Stouffville Eyes Tax Sales to Recover Millions in Unpaid Property Taxes

Hamilton Spectator

26-04-2025

● At year end, Stouffville had nearly $10.3 million in unpaid 2024 property taxes from over 5,700 accounts.
● More than $5.2 million is still outstanding from 2022 and prior, despite Staff recently collecting $1.7 million.
● The Town must remit taxes to the Region and Province regardless of collection success, placing pressure on municipal finances.
● Council has directed Staff to prepare a report on proceeding with tax sales by the end of May.
● To recoup unpaid levies, tax sales allow the Town to auction properties that are more than two years behind on payments.
● No tax sales have been conducted in over a decade, with Town Staff prioritizing payment plans over forced sales.
Mounting arrears and mandatory costs are prompting Stouffville to consider tax sales, a measure it hasn't taken in more than a decade. The legal process allows the Town to auction off properties whose owners have failed to pay their property taxes.
In 2024, Stouffville maintained 19,922 individual property tax accounts. By year-end, payments had been collected from 14,215 accounts, generating $125,155,938 in gross revenue. However, the remaining 5,707 accounts represented nearly $10.3 million in unpaid taxes.
Additional outstanding amounts include $3.64 million from 738 accounts linked to 2023, and a further $5.22 million from 281 accounts tied to 2022 and earlier.
Although the Town collects property taxes, only about 36 percent of those funds stayed within the municipality last year. 45 percent of the revenue was forwarded to York Region, and 19 percent was allocated to the Ontario government for education funding.
These transfers must be remitted regardless of Stouffville's collection status from taxpayers. Consequently, outstanding tax accounts create a dual financial burden: the mandatory payments must still be made while the Town simultaneously goes without revenues needed to support its operating budget.
'Even though it is our responsibility…to collect taxes, our bills and payments of taxes to the school boards and to the Region continue,' Councillor Maurice Smith said during Council's April 16 meeting. 'We get no reprieve from these payments simply because we cannot collect, we must still pay them their particular allocations.'
Stouffville has made progress in collecting outstanding taxes in recent years. Commissioner of Finance and Treasurer Jeremy Harness noted that, in just the first two weeks of April, the Town had recovered roughly $50,000 in arrears.
Mayor Iain Lovatt commended Staff efforts in collecting nearly $1.7 million tied to 2022 and earlier, but he noted that over $5.2 million remain outstanding. He explained that Staff have the authority to conduct tax sales through Ontario's Bill 86, the Respecting Property Taxpayers Act.
'We've already paid the Region and we've already paid the Province for education costs associated with that,' Lovatt said. 'The whole of the municipality and our residents are paying for those arrears, and it shouldn't be that way.'
To address the issue, Council directed Staff to report back on initiating tax sales as a means to close delinquent accounts and recover lost funds. That report is expected by the end of May.
A tax sale is a legal tool that allows municipalities to auction properties whose owner has fallen significantly behind on their tax payments. In Stouffville, a property becomes eligible for tax sale when outstanding taxes go unpaid for more than two years—double the one-year period allowed through Bill 86.
Residents with overdue taxes receive multiple communications under Stouffville's current policy, including alerts attached to tax bills, late payment charges, and overdue collection and arrears notices.
During the COVID-19 pandemic, the Town paused arrears notices in appreciation of financial struggles residents may have been experiencing. There has been a recent push to reintroduce them, and that effort resulted in the April collections noted by Harness.
'Arrears notices really started again about a month ago, and Staff are now working through the list of accounts,' he said in recent comments to Bullet Point News. 'So someone who could be in arrears may not have received a notice yet.'
The Town's extended window before initiating a tax sale gives property owners additional time to pay off their account or sell their home. However, once a property is auctioned, any accrued equity is forfeited, and proceeds go toward settling the tax debt.
To avoid this outcome, Town Staff prioritize working with property owners to establish payment arrangements. As of December 31, 2024, 45 of the 281 tax-sale-eligible accounts had entered into such agreements. The remaining 236 accounts, representing tax receivables of over $4.6 million, remained at risk.
Harness said the Town has not conducted a tax sale in over 10 years.
'The intention is that we are able to work with property owners to arrange for payment, and that can be full payment or setting up payment arrangements,' he explained. 'As long as those arrangements are maintained and adhered to, then we're perfectly fine to continue working with that over a tax sale.'
He added that the process itself is lengthy, often taking up to two years, meaning owners have additional time and opportunity for payment even after a tax sale process has been initiated.
'In cases when property owners don't engage with us at all, a tax sale becomes our final recourse,' Harness concluded.
Other municipalities warn that tax sales carry substantial risks for buyers. According to the City of Markham,
tax sales
are conducted on a 'buyer beware' basis—meaning no viewings, no guarantee of possession, and potential responsibility for eviction proceedings, outstanding utility bills, or other liens. Markham officials advise potential buyers to seek legal counsel before submitting bids.
As part of their forthcoming report, Town Staff will review and clarify Stouffville's tax sale procedures and conditions.