Tofino is ticking up its business licence fees in an aim to keep up with inflation and help cover rising staff costs without further burdening taxpayers.
The town’s municipal council unanimously approved a 3 per cent increase to business licence fees in 2025 last week, but stopped short of agreeing to their staff’s recommendation of annual 3 per cent hikes in perpetuity.
During their Oct. 22 regular meeting, council received a presentation from Bylaw Services Supervisor Kiera Tak who explained the 3 per cent increase broke down to 2 per cent to handle inflationary costs and 1 per cent to cover increases in expenses.
“The increases will reduce the pressure on property taxation as costs rise,” Tak said, adding that the projected 3 per cent increase is estimated to reduce the tax burden by approximately $10,500 in 2025.
Prior to their decision, council heard from Tofino Long Beach Chamber of Commerce executive director Samantha Hackett who suggested more conversation should be had with the local business community before implementing a 3 per cent hike.
“In this case, the chamber hasn’t had sufficient time I’ll be honest, to discuss this thoroughly with staff or our local business community to really contribute meaningfully to this discussion,” Hackett said. “We, of course, understand the need for regular fee adjustments. It’s very important to distinguish between what we think is a reasonable increase and those that can impose an undue burden.”
She suggested a 1-2 per cent increase “might be acceptable” but a 3 per cent increase would require further consultation.
“As part of our last minute review that we undertook for tonight’s meeting, we noticed that the business licence fees in other communities, such as Nanaimo are $165, Port Alberni, $132, they are considerably lower than what is being considered here,” she said, adding Ucluelet charges $177 and Whistler charges $190.
“Our local businesses, as you all know, are already adjusting to the recent significant increases in their utility rates and additional increases in costs further strains them.”
She noted that the district’s strategic plan highlights the “strong creative and entrepreneurial spirit that defines Tofino.”
“We absolutely agree and this is vital that we do not stifle this energy or discourage businesses from operating openly and proudly within our community by imposing excessive financial pressure,” she said.
Tofino’s fees vary depending on the type of business, with licenced full-service restaurants costing $367, short-term rental accommodations costing $220 and commercial retail shops ranging from $220 for under 300 sq. feet and $587 for over 300 sq. feet.
Hackett said she was willing to collaborate with the district to establish a business licence process that would support entrepreneurs and foster long-term economic stability.
“I have a lot of ideas to strengthen both the process and the business community overall. By supporting and uplifting our businesses who not only are vital to our economy but also the residents of the community, we can ensure Tofino thrives,” she said.
Tofino saw a massive 20 per cent hike in business licence fees in 2022 after they had remained stagnant since 2000. That 20 per cent hike was followed by 2 per cent increases in 2023 and 2024.
Tak said setting perpetual 3 per cent increases each year moving forward would “reduce the administrative burden of amending the bylaw each time the fee schedule is out of date” and that the updated fees would be communicated through the annual business licence renewal process.
Coun. Tom Stere asked about the service provided with the fees and the staff time involved with business licences.
“They pay a fee, they must receive a service. I’m just curious as to what that is,” he said.
Tak responded that business licence applications involve “significant work” for district staff to ensure licence holders are operating in compliance with local bylaws.
Coun. Kat Thomas pushed further on the services licence holders receive, suggesting that current holders simply renew their licences without inspections.
“I know through many of our conversations about short term rentals in particular, we learned that there was no follow up inspection when they were renewing,” she said. “If a business renews their business licence, we know short term rentals, which is a big chunk of some of our businesses, they are not getting any of those services that we are mentioning here. So, should there be a reduction in fees for people that are renewing or is there a plan to increase the level of service for these businesses?”
Tak responded that while there are no inspections attached to licence renewals, staff can inspect businesses at any time to ensure compliance and current holders avoid some of the startup fees associated with business licences.
“A new business has to pay fees for a new business licence application and then, going forward, you just have your annual business licence fee for your business class,” she said.
Director of Community Services April Froment reiterated that 2022’s 20 per cent hike came after 22 years of no increases.
Mayor Dan Law agreed.
“We didn’t have a business licence increase to even cover basic inflation for over 20 years. Basically, what happens in that situation is that the taxpayers and the district pay more and more and more every year and the businesses pay less,” he said.
Coun. Duncan McMaster also supported the increase.
“I think there’s members of the public who’d be upset if taxes went up, which I’m sure they will year after year, and business licences didn’t go up,” he said.
Thomas spoke against the idea of locking in perpetual 3 per cent hikes.
“I can understand staff arguing for a 3 per cent increase now, perhaps, if there is services that they can say are being provided. I don’t feel great about it, hearing the level of service that is provided and some of the gaps that might be there and I can’t support this being in perpetuity,” she said.
She added that local businesses already have a number of expenses to cover and perpetual increases would compound over time.
“If this is covering the service fees for the businesses, then we need to be able to see that. If this is just covering bylaw in general, I don’t think the onus should necessarily be on businesses to be paying business fees to have beach fires monitored,” she said.
Coun. Sarah Sloman suggested council hold off on making a decision to allow further discussion with the business community as Hackett had recommended.
Stere also noted Hackett’s presentation and agreed with Thomas that perpetual increases were a tough sell.
“I’m concerned about the increased costs for businesses in small towns, especially with some of the fiscal realities of working in this town,” he said. “That is 3 per cent compounded over time, so it does add up. My concern is once again that perpetuity in terms of that 3 per cent…I am uncomfortable with perpetuity in terms of the increase.
Stere also agreed with Sloman that more time to engage with business owners would be beneficial.
“If there is no immediacy to it, then I would like a little consultation with the business community,” he said.
Froment responded that the fees for 2025 needed to be set and district CAO Nyla Attiana confirmed that there was little time to delay the decision.
Attiana explained the fee increase was not to cover additional services, but rather to help cover the bylaw department’s budget and rising staff costs.
She suggested the bylaw department’s budget is around $546,000 with about $200,000 of that being paid through property taxation and added the lion’s share of that budget consists of staff salaries at around $400,000.
“Not all of that enforcement cost relates back to business licencing, but a portion of that does and we do need to provide that cost of service,” she said. “This is not a request to increase fees to increase service levels, this is to keep up with rising costs.”
She suggested those rising costs should not always fall on taxpayers.
“We do need to set fees and time is of the essence. I do wish I came to council earlier so we could have the fulsome discussion that council is looking for today,” she said, suggesting council could put the 3 per cent increase in place for 2025 and review it before 2026.
Council liked that idea and unanimously agreed to set the increase at 3 per cent for 2025 and to review the fees again prior to 2026.
