Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: August 27, 2018

FILE NO.: WR 150892

Assessed Person(s): Ronald Raymond Holmes and Ann Elaine Soucy

Appellant(s): Ann Soucy

Respondent(s): Municipal Property Assessment Corporation (“MPAC”), Region 02

Respondent(s): Tay Valley Township

Property Location(s): Con 12 E., PT. Lot 2

Municipality(ies): Tay Valley Township

Roll Number(s): 0911-916-030-40101-0000

Appeal Number(s): 3233179

Taxation Year(s): 2017

Hearing Event No.: 690368

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

Heard: January 16, 2018 by telephone conference call

APPEARANCES:

Parties	Representative
Ann Soucy	Self-represented
MPAC	Christina Smith
Tay Valley Township	No one appeared

DECISION OF THE BOARD DELIVERED BY LESLIE FLEMMING

BACKGROUND

1Ann Soucy, on behalf of herself and Ronald Raymond Holmes, the owners of the Subject Property, attended the hearing today. The Subject Property is a seasonal/recreational single family residential property not on water. The land is described as a 68-acre parcel of bush and swampland on which sits a small structure described by the Appellant as a hunt camp. MPAC assessed this property at $105,000, a value that the Appellant challenges as being too high. Both Ms. Soucy and the MPAC representative Christina Smith presented well organized evidence in order to assist the Board in clarifying the current value of this property.

2Ms. Soucy (“the Appellant”) has appealed the assessment for taxation year 2017 to the Assessment Review Board (the “Board”) pursuant to s. 40 of the Assessment Act (“Act”). It is her position that the current value assessment is too high and that correct value for the 2017 taxation year is $70,000. At this hearing, MPAC takes the position that the correct current value for the 2017 taxation year is $105,000.

3Also pursuant to the Act, the burden of proof as to the correctness of the current value of the Subject Property rests with MPAC. For the period consisting of the four taxation years from 2017 to 2020, the Subject Property is valued as of the legislated valuation day of January 1, 2016.

4Section 44.(3)(a) of the Act directs the Board to first determine the current value of the Subject Property. Section 44.(3)(b) then 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 appeal, MPAC takes the position that an equitable reduction is not required. The Appellant did not assert that an equitable reduction is required and did not call any evidence on this point. Consequently, this ground of appeal is not an issue in this proceeding.

5Pursuant to s. 40.(11) of the Act, the Tay Valley Township (“the Municipality”), is a party to this proceeding. However, the Municipality did not advise the Board of its position on the issue raised in this appeal, and no one appeared at the hearing on the Municipality’s behalf.

6At the completion 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 $80,000.

Relevant Legislation

7Section 1 of the Act states:

1. “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.(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.

ISSUE

12The issue to be determined on this appeal is:

1. What is the correct current value of the Subject Property for the 2017 taxation year?

EVIDENCE, ANALYSIS AND FINDINGS

13MPAC was represented by Christina Smith, a valuation specialist who is employed by MPAC and who also testified on behalf of the assessment corporation. MPAC chose to use comparable sales in the area with a view to establishing and supporting the current value of the Subject Property. MPAC entered two exhibits: a Valuation Report, and an Equity Analysis Report.

14The Subject Property was described as being a 68-acre parcel of wooded land approximately 20 km, north-west of the Town of Perth improved by a one-storey seasonal residence. The 576 square foot (“sq. ft.”) residence has no sanitary system and is without hydro, but MPAC characterizes it as being of “average” construction, giving it a quality ranking of 3 out of 10. The surrounding lands are described as approximately being 25% swampland with the remaining 75% being mainly forested. Access to the Subject Property is by unmaintained road or road allowance, making such access seasonal.

15MPAC proposes that four properties sold between June 2, 2014 and November 27, 2016 and are comparable with the Subject Property. The relevant details of these properties are as follows:

(1) 2674 Bathurst Road: Sold in October, 2016, for the time-adjusted price of $116,353. This property is thought by both parties to be the most comparable to the Subject Property. It is a 100 acre parcel of mostly forested land improved by a small seasonal dwelling. MPAC’s representative Ms. Smith testified respecting the construction of a sugar shack and pole barn which she states has contributed approximately $3,000 to the value of this property.

(2) 5750 McDonald’s Corner: This seasonal dwelling of 777 sq. ft. is situated on a small lot just under six acres in size. It is located in proximity to a dump or transfer station. Unlike the Subject Property, this property is accessible via a year-round road, and includes a workshop of 564 sq. ft. It also has a well and a bathroom, neither of which exist on the Subject Property. It sold for $142,788 in November, 2015.

(3) 1791 Sheridan Rapids Road: This seasonal dwelling is also located on a small lot of just under seven acres in size. The building is very small, despite being two stories. It is comprised of 196 sq. ft. on the first floor, 153 sq. ft. on the second, and an addition of 43 sq. ft. It has no central heat, no well and no hydro available. In June, 2014, it sold for the time-adjusted price of $71,687.

(4) 789 Ashby Road: This property, just over 44 acres in size, sold in August, 2015, for $117,614. It slightly smaller than the Subject Property, but the topography is similar in that it has approximately 75% of forested land and 25% swamp land. The home, built in 1969 and improved in 1986, has no central heating, plumbing or hydro but apparently has access to those amenities. The dwelling is 810 sq. ft. in size.

16MPAC submits that these comparable properties demonstrate that the correct current value of the Subject Property is $105,000.

17Ms. Soucy testified for the Appellants. She submitted photographs of the Subject Property highlighting the state of the road allowance giving access to the property. She also provided photographs of MPAC’s comparable properties 1, 2 and 3 and another property, 892 Althorpe Road. She also submitted a map of the vicinity, and a copy of the Lanark County Community Forest Management Plan. There were a number of photographs of the seasonal access road (or road allowance) to the Subject Property, plus information on maps and graphs depicting comparable values.

18The Appellant asserts that there are the following inadequacies in the evidence provided by MPAC:

(a) She notes that the only other property in MPAC’s comparables that closely resembles the Subject Property was Sale 1 (2674 Bathurst) which sold for the time-adjusted price of $116,000 in the fall of 2016. The Appellant testified that, while MPAC gave it a slightly higher rating in respect of quality of construction, this property lacks hydro and plumbing, much like the Subject Property. It was 76% to 100% treed, according to MPAC’s records, and lacks the swampy terrain found on some of the Subject Property.

(b) The Appellant notes that the Subject Property is a one-room hunt camp set on a cinder-block foundation, completely lacking in plumbing facilities and electricity. She emphasizes that, because of the very poor nature of the access road, a fact well documented in photographs taken by her, the camp is inaccessible for many months each year.

(c) MPAC’s Sale 2 (5750 McDonald’s Corners) has year-round accessibility and a large garage on site, plus a pond. The Appellant submits that this property is really not at all comparable to the Subject Property because it is classified as a single family residential property and not necessarily a seasonal/recreational property. The Board accepts this submission.

(d) The Appellant notes Sale 3, 1791 Sheridan Rapids Road is a much smaller lot but it does have year-round road access. This property sold for only $71,687 (time-adjusted) in June, 2014. The Board accepts that it is a smaller house on a very small lot by comparison, and that the Subject Property would be more valuable because it has a larger residence and more level topography.

(e) The Appellant completed a “per acre assessment” of the comparable properties supplied by MPAC, and concluded that the Subject Property’s assessed value was $1,544 per acre, which exceeds the value of most of the comparable properties significantly, in some cases by almost $500 per acre.

(f) The Appellant submits that the value of her land should be calculated based on the average per acre value of all the comparables multiplied by the number of acres on the site. The Appellant asserts that the average value of all the comparable properties was $1,081. When multiplied by 68 acres, the resulting value is $73,508, which the Appellant submits is the current value of the Subject Property.

19Both parties agree that the property described as Sale 1, 2674 Bathurst Road, is the most comparable property to the Subject Property. The building on site was similar in terms of quality, amenities and usage. While this property has a $3,000 improvement in the form of a sugar shack and pole barn, and has a slightly better quality of construction than the Subject Property, it is a smaller cabin.

20As the other structures are situated on much smaller sites, most of which are accessible year round, the Board rejects the Appellant’s submission that an average of the per-acre values of the four comparable properties be used to calculate the current value of the Subject Property. Instead, the Board finds that it should use the per acre value calculated using the sale of the best comparable property, 2674 Bathurst Road, which is $1,163.53 per acre. Utilizing this per acre value, the current value of the Subject Property is $80,000 (rounded).

DECISION

21The Board reduces the current value of the Subject Property for the 2017 taxation year from $105,000 to $80,000.