The Town of Ponoka is moving forward with a program that would provide a tax break incentive aimed at attracting new residents to Ponoka.
“There’s apparently active interest in the real estate market nowadays,” said Chief Administrative Officer (CAO) Albert Flootman, adding that Penhold is already doing a similar program.
Originally, the proposed New Development Tax Incentive Program was geared towards giving buyers of new, never lived-in homes a 50 per cent reduction in municipal taxes over a three-year period, but throughout the discussion during council’s July 14 meeting, it was decided to include all home buyers new to Ponoka.
Council passed a resolution in June that administration start working on a municipal tax incentive for purchasers of new commercial and residential properties.
Mayor Rick Bonnett says his concern is that Ponoka doesn’t have a lot of brand new homes.
“When we talked about proposing this, it was basically to try to draw some people out of these cities,” said Bonnett.
“I think it’s more about whether you’re new to Ponoka rather than a new home, period, because Ponoka is not sitting on a whole lot of news homes that are up for sale and never lived in.”
Penhold, in contrasts, does have a fair number of new homes that are being built by developers, he says.
Bonnett says part of the marketing to invite people to move to Ponoka would be based on low COVID-19 cases, short line-ups and access to amenities and open spaces, which may be lacking in larger centres.
Coun. Sandra Lyon, who is a real estate agent, added she believes there is only one new, unsold home in the Laebon subdivision in Ponoka.
Lyon also agreed that the program should not be strictly for new houses, but based on new residents.
Flootman responded, saying when the program was first discussed, it was about increasing new assessment.
“So that was the focus when we designed this,” said Flootman.
“What you’re doing tonight is shifting the focus to new residents, and I think that’s a good thing from an economic development perspective, as it’s the people that bring economic activity, so thank you.”
He added that council should be careful to avoid unintended consequences.
“For example, we wouldn’t want to provide an incentive to demolish and rebuild a house if that house has been identified as a heritage resource — it wouldn’t be appropriate,” he said.
“These are preliminary comments. I just want to caution council against moving too quickly.”
Administration asked council if they could go ahead with marketing the program immediately, or if council wanted them to wait before they were presented with the full program for their approval.
It was felt timing was important, as people from larger centres are apparently considering moving to smaller and more rural communities as a result of the ongoing pandemic.
Flootman recommended council wait until the complete program is presented, but told council, if they chose to go ahead with the marketing, “I just want to emphasize that you are, in essence, promising a program’s coming and these will be the basic terms and conditions.
“So if you’re ready to commit yourselves to that without seeing any other background, great, but I would just recommend caution.”
“That’s why we asked you to look into it, because we’re committed to doing it, because, I know in the couple other towns [that have implemented similar programs] that people will have moved there and are building, because of this,” said Coun. Ted Dillon.
“Let’s get on the wagon, let’s get it moving.”
Coun. Kevin Ferguson was in agreement, saying, “Let’s jump in the pool, let’s get ‘er going.”
Coun. Carla Prediger argued that starting a conversation now shouldn’t commit the town to any details, such as exact numbers of timelines.
“The communication … shouldn’t adhere us to the communication. It’s a heads up, and that gives you enough time to get the facts together and to present us with a bona fide plan to move forward,” said Prediger.
“If we’re going to tell the public that there’s going to be a tax incentive program coming for residential, we need to give them some idea of what it is,” said Flootman.
Prediger says the communication could say the town is looking into a possible program, rather than saying it’s coming.
“It’s how you present the communication, so it’s not binding,” she said.
The cost of developing the program is expected to be about $12,000, funded from the economic development budget. This price does not include the cost of marketing the program.
Prediger made the motion that council move forward with the tax development incentive program for both new residents and buyers of new homes, and that marketing begin immediately, with the full plan to be presented to council at the next council meeting on Aug. 11.