STAFF REPORT. Committee of the Whole FROM: Provincial Parks Property Assessment Appeal. DATE: October 18 th, Monica Quinlan, Treasurer

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1 STAFF REPORT TO: FROM: SUBJECT: Committee of the Whole Monica Quinlan, Treasurer Provincial Parks Property Assessment Appeal DATE: October 18 th, 2016 RECOMMENDATION THAT Committee of the Whole recommends to Council that it authorize the Treasurer to move forward with the proposed minutes of settlement regarding the Provincial Parks Property Assessment. BACKGROUND At the October 4 th, 2016 Committee of the Whole of Council meeting a staff report (attached) was brought forward to explain the latest update to the Town s Provincial Park Assessment Appeal, with the assistance of MTE Paralegal Services. At the meeting staff were requested to bring forward a cost estimate to continue to proceed with the appeal process should the Town decide to not agree to the latest negotiated minutes of settlement. As described in the attached report, should the Town decide to agree with the minutes of settlement the net impact to taxation compared to 2012 would be a decrease by approximately $30k per year instead of the approximately $60k per year the Town has been experiencing over the last several years. DISCUSSION Attached you will find a quote received from MTE to continue the appeals process, with the first step being having the matter heard at the ARB (Assessment Review Board) at a cost of $100,000. This quote only covers this first step and does not include any costs associated with the appeal continuing beyond that, since it is very difficult for the consultants to predict what may happen after the ARB. Please note discussions would also occur with the County to see if a cost-sharing agreement could be entered into since the County also benefits if the final appeal is in the Town s favour. (County 1/3: Town 2/3 - to reflect taxation benefit split). CONCLUSION The appeal on the Provincial Park Property assessment has extended over the last four (4) years. From discussions with MTE it is expected that should the Town decide to continue the appeal it is anticipated to go to the highest courts which can be a very expensive and lengthy process. Therefore it is recommended that the Town agree to the minutes of settlement proposed as presented. Respectfully Submitted, Monica Quinlan, Treasurer (Encls) Form: WB-SR2010

2 2 From: Dave Powell Sent: 2016/October/14 1:11 PM To: Monica Quinlan Subject: Wassaga Beach estimates for MNR appeal continuing to the ARB Without Prejudice WASAGA BEACH APPEAL COSTS ARB HEARING ONLY days TCC with the ARB to set hearing dates and other procedures 1/2 Retain a lawyer and fill him in what we know today 1 Research for discoveries, questions to lawyer for discoveries 1 Discoveries 2 Further research from discoveries 2 Potential to go to Divisional court on a question being proposed (Prep) 2 May require some photographs of properties 1/2 Further research as data filters in 3 Prepare reports for hearing 2 Update lawyer, 2 Go over hearing details and presentation 1 Hearing 5 Approximate ½ days x various consultants times = approximately $40,000+ Lawyers fees 15 $500/ hr = $60,000 Therefore, for the ARB we would recommend that Council set aside $100,000. This appeal deals with two other government departments so don t know how far they would go or even if they might go for a settlement once we are underway should we go the hearing route. All this is a guesstimate since no one can predict the times that may be required. If we can come in lower we would certainly work towards that. I hope this helps explain why it is so difficult to predict costs for an appeal since we enter the unknown as appeals have a life of their own. Regards. David Powell BA, AACI, P.App, MIMA, CEI, PLE. Senior Consultant / Licensed Paralegal MTE Paralegal Professional Corporation. Tel: Ext. 406 Toll Free: Ext. 406 Fax:

3 STAFF REPORT TO: FROM: SUBJECT: Committee of the Whole Monica Quinlan, Treasurer Provincial Parks Property Assessment DATE: October 4 th, 2016 RECOMMENDATION THAT Committee of the Whole recommends to Council that it authorize the Treasurer to move forward with the proposed minutes of settlement regarding the Provincial Parks Property Assessment. BACKGROUND In the latter part of 2012 Municipal Property Assessment Corporation (MPAC) came forward with a new approach to valuing Provincial Park properties that reside in all municipalities across Ontario. While some Provincial Parks increased in value the Town of Wasaga Beach property value decreased by just over $28 Million causing a decreased taxation amount of approximately $60,000 (municipal portion only) per year beginning in The presentation from MPAC is attached hereto and has been the basis of the Town s appeals lead by Municipal Tax Equity Consultants (MTE) since that time. MTE are the property assessment experts that the County employs to protect assessed values within Simcoe County. The appeal was filed based on several points with the main argument being that of the original sixty (60) properties there were ten (10) properties included in the reduced assessment which were individually serviced lots that were not used as part of the Provincial Park and they should therefore drive higher values. DISCUSSION While staff have provided updates to members of Council over the past several years recently a mediation was held between the Ministry of Natural Resources and Forestry (MNRF), MPAC and MTE to review and discuss the appeals. The results of this mediation are that the values would increase for the years 2013 through to 2016 by $1,838,900 which results in an increase in the Municipal Portion of Taxation of approximately $11,000 per year. In addition to this, the 2016 CVA is proposed to increase by an additional $2,474,000 which provides an additional $15,547 per year (based on 2016 tax rates). The total of all the changes noted above would result in an increase of just over $27,000 or approximately half of the initial overall loss. The information is detailed below and in the attached report from MTE, while Appendix A depicts the value changes from 2012 to You will note that the increase in values also impacts the County and discussions will also take place with the Director of Finance at the County to ensure he is in agreement. Form: WB-SR2010

4 Cumulative Current County Tax 163, , , , ,864 Current Municipal Tax 258, , , , ,798 Current O.P.P Levy Tax ,664 57, ,156 Current 1% Capital Levy Tax - - 2,613 2,572 5,184 Current Total Tax $ 421,195 $ 423,500 $ 423,951 $ 427,358 $ 1,696,002 Revised County Tax 170, , , , ,688 Revised Municipal Tax 269, , , , ,872 Revised O.P.P Levy Tax ,238 59, ,211 Revised 1% Capital Levy Tax - - 2,725 2,683 5,408 Revised Total Tax $ 439,369 $ 441,773 $ 442,241 $ 445,796 $ 1,769,179 County Tax Change $ 7,035 $ 7,000 $ 6,906 $ 6,883 $ 27,824 Municipal Tax Change $ 11,139 $ 11,273 $ 8,698 $ 8,964 $ 40,074 O.P.P Levy Tax Change $ - $ - $ 2,574 $ 2,480 $ 5,055 1% Capital Levy Tax Change $ - $ - $ 112 $ 111 $ 224 Total Tax Change $ 18,174 $ 18,273 $ 18,290 $ 18,438 $ 73,177 CONCLUSION The appeal on the Provincial Park Property assessment has extended over the last four (4) years. From discussions with MTE it is expected that should the Town decide to continue the appeal it is anticipated to go to the highest courts which can be a very expensive and lengthy process. Therefore it is recommended that the Town agree to the minutes of settlement proposed as presented. Respectfully Submitted, Monica Quinlan, Treasurer

5 CONFIDENTIAL HYPOTHETICAL TAX IMPACT SUMMARY 555 BLUEBERRY TRAIL Prepared For: SIMCOE COUNTY (TOWN OF WASAGA BEACH) By: MUNICIPAL TAX EQUITY (MTE) CONSULTANTS INC. GEORGETOWN, ONTARIO Published On: MONDAY SEPTEMBER 19 TH, Municipal Tax Equity (MTE) Consultants Inc.

6 CONFIDENTIAL DISCLAIMER AND CAUTION The information, views, data and discussions in this document and related material are provided for general reference purposes only. Regulatory and statutory references are, in many instances, not directly quoted excerpts and the reader should refer to the relevant provisions of the legislation and regulations for complete information. The discussion and commentary contained in this report do not constitute legal advice or the provision of legal services as defined by the Law Society Act, any other Act, or Regulation. If legal advice is required or if legal rights are, or may be an issue, the reader must obtain an independent legal opinion. Decisions should not be made in the sole consideration of or reliance on the information and discussions contained in this report. It is the responsibility of each individual in either of a decision-making or advisory capacity to acquire all relevant and pertinent information required to make an informed and appropriate decision with regards to any matter under consideration concerning municipal finance issues. MTE is not responsible to the municipality, nor to any other party for damages arising based on incorrect data or due to the misuse of the information contained in this study, including without limitation, any related, indirect, special or consequential damages Municipal Tax Equity (MTE) Consultants Inc.

7 CONFIDENTIAL HYPOTHETICAL TAX IMPACT SUMMARY The following tax impact summary has been prepared to illustrate the effect of revised assessment values that have been indicated in respect of the subject property for taxation years 2013 to This summary must be considered preliminary and speculative in nature and must only be relied upon for general information purposes as documentation in respect of the assessment changes for 2013 to 2016 taxation years have not yet been prepared or published. Hypothetical Assessment Change Summary Current CG 42,620,000 42,620,000 42,620,000 42,620,000 Revised CG 44,458,900 44,458,900 44,458,900 44,458,900 Property Total Change $ 1,838,900 1,838,900 1,838,900 1,838,900 Property Total Change % 4.31% 4.31% 4.31% 4.31% Hypothetical CVA Tax Change Summary Cumulative Current County Tax $163,034 $162,227 $160,071 $159,532 $644,864 Current Municipal Tax $258,161 $261,273 $201,603 $207,761 $928,798 Current O.P.P Levy Tax $0 $0 $59,664 $57,493 $117,156 Current 1% Capital Levy Tax $0 $0 $2,613 $2,572 $5,184 Current Total Tax $421,195 $423,500 $423,950 $427,357 $1,696,003 Revised County Tax $170,069 $169,227 $166,977 $166,415 $672,688 Revised Municipal Tax $269,300 $272,546 $210,301 $216,725 $968,872 Revised O.P.P Levy Tax $0 $0 $62,238 $59,973 $122,211 Revised 1% Capital Levy Tax $0 $0 $2,725 $2,683 $5,408 Revised Total Tax $439,368 $441,773 $442,242 $445,796 $1,769,179 County Tax Change $7,034 $7,000 $6,906 $6,883 $27,824 Municipal Tax Change $11,139 $11,273 $8,698 $8,964 $40,074 O.P.P Levy Tax Change $0 $0 $2,574 $2,481 $5,055 1% Capital Levy Tax Change $0 $0 $113 $111 $224 Total Tax Change $18,173 $18,273 $18,292 $18,439 $73, Municipal Tax Equity (MTE) Consultants Inc.

8 Wasaga Beach Provincial Park Current Value Assessment November 2012

9 Provincial Parks Review MPAC conducted a thorough review of Provincial Park valuations across Ontario in response to Requests for Reconsideration and Assessment Review Board appeals filed on 19 Provincial Parks Analysis identified inconsistencies in the historical valuations 2

10 Provincial Parks Review 3 Ministry of Natural Resources (MNR), as the authority for Ontarios Provincial Parks provided the following data: Regulated park acreages and boundaries Development Zones (e.g., campground) Non-Development Zones (e.g., parkland) Current capitalized costs for buildings Provincial Parks analysis for 2012 Assessment Update included MNR data (above) and MPACs sales analysis for: Bulk residential land Vacant waterfront land Vacant commercial land

11 Park Valuations - Historical View Provincial park properties have been valued on the principal of highest and best use, similar to neighbouring properties Regulated park boundaries have changed over time Multiple roll numbers within park boundaries and parks that span municipal boundaries resulted in various methodologies being applied to determine the park valuations 4

Wasaga Beach Provincial Park 5 Wasaga Beach Provincial Park Plan comprises 60 parcels of land Parcels are not all contiguous Regulatory change must occur before an individual parcel could be

12 Wasaga Beach Provincial Park 5 Wasaga Beach Provincial Park Plan comprises 60 parcels of land Parcels are not all contiguous Regulatory change must occur before an individual parcel could be sold Historically, each parcel was valued as an individual parcel that could be sold on the open market Resulting current value assessment was higher than if the park was valued as one parcel

13 Wasaga Beach Provincial Park 2012 Current Value Assessment 6 Park Class Recreation Regulated Park Area 4,557 acres Development Zone 33.5% (includes main street/waterfront area and some parkland) Non-Development Zone 66.5% (includes parkland only)

14 Wasaga Beach Provincial Park 2012 Current Value Assessment Details Development Zone Value 1 $ 6,256,600 Non-Development Zone Value 2 $ 3,369,000 Waterfront Value 3 $38,502,400 Capitalized Building Value(s) 4 $ 3,743, Current Value Assessment $51,871,000 1) Development zone value is calculated using the median ratio difference between 1 acre of bulk residential land to 1 acre of commercial vacant land by assessment region (1,526 acres x $4,100 = $6,256,600) 2) Non-development zone value is calculated using bulk residential land rates by assessment region (3,031 acres x $1,111 = $3,369,000) 3) Waterfront value is a premium calculated using the median ratio difference between the 1 acre of vacant residential waterfront to 1 acre of inland residential vacant land by assessment region and applying the difference (400%) to the rates per acre to the total park acreage 4) Capitalized Building Value(s) provided by the Ministry of Natural Resources and are based on the same principles that MPAC applies for all buildings (e.g., replacement cost new less depreciation) 7

15 French River Provincial Park 181,693 51,782, Wasaga Beach Provincial Park 4,557 51,871,700 11,382 Sandbanks Provincial Park 3,832 36,506,116 9,526 Pinery Provincial Park 6,257 30,687,000 4,905 8 Comparable Parks Provincial Park Acreage 2012 CVA Value Per Acre Massasauga Provincial Park 32,382 63,691,000 1,967

18 acres - 2012 CVA $405,000 9 Ministry of

16 Provincial Properties Outside the Regulated Park Boundary Ministry of Natural Resources 0.18 acres CVA $405,000 9 Ministry of Natural Resources 0.59 acres CVA $479,000

17 Municipality 2008 CVA 2012 CVA Difference North 210,787, ,343,500 39,556,200 Northeast 417,433, ,786,600-27,647,000 Southwest 164,363, ,212,700 1,848,800 Southcentral 16,029,300 30,708,600 14,679,300 East 50,655,900 65,639,900 14,984,000 GTA West 68,839, ,309,000 65,470,000 Toronto/Durham 1,985,000 3,379,000 1,394,000 Grand Total 930,094,000 1,040,379, ,285, Provincial Summary 2012 Valuation Changes

18 11 Thank you Questions?

19 Appendix 'A' - Wasaga Beach Provincial Park New Valuation Approach and Class Changes 2008 CVA ANALYSIS 2012 CVA ANALYSIS TAXATION ANALYSIS Roll Number Owner Prop Code Parcel Acreage RTC RTQ 1 CVA_ CVA Total 2012 CVA Market Difference RG Value CG Value 2012 PILS TOTAL 2015 PILS TOTAL 2012 PILS Municipal 2015 PILS Municipal MNR RG 124, ,000 39,543 (84,457) 13,102 26, MNR RG 492, ,000 8,121 (483,879) 2,691 5,430 3, , MNR RG 944, , ,961 (220,039) 239, ,085 7, , MNR RG 831, ,000 14,652 (816,348) 4,855 9,797 6, , MNR RG 1,104,000 1,104,000 24,362 (1,079,638) 8,072 16,290 8, , MNR RG 685, ,000 9,709 (675,291) 3,217 6,492 5, , MNR RG 685, ,000 9,709 (675,291) 3,217 6,492 5, , MNR RG 115, ,000 16,064 (98,936) 5,323 10, MNR RG 3,541,000 3,541, ,332 (3,099,668) 146, ,102 25, , MNR RG 271, ,000 4,766 (266,234) 1,579 3,187 1, , MNR RG 3,243,000 3,243, ,796 (2,987,204) 84, ,041 23, , MNR RG 192, ,000 29,128 (162,872) 9,651 19,477 1, MNR RG 134, ,000 10,945 (123,055) 3,627 7, MNR RG 3,279,000 3,279,000 32,482 (3,246,518) 10,763 21,719 25, , MNR RG 1,109,000 1,109,000 16,594 (1,092,406) 5,498 11,096 8, , MNR RG 1,253,000 1,253,000 28,069 (1,224,931) 9,300 18,768 9, , MNR RG 858, ,000 12,887 (845,113) 4,270 8,617 6, , MNR RG 1,608,000 1,608,000 67,965 (1,540,035) 22,520 45,446 11, , MNR RG 2,844,000 2,844, ,120 (2,504,880) 112, ,756 22, , MNR RG 194, ,000 29,304 (164,696) 9,710 19,595 1, MNR RG 50,000 50, (49,823) MNR RG 71,000 71,000 1,059 (69,941) MNR RG 13,778,000 13,778, ,646 (12,946,354) 275, , , , MNR RG 22,158,000 22,332,472 2,241,967 (20,090,505) 742,851 1,499, , , MIO RG 1,613,000 2,009,000 4,980,697 2,971,697 1,650,299 3,330,398 11, , , , MNR RG 309, , ,952 53, , ,691 2, , MNR RG 171, ,000 21,890 (149,110) 7,253 14,637 1, MIO RG 188, ,000 66,906 (121,094) 22,169 44,737 1, MNR 107 1, RG 3,321,000 3,322,768 33,161,692 29,838,924 10,987,764 22,173,928 24, , , , MNR RG 715, ,000 25,597 (689,403) 8,481 17,116 5, , MNR RG 455, ,000 3,531 (451,469) 1,170 2,361 3, , MNR RG 349, ,000 1,004, , , ,769 2, , MNR RG 347, ,000 1,783,511 1,436, ,947 1,192,564 2, , MIO RG 343, ,000 1,759,856 1,416, ,109 1,176,747 2, , Page 1 of 2

20 Appendix 'A' - Wasaga Beach Provincial Park New Valuation Approach and Class Changes 2008 CVA ANALYSIS 2012 CVA ANALYSIS TAXATION ANALYSIS Roll Number Owner Prop Code Parcel Acreage RTC RTQ 1 CVA_ CVA Total 2012 CVA Market Difference RG Value CG Value 2012 PILS TOTAL 2015 PILS TOTAL 2012 PILS Municipal MNR RG 99,000 99, ,596 90,596 62, , MIO RG 473, ,000 2,429,445 1,956, ,970 1,624,475 3, , MNR CG 1,015,000 1,015,000 20,301 (994,699) 6,727 13,575 9, , MNR RG 433, ,000 3,178 (429,822) 1,053 2,125 3, , MNR RG 613, ,000 6,355 (606,645) 2,106 4,249 4, , MNR RG 445, ,000 3,531 (441,469) 1,170 2,361 3, , MNR RG 856, ,000 14,476 (841,524) 4,796 9,679 6, , MNR RG 132, ,000 15,358 (116,642) 5,089 10, MNR RG 113, ,000 4,060 (108,940) 1,345 2, MNR RG 117, ,000 5,826 (111,174) 1,930 3, MNR RG 102, ,000 2,825 (99,175) 936 1, MNR RG 102, ,000 2,825 (99,175) 936 1, MNR RG 114, ,000 6,002 (107,998) 1,989 4, MNR RG 116, ,000 6,532 (109,468) 2,164 4, MNR RG 102, ,000 2,648 (99,352) 877 1, MNR RG 975, , ,299 (292,701) 226, ,227 7, , MNR RG 94,000 94,000 5,826 (88,174) 1,930 3, MNR RG 110, ,000 24,715 (85,285) 8,189 16, MNR RG 1,759,000 1,759,000 7,061 (1,751,939) 2,340 4,722 12, , MNR RG 487, ,000 3,178 (483,822) 1,053 2,125 3, , MNR RG 615, ,000 6,532 (608,468) 2,164 4,367 4, , MNR RG 855, ,000 13,063 (841,937) 4,328 8,735 6, , MNR RG 744, ,000 12,004 (731,996) 3,977 8,027 5, , MNR RG 974, ,000 16,241 (957,759) 5,381 10,860 7, , MNR RG 494, ,000 22,773 (471,227) 7,545 15,227 3, , MNR RG 233, ,000 4,413 (228,587) 1,462 2,951 1, , PILS Municipal 2, $ 80,118,240 $ 51,871,700 $ (28,246,540) $ 17,187,062 $ 34,684,639 $ 588,049 $ 515,813 $ 381,314 $ 321,057 $ 72,236 Difference $ (60,257) Page 2 of 2

To establish a policy that guides City assessment review activities to help ensure stability and accuracy of the assessment base.

EFFECTIVE: June 1, 2007 REPLACES: new PAGE: 1 of 13 POLICY STATEMENT: To establish a policy that guides City assessment review activities to help ensure stability and accuracy of the assessment base. PURPOSE: