Roy L Hales/ Cortes Currents - Cortes Island just passed a major hurdle on the road to adopting a 3% tax on short term rentals. In the first meeting of the new board, the Strathcona Regional District unanimously voted to write a letter of support, which will accompany the Cortes Community Housing Society’s application to the provincial government for a Municipal and Regional District Tax (MRDT).
“We won't know if it's put in place until the province approves our application, but we're hoping that it will be in place by June or July of 2023,” said Sandra Wood, Executive Director of the Cortes Community Housing Society.
Cortes Island's new Director, Mark Vonesch, explained, “This is a tax that affects all short term rentals on Cortes, whether you do that through Airbnb or other online platforms, or you rent your place out privately. It also applies to the ‘hotels’ on Cortes, which are the Gorge Harbour Marina, the Cortes Island Motel and Hollyhock. In order for this application to be submitted, you need at least 50% support from the ‘hotels’ on the island. We were really fortunate to have Hollyhock, the Gorge and the Motel all sign on. Part of my argument to the Regional District is, ‘Look, there’s the support from 100% of all the ‘hotels’ on Cortes!”
If the Government approves the housing society’s application, people booking a short term rental anywhere on Cortes will pay a hotel tax. This will be collected by the ‘hotel’ or Airbnb, which sends it to the government, who passes it over to the Cortes Housing Society.
Vonesch explained that he found housing was the #1 priority mentioned by most Cortes residents.
“We need more rental housing. We need affordable purchase options. If we want to maintain the culture of Cortes, we need to support our businesses and make sure that they have places for their workers to live.”
Wood added that the housing situation changes after tourists discover remote locations like Cortes Island. The Airbnb and vacation rental market is more lucrative than providing year round rental accommodation to locals. This has created a shortage of housing.
At their inaugural meeting on November 9, Vonesch told the incoming Strathcona Regional District Board that the proposed MRDT would help finance the Rainbow Ridge affordable housing project on Cortes Island. The Cortes Housing Society has already raised $1.6 million from the community and purchased the land. They want to build 24 one, two, and three bedroom units. There is a huge demand for affordable housing on Cortes, and 150 people are already on the waiting list for the 16 units that will be rented out at below market prices. The other 8 units will be used for professionals.
“One of our challenges is that we have a clinic, but we don't have places to put doctors and nurses,” explained Vonesch.
He added while the Rainbow Ridge project seems ambitious, the Cortes Housing Society has already proven themselves. Units in the Senior’s Village which they completed in 2020 are currently being rented out for $535 a month, or one-third of the tenant’s income.
“What I'm asking is that the SRD provide a letter of support for the application that we're making,” he said. “My opinion is there's zero risk to the SRD for writing this letter of support. The worst case scenario is that this application goes into the BC government, and they say, ‘Nope, sorry, we're not going to implement it.’ Best case scenario, they're going to say, ‘Yes. We're going to raise an estimated $50,000 a year that’s going to provide a revenue for Cortes to put towards community housing.”
The new SRD Chair, Ron Kerr, was quick to endorse the proposal, “Thank you Director Vonesch for bringing this to us. It sounds like a great initiative. I think you presented it really well and I think this is an opportunity to really show what this board can do and not drag things on, but try and move them forward.”