This year’s property assessment increases were “quite the surprise” for Kristy Van Slyck, who dug deep into the numbers and found what she believes are errors in how properties were assessed.
“When I started digging, I started to realize they (Saskatchewan Assessment Management Agency, SAMA) made a ton of changes to this year’s model,” Van Slyck told more than 30 people at the Shrine Club Masonic Temple on Sept. 9, during an information session about property taxes that the Moose Jaw & District Chamber of Commerce hosted.
The event brought together property owners, political officials and business owners looking to understand how assessments worked and why property taxes increased substantially for many. Representatives from SAMA were invited to the event but did not attend.
Van Slyck, vice-president of acquisitions and leasing with Viridian Property Corporation, and her father, Rod, owner of the corporation, looked at property data from 2019 since that’s what SAMA used when it reassessed commercial and industrial properties during a new four-year valuation cycle. The assessment was based on market conditions on Jan. 1, 2019.
“I dug so deep into this … (that) I found some really incredible information,” she said.
Van Slyck claimed that while SAMA has a public mission and vision, it also has an internal mission and vision to generate tens of millions of dollars in revenue for the provincial government.
SAMA says it strives for a quality assessment system that is accurate and up-to-date, based on professional standards, defensible, understandable, universal, cost-effective, easily administered, equitable, and fair for all property owners, she continued. But what it doesn’t do is make tax policy or set mill rates.
Van Slyck didn’t think SAMA assessed properties fairly, pointing to several properties Viridian owns that had their taxes double.
Using documents on SAMA’s website, she also claimed that the agency's decisions are not revenue neutral. While the overall effect on property taxes is designed to be revenue neutral on a municipal basis, the agency’s 2020 financial report said that property inspections would provide an extra $183 million for education and municipalities over 12 years. SAMA also believed that number would increase by 2030.
The tax gains from property maintenance and re-inspections in 2025 alone are expected to be $72 million.
“This is just showing that they are increasing tax revenue for the government and I find that slightly contradictory — not slightly, a lot,” said Van Slyck. “They are here to assess the property. They are not here to do the tax.”
Van Slyck presented a data table showing predicted rent rates for warehouses by use and quality. She pointed out that there is a “huge variance” between classes, including the doubling of values between classes two and three.
She used the example of a Viridian property on the North Service Road that is 5,760 square feet with a mezzanine roughly 240 square feet. SAMA added the mezzanine into the overall floor space and made it 6,000 square feet, which changed the property’s value. However, Viridian has never received rent for the use of the mezzanine.
Using a 4.09 per cent market capitalization rate, the property’s assessed value is now $1.13 million. The income from the building is $48,180 and taxes are more than $20,000.
Capitalization rates for warehouses across Moose Jaw range from 3.95 per cent to 8.93 per cent, with the average being 5.73 per cent. Van Slyck noted that she would make more money if SAMA put her building at 8.93 per cent since that would give that building an assessed value of $406,526.
Many similar warehouses in Moose Jaw are at 8.93 per cent, she pointed out. However, she didn’t think the capitalization rate was consistent, fair or equitable for others.
Van Slyck recommended that property owners print off the assessment report from SAMA’s website and review quality class, base rent, square footage and the market capitalization rate.
The presentation was one of several held during the event. The Moose Jaw Express/MooseJawToday.com will have additional stories on some of these presentations.
