IBC property tax break a bad idea
The Inuit Broadcasting Corp. recently appeared before Iqaluit City Council to pitch the idea of a five-year property tax exemption for a new $10 million “broadcast centre” they’re planning to build on a piece of Inuit-owned land off Iqaluit’s Federal Road.
If city councillors wish to serve the public interest, they have no choice but to say no to this request — and there are at least six good reasons for doing so:
• IBC is a private organization that does not publish annual reports or consolidated financial statements. This means it’s impossible for Iqaluit City Council to accurately assess the organization’s financial position and verify any claims IBC makes about the need for a property tax exemption.
• IBC, in effect, wants a municipal government to supply it with a subsidy. equal to five years of foregone property taxes. But municipal governments in Nunavut, and pretty much everywhere else in Canada, are not responsible for subidizing private broadcasters. It’s not the City of Iqaluit’s job.
• If Iqaluit city council were to grant IBC’s request, it would be impossible for them to calculate how much revenue the city government would lose. That’s because of the way in which property tax bills are calculated. In the first step, a GN assessor gives the property an assessed value. In the second step, the city calculates a mill rate, based on its financial position within the given financial year. Since the proposed building doesn’t yet exist, none of this can be done. City councillors should not vote to give away revenues whose amounts cannot be calculated.
• The City of Iqaluit still copes with many expensive problems, especially in infrastructure and senior management. Iqaluit’s aging municipal swimming pool and municipal office building must soon be replaced. Now is not the time to give away tax revenue.
• This October, voters in Iqaluit will be asked to elect a mayor and new council. The current council should not impose any unneccessary financial decisions on future city councils that have yet to be elected.
• If Iqaluit city council were to grant IBC’s request, more supplicants would surely follow, asking for the same thing.
If IBC’s project fits the city’s general plan and zoning bylaw, then it should proceed as planned. But there’s nothing in the project to justify a property tax exemption.
Besides, if IBC’s Iqaluit building project does suffer from financial weaknesses, there are better places to seek help.
Between the four of them, Nunavut Tunngavik Inc. and its three regional associations consume between $65 and $70 million a year’s worth of investment earnings from the Nunavut Trust.
They’ve used this cash to build a big, bloated bureaucracy that now stretches across Nunavut. On its own, NTI spends more per year on salaries and benefits for its 90 to 95 staff members — about $10 million — than the Nunavut government spends to run its entire culture and language department.
NTI gives the regional associations about $15 million a year,. They use it pay for many services and functions that appear to duplicate what NTI does. The big Tunngavik spends the the rest on itself, as well as on a few programs, most of them mandated by the land claim agreement.
IBC, on the other hand, claims a small annual budget of between $2.5 and $3.5 million. And its board of directors is made up of names who appear to represent NTI and the three regional associations. This implies a strong client-patron relationship, at the very least.
So if IBC needs more help, they should turn to NTI and its three regional organizations, not the City of Iqaluit.
If NTI can afford to buy into a private uranium firm, they can afford to buy into a private broadcaster whose board membership they already control. JB