It’s been some years since we heard about tax revolts in Saskatchewan. However, if Fred Weekley has his way, those days may soon return. Mr. Weekley, mayor of the District of Katepwa, publicly suggested that, illegal or not, withholding school taxes may be called for.
Around Katepwa Lake, roughly three quarters of the property tax bill is for schools. Mayor Weekley says rising property values may push one Katepwa couple’s property tax bill from $2,700 to $3,700. But the residents of Katepwa are not alone in seeing rising school tax bills due to rising assessments. The provincial funding formula assumes that the higher the assessment value, the greater a municipality’s capacity to tax money for schools.
Thus, the province actually gives less school funding to areas with higher property values. In December, school boards in Regina and Saskatoon claimed they will lose $16.8-million due to rising assessments. To make up the difference they will have to hike school taxes by more than 8 percent.
Saskatchewan relies more heavily on school property tax to fund schools than any other province. Such taxes provide for about half of K-12 schooling budget, while the provincial government pays the other half. But, it’s even worse in rural municipalities. In fiscal 2007, school taxes represented 62.5 percent of rural property tax bills. Rebates only reduced this figure by 6 percent.
Exasperating this hit to rural residents are changing demographics. Statistics Canada data indicates that Saskatchewan farms have grown 13 percent in size from 2001 to 2006, while the number of farmers have dropped by 12 percent. Farms are larger, with fewer farmers and thinner profit margins. Therefore, farmers are paying more school taxes than ever at the same time rural schools are closing. On top of this, the average age of farmers continues to grow, meaning those who have paid too much school tax all their lives are rewarded by paying even more.
Is the problem new? No, not at all. In the early 80’s the province paid about 60 percent of the school bill. But in 1986, the Saskatchewan Local Government Finance Commission suggested that should be bumped to 75 percent. That advice was ignored and fifteen years later, the province paid just 39 percent. Again in 2003, the Boughen Commission recommended an 80 percent provincial share.
Slow progress has brought the provincial share back to just over 50 percent. But clearly that’s not enough.
So will this most pressing issue be dealt with in the upcoming provincial budget? Possibly. MLA Jim Reiter’s report on school taxes will soon be in the hands of the finance ministry. However, the findings won’t be made public until after the March 18th budget—not a good sign for prompt action.
And it’s not like the Wall government doesn’t understand the issue. In 2005, Sask Party MLA Yogi Huyghebaert chided the NDP government for dragging its heels on school taxes, saying, "There's been enough study. It's time for action."
In mid-2006, Brad Wall said, "2007 is far too long to wait for property tax reduction."
It’s now 2009, Wall is in power, and everyone is still waiting. “I mean somebody get a backbone and do something to change this,” Mayor Weekley told Global TV. “We’ve had 10 years of talk. That’s probably enough time.”
The mayor predicts a “big roar in this province” if the upcoming budget provides nothing but school tax rebates.
He is absolutely right. And the government would deserve no less.
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