Friday, October 24, 2014
Council hears PILT settlement review from City Staff
Seeking some background on how the City views the recent conclusion of the long running dispute regarding assessment of properties with the Prince Rupert Port Authority.
A process of some controversy in recent years, that makes up part of the Payment in Lieu of Taxes listings for the City's tax and revenue planning.
The topic has proven to be a contentious point of discussion between the two sides for a number of years now, as the City and Port disagreed on the value of the properties in question. The fallout from those disagreements has seen hundreds of thousands of dollars in flux for the City.
Earlier this year, Council made its Spring budget forecasts based on assessment values that in the end, have had to be reduced later in the process. A situation that has left the City to deal with budget issues through amended Financial plan motions reflecting those diminished numbers.
The latest review of the PILT arrangement came up as part of the Monday night proceedings and Council's discussions on an amendment to the most recent Five year plan from earlier this year. With the City's Financial Officer outlining some background on why the amendments to that plan were required, with increased costs for a number of items and a reduced revenue stream providing for the needed adjustments.
In regard to the PILT aspect of it all, City Manager Robert Long expanded on the recent news release of earlier this month and at the request of Councillor Thorkelson, provided a larger overview of the process, tracing back some of the history of the lengthy disagreement on how they reach the values on the properties in question.
He then outlined how the City came to its negotiated settlement for the first assessed values for the period of 2007 to 2012, though he stressed to Council that the City did not agree with the assessed values put forward by the Port Authority and how the Port did not agree with the BC Assessment valuations; with two sides then working through negotiations to come to their final numbers.
He also advised that there is a process in place for the years 2013, 2014 and 2015 where the City hopes the potential of increased conversation between the BC Assessment Authority and the Port might provide for an effective way to determine the PILT.
He offered up the theme of being generally satisfied at the recent outcome, with the City receiving substantially more than the Port had proposed, though he did acknowledge that the City did not get as much as they would have received through a BC Assessment evaluation.
Councillor Thorkelson then asked for a bit more background on the new process going forward.
Mr. Long advised that neither party had given up its individual rights from the years past, with the City retaining the option to use the Dispute Advisory Panel if required, while the Port can also, should it desire take the issue to an independent appraiser.
He reviewed how the City bills the Port on the BC Assessment Authority numbers, and how the City prepares the budget based on what it anticipates it will be receiving from the Port.
Admitting that it has been a bit disappointing that they have not received the amount that they have budgeted for, which has put the City behind the eight ball when it comes to revenues.
He outlined the nature of the billing process with the Port, based on the BC Assessment Authority valuation, with the City sending them a bill, and the Port then submitting what they believe they should pay, something which at this time, they have not done for 2013, 2014 or 2015
Mr. Long also observed how he's hoping to avoid another DAP process, so he's encouraging the Port to work with the BC Assessment Authority so get the right assessed value so they can pay on that basis.
Councillor Ashley asked for clarification as to what portion the City has received, she was advised that they have received a portion of what they billed for, though it will be some 500,000 dollars short of what they budgeted for.
Councillor Cunningham asked for what percentage the Port Authority has paid thus far, Ms. Bomben advised that for 2014 the Port has paid 70 percent at this time.
We'll leave it to the readers to determine from the ten minute review of the state of PILT, whether the City is taking a Victory lap on the issue, or just laying the groundwork for the nature of the discussions to come for the years to come.
You can start your review from the City's Video Archive the review on the issue comes up at the 1 hour 22 minute mark and continues through until the 1 hour 30 minute mark.
A full range of some of the past discussions between the City and Port can be found on our Port archive page.
For more items on discussions at Prince Rupert City Council see our Council archive page here.
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