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Seniors home hit by costly non-exempt tax ruling

Provincial bureaucracy throws curve

Tags: Excerpts from the Windmill

BURLINGTON, Ontario - Lack of government funding has caused a non-profit senior citizens' complex for low-income Dutch immigrants to loose its property tax-exempt status. Maranatha Home was granted a charitable status by the federal government in 1976 which exempts it from federal taxes. Ontario Ministry of Finance officials reviewed the Home's property tax status since it receives no funding from the government and decided it needed to pay property tax after all. Suddenly strapped with a $102,000 bill, the home appealed to and received from Burlington's city council much needed help.

The ruling, part of the ministry's Regional Market Value Re-Assessment, leaves the 64-unit home with an 18-month property tax burden of $102,000. Ironically, the rent is regulated by Canada Mortgage and Housing Corporation and may only be changed once annually per July 1997. Low income residents at the home receive a rental subsidy which would increase once the monthly rates rise because of the property tax expense.

Under the Ontario Tax Credit program, residents will also become eligible for larger tax credits. Maranatha Home president Arie Hordyk calculates that the property tax change will end up costing taxpayers more money.

Meanwhile, being unable to pay the $102,000 assessment the home appealed requested Burlington city councilors to wave the property tax debt which they did by majority vote. The home also appealed the decision by the Assessment Authority. Meanwhile, the rental rates at Maranatha Home are rising to $540 per month. It will balance the home's budget again but unless the decision is reversed, it will increase the expense to non-subsidized renters with about $90.00 a month.