Saanich might find it difficult to implement a ‘public benefits test’ for religious institutions that currently receive permissive tax exemptions.
This finding appears in a staff report that Saanich council will consider tomorrow after it had asked staff to review Saanich’s policy around permissive tax exemptions.
“A public benefits test for places of worship would be more challenging to implement as all such exemptions are currently established on a perpetual basis,” said Valla Tinney, Saanich’s director of finance, in the report. “Any implementation would be on a go forward basis or [council] would need to consider rescinding previously approved exemptions.”
The question of Saanich’s permissive exemptions entered public discourse last year after a provincial organization promoting secular humanism questioned why B.C. communities, including Saanich, continue to grant tax exemptions to properties that religious groups own.
Under existing legislation, Saanich may exempt from taxation any area of land surrounding buildings set apart for public worship. Once granted, the exemption is perpetual until properties changes ownership or are no longer used for their original purpose, the report notes. (Buildings used for public worship including improvements and the land underneath them are exempt from taxation under existing legislation).
According to the report, 46 Saanich churches have previously received permissive tax exemptions for the land surrounding their buildings. These permissive tax exemptions totaled $561,186 in 2018. By way of background, this figure represents about a third of the total value of tax exemptions granted in 2018, as Saanich granted non-religious institutions about $1.06 million in tax exemptions.
Saanich issues permissive tax exemptions to eligible organizations (excluding churches) on a four-year-cycle.
Staff, according to the report, will review exemption applications in the summer 2019. All exemptions that still meet the exemption criteria will be incorporated into the next four-year bylaw (2020 to 2023) for council’s consideration.
The report notes that council can choose among two options if it wants to receive more information before granting exemptions: an “enhanced application form” and a public benefits test, which would require Saanich to create a new permissive tax exemption policy. Such a move could impact staff resources, and would require a one-year permissive exemption under the existing criteria to create and consider a new policy to be in place by 2021 and forward, the report notes.
Overall, the report recommends council receive the report. As such, it can be read as endorsement of the status quo.
The current permissive tax exemption policy and processes allow council to review permissive exemption requests on “their merits and in context with the Saanich Strategic Plan” on a four-year-basis. “The current process provides financial stability for the exemption recipients and the District and reduces administrative burden and advertising costs,” it reads. “Council has an option to add further scrutiny to the approval process with the addition of a formal public benefits review.”