CANMORE – The vacancy tax for Canmore will head to council expecting to draw upwards of $12 million in 2025.
The Town’s finance committee recommended at its Dec. 5 meeting that council approve the new vacancy tax for a budget of $12 million in 2025 and 2026 then come down to $10.5 million in 2027 and 2028.
Finance committee voted 4-3, with Couns. Tanya Foubert, Jeff Hilstad and Karen Marra opposed moving forward at the extra 0.4 per cent assessed rate for second homeowners. Council will vote on the final amount at its Tuesday (Dec. 10) meeting.
“I want ratepayers, whether they’re primary or not, to see what the full intent of council is in terms of the long-term,” Coun. Joanna McCallum said, highlighting the intent was to fund housing initiatives in the community.
McCallum said she felt 0.5 per cent was more acceptable for 2025 and 2026 than 0.4 for 2027 and 2028. She added she felt it was important to have a four-year forecast to give second homeowners an idea what to expect in coming years.
Town staff recommended the finance committee move ahead with a first-year amount of an estimated $9 million to be collected, or 0.3 per cent of assessed value of second homes in Canmore.
An updated draft budget to run the vacancy tax had salaries, wages and benefits at $513,418 in 2025 and $522,666 in 2026.
The finance committee went in camera with eight municipal staff for 31 minutes to prevent disclosure of business information of a third-party and pending budgetary decisions.
A list of examples that could be funded had options such as the Town’s portion of the 100 Palliser Lane affordable housing project at $12 million in 2025; downtown transit terminal and public washroom design and construction at $6.1 million in 2025 and 2026; Stoneworks Creek flood mitigation at $3 million in 2026; a Palliser pedestrian crossing at $14 million in 2028 and a transit facility at $15 million in 2030.
Other options such as Larch area land use intensification, accessory dwelling units program and marketing and purchase of units at Lawrence Grassi Middle School area redevelopment plan were also highlighted.
Town staff noted they’re not projecting to collect the full amount that’s set in 2025.
Coun. Jeff Hilstad made the first motion to collect 0.3 per cent of the assessed rate for second homeowners.
An amendment from Coun. Wade Graham had it lifted to 0.5 per cent – with an estimated collection of $15 million – saying the Livability Task Force aimed to have a “meaningful number” and “to me, that means to move the needle.”
“We have a lot of capital projects, and we need to fund them,” he said, noting his hope was the tax leads to second homeowners renting out their homes and the higher rate would encourage such an act.
Both Couns. Jeff Mah and McCallum expressed support for the 0.5 per cent rate, but Foubert, Marra, Hilstad and Mayor Sean Krausert all said it was too high to start. They each said they wanted something below what tourist homes pay, which would come in slightly above the 0.4 per cent rate.
Krausert said it was “too high in my opinion” and he felt the Livability Task Force wanted it to be “meaningful [but] not punitive and not excessive.”
Hilstad added it was important to get more firm information, with the 26 per cent second homeownership in the community an estimate and not a confirmation of what to expect.
“Once you get to a spot, it’s a lot harder to lower it than you think. If anything, I could see it increasing. We don’t even have numbers yet on exactly how many units and every year that’s going to change. … To me, this is a healthy starting point,” he said, preferring to start the vacancy tax at the 0.30 per cent rate. “I think it is impactful. I think it isn’t punitive. As it goes higher, it becomes more punitive. … It’s supposed to be part of the solution. It’s not a silver bullet.”
Foubert said she understood the urgency, but that “$9 million is not an insignificant amount of money” and additional work on establishing clear goals to finance were key. She added the responsibility shouldn’t entirely lie on second homeowners, but the whole community, provincial and federal governments.
“Any time we increase our tax rate and take money from taxpayers, it’s a meaningful amount. I think it’s really important when we do that there’s a responsibility about being very clear how and what we spend that on,” she said. “I think we’re moving with great speed to ensure that this work gets done now, I’d prefer to take a more conservative approach out of the gate with the 0.3 per cent originally proposed. There’s still much to be worked out.”
An amendment to Graham’s amendment from McCallum had the vacancy tax rate come down to 0.4 per cent in 2025 and 2026 to find a middle ground. She added 2027 and 2028 should be looked at the 0.35 per cent rate, or $10.5 million each year.
Mah supported the change, saying it wasn’t as high as he wanted to move ahead with initiatives and projects but that it felt it was a “nice compromise.”
Following a five-minute break, Krausert served as the swing vote in recommending the 0.4 per cent rate of assessed value for second homeowners for the vacancy tax.
After expressing 0.35 per cent was his preferred spot, Krausert said members of the committee had time to reflect and potentially change the recommendation when council meets.
He said it was important to not put the entire funding of housing on one particular portion of the community, but key for them to pay a fair share.
“If you do not have a primary residence, I firmly believe you should pay more – significantly more – because we know second homeownership is ultimately the reason that mountain communities with limited land footprint and high desirability globally that ultimately it goes to the highest bidder,” he said, adding the need to have a full rounded community such as teachers, nurses and small business owners.
VACANCY TAX OPTIONS FOR SECOND HOMEOWNERS
- 0.10 per cent of assessed value = estimated $3 million
- 0.15 per cent of assessed value = estimated $4.5 million
- 0.20 per cent of assessed value = estimated $6 million
- 0.25 per cent of assessed value = estimated $7.5 million
- 0.30 per cent of assessed value = estimated $9 million
- 0.35 per cent of assessed value = estimated $10.5 million
- 0.40 per cent of assessed value = estimated $12 million
- 0.50 per cent of assessed value = estimated $15 million
- 1.00 per cent of assessed value = estimated $30 million
- 3.00 per cent of assessed value = estimated $90 million
MUNICIPAL LEVY BASED ON 2024 MILL RATES
RESIDENTIAL CONDO ASSESSED AT $761,000
- Primary residence: $1,559
- 0.25 per cent: $3,461
- 0.30 per cent: $3,842
- 0.40 per cent: $4,603
- 0.50 per cent: $5,363
- Tourist home: $4,776
MEDIAN ASSESSED VALUE AT $1.043 MILLION
- Primary residence: $2,136
- 0.25 per cent: $4,743
- 0.30 per cent: $5,265
- 0.40 per cent: $6,308
- 0.50 per cent: $7,350
- Tourist home: $6,545
