City hall stands to lose nearly $400,000 in tax revenue based on the number of recent successful property assessment appeals, although it could recover that money in a few years.
A report from the board of revision presented during the recent city council meeting showed that of the 154 appeals from property owners last year, 15 were eventually successful because of confirmed errors.
The appeals were made because of re-valuations in the 2021 tax assessment roll. The Saskatchewan Assessment Management Agency (SAMA) reassesses Saskatchewan properties via a re-valuation every four years, resulting in an influx of appeals at the start of the re-valuation period.
Based on the successful appeals, the total change to the roll from regular appeals resulted in a decrease in property assessments of $30,841,710 compared to more than $40 million in 2017, the last re-valuation year.
During a recent media scrum, city manager Jim Puffalt confirmed that a decrease in assessments would result in city hall losing $380,000 in tax revenue.
“It’s people’s right to appeal. It’s the nature of assessment that people have that right. And if the assessments are wrong, we shouldn’t be charging those amounts,” he said. “That’s the process we go through every year, and … by the time they’re finally done, the last time, a number of them were overturned and came back to the city in property taxation.”
City hall will feel the economic pinch from these reassessments this year, Puffalt added, which means city administration will work through this issue before bringing forward the proposed 2023 budget in early December.
There is the possibility that the City of Moose Jaw will recover that funding if the past is any indicator.
During a July 2021 council meeting, finance director Brian Acker explained that city coffers saw a boost in municipal taxation in 2020 after SAMA provided city hall with money from the 2017, 2018 and 2019 property assessment appeals.
“Those decisions have been in the city’s favour and (resulted) in a significant increase in funding for 2020. For future years, there will be some benefit as well, although this can be tempered by future assessment appeal decisions,” Acker said.
Also, Acker said during a council meeting in December 2020 that city hall faces a regular struggle with property assessments because some residents appeal their assessed value every year, even when a provincial body rules in favour of the municipality.
So, while the first year of re-valuation cycles usually leads to taxation loss for city hall, SAMA, the board of revision and the Saskatchewan Municipal Board eventually rule in favour of the municipality, enabling it to recover some money.
The next regular council meeting is Monday, April 11.
