CANADA: Ottawa Defers Property Taxes For Poor Seniors

OTTAWA, Ontario (CBC News), October 15, 2007: A new Ottawa program will allow low-income seniors and disabled residents who own homes in Ottawa to put off paying their property taxes until they sell the property or earn more money. The property tax deferral program launched Monday by the city and billed as the first of its kind in Ontario is intended to help "house-rich, cash-poor" seniors and people with disabilities stay in their homes longer, said Coun. Peter Hume. He helped initiate the program after talking to seniors about the financial challenges they face. Under the program, qualifying homeowners with a gross household income under $35,000 would be charged only five per cent interest each year on the deferred amount instead of the 15 per cent interest usually charged to homeowners who fail to pay their taxes. To qualify, the residents would have to be eligible for benefits under one of the following: * The federal Guaranteed Income Supplement program. * The Ontario Guaranteed Annual Income System. * The Ontario Disability Support Program. Mayor Larry O'Brien said the program could give some Ottawa families a few thousand extra dollars a year to spend. "Ensuring that you can remain in your homes is important to maintaining a healthy, vibrant and wonderful city," O'Brien said at a news conference. He estimated that the money would have little effect on the city's finances, as it will be collected once the homeowner sells the home or no longer meets eligibility criteria. "On a city that has a $2.3-billion budget," he added, "this level of money that we're talking about here gets lost in the rounding." According to Coun. Alex Cullen, the average property tax bill in Ottawa is around $3,500 a year. He estimates about 6,900 Ottawa households in Ottawa would qualify for the program. However, in similar programs in other provinces, only about a fifth of those who qualify actually take advantage of the program. That means the city expects about $5 million in property taxes to be deferred annually. Copyright © CBC 2007