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Transit Tax Q & A's
August 2009

Question:  Why has the way in which HRM collects Transit Tax changed for this year (2009-10)?

Answer:  The way in which HRM collects Transit Tax has changed to allow an appropriate means of sharing the costs of transit, including the expansion of transit services into more rural areas of HRM, such as the MetroX (rural express) services starting up this year.

Question:  What has changed?

Answer:  The capital and operating costs of all transit services were always included in the residential general tax rates in previous years, so it simply wasn't visible on tax bills.  It has since been removed from the residential general tax rates, thus all three residential general tax rates have declined and community transit area rates have been elimininated.  The pre-existing transit taxes will now be collected through two specific rates, the “Regional Transportation” and “Local Transit” area rates:

  • “Regional Transportation” rate of $0.045 (per $100 of assessment) is applied to all residential/resource properties, except those outside of the HRM commuting area (the Eastern Shore, east of Jeddore Harbour, and the Musquodoboit Valley)
  • “Local Transit” rate of $0.088 (per $100 of assessment) is applied to all residential/resource properties (in addition to the regional rate) that are within a 1-km walking distance of a transit stop.

Question:  Why are there two area rates (rather than one)?

Answer:  The two rates allow the taxes to better match those who directly and indirectly benefit from the different services.  A Regional Transportation rate will fund services such as the MetroLink, MetroX and ferries that are used by people traveling from diverse areas of HRM.  The Local Transit area rate will fund routes such as routes 1 through 89 and community transit that people are more likely to access by walking.

Question:  Which transit routes and stops are used, when considering the 1-km walking distance?

Answer:  All conventional Metro Transit and community transit routes active in 2009-10 are considered, including the new “Sambro Loop” route that runs from Spryfield to Ketch Harbour starting late August 2009.

Question:  How will this change affect me?

Answer:  About 89% of all HRM homeowners will see little difference in their overall tax rate.  However, some people will see a difference:

  • Those in the urban tax zone but are farther than 1 km from a bus stop will see an overall decline in tax rates [affects about 2.5% of all homeowners];
  • Those in the suburban or rural tax zone but are within 1 km from a bus or flag stop will see an overall increase in tax rates (reflecting their access to the transit service) [affects 4.5% of all homeowners, including those on new Sambro Loop];
  • Those who had previously paid a transit area rate – e.g. in Hammonds Plains, Lake Echo/ Porters Lake/ Grand Desert and Beaverbank – but are farther than 1 km from a bus or flag stop will see an overall decline in tax rates [affects about 4% of all homeowners].

Question:  Specifically how much would the tax rate change for each of these (above) groups?

Answer:  About 92,500 homeowners will see their rate stay within $0.002 of the overall 2008-09 tax rate.

1)     The overall rate would decline by $0.088 for about 3,000 HRM urban homeowners fit into the first category above;

2)     About 5,000 rural/suburban homeowners would see an overall rate increase of between $0.004 and $0.088, depending on whether they had paid a transit area rate in 2008-09.

3)     About 4,500 rural/suburban homeowners who previously paid a transit area rate will see their see their overall rates decline by 0.007 to 0.084, depending on the specific rate they were paying.

On average, the overall HRM tax rate (general rate + transit rates) remains the same in 2009-10 as in 2008-09.  For details of all 2009-10 general, transit tax and other area rates, see the HRM website at [link].

Question:  How much more money will be raised with the new taxes?

Answer:  The new taxes do not raise more money than would have been done using the general rates, however it does so in a way that more closely links taxes to services provided and benefits received.

Question:  Do the new rates cost more to administer?

Answer:  No.  There are no additional administration costs.  Some staff time will be required to annually confirm/update the Local Transit Area Rate boundaries.  However, HRM’s expertise in mapping (GIS) enables this to be accurately done in minimal time.

Question:  Will this new approach be reviewed?

Answer:  Yes.  This new approach to transit taxation will be reviewed prior to the 2010-11 budget year.