Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: December 16, 2019 FILE NO.: WR 161742

Assessed Person(s)/Appellant(s): Elaine Stewart Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 32 Respondent(s): Township of Kenora

Property Location(s): 416 Front Street Municipality(ies): Town of Kenora Roll Number(s): 6016-122-001-17300-0000 Appeal Number(s): 3328878 and 3368206 Taxation Year(s): 2018 and 2019 Hearing Event No.: 719866

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

Heard: June 18, 2019 in Kenora, Ontario

APPEARANCES:

Parties	Representative
Elaine Stewart	Eric Stewart
MPAC	Brendon Penner
Town of Kenora	Rachel Jaworowicz and Michelle Saunders

DECISION OF THE BOARD DELIVERED BY MARK SPRAGGETT

INTRODUCTION

1Elaine Stewart is the owner of 416 Front Street, a residential dwelling on Lake of the Woods, in the City of Kenora (the “Subject Property”). Eric Stewart is the son of the assessed person acting as her representative.

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.

3For the 2018 and 2019 taxation years under appeal, MPAC has assessed the current value as returned at $325,000 for the Subject Property. That value is apportioned 100% in the residential property class.

4Elaine Stewart (the “Appellant”) filed an appeal for the 2018 taxation year with the Assessment Review Board (the “Board”), and she has been deemed to have brought the same appeal with respect to the Subject Property for the 2019 taxation year pursuant to s. 40(26) of the Act. It is the Appellant’s position that MPAC’s assessment of current value is too high and that the correct current value is $285,000. MPAC took the position at the hearing that its assessed value is correct.

5Pursuant to s. 40(11) of the Act, the Town of Kenora is a party to the proceeding. However, it did not advise the Board of its position on the issues raised in these appeals.

6Subsection 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. The purpose of this provision is to fairly distribute the municipal tax burden according to the value possessed by each ratepayer.

7MPAC took the position that an equitable reduction is not required. The Appellant did not assert that an equitable reduction is required. Therefore, in this proceeding, this ground for appeal is not in issue.

8At the completion of the hearing, the Board reserved its decision. For the reasons that follow, the Board finds that for the 2018 and 2019 taxation years, the correct current value of the Subject Property is $325,000.

RELEVANT RULES AND LEGISLATION

9The 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.

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

10The issue to be determined in this appeal is the correct current value of the Subject Property for the taxation years 2018 and 2019

PROPERTY DESCRIPTION

11The Subject Property is a residential dwelling located in the former town of Keewatin area within the City of Kenora on the shores of Lake of the Woods. It is located in what is considered the “Premier Boating Destination of North America”. The property has an effective frontage of 42.57 feet and an effective depth of 106.69 feet. The effective site area is 0.104 acres. MPAC has assigned the Subject Property a quality 5 classification.

DISCUSSION, ANALYSIS AND FINDINGS

MPAC’s Evidence

12Brendon Penner represented MPAC at the hearing and filed a Valuation Report dated December 18, 2018.

13Mr. Penner submitted into evidence minutes of settlement for the 2017 tax year that were agreed to and signed by the Appellant, accepting the recommended assessment of $325,000.

14Mr. Penner relied on the Direct Comparison Approach to confirm MPAC’s opinion of current value.

15Applying the Direct Comparison Approach Mr. Penner used a qualitative analysis applying a relative comparison analysis. This analysis deals with the relationships indicated by the market data without recourse to quantification.

16Relying on MPAC’s corporate database for sales information, Mr. Penner first identified six suggested comparable properties in the vicinity of the Subject Property to determine the value for the Subject Property. They are as follows:

Sale Number	Roll Number	Address	Comparability to Subject Property	Time Adjusted Sale Price (TAS)
1	601612200118900	210 Front Street	Superior	$487,000
2	601612200125600	419 Belle Avenue	Relatively Comparable	$448,000
3	601612300103500	823 Beach Road	Superior	$594,000
4	601604000404900	844 Robertson Street	Inferior	$326,000
5	601601000202900	411 Lakeview Drive	Superior	$411,000
6	601604000302100	104 Lakeside Crescent	Inferior	$268,000

17Mr. Penner testified that by selecting sold properties that are inferior, superior and similar to the Subject Property, allowed him to establish a probable range of current value by bracketing the Subject Property between the sold properties that are inferior and superior to it.

18For the Subject Property, Mr. Penner estimates the current value based on the sale prices of the most similar properties to be $324,000.

MPAC’s Submissions

19MPAC disagrees with the Appellant’s characterization that the Subject Property’s lot size is average for the area. MPAC submits that a lot size of 50 feet x 150 feet is considered average for the area.

20MPAC disputes the valuation date of the Appellant’s appraisal report, arguing that December 18, 2018 is beyond the January 1, 2016 valuation date.

Appellant’s Evidence

21Eric Stewart relied on a third-party prepared appraisal document as his evidence. The author of the appraisal document was not at the hearing.

22Mr. Stewart testified that the correct current value for the Subject Property is $285,000.

FINDINGS

23The best evidence available to the Board in the determination of current value, are the six suggested comparable properties submitted by MPAC in support of its analysis using the Direct Comparison Approach.

24MPAC’s properties offered elements of comparison to the Subject Property in terms of location, neighbourhood, local amenities, type of properties, size, age, structure and sales data within a reasonable time horizon relative to the valuation date of January 1, 2016.

25The Appellant’s evidence of a third-party appraisal of the Subject Property could not be used to make a determination of current value. Some of the suggested comparable properties were not of the same type, had improvements that were not considered, and property locations were not within a reasonable proximity. Furthermore, adjustments were made without details as to how the adjustment values were derived. In addition, it appears that no time adjustments were made to the sale prices. Lastly, some of the lot sizes were not comparable to the Subject Property. Given the extent of uncertainty to the accuracy of the appraisal document’s data, the Board is not persuaded to refer to this evidence in its determination of current value.

26Factoring in the fact that finding similar properties can be challenging in this location and that value criteria vary significantly in the Lake of the Woods Region, the Board is persuaded that MPAC’s returned value is a reasonable reflection of current value.

27The Board finds as reasonable a current value of $325,000 for both taxation years.

DECISION

28The correct current value of the Subject Property is $325,000 for the 2018 and 2019 taxation years.