WHEREAS on May 31, 2016 the Government of Alberta tabled before the Legislature of the Province of Alberta Bill 21: Modernized Municipal Government Act; and
WHEREAS the Modernized Municipal Government Act creates a Centralized Industrial Property Authority under the newly created position of Provincial Assessor; and
WHEREAS the Modernized Municipal Government Act indicates that the Provincial Assessor will be responsible for the assessment of ‘designated industrial property’ as yet to be defined in the regulations; and
WHEREAS the 2018 property taxation will be based on the 2017 property assessment which begins January 1, 2017 – in just 100 days; and
WHEREAS neither the Modernized Municipal Government Act nor any regulations pertaining to the Act have been proclaimed into law with respect to the Centralized Industrial Property Authority or the Provincial Assessor and no clear process has been established to transition the authority currently held by Alberta municipalities to the province; and
WHEREAS numerous procedural, policy and legal questions arise from the proposed legislation that remain unanswered by the Government of Alberta;
THEREFORE, BE IT RESOLVED that the Alberta Association of Municipal Districts and Counties call upon the Government of Alberta to delay or repeal the establishment of the Centralized Industrial Property Authority and the creation of the Provincial Assessor until such time as the appropriate studies, pilot projects, and consultation with all effected property owners has been completed and analyzed so the effectiveness of such a policy may be fully understood;
FURTHER BE IT RESOLVED that the Alberta Association of Municipal Districts and Counties call upon the Government of Alberta to consult with the Alberta Association of Municipal Districts and Counties and the Alberta Assessors Association in order to answer the numerous procedural, policy and legal questions which arise from the decision to create the Centralized Industrial Property Authority under the newly created position of Provincial Assessor.
Creation of DIP and Provincial Assessor
“The MMGA amendments create a new property type: “designated industrial property” and a “provincial assessor”. How does removing responsibility for more than half of a municipality’s assessment base demonstrate the “importance of working together with Alberta’s municipalities in the spirit of partnership the newly inserted Preamble states? Current rates utilized for regulated properties do not appear to be well researched and supported. It has been stated there will be no policy changes in regard to regulated properties. If this is in fact the case how does changing the service delivery model to one that is less transparent and less accountable improve fairness and equity in the assessment process?”
Currently, a municipal council is responsible to prepare assessments for all property except Linear and non?assessable property, this includes machinery & equipment, railway, other non?residential property not defined as Linear. Properties can be split into two groups: non?regulated properties – assessed on a market value standard and regulated properties – assessed using rates provided by Alberta Municipal Affairs. Assessments are required to be fair and equitable among similar properties (MGA s.293). Non?regulated properties are based on local market data and subject to the Quality Standards outlined in the Regulation and oversight by the Province via Assessment Audit. Regulated property assessments prepared by the municipal assessor utilizing the procedures prescribed in the MGA and Regulation and are subject to oversight by the Province via Assessment Audit. Assessed persons have the right of complaint for all property types.
The Preamble the Province has added to the MMGA states: “WHEREAS Alberta’s municipalities, governed by democratically elected officials, are established by the Province, and are empowered to provide responsible and accountable local governance… … WHEREAS the Government of Alberta recognizes the importance of working together with Alberta’s municipalities in a spirit of partnership to co?operatively and collaboratively advance the interests of Albertans generally…”
A municipal Council may not prepare an assessment for properties defined as “Designated Industrial Property” nor does it have the ability to request information to know how a DIP assessment was prepared (or a summary of a neighboring municipalities DIP assessment) to ensure fairness and equity. Market value assessments are subject to oversight by both the municipality and the province. There are no known quality control mechanisms other than the right of complaint by an assessed person to ensure accuracy, fairness and equity for DIP properties at this time. The creation of Designated Industrial Property may have the effect of creating two standards of assessment for the same or similar property (i.e. veggie processing plants)
To ensure transparency and accountability, it may be much more cost effective and efficient for the Ministry to dismiss the concept of “designated industrial property” and fulfill the existing mandate of supporting property assessment by providing modernizing and maintaining regulated rates/manuals, training for municipal officials, assessors, and industry representatives in conjunction with other stakeholders, and an adequate oversight and advisory component to ensure quality control. The MD of Taber supports the Alberta Assessors’ Association report and recommendation on the topic of Centralized Industrial Assessment submitted to the Stake Holder Advisory Committee earlier this year.
Letter sent to Minister Larivee September 13, 2016
September 13, 2016
Honourable Danielle Larivee, Minister of Municipal Affairs
Alberta Municipal Affairs Legislature Office
Room 204, Legislature Building
10080 – 97 Avenue NW
Edmonton, AB T5K 2B6 via email: email@example.com
RE: Implementation of the Centralized Industrial Property Assessment for the 2018 Tax Year (2017 Assessment Year)
Dear Minister Larivee,
As you are aware Bill 21 – The Modernized Municipal Government Act creates a Centralized Industrial Property Assessment Authority under the newly created position of Provincial Assessor. Effective for the 2018 property tax year the Provincial Assessor will be responsible for the assessment of ‘designated industrial property’ as yet to be defined in Regulation. 2018 property taxation will be based on the 2017 property assessment – the 2017 assessment year begins January 1, 2017 – in just over 100 days. The Municipal District of Taber remains opposed to this change in Provincial policy and the removal of this portion of property assessment from the responsibility of the municipal assessor for reasons previously submitted in our letter dated April 15, 2016.
However, we would be remiss in our duties to our citizens if we did not consider the effect Centralized Industrial Property Assessment will have on resourcing, staffing levels, and the subsequent changes in our budgetary planning process which is rapidly approaching (beginning in October) for 2017. To this end, we would appreciate your timely assistance in answering several of the following questions so we may be accurately informed prior to our decision making and budget processes.
As you can see the significance of this policy shift creates a marked impact on the predictability and stability of our primary revenue stream as well as the annual budgeting and forecasting processes a prudent municipality must complete to carry on sustainable operations. Until the action plan Municipal Affairs intends to implement is revealed to municipalities the impact of ‘designated industrial property’ assessment will continue to impose difficulties and uncertainties and threaten local autonomy and accountability.
We continue to believe the issues currently surrounding property assessment, and more specifically industrial property assessment, could be better resolved by Municipal Affairs fulfilling a mandate it’s had for more than 20 years to provide:
As such, it remains our opinion the creation of a centralized industrial property assessment authority under a Provincial assessor puts further strain on a department already appearing to struggle to fulfill its mandate.
In summary, we look forward to your timely response to the questions posed so we may be better informed of the Ministry’s intentions and planned actions regarding ‘designated industrial property’ so we may prudently complete our 2017 operating budget. We continue to believe the modifications presented in Bill 21 for the purpose of centralizing industrial property assessment represent a fundamental encroachment on municipal autonomy. We further believe this policy change to be based on the fallible beliefs of a limited few individuals rather than representing the opinions of the majority as offered and reinforced over the course of the Summer Tour. There is a high potential our level of service to our citizens may be threatened by these unknowns negatively impacting our municipal operations and sustainability.
Thank you for your consideration of our concerns on this matter. We greatly appreciate the opportunity to work in partnership with the Province where policy changes of such critical importance to our municipality are concerned.
Reeve, Municipal District of Taber
cc: Mr. Brad Pickering, Deputy Minister Municipal Affairs
cc: Ms. Meryl Whittaker, Acting Assistant Deputy Minister, Municipal Assessment & Grants Division
cc: Mr. Al Kemmere, President, AAMD&C
cc: AUMA president@AUMA.ca
cc: Foothills Little Bow Association
cc: Alberta Assessors’ Association firstname.lastname@example.org
RMA has no active resolutions directly related to this issue.
Municipal Affairs: The Modernized Municipal Government Act (MMGA) received first reading on May 31, 2016, and was introduced to provide Albertans the opportunity to review the changes, ask questions, and provide their feedback on our proposed amendments.
To ensure that Albertans had their chance to provide feedback, Alberta Municipal Affairs (MA) held 21 engagement sessions in 20 locations across the province. Municipal and industry stakeholders have indicated the complex nature of industrial sites creates provincewide challenges in consistently applying definitions, determining who assesses which portions of the property, and identifying the appropriate appeal body. During focused consultations for the Municipal Government Act in 2014, municipal and industry stakeholders agreed that assessment of property on designated industrial sites should be prepared by a central body.
Under the MMGA, designated industrial property (DIP) will be defined as major plants, properties regulated by provincial and federal regulators, linear property, and rail property. The assessment of all DIP will be centralized within MA, which has resulted in municipalities requesting further information about the transition of responsibility for DIP assessments. It is understood that these requests will become increasingly urgent as municipalities face important decisions for the upcoming year on their internal assessment staff resources and contracting arrangements. MA staff will share as much information as possible about this process as soon as it becomes available.
Regarding the transition of responsibility for the assessment of DIP, MA staff will collaborate with municipalities and assessors with expertise in DIP property assessment to plan this transition. More information about this process will be shared as soon as possible.
The Government of Alberta response does not indicate a willingness to delay or repeal the process of transitioning to centralized assessment for designated industrial property. The response indicates that the Government of Alberta received sufficient feedback in favor of the move to centralized assessment during previous MGA consultation opportunities to warrant the decisions being final. RMA appreciates the Government of Alberta’s willingness to share as much information as possible with municipalities related to procedural changes, and to take into consideration municipal input on the draft list of industrial properties designated as “major plants,” but this does not address the intent of the resolution.
In an effort to support a successful transition to a centralized industrial property system, Alberta Municipal Affairs has implemented an interim hybrid model in which municipalities will be contracted to continue to assess industrial properties on behalf of the provincial assessor. While the RMA appreciates this approach, a preferred alternative may be to maintain this contractual arrangement permanently, as it allows municipal assessors to utilize their local knowledge with increased provincial oversight of the assessment process. In 2018, the province is requisitioning about $5.8 million in designated industrial (DI) property taxes from designated industrial property owners, through a separate tax rate applied to every DI property owner’s municipal tax notice.
RMA and several RMA members have been involved in the planning of the transition to centralized industrial property assessment with the intent to minimize the disturbance to municipalities and assessors. This resolution is assigned a status of Intent Not Met, and RMA will continue to advocate on this issue.