At Weston Web, we occasionally run across things that were once a good idea but now no longer work. One of them was a generous property tax rebate given to landlords of empty stores. We wrote about it back in 2013 and were pleasantly surprised when about a year ago, Mayor John Tory pledged that he would eliminate the break that had ended up doing more harm than good.
The 30% tax discount began during an economic downturn in 1998 when the Province thought it would help Ontario landlords struggling with vacant storefronts. Although times changed, Toronto continued to reward owners after a qualifying 90 day vacancy. The generous plan backfired somewhat as it reduced property tax revenues by about $22 million annually and encouraged longer store vacancies since owners are rewarded only when they hit the 90-day qualifying mark. This lower pressure to find a tenant also encouraged landlords to hold out for higher rents.
In a corner of the city struggling to keep a viable retail sector, ending the rebates may help reduce the number of empty storefronts that plague Weston and Mount Dennis. Property owners have been given notice that as of June 2018, the rebates will end after a phase-out period that began last January. The Province passed the necessary legislation on May 17, allowing the city to come up with the timeline. Well done Mayor Tory and the Provincial Government.
Incidentally, this year, claiming a shortage of money, the city kept Toronto Public Library’s budget increase to a mere 0.9% and Ontario then piled on by reducing the TPL allocation by $700,000 for the next two years.
Let’s hope that with the additional revenue, the library’s budget can now be brought up to where it should be.