Community Services Minister Richard Mostyn. (Haley Ritchie/Yukon News file)

Community Services Minister Richard Mostyn. (Haley Ritchie/Yukon News file)

Whitehorse councillors concerned about proposed retrofit loan program

Municipalities would be tasked with collections on property taxes

Concerns are being expressed by Whitehorse city councillors over a loan program that’s being initiated by the Yukon government that would encourage building retrofits for greater energy efficiency.

The legislative changes for the proposed program are expected to be passed in the legislature in the coming days.

Under the program, the territory would lend out the funds to approved property owners for the retrofits. Municipalities who sign on to the program would then be responsible for collecting the loan over a 15-year period with payments to be added to property tax bills.

At Whitehorse city council’s Nov. 22 meeting, Coun. Michelle Friesen brought the issue forward under new business, arguing that while the program’s intent is good, “key information” is missing.

She highlighted the responsibility of municipalities to collect the loan and the impact that could have on the “capacity of our already hardworking staff.”

With a maximum proposed $50,000 loan on residential properties, residents who take out the loan could see a significant increase on their annual property tax bill, she said.

She also pointed out the legislation is coming forward just after municipal elections in the territory and new councils need time to look at the details.

“It remains a priority for me to work towards strong, respectful partnerships with other governments and organizations,” Friesen said. “And I think this is the perfect opportunity to model what that could look like. I would like to see the Government of Yukon hold off on passing legislation, getting to the table together to address some of the concerns we’ve been hearing, share ideas and bring this legislation back in the spring.”

All members appeared to agree with the intent of the program. Many also echoed Friesen’s concerns — “There’s a lot of unanswered questions,” as Coun. Dan Boyd put it — but, both Mayor Laura Cabott and Coun. Kirk Cameron suggested many of the details will be addressed through the regulations developed for the program.

“That’s where the meat is,” Cabott said, after pointing out that while more time to work on the program would be nice, climate change is here and already having an impact.

“What I know about this program is, it is very potentially very favorable to people that wouldn’t normally be able to retrofit their homes because the interest rate is very, very low,” she said. “It’s attached to the home, it’s not attached as a personal loan.”

Questioning city administration about whether the city could develop its own similar program, acting city manager Jeff O’Farrell confirmed that could be an option, though it would come with “tremendous administrative overhead.”

Under the proposed program, the territory would serve as the intake and lending authority with municipalities like Whitehorse taking on the collections.

Cabott also cited discussions with Community Services Minister Richard Mostyn at an Association of Yukon Communities (AYC) board meeting over the weekend, noting the minister’s commitment to revisit a proposed $500 amount the territory would provide to municipalities to administer the program.

A joint municipal-territorial working group will develop regulations for the program.

Friesen argued she would rather see the working group in place before legislation is passed.

While municipalities have the option of being part of the program, once the legislation is passed there will be a lot of pressure from property owners to offer the program, she said.

Meanwhile, AYC president Gord Curran said it was decided at the last board meeting communities would discuss the matter among their own councils before coming back to the organization.

Prior to the October municipal elections, the sentiment among municipalities about the program was clear.

“The majority of our municipalities didn’t want to take on that task (of collecting the loans),” he said.

With new councils just starting their terms, the organization wants to gauge the stance of municipalities once again before taking a clear position on it.

In his own Village of Teslin, he said council would rather see the program run through one entity — the Yukon government.

That’s because disputes over amounts owed can lead to a tax lien on the property, and eventually the village seizing a home.

In many communities it’s likely the collectors know the property owner, he said. There’s also limited staff available.

“For us it boils down to one or two people,” Curran said, adding the entire municipality has about a dozen people on staff.

In a Nov. 23 interview, Mostyn said the Yukon government would work with municipalities to address the concerns, but also stressed the importance of the legislation passing as the impacts of climate change continue.

“It’s important we get moving,” he said, emphasizing the program’s opt-in option for municipalities.

He confirmed the territory considered administering the program on its own, but that wasn’t pursued.

He explained if such a program were run under Yukon Housing rather than as a local improvement charge added to property tax bills, borrowers would have to take out the money as a personal loan which would come with a much higher interest rate (0.25 per cent currently for a LIC (local improvement charge) versus 2.5 per cent for a loan). That model would also leave out commercial properties, he said.

By adopting the legislation in the fall sitting, Mostyn said the territory will be ready to roll it out to those living in unincorporated areas of the territory where the territory oversees tax collection.

“It’s important we start to act,” he said.

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