A new tax assessment classification for what will now be a vegetable growing facility for Bevo Farms will lower that bill so much that it cancels out all other assessment growth expected in Medicine Hat for 2025.--NEWS FILE PHOTO
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The conversion of the Aurora Sun cannabis greenhouse toward growing flowers and cukes – and the subsequent change in tax status – could negate all other assessment growth in the city for 2025.
City finance officials presented estimates to council members on Tuesday for the coming two-year budget, including forecasts of tax increases and assessment changes.
They expect the value of the assessment base to remain stagnant in 2025, then grow by just 0.5 per cent in 2026.
Coun. Andy McGrogan requested a further explanation of the estimates, calling the outlook “grim.”
“We are seeing a number of things in our planning that suggest a slowdown of development in the city,” said Aaron Hoimyr, the city’s accounting supervisor who has led budget presentations. “As well, some things that were taxable may not be.”
That doesn’t mean there will be a freeze of new construction in 2025, he said.
“Overall we expect a zero net.”
That almost certainly relates to Bevo Farms’ application for reassessment of its million-square-foot facility in the Box Springs Business Park as a vegetable and flower growing operation. That will put it in the “farm” classification, as opposed to the facility’s previous “non-residential” or commercial status as a cannabis grower.
Last spring, Bevo Farms made a formal request to council to accelerate a reclassification to the lower farm rate, and decrease its $750,000 per year tax bill.
Council denied the request on recommendation from assessment staff who said the change would happen when accessors update the tax roll for 2025.
Each year a portion of requested tax revenue increase is assumed by new buildings or improvements to existing properties. That new value is factored in as mill rates are adjusted.
For example, for 2024, the budget called for a 5 per cent municipal tax increase, but new additions to the tax roll were 0.7 per cent.
That left existing taxpayers with a tax increase of 4.3 per cent on the municipal portion of their bills.
