b'TAX ASSESSMENTSSUITABLE APPROACH reserves in their valuation of the property.understanding of aggregate properties or To date, this type of methodology has beenSofindingsalesofcomparablepropertiesthe sector in general. What the province missing. Part of the problem is that aggregateexcluding this component of the sales priceisfacingasaresultisthepossibilityof propertiescannotbeassessedinthesameis virtuallyimpossible.afinancialdisastercostingmillionsof mannerasotherpropertiesusingMPACsdollarsonappeals,increasedaggregate current value assessment method (CVA). ThisAlso, industry stakeholders say the MPACcosts for priority projects like housing and commonly used method involves comparingprocessisnotconsistentwithdecisionsinfrastructure, a dip in foreign investment, properties with similar classifications in thereachedbytheprovincesAssessment sameregionwhentheyaresold.FindingReview Board (ARB), which hears propertyand the possible loss of small aggregate salesofotheraggregatepropertiesintheassessment appeals. In particular, the Boardproducers. There is a lot at stake.same area as the aggregate property beinghad clearly stated that assessment values of assessed is clearly prettydifficult. aggregatesitesshouldbecomparedwithToavoidthisconcerningscenario, like or similar properties.OSSGAwantstheprovincetoputin Earlier attempts by OSSGA and MPAC toplaceregulationsthatwouldensure settle on a more workable assessment methodAnotherconcernisthespeedwithaggregatepropertiesaretaxedinafair consistently came up against challenges. AswhichMPACmovedforwardwithitsand responsible manner. We propose that the then OSSGA executive director wrote in2024reassessments,bypassinganindustrythe2024valuationratesbeconsistent his November letter to the Finance Ministry:questionnaire that was sent out to aggregatewiththeearlier2016valuationrateand Appeals and reassessments have been goingoperatorsinpastyearstodeterminelandthat inconsistencies in aggregate property on for decadeswith assessments and theclassifications.Instead,MPACutilized resultingtaxesswinginglikeapendulumdroneimagesofsitesandarbitrarylandclassification be resolved. (The MPAC 2024 back and forth to one partys advantage orclassifications.(MPAChasnowagreedrates result in most aggregate sites being the other. tore-introducethequestionnairesconverted from a lower tax class for large movingforward.) site areas to the industrial tax class.)AfterarecentWellingtonCounty aggregate assessment appeal case upheld aWEAK UNDERSTANDINGOSSGAs Board of Directors Executive decision to establish a county per acre valueOSSGA holds the general view that MPACmet with Ministry of Finance officials and rate for pits and quarries, MPAC applied asimplydoesnotunderstandtheaggregatewrote to Minister Bethlenfalvy to express similarmethodologyacrossallaggregateindustry and that it needs to take concreteourconcernandtocallforapauseon sites in the province. It reassessed the sitessteps to learn more about it if it is to everthe use of the recent valuation numbers based on local sales of all classifications ofconductaccuratevaluations.Thisviewinthenextroundoftaxation.Inearly properties between five and 250 acres withinissharedbytheindustrysaggregateJanuary,OSSGAreceivedaletterback akilometreoftheaggregateoperation,suppliers,largeandsmall.ManyofthefromtheMinisterindicatingthat,the usingthisapproachtodeterminemediancourtappealstakenforwardbyaggregategovernment is undertaking a review of the assessment rates for each county.producers [reveal] that MPAC really does not understand how to assess these properties,property assessment and taxation system The result for the aggregate industry wasconfirms Glenn Lucas, principal of Propertythatwillfocusonfairness,affordability, catastrophic,withvaluationsskyrocketingTax Review Services.and business competitiveness.The review byasmuchas1,000percentforsomewillalsoincludeexploringmodernized operators.Steppingback,MPACthenWhat would help, adds Lucas, is to haveadministrationtools.Aspartofthe increasedtheminimumsizerequirementmunicipalities more involved in the appealworkonthisreview,theassessment oflocalpropertiesto25acresfromfive.process, but this too has been missing to date.andclassificationofgravelpitswill Still, some operations saw their assessmentsUntilthemostrecentWellingtonappeal,beexplored.double or triple. They were dismayed by themunicipalitieshavefailedtoparticipatein fact that the assessments failed to take intoany meaningful way in past appeals, he says.This is good news, and we look forward consideration the unique nature of their siteto working with the Ministry and MPAC in relation to other properties in the region.Regan Cox, president of Cox Construction, expresses similar concern over MPACs lack ofon a new methodology. That said, we still The historic challenge facing the industryindustry insight. Combining large and smallneed to ensure that the recent valuation fortaxassessmentistheuniqueaspectaggregatesitesintoonesingletaxbracket,assessments are not used as the basis for inherentwithaggregateproperties,saysfor instance, is yet another misguided MPACthe next round of tax invoices. OSSGA JamesBellaire,executivevicepresident,decision with grave consequences, especiallyis asking members to file a Request for finance, and chief financial officer at Walkerforsmalloperators.MPACsapproachtoReconsideration(RFR)withMPACfor Aggregates.Forexample,oftenonlycategorize large and small pits and quarries ineachpropertythatwasreassessedas certainpartsofourpropertiesarebeingone tax bracket is simply unfair. They shouldsoon as possible. The deadline is March minedforaggregateatanyspecifictime,be differentiated based on size by using annual31, 2024. Our continued work with the whileotherareascouldberehabilitatedsales or licensing quota, suggestsCox. Ministry,andastrongresponsefrom and/or farmed. The challenge in valuating aggregate properties for MPAC is that underWiththenumberofconcernsbeingmembers,willensurethelong-awaited the regulations, no value can be attributedraised,manyindustryprofessionalsfeelitfair property assessments the industry has totheunminedin-groundaggregateall comes down to MPACs lack of any truebeen seeking.WINTER 2024AVENUES 15'