February 4, 2011

TO: Islands Trust

RE: Islands Trust Request for 2011/12 Budget Comments

As president of the Saturna Island Property Owners Association (SIPOA), I would like to thank you for the opportunity to comment on the Islands Trust’s proposed 2011-12 budget. The SIPOA membership of over 200 represents almost half of the island property owners.

By way of background, it will be helpful for the Trust to know that for past the five years our Association has polled our members to determine their top concerns. Each year, members consistently have stated that property taxes are the top of their list.

This year SIPOA has taken care to review your budget documents in detail. After discussions with various Association members, we are of the opinion that the Islands Trust 2011/12 budget is excessive and that it can easily be pared back so that no increase in property taxes will be necessary.

Firstly, Trust expenditures, proposed at $6.9 million, seem unnecessarily high to perform the Island Trust's required functions. And, more specifically, the two new proposed expenses relating to Saturna Island for a total of $8,000 can easily be eliminated from the budget.

It appears that the Trust is under the impression that most of us who live on Saturna are millionaires or that residents do not care about taxes or property owners here could easily afford tax increases. The reality is very different: many of us who retired with non-indexed pensions have not had an increase in years; many who own property here are just making ends meet. In fact, increased property taxes have become a financial burden for many who are trying to maintain themselves in light of the ferry fare increases being projected by BC Ferry Corporation. The Islands Trust should be taking these kinds of costs into consideration before proposing a 7.3% increase in expenditures.

Your documents illustrate that the Islands Trust has increased general property taxes for years. For 2011/12, we note the proposed levy is $6,070,000 (Budget Summary 2011-2012, Property Tax Levy from Local Trust Areas, top of page 3). This represents an increase of $314,919 or 5.5% from the 2010/11 amount of $5,755,081 (Budget History, General Property Taxes column).

Further, you state that $57,000 of this increase in revenue is expected to come from an expanded property base (Budget Summary 2011-2012, Property Tax Levy from Local Trust Areas, mid-page 3). Where do you foresee this expanded property base to come from on Saturna? And on what basis should this $57,000 benefit the Trust staff?

More generally, the "Budget History" table demonstrates that the Trust does not explicitly state the actual change in taxation percentages. For example, each year you have inappropriately understated the actual general property taxes increase percentage by the "non-market growth" amount. When total property taxes are proposed to go up by $314,919 from 2010/11 to 2011/12, please do not publish this as a 4.4% increase (BudgetSummary 2011-2012, pg. 1) when in fact its 5.5%. This is disingenuous at best.

Looking over your budget figures for the past several years, the size and unfairness of the general property taxes increase becomes apparent. Comparing your proposed amount for 2011/12 to the amount eight years earlier (for 2003/04, which was $3,124,380) (Budget History, General Property Taxes column), we find a 94.3% increase!

For the same 8-year period, the CPI Victoria increased from 100 to 113.1 - or 13.1% (Statistics Canada, Consumer Price Index, by city, 2011-01-24).

How can Islands Trust justify this disparity of more than seven times? The number of Gulf Islands remains unchanged. Raising taxes should be the last resort of government, not the “easy” solution that can be enacted with little opposition to fund an always-present litany of new or desired policies and programs. Perhaps if you could take a more serious look at the demographics of the Gulf Islands you might better understand the impact of the current Canadian economic situation on Saturna.

On behalf of our members we urge you to freeze the general property taxes 2011/12 total levy at the prior year's level - $5,755,081. Clearly this can be done because you did this for Bowen Island: the 2010/11 amount is shown as being $224,517 (Budget History, General Property Taxes column), and the 2011/12 proposal is for $224,000 (Budget Summary 2011-2012, Bowen Municipal Property Tax Levy for Islands Trust, page 3).

Forcing an increase on Saturna and on the islands other than Bowen, blatantly violates constitutional principles of equal taxation.

If I can provide further information, please contact me at sipoa@saturnanet.net


Murray Rankin
President

----- response:

From: budget 2011 [mailto:budget2011@islandstrust.bc.ca]
Sent: Monday, February 07, 2011 1:38 PM
To: Saturna Island Property Owners Association
Cc: Linda Adams
Subject: RE: Saturna Island Property Owners Comments on Islands Trust 2011-2012 Budget

Hello...thank you for your comments. They will be distributed to the Financial Planning Committee and Trust Council before they conduct their respective budget discussions.

Regards,

Craig Elder

Director of Administrative Services

Islands Trust

200-1627 Fort Street, Victoria, BC V8R 1H8

phone: 250-405-5150 fax: 250-405-5155

www.islandstrust.bc.ca