Well written, something to share with others who don’t understand the situation.
The link below provides information on the Govm’t of Manitoba programs in effect for the Lake Manitoba Flooding of 2011:
ALMS received the following email on January 10, 2012 from Minister Struthers in reply to our meeting of Nov 14th and subsequent letter sent Nov 24th:
Ms. Cheryl Smith, President
Association of Lake Manitoba Stakeholders (ALMS)
Dear Ms. Smith,
I would like to thank you and the other members of the ALMS executive for meeting with me and other senior government officials on November 14, 2011. I wanted to take this opportunity to provide some follow-up information on the items discussed at the meeting.
Regarding lake levels and longer term water management framework around Lake Manitoba, I would like to thank you for the constructive suggestions put forward by ALMS. As you may be aware, the province has committed to assessing alternatives to enhance the capacity of the Assiniboine River and Lake Manitoba flood-control systems. This and other review processes coming out of the 2011 flood will help to inform longer term improvements to flood management around Lake Manitoba and elsewhere around the province. The province will keep ALMS informed as these processes move forward and ensure there is an opportunity for local stakeholder input.
On the subject of Individual Flood Proofing Initiative (IFPI) projects, the province recognizes that there has been an issue in the timely identification of benchmarks for water levels to be used in moving or raising homes or cottages. This is directly related to the availability of qualified surveyors during this busy period across the province. Manitoba Water Stewardship is actively looking at ways to improve capacity in this regard through exploration of the potential for use of private sector and other public resources. In addition, while we recognize that some of your members take issue with the deductible in place for the IFPI program, as was discussed in our meeting, this is a province-wide program designed to add the value of permanent flood protection to a property. If permanent protection is put in place, the copayment for the special Lake Manitoba Financial Assistance program addressing damages from this year’s flood is waived. It is also important to note that the deductible paid by Lake Manitoba permanent or seasonal residents for the IFPI program is less than the 14% paid by those elsewhere in the province since the first $20,000 is deductible-free around Lake Manitoba.
With respect to the questions from ALMS on Canada Revenue Agency implications for program reimbursement and Temporary Accommodations Program (TAP) income, please see the attached information. Individuals are still advised to seek independent advice on their specific situation when filing their tax returns as these are only general guidelines.
Finally, I would like to thank your organization for the comments and discussion on the subjects of 2012 reassessments and municipal tax bases, the potential for use of snow windrows, and financial assistance programs timelines and processes. Your insights are very valuable and will be taken into account as we move forward.
Original signed by
Stan Struthers Minister
The following are the basic income tax implications for flood victims who receive government assistance (which includes forgivable loans). Government includes the federal, provincial and municipal governments, Crown corporations, or other public authority (an entity that has a duty to the public, is subject to a significant degree of governmental control, and uses its profits for the benefit of the public). Generally there should be no tax consequences if the assistance is used to repair damaged property, replace destroyed property, or to offset business expenses. Compensation for personal losses is not taxable but compensation to businesses for loss of profits or inventory is taxable.
Government assistance received by an individual to compensate them for personal losses (clothing, households items, personal residence) experienced as a result of flooding will not be subject to income tax, including payments received for meals and accommodation/rent. On the other hand, any costs incurred by individuals – such as meals and temporary accommodations – are not deductible as an expense.
Compensation for losses on personal property that may be subject to capital gains tax when disposed/sold (cottages, valuable jewellery, coin or stamp collections) will increase the amount of the taxable capital gain unless offset by the cost of repairs or improvements.
Government assistance to compensate a business for property destroyed or damaged will generally not have any tax consequences where the property is repaired or replaced. Otherwise the amount received is included in income. There may be tax consequences if the assistance is not received in the same year as the repairs or replacement property is acquired unless the taxpayer makes the appropriate income tax election to go back and adjust either the repair costs deducted or the capitalized cost of the replacement property.
In the case of non-depreciable property (land), the assistance will reduce the cost base and increase the taxable capital gain when the property is subsequently disposed/sold. However, if the assistance is received after the property is disposed/sold, the compensation is included in income and taxable.
Assistance to compensate a business for a loss of inventory or profits is included in income and taxable. If the assistance offsets the cost of replacing inventory or a business expense, the assistance is not included in income and reduces the cost otherwise deductible as a business expense.
Note: This meeting is only open to appointed representatives.
Association of Lake Manitoba Stakeholders
JANUARY 18TH 2012 – 7 P.M.
1 ST. JOHN’S AMBULANCE WAY
PORTAGE AVENUE (ACROSS EARL’S)
1. Call to Order 7:00 p.m.
2. Introductions of members & area they represent
3. Adoption of the Agenda
4. Reading/Adoption of ALMS Minutes , November 9th 2011
5. Reading/review of Executive Minutes November 9th and December 6, 2011.
6. Business arising from the Minutes
7. President’s report & Executive members
a. All reports from meetings were posted on ALMS website
8. New Business:
a. Filling of vacancy – Executive Committee
b. what to do about lack of response to issues raised with Minister Struthers;
c. updated graph of Lake Manitoba levels
d. the issue of the direct drain of Lake Manitoba; and
e. recent statements by Minister Ashton regarding the flood; and
f. agree on priorities and next steps
a. All correspondence (emails etc) are posted on ALMS website.
Next meeting date: Open House for any member of associations to attend next ALMS meeting.
We’ve been asked to pass this message on from the RM of St. Laurent:
The R.M. of St. Laurent would like to express their appreciation of all the volunteer efforts in our Flood battle. The gracious donations of food, cash, time and tireless work was astounding and lightened the burden of the community. We feel that the outstanding effort put in by everyone is deserving of recognition and so we offer everyone our thanks and gratitude.