Financial Matters:

2019 Tax Sale Update

As a result of the 2019 tax sale proceedings, Administration was successful in collecting just over $1,040,100 in outstanding property taxes ($802,400 relating to the properties redeemed and $237,700 for the nine (9) properties sold). It should be noted that the collection of the arrears is not considered to be new funding for the City but rather a repayment of a loan effectively made to property owners who did not remit payment on the prescribed due dates. At a minimum, the lowest possible tender is equivalent to the cancellation price (defined as the total amount of tax arrears, including any other charges that have been added and are considered a priority lien, plus an administrative fee) at the time of the sale.

Regarding the properties that did sell at tax sale, excess funds in the amount of $402,218 were received as a result of tender bids being above the cancellation price. These funds are required to be placed with the Courts for subsequent distribution. Application to the Courts can be made by the property owners or those with registered interests in the property to receive the excess funds. For those properties where registrations were placed prior to January 1, 2018, after one-year, should these funds still be available, the City may make application on its own to the Courts for the funds which would be considered wind-fall revenue in the year received. As a result of changes in the legislation for registrations after January 1, 2018, municipalities are no longer able to apply for excess funds. These funds now remain with the Courts for a period of 10 years after which the funds revert to the Province.

In 2019, the City was able to recover approx. $97,000 from monies which remained unclaimed. There is currently a balance of $1,025,000, inclusive of amounts added in 2019 which have been placed with the courts and will potentially be eligible for redemptions by the City in future. Until such time as an application is submitted, Administration will not know if any funds remain. In accordance with the Ontario Municipal Act, these funds are taken into general revenue when received. By way of Council direction, these funds are then transferred to the Property Acquisition through Vesting capital project (ID# 7171059) to assist in offsetting the annual maintenance of properties which have been vested by the City.

Consultations:

During the tax sale process, all properties are vetted for municipal considerations by Administration through a number of City Departments, including but not limited to: Planning, Office of the City Solicitor, Real Estate Division, Parks, Fire, and Building.

Conclusion:

Administration is planning to hold two (2) tax sales during 2020 for the twenty-six (26) eligible properties. Each of the property owners on title has been notified by Administration on several occasions and have not responded to our efforts to collect or have been unable to pay the outstanding balances. The number of properties actually proceeding to sale will likely be reduced as owners or interested parties come forward and make payment in order to retain their property and/or other relevant facts are