PROPERTY ASSESSMENT APPEAL BOARD
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Annual Report - 2001 The Honourable
George Abbott Dear Minister, It is my pleasure to present the Annual Report of the Property Assessment Appeal Board for the year ending December 31, 2001, in compliance with section 49 of the Assessment Act.
Dianne Flood Board
Profile
1. Board
members as of December 31, 2001 Board Profile The Property Assessment Appeal 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 and at actual value 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 B.C. Assessment Authority. As of December 31, 2001 the Board was composed of a full-time Chair, three full-time Vice Chairs, 12 part-time members, and the Registrar. A list of the Board members and biographical notes are included in Appendices 1 and 2. An explanation of how the Board does its job is detailed in Appendix 3, and a glossary of terms used in this report is detailed in Appendix 4. The Board's Report on Its Performance In 2001, the Board's key strategy was to achieve prompt, appropriate resolution of appeals. In this way, property owners and local governments can be provided with certainty of accurate property assessments, which may have potential tax implications, as soon as possible. The activities undertaken to accomplish this strategy included:
The Board also focussed on providing accessible, comprehensive, user-friendly information to its stakeholders and the public. The primary tools to accomplish this were the Board's Web site and information guides on the appeal process.
2001 Results Compared with 2000 In pursuing the objectives for productivity, cost-effectiveness and timeliness, the Board's 2001 results compare favourably with the previous year. Some of the indicators for these objectives are illustrated in the following table
The increases
in the number of appeals completed and in the number resolved without
a hearing were due to a number of factors, including:
The increase in appeals resolved without a hearing is also a measure of the Board's goal to minimize all parties' costs. The average length of the hearings, which increased from 0.85 days in 2000 to 1.39 days in 2001, was principally due to one unusually long hearing, and is not a general reflection of typical hearing length. Figure 1 - Hearing Statistics
The enhanced timeliness in issuing decisions was due, in part, to the reduced number of hearings and more favourable opportunities for resource allocation. Figure 2 - Average Number of Days from Hearing to Decision
The average age of outstanding appeals decreased from 1.85 years in 2000 to 1.66 years in 2001. This was achieved by directing efforts to complete older appeals. This statistic was also affected by the increase in appeals filed in 2001 which reduced the overall appeal age. The number of rolls under appeal decreased from 7,169 to 4,896. Notable progress was made in resolving managed forest appeals, with the number of rolls in that classification decreasing from 2,098 to 201 rolls during the year. The Board's goals of just and consistent decisions and improved public confidence are more difficult to measure, but are, in part, reflected by the small number of requests for court review (only nine such requests in the 116 appeals for which a decision was issued). Details about these applications are detailed below, under the heading "Appeals from the Board." On December 31, 2001, 772 appeals were outstanding. These were almost evenly divided between current (397) and prior year appeals (375). Of the outstanding appeals, 453 were in active appeal management, with 173 of these under appeal for more than one year. (These multi-year appeals are managed concurrently and typically will be resolved at the same time.) Another 258 appeals were dependent on the outcome of other cases before the courts or the Board, and were being held in abeyance, pending that determination. The breakdown of outstanding appeals by status is detailed in Figure 3. The total assessed dollar value of the properties under appeal was $12.9 billion, up slightly from last year. This increase can be principally attributed to the higher number of appeals filed in 2001. Figure 3 - Outstanding Appeals by Status as at December 31, 2001
If requested by a party, the Board is required to file a stated case to the B.C. Supreme Court. Decisions of the Supreme Court may only be appealed to the B.C. Court of Appeal, if that Court gives permission (called leave to appeal). At the beginning of 2001, nine stated cases from previous years were still outstanding before the B.C. Supreme Court. In 2001, the Board was requested to file another nine. By the end of 2001, 12 of those had been decided, with the Board's decision confirmed in seven and referred back to the Board in five. At year end, six stated cases were still before the B.C. Supreme Court. At the beginning of 2001, two leave applications were outstanding from previous years. In addition, leave to appeal was requested in seven of the 12 cases decided by the B.C. Supreme Court in this year. Leave was granted in five, denied in one, and not yet heard in three others. In addition to the five cases in which leave was granted in 2001, five others were still before the Court of Appeal, leave having been granted in earlier years. That Court heard and decided one case in 2001, with leave to appeal to the Supreme Court of Canada denied in that case. One case before the Court of Appeal was abandoned. A total of eight cases were outstanding at the Court of Appeal at year end. In 2001 the Board continued to improve public access to information using the Board's Web site. Board decisions were posted and can be easily searched using keywords. Directions and guides about how to file an appeal, the appeal process, and guidance about assessment law and valuation determinations were also made available on the Web site. The Board held a public forum on its rules in the fall of 2001, which was well attended by a cross-section of the assessment community. The purpose of the forum was to consult with stakeholders on ways to make the Board's processes more efficient, while still meeting the requirements of natural justice and procedural fairness. The Board will hold further consultations with stakeholders in 2002. The challenges for the Board in 2002 include:
The Board has set the following targets to be achieved by December 31, 2002:
The Board's ability to achieve these targets, however, will depend on a number of factors outside its control, including:
The number and complexity of the 2002 appeals will not be known until after the April 30, 2002 deadline for filing appeals. As a result, the resources required to deal with those new appeals and the Board's ultimate ability to achieve these targets cannot be determined with precision at this time. Due to the Board's
quasi-judicial nature and the corresponding requirement to apply
the principles of natural justice, targets for resolving appeals
with or without a hearing are not appropriate. The Board will, however,
continue to use alternative dispute resolution processes to complete
appeals in an appropriate and timely manner. If a hearing is required,
the Board will continue to conduct those hearings in an efficient
and effective manner. In addition, the Board will endeavour to maintain
and, if possible, improve on its current timeliness in issuing decisions.
The actual time required to issue decisions will vary reflecting
the complexity of issues. While independent from government in reaching decisions on appeals, the Board is accountable to the Minister of Community, Aboriginal and Women's Services for its financial operations. The Provincial Government recovers the costs of the assessment appeal system, including the Board, from the British Columbia Assessment Authority, which imposes a levy on assessed properties. 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
on an annual budget allocation from April 1 to March 31 each fiscal
year. Figure 4 - Budgeted Expenditures v. Actual - by Fiscal Year
There was also a decrease in the average cost per completed appeal, from $1,407 in 2000 to $1,030 in 2001, primarily due to the increase in completed appeals in 2001. Appendix 11 provides a more detailed analysis of expenditures for the 2001 calendar year. The majority of Board costs are incurred in overall operations, including appeal registration, appeal management and settlement conferences. The Board has reduced costs by resolving more appeals without a hearing, making greater use of single-person instead of multi-person hearing panels, and implementing up-to-date office automation and database software. Appendix 1: Board Members as of December 31, 2000
Appendix 2: Biographical Information of Board Members Dianne Flood
Rob Fraser
Simmi K.
Sandhu Cheryl Vickers
Rosemary
Barnes Paula Barnsley
Louis Chan
Patrick Conroy
Lawrence
(Larry) R. Davies Ron Kennedy
Fred Lee Errol Nembhard
Shiela D.
Toth Wes Umphrey
Candace Watson
W. F. (Rick)
Watson Appendix 3: How the Board Does 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. 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 2001 roll was completed by December 31, 2000 and the valuation date was July 1, 2000, with a "state and condition" date of October 31, 2000. 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. 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. Valuation appeals to the Board may involve single family residences and recreation properties to hotels, shopping centres and office towers, cement plants, 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, whether strata units are entitled to residential classification, and the correct classification of manufacturing and transportation 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. Liability appeals have included floating casinos and port facilities. The Commissioner's Rates appeals have involved fibre optic cables, and how their value should be determined and allocated. 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 deadline set by the Act, that the appropriate fee has been paid and that the notice of appeal meets statutory requirements. The next step is to assign the appeals for case management. Case management is carried out primarily through appeal management conferences (AMCs) conducted by the Board's Registrar, Vice Chairs, or the Chair. The main purpose of an AMC is to identify, narrow and/or resolve 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 subsequent 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. AMCs 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 AMCs 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. If the parties propose a settlement, another Board member will review it to ensure it meets the Board's mandate for accuracy of the roll. Even if a settlement is not achieved on all matters in dispute, issues are inevitably narrowed and a subsequent hearing will typically take less time and be conducted more efficiently. If the appeal cannot be resolved, the focus of appeal management shifts to ensuring the parties are properly prepared for hearing and the hearing is as efficient as possible. To achieve this, the Board may make a number of different orders such as 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. Parties are entitled to know each other's case and to be heard on the issues, and the decision must be made by an impartial panel. To meet these requirements, the Board has enacted Rules of Practice and Procedure. The Board has a duty to act fairly in applying the rules and in conducting appeal hearings. 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 hearing procedures are made available to the parties in advance of the hearings, so they 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. The Board may conduct hearings in person, by telephone, or on the basis of written submissions. In-person hearings may vary in length from less than one day to several weeks. 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 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 fully prepared so that hearing time is effectively and efficiently used. After conducting a hearing, the Board issues a written order detailing its decision and reasons. In making decisions, the Board must consider and weigh the evidence admitted at the hearing. 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. 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. 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, not all appeals can 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, under the Assessment Act, a person affected by a decision of the Board may appeal on a question of law, by a stated case to the B.C. Supreme Court. 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 Completion
or Completed Decision
Decision
in Progress or Decision Pending Desk
Order Invalidity
Order Outstanding
Appeal Pending
Court/Board Decision or Pending Precedent Per
Diem Protective
Appeals Recommendation Resolution
or Resolved Roll
Number Scheduled
for Hearing Single
Member Panel Status Withdrawal Appendix 5: 2001 Appeal Completion Results Compared to Results for 2000
Total percentage of completed appeals by the year of original filing
Appendix 6: Completion Results by Appeal Year
Method of Completion of Appeals in 2001
Appendix 7: Board Activities in 2001 Compared to Prior Years
* This reflects an unusual situation where one agent filed and then abandoned over 300 appeals. Appendix
8:
Summary of Outstanding Appeals at December 31, 2001 Compared to
December 31, 2000
1
Includes all outstanding appeals to the Board from the 2000 and
earlier rolls.
Appendix 9: Outstanding Appeals and Value by Region
Regional Distribution of Outstanding Appeals
Appendix 10: Outstanding Appeals Value and Assessment Year by Classification at December 31, 2001 The following shows the breakdown of outstanding properties by classification and assessment year. The statistics are based on the number of rolls (rather than the number of appeals) because an appeal can involve several rolls, which may have different classifications.
1 O/S: Outstanding
“Other” includes all those classifications not individually shown. Appendix 11: Analysis of Expenditures and Outputs Annual Expenditures by
Category
Expenditures per Completed Appeal ($000s)
Notes:
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