An Act to amend the Income Tax Act (rehabilitation of historic property)

Sponsor

Peter Van Loan  Conservative

Introduced as a private member’s bill. (These don’t often become law.)

Status

Dead, as of March 21, 2018

Subscribe to a feed (what's a feed?) of speeches and votes in the House related to Bill C-323.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

This enactment amends the Income Tax Act to establish a tax credit for expenses related to the rehabilitation of a historic property. It also establishes a tax deduction for the capital cost of property used in the course of such a rehabilitation.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.

Votes

March 21, 2018 Passed Nineth Report of the Standing Committee on Environment and Sustainable Development
March 23, 2017 Passed That the Bill be now read a second time and referred to the Standing Committee on Environment and Sustainable Development.

Committees of the HouseRoutine Proceedings

March 21st, 2018 / 6:10 p.m.
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Liberal

The Speaker Liberal Geoff Regan

I declare the motion carried.

Accordingly, pursuant to Standing Order 97.1(2)(d), the proceedings on Bill C-323 shall come to an end.

Environment and Sustainable DevelopmentCommittees of the HouseRoutine Proceedings

March 21st, 2018 / 6:05 p.m.
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Liberal

The Speaker Liberal Geoff Regan

The House will now proceed to the taking of the deferred recorded division on the motion to concur in the ninth report of the Standing Committee on Environment and Sustainable Development concerning the recommendation not to proceed further with Bill C-323.

Environment and Sustainable DevelopmentCommittees of the HouseRoutine Proceedings

March 1st, 2018 / 6:25 p.m.
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NDP

Wayne Stetski NDP Kootenay—Columbia, BC

Mr. Speaker, I would like to thank the member for York—Simcoe for introducing this private member's bill.

Canadians take great pride in their built heritage, as they do in their diverse culture and history. Bill C-323 would provide Canadians with a much needed tax credit to assist them in repairing and maintaining heritage buildings. I have spoken with many constituents in my riding of Kootenay—Columbia, and the bill is very welcomed there. We have many heritage homes and other buildings, and repairing them can be very expensive.

Recently, I had the privilege of sitting on the Standing Committee on Environment and Sustainable Development while we studied this bill. At the same time, the committee also looked at the state of federal funding and management of national heritage. Along with other members of the committee, I learned a great deal. I learned that between 2003 and 2006, the federal government offered financial incentives for the restoration of commercial buildings.

Over three years, the commercial heritage properties incentive fund contributed $15 million for this purpose. The economic impact of the fund was $143.4 million in restoration work, a sound investment, and in fact, almost a ten to one return on government investment. While the committee examined many heritage concerns, I will focus on the testimony and recommendations about built heritage because they speak directly to the issues we are considering here with Bill C-323.

The committee heard from Ms. Natalie Bull, executive director of the National Trust for Canada. Ms. Bull said:

Why would a parliamentary committee be concerned with the state of historic places in Canada? I think there are lots of great reasons. For a start, there is the potential for positive impacts on climate change. Canada's buildings are the third-largest greenhouse gas emitting sector, and the reuse and renewal of heritage buildings capitalizes on materials and energy already invested, reduces construction and demolition waste, and avoids the environmental impact associated with new development.

In addition to climate change benefits, historic places can contribute to a strong economy. Rehabilitation projects generate up to 21% more jobs than the same investment in new construction. They're a great stimulus measure, and they typically use local labour and materials, such that 75% of the economic benefits of heritage rehabilitation projects tend to remain in the communities where these buildings are located.

More jobs, action on climate change, and reduced waste all seem like excellent reasons to support Bill C-323. It would have been great for the government to have included funding for this in its budget released earlier this week.

Personally, I was very disappointed that there was no money in the government's 2018-2019 budget to fund a national home energy retrofit program across Canada for homes in general and nothing for heritage homes either.

Mr. Chris Wiebe, the manager of heritage policy and government relations at the National Trust, reiterated the organization's support for this legislation. He said:

First, we would recommend implementation of a federal heritage rehabilitation tax incentive, such as the measures recently proposed in Bill C-323. That is a proven way to attract private and corporate investment to privately owned historic places and to give them vibrant new uses. Two, the government could consider extending a rehabilitation tax credit to heritage homeowners to get even more impact. Three, federal investment in seed funding for creative financing mechanisms like crowdfunding could help many more charities and not-for-profits attract private donations and would save and renew some of the thousands of other heritage buildings that make up the fabric of our communities. Finally, an increase in federal cost-shared funding available for the national historic sites heritage places program would help turn the tide of neglect for these important national icons as well.

While Bill C-323 would not answer all of these questions, it would be a good start toward supporting Canadian heritage. In fact, when the environment and sustainable development committee, which I sat on, made its recommendations to the House of Commons on these matters, it spoke directly to the need for a tax credit. The committee tabled its 10th report entitled “Preserving Canada's Heritage: the Foundation for Tomorrow”, in December 2017, just two short months ago. Recommendation no. 11 of that report said:

The Committee recommends that the federal government establish a tax credit for the restoration and preservation of buildings listed on the Canadian Register of Historic Places.

That would appear to be a slam dunk for Bill C-323. The committee recommends a tax credit for heritage building restoration and preservation. A bill comes before the committee that does exactly that, yet the Liberals on the committee went against their own recommendations and voted to kill the legislation. They forced through a report that recommended that the House stop dealing with Bill C-323. If those members of Parliament received anywhere near as much correspondence supporting the bill as I did, I have to say that their constituents will be very disappointed. Still, we have a chance to pass the proposed legislation at third reading, and I call upon all members of the House to support it.

Members may be interested in knowing what else the committee recommended on the issue of built heritage. Recommendation 12 of the report says:

The Committee recommends that the federal government, in co-operation with provincial and territorial governments, work to adapt future versions of Canada’s National Model Building Codes in a manner that will facilitate the restoration and the rehabilitation of existing buildings and the preservation of their heritage characteristics.

This is important, because old buildings do not easily adapt to new building codes. One example, given by Mr. Robert Eisenberg at York Heritage Properties, is that adding insulation to the roofs of older buildings increases snow load in the winter because heat no longer escapes through the roof to melt the snow, thus threatening the building's structural integrity.

The committee spent time looking at issues specific to rural areas, like my riding of Kootenay—Columbia, resulting in recommendation 13, which reads:

The Committee recommends that Parks Canada review its National Cost-Sharing Program and, if it is determined that rural sites are under-represented in applications for funding or in the awarding of funding, steps should be taken to improve the program.

Rural areas have specific struggles when it comes to preserving heritage buildings. In particular, there is sometimes a lack of specialized craftspeople and specialty materials available locally, and the cost to bring them in from bigger cities is prohibitive. That is why heritage buildings in many rural areas are left to fall into neglect. I am very fortunate in my riding of Kootenay—Columbia to have a number of very skilled tradespeople who are ready, willing, and able to rehabilitate heritage homes.

While recommendation 13 did not address the need for a tax credit directly, it is clear that the passage of Bill C-323 would be particularly valuable in rural areas like mine. Finally, heritage building owners would be able to afford the additional expenses required to restore these important buildings.

I wish to finish my remarks today by reading from a January 2017 letter I received from the City of Nelson that asked me to support Bill C-323. The City of Nelson said that these tax measures could transform the economic fundamentals for renewing historic places and encourage building conservation of every size and type, from landmark commercial buildings to modest homes.

I agree and that is why we will be voting in support of Bill C-323.

Environment and Sustainable DevelopmentCommittees of the HouseRoutine Proceedings

March 1st, 2018 / 6:15 p.m.
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Conservative

Peter Van Loan Conservative York—Simcoe, ON

Mr. Speaker, I am proud to rise in the House as the sponsor of Bill C-323, which had the potential to revitalize our heritage sector to preserve Canada's built heritage, something that has had erosion. We are very much a product of what has come before us. Our cities, the places where we live, our small communities are defined by the buildings that are there, but we have lost far too much over Canada's history.

Bill C-323 was a bipartisan effort that was worked on together with members of the Liberal Party and other parties to ensure that something that had been asked for and sought for years and years, and worked on by governments, Liberal and Conservative, behind the scenes, could finally come to fruition through a proper tax credit scheme that would allow for the preservation of our heritage buildings.

Our heritage buildings define communities. They create economic growth. They improve our quality of life. They build social capital. They give people a reason to appreciate where they are, to go to special places, and to make special places.

It is therefore very disappointing to see this report from the environment committee with regard to Bill C-323, particularly in view of the bipartisan support it had in the beginning.

Initially, I worked with members of the Liberal Party and others to develop the bill and get it supported in the House of Commons. It would have created specific tax incentives on eligible heritage restoration work done to designated heritage buildings. Specifically, there would have been a 20% tax credit for rehabilitation and restoration work done to a designated heritage building. The work would have had to be certified by a registered architect. The bill would also have created an accelerated capital cost allowance for capital costs, again finding a way to create an incentive, with minimal cost to the public purse, for people to restore and preserve buildings instead of demolishing them.

In effect, the bill would have created a heritage policy for Canada that is fair to property owners, whom we in the public sector ask to bear the cost and burden of preserving our heritage through our process of designating their buildings and telling them that we want them saved, yet we do not provide anything on the other side to compensate them for those increased costs. This legislation would have created that impact, and it would have had a positive effect on Canada's national heritage.

The National Trust for Canada, our leading organization on built heritage, estimates that we have lost over 20% of our built heritage in the past 30 years, including buildings like the Edison Hotel in Toronto and the Redpath Mansion. For that reason, the national trust was strongly supportive, and it was one of the collaborative partners we worked with to develop this bill.

In fact, what the member said is entirely, patently untrue. There was enormous consultation with stakeholders, municipalities, etc. that went into the development of the bill. Through that process of consultation, it became evident that heritage means so much to many communities. It creates value for those communities and encourages tourism. It is something all Canadians can enjoy. That is why the bill had so much support.

What support did we have though the consultation? It was across political lines. It was across the nation. It was from individual members of Parliament, from dozens of historical societies, and dozens and dozens of municipalities. The Federation of Canadian Municipalities supported it. The royal society of architects supported it. Provincial governments supported it. I could go on and on.

The suggestion that it did not provide for collaboration with partners shows that whoever wrote that speech had no comprehension of the way heritage designation works, or the way the bill was crafted. In fact, it created a partnership that did not exist up until then among provinces, which set the terms for heritage preservation; municipalities, which make the decisions on which buildings to designate; and, finally, putting into the piece the federal partnership through the support for restoration. There could be nothing better than building a collaborative partnership. That is why I was so pleased to see that partnership build and the bill pass through second reading in the House, with support, it should be noted, from members of every party. It was not all the members of every party in the House, but members from every party in the House supported the bill, including several members of the Liberal Party.

At committee, a consensus emerged that mirrored the consensus across Canada that the bill would have a tremendous positive impact on our heritage built stock, and on the communities we live in. It seemed that all members of the committee were quite supportive. This was evident in their comments and their questions for the witnesses.

The members heard a lot about tax credits elsewhere, including for example the one in the United States, which has had a huge impact in revitalizing inner cities, in creating economic activity, and in creating tourist attractions and hubs where they never were before.

The Urban Land Institute magazine showcases its best projects of the year. Every year it overwhelming shows projects that have at their heart the American version of this heritage tax credit. People saw that it was valuable.

Also in that study they learned that the costs were minimal. In fact, the likely impact on the fiscal framework federally was because of the incentive it created for restoration and the like, and the economic spinoffs and developments that happened. More than any of these other kinds of studies that give us dubious reports on economic impact, this impact would be positive and taxpayers would get far more back than they ever put out, as well as the significant public benefits that would have been derived.

Then something happened. Just before it came time for the committee to vote, the Prime Minister's Office cracked down on its MPs for speaking their minds at committee and for having the temerity to have voted as they saw fit at second reading. Many of them had personally worked on the bill at second reading and to get it through to committee. Despite all of their previous support, Liberal MPs were forced to vote down the bill at committee by the Prime Minister's Office against their will. I understand that one of them was virtually in tears.

Supporters of the bill were understandably disappointed to see the bill voted down. Bill C-323 was an opportunity to refocus our efforts on heritage preservation during the 150th anniversary of Confederation. The policy seemed ideal for the milestone year in our nation's history. Unfortunately, the committee made the decision that we are now considering today.

We heard that in the companion report there was, believe it or not, a recommendation for tax credits like this. However, the criticism was, as we just heard in the speech from the government, that it should be done through the normal budget process. This was the criticism levelled by critics, and that is what was in speeches previously.

This committee report was tabled last year. The budget process continued. The budget was this week. Anybody who suggested to we wait for the budget and the proper budget process misled supporters of the bill, supporters of heritage preservation. No such tax credit was forthcoming. No such policy was forthcoming. It simply did not exist. The story about a budget process was a mere excuse for a government being so miserly and short sighted that it would not allow the more visionary members of a caucus who saw the value in the bill to support it as they had at second reading.

It is not surprising we see this from the Liberal government. I have been fond of noting that it seems to have a bit of a war on history. We saw it in the 150th anniversary of Confederation, where the themes disallowed the observance of the actual event of Confederation or events that celebrated our history. The five themes that were selected were fine. but if we wanted to have any support or assistance or to be part of the federal government's Canada 150 festivities, history and Confederation were not allowed.

This is just one of many examples of how the Liberal government has continued and perpetuated that war on Canadian history.

There was the cancellation of the Canada 150 medals for those people in local historical societies who do so much to build their communities. All of a sudden the opportunity to recognize people like that, people who build Canada, was wiped out. Why? Because the government is committed to a war on history.

There is a American great author who said, “History is who we are and why we are the way we are.” We are losing that here.

There was a great Canadian historian and author with great influence, Canon Lionel Groulx, who said:

No, a nation cannot separate itself from its past any more than a river can separate itself from its source, or sap from the soil whence it arises. No generation is self-sufficient. It can and does happen that a generation does forget its history, or turns its back upon it; such an action is a betrayal of history.

Then of course there was the great Joseph Howe, who resisted Confederation 150 years ago. He then embraced it, and joined the cabinet of Sir. John A. Macdonald later. He noted:

A wise nation preserves its records, gathers up its muniments, decorates tombs of its illustrious dead, repairs great public structures and fosters national pride and love of country by perpetual reference to sacrifices and glories of the past.

That was Joseph Howe in 1871. That is what Bill C-323 would do, and that is why I still encourage some within the Liberal Party to have the courage and conviction to support it, and to reject this report from the committee to turn down Bill C-323.

Environment and Sustainable DevelopmentCommittees of the HouseRoutine Proceedings

March 1st, 2018 / 6:15 p.m.
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Liberal

Chris Bittle Liberal St. Catharines, ON

Mr. Speaker, I rise to comment on the ninth report of the Standing Committee on Environment and Sustainable Development regarding Bill C-323.

The report is the result of the decision taken last year by this House to refer the bill to committee for further study. Bill C-323 proposes federal tax credits for investments in eligible projects to conserve privately owned heritage properties. During this period, the committee also undertook a robust study of heritage preservation and protection in Canada.

The committee's report, entitled “Preserving Canada's Heritage: The Foundation for Tomorrow”, urges the Government of Canada to better protect and conserve this country's built heritage. Among its 17 recommendations, the report calls for the introduction of financial measures, enhanced federal leadership, and greater collaboration with indigenous peoples.

The Government of Canada welcomes both reports, and I fully support the concurrence motion now before us.

While the end goal of promoting heritage conservation is certainly worthy, the mechanism proposed in Bill C-323 suffers from several significant shortcomings. These shortcomings make it impossible for the standing committee, or for me, to support the proposed legislation.

The standing committee properly points out that Canada must do more to protect its built heritage. As the committee noted, financial incentives that encourage investment in the rehabilitation of historic properties and heritage places have much to offer. The committee, however, identifies many of the fundamental weaknesses in the mechanism proposed in Bill C-323. One such weakness is inherent in any tax changes undertaken outside of the regular budget process. As my hon. colleagues recognize, these types of changes often lead to problems of consistency and coherence in federal fiscal management.

Furthermore, as presented, it is challenging to determine the impact of this bill on federal revenue. Then there are the added costs of administering the tax credit and requisite certification process, along with amending the Income Tax Act.

Other shortcomings of the bill include its lack of an adequate accountability mechanism, and its exclusion of important conservation partners, such as not-for-profit entities, indigenous governments, and municipalities. To me, this lack of inclusivity is serious because it fails to acknowledge a fundamental truth about heritage conservation in our country: it is necessary for it to be a collaborative undertaking.

Bill C-323 was not designed in collaboration with other jurisdictions and partners, and does not properly take into account current conservation tools and approaches. The standing committee emphasizes that for conservation efforts to succeed, they must involve broad collaboration and engagement with other jurisdictions, indigenous groups, stakeholders, and partners.

Our heritage assets are certainly worthy of conservation, and we can and must do a better job of protecting them. To achieve this goal necessarily requires thoughtful, strategic collaboration. Financial measures can be an effective way to support heritage conservation, but only when carefully integrated into a broader framework.

Bill C-323 does not meet this test and does not merit the support of this House. I thank the members of the standing committee for their efforts and fully support the concurrence motion now before us.

Environment and Sustainable DevelopmentCommittees of the HouseRoutine Proceedings

March 1st, 2018 / 6:15 p.m.
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Liberal

The Assistant Deputy Speaker Liberal Anthony Rota

Pursuant to Standing Order 97.1(2), the motion to concur in the ninth report of the Standing Committee on Environment and Sustainable Development, recommendation not to proceed further with Bill C-323, an act to amend the Income Tax Act (rehabilitation of historic property), presented on Thursday, November 30, 2017, is deemed to be proposed.

(On the Order: Motions)

November 30, 2017—Mrs. Schulte (King—Vaughan)—That the Ninth Report of the Standing Committee on Environment and Sustainable Development (recommendation not to proceed further with Bill C-323, An Act to amend the Income Tax Act (rehabilitation of historic property)), presented on Thursday, November 30, 2017, be concurred in.

Environment and Sustainable DevelopmentCommittees of the HouseRoutine Proceedings

December 4th, 2017 / 3:10 p.m.
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Conservative

Joël Godin Conservative Portneuf—Jacques-Cartier, QC

Mr. Speaker, we all agree that the government needs to show some leadership when it comes to heritage conservation. That being said, where we do not agree is how the financial resources are being managed.

One of my Conservative colleagues presented a solution in committee that demonstrated that Bill C-323 did represent a solution, at no cost to the government.

The Liberals rejected this bill. Most of the recommendations meant additional costs. The committee did not take into account the financial implications of these measures in its analysis.

While the objectives of the legislative recommendations are commendable, the Conservative members of the committee believe that it would be irresponsible, considering the huge deficit, to impose these expenses on taxpayers without examining the financial implications.

Environment and Sustainable DevelopmentCommittees of the HouseRoutine Proceedings

November 30th, 2017 / 10:10 a.m.
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Liberal

Deb Schulte Liberal King—Vaughan, ON

Mr. Speaker, I have the honour to present, in both official languages, the ninth report of the Standing Committee on the Environment and Sustainable Development in relation to Bill C-323, An Act to amend the Income Tax Act (rehabilitation of historic property).

The committee has studied the bill and recommends not to proceed further with this bill.

November 28th, 2017 / 9:55 a.m.
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Liberal

The Chair Liberal Deb Schulte

Seeing no further comments, we'll vote on the motion.

(Motion agreed to)

Thank you. We are done.

I want to thank everybody. Bill C-323 has been interesting, and I'm glad the report is speaking to a lot of the things we want to see move forward. I am very hopeful that we're going to see some progress on this file because it's very important to all of us.

Before we let everybody go, we have a couple of things to settle. The next meeting was to be on Bill C-57. Linda has asked us not to do it on Thursday, so we're going to do the press release and we'll have a discussion about what that's going to look like based on what has happened today. That will be first thing on Thursday.

I want to bring to your attention that we had two amendments to management plans tabled by Minister McKenna. If we want to discuss them, we can. I did ask Mr. Fast. He said that's not necessary. You can let me know if you are interested in talking about those at committee. We can. They're tabled and we have the option to discuss them if we want. It's up to you guys. You can let me know.

On Thursday I think it would be really helpful if we had some discussion on our trip to the GLOBE summit and make sure we have figured out how we're going to move forward on that initiative.

Then on Tuesday, we will start our clause-by-clause work on Bill C-57.

November 28th, 2017 / 9:55 a.m.
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NDP

Wayne Stetski NDP Kootenay—Columbia, BC

When I looked at this bill, again, I thought of some of the people I know who own historic buildings. I know we have a report with great recommendations coming forward, but I saw this as an important step in moving in the right direction. From my perspective, I will continue to support Bill C-323. I think it's a good step.

November 28th, 2017 / 9:50 a.m.
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Liberal

John Aldag Liberal Cloverdale—Langley City, BC

If you want me to, sure. The motion is:

That the committee report the following to the House: The Committee is supportive of the principle of Bill C-323 and believes that financial incentives, including tax credits, which encourage investment in the rehabilitation of historic properties and heritage places are necessary; however, the committee notes the following concerns with the bill: tax changes undertaken outside the budget process make it more difficult to ensure a coherent and consistent approach to fiscal management; the effect on federal revenue due to the proposed measure with the bill containing no upper limit on the amount which can be claimed for tax purposes with the parliamentary budget officer assessing costs at $55 million to $67 million in the first five years and Department of Finance officials stating it could be as high as $90 million a year; the lack of accountability tools associated with this measure; the restrictive nature of the incentive with not-for-profit entities, indigenous governments, and municipalities being ineligible; the cost to the federal government to administer the proposed changes to the Income Tax Act and the certification of the work being done for the purposes of the tax credit; the incentive not being designed in collaboration with other jurisdictions and partners to ensure its effectiveness; the lack of consultation on this measure with tax experts, as well as those provinces and territories that are a party to the Canadian Register of Historic Places, as well as municipal and indigenous governments; That in light of the above-noted concerns with the bill, the committee, pursuant to Standing Order 97.1, recommends that the House of Commons do not proceed further with Bill C-323, an act to amend the Income Tax Act (rehabilitation of historic property).

We can go through any of the bullets if anyone is interested, but we feel there was testimony as we went through the bill to substantiate the seven bullets that we have outlined here and the concerns.

November 28th, 2017 / 9:45 a.m.
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Liberal

John Aldag Liberal Cloverdale—Langley City, BC

As the document is being distributed, I want to say I really appreciated the work Mr. Van Loan did in putting forward this bill. It brought a very positive light to heritage. As we saw, the study we just discussed formed a very important part as we looked at the financial piece to it. I think it's a very important and timely discussion that we have as a government.

That being said, from our side we do have concerns which we've outlined in seven bullets. I'll give people a minute to look at it. Essentially we've tried to capture that we're very supportive of the principles of Bill C-323, but our bottom line is we're not recommending that we proceed at this point. We can go through the bullets once people have digested that.

November 28th, 2017 / 9:45 a.m.
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Liberal

The Chair (Mrs. Deborah Schulte (King—Vaughan, Lib.)) Liberal Deb Schulte

We're going to reconvene now into our second session which is in public.

Pursuant to the order of reference of Thursday, March 23, 2017, Bill C-323, an act to amend the Income Tax Act (rehabilitation of historic property), we're going into clause-by-clause consideration.

I'm going to call clause 1.

Mr. Aldag.

October 24th, 2017 / 10:20 a.m.
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Senior Advisor, Norton Rose Fulbright Canada, As an Individual

Leonard Farber

I think Bill C-323 certainly addresses any issues in the commercial context. For any buildings that are used for commercial purposes, rental purposes, or anything that generates a stream of income that is taxable, and against which one can claim investment tax credits or refundable investment tax credits, as well as depreciation or capital cost allowance, the bill is very helpful and workable in the commercial context.

For home ownership, I believe a grant mechanism to stimulate that kind of work is what would deliver the necessary results and a similar mechanism for non-profit organizations or charities that have heritage properties that would be important to renovate. We need a mechanism that gets them the capital that they would need in order to do the kind of work that this bill foresees, in terms of heritage property. That's the way to deliver that.