Finance Minister Carole James explains her budget measures in Victoria, Feb. 20, 2018. - Credit: Tom Fletcher/Black Press

Changing MSP premiums will cost Lake Country $65,000

As MSP premiums are changed to payroll tax, the district will have to compensate

With changing Medical Services Plan premiums and the introduction of a payroll tax, the District of Lake Country will have to find a way to fund just over $65,000.

The B.C. government will phase out MSP premiums a year earlier than promised in the last election, and impose a payroll tax on larger businesses to recover some of the revenue collected by Canada’s last remaining health-care charge.

The “employer health tax” takes effect Jan. 1, 2019 and applies to businesses with annual payrolls of more than $500,000, some of which now pay MSP premiums on behalf of their employees. The tax rate is 1.95 per cent for businesses with payroll above $1.5 million, with reduced rates for payrolls between $500,000 and $1.5 million.

Businesses that pay employees’ MSP, at a rate that was cut by half at the start of 2018, will also pay the payroll tax for a year, before MSP is ended on Jan. 1, 2020. This includes the district.

“This change from MSP to a payroll tax will result in the largest financial implication to the district,” said a report which will be presented during Tuesday night’s regular council meeting.

“The net financial impact is approximately a 0.1 per cent tax impact to the taxpayers of the district starting in 2020. Funding the 2019 impact of $65,475 and the ongoing impact will be discussed at the time the 2019 financial plan is presented to council,” the report said.

The district will either have to increase taxes for a year or fund the shortfall from reserve funding, said chief financial officer Tanya Garost.

It will be likely that district staff will recommend using reserve funding to avoid increasing and decreasing tax rates, she said.

“The Government Finance Officers of BC and UBCM are considering options to share the concerns of local governments with the province on the impact of this change,” said the report.

Speculation tax was also listed in the report.

But it’s too soon to see if the tax will impact Lake Country, said Garost. “I think what will be a bigger concern is if they start to expand… we’ve already seen some changes to it.”

— With files from Tom Fletcher

Request for a new police officer

The District of Lake Country may request for a new police officer.

It has had 12 officers since 2010, according to a report which will be presented during Tuesday night’s regular council meeting.

“The cost of an additional officer for 2018/2019 is expected to be $174,850. The district is responsible for 70 per cent of that cost, so $122,395. The financial plan estimates assessment growth to be 1.5 per cent annually. For 2019 this growth would be $152,223. The growth could support the cost of an additional officer,” said the report.

The report also recommends adding an additional officer before warning signs appear in the district, like an increase in crime.

If approved by council, the officer would not be added until the summer of 2019.

UBCM grant application for Oyama Creek water intake

Lake Country staff is recommending that the district apply for a grant to fund mitigation efforts to the Oyama Creek intake to protect against debris damage.

“The Oyama Creek water intake was compromised during the May 2017 flood event. We were fortunate to be able to design and construct a temporary bypass solution that allowed the water system to remain operable. Improvements to the current infrastructure would minimize the effects of events of this magnitude in the future,” said a report which will be presented to council Tuesday.

The cost estimate for this project is $725,000.

“The Community Emergency Preparedness Fund will fund 100 per cent of the design and construction for structural flood mitigation works, which the proposed improvements at Oyama Creek water intake are eligible for,” said the report.

To report a typo, email: edit@kelownacapnews.com.


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