County seeks feedback for tax incentive bylaw

By Erika Mathieu
Sunny South News

Lethbridge County is seeking community engagement with respect to a proposed Commercial and Industrial Municipal Tax Incentive Bylaw, Bylaw No. 22-008.

Bylaw 22-008 passed first reading during the April 21 Lethbridge County council meeting. If passed a second and third time, the bylaw would incentivize existing businesses hoping to expand, and attract new businesses by providing a temporary, four-year municipal tax exemption for new or upgraded businesses, as defined in the bylaw.

The purpose is to continue to attract new development and encourage the expansion of existing businesses, which falls in line with the County’s fourth pillar of the recently adopted 2022-2026 strategic plan. CAO Ann Mitchell said, “we understand we are a versatile region where all stakeholders are able to thrive,” and added, “Lethbridge County fosters an environment that will encourage investment in innovation and technology.”

Before council passes second and third readings, they are seeking input from the public before June 10. The survey consists of six questions, and once data is collected, the findings will be heard by council at the July 7, 2022 council meeting.

According to the recent meeting, “administration has been reviewing various commercial-industrial tax incentives policies in Alberta,” which informed the draft bylaw presented to council for consideration.

The County has examined the policies of several other municipalities in Alberta to get a sense of the scope and limitations of the policy within each municipality.

The Town of Viking requires eligible businesses to have a minimum value of $50,000 and applies to upgrading an existing development. The town of Okotoks adopted a bylaw which requires a minimum construction value of $2 million, and stipulates that upgrading existing developments are eligible but non-transferable if sold to the new owner. Wood Buffalo’s timeframe for their incentive is five years and is calculated through a formula of assessed value of development. Wheatland County offers a flat 40 per cent rebate, and upgrades to existing businesses are eligible. The City of Lethbridge offers a rebate equal to 25 per cent of the rate of the increase in municipal taxes, tiered over two, three, and five years depending on the value.

The County’s draft bylaw outline has proposed the following conditions:

New construction value or upgrading of existing development at a minimum of $50,000 assessment value increase would be eligible for the incentive. A reduction of the exemption may be applied to businesses if it is determined municipal infrastructure is required to make the new or renovated program feasible. According to the County’s website, “the tax incentive rebate would be as per the following table based on the assessment value post-construction, “and eligible projects would be eligible for 100 per cent deferral in the first year, followed by a 25 per cent reduction each year for four years.

Coun. John Kurbis said during the meeting, “this would be the savings for the rate-payer if they were doing this; this is not a situation where it’s actually costing the County money, it’s a situation where the County is just not collecting the full amount of taxes for the new construction for that period of time, so its an incentive to bring businesses in.”

To learn more about the specifics of the draft, or provide feedback on the proposed bylaw, prior to consideration for second and third reading, visit https://whatshappening.lethcounty.ca/proposed-tax-incentives.

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