PROPERTY ASSESSMENT APPEAL BOARD
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Annual Report - 2000 The Honourable
Jim Doyle Dear Minister, It is my pleasure to present the Annual Report of the Property Assessment Appeal Board for the year ending December 31, 2000, in compliance with section 49 of the Assessment Act.
Dianne Flood Board
Profile
1. Board
members as of December 31, 2000 Board Profile The Board is a quasi-judicial administrative tribunal established under the Assessment Act to hear appeals from decisions of the Property Assessment Review Panels. The Board's mandate is to ensure that property assessments are accurate, at actual value and applied in a consistent manner in the municipality or rural area. As such, the Board plays an important part in ensuring the accuracy and integrity of the assessment roll. The Board's objectives are:
The Board is independent from government, the Property Assessment Review Panels and the BC Assessment Authority. Its members are appointed by Order in Council and for most of 2000, the Board was composed of a full-time Chair, three full-time Vice Chairs, and 14 part-time members, and the Registrar. Appendix 1 lists the Board members as at December 31, 2000. A brief biographical note about each Board member is included as Appendix 2. An explanation
of how the Board does its job is detailed in Appendix 3, and Appendix
4 is a glossary of terms used in this report. The Board's Report on Its Performance In the year 2000, the Board focused on providing the earliest possible resolution of appeals, increasing the certainty of the property assessment roll and reducing the risk to property owners and local governments. The key strategies employed to accomplish this included: Continuing to re-direct the parties' focus and efforts from an adversarial hearing process to a collaborative approach to resolving appeals, without a hearing if possible, while ensuring compliance with the statutory requirements of accuracy and equity. Expanding appeal management to include more appeals, to provide greater opportunity for the parties to work toward resolution without a hearing, or if that is not possible, for orderly and efficient hearings. Further development of the Board's Web site to provide a user-friendly research tool and easy public access to information about the appeal process, the appeals that have been filed, and Board orders and decisions. The statistical reports contained in Appendices 5 through 11 show the Board's activities and results in 2000, with some comparisons to earlier years. The 1,539 appeals before the Board in 2000 included 820 new appeals filed in that year, plus 719 backlog appeals from 1999 and earlier years. In 2000, the Board completed 791 (or about 51%) of the 1,539 appeals. These completed appeals were comprised of 489 (or 60%) of the new 2000 appeals and 302 (or 42%) of the backlog appeals from earlier years. 682 of the appeals completed in 2000 were resolved without a hearing. A hearing was required for 143 appeals. The Board's results in 2000 compared with 1999 In 1999, the Board completed about 67%, or 1,433 of the 2,152 appeals then before the Board. The completed appeals were comprised of 706 of the then new appeals and 727 of the backlog appeals. Almost 1,200 of the completed appeals were resolved without a hearing, with 228 appeals going to a hearing in 1999. As anticipated, the number of appeals completed in 2000 decreased, compared to 1999. This was due to two factors:
With fewer properties in the backlog, resolutions affecting multiple years are decreasing. The new appeals tend not to be under appeal in a previous year, and thus require more time and attention. As indicated by the appeal completion results statistics in the appendices, older appeals tend to be resolved less quickly than newer appeals. Also, almost half of the remaining backlog appeals are being held pending court decisions on the issues in dispute. However, despite the complexity of the backlog appeals, the Board's success in resolving some of the older appeals is indicated by the decreased average age of the outstanding appeals, from 2.13 years in 1999 to 1.85 years in 2000. The Board's activities in 2000 compared with 1999 In 2000, the Board considered and issued orders in 337 appeals based on joint recommendations of the parties, compared to 568 orders in 1999. Board orders were also issued in 345 appeals that were either withdrawn or found to be invalid in 2000, compared with 630 such orders in 1999. 143 appeals required a Board hearing in 2000. Hearings took place over a total of 121 days, a decrease from the 228 appeals heard over 160 hearing days in 1999. (Some appeals take more than one hearing day, while on other days more than one appeal is heard). 57 of the hearing days were conducted by two or more panel members in 2000, providing some orientation for the new Board members appointed in 2000, compared with 60 such hearing days in 1999. These hearings resulted in the Board issuing 109 decisions in 2000, compared to 235 such decisions in 1999. Decisions were issued more promptly in 2000, with an average of 56.2 days from the hearing to the decision in 2000, compared to 74.2 days in 1999. The Board made more extensive use of case management in 2000, holding 559 appeal management conferences, involving 960 appeals. In 1999 the Board held 499 appeal management conferences, involving 1,050 appeals. (As the backlog is reduced, the number of properties in appeal for more than one year is reduced, so the number of case conferences that involve more than one appeal will also be reduced.) Only 22 settlement conferences were held in 2000, compared with 25 such conferences in 1999. The appeals outstanding as of December 31, 2000 748 appeals remained outstanding: 417 backlog appeals and 331 current appeals. 407 appeals were in active appeal management. Of these, 163 were protective appeals, with the property having an outstanding appeal from one or more earlier years. Typically, when a protective appeal is resolved, more than one appeal year is completed. A substantial number of the appeals in active appeal management are managed forests. These appeals have not yet been resolved, partly due to the magnitude of the roll numbers involved (over 2,000 roll numbers) and the number of years in appeal. Most of these appeals tend to be from the Vancouver Island Region, with some in the Interior and Northern Region. 280 of the outstanding appeals were being held in abeyance, pending determination by the courts. Of these, 202 were backlog appeals. Substantially all of the appeals within the utility classification are in this category. As soon as the court issues a decision on a particular issue, the Board will commence appeal management on the related files. Decisions were in process on 28 appeals, either after a hearing, or as a result of a recommendation from both parties or a withdrawal request by the appellant. On the decision being issued, those appeals will be complete. As of December 31, 2000, 33 appeals were scheduled for hearing in 2001. Figure 1 - Outstanding Appeals, by Status as at December 31, 2000
If requested by a party affected by a Board decision, the Board is required to file a stated case on a question of law to the B.C. Supreme Court, for that Court's consideration. A decision of the Supreme Court may only be appealed to the B.C. Court of Appeal if that Court grants permission, which permission is called "leave to appeal." In 2000, the Board filed 14 stated cases at the Supreme Court, as requested by a party. In addition, 14 other stated cases and one application for judicial review were still outstanding from earlier years, for a total of 29 cases before the Supreme Court. 15 of these cases were withdrawn, abandoned or dismissed in 2000. The Supreme Court referred five of the decisions back to the Board for further consideration. As of December 31, 2000, nine stated cases were still to be decided by the Supreme Court. Also in 2000, two applications were made for leave to appeal a decision of the Supreme Court to the Court of Appeal. These applications had not been decided as of December 31, 2001. In addition, seven other cases from earlier years, for which leave had been granted, were before the Court of Appeal. In 2000, the Court of Appeal upheld the Board's decision in three of those cases, with the remaining four cases still to be decided by the Court. In 2000 the Board remained committed to improving public access to information about the appeal process. To achieve this goal, the Board's Web site was enhanced to provide user-friendly research functions. Now any interested person can follow the progress of an appeal from filing to completion. Board decisions are posted, and can be easily searched using keywords. Directions and advice about how to file an appeal, the appeal process, and guidance about assessment law and valuation determinations are now easily available from the Web site. Information and assistance on the appeal process is still easily available by calling or visiting the Board's office and from other locations such as government agents' and assessment authority area offices. E-filing of appeals is now also available. Public access to information has been greatly improved by implementation of the Board's new appeal management computer system. In 2000 the Board was proud to receive a Public Service Gold Award for Excellent Use of Technology for the development and implementation of this new computer system. In receiving the award, it was noted that enhanced appeal management and improved customer service were two of the benefits of the new system. The challenges for the Board in 2001 include:
Based on past experience, the Board has set the following targets for 2001: To resolve:
The Board's ability to achieve its targets depends on a number of factors that are outside its control, such as:
These factors are unknown until after the April 30 annual deadline for filing appeals. As a result, the extent of the resources required to deal with those new appeals, and the ability to achieve the Board's targets, cannot be determined with any degree of precision until after April 30. In addition, the Board cannot predict when or how the Courts may resolve the issues that are before them, nor the implications that the court decisions may have on the contingent Board appeals. While clearly independent in its decision-making capacities, the Board is accountable to the Minister of Municipal Affairs for its financial operations. Pursuant to section 17(5) of the Assessment Authority Act, the Provincial Government recovers the costs of the assessment appeal system, which includes the Board's expenditures, from the British Columbia Assessment Authority, which imposes a levy on properties subject to assessment. How the Board accounts for its operations The Board controls its operations and reports on them in a number of ways, including:
The Board's budget and how it is managed The Board operates within its current budget allocations and continually looks for ways to improve its financial performance. Figure 2 shows the budgeted and actual Board expenditures for the past five fiscal years and the budgeted and estimated expenditures for 2000/2001. Appendix 11 provides a more detailed analysis of expenditures for the year 2000. Figure 2:
The costs per completed appeal in 2000 ($1,408) show an increase from the previous year due to:
These variables have a significant impact on yearly costs per appeal, making it difficult to make year-to-year comparisons. Appendix 1: Board Members as of December 31, 2000
Appendix 2: Biographical Information of Board Members Dianne Flood
Rob Fraser
Janice Leroy
Cheryl Vickers
Laura Acton
Rosemary
Barnes Paula Barnsley
Louis Chan
Patrick Conroy
Lawrence
(Larry) R. Davies Ron Kennedy
Fred Lee Bernie Leong
Errol Nembhard
Shiela D.
Toth Wes Umphrey
Candace Watson
W. F. (Rick)
Watson Appendix 3: How Does the Board Do Its Job? The Assessor is obligated to complete the assessment roll by December 31 in the previous year, and assessment notices are mailed to property owners on January 1. The properties are to be valued by the Assessor as of July 1 of the previous year, based on the property's physical condition and use as of October 31 in that year. For example, the 2000 roll was completed by December 31, 1999 and the valuation date was July 1, 1999, with a "state and condition" date of October 31, 1999. If a person is not satisfied with an assessment, a complaint must be filed to the local Property Assessment Review Panel no later than January 31. The Review Panel conducts hearings over a six week period, ending mid-March in each year, and must make their decisions by April 1. If a party is not satisfied with the decision of the Review Panel, an appeal must be filed to the Board by April 30. The number of appeals filed in a year may depend on a number of factors, including market volatility during the previous calendar year. The Board typically receives about 1,000 appeals annually. What may be appealed to the Board? Parties may appeal:
In addition, the Board is the first level of appeal against the Assessment Commissioner's Rates and for appeals under the Forest Land Reserve Act. As soon as an appeal is filed, the Board starts work. All appeals are processed as quickly as possible, to provide the earliest possible certainty of the assessment roll, for both property owners and local governments. The Board's first step is to review each appeal to ensure that it has been filed within the time set by the Act, the appropriate fee has been paid, and that there are no deficiency or validity issues (that is, that the notice of appeal meets the statutory requirements). The next step is to assign the appeals for case management. Valuation appeals to the Board range from single family residences and recreation properties to hotels, shopping centres and office towers, marinas, hydro generating stations, and pulp mills, to name just a few. The classification issues before the Board have varied significantly and included whether properties qualify for farm classification; when land under construction is entitled to residential classification; and the correct classification of shipping facilities that serve industrial properties like grain elevators and loading facilities. Exemption appeals have included entitlement to the pollution abatement exemption; and the entitlement to an exemption for properties used for activities that are of demonstrable benefit to all members of the community. The Commissioner's Rates appeals have involved fibre optic cables, and how their value should be determined and allocated. Case management is carried out primarily through appeal management conferences (AMC's) conducted by the Board's Registrar, Vice Chairs, or the Chair. The main purpose of an AMC is to identify, resolve and/or narrow the issues in an appeal. This can result in the settlement or withdrawal of an appeal without a hearing, thereby contributing to the quick and cost effective resolution of an appeal. If case management does not resolve the appeal, the hearing will usually be shorter and more efficient. An AMC may be held at the request of a party, but generally the Board takes the initiative to arrange these conferences. AMC's are usually conducted by telephone, but may sometimes be held in person. Parties are required to participate, if they want to proceed with their appeal. During a conference the parties are required to discuss and clarify what is really at issue in an appeal. The parties may be ordered to produce documents and reports to each other and also, where necessary, to the Board. The Board can make orders to compel parties to meet these obligations. Depending on complexity and other factors, several AMC's may be held for one appeal, or several appeals may be considered at one AMC. If a party fails to comply with a Board order, the Board may sanction the party by requiring them to pay costs, or in extreme cases, by dismissing the appeal. The Board's computer based information system ensures the progress of virtually all appeals is tracked and managed as necessary by either the Registrar, a Vice Chair, or the Chair. Recommendations and Withdrawals Often appeal management is a catalyst for further discussions between the parties. Sometimes an appellant will decide to withdraw the appeal. In other cases, the parties may submit a recommendation to the Board for an order to change the assessment roll. The Board carefully reviews the reasons given by the parties for the proposed change. If it is satisfied the proposed change will ensure accuracy of the roll, the Board will issue an order, without a hearing being required. Parties may also be required to attend a settlement conference, conducted by a Vice Chair, trained in settlement and mediation skills. Another Board member will review the proposed settlement to ensure it meets the Board's mandate of accuracy of the roll. Even if settlement is not achieved on all matters in dispute, issues are inevitably narrowed and a subsequent hearing will be a more effective use of time and other resources. If the appeal cannot be resolved without a hearing, the focus of appeal management shifts to ensuring the parties are properly prepared for hearing, and to ensure that both hearing and Board member time is used as efficiently as possible. To achieve this, the Board may make a number of different types of orders, for example: the preparation and production of statements of agreed facts, statements of issues, evidence and legal principles, and witness lists. The Board may also order that appeals with common issues, similar properties or related owners be heard together. Due to the volume of appeals and to ensure proper notice to the parties, appeals are scheduled for hearing several weeks or months in advance. In the interim, recommendations or withdrawals may still be submitted, and if accepted, the hearing will be cancelled. As a quasi-judicial tribunal determining rights, the Board must apply the rules of natural justice and procedural fairness, so that the proceedings are fair to both parties. In exercising its discretion under the Board rules, and in how it conducts appeal hearings, the Board has a duty to exercise that discretion fairly. While appeal management will usually address these issues prior to the hearing, in a few limited cases, a hearing may have to be adjourned, to ensure all parties' rights are properly addressed. While this may conflict with the Board's objective to resolve appeals in a timely manner, the duty to be fair must be given the highest priority. In conducting hearings, the Board usually follows a standard procedure, which is similar to but less formal than court procedures. Information sheets on the hearing procedures are made available to the parties in advance of the hearings, so the parties can properly prepare. As such, the parties do not have to have a lawyer to represent them. The Board is not required to apply the strict rules of evidence that a court would. The Board may accept any evidence it thinks would be of assistance. Appeal management assists in ensuring the parties disclose evidence in advance of the hearing, so there are no surprises at the hearing. Depending on the nature and complexity of an appeal, the hearing may be conducted by a single Board member or a panel, usually composed of three members. Hearings may vary in length, from less than one day to several weeks. Where appropriate, the Board may conduct a hearing by written submissions, or by telephone. The appeals that do go to hearing often involve complex appraisal issues or are appeals for which a legal decision is required to provide direction for the future. In these cases, appeal management ensures that the parties are prepared so that hearing time is effectively and efficiently used. After conducting a hearing, the Board issues an order, setting out its decision in writing, including its reasons for making the decision. In making its decisions, the Board must consider and weigh the evidence admitted at the hearing. The Board must also consider any directions the court has given in previous cases about how to interpret and apply the Assessment Act and Regulations. While it is not bound by its earlier decisions on an issue, the Board aims for consistency, or to explain any reason for an apparent inconsistency with an earlier decision. Due to the volume of appeals and complexity of some hearings, writing the reasons may take some time. All parties are sent a copy of the decision, and if a change is ordered, the Assessor must amend the assessment roll. In some cases, due to the complexity of the issues, resolution may take several months, or in some limited cases, even years. Often these appeals establish precedents for future assessment rolls, and may have impacts for more than just the property under appeal. As a result, despite the Board's best efforts in that regard, not all appeals will be resolved within the year they are filed. The Board's decisions on factual matters are final, and there is no right of appeal. However, a person affected by a decision of the Board may appeal on a question of law only, by a stated case to the B.C. Supreme Court (Assessment Act, s. 65(1)). Stated cases may be filed because a party believes the Board was wrong in its decision, or the legislation and/or the case law on the issue is unclear, or the party is dissatisfied with the current state of the law. Stated cases must be started within 21 days of receipt of the Board's decision. The Board is required to prepare the stated case and file it with the Court within a further 21 days. A party may appeal the decision of the Supreme Court to the B.C. Court of Appeal, with leave (permission) of that court. Appeal Management
Conference (AMC) Appeal or
Appeal File Backlog Completion
or Completed Decision
in Progress or Decision Pending Decision Desk Order Invalidity
Order Outstanding
Appeal Pending Court/PAAB
Decision or Pending Precedent Per Diem Protective
Appeals Recommendation Resolution
or Resolved Roll Number Scheduled
for Hearing Single Member
Panel (SMP) Status Withdrawal Appendix 5: Summary of Outstanding Appeals at December 31, 2000
1
"Backlog" appeals means all outstanding appeals to the Board from
the 1998 or earlier rolls. Appendix 6: Change in Outstanding Appeals During 2000 Table A examines the changes during 2000 in the status of appeals.
Average age
of all outstanding appeals (as at December 31, 2000): 1.85 years Appendix 7: Comparative Schedule of Results
1The Appeals Dismissed for Non Compliance are included in the numbers for Withdrawals/Invalidity Orders Processed, above. Appendix 8: Comparative Schedule of Results - Hearings in 2000
Appendix 9: Appeals by Status and Region at December 31, 2000
1 Figures for AMC/SC (Appeal Management Conference/Settlement Conference) Scheduled and Protective Appeals are included in the numbers for Appeal Management in Progress.
Appendix 10: Appealed Properties and Value - By Class The purpose
of this table and charts is to show the breakdown of the properties*
that are the subject of outstanding appeals to the Board (as at
December 31, 1999), by classification and assessment year. They
also show the total assessed value of all appealed properties for
each classification.
1Percentage of folios appealed to Board in year that remain outstanding
Appendix
11: Analysis of Expenditures and Outputs
Notes:
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