Assessment Review Board
Commission de révision de l’évaluation foncière
ISSUE DATE: December 4, 2018
Assessed Person(s): William McBride Fluhmann
Appellant(s): William McBride Fluhmann
Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 15
Respondent(s): City of Mississauga
Property Location(s): 585 Shenandoah Drive
Municipality(ies): City of Mississauga
Roll Number(s): 2105-020-027-10900-0000
Appeal Number(s): 3256725
Taxation Year(s): 2017
Hearing Event No.: 690964
Legislative Authority: Section 40 of the Assessment Act, R.S.O. 1990, c. A.31, as amended
Heard: January 22, 2018 by telephone conference
APPEARANCES:
Parties
Representative
William McBride Fluhmann
Self-represented
MPAC
Chris Sitlington
City of Mississauga
No one appeared
DECISION OF THE BOARD DELIVERED BY LESLIE FLEMMING
INTRODUCTION
1585 Shenandoah Drive, Mississauga (the “Subject Property”), is a bungalow located in a neighbourhood of similar properties with mature trees and generally large lots indicative of an older subdivision. The Subject Property was constructed in 1959. The current value returned by MPAC for 2017 of $1,209,000 is based on the value as of January 1, 2016, the valuation day for the assessment cycle from 2017 through 2020. In this case, Mr. Fluhmann is appealing the assessment of $1,209,000, an increase of $294,000 since the last cycle. Mr. Fluhmann’s chief reason for appealing is that he understands that the values in his neighbourhood have gone up an average of 6% since 2012, while his assessment was increased by 8%. Mr. Fluhmann submits that a correct current value for his property would be $1,134,000.
2Mr. Fluhmann represented himself in this appeal hearing and MPAC was represented by Chris Sitlington. Pursuant to s. 40.(11) of the Assessment Act (“Act”), the Municipality is a statutory party to the proceeding and is entitled to be represented at the hearing. In this case, the City of Mississauga was not present.
PRELIMINARY ISSUE
3At the start of the hearing the Assessment Review Board (“Board”) member inquired about the absence of any documentary evidence in the hearing file. Rule 32 of the Rules of Practice and Procedure (the “rules”) provides that appeals are deemed general proceedings unless the Board has specified that the proceeding is a summary proceeding, as this matter is. As a summary proceeding, s. 34 provides that the schedule of events is set out in Schedule B to the rules. The schedule provides that the “parties must file with the Board all documents and any written submissions on which they will rely at the hearing.”
4MPAC’s representative advised that the materials had been served on MPAC in a timely fashion. Board staff advised that the documents had not been received by the Board. MPAC consented to the late filing of the Appellant’s documents and assisted by transmitting an electronic copy to the Board; the hearing proceeded.
REASONS
Background
5Section 44.(3)(b) of the Act, directs the Board to reduce the current value of the Subject Property if similar lands in the vicinity have been assessed at a lower value (“equitable reduction”). The purpose of this provision is to fairly distribute the municipal tax burden according to the value of the property possessed by each ratepayer. In this case, MPAC’s representative testified that an analysis of the level of appraisal for similar properties in the vicinity led to the conclusion that a reduction in the current value was required to make the assessment of the Subject Property equitable with other similar properties. As a result, MPAC recommends an equitable assessment of $1,184,000.
6At the conclusion of the hearing, the Board reserved its decision. For the reasons that follow, the Board finds that the current value of the Subject Property is $1,184,000.
Relevant Legislation
- “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.
8Section 19.(1) of the Act states:
19.(1) Assessment based on current value. – The assessment of land shall be based on its current value.
9Section 19.2(1) of the Act states:
19.2(1) Valuation days – Subject to subsection (5), the day as of which land is valued for a taxation year is determined as follows:
- For each subsequent period consisting of four consecutive taxation years, land is valued as of January 1 of the year preceding the first of those four taxation years.
10Section 40.(17) of the Act states:
40.(17) For 2009 and subsequent taxation years, where value is a ground of appeal, the burden of proof as to the correctness of the current value of the land rests with the assessment corporation.
11Section 44.(3) of the Act states:
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.
ISSUES
12The issue(s) to be determined on this appeal are:
What is the correct current value of the Subject Property as of the valuation day, January 1, 2016 for taxation year, 2017?
Is an adjustment (reduction) in current value required in order to make the assessed value equitable with similar properties in the vicinity?
Discussion, Analysis and Findings
Issue No. 1: What is the correct current value of the Subject Property for the taxation year 2017?
MPAC’S Evidence
13Mr. Sitlington, a property valuation analyst, provided oral testimony for MPAC, relying on the evidence in the form of the Property Valuation Report and Equity Analysis Report produced by his colleague Mark Di Leo, also a property valuation analyst.
14The Subject Property is described as being a single family detached residence not on water located in a neighbourhood identified as A82 and also identified as the Lorne Park area of Mississauga. This area is south of the Queen Elizabeth Way (“QEW”), west of the Credit River, north of Lakeshore Road, and east of Clarkson Road North. The Subject Property is located on an effective site area of 0.28 of an acre, and the home itself is 1,970 square feet (“sq. ft.”) in size with an attached garage of 480 sq. ft. and an outdoor pool of 512 sq. ft., MPAC describes the construction quality as 6.5 out of 10.
15MPAC uses the comparable sales method of determining value rather than the income or cost methods. In order to substantiate the current value assessment, MPAC chose five other single family homes in the area, some of which are in the same neighbourhood and some which are outside of it. All of the proposed comparable homes are located south of the QEW and north of Lakeshore Road and included: 1350 Milton Avenue; 1370 Wateska Boulevard; 1342 Nocturne Court; 1381 Chriseden Drive; and 1089 Springhill Drive. All are single family detached homes built between 1951 and 1961, with site areas ranging between 0.23 acres (Wateska & Springhill) and 0.35 acres (Chriseden). The Nocturne Court property sits on a site area the same size as the Appellant’s actual site area.
16The comparable homes vary somewhat in structural size, with the Subject Property being larger than three of the homes at 1,970 sq. ft. All are one storey. The largest proposed comparable home is 1350 Milton Avenue at 2,063 sq. ft., while 1381 Chriseden Drive and 1089 Springhill Drive are almost the same size at 1,942 and 1,944 sq. ft. respectively. None of the comparable homes has a pool. They all have attached garages of approximately 480 sq. ft., except for 1381 Chriseden Drive which has a smaller garage at 437 sq. ft.
17MPAC’s proposed comparable sales were described in the Valuation Report. Appendix E of the report sets out the “Market Analysis Grid” summarizing the comparative characteristics including structure size, outbuilding size, and lot size. MPAC used sales that had taken place between July 30, 2015 and October 4, 2016. The Appellant challenged the fact that the sales were not closer in time to the valuation day. However, MPAC provided an analysis of the price changes over time based on 530 sales occurring between December, 2013 to December, 2016. The sales were in the vicinity of the Subject Property although they were not necessarily similar to the Subject Property for purposes of this analysis. Given the large number of properties used in the time adjustment study, the Board accepts that the time-adjusted values of the comparable sales are satisfactory as evidence of approximate value as of the valuation day.
Appellant’s Evidence
18The Appellant filed a document that included his submissions respecting value, a map showing the location of the Subject Property, and photographs and some particulars of the Subject Property and two homes in the neighbourhood that he proposed as comparable properties. The Appellant’s main ground of appeal is that MPAC’s investigation of price changes over time as noted on the “About My Property” page of MPAC’s website revealed that the overall change in value over the past four years was 6% per annum. The Appellant calculated that his assessment differed from his neighbours in that it was an increase of 8% per annum. MPAC’s representative responded to this submission by pointing out that the Appellant had successfully appealed his assessment in the previous assessment cycle, which meant that the value of his home was subject to a greater increase than other homes, in order to be equivalent to the increases in value in the market during the last cycle.
19The Appellant’s appeal in the previous assessment cycle resulted in a reduced assessed value of the subject of $915,000. He calculates that, if his property was increased in value by 6% per annum as the website suggested, the current value would be $1,134,000. He attached the three proposed comparable properties (608 Shenandoah Drive, 1408 Shadowa Road and 1399 Shadowa Road) in close proximity to his home to show that each of their assessed values had risen by only approximately 6% as compared to the previous assessment cycle. Unfortunately, none of the properties had been sold during the previous cycle, so no sale prices were available.
Analysis and Finding on Issue One
20The sales of the comparable homes demonstrate that the current value of the Subject Property is supportable. Where the comparable homes were found to be sold for higher prices than the value of the Subject Property, for example 1350 Milton Avenue and 1342 Nocturne Court, they either had a larger lot (Nocturne at 0.34 acres) or a larger residence (Milton at 2,063 sq. ft. compared to the Subject Property at 1,970 sq. ft.). The residences that sold for less than the current value of the Subject Property, such as 1089 Springhill Drive and 1370 Wateska Boulevard have smaller site areas than the Subject Property at 0.23 acres each, and in the case of Wateska, a smaller residence by 383 sq. ft. The comparable sales evidence leads to a logical conclusion that the assessment of $1,209,000 is in an acceptable current value given the sales of the five comparable properties.
Issue No. 2: Is an adjustment (reduction) in current value required in order to make the assessed value equitable with similar properties in the vicinity?
21MPAC’s evidence disclosed that the median assessment to sale ratio of a sample of 30 residential sales in the vicinity of the Subject Property disclosed that a reduction in value was required to make the current value of the Appellant’s residential property equitable with similar properties in the vicinity. MPAC recommended a reduction from the amount of $1,209,000 to $1,184,000.
22The Appellant submits that the correct current value of the 2017 taxation year is $1,134,000, and gave no other evidence on the issue of equity.
23The Board finds that the correct current value is $1,209,000 as per the MPAC assessment based on direct sales. However, because MPAC’s Equity Analysis led MPAC to conclude that similar properties in the vicinity were under-assessed, s. 44.(3)(b) requires that the Board reduce the value of the Subject Property on the ground of equity. MPAC makes the recommendation for equitable reasons that the assessed value be reduced to $1,184,000, and the Board agrees. The correct current value of the Subject Property is $1,209,000. However, in accordance with s. 44 (3)(b) of the Act, the assessment is reduced to $1,184,000.
“Leslie Flemming”
LESLIE FLEMMING
MEMBER
Assessment Review Board
A constituent tribunal of Environment and Land Tribunals Ontario
Website: www.elto.gov.on.ca Telephone: 416-212-6349 Toll Free: 1-866-448-2248```