The city will have to make a "significant" repayment of property taxes to Canadian Tire and other big box stores in the near future.
In some cases those property tax overpayments date back eight years.
But James Krauter, the city's Manager of Taxation and Revenue, said that City Hall has been aware of the situation working its way through the system for several years and that money to repay the property taxes is already accounted for in the current city budget.
"There are contingencies built into the budget process," Krauter said in an interview. "It's been on our radar. We knew what was out there on the basis of appeals."
Krauter was reluctant to say just how much the city will be ordered to pay back until the final ruling from the Municipal Property Assessment Corporation's assessment review board is handed down and City Council has been notified.
"Nothing's finalized yet. The assessment review board hasn't signed off yet," Krauter said in an interview.
He did say it was "a much lower impact" than the $1.24 million the City of
"Every municipality across
"Is it affecting us like other municipalities? No, it's not, because the great thing about Guelph is that it has a very diverse assessment base. Because of that, we can mitigate any issues we might have."
Canadian Tire will be the biggest winner in the reassessment. He said other big box stores that have appealed their property taxes, such as Home Depot, will be getting much smaller amounts. An appeal by Costco "will probably be withdrawn."
The city's budget takes into account the tax assessment write-off, Krauter said.
Big box stores have been challenging their property tax assessments across
Krauter said in Canadian Tire's case, "they believe their buildings don't have the life span at what the were assessed at."
Land values, whether they are part of a plaza, tenant-based as opposed to ownership and building life cycles are all part of the assessment process, Krauter said.
"It's not unusual at all" for a company to challenge its tax assessment, Krauter said. What creates a bit of a situation is that the city will have to repay overpayments of up to eight years.
"Even if it's a relatively small amount, when you times it by eight years - that's where it gets much bigger," Krauter said.
MPAC is working on making the process move quicker, he said, which would definitely help municipalities.
Money ordered returned to the appellants would be in the form of a property tax credit, Krauter said.