Rossland Yards is expected to be completed by December 2022, and available as affordable housing to qualified tenants. Photo: Jim Bailey

Rossland Yards is expected to be completed by December 2022, and available as affordable housing to qualified tenants. Photo: Jim Bailey

Rossland Yards receives short term tax exemption

City of Rossland ensures rent remains affordable at new 37-unit housing complex

Rossland city council agreed to make Rossland Yards affordable housing complex more affordable at its meeting Monday, Aug. 8.

Lower Columbia Affordable Housing Society president Jan Morton made a request for a preferred tax exemption in a presentation that showed how a short term tax break would help the 37-unit housing complex get on its proverbial feet, particularly in light of increasing mortgage rates and living expenses.

“The request of that full package of scaled exemptions will set the operations of Rossland Yards on solid ground, ensuring the long term sustainability of this really exciting building,” said Morton.

Permissive tax exemptions absolves property owners from paying municipal tax and all other tax levies from other authorities. LCAHS proposed a full tax exemption in year one, then annual tax increases by increments of 25 per cent for the next four years, to get to 100 per cent payment in year five.

The total impact to the city’s coffers would be almost $50,000 in the first year, 2023, and $136,000 in total over five years, but would allow LCAHS, the operators of the building, to keep rental rates affordable.

“Even with that very, very careful planning the reality of operating affordable housing is that the margins are razor thin,” said Morton. “And that is particularly so in the initial years.”

Construction of Rossland Yards is expected to come in as budgeted albeit using up the full contingency fund. Its estimated completion date is December 2022.

The LCAHS will assess applications for occupancy for working households with incomes of between $40,000 to $70,000. Without a short term tax exemption, rents would have had to be increased to levels of affordability for annual household incomes between $50,000 and $80,000. In some cases, it would mean an increase of more than $200 per month.

In addition, the LCAHS would also have to deal with a measure of uncertainty when first opening a brand new 37-unit complex that relies completely on rent from capable renters.

“Some of those factors in the early stage is that a full and stable occupancy does not occur overnight,” said Morton. “Clearly in 2023 it will take us a while to fill the building, assuming we stick with the criteria.

“Commissioning a new building comes with unexpected costs,” she added. “It is really important we establish healthy replacement and building reserves so that in year 10, 15 or 20 we can replace that roof or repave that parking lot.”

In council’s discussion on whether to approve the permissive tax exemption, Coun. Janice Nightingale said she likes the project but questioned whether the city should approve it, given the uncertainty of mortgage rates, and that all other Rossland households are obliged to pay taxes, even low income residents.

Coun. Chris Bowman supported the tax exemption saying that the 56 units LCAHS has provided in Greater Trail is still nowhere near enough.

“I know first hand what some of the things people are facing, so I applaud what the Lower Columbia Affordable Housing Society has done thus far and in effort to make us as attractive as we are right now … we need to fight to keep those rents down and fight to keep that money coming in from the province.”

The City of Rossland, the LCAHS, BC Housing and Columbia Basin Trust partnered to build the four storey mixed-use building on the western portion of the vacant site located at 3rd Avenue and Spokane Street in Rossland and accessed over $7.6M in grant funding.

The building will have 37 units of rental housing on the second, third and fourth floors. The ground floor will be the Rossland City Hall. The residential portion of the building will be managed by the LCAHS.

The building has also been designed to high standards of energy efficiency and sustainability.

The residential portion of the building will have 21 one bedroom units, 12 two bedroom units and four three bedroom units.

Council approved the preferred tax exemption request by a vote of 6-1 with only Nightingale against.

Read: Name selected for Rossland City Hall/affordable housing project