Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: July 05, 2018

FILE NO.: WR 151794

Assessed Person(s): Franklin Earle Inche

Appellant(s): Franklin Earle Inche

Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 16

Respondent(s): Township of Severn

Property Location(s): 1402 Thorburn Road

Municipality(ies): Township of Severn

Roll Number(s): 4351-010-001-11401-0000

Appeal Number(s): 3189491

Taxation Year(s): 2016

Hearing Event No.: 694966

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

Heard: March 8, 2018 by teleconference call

APPEARANCES:

Parties	Representative
Franklin Inche	Self-represented
MPAC	Ziad Al-Hillal
Township of Severn	No one appeared

MEMORANDUM OF ORAL DECISION DELIVERED BY LESLIE FLEMMING ON MARCH 8, 2018

REASONS

Background

1Franklin Inche is the owner of a rural residential property at 1402 Thorburn Road in the Township of Severn. Mr. Inche testified that the land belonged to his parents and was given to him. He has lived there for many years. The property is two acres in size, and the residence is a small home of 960 square feet (“sq. ft.”). There is also a detached barn on the property of 1,280 sq. ft. While being in a rural location, this property is not farmed. It is located approximately 11 kilometers (“km”) northwest of Orillia and 35 km away from Barrie.

2Pursuant to the provisions of the Assessment Act (“Act “), municipal property taxes are assessed on an annual basis, and the calculation of the tax payable is based on property value. The Act requires that MPAC conduct a general reassessment of a property’s value every four years. For the 2013 to 2016 assessment cycle, the Act specifies that the valuation date for this general reassessment is January 1, 2012. The Act further provides that the annual assessment for each of the four taxation years will be based on the value determined by MPAC in its general reassessment, unless there has been a subsequent change in circumstances.

3The assessment for the 2016 taxation year is the subject of today’s appeal. The property is assessed in the amount of $244,000, and Mr. Inche argues that this is too high for a number of reasons which relate to the nuisance caused by a nearby quarry, a change in the layout of the road, the proximity of a police firing range, and the presence of unsightly telephone/hydro lines running diagonally the length of his property.

4Pursuant to s. 40(11) of the Act, the Township of Severn (“Municipality”), is a party to this proceeding. However, the Municipality did not advise the Assessment Review Board (“Board”) of its position on the issues raised in these appeals, and no one appeared at the hearing on the Municipality’s behalf.

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, the Appellant did not assert that an equitable reduction is required. MPAC takes the position that an equitable reduction is not required. Therefore, in this proceeding this ground of appeal is not in issue.

6At the completion of the hearing, the Board delivered the decision orally. For the reasons that follow, the Board finds that the 2016 current value is $244,000.

Relevant Legislation and Rules

7Section 1 of the Act states:

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:

3. 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.(7) 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 to be determined on this appeal is:

1. What is the correct 2016 current value of the subject property for the assessment for taxation year 2016?

MPAC’s Evidence and Submissions

13Ziad Al-Hillal, a Property Valuation Analyst with MPAC, gave evidence for the Assessor. He presented his Valuation Report and Equity Analysis Report. The subject property is a one-bedroom home of 960 sq. ft. It has two-bathrooms and an unfinished basement. There is a detached barn on the property which is 1,280 sq. ft. in size. MPAC used the direct sales comparison method of determining value, and bases its market analysis on seven rural residential properties. MPAC concluded that the value of the subject property as of January 1, 2012 (the valuation day) was $244,000.

14The seven comparable properties ranged from 4.05 km away from the subject property to 8.3 km away. Sale prices ranged from $200,000 for two properties (1379 Wainman Line and 1623 Dunns Line) which were 1.2 and 1.0 acres respectively, with residences measuring 1,317 sq. ft. and 1,352 sq. ft. respectively. Properties that were found to be more expensive than the subject property were 3566 Fairgrounds Road, sold for $300,000 in June, 2012, and 1303 Clearview Drive, sold for $250,000 in June of 2011. These properties were sold at values higher than the subject property. The Fairgrounds Road property features a home of 1,315 sq. ft. in size, and a lot less than half the size of the subject property, although it has an attached garage of 480 sq. ft. The Clearview Drive property features a 1,049 sq. ft. home, and a small lot of approximately 1/3 of an acre.

15MPAC also used time-adjusted values in its materials, which were based on 240 residential sales in the vicinity. Mr. Inche did not object to the time adjustments; however, the values described in the preceding paragraph were based on actual sale amounts without adjustment.

16Mr. Al-Hillal pointed out that the subject property is the largest of the eight properties being compared and its barn is larger than any of the other properties’ garages. The mean value of the seven comparable sales is $235,000. Because the subject property is larger than the other comparables, MPAC determined that a value $9,000 above the mean was fair.

The Appellant’s Evidence and Submissions

17Mr. Inche testified on his own behalf. During his cross-examination of the Assessor, he introduced evidence respecting the following issues with the property, upon which he elaborated during evidence in chief:

a) All of the comparable sales chosen are located farther away from the local quarry which operates 1.3 km away from the subject property in a southwesterly direction. The quarry is the cause of constant noise, steady traffic, and a source of dust and dirt when the wind is blowing. As time goes by, the quarry operations move closer and closer to his property.

b) The road passing his property was straightened by the municipality, eliminating an “S” curve which then allowed the speed limit to increase to 80 km per hour.

c) The driveway is now longer than it was, and more expensive to maintain.

d) There are hydro/telephone poles crossing his land in a diagonal way from the north-east to the southwest corner of the property. This is unsightly and detracts from the potential resale value of the home.

e) The property is located close to the land used by the Ontario Provincial Police on Burnside Line for gun training. There is frequent loud noise from the range.

18Mr. Inche’s biggest concern is the effect of the quarry operation on the value of his land. However, he was unable to provide any information respecting the potential loss of value caused by each of the nuisance factors. Mr. Inche submitted that these factors contributed to a loss of value and asked the Board to consider reducing the assessment.

Board’s Analysis and Findings

19The onus is on the Assessor to prove on a balance of probabilities that the current value of the land, on which the assessment must be based, is an amount which is supportable using an acceptable assessment methodology. In this case MPAC has provided the Board with seven similar properties in the vicinity. Because this is a rural township, the vicinity is larger than it might be in an urban or suburban setting. In any case, using the comparable sales of seven similar rural residential properties, all slightly smaller than the subject property, MPAC has met its burden and substantiated the assessment at $244,000 as reasonable. MPAC has used a technique called “bracketing”, whereby some of the comparable properties have sold for more than the subject property’s assessment, and others have sold for less. The valuation placed on the subject property is reasonable on a balance of probabilities. The seven comparable sales properties were reasonably similar to the subject property which lends validity to the assessment.

20The Board appreciates that the existence of the nuisance factors outlined in the Appellant’s testimony may in fact lead to a reduction in the sales value of the subject property. However, the Board is only able to make a decision on the evidence before it. While the Appellant provided a comprehensive description the property and its challenges, he did not provide any evidence to support his argument that the nuisance factors would reduce the value of the subject property.

DECISION

21The current value of the subject property is $244,000. The Board confirms the 2016 assessment in this amount.