The Village of Cumberland recently discussed deferment options both for property taxes and utilities. File photo, Comox Valley Record

Cumberland council opts for deferment on utility bills

Council also considered options for property taxes but maintained the July deadline

Cumberland has offered some relief for homeowners in terms of deferring payments for utilities.

Council tackled the question at its first meeting, which was being held via Internet video in order to comply with physical/social distancing standards in response to COVID-19.

RELATED STORY: Cumberland holds its first live-stream meeting

Staff presented council with a bylaw to pass utility rates with deferred payment options that could offer some relief to people affected by the economic fallout from the pandemic. During financial plan discussions last fall, the Village budgeted for a 4.62 per cent increase to property taxes and a 1.96 per cent increase to utility rates, as well as an increase to frontage taxes.

RELATED STORY: Cumberland council plans for tax, utility increases

Staff outlined a few different options, along with the potential advantages as well as potential disadvantages such as increased staff time, disruptions to cash flows or work flows, a need to rely on a line of credit, incurred interest and reduction in interest accruing on municipal government finances.

Because of the timeline and the economic situation, council has the ability to enact all three readings and adopt the bylaw at one meeting. Council members felt offering a deferment for late payment utility penalties was one area it could offer some relief to residents. Currently, the due date is 30 days from each billing date, and the next bills are due to go out mid-April.

The three proposed options were to defer due dates for both mid-May and mid-August to September, to defer only the May deadline to July, or to stagger the due dates for May until July and for August until September.

Council passed the bylaw to send out notices but postpone the due date deadline for the first two quarters until Sept. 14 to give residents some additional flexibility. A 10 per cent penalty would not be imposed until that time.

Property taxes

Council also considered a staff report on options around property taxes, which are due July 2. If council was going to change the deadline for property taxes, chief financial officer Michelle Mason recommended only doing it for this year.

Each year, council collects not only its own revenue but on behalf other agencies – notably, the school tax and the regional district – by the deadline in July. This makes up about 51 per cent of the total taxes collected every year, and the Village will still be responsible for that portion, even if it chooses to defer taxes.

“Just over half of that, we have to pay out, regardless of whether we get paid for it,” Mason told council.

The Village must pay this shortly after its own July 2 deadline for residents to pay property taxes.

One consideration of council was whether the Province will provide some type of deferment program regarding property taxes.

“At this point, we have not heard anything from them,” Mason said.

Mayor Leslie Baird said from a teleconference between mayors and the Province, there was an indication of some kind of announcement on this issue is pending.

“They’re requesting the municipalities hold off on any decision,” she said.

Council would need to adopt changes by May 15. The plan for staff is to take direction from council to prepare the tax rates bylaw for the April 27 meeting.

The three options for council were to continue with the July 2 due date, to defer property tax to August or September, or a combination of keeping July 2 for 50 per cent or less of taxes and having a later date for the remaining 50 per cent or greater. Members of council did not “feel good” about any of the options,

“There’s a lot of negatives to all of these options,” Coun. Sean Sullivan said.

One of the main concerns that arose during discussion was the longer-term effects of deferment. There was also a sense people receiving support from seniors levels of government in response to COVID-19 should be receiving payments by the July due date, and both staff and council pointed there are current deferment programs for older residents as well as for families with children.

Council decided to retain the July 2 due date by passing a motion for staff to prepare the property tax for the same due date as in previous years.

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