WHEREAS the administration of the Vacant Unit Tax (VUT) is an unparalleled annual bureaucratic burden on over 330,000 Ottawa households; and
WHEREAS over 330,000 households were threatened with a late filing penalty of $250, and a fine of up to $10,000; and
WHEREAS preliminary reporting from staff, found that 12,980 Ottawa households declared after the deadline, and were it not waived for 2023, would have paid roughly $3.2 million in fines; and
WHEREAS the VUT is the only tax or service administered by the City of Ottawa that subjects a yearly, reverse-onus requirement on all residential property owners; and
WHEREAS the VUT disadvantages seniors, snowbirds, deployed military service personnel, those with disabilities, new Canadians, those with limited access to computers and/or the internet, and many other vulnerable groups; as the annual declarations apply strict timelines, and are required to be primarily made online, with only limited options made available for accessibility or those who cannot access the internet; and
WHEREAS City Councillors have heard from residents who were blindsided by having the VUT applied to them, including: seniors on short stays at retirement facilities; residents who are downsizing, but require time to go through a lifetime’s worth of possessions; those with family-owned cottages no longer classified as such due to development sprawl; and rural residents with longtime abandoned structures on their properties; and
WHEREAS in the Vacant Unit Tax report approved by Council in 2022, the document establishing the Vacant Unit Tax in Ottawa, stated that staff:
…attempted to estimate the number of properties that would be vacant using various approaches and data sources. These approaches all suggest that the number of vacant properties in Ottawa subject to the residential vacant unit tax would be between 0.5% and 0.75% of the 330,000 eligible units. In Vancouver, 1% of the eligible properties are subject to the tax. Toronto expects the tax to apply to 1% of their units. Using Vancouver's results as a proxy for measurement, staff adjusted the results for multiple factors, such as the balance between condo apartment units and single dwellings; and
WHEREAS further within that report, staff anticipated a vacancy rate of 0.5%, citing the demographics, differences of the Ottawa market, and staff further noted that property speculation has not been as prevalent in Ottawa compared to Vancouver and Toronto; and,
WHEREAS Vancouver, recognized as the Canadian city with the most serious concerns regarding vacant units, only had 2,193 of vacant units out of 186,000 of total units, roughly 1%, in its first year of a VUT; and
WHEREAS Toronto’s VUT, in its first year, found that of 775,000 households, only 2,100 units were vacant, roughly 0.27%; and
WHEREAS Staff’s data and estimation for the number of vacant units in Ottawa was around 1,650; and
WHEREAS preliminary numbers from staff shared that, out of 336,865 units, a whopping 3,268 units were declared vacant under Ottawa’s VUT criteria, producing a declared vacancy rate of 0.97%; and
WHEREAS a further 2,836 properties were deemed vacant by staff, bringing the total number of vacant units to 6,104, a rate of 1.8%; nearly double that of Vancouver, 4.3 times that of Toronto, and over triple staff’s original predictions; and
WHEREAS even if all 1,909 Notices of Complaint currently filed were successful, that still leaves Ottawa with a vacancy rate somehow 250% higher than staff’s predications; contrasted against Vancouver and Toronto, where staff overestimated vacancy rates; and
WHEREAS either Ottawa is Canada’s most vacant city by orders of magnitude, or more realistically, the VUT is being improperly applied to Ottawa residents; and,
THEREFORE BE IT RESOLVED THAT the Vacant Unit Tax (By-law No. 2022-135) be rescinded effective January 1, 2024 and no VUT be applied to properties for the 2023 tax year.