$132,000 tax break goes to Sahotas for providing “urban farm” space

astoria-lots
Empty lots beside the Astoria Hotel are owned by the Sahota family – click for larger image

Downtown Eastside landlords notorious for owning troubled SRO hotels may be the next commercial land owners in Vancouver to get a whopping tax break by designating property as a community garden.

The Sahota family who own the Astoria Hotel on East Hastings Street through a company (Yang-Myung Holdings Ltd.) are benefiting from a program that allows commercial properties to be re-classified as a public park or garden. The so-called “Class 8” property classification permits owners of commercial property to pay one-fifth of their normal tax bill.

Tax breaks totaling in the millions of dollars have been given to developers and commercial property owners during a year where the City of Vancouver is facing a multi-million dollar budget shortfall, is reducing staff positions and closing city facilities as a result.

The Sahotas were approached about using their property by a community organization named Greening the Inner-City looking to create an “urban farm” to train up to a dozen area citizens as food gardeners.

Empty lots beside the Astoria Hotel (769 East Hastings) to Hawks Avenue have an assessed value of $8.3 million. The normal tax bill would be approximately $165,000. As a Class 8 property the tax bill could be reduced to as low as $33,000, providing an annual savings of $132,000.

The Astoria Hotel has been the centre of several complaints by tenants over the years. Vision Vancouver councillor Tim Stevenson has referred to the Sahotas as “slumlords,” and some have said they’re the "worst" in the city.

The BC Assessment Authority (BCAA) is an independent government body that decides property values throughout the province. Cities must tax properties based upon their assessment.

Deputy Assessor Grant McDonald says that there is an “element of subjectivity” in the rulings of BCAA. “Once the garden is set up we need evidence that the community group is in there working the garden,” says McDonald. “We’ll be back next summer to confirm this.”

Asked whether the City of Vancouver is disputing any of BCAA’s rulings, McDonald would only say that he’s “had conversations” with City staff on the matter. The BCAA will announce their ruling on the Sahota property on December 4th.

City staff have the option to recommend that the several development sites and commercial properties are not suitable locations for community gardens, leaving the final decision to axe or move the gardens to city council. Sources say no plan is pending to review community gardens on commercial land by the City.

The City of Vancouver has asked community groups to use vacant public lots for their gardens, and many are still available for applicants. It is hard to imagine that Mayor Gregor Robertson, whose own showy community garden project practically defines his first year in office, would even consider removing one of these expensive vegetable patches.

Vancouver Courier columnist Allen Garr has done great work on this subject earlier in the year. What makes the Sahota property precedent-setting is that the land is not currently slated for development. In the case of one of the lots, a parking lot for the Astoria Hotel was turned into a garden, leaving Hotel staff to park on the street.

Wood for the community gardens was provided by Rona, who probably will not get the kind of property tax break these landowners are getting for their generosity.

Check out our new online poll on this subject and let us know what you think.

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  • jamie

    This is getting ridiculous – these green weed patches popping up everywhere….in the name of developer tax breaks….I am surprised homeowners arent threatenting to sue the City as a violation of their rights if they had a huge garden if they too could get tax breaks on their residences….(Since the city is scared of being sued,.,.mma story)
    WHen they first started popping up I thought it was aploy to beautify a few ugly corners of very visible land in time for the olympics…(maybe it is)
    but honestly how much stuff or edible food is coming out of these “patches”
    Go watch the new movie “Food inc” if you want to know how your crops are being grown and and the latest technology has made the seeds immune to chemicals..so our crops / food is sprayed soo much to kill teh competing weeds and other growth but no one is talking about this and the associated run off of all these chemicals on thousands of acres of land….flowing into the rivers and oceans….(wonder if that is where the fish went)…well if these small city patches produced and werenot such a facade that would be great….SOme are so full of weeds (and overgrown sunflower plants) what about inseason vegetables…heck we may as well turn them into greenhouses to extend the growing season from 6-12 months…now there is an idea…if realestate ppl like the sahotas are benefiting from this it is absolutely laughable….and the bcaa is only giving this “consideration” and play is because the requests / ideas came from government – not joe citizen…..

  • james

    Tough to find a perfect solution, $132,000/yr will lease acres & acres of better farmland elsewhere, but help with a few troubles in the downtown eastside saves much money too.

  • Sharon

    residents should sue?… what for. You need to understand how property taxation works. The city is not out a penny. Residents are not required to pay one penny more either. The rest of Class 6 – the corner store, the bakery, the supermarket the office building, all get to pick up whatever tax load that these guys managed to unload.
    This is a BC Assessment loophole that needs to be plugged. I can appreciate the desire by a property owner to reduce tax exposure but let’s be clear about who is getting the shaft in the process.

  • concerned

    If council wants to put a halt to the loss of all this money, all they have to do is pass a bylaw not permitting the use of this land for community gardens. Quite simple. Do you think Gregor is going to do that? Not a chance. The Hollyhock folks love all these gardens popping up everwhere throughout the city. Even if it costs millions in foregone revenue. BC assessment really has no choice but to classify the land for what it is being used for. If council wants to put a halt to this, they can. But they won’t, cause they want more veggie gardens popping up on expensive land. All this money could have been used to help balanced the budget, save jobs and the petting zoo.

  • Sharon

    concerned, there is NO LOST REVENUE to the city – all that happens is that the taxpaper pie gets sliced differently. Same pie, just different sized slices.

  • P

    This is vacant land consuming no municipal services. They are still paying hundreds of thousand in property taxes in class 8″parks and gardens” One could also argue they should be 100% exempt from taxes given these property owners are fufilling the mandate of civic government.

  • Peter F

    Let get a few fact straight first.
    Developers are not taxed at a commercial rate. The rate at which land is taxed depends on how it is zoned. If a developer owns RM-4, or pure residential land, the land will be valued as residential and class as residential, or $4.22 per $1000 of assessed value. However, if the vacant land is mixed use, even if the zoning allows for only a small percentage of commercial use, the site will be valued as residential and class 06 commercial, or $19.82 per $1000 of assessed value.
    You have to ask yourself the question, how much of the City’s resources does a vacant parcel of land consume? Very little?
    The “rich” developer of this east side property still has to pay taxes for this recreational property. The Class 08 Recreation/Non-Profit mill rate is $6.24 per $1000 assessed value.
    How does the City Benefit from this use? It get an esitmated $33,000 in taxes for a recreational use that cost them nothing. Local citizens get the benefit of temporarily using a vacant lot for a garden at no costs to them. The owner/developer gets to benefit because his holding costs are diminished greatly. Lower holding cost results in lower price point of a finished product thus cheaper housing. The only ones that get screwed are Class 06 – commercial properties. However, the Astoria next door taxes would increase slightly, less than $10, as the “lost” $132,000 in taxes are spread out over the $26 billion in commercial properties in the City of Vancouver, or $0.0051 per $1000 Assessed commercial value. As an local owner, would you like a nice community garden across the street or a vacant parking lot?

  • RW

    Something that hasn’t been reported here is the fact that these community gardens are a response to an unfair tax policy pursued by the BC Assessment Authority and the City.
    Let me explain: A development site that is slated for a 100% residential building will be assessed as COMMERCIAL until such time as construction has actually begun. This means a 5000% surcharge on the property taxes to the developer. The City is trying to soak developers and owners of residential development sites by unfarily assessing them as commercial. It is out of this policy that the landowners have responded with these community gardens, in an attempt to correct this usurious policy. To characterize this as a “tax break” is completely incorrect.
    Note that the tax rate on parks and community gardens (Class 8) is still much higher than that on residential classification. If the City and BC Assessment was not trying to undertake a massive tax grab on developers and property owners, these community gardens wouldn’t exist because they would actually increase the tax bill.
    Good on developers for getting creative and providing a community benefit, even if it is just an interim use. All the City is doing is pushing up the cost of housing even further with their crazy policies…

  • david hadaway

    I live near this so called “community garden”. It is a dump, a few boxes full of dirt which are not accessible to the public. The tax advantage gained by these undeserving slum landlords is real money, whether seen as lost revenue or as an extra burden unloaded on other businesses.
    Money that, spent on real vegetables grown by real farmers, could supply the needs of hundreds of families for a year! Money that would go a long way toward saving real assets to this city such as the Bloedel conservatory.
    I’d almost like to believe that there is some kind of civic corruption behind this scam as the alternative of total imbecility and incompetence is even more frightening to those of us who subsidize this folly.

  • John

    Yep, someone really needs to grow something at City Hall, and I can tell you, it ain’t vegetables.

  • Sharon

    how about the 1 story commercial property that has been zoned high rise residential. Right now, that residential potential (highest and best use) is being taxed at the commercial rate.
    equally unfair.

  • sv

    Yo, David I’ve got no strong feelings about this one way or another but you might want to wait til they get the thing built before you call it a dump.

  • david hadaway

    Well, not wanting to be unfair to the sincere people building this place I took another look.
    First, I was wrong to say there is no access, the gates off Hastings Street are chained shut but if you go fifty feet down the lane up to the Astoria Hotel dumpster you can get in.
    The “farm” consists of a large number of pine boxes, imagine coffins for a medium size dinosaur, lined with heavy duty butyl sheet with a thick layer of gravel over for drainage. The boxes are then filled with compost and the asphalt around them covered with wood chip.
    How the transportation and use of most of these harvested / manufactured / extracted products for a comparatively short term project can be considered “green” is a bit of a mystery. Even if they bought carbon offsets in unheated SRO’s there is no possibility that the carbon footprint they have already established will be absorbed by what they grow. And on that subject, how much will they grow?
    To justify $132,000 at $1 a kilo wholesale for veggies they need to produce 132 tonnes per annum. Maybe that’s a bit arbitrary but the example of other such gardens suggests that when the cold sets in and the bugs start munching the enthusism and productivity of the amateur farmer takes a nosedive.
    There will, however, be one group of locals using this garden with enthusiasm. Under the adjoining sidewalk is a huge network of rat burrows. These new wood boxes, well drained and warmed with steaming manure are a perfect environment for our little rodent friends.
    So lets close down the Bloedel Conservatory with all those boring fish and plants and birds and create a rat metropolis decorated with a few decomposing turnips. The perfect monument to the visionary real estate speculators and slumlords who are the only real beneficiaries of this scam.

  • david hadaway

    Sorry to keep on about this subject, but maybe this is even worse than it seems. According to Greening the City / SOLEfood / United We Can, “The property belongs to the owner of the Astoria Hotel who is letting us convert it to a garden in exchange for paying the taxes for the next couple of years”.
    I can only understand that to mean that on top of the $132,000 tax break from the city received by the Sahotas they will be getting the remaining $33,000 or so of liability paid by these charities. Quite a deal if true!

  • daniel wittal

    well i can say from being lead hand on that site. that the rats were my second major concern… it just so happens that they have no interest in the farm what so ever there is so many homeless people outhere who provide them with ample food. bread sandwhiches sweets whatever.. so nobody needs to keep that image in there head..
    secondly dipshit how else are you going to install 150 raised beds 12 feet long 20 iches deep and four feet wide without the use of trucks..
    I maybe a dumb farmer here but come on instead of the big critics here come try some of there newly harvested french breakfast raddishes or some delicous kale//nyhow peace out

  • daniel wittal

    okay here it is. SOLEFOOD is not a commuity garden, it is a .5 acre working mostly organic farm. who hires d.t.e.s residence. we supply potluck catering phs meal program. not bad for the first year. I am no longer lead hand in this farm. but i assure you that this farm is a very cool step in the right direction. I challenge everyone of you to go by this farm and use it like a mirror. and ask yourself how can i make my life a sustainable one.. ps seann I want my job back farm looks like im not there

  • I saw an article about high-rise greenhouses. If feasible, they would be a far better use of land than these purely symbolic projects.