A grant in the amount of $3,748.26 was approved by Council to the Hinton Legion as reimbursement for 2019 Municipal taxation owing on the organization’s bar portion.
The grant will come from the 2020 Council contingency fund, and is a one time grant to serve as a bridge to help the Legion prepare to pay taxes for the bar portion of the organization each year.
“2019 marked the first year in some time that the Legion received a tax notice for the business portion of their organization,” stated Emily Olsen, interim CAO.
Due to the Hinton Legion not receiving tax notices, the amounts owing for municipal, school, and Evergreens requisitions in total of $5,471 were not collected.
The non-profit portion of any Royal Canadian Legion is exempt of paying taxes according to the Municipal Government Act (MGA), but the Town of Hinton became aware in early 2019 that the bar portion, which is not deemed exempt as it requires a Food & Beverage License for liquor sales, was being written off based on a decision made by the Town several years ago.
That decision lead to tax notices not being received by the Legion.
The Legion was notified that taxes on the bar portion were not being charged appropriately, legislation was not being followed, and that this practise would no longer occur.
A taxation notice was sent to them in May 2019 for the 35 per cent portion of the Legion that provides liquor sales, and this amount would be owing for 2019.
On June 20, 2019 an email was forwarded to Administration from the Legion regarding concerns with the tax notice, stated the town’s report presented at a regular council meeting on Jan. 7.
“There were many years where they weren’t being charged taxation and now all of a sudden they get a notice they have to pay, and rightfully so,” said Mayor Marcel Michaels at the meeting.
He pointed out that it would be in the town’s best interest to acknowledge that it could have been dealt with differently and to refund the town’s portion in order for them to better prepare for future tax payments.
“I know the Legion operates under a tight budget and I would support doing this on a one time basis as a bridge transition for them,” said Coun. Albert Ostashek.
Other communities don’t waive municipal taxes for the business portion of Legions, as it contravenes legislation, the report said.
Legions fall under Municipal Exemption tax codes, as they are exempt by legislation in the MGA, and not the Community Organization and Property Tax Exemption Regulation (COPTER). Non-profits in Hinton that are exempt through the COPTER include the Women’s Shelter, Friendship Centre, Evergreen Foundation, Yellowhead Motorsport Association, and the Food Bank.
Utility right of ways, parks, walkways, the Town Office, and vacant lands that the Town owns are also municipally exempt.
Both Legions in Edson and Whitecourt pay taxation on the licensed portion, and no grants are applied to annual taxation amounts owing, read the report.
The Legion is not eligible to receive Community Grant Program (CGP) funding for operational expenses, as eligible non-profits must be in the first five years of operations.
Since 2016, the Legion received $25,000 for capital projects through the CGP, stated the report.
The Legion is still responsible for the taxation owing for the Schools at $1,552.87 and Evergreens at $169.53.