Aggregate News

 

Tax Implications of Aggregate Operations (2018)

 

 

In Ontario, the Municipal Property Assessment Corporation (MPAC) releases property values every four years.  Annual property taxes are calculated based on that value.

 

After the 2008 property valuations by MPAC, the Ontario Stone, Sand and Gravel Association (OSSGA) organized appeals to the Assessment Review Board (ARB) by roughly 500 aggregate site owners.  To appease these 2009 “legacy appeals”, MPAC established a new pit and quarry valuation method in 2016:

 

MPAC Market Valuation Report – Valuing Pits and Quarries in Ontario (1-Jan-2016) (.pdf)

 

MPAC Methodology Guide – Valuing Pits and Quarries in Ontario (1-Jan-2016) (.pdf)

 

In a nutshell, the new valuation method values the aggregate property excluding the aggregate.  MPAC equates such property to Class 5 farmland.

 

The previous assessment method valued active areas of aggregate operations at industrial land rates on a per-acre basis.  In the case of Wellington County, that valued most county pits between $40,000 and $50,000 per acre depending on the size of the active area.  Other areas of the site were taxed based on the use of the land (farm or residential).

 

Under the new assessment, producers do not pay property tax on the aggregate.  The new method of assessment values active areas of aggregate operations at class 5 farmland rates plus “site preparation costs” to a maximum of $15,000 per acre province-wide.  (source) (source)

 

The Assessment Review Board promoted the selection of ten test cases from across the province to determine the assessment methodology for all gravel pit properties under appeal. MPAC started by re-assessing the “trial” aggregate properties for the 2009 to 2012 tax years, and in some cases 2006 to 2012.

 

Upon realizing the impact of the new valuation on revenue, municipalities appealed the new valuation method to the ARB. Around November 2015 the Top Aggregate Producing Municipalities of Ontario (TAPMO) gave warning of tax assessment appeals by a number of Ontario gravel pit owners.  (source)

 

To date, Wellington County and the municipalities of Erin, Puslinch and Guelph/Eramosa continue to warn of the problem and offically appeal the decision asking for a “fair and equitable assessment system”. 

 

A reduction in property assessment is a revenue loss for the municipality and the province, which ultimately must be borne by all other taxpayers.

 

 

NEWS – Tax Implications of Aggregate Operations

 

Date

yyyy-mm-dd

Posted By

Article Link

Comment

2018-05-07

Clearview Township

Memo: TAPMO members ** Action requested ** re MPAC Appeal by Wellington County

Dennis Lever

Chair, Top Aggregate Producing Municipalities of Ontario (TAPMO)

2017-05-31

CaledonEnterprise.com

Aggregate appeals to cost Caledon taxpayers $6 million

Matthew Strader

2017-05-12

Theifp.ca

Settlement to cost Ontario’s municipal taxpayers millions as gravel pits get huge tax break

Graeme Fisque

2017-04-25

Town of Halton Hills

Assessment Impact of Gravel Pit Settlement File No.: F22/TA (.pdf)

Elizabeth van Ravens, Tax Analyst (.pdf)

2017-03-24

Wellington Advertiser

Guelph-Eramosa joins county’s aggregate property appeal

Jaime Myslik / Mike Robinson

2017-02-24

Wellington Advertiser

Puslinch joins county on gravel pit assessment appeal decision

Mike Robinson

 

2017-01-13

Wellington Advertiser

County councillors digging in to oppose gravel pit assessment change

Mike Robinson

(.pdf)

2017-01-12

SouthwesternOntario.ca

Wellington takes $6 million hit on gravel taxes

Phil Gravelle

 

2016-07-07

OSSGA.com

MPAC Appeal

 

2016-01-29

MPAC

Bulletin: Gravel Pits – Assessment Review Board (ARB) Appeal Update (.pdf)

 

2015-12-11

DurhamRegion.ca

Uxbridge tax base takes hit from gravel pits

Moya Dillon

2015-11-11

CambridgeTimes.ca

Gravel pit owners appealing taxes

- TAPMO warning

2014-07-08

Town of Caledon

Assessment Appeals on Gravel Pit Properties CS-2014-066  (.pdf)

[ road rehabilitation cost estimates]

2013-07-26

Wellington Advertiser

Gravel pit assessment changes

Mike Robinson

 

 

 

 

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Disclaimer: This information has been compiled through private amateur research for the purpose of allowing the reader to make an informed and educated decision.  However, while the information is believed to be reliable, accuracy cannot be guaranteed.

 

 

 

 


APPENDICES

 

https://awareontario.nfshost.com/AWARE-Ontario/Issues/Aggregate_General/Agg_Revenue.html