Landlord Licencing Fees Result in Whopping Rent Increase
The City of Waterloo is by far the greediest of all municipalities when it comes to
the charges levied under its Landlord Licensing By-law. Waterloo’s licensing fee
and mandatory charges (the bulk of which go to its bureaucratic “cousin”, the
Electrical Safety Authority) amount to over $1,000 per townhouse unit and are
imposed on a “per bedroom” basis (the more bedrooms the higher the fee). The
fees are imposed on “converted residential dwellings” but are also imposed on
purpose built, properly zoned townhouse complexes which are fully compliant with
all applicable building codes from the date of construction but they are a lucrative
target for revenue hungry bureaucrats.
The Waterloo “tax grab” was recognized by the Landlord and Tenant Board in a
landlord’s application for an above guideline rent increase (AGI) based on the levy
of the licensing fee as an extraordinary cost in “municipal taxes and charges”.
The rent increase resulting from Waterloo’s license fee levies was 6.0% plus the
Guideline increase of 1.8%, for a total of 7.8% (on average about $70.00 per
month increase in monthly rent!).
Two tenants, funded by the Province of Ontario, appealed the Board’s decision to
the Divisional Court and we defended the Landlord’s position seeking a dismissal
of the appeal. The Divisional Court dismissed the tenants’ appeal and awarded
the Landlord legal costs of $7500.00 (for a copy of the Court’s ruling, go to the
following link: Houston v. 530675 Ontario Limited
For the past few years the Landlord of this complex urged council not to impose
its demonstrably unfair tax and warned of the onerous rent increase
consequences for family based tenancies. The City bureaucrats persuaded
Members of Council to ignore those warnings and it is the tenants who must now
pay for Staff’s greed and Council’s indifference.
As determined by the Landlord and Tenant Board, and affirmed by the Divisional
Court, the licensing fees and mandatory charges levied by Waterloo are
“municipal charges and taxes”. and the money goes straight into the coffers of
the bureaucracy at City Hall and funds an easy “make work” project for the ESA…it
does nothing for tenants who are already completely protected under
the Residential Tenancies Act. No doubt the City will cast blame on the landlord
for passing on this “tax”; however, it is the accepted practice (and certainly the
practice of bureaucrats and politicians) to pass expenses incurred in the course of
business or employment on to the ultimate consumer…and the City was aware
from the outset that this would be the consequence of their money grab.