Report to: General Committee Date of Meeting: January 12, 2009

SUBJECT: E3 Initiative – Property Tax Installments

PREPARED BY: Paul Wealleans, Director, Taxation

RECOMMENDATIONS:

THAT the report “E3 Initiative – Property Tax Installments” be received;

AND THAT Council approve changing the due dates for each of the three final tax installments from the third week to the 5^th day of each respective month, effective for the final tax billing for the 2009 tax year;

AND THAT staff be authorized and directed to do all things necessary to give effect to this resolution.

EXECUTIVE SUMMARY:

Not applicable.

1. Purpose 2. Background 3. Discussion 4. Financial

5. Others (Environmental, Accessibility, Engage 21st, Affected Units) 6. Attachment(s)

PURPOSE:

This report will provide detail on the E3 initiative regarding changing the dates of property tax installments.

BACKGROUND:

At the E3 Steering Committee meeting of October 28, 2008, the committee considered the proposal to reduce the number of tax installments from 6 to 4.

In subsequent meetings of the Steering Committee and Budget Sub-committee, it was decided not to reduce the number of installments due to customer service concerns but rather to change the dates of the installments from the third week of the month to the fifth day of the month unless the 5^th falls on a weekend in which case the due date will be the following workday. Staff recommended that, due to time constraints, this change only apply to the final tax installments in July, August and September for residential properties and October, November and December for non-residential properties.

OPTIONS/ DISCUSSION:

The option of moving the dates for the 6 installments has been reviewed and analyzed by Finance staff. This option would move up the due dates two weeks so the due date is the 5^th day of the month for February, March, April, July, August and September. The reason that the 5^th day of the month is selected is to ensure that all prior month end payments have been accounted for and reconciled. The dates for non-residential bills would also be changed to reflect a due date of the 5^th of the month.

When this was discussed at committee in late 2008, staff recommended that due to time constraints, and to not impose change to residents without proper notification, the 2009 Interim installments for February, March and April remain the same as currently (which is the third week of the month) and that the proposal of a due date of the 5^th take affect for the final tax billing.

For 2009, the proposed due dates would be:

	Installment Dates for 2009
Installment	Interim Billing Residential and Non Residential	Final Billing Residential	Final Billing Non-residential	Comments
1	February 18			No Change
2	March 18			No Change
3	April 22			No Change
4		July 6	October 5	Change
5		August 5	November 5	Change
6		September 7	December 7	Change

Note that the three installment dates for the Interim billing have already been approved by Council at its meeting of December 16, 2008.

For 2010, it is recommended that the dates for all 6 installments be moved to the 5^th day of the month.

The move of the due date up two weeks will improve cash flow and enhance investment income. Finance staff analysis estimates that, based on current rates, an additional $300,000 in investment revenue for 2009 would be achieved by changing the three final due dates. For a full year, 6 installment change, the increased investment revenue is estimated at $600,000.

Staff will ensure a plan to communicate this proposed change to Markham residents occurs prior to the mailing of the final tax bills which will include a notice in the 2009 Interim tax bills as well as on the Town’s website and in the Town page of the Markham local newspapers.

FINANCIAL CONSIDERATIONS:

Moving the due dates for the six tax installments from the third week of the month to the 5^th day of the month will generate an estimated $600,000 in annual investment income for the Town.

For 2009, the change for three due dates for the final billing is estimated to generate $300,000.

FINANCIAL TEMPLATE:

Not applicable.

ENVIRONMENTAL CONSIDERATIONS:

None

ACCESSIBILTY CONSIDERATIONS:

None

ENGAGE 21^st CONSIDERATIONS:

None

BUSINESS UNITS CONSULTED AND AFFECTED:

None

RECOMMENDED

BY: ________________________ ________________________

Barb Cribbett, Treasurer Andy Taylor, Commissioner

Corporate Services

ATTACHMENTS:

None

Q:\Finance\SHARED\2009 General Committee Finance\901 E3 Property Tax Installments.doc