Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: April 4, 2019

FILE NO.: WR 159298

Assessed Person(s): K.P.

Appellant(s): K.P.

Respondent(s): City of Mississauga

Property Location(s): Withheld

Municipality(ies): City of Mississauga

Roll Number(s): Withheld

Appeal Number(s): 3282366

Taxation Year(s): 2017

Hearing Event No.: 708966 and 710784

Legislative Authority: Section 357(1)(d1) of the Municipal Act, S.O. 2001, c. 25

Heard: December 19, 2018 and March 13, 2019 in Mississauga, Ontario

APPEARANCES:

Parties	Representative
K.P.	Self-represented
City of Mississauga	Sean Doyle

DECISION OF THE BOARD DELIVERED BY DAN WEAGANT

INTRODUCTION

1K.P. (the “Applicant”) filed an application with the City of Mississauga to have her 2017 taxes reduced, cancelled or refunded because she was unable to pay due either to sickness or extreme poverty, under s. 357(1)(d1) of the Municipal Act, S.O. 2001, c. 25 (“Act”).

2The City of Mississauga has passed a by-law, delegating its authority to determine such applications to the Assessment Review Board (the “Board”) under s. 357(11) of the Act.

ISSUE

3The issue before the Board is whether or not the Applicant’s 2017 property taxes should be cancelled, reduced or refunded due to her inability to pay because of sickness or extreme poverty. This requires the Board to determine a number of things. First the Board must determine, based on the evidence at the hearing, if the Applicant was unable to pay her 2017 property taxes. If the Board determines she was unable to pay her property taxes, the Board must then determine if the reason she was unable to pay was either sickness or extreme poverty.

4If the Board determines that the reason was sickness or extreme poverty, the Board must then decide on the amount of the taxes levied to be cancelled, reduced or refunded.

DECISION

5The Board finds that the Applicant did not demonstrate that she was unable to pay the property taxes levied in 2017. The Application is dismissed.

REASONS FOR THE DECISION

Was the Applicant Able to Pay the Property Taxes Levied in 2016?

6The Applicant testified that there are three adults living at the subject property. The Applicant and her brother reside there along with the Applicant’s daughter who enrolled at university in September 2017. She continued to live at home throughout the remainder of 2017.

7In 2017, the household income was comprised of the Applicant’s employment income of $11,725 and her brother’s employment income of $5,612. The Applicant’s daughter did not have an income in 2017. The monthly average income for the household was $1,445.

8The subject property is held by the Applicant, her brother and her father’s estate. Her father died without a will, which has complicated financial matters between the Applicant and her siblings. She testified that she and her brother lead separate lives and that he would like to sell the house to capture the equity in it and move on. The Applicant has resisted that solution so far.

9The Applicant reported that monthly financial activity for the household is transacted through four bank accounts. One of these is in her daughter’s name and the other three are in the name of the Applicant. The total balance on those accounts on January 1, 2017 was -$299. The total balance on December 27, 2017 was $41,048.

10The Applicant submitted that the subject property had a value of approximately $651,000; equivalent to the 2017 assessment. There is no mortgage on the property.

11The Applicant testified that she has an interest in two other properties in addition to the subject property. The first is a family home in Trinidad. This property is jointly held by the Applicant, another brother and her sister in equal portions. She testified that the Trinidad property is worth approximately $800,000 in Trinidad currency. She testified that a Trinidad dollar is worth approximately one sixth of a Canadian dollar. The result is a property worth approximately $133,000 Canadian.

12The second additional property is a rural property in the Township of Amaranth, in Dufferin County. The Applicant testified that this property is approximately 50 acres in size and is worth an estimated $150,000. The Applicant secured a mortgage against this property in the amount of $60,000. She took this mortgage out in order to pay down accumulated debt in several areas, including the monthly payment of tax arrears on the subject property. The net amount advanced by the lender was $41,400 and was deposited to her account on December 28, 2017.

13The City’s tax account for 2017 shows the total amount of $4,656.68 still owing, with an additional $5 in interest applied. The Applicant testified that she has been making $600 per month payments on the account. This practice began after the 2017 taxation year. The taxes levied in 2017 amount to an average of $388.06 per month. No payments on the 2017 taxes were made.

14Monthly expenses reported by the Applicant for 2017 totaled approximately $1,865 per month. This figure was determined from her testimony and the documents submitted. These expenses are summarized as follows (all rounded to the nearest dollar and averaged):

• Groceries & household supplies and clothing - $480;
• Utilities - $419;
• House Insurance - $81;
• Car Expenses (fuel, repairs) - $200;
• Internet, cable, phone - $110; and
• Mortgage payments on Amaranth Township property - $575.

15The Applicant submitted that she requires the equivalent amount paid in property tax to support her household expenses and that a refund of the 2017 taxes paid would allow her family to keep up with the monthly financial commitments incurred in 2017.

City’s Submissions

16The City took no position on how the application should be determined, citing the City’s delegation to the Board. The City submitted that the evidence before the Board strongly suggested that the Applicant was able to pay her property taxes in 2017.

17The City noted that the possession of multiple other properties ought to be considered assets that could have been accessed for funds for the purpose of property tax payments at the subject property.

18Because there were assets available, including a sizable bank balance at the end of the year, the City submitted that the Applicant has proven she was able to pay her property taxes in 2017, but chose not to, and therefore is not eligible for reduction of cancellation of those taxes under the Act.

Board’s Analysis

19A number of salient facts are clear in this case from the evidence submitted. Firstly, the monthly household expenses are higher that the monthly income by an amount of $420. The comparison of monthly income and expense is a common measure used by the Board to calculate if basic household needs can be met, prior to determining if Applicants can meet the property tax obligation.

20However, monthly finances are not the only measure used by the Board to determine if Applicants were able to pay property taxes. The Board regularly reviews overall financial conditions, including mortgage and other debts owing, credit card debt and other loans or commitments.

21In this case, there is no mortgage on the subject property. The Applicant has an interest in two other properties with a total estimated value of approximately $283,000. The Amaranth Township property has a mortgage in the amount of $60,000. The Trinidad property is owned jointly with two of her siblings. These conditions reduce the equity available in the two properties to approximately $134,000.

22The ownership of real estate, other than the property under appeal, has been held by this Board as being an asset that can be used to generate funds to pay expenses, including property tax. The Applicant testified that the Amaranth property’s tax account is in good standing. The only encumbrance against it is the mortgage registered in December 2016. The Applicant testified that she did not want to sell the Amaranth property because she had purchased it with her father, now deceased. She submitted that it has some emotional value for her.

23The Board notes that the Applicant did take on a mortgage at the Amaranth property in recognition that it represented value she could access and that the proceeds could be used to address her accumulated debt, including the taxes for 2017. Together with the interest in the Trinidad property and the bank balance of approximately $41,000 in December 2017, the Board finds that the Applicant had the resources to pay her taxes. A desire to retain assets is not the same as an inability to pay, which is the test the Board must apply in applications under this section of the Act.

24The Board finds that the Applicant has failed to demonstrate that she was unable to pay the property taxes in 2017.

25The application is therefore dismissed.