ThINC ~ Will Land Conservation Raise Your Property Taxes?

This question has been asked in relation to the Lower Burchell Hill Nature Reserve Project. To answer this question ThINC has applied the protocol that the Islands Trust Fund has used in relation to conservation covenants to a hypothetical acquisition. The answer is yes, but you won’t notice it, the increase is microscopic. Here’s why.

A hypothetical property on Thetis Island, let’s call it Property A, with an assessed value of $540,000, is sold to a conservation organization for a nature reserve and as a result, becomes property tax exempt. What happens to the $3,656.69 tax previously paid on Property A? Taxation income to taxing authorities is not reduced by tax exemption programs; the ‘loss’ is shifted to other properties throughout the appropriate taxing authorities (i.e., across the Province, the Regional District, the Islands Trust Area, or Thetis Island.) Here’s an example of the math for 2014 taxes for Property A (based on real numbers from a real tax notice for a developed residential property. An undeveloped property will be less.). 

The provincial school tax for Property A in 2014 was $1,248.26. There were 1,954,952 other taxable properties (folios) in the province in 2014, and as the tax shift for provincial taxes such as for schools from Property A would be distributed across the entire province, the increase for each folio would be $1248.26 /1,954,952 folios which equals $0.001 per folio, virtually 0.

Similarly, the Thetis Islands Trust Area Levy on Property A of $420.51 would be distributed across the other 22,470 folios in the Islands Trust Area for an increase per folio of $0.02. 

The following chart shows the hypothetical estimated tax shift for all the tax categories listed on Property A’s 2014 tax notice. The chart shows that the creation of a nature reserve on Property A will increase other Thetis Island property owner’s property taxes by less than a loonie.

Any questions or comments about this analysis can be directed to Ann Eriksson at 250-246-8176. Thanks for your interest.