Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: June 22, 2017

FILE NO.: WR 146795

Assessed Person(s): Andrew Glenn Stadtegger and Catherine Dunn Stadtegger

Appellant(s): Andrew Glenn Stadtegger and Catherine Dunn Stadtegger

Respondent(s): Municipal Property Assessment Corporation Region ("MPAC") 09

Respondent(s): City of Toronto

Property Location(s): 299 Riverside Drive

Municipality(ies): City of Toronto

Roll Number(s): 1904-011-300-02500

Appeal Number(s): 3173495

Taxation Year(s): 2016

Hearing Event No. 667068 and 679870

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

Heard: April 26, 2017 in Toronto, Ontario

Parties	Representative
Andrew Glenn Stadtegger	Self-represented
MPAC	Erin Comeau
City of Toronto	No one appeared

DECISION OF THE BOARD DELIVERED BY J.L. WALKER

INTRODUCTION

1The subject property, 299 Riverside Drive is located near the Humber River, south of Bloor Street West and immediately west of the South Kingsway. Andrew Glenn Stadtegger, the appellant, filed an appeal of the assessment for the 2016 taxation year, which was returned at $1,668,000. Based upon the time-adjusted value of the 2015 sale of a neighbouring property, 301 Riverside Drive, he submits that the assessment should be reduced to within the range of $1,269,299 and $1,331,084. Erin Comeau, Property Valuation Analyst, appearing on behalf of the Municipal Property Assessment Corporation ("MPAC"), submits that the assessment for the 2016 taxation year is at current and equitable value.

2The Board must determine if the assessment of $1,668,000 is the current value of the subject property for the 2016 taxation year, and whether a further adjustment is required to achieve equity with similar lands in the vicinity.

DECISION

3The Board determines that the assessment of $1,668,000 is the current value of the subject property, and that no further adjustment is required to achieve equity with similar lands in the vicinity. The Board confirms the assessment for the 2016 taxation year at $1,668,000.

REASONS FOR DECISION

Legislation

4In making its determination, the Board is governed by the following provisions of the Assessment Act, R.S.O. 1990, c. A.31, as amended ("Act"):

5Section 19.(1) states that"...the assessment of land shall be based on its current value." Section 1 of the Act defines current value as "...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."

6Section 19.2(1) of the Act establishes January 1, 2012 as the valuation day for the 2013 to 2016 taxation years.

7Section 44.(3) of the Act provides the test that must be applied upon an appeal on any ground against an assessment:

(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.

8Under s. 40.(17), where value is the ground of an appeal, "...the burden of proof as to the correctness of the current value of the land rests with the assessment corporation."

9After hearing the evidence and submissions of the parties, the Board shall determine the matter pursuant to s. 40.(19) of the Act.

Preliminary Issue

10Mr. Stadtegger previously appealed his assessment for the 2014 taxation year, and was denied a review of the Board's decision in that matter, where a different panel of the Board confirmed the assessed value of $1,668,000 (WR 130086).

11MPAC sought to bring a motion for issue estoppel for the 2016 appeal at a hearing convened by the Board on March 28, 2017. The Board determined that it would not hear the motion and that the matter should proceed to hearing as MPAC's notice of motion was deficient in that it was not submitted to the Board 10 days before the hearing; it did not include an affidavit that service of the special notice was effected 14 days before the hearing; and it did not include an affidavit setting out a statement of the facts as required under Rules 32, 57 and 58 of the Board's Rules of Practice and Procedure then in force. A brief adjournment was granted as MPAC's representative, Tony Racioppo, did not disclose his evidence to the appellant prior to the hearing.

Current Value

12The Board determines that the current value for the 2016 taxation year is property is $1,668,000. The thrust of the Act is that all property in Ontario should be assessed at its current value, which is determined at a fixed date for each taxation cycle. For taxation years 2013 – 2016, the valuation day is January 1, 2012. The legislative purpose of a valuation day is to capture the marketplace at a point in time. While there is a right of appeal with each taxation year, the appellant must demonstrate that there has been a material change that merits an alteration to current value as of the legislated valuation day.

13The Board agrees with Mr. Comeau that the further away a sale is from the legislated valuation day, the less relevant it is to current value. One sale occurring 44 months after the legislated valuation day in the vicinity of the subject property is not sufficient evidence that an alteration is required to current value. Residential property is valued by the sales comparison approach, which involves the valuation of one property in comparison to the value of other similar properties. The use of one property as the basis of the sales comparison approach is exceptional and not warranted in these circumstances.

14The subject property is a two and one-half storey detached single family home that was built in 1936, and renovated in 2013, with an effective year built of 2002. It has a total building area of 2,662 square feet ("sq. ft.") and a total site area of 10,192.5 sq. ft. (Exhibits 1 and 2). The subject property and MPAC's comparable properties are all located in homogeneous neighbourhood E011, and each receives a positive adjustment of 6% for abutting a ravine (Exhibit 4). Mr. Comeau stated that MPAC relied upon the same evidence in the appeal of the 2014 taxation year, where the Board confirmed the current and equitable value of $1,668,000.

15While the parties agree that this area is an enclave of unique and historic properties, Mr. Stadtegger submits that there are important differences between the subject property and MPAC's four comparable properties (described in the table below), including the quality of the ravines, the amount of usable land to accommodate further improvements, and the relative desirability of various locations.

Address	Current Value $	Time - Adjusted Sale $ /Date	Building Total Area Sq. Ft.	Effective Frontage & Depth Linear Ft.	Effective Total Site Area Sq. Ft.
299 Riverside Drive	1,668,000	N/A	2,662	45.00 x 203.85	9,173
227 Riverside Drive	1,756,000	1,694,944 08/2012	2,479	75.00 x 195.00	17,025
92 Brule Gardens	1,808,000	1,720,448 07/2011	2,658	45.00 x 195.00	8,775
5 Brule Crescent	1,152,000	1,410,951 07/2012	2,433	48.00 x 139.00	6,672
67 Brule Gardens	1,818,000	2,137,255 04/2011	2,947	46.00 x 174.00	8,004

16MPAC has applied time adjustment factors to the sales to ensure that the sales reflect market conditions as of January 1, 2012 (Exhibit 4). The overall change in the market of 11.7% over a 24 month period was derived from a study of 240 sales from the subject property's neighbourhood from January 2011 to December 2012. These time-adjusted sales yield a range of values of $1,410,951 - $2,137,255.

17The appellant states that the Brule Crescent and Brule Gardens properties are superior for the quality of their ravines and view; and that 227 Riverside Drive is located further to the south on the more prestigious part of the street and has a much larger frontage. Mr. Stadtegger did not present evidence to quantify the impact of these factors.

18Mr. Comeau agrees that 67 Brule Gardens, which has a larger renovated building, is superior to the subject property. He describes 5 Brule Crescent as inferior to the subject property based upon its smaller building area and site area. He submits that the remaining comparables are relatively similar to the subject property.

19Mr. Comeau submits that the best approach to the evidence is to consider the range of sale values for the comparable properties due to the differences in building area and site area. The assessed value of $1,668,000 is higher than the $1,410,951 sale value of 5 Brule Crescent, which is smaller than the subject property in both these areas. It is lower than that of 92 Brule Gardens which is slightly smaller, but the most similar to the subject property in terms of total building area and total site area. This property sold for $1,720,448, slightly higher than the assessed value of the subject property.

20Based upon the time-adjusted value of the August 2015 sale of a neighbouring property, 301 Riverside Drive, Mr. Stadtegger submits that the assessment should be reduced to within the range of $1,269,299 and $1,331,084. 301 Riverside Drive has a similar total lot size (8,148 sq. ft.) and frontage (42 feet), a slightly smaller total building area (2,424 sq. ft.), and does not have a part storey (Exhibit 9). He asserts that the property is most like the subject property and the best evidence of the current and equitable value of his property for the 2016 taxation year.

21The appellant provided time-adjustments to reconcile the August 2015 sale value of $1,505,250 with the legislated valuation date. Using the assessed values of the subject property as at January 1, 2012 ($1,668,000) and January 1, 2016 ($1,969,000), he calculated an average annual rate of 4.24% "to discount the value" (Exhibit 10). Mr. Stadtegger states that the time-adjusted discounted value of the subject property as of August 2015 is $1,331,084. He provided a second analysis, using a rate of 5.6% per annum (derived from MPAC's time-adjustments), for a further discounted value of $1,269,299.

22The Board prefers MPAC's evidence, and finds the current value for the 2016 taxation years is $1,668,000. The Board does not agree that the sale of one property 44 months after the legislated value date supports a reduction to current value, or for the purpose of calculating time adjustments. There is no evidence to demonstrate that the market, which rose by 11.7% in 2011 and 2012, moved downwards.

23With regard to the appellant's time-adjustments, a larger sample is required for that purpose, such as MPAC's study of 240 properties. Those values were derived from sales occurring 12 months prior to and after the legislated valuation date of January 1, 2012, and are not relevant to a sale occurring in August 2015.

24While the August 2015 sale of 301 Riverside Drive may be of use as a comparable property for determining current value as at January 1, 2016, it is too distant from the legislated valuation date to assist in the present appeal. It cannot be relied upon to create time-adjustments to support an overall trend in the marketplace.

Equity

25The current value of the subject property can only be reduced if there is evidence that it is at a higher level than the assessments of similar lands in the vicinity. In this case, the evidence does not demonstrate that a further adjustment is required.

26The best evidence of an inequitable current value is an Assessment to Sale Ratio ("ASR") study of a sample of similar lands in the vicinity. The sample must be sufficiently large to be statistically meaningful. An ASR is calculated by dividing the assessed value by the sale value. A resulting median ratio of 1.00 or within 5% (0.95 – 1.05) demonstrates that current values are reflective of sale prices in the vicinity. If the resulting ratio is lower than 0.95, a downward adjustment must be made to a property's current value.

27The only evidence before the Board with regard to equity was presented by Mr. Comeau, a sample of 30 sales of residential properties (single family detached homes) located within 0.39 kilometres of the subject property that transacted between January 2011 and December 2012 (Exhibit 5). The 30 sales in this study have a median ASR of 0.99, indicating that no downward adjustment is required to the subject property's current value.

CONCLUSION

28MPAC's evidence demonstrates that a current value of $1,668,000 is reasonable for the 2016 taxation year. The 2015 sale presented by the appellant does not support a decrease to this value. The Board determines that the current value of the subject property is $1,668,000 for the 2016 taxation year, and that no further reduction is required to achieve equity with similar lands in the vicinity. The assessment is confirmed at $1,668,000 for the 2016 taxation year.