Comment 32371

By JonC (registered) | Posted July 10, 2009 at 10:20:10

"The only people being subsidized are the people with low assessment values and most of these homes are downtown Hamilton. The average downtown home pays $2,442 per year in property taxes, while people on the mountain pay $3,367 and people in the west end pay $3,902."

Well Mr. Smith, since the purpose of housing is hold a number of people, houses on the mountain must hold 3367/2442 times the number of people in a house downtown. Otherwise the free market doesn't make any sense and people are throwing a hundred thousand dollars away for no good reason.

"It will only take 5 years for that figure to be paid back by their higher assessment values. After that 5 year period, the city benefits to the tune of $1,500 per year by having a new home, rather than relying on low value downtown homes."

Again, they must have 3367/2442 times the average people, so to higher tax levy reflects that the the average house on the mountain has more residents consuming services and infrastructure.

"These are the people who have been working on Hamilton's sewers recently, tell me that they are not in the business of repairing existing pipes, rather than just building new ones."

Yes at some point in a product's lifetime replacement becomes cheaper than repair, that's basic economics, so when it's cheaper to repair, the tax money goes to repairs and when it's cheaper to replace, that's where it goes.

"When people buy stuff at a new store, they are not charged a "new store fee" on top of whatever it is that they're purchasing, rather ALL customers pay that cost when it is factored into the final price. Each customer only pays the average price of what they consume."

That is true, and a poor analogy since in it ALL customers go from 0 products to X products and they all are sharing in the cost of construction. In what we're talking about existing homes already have X products, so in your analogy, the new store would come to your home and demand money for the product you already have.

"The development fee should reflect the cost of new infrastructure that is built as a direct result of the new homes, no more, no less."

I agree, which is why they should increase the development cost immediately.

"Thus, if the city needs to increase water capacity by 5% due greater demand from new homes, this cost should come out of the general revenue stream that comes for selling water services to the people of Hamilton, not just the new customers."

So you want to INCREASE YOUR TAXES to subsidize increased pumping capacity. Just to clarify what's happening, in case maybe this is the issue, is that the existing city, while overburdened due to not increasing development fees, is okay. It's not that they need to tear everything down or that the whole works is about to rust out. We're at capacity and to expand capacity, which if you know anything about plumbing increases with distance, new infrastructure, in addition to what is already there, needs to be built. I just want to make sure we're on the same page.

"If you were the last person to move to Hamilton, right before water capacity went over 100%, should you have to pay for the fixed costs associated with building new capacity? What if you were the 10th to last person, how about then?"

This is why the development fees should have been increased years ago, so that we would never be at 100% capacity. I also note that you haven't addressed Oakville's fee being twice Hamilton's Are they completely ripping off new developers. Especially since they will be recouping even more property tax from those homeowners than Hamiltonian's pay.

"The fact that you moved to Hamilton at all means you strained the capacity, does it really matter if you were the exact person who pushed it over 100%?"

I bought an existing home, so I strained nothing.

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