Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: May 02, 2019

FILE NO.: WR 159392

Assessed Person(s): Arlene F. M. Jagosky

Appellant(s): Arlene F. M. Jagosky

Respondent(s): Town of Huntsville

Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 17

Property Location(s): 285 Lakeshore Road

Municipality(ies): Town of Huntsville

Roll Number(s): 4442-020-002-04700-0000

Appeal Number(s): 3324968 and 3362782 (deemed 2019 appeal)

Taxation Year(s): 2018 and 2019 (deemed appeal)

Hearing Event No.: 710965

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

Heard: March 18, 2019 in Huntsville, Ontario

APPEARANCES:

Parties

Counsel⁺/Representative

Arlene F. M. Jagosky

Robert Jagosky

MPAC

Terri McLean

Town of Huntsville

No one appeared

DECISION OF THE BOARD DELIVERED BY VINCENT STABILE

INTRODUCTION

1The subject property is a single-storey detached residential dwelling on the water built in 1956 with a building area of 1,965 square feet. It has an unfinished basement area of 1,157 square feet. The quality of construction is 6. It has four secondary structures: a carport of 160 square feet, quality of construction ‘1’, and a workshop of 284 square feet, quality of construction ‘2’, both built in 1988. It also has a detached garage of 696 square feet, quality of construction ‘2’, built in 1991 as well as boathouse of 1,072 square feet, quality of construction ‘3’, built in 1995.

2According to the MPAC profile, the property has an effective water frontage of 140 feet and an effective site area of 1.59 acres.

3For the January 1, 2016 valuation date, MPAC returned the assessment at $414,000. The property is situated in neighbourhood C80-966.

4The parties agree that the valuation day is January 1, 2016. The assessor has used the direct sales comparison approach to determine current value, relying on six (6) sale transactions of properties in the vicinity.

5Arlene F.M. Jagosky (the “Appellant”) agrees to the direct sales comparison approach, but argues that the subject property should receive more negative adjustments, considering its specific attributes. The Appellant did not provide comparable sales data.

ISSUE

6The issue to be determined is the correct current value of the property as of January 1, 2016.

DECISION

7I have determined that the correct current value for the 2018 taxation years is $290,000. Further, I determined that no adjustment for equity is warranted. Accordingly, the assessed value for the taxation years 2018 and 2019, based on the valuation day of January 1, 2016, shall be reduced from $414,000 to $290,000.

EVIDENCE

MPAC

8The assessor, Terri McLean, filed a Valuation Report proposing an assessment of $414,000 as of January 1, 2016 (Valuation Day) using the direct comparison approach. She proposed the sales of six (6) comparable properties sold from August 2014 to November 2017, with a range of values of $445,000 to $689,000.

9She stated that the subject property receives a total of 51% negative adjustment comprising the following:

(i) Being part of the homocode C80 (“Code C80”), as due all other properties within code C80 – 10%;

(ii) Extremely heavy traffic – 20%;

(iii) Abuts Hydro corridor – 10%;

(iv) Abuts Nuisance – public trail – 8%; and

(v) Shallow water/Northern exposure – 3%.

10In respect to negative adjustments, 33% have been carried over from WR 25837, Jagosky v. Municipal Property Assessment Corp., Region No. 17, [2003] O.A.R.B.D. No. 420, a Board decision relating to the 2003 taxation year. MPAC has increased the adjustments over time. Based on the proposed comparable properties, the assessor determined the correct current value to be $625,000. At page 7 of her report, the assessor states that the subject property has a total of 38% negative adjustment but notes that if the 38% was removed, considering how this adjustment is applied by the model used by MPAC, there would be an actual increase of $211,000, or 51%, to the returned assessment of $414,000 resulting in a correct current value to $625,000.

11In response to some of the submissions of the Appellant, the assessor stated that the value of the land predominantly relates to the water frontage. That value would not change even if the total site area were reduced by 50%.

Appellant

12The Appellant did not file evidence of sales. Mr. Jagosky submitted that the proposed value of $625,000 may well be correct, however stated that the adjustments, as calculated by MPAC, are not sufficient and any event do not add up to 51% as submitted by the assessor.

13He submitted that the public trail on and along the subject property used for many years was formally delineated in 2017. As a result, one half of the site area now in under the dominion and control of the Ministry of Transportation, Ontario (MTO). Although not formally expropriated, Mr. Jagosky submits it is simply another form of expropriation. In fact MTO has requested he move the garage which is partly on that portion of the land. Further, he stated that the water frontage of the subject property has been effectively reduced by about 50%.

14Mr. Jagosky observed that if the proposed value of $625,000 was reduced by 51% ($318,750), as submitted by MPAC, it would result in an assessment of $306,250 (306,000 rounded).

LEGISLATION

15Section 44.(3)(a) of the Assessment Act, R. S. O 1990, c A.31 (the “Act”) requires this Assessment Review Board (this “Board”) to “determine the current value of the land.” Current value is defined in s. 1 as “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.” That is, the Board must determine what the subject property would have sold for in an arm’s length transaction on the relevant valuation day, set pursuant to s. 19.3 of the Act, in this case January 1, 2016 for the 2018 and 2019 taxation years.

16Once the current value has been determined, s. 44.(3)(b) requires that the Board “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” but only if that adjustment would result in a reduction of the assessment.

17In addition to the 2018 appeal filed by Mr. Jagosky, there is a 2019 taxation year appeal before the Board. This is because subsection 40(26) deems that the same appeal is brought for the 2019 taxation year if the 2018 appeal is not finally disposed of by March 31, 2019.

ANALYSIS

18On the evidence received relating to the public trail, which existed for many years and formally delineated with fencing along the perimeter of the subject property in 2017, I am satisfied that the site area should be changed to 0.85 acres, as had been determined in WR 25837. Further, the effective water frontage may also require adjustment, subject to better evidence following the 2017 delineation. That is beyond the scope of the appeals before me since the valuation date under consideration is January 1, 2016.

19I accept the negative adjustment of 51% proposed by MPAC as being reasonable and consistent with previous Board decisions.

20I am satisfied that the direct sales comparison approach is appropriate in this case.

21The assessor has proposed six comparable properties proposed in the vicinity. There is substantial variation relating to water frontage, site area, the year built and negative adjustment applied due to their location.

22I accept the assessors’ submission that the water frontage is a major factor when determining value of water front properties. However, I did not receive compelling evidence to quantify that factor specifically.

23Comparable Property #1, the highest sale at $689,000 has the largest waterfront at 210 feet whereas Property #6, the lowest of the sales at $445,000, was the smallest waterfront at 96 feet. Two of the comparable properties (Property #3 and property #4) have adjustments for heavy traffic and the other four have no other adjustments, except 10% for the Code 80. Regardless, those adjustments would affect assessed value and not the actual sales.

24The comparable properties relied upon by the assessor range in value from $445,000 to $689,000.

25The comparable properties proposed are either superior or inferior to the subject property. Properties #2, #3 and #4 are closest to the subject, but do not suffer from the proximity of the public trail. The average of those three sales is $592,000 (rounded).The average of all six comparable properties is $579,000 (rounded). Considering the range of sales of the proposed comparable properties, I find the average sale of $579,000 to be the reasonable correct current value, before further adjustments.

26I have been unable to justify the submission of the assessor at arriving at $625,000 by deducting 38% from the returned assessment of $414,000. The method proposed does not make sense. The starting point should be to determine the correct current value, prior to adjustments. The result should be discernible and capable of being proven mathematically.

27The proposed total negative adjustment for the subject property is 51% which I have accepted as reasonable. Accordingly, I will reduce my finding of the correct current value of $579,000 by 51% ($289,170 or 289,000 rounded) resulting in $290,000. I observe that applying the average of $592,000 of the three sales in closest in proximity to the subject property, would have a similar result. I find $290,000 to be the most likely current value of the subject property, after adjustments.

EQUITY

28The assessor filed an Assessment to Sales Ratio (“ASR”) study of thirty (30) properties resulting in a median ASR of 0.979 with a Coefficient of Dispersion (COD) of 6.9 indicating that, on average, the individual ARS’s differ 6.9% from the median ASR. The assessor submits that according to Standard of Ratio Studies by the International Association of Assessing Officers (IAAO), COD’s of not more than 15 are required for residential properties. The 6.9% result in this study therefore is acceptable. Although the Board prefers to apply the mean ASR, in this study the mean is 0.9502. The result would not vary.

29The assessor stated that equity was achieved if the median ASR falls between 0.95 - 1.05.

30The Appellant did not present any evidence on equity and did not challenge the results of the study as proposed by the assessor in any meaningful way.

31Therefore, I accept the evidence from the assessor as being the best evidence on the issue of equity. No adjustment will be made for equity.

CONCLUSION

32I have determined that the correct current value, after adjustments, for the 2018 and 2019 taxation years is $290,000. Further, I find that no reduction for equity is warranted. Accordingly, the assessment for the 2018 and 2019 taxation years, based on a valuation date of January 1, 2016, is reduced from $414,000 to $290,000.