Gail Henley Olsheski v. Municipal Property Assessment Corporation, 2017 CanLII 43884

Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: July 7, 2017

FILE NO.: WR 146893

Assessed Person(s): Gail Henley Olsheski

Appellant(s): Gail Henley Olsheski

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

Respondent(s): City of Toronto

Property Location(s): 180 Cottingham Street

Municipality(ies): City of Toronto

Roll Number(s): 1904-054-210-02500-0000

Appeal Number(s): 3164029

Taxation Year(s): 2016

Hearing Event No.: 667280

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

Heard: May 15, 2016 in Toronto, Ontario

APPEARANCES:

Parties	Representative
Gail Henley Olsheski	Self-represented
MPAC	Stephen Stadelmann
City of Toronto	No one appeared

DECISION OF THE BOARD DELIVERED BY MARCELLE BOURASSA

INTRODUCTION

1The property is a two and three-quarter storey semi-detached home with 2,503 square feet (“sq. ft.”) of total building area and an unfinished basement area. The total lot size is 3,500 sq. ft. It was originally constructed in 1890 and its condition is “average unrenovated” and has a quality class rating of 7. There is no garage. The property receives a -3% variable adjustment as there is no parking. Gail Olsheski has owned the property since 1982 and is well acquainted with the neighborhood.

2Stephen Stadelmann, representing MPAC, is of the opinion that the current value of the property is correct and equitable at $1,100,000 and asks that the assessment as returned be confirmed for the 2016 taxation year.

3Ms. Olsheski takes the position that the property is inequitably assessed in relation to other properties in her neighborhood and that she is being priced out of her neighborhood due to increasing property taxes. She expressed her concern that she is not getting every benefit to which she should be entitled. Ms. Olsheski is of the opinion that the subject property should be assessed at between $878,000 and $950,000.

4This appeal raises two issues: does the assessment of $1,100,000 reflect the current value of the land; and should the assessment be adjusted to make it equitable with the assessments of similar lands in the vicinity.

DECISION

5For the reasons stated below and as directed by s. 44.(3)(a) of the Assessment Act (the “Act”), the Board sets the current value of the property, as of the valuation day of January 1, 2016, at $1,100,000 and finds that there is no evidence leading to the conclusion that the current value, as determined above, is not equitable relative to the assessments of similar lands. It requires no further adjustment under s. 44.(3)(b) of the Act.

6Accordingly, for the 2016 taxation year, the assessment is confirmed at $1,100,000.

REASONS FOR DECISION

The Legislation

7The initial task for the Board is to determine the current value of the subject property as required by s. 44.(3)(a) of the Act.

8Section 19.(1) of the Act states that the assessment of the land shall be based on its current value. Current value is defined in s. 1 to mean, 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 19.2(1)(3) of the Act provides that for the period consisting of the four taxation years from 2013 to 2016, land is valued as of January 1, 2012.

10In determining the value at which the land shall be assessed, s. 44.(3) of the Act requires that the Board (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.

11Section 40.(17) of the Act provides that, where value is the ground of appeal, the burden of proof as to the correctness of the current value of the land rests with the assessment corporation.

12After hearing the evidence and the submissions of the parties, the Board shall determine the matter pursuant to s. 40.(19).

THE BOARD’S ANALYSIS

MPAC’s Case

13Mr. Stadelmann assessed the current value of the property using the direct sales comparison approach and provided information on the sales involving seven properties in proximity to the subject property that represent the range in market value of similar un-renovated or minimally renovated semi-detached homes in the vicinity. On the basis of a median sale rate of $558.95 per sq. ft., he established the correct value of the subject property at $1,399,000. He is satisfied that the current value assessment of the subject property of $1,100,000 is reasonable.

14Mr. Stadelmann submitted an Equity Analysis (Exhibit 3) that considered 30 arm’s length sales of residential properties within 0.3 kilometres of the subject property that took place between January 2011 and December 2012. They produced a median Assessment to Sales Ratio (“ASR”) of 1.01, which is within the acceptable standard of 0.95 to 1.05 required to establish that the level of assessments of similar properties is reflective of the level of sales prices in the vicinity.

15Mr. Stadelmann is of the opinion that the current value of the property is correct and equitable at $1,100,000 and asks that it be confirmed for the 2016 taxation year.

Appellants Case

16Ms. Olsheski takes the position that the property is inequitably assessed in relation to other properties in her neighborhood and that she is being priced out of her neighborhood due to increasing property taxes. She expressed her concern that she is not getting every benefit to which she should be entitled.

17More specifically, she raised concerns relating to the quality class rating of 7 assigned to her home given its condition and that like neighboring properties, her property should receive additional negative variable adjustments for proximity to heavy traffic (-18%), abutting a multi-residential property next door (-6%), proximity to a commercial property (-4%) and proximity to a nuisance (-5%). She acknowledged that she receives a -3% adjustment for no parking but feels that it not enough.

18Ms. Olsheski is of the opinion that the subject property should be assessed at between $878,000 and $950,000.

Current Value

19The initial task of the Board is to use the best evidence available to determine the current value of the property as required by s. 1 and s. 19.(1) and s. 44.(3)(a) of the Act.

20The best evidence the Board can receive of current value is an arm’s length and market-tested sale of the subject property on the valuation day or close to it. If, as in this case, no such transaction took place, the next best measure of current value is arm’s length and market-tested sales of comparable properties located nearby, as close as possible to the valuation date of January 1, 2012. The measure acts as benchmark and a gauge of the accuracy for the assessed value of the subject property and comparable properties.

21To enable an estimate of value for the subject property to be derived from suggested comparable properties there must be sufficient elements of similarity, in terms of physical factors such as building area, land area, land frontage, age of construction, physical condition, etc., so as to enable a direct comparison to be made between a suggested comparable property and the subject property.

22The Board has seven sales (Exhibit 2) to consider, in this case, including five sales on the same street as the subject property:

23Sale A – 242 MacPherson Avenue 98 is a two and three-quarter storey semi-detached property originally built in 1910. It has a much smaller total building area (1,834 sq. ft.) and a smaller effective site area (2,772 sq. ft.) than the subject property. It has undergone some maintenance over time and MPAC lists a 1990 renovation year to reflect this. It is assigned a quality class rating of 6.5. It also receives variable adjustments for proximity to commercial (-4%) and proximity to a hydro corridor (-9%). There was a sale in July 2011 for $1,000,000 (time adjusted sale (“t.a.s.”) of $1,025,107). The Board does not find this property to be comparable to the subject given the much smaller site area and building area, the lower quality class and the variable adjustments for proximity to commercial and a hydro corridor, but significantly inferior.

24Sale B – 205 Cottingham Street – is a two and three-quarter storey semi-detached property originally built in 1901. It has a smaller frontage at 19 ft., a much smaller effective site area (2,535 sq. ft.) and a somewhat smaller total building area (2,124 sq. ft.) than the subject property. However, it has a car port for parking. It underwent a total renovation (“D” renovation) in 2012 after the sale in July 2011 for $1,053,000 (t.a.s. $1,079,438) and is now assigned a quality class rating of 7.5. The Board finds this property to be somewhat inferior to the subject property given the smaller frontage, the smaller site area and building area and the fact that the sale took place before the “D” renovation.

25Sale C –188 Cottingham Street – is a two and one-quarter storey semi-detached property originally built in 1890. It has a slightly smaller total building area (2,284 sq. ft.) and effective site area (3,176.60 sq. ft.) than the subject property. The frontage is fairly similar at 22.69 ft. It underwent an extensive renovation (“C” renovation) in 1986. It is assigned a quality class rating of 7.0. There was a sale in May 2012 for $1,581,000 (t.a.s. $1,549,940). The Board finds this property to be superior to the subject property.

26Sale D –192 Cottingham Street – is a two and one-quarter storey semi-detached property originally built in 1904. It has the same frontage (25 ft.) and effective site area (3,500 sq. ft.) and a slightly larger total building area (2,784 sq. ft.) than the subject property. It also has a finished basement. It underwent a total “D” renovation in 1986. There was a sale in July 2012 for $1,599.000 (t.a.s $1,554,018). It is assigned a quality class rating of 7.0. The Board finds this property to be significantly superior to the subject property.

27Sale E – 214 Cottingham Street – is a two and three-quarter storey semi-detached property originally built in 1900. It has a larger frontage (30 ft.) and effective site area (4,246.20 sq. ft.) and a slightly larger total building area (2,743 sq. ft.) than the subject property. It is generally unrenovated but has undergone some maintenance over time and MPAC lists a 1990 renovation year to reflect this. It has a detached garage whereas the subject property does not. It is also assigned a quality class rating of 7.0. There was a sale in November 2011 for $1,595,000 (t.a.s. of $1,523,752). The Board finds this property to be significantly superior to the subject property.

28Sale F – 64 Rathnelly – is a two and three-quarter storey semi-detached property originally built in 1900 and is located nearby as Rathnelly connects Cottingham Street at one point. It has the same frontage but a smaller effective site area (2,351.55 sq. ft.) and a larger total building area (2,967 sq. ft.) than the subject property. There was a small addition in 2008. It has undergone some maintenance over time and MPAC lists a 1990 renovation year to reflect this. It is also assigned a quality class rating of 7.0. There was a sale in September 2012 for $1,350,000 (t.a.s. of $1,350,764). The Board finds this property to be somewhat superior to the subject property.

29Sale G – 236 Cottingham Street – is a two and three-quarter storey semi-detached property originally built in 1895. It has a smaller frontage at 19 ft., a smaller effective site area (2,974 sq. ft.) and a much smaller total building area (1,985 sq. ft.) than the subject property. There was a kitchen renovation in 1999 (“B” renovation code). There is also a shed. It is assigned a quality class rating of 6.5. The property receives a negative 4% variable adjustment for proximity to a pumping station. There was a sale in June 2011 for $1,250,000 (t.a.s. of $1,287,261). The Board does not find this property to be comparable to the subject property given the much smaller frontage and building area, the lower quality class and the variable adjustment for proximity to a pumping station, but inferior.

30Ms. Olsheski was asked by the Board if she had any sales that she was relying on. She referred the Board to sales at 285, 287 and 289 Avenue Road as referenced in her documentary evidence (Exhibit 4). She stated that they were purchased and torn down and that a commercial condominium is being constructed. The Board could not consider these sales as there was no sales information in evidence. It would appear from the documents in evidence that all three properties receive negative variable adjustments for abutting a heavy traffic pattern (-18%) and that 285 and 289 Avenue Road receive a negative 3% adjustment for no parking. Also, 285 Avenue Road receives a negative 4% adjustment for proximity to a commercial property and 289 Avenue Road receives a further negative 6% for abutting a multi-residential property.

31The Board finds the current value of the subject property to be within the range of the time-adjusted sales (t.a.s.) for Sale B of $1,079,438, which the Board finds to be slightly inferior to the subject property and the t.a.s. for Sale F of $1,350,764, which represents the lower end of the range of superior properties. The midpoint is $1,215,101.

32Should this value be adjusted further? Ms. Olsheski raised a number of concerns.

33She took issue with the subject property being assigned a quality class rating of 7.0 and is of the opinion that it should be lowered to 6.5. She referenced the unrenovated condition of her property and a photograph of her house (Exhibit 4) showing a detached eaves trough in need of repair. She also referenced photographs of nearby properties at 312 and 314 Avenue Road that, in her opinion, are in much better condition and have parking and rough iron fencing at the front and yet are assigned a quality class rating of 7.0 like the subject property. Ms. Olsheski referred to other properties with a quality class rating of 6.5 (Exhibit 4 - 258 MacPherson Avenue and 171 Cottingham Street). However, these properties have much smaller total building areas than the subject property. Also, there was no reference to or any quotations presented with respect to work required to correct structural deficiencies (as opposed to routine maintenance and repairs) at the subject property.

34Mr. Stadelmann stated that he has been assigned as an assessor to this neighborhood for many years. Most homes in this neighborhood have been renovated. He added that quality class rating of 6 is assigned to buildings with total building areas of 1,800 sq. ft. A quality class rating of 6.5 is assigned to buildings with total building areas between 2,100 and 2,200 sq. ft., and everything else with total building areas larger than 2,200 sq. ft. is assigned a quality class rating of 7.0 or higher, if totally renovated. The subject property’s condition is considered as average unrenovated. The Board notes that a quality class rating of 7.0 or higher appears to be assigned to those properties in evidence with total building areas larger than 2,200 sq. ft. (the subject has 2,503 sq. ft.) The Board is of the opinion that there is insufficient evidence before it to determine whether the quality class for the subject property should be lowered.

35Ms. Olsheski expressed her concern that she is not getting every benefit to which she should be entitled. Unlike neighboring properties, her property does not receive any variable adjustments other than a negative 3% adjustment for no parking. She has to pay $125 per year for a parking permit for street parking. She added that due to numerous tenants next door at 178 Cottingham Street, there is often no available parking in front of her property for her vehicle. The Board is of the opinion that MPAC has considered the impact of no parking and assigned a negative 3% adjustment. Based on the evidence before the Board, the same negative 3% adjustment has been applied to neighboring properties with no parking such as 285 and 289 Avenue Road (Exhibit 4). The Board is of the opinion that there is insufficient evidence before it to support a further adjustment.

36Regarding a variable adjustment for proximity to heavy traffic, the Board notes that according to the evidence before it, MPAC applies a negative 18% adjustment to properties located on Avenue Road that abut a heavy traffic pattern (Exhibit 4 – 312, 314, 285 and 287 Avenue Road) and not for proximity to a heavy traffic pattern for properties located on side streets such as Cottingham Street where the subject property is located. The Board is of the opinion that there is insufficient evidence before it to support an adjustment.

37The subject property abuts a semi-detached property at 178 Cottingham Street. Ms. Olsheski stated that there are numerous tenants residing there and that her property should receive a negative 6% variable adjustment for abutting a multi-residential property. The Board took a short recess and Mr. Stadelmann checked MPAC’s records and advised that 178 Cottingham Street is a semi-detached property and not a plex property and so there is no basis for a negative 6% variable adjustment for abutting a multi-residential property. However, 178 Cottingham Street does receive a negative 6% adjustment for abutting a four-storey multi-residential property at the rear. The subject property does not receive a negative variable adjustment for proximity to the same four-storey multi-residential property.

38Ms. Olsheski stated the building attracts a low rental and transient clientele and that there is lots of noise. The building also overlooks her backyard as evidenced from the photograph of the view from her backyard (Exhibit 4). The evidence before the Board indicates that 312 Avenue Road that is located close by receives a negative 4% variable adjustment for proximity to a multi-residential property. It would appear that there is some evidence before the Board to support a negative 4% variable adjustment for proximity to a multi-residential property. Based on Ms. Olsheski’s evidence and the photograph (Exhibit 4), the Board finds that the subject property is also subject to the same negative site variable as neighboring semi-detached 178 Cottingham Street, on account of its proximity to the four-storey multi-residential property at the rear of the property and that a negative 4% variable adjustment should be applied.

39The Board also finds that there is insufficient evidence before it to support a 5% variable adjustment for nuisance.

40Based on the foregoing, the Board finds that the value as determined above of $1,215,101 should adjusted for negative variables by a total of 7% to account for the lack of parking (-3%) and proximity to a multi-residential property (-4%) and sets the current value at $1,130,094 or $1,100,000 (rounded).

Equity with Similar Lands in the Vicinity

41The Board must also consider the assessments of similar properties in the vicinity and determine whether the correct current value as established is inequitable relative to those assessments. If so, it should be adjusted to make it equitable, as required by s. 44.(3) of the Act.

42For purposes of establishing equity, properties do not need to be comparable; they need to be of a similar nature and within a reasonable proximity. The ASR from a reasonable sample of sold properties is usually the best indicator for that purpose. Mr. Stadelmann submitted an Equity Analysis (Exhibit 3) that considered 30 arm’s length sales of residential properties within 0.3 kilometres of the subject property that took place between January 2011 and December 2012. They produced a median ASR of 1.01, which is within the acceptable standard of 0.95 to 1.05 required to establish that the level of current value assessments of similar properties are in line with the level of sale prices in the vicinity. Where the subject property’s current value assessment is also at its likely sale value, then there is no basis for a finding of inequity relative to those similar properties.

CONCLUSION

43For the reasons stated below and as directed by s. 44.(3)(a) of the Act, the Board sets the current value of the property, as of the valuation day of January 1, 2016, at $1,100,000 and finds that there is no evidence leading to the conclusion that the current value, as determined above, is not equitable relative to the assessments of similar lands. It requires no further adjustment under s. 44.(3)(b) of the Act.

44Accordingly, for the 2016 taxation year, the assessment is confirmed at $1,100,000.