T29 - Property Taxes: How to Manage and Minimize HOW ALMA BLACKWELL - PowerPoint PPT Presentation

T29 - Property Taxes: How to Manage and Minimize

HOW ALMA BLACKWELL CAME TO PAY NO PROPERTY TAXES  I was sitting at my desk one day in 2004 , reading the Infolink …

…when, after I finished reading the article, a light bulb came on!

The article was about a non profit charity in Ottawa that provides housing & support services to folks with mental illnesses & how they had to fight to continue to have their building be exempt from paying property taxes. How did they get to be tax exempt in the first place, I wondered?

Their buildings had been exempt from property taxes for several years, until a 1997 amendment to the Ontario legislation came into effect. That amendment exempted land & buildings from property taxation for land if it was: ‘…owned, used and occupied by …any charitable, non-profit philanthropic corporation organized for the relief of the poor if the corporation is supported in part by public funds.’

This new amendment meant the society was supposed to have exclusive occupancy of the residential units in order for them to continue to be exempt from paying property taxes, but, of course, the suites were tenanted. However, under this revised legislation the assessors revoked the charity’s previous exemption from paying property taxes! Wha?????

After several appeals the society won its case because the judge found: ‘The fact of physical occupation by each tenant of a given rental unit does not detract from the fact that the land as an entirety is ‘occupied by’ (the charity) in the carrying on of its charitable business or activity.’

The judgement referred to a 1974 case in BC involving Coast Foundation that had the same issue as the Ontario charity. The Vancouver Charter, still contains in section 396(c) the provision interpreted by the BC courts in 1974 in the Coast case, exempting land ‘ of which an incorporated charitable institution is the registered owner or owner under agreement, either directly or through trustees therefore, and which is in actual occupation by such institution and is wholly in use for charitable purposes.’

After reading that article, I had a conversation with our representative at Deloitte Touche (now Altus Group) who look after our property tax assessment appeals.

I asked if we could look into a property tax exemption for our property, Alma Blackwell, which our society owned (so was not a leased property). I was warned this would be a test case through the BC courts and it could be costly!

Deloitte Touche agreed to take on the case & so began a 6 year process, from the date of reading that Infolink article! As DT also represented Red Door Housing Society with their property tax assessment appeals, we invited them to join us in this appeal for their owned (not leased) building, Mi Casa.

In 2006 both properties appealed to have their property taxes exempted. In 2007 , the Property Assessment Appeal Board ruled the properties met the criteria and ordered the Assessor to fully exempt the buildings.

However, in 2008 BC Assessment & the City of Vancouver jointly filed an appeal to the Supreme Court of BC asking them to overturn the Property Assessment Appeal Board’s decision.

In March 2009 , the Supreme Court of BC issued their decision which upheld the decision of the Property Assessment Appeal Board. YAY!

Yet despite the 2 tribunal decisions supporting this application, the City of Vancouver continued to vigorously appeal! In June 2009 , the city sought leave to appeal to the Court of Appeal & was granted leave to appeal in a decision dated July 29/09. BC Assessment was not a party to this appeal.

In August 2009 , the Executive Directors of both ENF and RDHS co-signed a letter to the City of Vancouver’s Mayor & Councillors requesting they drop the appeal. In December 2009 , the mayor finally answered and disappointingly said ‘ no ’.

Finally, on May 25, 2010, after many years and thousands of dollars in legal fees, the final judgement to the City’s appeal was released. The decision was summed up as follows: “…occupation of the units by tenants in fulfillment of the societies’ charitable purposes amounts to ‘actual occupation’ of the properties by the housing societies”.

If your society would like to appeal for an exemption to property taxes, you can call: Phil Gertsman at Altus Group Limited Direct: 778-329-9293 #630, 1040 W. Georgia Street, Vancouver, BC V6E 4H1 phil.gertsman@altusgroup.com