for lower-income buyers.
“It wouldn’t be an asset to the church, but it certainly would be to people that were purchasing the units,” said Milobar.
“It might qualify some people at a bank that wouldn’t otherwise be able to afford their first mortgage.”
Under the current bylaw, the tax break can only go to new buildings that will become hotels, motels, public parking structures or contain 50 per cent rental units.
Coun. Marg Spina said she’d be willing to consider a tax break if the church agreed to provide some rental housing in perpetuity, but didn’t want to see the exemption opened up otherwise.
Coun. Pat Wallace said she doesn’t want to set new precedents for tax breaks or give the church a deal council hasn’t given other developers.
The church also asked for a break on development-cost charges for the project, which council declined to consider.
Council will review the tax exemption criteria further at a workshop session in May.
At that time, Trawin said city staff will also have added up just what the city’s current exemptions are costing each year.
“Those revitalization numbers are starting to add up in the chequebook and I think council might be a little bit surprised at what those numbers are,” he said.
Trawin wouldn’t comment on how much the city is giving up in tax revenue each year, but pointed out the $25-million Sandman Signature Hotel on Lorne Street is one property covered by the exemption.
By May, construction could be underway on St. Paul Street as well.
Milobar said the church hopes to meet its pre-sale requirements in time for an April construction start.
