Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: November 23, 2016

FILE NO.: ID 138636

Assessed Person(s): Digital Toronto Nominee Inc.

Appellant(s): Digital Toronto Nominee Inc. c/o Epic Realty Partners Inc.

Respondent(s): City of Markham

Property Location(s): 371 Gough Road

Municipality(ies): City of Markham

Roll Number(s): 1936-020-125-45000-0000

Appeal Number(s): 3116035

Taxation Year(s): 2014

Hearing Event No.: 603832

Legislative Authority: Section 364.(14) of the Municipal Act, S.O. 2001, c. 25, as amended

Heard: January 28, 2016 in Markham, Ontario

APPEARANCES:

Parties

Digital Toronto Nominee Inc.

Town of Markham

Counsel+/Representative

Michelle Tomascik

Mike Jones

INTERIM DECISION OF THE BOARD DELIVERED BY CRISTINA MARQUES

ISSUE

1The subject property is improved with a single industrial building with two storey interior office areas consisting of 107,992 square feet (sq. ft.) The Board must decide whether or not to confirm the rejection for vacancy rebate dispensed by the Town of Markham (“Town”) for the 2014 taxation year. Michelle Tomascik representing Digital Toronto Nominee Inc. testified that the appellant submitted the complete application to the Town of Markham in January 2015, and well before the last day of February as prescribed by the Municipal Act, R.S.O. 2001, c. 25, as amended (“Act”).

2Section 364.(5) states:

Evidentiary requirements

(5) The program may include evidentiary requirements that must be satisfied for the owner to be entitled to a rebate under this section.

3The Town, represented by Mike Jones, rejected the application because additional information was requested after the application was made and the appellant failed to provide this information in a timely manner as required by s. 364.(8) of the Act.

4Section 364.(8) states:

Request for information

(8) For the purposes of determining the proper amount of any rebate payable under this section, the municipality may, by letter sent by mail, served personally or delivered by courier, require the owner or manager of a property referred to in an application under this section to provide any relevant information or produce any relevant records within such reasonable time as is set out in the letter.

5The City urges the Board to confirm its decision. The appellant represented by Michelle Tomascik, replied that the application was timely, and that the information pertinent for the Town to grant a vacancy rebate for 2014 was provided in a timely manner.

INTERIM DECISION

6The Board is required to determine the eligibility of the application based upon the information presented at the hearing when the Board must be reasonably assured that all parties satisfied the regulations as prescribed by the by s. 364.(16) of the Act which states:

(16) In a complaint under subsection (14) or (15), the Assessment Review Board shall determine the amount of any rebate owing to the applicant.

7The Board must determine whether the portions of the subject properties that were vacant during the 2014 taxation year qualify for a tax rebate and if so, the amount of the tax rebate owing to the appellant.

8The Board finds that the property is in an industrial property class, was vacant in 2014, and that the appellant qualifies to receive a rebate for the 2014 taxation year. The subject properties meet all of the requirements set out in the Act and Regulation and do not fall within any of the exclusions set out in s. 1.(5) and (6) of the Regulation.

9The Board orders the Town to calculate the amount of the rebate that is owing to the appellant and provide the amount and the details of the calculation within 60 days of the release of this interim decision. If the parties agree as to the amount of the rebate, Minutes of Settlement shall be filed with the Board within 90 days of the date of the release of this interim decision and order. If the Board does not receive Minutes of Settlement within 90 days of the release of this interim decision and order, the hearing will be reconvened so that the parties may present their evidence and argument with respect to the calculation of the rebate and the Board will determine the amount of the rebate owing.

REASONS FOR INTERIM DECISION

10The Board must have regard to s. 364.(1), (2), (5), (8), (12), (14), (16), (17), and (18) of the Act.

11Section 364.(1) states:

Vacant unit rebate

364. (1) Every local municipality shall have a program to provide tax rebates to owners of property that has vacant portions if that property is in any of the commercial classes or industrial classes, as defined in subsection 308 (1).

12Section 364.(2) states:

Requirements of program

(2) A tax rebate program under this section must meet the following requirements:

1. The program shall apply to eligible property as prescribed by the Minister of Finance for the purposes of this section.

2. If the property is in any of the commercial classes, the rebate shall be equal to 30 per cent of the taxes applicable to the eligible property, as determined under clause (12) (b).

3. If the property is in any of the industrial classes, the rebate shall be equal to 35 per cent of the taxes applicable to the eligible property, as determined under clause (12) (b).

4. An application may be made by or on behalf of the owner.

5. The application shall be made to the local municipality by the last day of February of the year following the taxation year in respect of which the application is made or such later date as the Minister of Finance may prescribe, either before or after the expiry of the time limit.

6. Unless otherwise prescribed by the Minister of Finance, an owner or a person on behalf of the owner shall submit one application for a taxation year, except that an interim application may be made for the first six months of the taxation year.

13Section 364.(5) states:

Evidentiary requirements

(5) The program may include evidentiary requirements that must be satisfied for the owner to be entitled to a rebate under this section.

14Section 364.(8) states:

Request for information

(8) For the purposes of determining the proper amount of any rebate payable under this section, the municipality may, by letter sent by mail, served personally or delivered by courier, require the owner or manager of a property referred to in an application under this section to provide any relevant information or produce any relevant records within such reasonable time as is set out in the letter.

15Section 364.(12) states:

Regulations

(12) The Minister of Finance may make regulations,

(a) prescribing the requirements for a property or portion of a property to be eligible property;

(b) respecting how to determine the amount of tax to which the percentages specified in paragraphs 2 and 3 of subsection (2) are to be applied;

(c) respecting the determination of the value of eligible property by the assessment corporation;

(d) prescribing the number or frequency of applications under paragraph 6 of subsection (2);

(e) governing programs under this section, including prescribing additional requirements for those programs, and governing the procedural requirements that those programs must include;

(f) prescribing a date for the purposes of subsections (2), (15) and (20).

16Section 364.(14) states:

Complaint

(14) A person who has made an application under this section may, within 120 days after the municipality mails the determination of the amount of the rebate, complain to the Assessment Review Board in writing that the amount is too low.

17Section 364.(16) states:

Determination by the Board

(16) In a complaint under subsection (14) or (15), the Assessment Review Board shall determine the amount of any rebate owing to the applicant.

18Section 364.(17) states:

Same

(17) Section 40 of the Assessment Act applies to a complaint under subsection (14), (15) or (24) as if it were an appeal under subsection 40 (1) of that Act, except the assessment corporation shall not be a party for purposes of subsection 40 (11) of that Act.

19Section 364.(18) states:

Appeal to Divisional Court

(18) Section 43.1 of the Assessment Act applies to a decision of the Assessment Review Board.

Appellant’s Evidence and Submissions

20Ms. Tomascik argued that the Town’s rejection of the appellant’s application is inappropriate because:

1. The Town received the vacancy application relating to the 2014 taxation year in a timely manner before the legislated deadline, which also included:

• 12 month rent rolls specific to 2014,

• Leased Premises Surrender Agreement between Digital Toronto Nominee and Telus Retail Limited dated February 21, 2014.

• Warehouse Notification Surrender Date letter, including Fifth Lease Amending Agreement between Digital Toronto Nominee and Telus Retail Limited dated December 18, 2013.

2. The areas claimed as vacant on the application were vacant in excess of 90 days;

3. The areas claimed were clearly delineated by walls of various construction, or floor levels;

4. The areas claimed were capable of being leased, but in some areas were not able to be leased for immediate occupancy because the space was under repairs, renovation, and construction.

21Ms. Tomascik testified that on June 24, 2015 the appellant received an Incomplete Notice Letter from the Town requesting further information.

22Ms. Tomascik called the Town and Markham, and spoke with Mr. Jones who confirmed that the application and supporting documentation were received in time, but that he was having difficulty with the analyzing of the documents. She testified that she indicated to the Town that the subject property was in 2014 a transitioning property, and that is why the original units did not match the new configuration. On July 15, 2015, Ms. Tomascik sent a colour coded chart to Mr. Jones indicating the changes.

23The appellant received the rebate Denial Letter dated August 5, 2015, and an appeal was filled under s. 364.(14) of the Act with the Board for the 2014 taxation year. Ms. Tomascik submitted Exhibit 1 consisting of copies of:

• Application for Tax Rebate filled before the last day of February 2015. Including the corresponding documentation.

• A letter from the Town asking for further information dated June 24, 2015.

• Copies of all the correspondence between the parties.

• A letter from the Town denying the application.

Town’s Evidence and Submissions

24Mr. Jones agreed with Ms. Tomascik that the application was received on a timely basis, but argues that the information submitted was confusing, and that the square footage for the vacant areas is larger in total than the overall measurements of the build.

25Mr. Jones, submitted Exhibit 2 consisting of copies of the application to the Town. He testified that some of the information was missing and other information was inconsistent, and for those reasons the application was rejected by the Town.

Analysis

26The Board finds that the original application was filed on time and in compliance with s. 364.(2) and (5) of the Act. The Board recognizes that the compilation of information for the purposes of determining the appropriateness of vacancy rebates can be complicated. The Board also notes that a certain level of frustration arose between the parties as this information was requested and provided. At the end of the day, the Board must determine if the subject units were vacant, and if so, for what duration and from when.

27The Board is satisfied by the evidence that the subject units were in fact vacant, and that the applicant fulfilled the Towns requests for clarification. Mr. Jones did not communicate to the Board that the appellant did not meet the requirements of the Town’s rebate program, only that the appellant’s application was confusing.

28In the Board’s view the documents provided by the appellants are sufficient evidence that the units were vacant, particularly in the absence of evidence to the contrary, and the colour coded maps provided by Ms. Tomascik depict the vacant spaces in a reasonably clear way. The Board accepts Ms. Tomascik’s explanation that the same floor areas were vacant and occupied at different times of the taxation year, resulting in a vacant square footage that is greater than the whole when added in a linear way.

CONCLUSION

29The Board orders the Town of Markham to calculate the amount of the rebate that is owing to the appellant and provide the amount and the details of the calculation within 60 days of the release of this interim decision. If the parties agree as to the amount of the rebate, Minutes of Settlement shall be filed with the Board within 90 days of the date of the release of this interim decision and order.

30If the Board does not receive Minutes of Settlement within 90 days of the release of this interim decision and order, the hearing will be reconvened so that the parties may present their evidence and argument with respect to the calculation of the rebate and the Board will determine the amount of the rebate owing.