Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE:

May 26, 2015

FILE NO.:

WR 130788

Assessed Person(s):

1429829 Ontario Inc.

Appellant(s):

1429829 Ontario Inc. and Matthew Kuszewski

Respondent(s):

Town of Collingwood

Respondent(s):

Municipal Property Assessment Corporation (“MPAC”) Region 16

Property Location(s):

Silver Creek Drive (Vacant)

Municipality(ies):

Town of Collingwood

Roll Number(s):

4331-040-002-24910-0000

Appeal Number(s):

3000603, 3022974 and 3076352 (deemed)

Taxation Year(s):

2013, 2014 (and deemed 2015)

Hearing Event No.

578330

Legislative Authority:

Section 40 of the Assessment Act, R.S.O. 1990, c. A.31, as amended

Heard:

February 17, 2015, in Collingwood, Ontario

APPEARANCES:

Parties

Counsel+/Representative

1429829 Ontario Inc. and

Amanda Bauhofer

Matthew Kuszewski

MPAC

Patricia Thompson and Jeff Thompson

Town of Collingwood

No one appeared

DECISION OF THE BOARD DELIVERED BY LESLIE FLEMMING

INTRODUCTION

1This appeal was heard in the Town of Collingwood on February 17, 2015. The Board reserved its decision.

2The subject property is vacant residential land not on water located on Silver Creek Drive in Collingwood. The assessment was returned in the amount of $263,000 for January 1, 2012, the valuation day. The property has effective frontage of 103.21 feet on Silver Creek Drive and an effective depth of 999.99 feet for a total site area of 2.66 acres. Hydro is available to the site. The site is zoned Residential First Density (R1). The property is an irregular shape, and testimony by the Appellant, confirmed by photographic evidence, indicates that the rear portion of the lot is an area that drains surrounding properties, and is located in proximity to a Provincially Significant Wetland.

ISSUE

3The Board must first determine the correct current value of the land.

4Having established the current value, the Board must have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment of the subject property to make it equitable with similar lands in the vicinity if such an adjustment would result in a reduction of the value.

DECISION

5The Assessment Review Board (“Board”) determines that the current value of the subject property is $263,000.

6The Board finds that there is no evidence before it supporting the conclusion that the value of the subject property requires an adjustment in accordance with s. 44.(3)(a) of the Assessment Act (“Act”) in order to make it equitable with the assessed values of similar properties in the vicinity.

7Accordingly, the assessment of the subject property as at January 1, 2012, for the 2013 and 2014 taxation years is confirmed at $263,000.

REASONS FOR THE DECISION

8Section 44.(3)(a) of the Act requires the Board to first “determine the current value of the land.” The definition of “current value” is contained in s. 1 of the Act:

“current value” means, in relation to land, the amount of money the fee simple, if unencumbered, would realize if sold at arm’s length by a willing seller to a willing buyer.

9Section 19.(1) states that:

Assessment based on current value. – The assessment of land shall be based on its current value.

10The best measure of current value is an arm’s length and market-tested sale of the subject property on or close to the valuation day - January 1, 2012. If no such transaction took place, a further measure of current value can be derived from the arm’s length and market-tested sales of comparable properties in the same vicinity and market. This measure acts as a benchmark and gauge of the correctness of the assessed value of the subject property.

11Evidence on behalf of MPAC was presented by Patricia Thompson, who filed the following exhibits:

Exhibit 1 – Valuation Report for Silver Creek Dr., Collingwood;

Exhibit 3 – Aerial Photograph/Map of the Subject Property and Surrounding Area;

12Ms. Thompson presented evidence of value using the sales of four vacant properties in the same vicinity as the subject property occurring between December, 2009 and July, 2011. In order to adjust the sales prices of the comparable sales properties to the valuation day, Ms. Thompson provided the Board with her evidence respecting price changes over time, based on 480 vacant property sales occurring in the vicinity between January, 2009 and December, 2012. Ms. Thompson testified that overall market prices fell 5.52% during the entire period. On Table 1 of Exhibit 1 she provided Time Adjustment Factors for each month between January, 2009 and December, 2012. These factors were used to adjust the sales prices of her comparable properties to show the estimated value of each on January 1, 2012. The Appellant did not challenge this method of adjusting for changes over time.

13Amanda Bauhofer presented evidence on behalf of the Appellants. She filed Exhibit 2, which was a summary of her verbal testimony and copies of listing agreements relating to nine properties, of which two were sales occurring in 2014 and one was a sale occurring in 2012. Each of Ms. Bauhofer’s listing agreements were labelled Exhibit 1 to 9. The Board will refer to them as Exhibit 2-1 to 2-9.

14The Board prefers to use evidence of sales occurring close to the valuation day. Where this is not available, the Board will expand the window to accommodate the best evidence available, being cognizant of the fact that, notwithstanding MPAC’s evidence respecting changes in prices over time, the farther away events occur from the valuation day will always require greater adjustments, and therefore the greater possibility of error. In this case, the evidence disclosed no sales in the preferred time period which would be within six months of the valuation day. Four sales provided by the parties took place within 18 months of the valuation day, and it is these four sales to which the Board will look for assistance in deriving a current value for the subject property. The Board is not assisted by Sale D provided by MPAC (13 Evergreen Road) because it took place 25 months from the valuation day, nor by Exhibits 2-5 (37 11th Line, Grey County) and 2-7 (63 Saunders Street, Collingwood) which sold in May and March, 2014, respectively, or 29 and 27 months past the valuation day.

15The information concerning the four remaining sales is contained in the following table. Time adjusted sales prices are derived using the MPAC evidence from Table 1 of Exhibit 1.

TABLE 1

Subject Prop

11 Forest

7 Juniper

9 Juniper

19 Broadview

Lot Size (Acres)

2.66

0.73

0.85

0.95

0.43

Frontage (Feet)

103.21

143.24

Depth (Feet)

999.99

Sale Price (Time Adj) $

210,237

148,996

172,154

70,910

Sale Date

Jun-10

Jul-11

Nov-10

Nov-12

16Evidence given by both parties disclosed no impediments to home construction on these four comparable sales properties. Ms. Bauhofer testified that the Juniper Street properties are located in a neighbourhood of large, newer and more expensive homes than is the Silver Creek property. Her example, 19 Broadview, is located in a different part of Collingwood. No information was provided about the nature of construction in that area, which makes it harder to compare.

17Ms. Bauhofer testified that the subject property had been purchased as part of a larger lot, and was then severed with a view to constructing one or two single family homes on the lot. She indicates that the Town would permit the construction of only one home at the front of the lot. Construction is limited by the necessity of allowing for septic bed drainage. She testified that the property is located in the middle of the Silver Creek Wetland Complex, and, as such, is affected by flooding of the Silver Creek and drainage from other properties in the vicinity. Ms. Bauhofer believes this location adversely affects the value of the subject property. While referring in hearsay evidence to an appraisal received from a local real estate professional, no evidence of the appraisal was provided and the realtor was not called to testify. The Board is therefore unable to quantify the affect on value of the subject property by its location in proximity to a wetland area.

18The evidence of the four sales discloses that, based on a per acre value of each property, the subject property is valued only slightly more per acre than the much smaller property located at 19 Broadview in Collingwood, and significantly less per acre than the other three comparable sales. Calculating the per acre price of each property at its time adjusted sales value, and calculating the subject property at a price per acre based on the total assessed value of $263,000 results in the following per acre value for each:

• Subject Property: $98,872

• 11 Forest: $287,995

• 7 Juniper: $175,289

• 9 Juniper: $181,214

• 19 Broadview: $95,138

19Insufficient information was given by either party to compare the qualities of the different lots. Only the property at 11 Forest Drive is located in close proximity to the subject property. No information was provided by the Appellant as to the comparisons between the immediate vicinity of the 19 Broadview property and the vicinity of the subject property. Therefore, no explanation was given as to the difference in the values of these vacant lots.

20The Board accepts that the subject property is larger than any of the comparable properties selected, and economies of scale would dictate that it would be valued at less per acre than similar properties in the vicinity, which is the case here. There was no evidence given on behalf of the Appellant which would serve to undermine the evidence of presented by MPAC in this case, and no evidence was tendered to support the Appellant’s conclusion that current value of the property is in the range of $100,000 to $120,000. The Board finds that the current value of the subject property is $263,000.

Equity

21Once the Board has determined the current value of the land, it is required by s. 44.(3)(b) of the Act to:

44.(3) Same, 2009 and subsequent years. – For 2009 and subsequent taxation years, in determining the value at which any land shall be assessed, the Board shall,

(a) determine the current value of the land; and

(b) have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment of the land to make it equitable with that of similar lands in the vicinity if such an adjustment would result in a reduction of the assessment of the land.

22Neither party introduced evidence relating to the assessed values of similar lands in the vicinity.

23The Board finds that, in the absence of evidence relating to the values at which similar lands in the vicinity have been assessed, the Board will not make an adjustment to the current value.

CONCLUSION

24The Board determines that the current value of the subject property is $263,000.

25The Board finds that there is no evidence before it supporting the conclusion that the value of the subject property requires an adjustment in accordance with s. 44.(3)(a) of the Act in order to make it equitable with the assessed values of similar properties in the vicinity.

26Accordingly, the assessment of the subject property as at January 1, 2012, for the 2013 and 2014 taxation years is confirmed at $263,000.

2015 DEEMED APPEAL

27An appeal for the 2014 taxation year is presently before the Board. Section 40.(26) provides that the appellant is deemed to have made the same appeal for the subsequent taxation year if the appeal is not finally disposed of before March 31 of the subsequent taxation year. The Board has not disposed of the 2014 appeal before March 31, 2015. For that reason, this decision also applies to the 2015 taxation year.

28Section 40.(26) of the Act directs:

Deemed appeals, 2009 and subsequent years

For 2009 and subsequent taxation years, an appellant shall be deemed to have brought the same appeal in respect of a property,

(a) in relation to the assessments under sections 32, 33 and 34 for the year; and

(b) in relation to the assessment, including assessments under sections 32, 33 and 34, for a subsequent taxation year to which the same general reassessment applies, if the appeal is not finally disposed of before March 31 of the subsequent taxation year or, if an assessment has been made under section 32, 33 or 34, before the 90th day after the notice of assessment was mailed.