Fees and Charges
Local governments use fees and charges as an alternative to
property taxation for generating revenue.
Typically, fees and charges are used for recovering the cost of
or for using municipal property. For example, user fees are usually charged
for sewer, water, and garbage collection. Charges are often required when
applying for a building permit or a business license. In addition, fees and
charges are common when using public transit, using recreation facilities and
renting local government property.
Fees and charges can be a one-time amount or they can be varied
according to different factors. For instance, a bus pass could be
purchased that is good for one month, or a rider could choose to pay the
fare each time they ride the bus. In addition, different amounts
can be owing depending on the distance travelled.
The amount of a fee or charge is chosen to provide enough money to
recover costs and ensure the service will
continue in the future. Fees are generally applied on a user-pay
basis so that those who benefit from the service, bear the cost of it. For instance, a
property owner may be charged directly for the cost of fire
personnel responding to a false alarm so that this cost does not have
to be shared by all property owners. Local governments must make
available to the public, on request, a report showing how a fee was
In some special cases, fees and charges are restricted by
legislation. One such charge is interest. The rate and method of
interest calculation for money owing to a local government is
typically set by the province through legislation or regulation. Such
provincially set interest calculations include interest on refunds of
and interest rate on taxes
in arrears or delinquent taxes. A local government can only establish the method for
calculating interest if the province has not done so.
Fees for the deposit or removal of soil are also legislatively
restricted. To apply these fees, council must create a bylaw which
does not become valid until it has received approval
by the minister.
Most fees imposed by a local government that are
unpaid form a lien on the land and its improvements and they can be
collected as taxes and taxes in arrear.