Wabana mayor says move necessary to avoid budget deficit
The Town of Wabana on Bell Island hopes to settle some outstanding property tax issues shortly by exercising its right to auction off those properties.
A view of the docking wharf area at the entrance to Bell Island as seen from the top passenger deck of the M/V Flanders after leaving Bell Island to sail across The Tickle to Portugal Cove. - Photo by Joe Gibbons/The Telegram
A total of 12 properties will be the subject of a live auction scheduled for Aug. 15 at the Wabana Complex. All are considered to be in arrears and have been accumulating debt over several years, according to Mayor Gary Gosine.
“Some abandoned, some just don’t want to pay ... so we’ve got no other choice but to try to auction off to recoup some of our money back.”
With a budget for the current fiscal year set at $2.5 million, Gosine said the town aims to collect 90 per cent of taxes owed any given year. Doing so helps the town avoid operating with a budget deficit. Local taxes and fees account for approximately 80 per cent of its revenue to cover the budget.
There are approximately 300 accounts linked to properties within the town of 3,000, and approximately 20 per cent of those accounts required extra attention this year. The town hired two people in May to focus specifically on collections.
“The Town of Wabana is not unlike any other municipality that has property owners who need encouragement to pay their taxes,” said the mayor. “Those that fall behind for extended periods require extra attention. If these citizens are not addressed in paying their taxes, they end up paying more if there’s bad-debt expenses.”
The Municipalities Acts gives towns like Wabana the right to auction property to settle overdue taxes. A collection agency can be used through a referral, with that agency able to pocket some of the proceeds collected. Water service can also be cut.
“For certain water cutoffs, before the letter is in the through the door we’re getting calls and making arrangements,” said Gosine.
In preparing for the auction, the town employs lawyers to conduct legal searches and look at surveys. An auction cannot go ahead if the owner for a specific property is unknown.