Is a neglected house truly 'uninhabitable'? This is the core question at the heart of a debate in Sault Ste. Marie, Ontario, regarding its vacant home tax (VHT) bylaw. The city is grappling with a loophole that, ironically, might be encouraging homeowners to let their properties fall into disrepair. Let's dive in!
The current bylaw, implemented on January 1st of last year, levies a 4% tax on vacant homes. However, it includes an exemption for properties deemed 'uninhabitable for reasons beyond the owner's control.'
But here's where it gets controversial...Jenna Ricard from the city's legal department is advocating for the removal of this exemption. Her report, prepared for Mayor Matthew Shoemaker and city councillors, argues that the term 'uninhabitable' is too vague and subjective. The city has found that this exemption is being exploited, acting more as a loophole than a genuine safeguard. The recommendation is clear: eliminate the 'uninhabitable' clause to prevent neglect, ensure homes are either occupied or taxed, and uphold the VHT's original purpose.
A working group, including representatives from various city departments, reviewed the bylaw. They found the 'uninhabitable' exemption difficult and expensive to enforce, requiring inspections and approvals. Interestingly, while the provincial policy framework suggested this exemption, it wasn't mandatory.
And this is the part most people miss... The review also revealed that other Ontario municipalities with similar bylaws don't include an 'uninhabitable' exemption. Instead, cities like Ottawa and Hamilton use a 'hazardous property' exemption, which is much stricter, applying only to properties uninhabitable due to hazardous conditions or significant damage from events outside the owner's control.
On Monday, the city council will consider Ricard's proposal to remove the 'uninhabitable' clause and introduce more specific criteria for exemptions related to major repairs or renovations. These additions include:
- 'Major repairs or renovations': Defined as work requiring building permits that renders the property unoccupiable for at least 183 days of the tax year due to the lack of essential facilities or conditions for safe occupancy. These include sanitary facilities, kitchen areas, electrical, plumbing, heating, or mechanical systems, structural integrity, fire separation, weatherproofing, and safe access.
- Routine maintenance and cosmetic improvements will not qualify.
- Major repairs must be actively and diligently carried out without delay.
- The exemption for major repairs can only be claimed once every five consecutive tax years.
- Property owners will need to provide supporting documentation like building permits, inspection reports, and contractor invoices.
- These changes will apply to future VHT declarations, including those for the 2025 tax year.
What do you think? Do you agree with the city's assessment that the current exemption encourages neglect? Should the definition of 'uninhabitable' be more strictly defined? Share your thoughts in the comments! The city council meeting will be livestreamed on SooToday starting at 5 p.m.
