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Report To: General Government Committee
Date of Meeting: December 2, 2024 Report Number: FSD-050-24
Authored by: Jessica James, Manager of Taxation Services
Submitted By: Trevor Pinn, Deputy CAO/Treasurer, Finance and Technology
Reviewed By: Mary-Anne Dempster, CAO
By-law Number: Resolution Number:
File Number:
Report Subject: 2025 Interim Tax Levy
Recommendations:
1.That Report FSD-050-24, and any related delegations or communication items, be
received;
2.That the By-law attached to Report FSD-050-24, as Attachment 1, be approved; and
3.That all interested parties listed in Report FSD-050-24, and any delegations be
advised of Council’s decision.
Municipality of Clarington Page 2
Report FSD-050-24
Report Overview
The Municipality of Clarington levies interim taxes annually before the approval of the final
tax rates to ensure it can meet its financial obligations until the final tax levies are processed.
1. Background
1.1. The Municipal Act, 2001 authorizes a municipality, prior to the adoption of the estimates
for the year, to pass a by-law levying amounts on the assessment of property in the
local municipality for local municipal purposes.
1.2. Historically, the Municipality has passed an interim tax levy in December of the
preceding year to ensure that tax bills are processed in January of the taxation year.
1.3. Section 317(2) allows the by-law to be passed in November or December of the
preceding year (2024) provided the by-law does not come into force until a specified
date in the following year (2025).
1.4. Interim tax bills are divided into two installments: February 20, 2025, and April 17, 2025.
1.5. If Council did not pass the interim tax levy, taxes could not be collected until the final tax
bills were processed in the spring. This delay could result in a cash flow issue for the
Municipality and require taxpayers to pay their taxes in two instalments rather than the
current four (or more if they use pre-authorized payments).
2. Financial Considerations
2.1. An interim tax levy provides cash flow to the Municipality in the first half of the year until
the final taxes can be levied in June and September. This change reduces the risk of
using interim borrowing, which would incur interest costs.
2.2. Interim tax levies also allow taxpayers to spread the annual tax bill over four payments
throughout the year rather than all the taxes being due in the latter part of the year. The
payments could be further spread over twe lve months if the taxpayer signs up for pre-
authorized payments, which provides a constant flow of cash for the Municipality to
meet its financial obligations during the year.
2.3. Taxpayers can pay their taxes at any time prior to the due date, for example pa yment
could be made bi-weekly or monthly. Interest does not start getting charged until, and if,
there is an outstanding balance after a due date.
Municipality of Clarington Page 3
Report FSD-050-24
3. Strategic Plan
By collecting interim tax levies, the Municipality will be able to continue to be a leader in
the delivery of municipal services and continue to promote effective and long-term fiscal
management.
4. Climate Change
Not Applicable
5. Concurrence
Not Applicable.
6. Conclusion
It is respectfully recommended that Council approve the 2025 Interim Tax By-law to
ensure that interim tax bills are processed consistent with past timelines and to ensure
that tax revenues can be collected throughout the whole 2025 taxation year.
Staff Contact: Jessica James, CMRP(A), Manager, Taxation Services, 905-623-3379 x2609 or
jjames@clarington.net.
Attachments:
Attachment 1 – Draft by-law to levy interim taxes for 2025
Interested Parties:
There are no interested parties to be notified of Council's decision.
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Co-ordinator at 905-623-3379 ext. 2131
The Corporation of the Municipality of Clarington
By-law 2024-0XX
Being a by-law to authorize an Interim Tax levy for 2025.
Whereas the Council for the Municipality of Clarington deems it necessary to pass a
by-law to levy an Interim Rate for 2025 on the whole of the assessment for each
property class in the local municipality as provided for in Section 317 of the Municipal
Act, 2001 as amended;
And whereas Section 317 (2) of the Municipal Act, 2001 as amended, allows a by-law
to levy interim taxes to be passed in November or December of the previous year if it
provides that it does not come into force until a specified day in the following year.
Now therefore the Council of the Municipality of Clarington enacts as follows:
1.That the Council of the Corporation of the Municipality of Clarington is hereby
authorized to levy in 2025 on the whole of all taxable assessment on the property
according to the last revised assessment roll, a sum not to exceed that which
would be produced by applying the prescribed percentage (or 50 per cent if no
percentage is otherwise prescribed) of the total amounts billed to each property
for all purposes in the previous year on the properties that, in the current year,
are in the property class as provided for in Section 317 of the Municipal Act,
2001 as amended;
2. That for the purposes of calculating the total taxes for the previous year under
paragraph 1, if any taxes were levied for only part of the previous year because
assessment was added to the roll during the year, an amount shall be added
equal to the additional taxes that would have been levied if the taxes had been
levied for the entire year;
3.That the interim tax levy rates shall also apply to any property added to the
assessment roll after this by-law is enacted;
4.That all taxes levied under the authority of this By-law shall be payable in
Canadian funds and shall be divided into two equal instalments, the first of
said instalments to become due and payable on or before the 20th day of
February 2025 and the second of said instalments to become due and payable
on or before the 17th day of April 2025 and shall be paid to the Treasurer of
the Corporation of the Municipality of Clarington. Upon payment of any
applicable fee, and if paid on or before the due date imprinted on the bill, taxes
Attachment 1 to Report FSD-050-24
may also be paid at most chartered banks in the Province of Ontario;
5.That as Section 342(b) of the Municipal Act, 2001, as amended provides for
alternative instalments and due dates in the year for which the taxes are
imposed other than those established under clause (4) to allow taxpayers to
spread the payment of taxes more evenly over the year. A taxpayer may pay
taxes on a 12-month pre-authorized payment plan payable on the first day of
each month from December to November. In the event of the default of payment
on the pre-authorized payment plan, enrolment in the plan shall be terminated
and the interim tax levy shall be due and payable on the instalment dates as set
out is Section 4 of this by-law;
6. That as provided in Section 345 (2) of the Municipal Act, 2001, as amended if
the taxes or any instalment levied in accordance with this by-law remain unpaid
on the first day of the month following the instalment due dates set out in Section
4 of this by-law, a penalty of one and one quarter per cent (1.25%) will be
imposed on the amount for taxes due and unpaid; and
7.That as provided in Section 345(3) of the Municipal Act, 2001 as amended any
taxes levied pursuant to this by-law that are due and unpaid, interest at the rate
of one and one quarter per cent (1.25%) per month (15% per annum) of the
unpaid taxes shall be levied on the first day of each calendar month for so long
as the taxes remain unpaid.
8.That in accordance with the Municipal Act, 2001, Section 317(2) this by-law shall
be effective on January 1, 2025.
Passed in Open Council this XXth day of December 2024.
_____________________________________
Adrian Foster, Mayor
_____________________________________
June Gallagher, Municipal Clerk
Attachment 1 to Report FSD-050-24