THUNDER BAY – The city’s finance and administration standing committee unanimously endorsed city staff’s recommendation to lower the large industrial tax ratio from 2.73 to 2.61, while the commercial ratio remains at the provincial threshold of 1.98, and the multi-residential ratio remains at 1.99.
“I’m happy to see a phased-in approach. I think a phased-in approach is always a compromise and it’s a good middle ground,” Coun. Mark Bentz said.
Last year, council voted to maintain the city’s existing tax ratios against the advice of city staff, who recommended decreasing the proportion of taxes paid by industrial, commercial and multi-residential property owners as a way to encourage growth in those sectors.
Keri Greaves, commissioner of corporate services and city treasurer, said the full implementation of the council-approved long-term property-tax strategy was put on hold due to council’s direction to maintain a focus on supporting residential affordability.
“Instead, the recommended option is intended to address what administration sees as a very significant structural risk in the city’s tax ratios, specifically the large industrial tax ratio, while having a very minimal impact on residential affordability,” he said.
Director of revenue, Kathleen Cannon, said the residential impact is $65.94 per $100,000 of assessed property related to the 2026 budget. The changes to the large industrial tax ratio amount to $0.89 or a 0.05 per cent increase on $100,000 of assessed property related to the tax ratio.
The tax bill for a single-family detached home assessed at $219,000, the median for Thunder Bay, will increase by $146.36.
“Across industrial, multi-residential, and commercial classes, Thunder Bay remains above the average. In the case of large industrial, this difference is especially pronounced. These higher ratios can impact competitiveness and investment, especially in the commercial and industrial sectors,” Cannon said.
Referring to a municipal study conducted by BMA Management Consulting Inc., she said there are 16 other municipalities with a large industrial property class, and most have one ratio for all their industrial properties.
The BMA’s average industrial tax ratio in 2025 was 2.1, far below the city’s large industrial ratio of 2.73.
“The city has only three properties in the large industrial class, which means higher volatility and less equity. Reducing this ratio helps address both issues,” Cannon said.
Bentz asked why focus on industrial and not the commercial?
According to the staff report, in 1998, city council adopted optional categories for tax classes as a temporary solution to mitigate large shifts in the overall tax burden. The optional classes were not intended to be permanent.
Cannon said the city phased out the optional classes. All but one.
“It is the ratio that is the furthest away from all the others and the highest ratio comparable to other municipalities as well,” she said.
McKellar Coun. Brian Hamilton asked how the industrial sector responds to the massive discrepancy between the city’s average industrial ratio and the provincial average.
“There are several site-selection factors for large industrial users, land availability, infrastructure, workforce, but tax policy alone can’t guarantee attraction. Maintaining materially high ratios than comparable industry, industrial properties does create disincentive,” Cannon said. “So, removing a known barrier aligns with our best, you know, it aligns with Thunder Bay more closely and our best practices across Ontario as well. So, the goal is not risk; the goal is risk reduction. It’s not guaranteed attraction, but certainly, tax policy is one way to help attract industrial business to Thunder Bay.”
