Comment 29965

By A Smith (anonymous) | Posted April 06, 2009 at 12:18:41

>> cities that spend money on the right things are able to make enough money that they can start to cut their tax rates once more investors move in and property values start to go up.

Burlington (including their share of Halton region) employs approximately 2,100 workers and spends $140M on compensation. Burlington is 3x smaller than Hamilton, so if it had our population, these numbers would be 6,300 workers and $420M. In contrast, Hamilton has 9,000 employees and spends $548M on compensation.

Therefore, each resident of Hamilton pays $1096 in employee costs, whereas each resident of Burlington only pays $840.

How do you explain Hamilton's lower property values, even though we hire more people to do the "right things"?

If Hamilton currently spent the same amount of tax dollars/capita on employees that Burlington does, we could reduce employee costs by $128M. The tax levy in 2008 was $630M, so if we subtract $128M from the bill, it would only come to $502M.

$502M/$630M = .797

.797 X 1.646% (residential tax rate) = 1.31% (new tax rate)
.797 X 4.57% (commercial tax rate) = 3.64% (new tax rate)
.797 X 6.44% (industrial tax rate) = 5.13% (new tax rate)

Therefore, even without assuming that lower tax rates would increase demand for property (thus increasing assessments), just by cutting back on city staff (to Burlington levels), Hamilton could lower tax rates by 20%. That means, if you own a $200,000 house in Hamilton, you pay $672 more per year in city employee wages, than you would if you lived in Burlington.

How is it possible that we pay for more services and yet still have lower property values? It doesn't make sense.

Permalink | Context

Events Calendar

There are no upcoming events right now.
Why not post one?

Recent Articles

Article Archives

Blog Archives

Site Tools

Feeds