Housing Action

According to the 2021 census, Canmore has the highest wealth inequality level in the country.

Key factors impacting Canmore include:

• A growing proportion of non-owner-occupied dwellings – substantially higher than provincial average. Statistics Canada data indicates 8% of homes in Alberta are non-owner occupied compared to 26% of homes in Canmore being non-owner occupied.
• An increased proportion of households renting versus owning from 29% in 2011 to 34% in 2021.
• An increased proportion of households spending more than 30% of income on shelter costs.
• Monthly shelter costs have increased by 65% since 2006 and are 37% higher than the Alberta average. Shelter costs for owners include mortgage payments, property tax, and utilities and for renters include rent and utilities.
• Average property values have increased by 80% since 2006 and are twice as high as the Alberta average.

May 2024 Update:

Key actions that will be undertaken to limit the growth of Tourist Homes:

1. Prevent more Tourist Homes from being developed. Administration will be reviewing all statutory planning documents to determine the changes required, the impacts of them, and the process for doing so. The key document that would require amendment is the Land Use Bylaw (LUB).

2. Tax alignment for all Tourist Homes. Amending Bylaw 2013-01 Division of Class 1 Property to eliminate the Tourist Home – Personal Use subclass by fall 2024. This would result in all Tourist Homes classified in the same residential division, being taxed at the same non-residential rate, and the elimination of the current annual Personal Use declaration process.

3. Conversion to residential class options. Develop a process for permanently converting Tourist Homes to the residential class for those owners who no longer want their property to be classified and taxed as a Tourist Home.

4. Regulations and enforcement. Amending Bylaw 2015-02 Business Registry Licensing to require all short-term rentals to acquire, display, and include in all advertising, a valid business license number. Properties not displaying a valid license number would be subject to enforcement, including fines.

These items will be undertaken over the course of 2024. More information will be posted as they are available. 

Accepted Task Force Recommendations:

• Maintain existing tourist homes as a use
  • Tax all tourist homes at the commercial tax rate.
  • Eliminate the “personal use” statutory declaration option for tourist homeowners.
  • Enable tourist homeowners to request to have their tourist home reclassified as residential on a permanent basis.
• Establish a date in the Land Use Bylaw (LUB) after which new tourist homes will not be approved
  • Ensure there is a reasonable period of transition time prior to the effective date for property owners to plan and adjust.
  • As per the guidance in the MGA, honor all development permits issued prior to changes in the LUB coming into force.
  • Follow due process for the amendment of the relevant statutory plans to enable these changes (such as the LUB, MDP or ASP’s) as set out in the MGA including:
    • Notifying any members of the public who may be affected and provide a means for suggestions and representations to be made (MGA 636) and
    • Holding a public hearing before giving second reading to a proposed bylaw to adopt a statutory plan or amendment.
  • The Area Structure Plans in Three Sisters will be separate from all other areas of Town and subject to discussions with the developer.
• Require all tourist homeowners that rent their properties short term to display a business license
  • The license number must be posted in any online advertising of the unit, and there must be a license number posted for each unit.
  • Currently tourist homes are required to have a business license but not required to display it.

June 2024 Update:

Administration is recommending implementing a Permanent Resident Tax program to incentivize full-time/long-term occupancy of homes. The program would:

1. Require residents occupying or renting out their residential properties long-term to declare their status annually.
2. Allow Council to impose penalties and fines for false declarations.
3. Apply proactively, meaning taxes would be assessed on primary residential properties at a rate set for this subclass and all other residential properties could be taxed at a different rate, as decided annually by Council when setting the tax/mill rates.
4. Be implemented under the provisions of section 297 of the MGA, which provides Council with broad discretion to divide residential properties into any number of subclasses on any basis it considers appropriate. This is a provision that expressly allows different taxpayers to be treated differently.

Key actions that will be undertaken to implement the Permanent Resident Tax program:

1. Rewrite Bylaw 2013-01 Division of Class 1 Property to add a Primary Residential subclass by Fall 2024. In order to meet the tight timelines required to implement this program for the 2025 tax year, work has already started on this action and will be done at the same time as the removal of the Tourist Home – Personal Use subclass in the current bylaw. The rewritten bylaw will be brought to Council for adoption.
2. Develop the criteria for the types of housing initiatives revenue from the program can be used to fund, with corresponding amendments to the Reserves Policy.
3. Develop the budget for anticipated revenue from the program and the housing initiatives to be funded from it.
4. Develop the key performance indicators (KPIs) to track the program and its effectiveness, including the necessary data collection and reporting processes.
5. Update the Property Tax Policy to include the Permanent Resident Tax Program and direction to ensure the annual budgeted revenue from the program is charged to the residential properties and not the other classes of properties.

Additional actions will be advanced:

1. Develop the annual primary residence declaration process, including online solutions to simplify and streamline it.
2. Develop the proactive enforcement/audit process.
3. Develop the communications plan to ensure taxpayers are aware of the new program and processes.
4. Determine the mechanism for setting the tax/mill rates for the different classes to ensure the budgeted revenue will be collected.

These items will be undertaken over the course of 2024. More information will be posted as they are available. 

Accepted Task Force Recommendations:

• Implement a “primary residence rebate” program
• Administer as a new “primary residence” property tax subclass:
  • Property owners would need to elect to be classified in the “primary residence rebate” subclass annually, which would exempt them for the higher tax associated with the default residential class.
• Properties would be classified in the “primary residence” subclass if:
  • It is the principal residence of the owner and/or at least one occupant, or
  • A legal accessory building or dwelling unit or secondary suite on the property is occupied as a principal residence.
  • A primary residence could be defined as “the residence in which an individual resides for a longer period of time in a calendar year than any other place.: (BC STR Accommodations Act).
  • Does not apply to tourist homes.
• Explore streamlining this designation with other resident focused benefits (e.g., parking permits) to create a user-friendly process.
• Explore creating an education program for owners seeking to rent out their properties as a primary residence.
• Higher taxes for those who do not qualify for the primary residence subclass should be meaningful
  • Intent is to generate additional revenues for the Town to “improve affordability” in a manner consistent with other jurisdictions.
  • Informed by a strategy with a specific budget, goals, targets and expenditure areas.
  • While there is uncertainty regarding the specific revenue that could be generated, if the Town desired to increase revenues by ~ $2.5 million annually, based on 26% of properties being non-principal residences, this would lead to a residential property tax increase of approximately 50% (i.e., $850 per multi-unit or $1,500 per single detached).
• Potential revenue uses could include but are not limited to:
  • Purchase of property for non-market housing.
  • Funding affordability programs in the community.
  • Incentivise development of accessory buildings or dwelling units.
  • Incentivise purpose-built rental development.
  • Increasing non-market housing supply.
• Budgeting Considerations:
  • Need to develop a program budget.
  • Need to budget for incremental administrative costs.
  • Need to account for this change in the Town’s tax share policy so as not to inadvertently impact residential and non-residential tax share calculations.

Why?

The economics for the private sector to construct rental apartments when land prices are high is extremely challenging, which is why we do not see a lot of it in Canmore. 

Accepted Task Force Recommendations:

• Develop an overarching policy to incentivise rental housing, which would include a breadth of tools – including tax incentives, development, and land supply policies.
• Similar to incentives for full time occupancy, establish clear policy goals and targets to grow purpose built rental supply.
• Through the tax relief or grant authority, adopt a policy that exempts new purpose-built rental properties from 75% of the municipal portion of residential property taxes for up to 10 years.
  • Program can be designed similar to Council’s recent decision in support of 900 Railway Avenue, which included the following conditions:
    • The property remains a long-term residential rental property with a minimum 12-month lease and at least 95% of the units rented to residents of Canmore;
    • Council will be provided an annual report on residency of tenants; and
    • If the property is ever converted from a long-term residential rental property, then the exempted taxes will become immediately due.
  • The policy would apply to new buildings that are not subdivided and include a minimum of rentable units that is yet to be determined but intended to be associated with apartment-style built form as well as smaller densification projects in established neighbourhoods.