Mayor Leal and Council,
In 2008, I was a part of a committee formed by the Kawartha Manufacturers Association and the Chamber of Commerce. We worked with the Council of the day to have them act on regulation 386/98 of the Municipal Act, 2001. The Provincial Government had brought in substantial changes to the municipal property taxes with current value assessment and revisions for tax fairness. It was found that municipalities overtaxed business properties relative to the services they received and that Industrial and Commercial rates should be at 85%, and no more than 110% of the residential rate.
Industry in Peterborough was paying 260% of the residential rate in 2008 and Council committed to a 10-year journey to reach a 1.5 multiple milestone, with the intention to eventually get to parity with residential. Industrial tax rates reached that milestone two years ago.
The previous 4 Councils worked hard towards tax fairness in Peterborough. This Council is going backwards.
My company, Merit Precision, is a contract manufacturer of plastic, steel, and zirconium parts to a wide variety of industries over much of North America and Europe. We employ about 80 people in Peterborough.
Last year Merit paid $123,395 in property tax, or the profit on its first $2.47M in revenues.
Unlike Government, Merit is unable to raise prices to offset increased costs as pricing is set on the world stage. Unlike Government, Merit will have to reduce costs to maintain a realistic margin or go out of business.
The City of Peterborough does not have a tax revenue problem. It has a cost problem. I see nowhere in your deliberations that you have attempted to reduce your costs in any meaningful way. It is certainly appropriate to raise taxes to pay for capital improvements, but a 10% increase for operations is outlandish.
If you do opt for the easy way out, please never again lament the lack of manufacturing jobs in this community.
Respectfully, Tim Barrie, President, Merit Precision Ltd.
The Peterborough and the Kawarthas Chamber of Commerce has issued a letter to City Council and a media advisory regarding the tax ratio increase.
The Peterborough and the Kawarthas Chamber of Commerce acts as a catalyst to enhance business growth, opportunity, innovation, partnerships and a diverse business community.