Publisher’s Column: Vacation Rentals, Tax Increases and Getting Our Fair Share

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By John Francis

Greetings from Tybee Island, Georgia. It’s our first real trip in four years and as usual, something of a busman’s holiday.

That is to say, we’ve gone on vacation in a place that looks a lot like the Bruce Peninsula.

Tybee Island is at the end of a highway — Georgia Hwy 80. It is the local beach for the 150,000 people in nearby Savannah, but it is also the nearest beach to Atlanta, four hours to the northwest.

It’s pretty quiet in the winter, ridiculously busy in summer. But there is paid parking, all year long for every parking space on the island. It’s $4 per hour ($5.40Cdn) with a two hour minimum. Everybody complains but everybody ponies up — even the residents. A few businesses offer customer parking but they are the exception, not the rule.

As one local explained it: “How else do you provide service to two million visitors every year from Atlanta? Local taxpayers sure can’t afford it.”

Then there are the “Vacation Rentals”, which is what they call STAs down here. As I cycle through town (bicycle parking is free) I see signs on about half the properties. Tybee Island Vacation Rentals. Tybee Beach Vacation Rentals. Tybee Vacation Rentals. Tybee Shores Vacation Rentals, Georgia Coast Vacation Rentals. And many more.

A local paramedic I chatted with says she has no hope of buying a house here. The vacation rental companies are aggressively buying up properties and they have driven prices beyond what she can afford to pay. She says it must be even more difficult for people working in retail and food service.

Most local stores and restaurants on Tybee Island are closed two or three days a week. They can’t get staff. The local supermarket (there is only one on the island) is open daily from 8 to 8, but the deli closes at 2. They can’t get staff.

I met a fellow birdwatcher from Savannah on the beach. He told me that Savannah doesn’t have this problem — they got out ahead of it and passed a bylaw years ago restricting all rentals of less than 30 days.

But Tybee got caught like deer in the headlights.

Interesting fact: Georgia’s minimum wage is $5.15 per hour (I’m not making this up) but Savannah has a minimum wage of $15 and the mayor has resolved to raise it to $15.70 this year. Some businesses are complaining but the mayor points out that he campaigned on this in last fall’s election and the majority of voters obviously approve.

But I am guessing that even if wages went up to $15.70 Tybee’s retail and food service workers would have a hard time affording housing on Tybee.

What Will a 7.2% Tax Hike Mean to Low-Income Ratepayers?

At a recent budget meeting, our Mayor and Deputy Mayor both argued in favour of maintaining our infrastructure and services, even if that requires raising taxes.

One Councillor argued against tax increases. She said that tax increases are unfair to low-income residents of MNBP and predicted that many households will be unable to pay their taxes and will fall into arrears.

This seemed like a good opportunity to jump in with a little arithmetic for context.

First I’m going to make an assumption — that our low-income residents don’t live in million-dollar houses. I think it’s fair to assume that most low-income folk live in properties with an assessed value of $300,000 or less (note that assessed values are lagging far behind the recent spike in real estate prices).

The proposed municipal tax increase on a $300,000 home would be $101.10.

Are you outraged by this? Me neither.

I’ll go with the Mayor and Deputy Mayor on this issue — $101.70 is not a major problem for our least affluent households. The rest of us will pay more than that but we can afford it.

Getting Senior Governments to Pay Their Share

As Councillor Smokey Golden has said many times at council meetings, the governments of Ontario and Canada get a lot of benefit from tourism in MNBP (8% and 5% respectively in sales taxes for starters) yet they put almost nothing back.

And as Deputy Mayor Rod Anderson pointed out at a budget meeting a few days ago, we send $8 million a year in property taxes to Bruce County and get very little back.

But as the Deputy Mayor said about Bruce County: demanding a renegotiation is not something you undertake without careful thought — we need to get our ducks in a row.

But it’s worth devoting staff time (and possibly hiring consultants) to get those ducks in a row. The Councillor and the Deputy Mayor are both right — we are not getting our fair share from the senior levels of government. But we need to prove it clearly and come up with clear plans for how they could — and why they must — level the playing field.