ALMOST 2600 THUNDER BAY TENANTS WILL GET TO PAY LOWER RENT IN 2021

Some Thunder Bay tenants have gotten good news from city staff in recent weeks: they are eligible for a rent reduction starting in January 2021.

Section 131 of Ontario’s Residential Tenancies Act says tenants are entitled to an automatic reduction in their rent when their landlord’s property taxes decrease by at least 2.49 per cent from one year to the next.

Kathleen Cannon, the director of revenue for the City of Thunder Bay, said almost 2600 notices have been sent out to tenants living in “multi-residential properties” in the city. She said that accounts for almost two-thirds of all such properties registered with the city.

Multi-residential properties are defined as containing seven or more units on the property.

Cannon says the rent reduction is, at least in part, due to a change to the city’s long-term tax strategy, made in 2019.

The change saw a shift in the amount of taxes paid by each property class — which could include residential, multi-residential, commercial, industrial, among other property classes. In the case of multi-residential properties, taxes decreased.

According to the Residential Tenancies Act, municipalities must send a notice to the landlord and the tenants of all eligible multi-residential properties, but it also says tenants are automatically entitled to the rent decrease, even if that notice wasn’t sent.

Cannon said the amount of the rent reduction will vary from property to property, depending on the number of units within the rental complex and how much the taxes are reduced for the property.

The act says if a tenant lives in a complex with seven or more units, tenants are entitled a 20 per cent reduction of the percentage decrease in property taxes paid by the landlord. For complexes with six or fewer units, tenants are entitled to a 15 per cent reduction.

“Say the taxes went down by 10 per cent, the tenant is entitled to 20 per cent of that 10 per cent. So really, that equates to a two per cent reduction in their rent,” explained Cannon. “So an example would be, if they paid $800 a month, two per cent of that would be $16. So they would see a reduction of $16 on their monthly rent.”

City staff completed the calculations for all landlords and tenants living in multi-residential properties, but Cannon said tenants living in properties with six or less residential units are required to work with their landlords to determine if they are eligible for an automatic rent reduction, and if so, how large of a reduction that could be.

Tribunals Ontario, which is responsible for the Landlord and Tenant Board, did not respond to CBC News by deadline to clarify how tenants could determine their eligibility for a rent reduction.

The act states that all rent reductions are permanent.