6. PROPERTY TAX REBATES FOR REGISTERED CHARITIES AND TAX RELIEF FOR REGISTERED CANADIAN AMATEUR ATHLETIC ASSOCIATIONS

Transcription

1 6. PROPERTY TAX REBATES FOR REGISTERED CHARITIES AND TAX RELIEF FOR REGISTERED CANADIAN AMATEUR ATHLETIC ASSOCIATIONS COMMITTEE RECOMMENDATIONS AS AMENDED That Council approve: 1. the necessary changes to ensure that the Region s rebate program complies with Ontario Regulation 47/99; 2. the request to include Registered Canadian Amateur Athletic Associations under the charitable rebate program. DOCUMENTATION: 1. Finance Commissioner s report dated 17 May 99 is immediately attached. 2. Extract of Draft Corporate Services and Economic Development Committee Minute, 01 June 99, immediately follows the report and includes a record of the vote NEXT ITEM: page

2 1 REGION OF OTTAWA-CARLETON RÉGION D OTTAWA-CARLETON REPORT RAPPORT Our File/N/Réf. Your File/V/Réf. DATE 17 May 1999 TO/DEST. FROM/EXP. SUBJECT/OBJET Co-ordinator, Corporate Services and Economic Development Committee Finance Commissioner PROPERTY TAX REBATES FOR REGISTERED CHARITIES AND TAX RELIEF FOR REGISTERED CANADIAN AMATEUR ATHLETIC ASSOCIATIONS DEPARTMENTAL RECOMMENDATIONS That the Corporate Services and Economic Development Committee: 1. recommend Council approve the necessary changes to ensure that the Region s rebate program complies with Ontario Regulation 47/99; 2. consider, for recommendation to Council, the request to include Registered Canadian Amateur Athletic Associations under the charitable rebate program. PURPOSE The purpose of this report is to update Committee and Council on the changes to the mandatory rebate calculation for registered charities and to table the request from the Canadian 5 Pin Bowlers Association to consider a discretionary rebate program for Registered Canadian Amateur Athletic Associations (RCAAA s). BACKGROUND As required under The Small Business and Charities Protection Act, at the meeting of 12 August 98 Regional Council approved a property tax rebate for 40% of the total taxes payable by registered charities for the space they occupy in the commercial and industrial property class. Registered charities are defined under subsection 248(1) of the Federal Income Tax Act.

3 2 In December 1998, the Provincial Government passed The Fairness for Property Taxpayers Act, 1998, requiring municipalities to limit increases to no more than 10% in 1998, another 5% in 1999, and an additional 5% for Among other things, this legislation repealed the sections dealing with the formula for determining charitable rebate amounts, and the rebate payment due dates and replaced them with regulations that were released in February These regulations now require municipalities to provide a rebate for up to 40% of the property tax increase from 1997 taxes for the space occupied by registered charities in the commercial and industrial property class. In addition, these rebate payments must be made by April 30, 1999 for the 1998 rebate, by June 30, 1999 for the 1999 rebate, and by June 30, 2000 for the 2000 taxes. Subsection 248(1) of the Income Tax Act identifies two different specific types of organizations that are to be considered as registered charities; Registered Charities and Registered National Arts Service Organizations. The Act defines these organizations as follows: Registered Charity (a) a charitable organization, private foundation or public foundation, within the meanings assigned by subsection (1), that is resident in Canada and was either created or established in Canada; or (b) a branch, section, parish, congregation or other division of an organization or foundation described in paragraph (a), that is resident in Canada and was either created or established in Canada and that receives donations on its own behalf; that has applied to the Minister in prescribed form for registration and that is at that time registered as a charitable organization, private foundation or public foundation. Registered National Arts Service Organizations a national arts service organization that has been registered by the Minister under subsection 149.1(6.4), which registration has not been revoked Under the mandatory registered charities rebate program, both of these two types of organizations would be eligible for a tax rebate. This same section of the Income Tax Act identifies a third type of organization, Registered Canadian Amateur Athletic Associations (RCAAA's). RCAAA's, while considered to be charitable in nature under this federal legislation and able to provide receipts as charitable organizations, have been excluded from participating in the mandatory tax rebate program, as defined in the Small Business and Charities Protection Act. Organizations considered by the Minister under this category have been defined as follows:

4 3 Registered Canadian Amateur Athletic Associations (RCAAA) means an association that was created under any law in force in Canada, that is resident in Canada and that (a) is a person described in paragraph 149(1)(1) and (b) has, as its primary purpose and its primary function, the promotion of amateur athletics in Canada on a nation-wide basis, that has applied to the Minister in prescribed form for registration, that has been registered and whose registration has not been revoked under subsection 168(2) In addition to the attached correspondence from the Canadian 5 Pin Bowlers Association, the Finance Department has received a number of inquiries from representatives of various Registered Canadian Amateur Athletic Associations requesting to be provided with the same tax relief as registered charities. Under the legislation, Regional Council has been provided with the authority to provide discretionary rebates to organizations that are similar to eligible charities or a class of such organizations defined by the municipality. The report that Regional Council dealt with on 12 August 98, recommended: that a rebate program only be offered to eligible charitable organizations as defined in the mandatory provisions contained in the legislation. Any eligibility criteria that extends the program beyond this group of organizations would be open to interpretation and would result in a number of appeals from organizations that might see themselves being considered under any expanded definition. Should Committee and Council endorse a discretionary rebate program for RCAAA s, it would be possible to isolate these associations, given that Revenue Canada qualifies organizations under the Income Tax Act. Estimated Cost of extending the Program to RCAAA s At the time of registration, RCAAA s must consent to releasing information about their name and address before Revenue Canada will provide this information to the public. Revenue Canada has indicated that there are 120 RCAAA s across Canada, of which 110 have provided consent releasing their organizational information. Based on the information received from Revenue Canada, 49 of the 110 organizations in Canada are located in the Ottawa-Carleton Region occupy commercial or industrial property of which 44 of these organizations are located in the City of Gloucester at 1600 James Naismith Drive. Glenview Corporation, the company that manages the building, has estimated that 50% of the building is currently occupied by charitable organizations.

5 4 Based on this, the total cost of extending the rebate program to these 44 RCAAA s has been estimated to be $30,000 per year. As indicated under the legislation, the cost of the discretionary rebates are to be cost-shared with the Province, the local municipality, and the Region, based on the percentage of their total bill. The RMOC portion would amount to $11,700 per year. Approved by J.C. LeBelle Finance Commissioner

6

7 Extract of Draft Minute Corporate Services and Economic Development Committee 01 June 1999 PROPERTY TAX REBATES FOR REGISTERED CHARITIES AND TAX RELIEF FOR REGISTERED CANADIAN AMATEUR ATHLETIC ASSOCIATIONS - Finance Commissioner s report dated 17 May 99 J. LeBelle, Finance Commissioner, stated the additional estimated cost to the Region, should Committee support the request from the Registered Canadian Amateur Athletic Associations, was approximately $12,000 per year. He confirmed funds were available and could be accommodated through the provision for charitable rebates. Moved by A. Loney That the Corporate Services and Economic Development Committee: 1. recommend Council approve the necessary changes to ensure that the Region s rebate program complies with Ontario Regulation 47/99; 2. recommend Council approve the request to include Registered Canadian Amateur Athletic Associations under the charitable rebate program. CARRIED as amended (B. Hill and R. van den Ham dissented)