A survey commissioned by the City of Vancouver could bolster its mayor’s argument that a provincial bailout is needed to keep it from going into an operating deficit.
This week the city said that it could face a $189 million dollar deficit by December as it spends money to respond to the coronavirus crisis, while losing revenue at the same time.
It has asked for $200 million from the province and help with other measures to avoid going into an operating deficit, which municipalities are not allowed to do according to provincial laws.
On Sunday, Mayor Kennedy Stewart released the results of a small online survey that suggests 46 per cent of residents have either lost their jobs or experienced a reduction in work hours and lost some income due to the ongoing pandemic.
‘Backs against the wall’
Kennedy is worried that people will not be able to afford their mortgages or rents along with paying property tax. That could plunge the city into further financial difficulty.
“Our backs are against the wall here and it does look like if we don’t get some kind of relief from the province and the federal government, we’re going to be in deep trouble.”
The city has already laid off 1,500 workers. Stewart said more layoffs could follow and affect the city’s ability to run its police force, fire service and do things like collect garbage.
The survey said that 25 per cent of respondents plan to pay less than half their 2020 tax bills.
Stewart said if 25 per cent of homeowners default on their property taxes, it could cost the city another $325 million in revenues. He said if this happens the city would have to spend all of its reserve funds, plus sell city property to cover the shortfall.
“The City of Vancouver has never faced anything like this before,” he said.
So far the province has said no to the $200 million. Stewart is still asking for it though and wants the province to expand its provincial property tax deferment program to help homeowners who will otherwise default on their taxes due to the pandemic.
The program currently provides low-interest loans to people who are elderly or living with a disability, while giving money to municipalities to make up for the deferred property taxes.
Stewart said the program needs to include all residents, businesses and non-profit agencies struggling financially during the health crisis.
The city has also urged the province to delay remittance of non-city property tax items collected by city hall until taxpayers receive the payments themselves. The items include provincial school taxes, TransLink fees and Metro Vancouver fees.
Stewart hopes to hear from Housing Minister Selina Robinson this coming week about plans the province is mulling to help homeowners and municipalities alike.
The city’s online survey was conducted by Research Co. between April 9 and 10. Stewart said it cost between $4000 and $5000 and came out of his mayor’s office budget.
The results for employed residents are based on a sample of 421 Vancouver residents, with a margin of error of +/- 4.7 percent.
The results for homeowners are based on a sample of 278 Vancouver residents, with a margin of error of +/- 5.9 percent.
The results for renters are based on a sample of 301 Vancouver residents, with a margin of error of +/- 5.7 percent.