American inventor and signer of the Declaration of Independence, Benjamin Franklin has been widely credited with coining the phrase “…in this world, nothing is certain except death and taxes.” Although that may be so, at least property owners in a municipality may appeal their assessments each year and possibly catch a lucky break on the amount of tax they pay.
Both residential and commercial property assessments and the appeal process is governed by the Municipal Government Act, RSA 2000, c M-26 https://canlii.ca/t/55760. Shortly after the start of a New Year, a municipality’s Property Assessment service will mail out assessment notices to various property owners’ mailing addresses as associated with the Certificates of Title for such properties as registered with the Province’s Land Titles Registry. The Review Period runs from January 5-March 14th. So, if a property owner wishes to challenge the assessed value of a home, land or commercial property as the case might be, notice must be returned to the Assessment service by March 14th.
There are two components to property taxes: the mill rate and the assessed value of the property itself. The mill rate is a fraction of a percentage point that is set by a municipal council each year based on its projected budget for the year. The assessed value of the property itself is based on a market value of the property in relation to other similar properties as of July 1 of the preceding year. The mill rate itself cannot be challenged. However, if a property owner can lead evidence that there is some factor or combination of factors that has negatively affected the property’s value, that is something with can be adjusted for on appeal. Another way to challenge an assessment would be to successfully lead evidence that the municipality’s Property Assessment service has based its market value assessment on other properties that were indeed not comparable.
The body that hears appeals is the Assessment Review Board (ARB) which is comprised of paid appointees who are independent of the Assessment service. They sit as three-person panels, with one person acting as the Presiding Officer (the panel Chair in other words), and they usually have familiarity with real estate matters, so it is common to see active and retired lawyers or realtors among their ranks. The ARB is a quasi-judicial body which takes its authority under the Municipal Government Act. It is not bound by prior decisions of other ARBs, although may regard such decisions as persuasive if they dealt with similar issues.
An ARB is also not bound to follow the strict rules of evidence to which courts must adhere, which lends a less formalistic tone to hearings. However, this is not to say there are no rules either. The ARB enjoys the status of a quasi-judicial body, which means that it must give a fair hearing to both the municipality’s property assessor and the property owner. Although the hearings are designed to give both parties an opportunity to present their evidence and arguments in a less formalistic environment than a court, the parties may be represented by counsel or agents should they wish. As quasi-judicial tribunals, an ARB panel is expected to conduct itself in accordance with a legal principle known as “natural justice”. There are two main parts to the principle of “natural justice”: 1) the duty to be fair, which refers to the obligation to hear both sides of a dispute and includes the duty to be fair; and 2) the rule against bias, which refers to the obligation for decision makers to be objective, impartial, and independent.
The Municipal Government Act establishes a municipal taxation system based on the market values of properties within its jurisdiction. There are two fundamental principles in this process: 1) correctness; property should be assessed in accordance with the legislative and regulatory rules as set by the legislature; and 2) fairness and equity; i.e. assessments of similar properties in the same municipality should be similar to each other. An ARB cannot by its own initiative conduct a hearing into taxation and assessment matters. It cannot address the level of taxes but can only ensure that the basis on which the property has been assessed was correct, fair, and equitable in relation to other similarly situated properties of comparable value. There are several legislative requirements, including: 1) the appeal cannot be about the assessment of linear property (for example, a power line or cable line); 2) the appeal was filed in time, so on or before March 14th; 3) the ARB must render a decision within 150 days of the assessment notice or tax notice being issued; and 4) the requisite filing fee was paid.