Dane Gibson
Northern News Services

NNSL (July 02/99) - It just got six per cent more costly to make a life in Yellowknife.

The announcement that residential, multi-residential, commercial and industrial taxes are rising six per cent, effective immediately, has home and business owners saying enough is enough.

Johnson's Building Supplies owner Karl Lust said after more than 50 years of doing business here, he hates being put into the position of having to absorb a large tax hike by choosing between his customers or his operation.

"The city should be looking at ways of cutting their costs, but instead they have off-loaded that responsibility on to me and every other taxpayer," Lust said.

"I'm not going to penalize my customers with higher prices so I have to look at ways to cut my costs. I feel we shouldn't have to pay for any business, no matter how significant, that goes into receivership," he said, referring to Giant Mine's inability to pay taxes.

Jim Dives is a 22-year resident of Yellowknife who raised three kids here.

He said the lack of vision shown by the city is appalling. He recalls working for Giant Mine 14 years ago when there was talk of there only being five years of ore left in the doomed mine.

"There is no long-term planning. When is the city going to learn from its past mistakes?" Dives asks.

"We're already paying an extraordinary amount for gas, water and other services. Because of the tax raise, I'll be paying more on my mortgage. The city is asking for trouble.

"Why would anyone want to buy up here when you can live in Edmonton for so much cheaper? This tax raise will hurt the town," he added.

Regency International Hotels director of operations Curtis Sagmeister said his concern with the tax hike lies with people like Lust and Dives.

Regency owns the Explorer Hotel, Discovery Inn, the H&R Block building and a staff house. They will feel the effects of a larger tax bill but Regency is large enough to absorb the initial impact.

"Obviously, six per cent affects us. It's a hefty jump and we pay a hefty amount in municipal taxes but it's not going to put us out of business. Our guests won't be seeing a raise in rates because of this," Sagmeister said.

"I'm more concerned about the small business operators and homeowners. Those people are the ones who will say they can't afford to live here anymore. It's something that will have a compounding effect on everyone that remains."

He said as a businessman, he recognizes that a city relies on the tax base to provide services. But that doesn't explain, he said, why the city wasn't better prepared for the situation it found itself in.

"Our elected officials are supposed to anticipate adverse situations, such as a mine closing. Raising taxes is reactive -- it's not a proactive move," Sagmeister said.

"Yellowknife is an expensive place to do business. Tag another six per cent on to that and cross your fingers. The city is rolling the dice."