POLICY UPDATE: Protecting Homeowners PDF Print E-mail
Thursday, 08 March 2007 19:00

 
PROTECTING HOMEOWNERS

On March 9, 2007 Ontario PC Party Leader John Tory announced a plan to protect Ontario homeowners from runaway property assessment increases that put some people at risk of losing their homes.

Key Points:

  • Establishing a five per cent annual cap on property assessment increases for as long as an individual owns his or her home (including if a property is transferred to a spouse).
  • Implementing a new reverse onus appeal system so the Municipal Property Assessment Corporation (MPAC) will have to justify an assessment increase instead of placing the burden of proof on the homeowner.
  • Ensuring MPAC fully implements the recommendations of the Ombudsman, and if the serious problems identified by the Ombudsman have not been addressed, shutting down MPAC and building a better model.
  • Addressing rural assessment inequalities that currently penalize Ontario farmers -- the PC policy will ensure that farmers who are encouraged to have value-added production services are not subject to unfair property tax assessments.
Background

The Municipal Property Assessment Corporation (MPAC) was created in 1998 to conduct property assessment rolls, supplementary assessment lists and updates, send out property assessment notices to owners, conduct municipal enumerations and report on the population of each of Ontario’s municipalities.  

MPAC operates for about $25 million less than when property assessments were undertaken by the Ministry of Revenue, and is now funded by municipalities, not the province.

Currently provincial legislation sets a funding formula for MPAC that is based 50% on number of properties (a rough approximation of the cost of assessing) and 50% on value (ability to pay). The result of this policy is that many larger municipalities pay much more than the actual cost to assess them.  Many other municipalities essentially have their cost subsidized.

On March 28, 2006 the Ombudsman of Ontario released his “Investigation into the Transparency of the Property Assessment Process and the Integrity and Efficiency of Decision-Making at the Municipal Property Assessment Corporation, Getting it Right”.  The report contained 22 recommendations and all but two of those recommendations are the responsibility of MPAC.

In his report, the Ombudsman noted that property assessments have skyrocketed in recent years, the average assessed home in Ontario leapt from $179,151 in the 2003 taxation year to $232,