Alain Siebert v. Municipal Property Assessment Corporation Region 29, 2018 CanLII 86697

Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: September 13, 2018

FILE NO.: WR 154445

Assessed Person(s): Alain Siebert

Appellant(s): Alain Siebert

Respondent(s): Municipal Property Assessment Corporation Region 29

Respondent(s): Town of Kirkland Lake

Property Location(s): 633 Government Road West

Municipality(ies): Town of Kirkland Lake

Roll Number(s): 5468-000-002-12500-0000

Appeal Number(s): 3254880 and 3314393

Taxation Year(s): 2017 and 2018

Hearing Event No. 700669

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

Heard: July 17, 2018 by telephone conference call

APPEARANCES:

Parties

Representative

Alain Siebert

Self-represented

MPAC

Tyler Allard

Town of Kirkland Lake

No one appeared

DECISION OF THE BOARD DELIVERED BY JENNIFER GRIFFITH

Background

1Alain Siebert is the owner of 633 Government Road West (the “Subject Property”), which is located in the Town of Kirkland Lake.

2Pursuant to the provisions of the Assessment Act, R.S.O. 1990, c. A.31 (the “Act“), the assessment of land shall be based on its current value. The Act also provides that, for the 2017 to 2020 taxation years, MPAC is required to assess this value as of the valuation date, January 1, 2016 (“current value”).

3MPAC has assessed the current value of the Subject Property at $130,000 for the 2017 taxation year and at $127,000 for the 2018 taxation year.

4Alain Siebert (the “Appellant”) has filed appeals for taxation years 2017 to 2018 with the Assessment Review Board (the “Board”), pursuant to s. 40 of the Act. It is his position that MPAC’s assessment of current value is too high and that the correct current value should be in the range of $89,000 to $100,000. At this hearing, MPAC takes the position that its assessed value should be $119,000 for the 2017 and 2018 taxation years.

5Pursuant to s. 40.(11) of the Act, the Town of Kirkland Lake is a party to this proceeding. However, no one appeared at the hearing on its behalf.

6Section 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. MPAC takes the position that an equitable reduction is not required. The Appellant asserts no position on equity. Therefore, equity is not at issue at this hearing.

7At the completion of the hearing, the Board reserved its decision. For the reasons that follow, the Board finds that the current value for 2017 to 2018 tax years is $119,000. An equitable reduction of this value is not required.

Relevant Legislation

8The relevant sections of the Act are as follows:

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.

19.(1) Assessment based on current value. – The assessment of land shall be based on its current value.

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:

4. For the period consisting of the four taxation years from 2017 to 2020, land is valued as of January 1, 2016.

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.

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

9The issue to be determined on this appeal is the correct current value of the Subject Property for the taxation years 2017 and 2018.

Description of the Subject Property

10The Subject Property is a two-storey, single family detached dwelling, located at 633 Government Road West, in the Town of Kirkland Lake. The Subject Property was built in 1937 and with an effective year built of 1972. In 1980 the Subject Property underwent some interior work; in 1990 an addition was added to the rear of the house; and in 1998 it had underwent some exterior work. The Subject Property has a total building area of 1,855 square feet (“sq. ft.”), and a total lot size of 0.05 acres.

DISCUSSION, ANALYSIS AND FINDINGS

MPAC’s Evidence

11Tyler Allard represented MPAC. Mr. Allard presents a Valuation Report, dated December 13, 2017, which he prepared and testifies to the information contained in the report.

12Mr. Allard states that the assessed value of the Subject Property includes a negative 10 percent adjustment for structural damages which was carried forward from a previous 2013 appeal. He also testified that the 2018 assessed value was returned at $127,000 in response to a Request for Reconsideration (“RFR”) which was rejected by the Appellant.

13Mr. Allard states that he inspected the Subject Property on October 4, 2017, and observed cracks in the block foundation and in some areas of the drywall; and that the shed was below average condition. Based on his findings, he increased the negative adjustment for the cracks to the foundation and drywall by 5 percent ($6,500), and applied a negative adjustment of $2,000 for the shed. These two adjustments changed the returned assessed value to $121,500 ($130,000 - $8,500).

14In support of current value, Mr. Allard presents an analysis of six sales (five of which are located on the same street as the Subject Property). The analysis contained both actual and time adjusted sale prices. These suggested comparable properties are located at 638 Government Road West, sold in 2013; at 860 Government Road West, sold in 2017; at 821 Government Road West, sold in 2015; at 26 Wye Street, sold in 2013; at 852 Government Road West, sold in 2012; and at 709 Government Road W, sold in 2015.

15The analysis shows that four sales occurred in 2012, 2013 and 2017, well outside the valuation date of January 1, 2016. The remaining two sales at 821 Government Road West, sold in 2015 at a time adjusted rate of $109,750; and at 709 Government Road West, sold in 2015 at a time adjusted rate of $150,777. Mr. Allard testifies that the suggested comparable property at 709 Government Road West is inferior to the Subject Property and is significantly smaller in total building area (836 sq. ft. smaller). However, he stated that he considers the suggested comparable property at 821 Government Road West the most comparable property to the Subject Property due to its similar condition and year built.

16The suggested comparable property at 821 Government Road West has a total building area 1,686 sq. ft., a lot size 0.11 acre, and sold at an adjusted sale price of $65.10 per sq. ft. based on total building area. Applying the adjusted sale price of $65.10 to the Subject Property it results in a value of $120,760. Mr. Allard has stated that the value of $120,760, when it is adjusted for differences in total building area and basement with the Subject Property, it results in a value of $119,000.

MPAC’s Submissions

17MPAC submits that the structural damages experienced by the Subject Property are not unique, and are experienced by the suggested comparable properties on Government Road West.

18Relying on its evidence, MPAC submits that the correct current value for the taxation years 2017 to 2018 is $119,000.

Appellants’ Submissions

19Mr. Siebert did not file any disclosure with the Board. He testifies that the Subject Property is in poor condition, with old carpet, cracked foundation and ceramics, old windows, and leaky basement. Mr. Siebert states that the Subject Property is located close to a pond, which he believes contributes to the structural damages of the Subject Property.

20Mr. Siebert is of the view that it would cost approximately $30,000 to renovate the Subject Property in order to sell it for the recommended value of $119,000. He also testifies that a property next door to the Subject Property was condemned due to similar problems.

21Relying on his evidence, Mr. Siebert submits that the correct current value for taxation years 2017 to 2018 should be in the range of $89,000 to $100,000.

Findings on Issue 1

22Under s. 44.(3)(a) of the Act, the Board must determine “the current value of the land.” The best evidence the Board can receive of current value is an arm’s length and market-tested sale of the property on the valuation date or close to it. When that evidence is unavailable, the sales of similar properties on or near the valuation day, is the next best evidence of value.

23Based on the evidence presented in support of current value, the Board accepts MPAC’s recommendation of $119,000, based on the sale of a relatively comparable property on the same street as the Subject Property and exposed to similar conditions in the area.

24On the contrary, the Appellant presents no sales evidence, and presents no professional contractor’s estimate or engineer assessment of what it would cost to cure the poor condition of the Subject Property. Therefore, the Board rejects the Appellant’s view of a cost-to-cure value of $30,000, and the view that the correct current value should be in the range of $89,000 to $100,000.

DECISION

25The current value of the Subject Property is $119,000 for the 2017 and 2018 taxation years. The Board therefore reduces the assessment for the 2017 taxation eyar from $130,000 to $119,000 and reduces the assessment for the 2018 taxation year from $127,000 to $119,000.