Oshawa Finance Committee has recommended that Canadian Automotive Museum (CAM) request reclassification to a tax exempt status, for the city portion of its property tax.
A copy of the report obtained by Durham Post, and to be presented tomorrow (April 19), also recommended that CAM should contact the Region of Durham and School Boards that include Oshawa in their jurisdiction, requesting they provide a grant or other financial assistance to offset the property tax payable to them by the CAM.
Property taxes billed by the City of Oshawa are apportioned, with 41 per cent retained by the City, 41 per cent remitted to the Region, and the remaining 18 per cent remitted to the Province.
The report said should Oshawa Council propose financial support to CAM for property taxes, it is important to note that in 2021, the amount of property taxes, after the application of the charity rebate and partnership grant, which was retained by the City from CAM amounted to less than $300. Any grant funding provided over and above the reductions that are already in place for the Canadian Automotive Museum, specific to property taxes, would effectively mean that the city is funding the tax levies from the Region of Durham and the Province.
2023 Budget
Any consideration by council of providing additional grants to the Canadian Automotive Museum should be referred to the 2023 budget process.
The report says throughout the month of January, the city received several pieces of correspondence focused on increasing funding support from the city to the museum citing its historical importance.
Campaigners on behalf of CAM have been requesting exemption from tax or a grant equalling the total annual tax. They have concerns the museum may be won over by competing municipalities offering better facilities and funding. In the 1970s, grants to CAM were approximately $10,000 a year growing to some $20,000 in the mid-1980s to the mid-1990s. The funding increased further to $25,000 from 1994–1997. The city did not provide any funding to the museum between 1998 and 2014 nor did CAM request funding from the city. From 2015-2022, with the exception of a capital grant in 2017, the city has provided the Canadian Automotive Museum with a Partnership Grant in the amount of $5,000 a year.
The museum was founded in 1962 by a group of Oshawa businessmen through the Oshawa Chamber of Commerce. The venture was initiated mainly to preserve the automotive history of Canada in Oshawa, and has been in operation since 1963 at the nearly century-old former car dealership building at 99 Simcoe St. South.
CAM Financial Statements
The 2020 financial statements of CAM showed a net income of about $9,800. The Canadian Automotive Museum is primarily funded through grants and government assistance augmented by donations, admissions, parking rental and other miscellaneous revenues, said the report.
It pointed out that there are two programs in which the Canadian Automotive Museum could be eligible to receive a reduction in the amount of property tax levied on an annual basis.
- Heritage Rebate Program: The City of Oshawa has a Heritage Property Tax Reduction Program (By-law 106-2011). This program provides owners of properties designated under the Ontario Heritage Act the opportunity to apply for a tax reduction. The amount of the annual tax reduction received is 40 per cent of the City and School Board portions of the taxes payable on an eligible heritage property. Regional taxes are not included in this program. Although the Canadian Automotive Museum building is roughly 100 years old, it is not a designated heritage building. In order to receive this rebate the Canadian Automotive Museum would need to go through a formal process to receive a designation under the Ontario Heritage Act.
- Charity Rebate Program: Registered charities are eligible for a property tax rebate equal to 40 per cent of the City, Region and School Board taxes payable for space that is occupied in a commercial or industrial class of property.
However, it is not permissible to combine the Heritage Rebate and Charity Rebate Programs, according to Section 361 of the Municipal Act. Organizations are able to receive one program or the other but not both. Currently the Canadian Automotive Museum receives the Charity Rebate which is the more advantageous program of the two relief options available. Should the Canadian Automotive Museum receive a heritage designation it would not yield any further reductions to their annual property taxes.
The report said CAM may qualify for the External Agency Program, which provides budget funding to various organizations that offer services that are consistent with and support core city services. In most cases, the city owns the facilities in which the organizations operate. “The Canadian Automotive Museum may qualify for a funding under the new grant program once the criteria are established and adopted by the Finance Committee and Council,” said the report.
The report said through discussions, it was indicated that the funding requirements to support the museum were not capital in nature but rather on-going funding to cover property taxes, staffing and other operating costs.