The city will continue to collect fees on behalf of the Downtown Penticton Association, but those fees will not be indexed to inflation as originally proposed.
Council passed three readings of the downtown business improvement area bylaw introduced last Monday, which establishes the fees or parcel taxes to be paid by businesses in a specifically designated area. The bylaw expires on Dec. 31, 2012, but the association preferred to renew for the current year’s tax roll.
Chief financial officer Doug Leahy said that this was the second renewal for the DPA, and that the city just acts as a bank to collect the levies from affected areas. The DPA budgets accordingly.
Those fees, according to a staff report, go to the DPA for the purpose of planning and implementing business promotions.
The fee was originally proposed to be $0.987 per $1,000 of assessed value on Class 5 and 6 taxable land and improvements, which would be increased according to the Consumer Price Index each year.
“My hats go off to the DPA and what they do,” Mayor Dan Ashton said, noting that the association has also worked hard to increase their membership. “But I’m not a fan of automatic increases.”
Coun. Wes Hopkin said that the DPA’s budget could be “heavily affected” by the cost of inflation. If the funds collected remain the same, in five years’ time, “their budget is going to shrink precipitously because of this.”
Coun. Andrew Jakubeit, however, noted that the fees are charged based on land and improvement value. As those go up, so consequently do the fees collected. “This sort of helps flatten it out,” he said.
Coun. John Vassilaki moved the staff recommendation, with the exception of the CPI element to fees. Council unanimously passed three readings.