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November 7, 2018

HOUSE OF ASSEMBLY PROCEEDINGS

Vol. XLVIII No. 38

The

House met at 10 a.m.

MR. SPEAKER (Trimper):

Order, please!

Admit

strangers.

Orders of the Day

MR. SPEAKER:

The hon. the Government House

Leader.

MR. A. PARSONS:

Mr. Speaker, I call from the

Order Paper, Order 6, second reading of Bill 34.

MR. SPEAKER:

The hon. the Government House

Leader.

MR. A. PARSONS:

Mr. Speaker, I move, seconded

by the Minister of Natural Resources, that Bill 34,

An Act To Amend The

Assessment Act, 2006, be now read a second time.

MR. SPEAKER:

It is moved and seconded that

Bill 34, entitled

An Act To Amend The Assessment Act, 2006, be now read a second

time.

Is it

the – oh, I'm sorry, be now read a second time. Thank you.

I was on

a bit of a routine.

MR. A. PARSONS:

I like the way you're

thinking.

MR. SPEAKER:

Thank you.

Motion,

second reading of a bill, “An Act To Amend The Assessment Act, 2006.” (Bill 34)

MR. A. PARSONS:

Thank you, Mr. Speaker.

I'm

standing here today to speak to Bill 34, which is

An Act to Amend the Assessment

Act, 2006, which is a piece of legislation that I think everybody knows the

importance of. We're talking about the evaluation of real property in this

province.

What I'd

like to do is perhaps provide the genesis for how we are here, why we are here

and to talk about what this amendment does, which really is going to have some

positive effects for taxpayers and for homeowners and property owners in this

province. I think this is a really positive step that we are taking here today

with this piece of legislation.

So what

I can say is that this – and I think this is a part of the mandate for the

Minister of Municipal Affairs and Environment's mandate letter. I'm standing up

and talking about this today and presenting this bill, but the reality is the

lion's share of this work was done prior to me coming into this department. The

lion's share of this work was done leading up to this, and I want to thank the

previous minister for the work that he did on this file. In many cases, I've

stepped into this department and I've taken over, but the work has been there. I

get to stand up and talk about the positives, but this is something that took a

lot of time.

The

other thing – I always like to do this and I think we need to do it – is I want

to thank the staff of Municipal Affairs and Environment for the work that they

have done on this file. This is not a bill or an amendment that was done just in

a small room without thinking about anybody. There was a tremendous amount of

consultation that had to be done to make this Assessment Act amendment a

reality. We had to consult with the Municipal Assessment Agency, which is based

in Grand Falls-Windsor, work with them and talk about the realities of the work

that they do, how it can be done and how it can changed. And we had to work with

MNL.

I can

tell you in the time that I've had here doing this work they've been a

tremendous organization to work with. We've all got experience working with MNL,

given the fact that they represent all the municipalities in our province. But

having that hands-on working relationship with people like Tony Keats and with

Craig Pollett, I want to thank them for the working relationship that we've had.

So, we worked with them.

This

bill is something that came out of – a lot of us knocked on doors in 2015 and

one of the things that I think a lot of us heard on the doorsteps was at the

same time we were knocking on their doors, people were getting their letters

from the Municipal Assessment Agency and there was a lot of questions asked. I

think one of the things that I've asked staff to do is work with the agency. I

think there's a real education process that needs to happen when it comes to

property assessment because I think there's a real – I can't say

misunderstanding, I'll say non-understanding and I've certainly been guilty of

that as well. And if I'm guilty of it, I'm assuming that a few other people are.

How does this process work?

There

are complex algorithms that are used to come up with this data, with this

information. But the reality is that most of what we know comes in a letter that

tells us whether our property has gone up or gone down. In many cases, when it

goes up, it means money coming out of our pockets. When money goes out of our

pockets, we start to question what's going on.

So when

we were all knocking on doors in 2015, that was one of the things we heard is

people had questions and said what's going on here, how does this work. The

other thing, there has been a lot of issues and maybe the best way for me to

talk about it is talk about the fixes that we're making, what it is they're

fixing and why we are fixing that.

The

changes that we have – and I have the bill here – are two things. One of them is

changing the actual cycle. One of the issues that we had is that it's been done

on a three-year cycle, which there are a lot of things that change in three

years when you're getting an assessment back that, in many cases, doesn't seem

consistent with the reality in which we're living. People had serious questions

about that.

What

this bill is going to do is actually going to change the assessment cycle from

three years to one year for all municipalities that are governed or handled by

the Municipal Assessment Agency and it's going to go from three years to two

years for the City of St. John's who handle their own assessments. They don't

subscribe or pay the MAA for the data; they do their own.

One of

the issues we've had going through this was well, we knew we had to shorten that

cycle. Three years is a huge period of time. I think having a shorter cycle

leads to a better understanding – people getting better information quicker and

it seems more consistent when we have that evaluation done rather than waiting

on three years' worth of data. Sometimes it just doesn't seem to jive.

One of

the issues that we had was that what works – pardon for the colloquialisms here.

What works around the bay doesn't always work in here. The City of St. John's

was saying, look, we can't go to one year. We just won't be able to handle it,

and that's a fair point. They were happy with going to two and felt they could

handle two, but had a tough time with one;

whereas the Municipal Assessment

Agency was saying we can go to one. We can handle a one-year cycle. It will not

result in increased costs to citizens. We can handle the one-year cycle.

The

biggest change that was made in the last couple of months is: Why do we need to

have the same thing for everybody? Why should we have a one-year cycle that

hurts St. John's? Why should we have a two-year cycle that hurts everybody else?

So, we've gone with two. I think it's going to be better for everybody.

We're

going to change it so that there's a two-year cycle for the City of St. John's,

rather than three. The City of St. John's has worked with us on that and said we

can live with that. We can handle that. It will result in increased pressure, no

doubt, but it's pressure that's good for citizens. It's pressure that taxpayers

and citizens and ratepayers and municipal property owners, whether residential

or otherwise, they want this. That's who we're here to serve.

When it

comes to everybody else that's handled by the Municipal Assessment Agency, going

to one year is a very positive move. We're going to get those notices every year

now, rather than every three years. I think that it's going to lead to a better

understanding of the process and it's going to lead, for lack of a better term,

to more real information, rather than you're getting something that's based on

three years and it just doesn't seem to fit with the reality in which we're

living in terms of property evaluation and everything else. I think we've got a

change there that's going to be positive.

Some of

the stats that I have here, the act covers the assessment of more than 225,000

properties. That's a pretty big group. I know we're a small province. There's

somewhere in the range of half a million people, which is small. But this is a

significant amount of work. The MAA, I appreciate the work they do, and I

appreciate the city when they have to do their work as well.

Now,

this act does not cover taxation. Taxation, itself, comes from the

Municipalities Act or the city's act.

So this act doesn't deal with taxation, because sometimes we talk about the

assessment: well, did our taxes go up or down? That's a prerogative of the

community if they want to change the rate of taxation. That's another issue all

together. We haven't touched that because I don't think it's our job. I don't

think it's our responsibility, and I don't say that in a way of – I think that's

the town's responsibility. I don't think they want us encroaching on their

ability to make their decisions.

Now,

I've said it a lot and I'll say it again. I've said it at the MNL Conference.

I've said it at every meeting I've ever had with municipality. Municipal

governance is the toughest level of governance. It's tougher than provincial,

it's tougher than federal.

We're

all sitting here, and it's hard work. We all know that, and we're compensated

for that. But when you see the work that municipal councillors are doing and the

remuneration they get, which is next to nothing, I got to tell you, I appreciate

every single councillor and mayor that is out there. It's a tough job.

SOME HON. MEMBERS:

Hear, hear!

MR. A. PARSONS:

And we try to do our best to

work with them and make their lives easier, but at the same time, I don't think

it's our right to go in and make their decisions or take that decision-making

authority away. That's why they run, so they can make the decisions that are the

best interest for their particular community. So they handle the taxation.

that's just one of the changes that we've talked about here. We've changed the

cycle from one year – sorry, to one year and to two years.

The next

thing we did was we changed the mandatory assessment roll preparation date. It's

currently September 30. So that's when they've got to get the information

compiled and start sending it out.

Now,

you'll notice some communities right now – I think, actually, in the City of St.

John's, if it's not sent out already, it's in the process. It is behind

schedule. And I'm not saying that to lay blame or to pass fault here. I'm just

saying that's the reality.

What

we're changing is we're going to change it from September back to August 31. So

all municipalities will have to get that information out by August 31. And

that's important, because it means it's getting in citizens' hands quicker so

that they can see this. This is also very important for one of the next changes

that I'm talking about here, which will come – show what we're dealing with

here. So we want it August 31.

Right

now, there's no power to compel them to make sure that it's done. We are now

going to change that, so that if a community or the City of St. John's wants to

delay that or can't come up with it, they have to ask permission of the

department. And I don't think it's permission that will not be granted, but I

think it's better for the municipality. I think this is a good pressure.

Pressure

is not a bad thing. Pressure helps us make decisions; helps us get things done.

There is a pressure to get this done, and the reason the pressure is good is

because it's in the best interests of the citizens that we serve. So what we're

saying now is you need to, if you want an extended date, you must get

ministerial approval.

Now,

it's not about me doing that. I might not be in this chair next week. It doesn't

matter about the minister. The minister could be any minister, any government,

any party, any administration. It's about accountability for whoever sits in

this chair. Municipalities need to ensure that they're getting this information

out. I think this has an enhanced accountability provision now to make sure that

the tax assessment rolls are done by the end of the summer. It means they're

going to receive the assessment sooner, which leads to the next change.

We're

increasing the owner's appeal period from 30 days to 60 days. That is a very

positive step, in my opinion. It is one we've heard repeatedly from citizens.

One of the situations that I've seen, and I can't tell you if it was 2015 or

2016, but people were getting their new assessment later in the season, in some

cases November, and what was happening was that appeal period, which was 30

days, was putting you right into Christmas.

Let's be

honest, people have a lot of things going on Christmastime, right? Trying to

make sure that all the good stuff that comes with Christmas or the holidays is

dealt with, and they were missing this. They weren't seeing this. And trying to

get something done like that during the holiday season when kids are off school

and you're off work or whatever else, was very difficult. So we're extending

that period from 30 days to 60 days. When you think about it, we're rolling back

the date, so the information should be out quicker; we're extending the appeal.

There

was a lot of people – I had people coming to me, and I always put myself in the

same situation. I can remember this, getting my assessment very late, and I'm

sitting there Christmas and I'm looking at it, and I'm saying, jeez, I feel like

if I want to appeal. I have that ability to appeal. I've done appeals. But when

you take a lot of citizens are getting it late, everything else that they're

dealing with and they got this appeal period that's running right into

Christmas, people were not having that ability to appeal the decision. So we're

just giving them an extra opportunity, if they want to do that.

So you

think about the changes so far, Mr. Speaker. We're making the information more

consistent, and on a yearly basis, which I think makes it more accurate, or more

cognizant of reality, rather than getting something after three years and

saying, how did we end up with this? Rolling back that period to give people

more opportunity – we're going to get it quicker and we're extending the appeal

period.

All in

all I think these are very positive steps. I would note that MNL is supportive,

MAA is supportive, and when we talk about – because one of the questions you

often get asked in debate is who did you talk to? Who did you consult with?

Well, these consultations were done in the summer of 2016. So this has been a

long time coming. There's been a lot of work here.

There

were public consultations. There was specific stakeholder groups, online

feedback forms, toll-free phone number, email and regular mail. There were 61

submissions. There was work with, again, groups like MNL who deal with

municipalities.

This is

something that there was a lot of work done. I go back to the people in the

department, the people that aren't here on the floor of the House that don't get

seen but they actually do the work. I'm here talking about it, it's their hard

work. To everybody in Municipal Affairs and Environment, who aren't recognized –

SOME HON. MEMBERS:

Hear, hear!

MR. A. PARSONS:

And then every department

that's doing this legislation, we get to stand up and talk about, and as

governments, we all get to take credit for it. They're the ones doing the work.

To the

deputy minister and the ADMs, the analysists, the front line, thank you. Thank

you for making your work – actually, and it sounds like a cliché, your work is

improving the lives of the people you represent, the people that you serve. So

thank you for that. I get to stand up and talk about it, but let's be honest

here, this work was done by these individuals.

Now,

I'll continue on. One thing we're also changing here is we are repealing the

special purpose property regulations to ensure that the owners of special

properties, manufacturing facilities, airports is a big one, they're going to

receive evaluation on their property based on market value.

Again,

we worked with the City of St. John's on this. We worked with the Municipal

Assessment Agency. I mean we had a situation just a few years back where this

became a very contentious issue here in the City of St. John's with the airport.

I think it was ruled that the regulations were actually not valid.

Since

that time, we've done different evaluation. It seems to be working for everyone.

I know this is an issue I believe in Gander as well, when you're talking about

these special purpose properties. So we're just repealing it because they're not

valid. We're making that change and we're going to give them, I think, an

evaluation that's actually based on the market value.

MR. LETTO:

Assessed value.

MR. A. PARSONS:

Yes. As my colleague, the

Member for Lab West, says, based on assessed value. And I think that's positive

for everyone here.

This is

not a case of government trying to get things done no matter what. This is a

pure example of listening to people and making a change based on what they say.

I don't anticipate there's going to be opposition to this from my colleagues

across the way. I do anticipate there will be questions, as there should be. Why

did you do this? Why did you not do that? But I think, overall, people will see

the positive changes that are being made here with this particular piece of

legislation.

We had

hoped to have this done quicker, but given the fact that we're in an assessment

cycle right now, these changes will happen in 2020. I think to bring these

changes in right away – we had wanted, especially, the appeal period, the 30

days to 60 days to happen right now; but making changes in the middle of a

process can probably cause more confusion than the good that you're trying to

intend to be done.

What

we're going to do, this will all be effective from 2020, when that assessment

cycle starts. And it's a case of, look, we wanted to get it done quicker, but

I'd rather it done right than quick. That's what we're doing here. We are doing

it right. I will not agree with any comment that says that we're not trying to

do it right.

I mean,

look, everybody wants things done sooner. We're all guilty of that. I want

things right away. But these things take time. If you don't think them through,

you end up in situations that can hurt people and cause confusion, and that, in

itself, would negate any benefit from what you're trying to do, from the

positive that you're trying to create.

Mr.

Speaker, I think I've said about enough on this now about what we're trying to

do. This is a case of a positive amendment to what can often be a difficult

topic when we talk about property tax and real property assessment. It's

contentious stuff, because we all want to value our properties, but nobody wants

to pay more money. That's the reality. But I think we're making changes here now

that people will recognize as being good changes. We've done it by working with

the people that know what they're doing: the MAA, the City of St. John's, other

municipalities, MNL.

I know I

have colleagues on this side that will speak to this; I know I have colleagues

across the way that will speak to it. I look forward to moving into the

Committee stage and the back and forth and comes with it.

Thank

you, Mr. Speaker.

SOME HON. MEMBERS:

Hear, hear!

MR. SPEAKER (Reid):

The hon. the Member for

Cape St. Francis.

MR. K. PARSONS:

Thank you very much, Mr.

Speaker.

It's,

indeed, a pleasure to get up here today and to speak, and I will assure the

minister that I will be supporting these amendments because they make a lot of

sense.

Mr.

Speaker, I'm a former mayor of a small town. When you're a mayor of a small

town, you get phone calls all the time. It's interesting that the minister first

talked about, probably, an education component to this, and to educate the

taxpayers in the communities of what's actually happening, because sometimes, as

a mayor, or as a councillor – and I definitely do applaud everybody that puts

their name forward to be on municipalities and to represent their towns, because

it is, it really is the hardest part of any –like the minister said, I believe

that municipal governments is really the hardest one, because you're dealing

with your friends, you're dealing with your neighbours, you're dealing with your

cousins and uncles and aunts and everybody else.

Sometimes when an assessment comes out, as soon as they see the assessment and

realize that it's gone up, well, I'll give Kevin a call; he will take care of

that for me. That's what happens in small towns. You know, he's me buddy, I'll

get him to have a look at that; there's no way I'm paying this. But they don't

realize that this is an assessment agency that comes in, it's independent of the

towns, it has nothing to do with the towns, they come in, they do an assessment,

and sometimes the assessment is based on – you could live in a small, little

lane and it's based on what the property values are next door to you, what the

piece of land got sold down the road, and that's how they do it.

They

look at the whole municipality and they say, okay, what's the price of a house

in Torbay right now that has three bedrooms in it, and has the basement done,

and it's on three-quarter-acre lots. That's how they do it. They base the

property value on what's in the area at the time, and what the houses are

selling like. And in the last couple of years, if you looked at the property

values, I know in my own district they've gone down quite a bit. They were at a

high. They were really up. It think Torbay, one time, was considered the highest

housing values in all of Newfoundland and Labrador. Right now I think it's after

going down, but I listened to the news coming in this morning and they say the

values are going back up again, and it's related to the price of oil, and that

has a huge effect on everything.

So,

people, when they get their bill, they look at their bill and right off the bat

they say, oh my God, look where it's gone; my house is worth $450,000. Sure if I

tried to sell that, I'm only going to get $350,000 for it. But it's based on the

value and the market value, but it's done over a three-year period. That's why I

like these amendments. I really do, because it comes and it takes it year by

year by year, because it changes. It changes a lot.

I really

believe that we do need to educate municipalities. Maybe there's some way that

the municipal agency can send out letters just to explain how it's done, like I

just explained. It's based on the value of the whole area. Some areas, what

you'll see is property, probably their lot sizes in one town are three-quarters

of an acre, another lot size in another town could be a half acre, and so the

money you get for a three-quarter of an acre versus a half acre, that's the

reason why it's looked at each individual municipality and see what they're

like.

Houses

could be sold in one municipality which has water and sewer, and that makes a

difference on the value of the home versus a town that doesn't have water and

sewer. People don't realize that. They don't realize what the actual basis of

their property is, so it's very important that – I agree with the minister; I

think that it's something we should really educate on. That would also help all

of our elected municipal officials. Then they wouldn't have to be explaining it

all the time and they'd have something to go to just to be able to say, look,

this is how it's done and this is why we do it.

I know,

like I said, going back to my days as the mayor that every time that assessments

came out, oh my God, the calls that you would get. I know there are other mayors

on the other side and councillors here on this side too that understand what I'm

talking about. There are Members over there that worked in the towns and they

realize what we're talking about also. So as soon as that assessment came out

you could guarantee the phone was going to ring off the wall and people wanted

you to fix it and everything else. I really believe that that's where it's to.

And that would also help the towns.

The

minister spoke a little bit about the mill rate and he said that's not part of

this; it's going to come under the Municipalities Act. But the mill rate is

something – and he said that he wouldn't interfere with it; I would never

interfere with it. It's the town's responsibility to centre mill rates. It's the

towns responsibility to take the money that they have coming in – everybody got

to realize that municipalities, at the end of the day, the money that they spend

and the revenue that got to come in got to equal zero. You cannot have a surplus

or should you have a deficit.

So, the

towns have got to have the ability to be able to provide what they want to

provide. Some towns provide unbelievable snow clearing. I know in the wintertime

you'll hear the comment how great the Mount Pearl snow clearing is –

SOME HON. MEMBERS:

Hear, hear!

MR. K. PARSONS:

– versus the City of St.

John's snow clearing, but you do hear that stuff. But, do you know what? That's

a town's decisions to make sure that they have the equipment to do the proper

work. At the end of the day, the town who wants to invest in snow clearing

equipment that costs a lot of money, or a town that says, okay, we're only going

to do it this and try to keep the mill rate down because we don't have that

money, that's the prerogative of that town to do that.

I agree

that as a former mayor we were like – I laughed at my deputy mayor at the time.

I had several arguments with him when we were doing the budget. He's deceased

now, Mr. Kevin Butt, a great guy. Anyway, I used to argue with him and say you

think that money is coming out of your pocket or what. He used to say to me:

Yes, it is. I'm a taxpayer; it's coming out of my pocket. When we did a budget,

everything was nickeled and dimed, but we supplied the service that was

necessary for our residents, but we watched every dollar we were spending.

We went

to government, and at the time we got what grants we could get. We looked at our

roadwork – and that's what towns do. They assess the amount of money they have

coming in and say, okay, what are our priorities. Is our priority fixing up the

softball fence? Is our priority making sure we have adequate snow clearing?

These

are all the things that really affect your residents, but the mill rate, that's

a town responsibility. In my district, I believe, I could be wrong, but I

believe it's probably the lowest mill rates in the province in two towns.

Another couple of towns their mill rates are up – I'm going to say two towns

have it at 4.5 or in the 4 range, and then the other ones are up around 8.9 and

9. But it's different services that you provide. Again, I give the example of

snow clearing. You can have snow clearing equipment that can do roads like you

wouldn't believe.

remember one of the first things I did when I was mayor of the Town of Flatrock

was we were always – we had contracted out our snow clearing. Myself and the

deputy mayor actually went and we looked at how about if we had a couple of

pieces of equipment ourselves, what would that do for us, and how would that

affect our budget. So we looked into it and we looked at – because when you buy

a piece of equipment it's usually over – it's not like buying a car, a four-year

term, whatever, you probably go seven or eight years on a piece of heavy

equipment, and that's normal.

So we

looked at it and we analyzed the cost of what that would cost, and it looked

like that was the best way to go. Now the town has its own equipment and they're

doing their ditching, they're doing everything else. So it worked out really

well. But that's the decision of the town to do the mill rate, and I'm glad the

government is not getting involved in trying to set mill rates right across the

province because it can't work.

AN HON. MEMBER:

It's not a good thing.

MR. K. PARSONS:

It's not a good thing at all,

no.

The

changes that are made here today now – and we'll talk a little bit about the

first one that I'm going to talk about, is the three-year cycle. Again, it's a

very positive change. Now I'd like to know, and I will ask the minister some

questions on this afterwards. I know sometimes there's a delay in getting the

assessments back to the towns.

Now that

we have a fixed date, I know you have to go for the delay or whatever to the

town, but the Municipal Assessment Agency is going to have a lot of work on

their hands. There's going to be a lot of work to be able to do this. It's a

positive thing to do, but, again, I hope they'll have the resources to be able

to do it. And that's important, because you're going to put pressure on these

people to be able to do that. So they're going to definitely need the resources

to be able to do this.

The

appeal process; I had the occasion, sometimes, of calling the Municipal

Assessment Agent on behalf of constituents of mine, mainly seniors. People

called me and said my act – and I'd call. I'd make the call. I have to say, the

people that I worked with down there are fantastic; great people to work with.

They return your call, they get back to you.

There's

one that I'm working on now that I spoke to, and the lady said, we'll give you a

call and we'll let you know when they're going to go do it. So you can make sure

that the resident knows what's going to happen.

Sometimes if you do an appeal – and this is another thing. It's a $25 fee, I

believe, that it costs to do an assessment fee. So I was wondering how that's

going to work. If that's going to stay the same or there's going to be an

increase or decrease, or whatever. That'll be somewhere we'll go. But to change

the dates – as long as we can do it on time, it can be done within that one

year, that's a very positive thing.

Moving

back the date from September 30 to August 31 is another very positive thing.

I'll put two of them into one. By moving it back to August 31, and then also

extending the amount of time you have to appeal between 30 days and 60 days, is

very important. I'll tell you why.

In a lot

of cases, I know where I'm from, we have workers that go away. I'm guilty of

this myself. I'll probably check my mail every two weeks. There are people that

will go away on a holiday and their mail builds up and they have to go get it

(inaudible), but the 30 days are up and you can't appeal.

I know

the minister talked about the holiday season, but there are also sometimes – and

a lot of times – I used to go up to my moms and dads all the time and I'd check

their mail. I'd be over getting their mail sometimes and you'd see letters on

the – it could be on their dresser, it could be on the kitchen table. It could

be there for a couple of weeks, and: yeah, that's nothing. That's only an old

assessment thing or something like that. But without even opening it. So the 60

days is very important. In 60 days, hopefully people will check it.

It's

time, because people work away. There are people that are in school. There are

people that move away for the winter. They, obviously, have somebody checking

their mail or something like that. But it's important to make that change also,

the 30 days versus 60 days. Because once the 30 days is up and you call in: no,

you can't appeal that. Your assessment came out at a certain date and it has

expired.

So,

again, not only for Christmastime but, like I said, there are people working

away. There are times that people only check their mail every couple of weeks.

Like I said, a lot of our seniors look at it and sometimes – and not only

seniors, it could be anybody. Sometimes somebody else will look at that and say:

my God, your house was assessed at $250,000. Sure, you're not going to get

$250,000 for this. You should appeal that, there could be something that's done.

Anyway, the extended time is good for everybody. It's a good thing.

The City

of St. John's had a little issue, and I'm glad that you can – we can make this

work for not only the city. A funny thing about municipal assessments for the

City of St. John's – people that work down in the City of St. John's will know

what I'm talking about. The gentleman that was in charge of it for years and

years down in the City of St. John's was Mr. Ron Cadigan. Ronnie was from my

area, a great hockey player and everything else, but I always knew Ronnie was

the one that was in charge of the assessments down at the City of St. John's. He

has since passed on. He was a great guy, but I always knew what Ronnie's job was

down at the City of St. John's.

I think

they do over 40,000 assessments all together in the City of St. John's, which is

a lot of work. There's a lot of work that goes into it too.

We heard

last year, when the assessments did come out, there was a public outcry in the

City of St. John's. We heard it on the news. I think there were a couple of

protests and everything else. That was related to the value of the homes, how

they were after changing.

Again, a

three-year period is sometimes almost a four-year period when the assessment

actually gets out. Things can change. The property values in the City of St.

John's over a couple of years change drastic. People's houses that were

appraised at $700,000 or $800,000 at the time – boy, if I can get $700,000 or

$800,000 for the house, I'd sell it tomorrow. The value and the chance of

selling the home, the market was bad. You couldn't sell your home, and the

assessed value you were stuck with for three years meant that you had to pay

taxes on something that you could never get the money for.

So I'm

glad the officials over in the department worked with the City of St. John's to

do this. Apparently, under the briefing – which I have to say was a great

briefing. I thank the people over in the department. They always do a fantastic

job with the briefing they gave us, but I'm glad they consulted with the City of

St. John's in ensuring that they were okay with this.

I think

you'll see a positive reply from people who were very concerned about this and

had huge issues with the amount of value that their homes were done in St.

John's, assessed in St. John's. I think this is a positive thing. If the city

says they couldn't do it within the one-year period, it's great to see that

we're working with the city so we don't put them in a bind to have to come up

with (inaudible).

Mr.

Speaker, the minister mentioned that the total amount of properties that are

assessed are 225,000 properties in the province. Now, we have a lot of towns in

this province that uses poll tax, and again a poll tax is basically just a flat

rate type of thing that you pay in a town. I was interested to see how many

towns are still paying poll tax. I really don't know. There's none in my area

that are paying it, but I do believe there are some still paying it in the

province, so it'd be interesting to see.

But

225,000 homes means that there's going to be a lot of work done. If it takes

three years, right now, to assess those homes, then to be able to do it all in

one year, I'm sure there will be answers to it on the cost. And the other

question, too, that brings to mind when you look at this, because there's

definitely going to have to be more cost, there's going to have to be added cost

on it to be able to do this within a one-year period versus three-year period,

and it'll be interesting to see where that cost, where you're going to recruit

the money to be able to pay for it.

I mean

it's a great thing. I'm not saying anything about cost or anything at all like

that, but it'd be interesting to see if government's going to step in and help

the municipal agency and help the towns that have to pay, because at the end of

the day whoever has to pay for it, if it's the municipalities that are going to

be added cost, that'll just be moved on down to the towns.

Again,

Mr. Speaker, I do agree that the department and the people over in the

department have done a fantastic job on this. They've done a lot of work. I

noticed that when we went over, they talked a little bit about what we heard

when the assessment act was reviewed 2006, and there was a lot of consultation.

There were 61 submissions which, it's a lot but I was thinking there'd be a lot

more, actually, because it is such a concern with people. I thought there'd be a

whole lot more people doing submissions, towns and whatnot wanting to be able to

see what's happening here.

They

reviewed the timing aspect of this, and that's what the amendments here today

are mainly about, is about timing and moving it from three years to one year,

and the City of St. John's down to two years, timing of when the assessments

come out, also the length of time for an appeal, so they addressed that. And the

assessment criteria, while it's not addressed in this bill, it's something that

I talked about earlier, the education part of it, making sure that the residents

in the towns understand.

It could

be a mail out with your bill. We all get our council bills every year and maybe

there's some kind of mail out that we can put out with each town so that

everyone can be assured that, listen, this is the reason why we're doing this,

here's what the value of your home is and it's based on the value of the

properties that are in the area.

I know

one of the appeals that I went to for a resident of mine, the property was based

on X amount of dollars, yet the property itself was mainly bog, it was on the

side of a hill, so the same type of property that was assessed, it could be a

level piece of land versus the bog – that person appealed and they came down,

had a look, and they agreed and said no, that property, that's assessed at this

much here.

When

people do get their bills, they got to understand that they can go and do the

appeal or they can call. Sometimes, the assessment people will come down and

they'll look at the property and say okay, no, we realize where you're coming to

from there.

Again,

the implementation associated with mill rate, and as the minister said, they're

not going to touch that. I agree with it. It's under the municipal act anyway

and I think that is the – I don't think government should get into setting mill

rates for towns. I think it's the responsibility of the towns to do their due

diligence and make sure that they run their towns the way that the people who

elected them wanted them to run it. If there are some areas in town where they

want to make sure that they spend money on X and X, and another town says no,

we're going to do it a little different then that's how your mill rate gets set

up. Your mill rate is basically set to make sure that the revenue you have

coming in matches the expenditures that you have going out. So, that's the

reason why I think that should be left there.

Now, the

minister did mention – the last thing that I'll mention too – special

properties. I will have several questions on this when we do get into Committee,

but when you look at taking special properties out, I can understand that it's

jobs sometimes too – and I know there was a couple of court cases on this and

both cases were ruled against the assessments. I think the City of St. John's

airport was one. When they looked at the value that they assessed – so, to

change this it will be interesting to see. I'd like to see a list of what's

included in special properties so the towns would know where there're to. It'll

be also interesting to look and to see how municipalities – I know the minister

just mentioned that time that it'll be market value. So, in some cases, I don't

know what the market value of a church would be in a community, or a recreation

facility – are they included? If they're included they're not taxed – recreation

and your facilities, like a hockey rink, and all that there.

anyway, I'll have some questions on that when the minister gets up, but it'll be

interesting to see what they are and what lists are available to see so the

towns will know what's considered as special properties.

Again,

Mr. Speaker, I'm just going to close out now. I just gave my opinion on some of

it. Again, I like it. I like the changes. I believe that the municipalities, I

know the ones in my area will also like it, and more so than anything it's the

residents that are paying the taxes, and it gives them – like I said, when

you're a municipal leader, as soon as the assessment comes out you get a lot of

calls, and maybe this will help our municipal leaders do their job a little bit

better.

It's not

that they're not doing a great job now, because most of them are, but it'll give

them a way to explain what's happening, and also, the residents, they'll have a

chance to do their appeals and give them a little bit more time to do it, which

is positive. Like I said with what happened the last time that appeals came out

in the City of St. John's, and we saw such an increase and then property values

dropped. So that time period now will change and proper assessments will be able

to be done.

again, overall, I think those are good amendments. I think we'll have some

questions in Committee, but overall I like the amendments that are done here.

Thank

you very much.

SOME HON. MEMBERS:

Hear, hear!

MR. SPEAKER:

The hon. the Member for

Labrador West.

MR. LETTO:

Thank you, Mr. Speaker.

I can't

tell you what a pleasure it is for me today to stand and to speak on Bill 34.

Because I have been working with municipal assessments since 1989, both as a

municipal leader, I worked with the Municipal Assessment Agency as the president

of MNL, and now in this position, and I know how important this is for

municipalities.

As the

Member for Cape St. Francis mentioned, many of us in this room have gone through

the municipal political world, and we know the calls that we get when taxpayers

and residents get their assessments. And in all fairness, Mr. Speaker, the

assessment sometimes causes a lot of anxiety because people don't quite

understand what the assessment value is and how it's used to determine what

taxes they're going to pay.

Regardless of what the assessment value is – and I'll say this upfront – the

onus and the tax rate is still determined by municipal government. The assessed

value is just used as a multiplication factor on what they will assess to the

value to determine the tax rate. It's a tool for municipalities, but it's a very

important tool and it's a tool that affects every resident of this province.

Now, I

can speak first-hand, where this came from and came to light, I was working as a

staffer at the time when we were preparing for the election. This came to light

in 2015 when assessed values in this province, I won't say went through the

roof, but they were places in this provinces where they did from where they

were.

One of

the places that was really affected by the assessed values of 2015 was Labrador

West. We were in the middle. When the assessments were done, which is probably

in late 2013, early 2014, we were at the peak of our boom. Prices were high,

housing prices doubled in a lot of cases, sometimes more than doubled, tripled,

and that's when the assessments were done. But, unfortunately, by the time the

assessments got into the hands of the residents and into the hands of

municipality and they were going to use those assessments to determine their tax

rates, the boom was gone. The boom was gone and we were back worse than we were

before the boom.

What

happened was the residents of Labrador West got these assessed values when the

economy was in the toilet, to put it bluntly, and people were very concerned.

You know what? It's not easy for a municipality to be able to deal with that,

because residents don't understand all the time how that tax rate is determined.

Municipalities had a big decision to make on how they were going to use those

assessed values, because the assessed values when houses were up – like I said

it doubled, that's when the assessments were done. But the lag time, the time

the assessments were used to determine the tax rate, the economy had already

collapsed and housing values were back to where they were before the boom.

What

we're doing here, Mr. Speaker, what we committed to at the time was that we were

going to try to come up with a mechanism whereby we could better determine

assessed values, and they were more reflective of the current market value, and

I think that's what this does. Going from three years to one year will help

smoothen that ride. It won't cause the ups and downs that we see today with the

three-year cycle.

And

we're into it again. Ironically enough, we're back to it again now because

municipalities, especially in Labrador West, have another dilemma in their hands

because the new assessed value that came out this year was done when the economy

was at its low, and now, the economy is starting to recover. So we have assessed

values, now, that come out that are about 33 per cent lower than they were.

Again, municipalities have to try to determine what that mill rate will be, so

that they can have current tax rates stable and revenue.

So, Mr.

Speaker, we committed to – as in the mandate letter of the Department of

Municipal Affairs and Environment, this is what we committed to: In partnership

with the Municipal Assessment Agency and Municipalities Newfoundland and

Labrador, we would immediately initiate a review of the Assessment Act, 2006 that would address the timing of assessments,

assessment criteria and implementation of the associated mill rate.

We all

know that the final one – the implementation of the associated mill rate, that

remains with the municipalities, and that's where it should remain. They are the

keepers of their revenues, and they should have the authority to determine what

mill rate they need to assess to maintain their revenue source and to be able to

provide the services that they provide.

So, Mr.

Speaker, I think we've accomplished that in Bill 34 by going from a three-year

cycle to a one-year cycle it really does that. And what it does, as I said, it

smoothens the ride.

One of

the things that the Member for Cape St. Francis was concerned about is: How does

this affect the Municipal Assessment Agency, by going from a three-year cycle to

a one-year cycle? Well, that was a concern for all of us when we started these

consultations. I happened to be in the Department of Municipal Affairs, at the

time, when these consultations were done around the province. I must say, we did

have a good response from taxpayers and from all the stakeholders involved.

I know

Municipalities Newfoundland and Labrador, when I was there as president, it was

certainly talked about. It is something that they were lobbying for and wanted

to have a better system in place that would reflect the current market value of

the properties in the province. So one of the concerns that was brought up was

how does this affect – does this cost more? The Municipal Assessment Agency has

indicated that it will be able to maintain the current fee for municipalities

for assessments, so this means there will be no additional charges to residents.

So, Mr.

Speaker, that's good news. And for those of us that don't really understand that

system regardless of the – municipalities pay that fee every year now. Even

though it's a three-year cycle, they still pay every year. They still have to

pay their assessment fee every year. And I tell you, sometimes, for a lot of

municipalities that was a tough pill to swallow, because they knew they were

only getting their assessments done every three years, so why did they have to

pay every year.

nothing will change there. The only thing that will change is that they'll get

the assessment every year. That's a good thing, so now they can at least see

that they're getting some value for their money. I know when I was involved with

municipal politics in MNL that was a big issue for a lot of municipalities: this

assessment fee. And I tell you, it's not cheap for a lot of our municipalities,

because the smaller municipality, especially, who don't have great sources of

revenue and have low revenue coming in, it was a big chunk of change out of

their budgets.

I'm sure

the Member for Fogo Island - Cape Freels, as a former administrator, would be

able to attest to that. That cheque was hard to write for a lot of

municipalities, I tell you. And there was a lot of people – and there were a few

municipalities who actually got out of the system altogether and went with a

different type of taxation. A lot of it was because of the cost they were paying

for their assessment fees. Now, larger municipalities can handle that much

better, but for the smaller municipalities it was a big concern. So hopefully,

the fact now that they're getting the assessments every year will help to move

that along.

I guess

one of the others things that was considered – and I mentioned it there a little

bit earlier – was the fact that we should leave the mill rate allocation to the

municipalities. I'm glad we've done that, because that's the right thing to do.

We give them the tools. We give the municipalities the tools to be able to

calculate their tax rates, but that final decision should be left with the

municipalities because they're the ones that are providing the snow clearing,

they're the ones that are providing the snow clearing. They're the ones that are

providing the water and sewer. They're the ones that are providing the services,

all the services, the firefighting services, you name it. Every service in a

municipality is there because the municipal council in place provides that. Mr.

Speaker, it's important they be given that authority and given that ability to

set the tax rates so that they can have the revenues in place to be able to

provide the services they need.

I'm not

going to get into the special properties because that's something that – I'll

just barely mention it, but it's something that's important. That would be more

involved with the larger municipalities, the cities who have the airports, for

instance, the breweries. The other types of facilities that are there that are

special properties, but I think it's the right thing to do. That we assess them

the same as any other property and give them an assessed market value. I think

that's the fairest way to do it, and it allows the municipalities and the cities

to be able to generate the revenue they need.

Mr.

Speaker, for a minute, let me go back to the consultations. These are very

important consultations. I remember in the summer of 2016 we started those. That

was just after Budget 2016 , and we

weren't the most popular people on the ground at the time, but this was

something that we put out there.

remember being in the consultations and taxpayers showing up. I think we had a

pretty good response from Newfoundland and Labrador, from the residents, and

people were concerned at the time. This was a big issue in 2015-2016. I'm glad

to see that 87 per cent of the submissions that came into the consultations came

from taxpayers because they're the people that are most affected by this, and

there's only one taxpayer. They're the people that are most affected, and we did

have a good feedback.

I just

want to mention a couple of things they brought forward and some of the more

popular things. They wanted to see more equitable or uniform assessments,

because they were seeing too much rise and fall and it was causing concern for

them. They were concerned because – again, I speak for my district, the District

of Labrador West, where they had such variation in from one assessed value to

the other.

It was a

big concern for them, and I think what concerned them the most was that the high

assessed values came in at a time when a lot of people lost their jobs. A lot of

people lost their jobs. There were a lot of layoffs. There were people that were

struggling, and to get this, it wasn't really a bill, but to get this statement

in the mail saying that your assessed value is $300,000 or $400,000, where it

was probably less than $200,000 the previous one, was a shock to them. So they

want to see it more uniform.

As I

said before, Mr. Speaker, going from the three to one year, I think will help

that. And they wanted the shorter assessment cycle. That's what the taxpayers

want, and this is what came out of it.

“Taxpayers have difficulty with a three year reassessment period, particularly

in the event that the market has continually risen in each of those years. There

was a preference for a base assessment year closer to the actual year of

taxation and therefore more reflective of current economic conditions. Taxpayers

recommended either two year, or one year cycles, and some submissions

acknowledge potential administrative difficulties in a short cycle.” But I think

we've overcome that fear.

Mr.

Speaker, we've listened. We've listened to the residents of the province, and

what we've done, going from three to one year, I think takes it really – well,

you can't go much more often than that, obviously. But we've listened, and I

think the taxpayers will be very pleased with the fact that we're doing that.

“Taxpayers feel there should be some mechanism to mitigate significant

increases. It was suggested in some submissions that there should be a maximum

percentage increase, an assessment increase limit, or some sort of cap or phase

in approach to mitigate any sudden impact to property owners when market

conditions change.” Again, that's the reflection of what happened in Labrador

West.

I think,

again, the assessed values, if we do it the year, they're not going to be such

drastic changes. But we have to remember, the bottom line is that that authority

and that responsibility lies with the municipality. They have that authority to

implement the tax rate that they feel is necessary for them to generate the

revenue.

“Taxpayers feel that municipal budgets and the setting of mill rates

significantly contribute to assessment issues. Many participants suggested that

assessment values are not as problematic as the mill rates assigned by

municipalities.”

And

that's understandable, Mr. Speaker, because regardless of the assessed value, if

the assessed value goes down, the mill rate goes up; if the assessed value goes

up, the mill rate goes down. That's putting it as simply as I can, because

municipalities are not out to gouge their residents. They want to maintain a

consistent revenue. So in order to do that, they have to adjust the mill rates

accordingly to the assessed value.

“It was

stated that in a market when property values rise, municipalities do not

adequately lower their mill rates, thereby generating extra revenue.”

Mr.

Speaker, that may be a perception that's out there. I don't think municipalities

take advantage of that. Municipalities will only accept the mill rates they need

to generate the revenue, as I said, to provide the services. I think going from

the three to one year cycle will help them to achieve that and certainly will

give some feeling of ease to the taxpayers that you won't see the drastic

changes.

They

also said they “find it difficult to understand their assessment, or obtain

adequate information from the assessors about how their property was valued.”

That's always going to be an issue, Mr. Speaker.

The

assessors that go around from the Municipal Assessment Agency to do those

assessments, they have a mechanism in which they do that. They know what they're

doing, but sometimes it's hard for residents to understand sometimes why their

property values go up or down, depending on the situation. I think the more

often the assessor does it the better that people will understand that as well.

So, Mr.

Speaker, I'll just say that – and as the minister has said, and as the Member

for Cape St. Francis has said, there's a lot of work that's gone into this Bill

34. It may be a short bill. It may be a bill that people see that's known as

simple, but I tell you, Mr. Speaker, there's been a lot of work.

Like the

other speakers before me, I want to thank MNL. Because I was part of that for

years, I know what they put into it, the Municipal Assessment Agency. There were

a lot of meetings. A lot of time has been put into that, Mr. Speaker, but

they're confident they can adjust to this new

schedule without any additional

cost to the municipality.

That was

our biggest concern when we started this and that was the first conversation we

had with the Municipal Assessment Agency, was to make sure – we didn't want to

do anything that would add any extra cost to the municipalities, because we know

how much an issue that is with municipalities when they had to write that cheque

to the Municipal Assessment Agency. It's wasn't easy for them to do. We had to

make sure that there was no additional costs on them with anything that we did

with any amendments that we made to the Assessment Act that would improve the

service but we also didn't want to increase the cost either. I think we've

accomplished that.

I want

to thank the Municipal Assessment Agency for all the work that they've done. I

know many of them, especially the executive director, and many of them on the

board I know. It's a big decision for them. I'm glad that they came on full tilt

and I certainly look forward to working with them.

Mr.

Speaker, finally, I do want to thank the people of Municipal Affairs and

Environment for the work that they put into this. I know, as the minister

stated, there has been a lot of work through the deputy minister and the

assistant deputy ministers and all the people, staff within Municipal Affairs,

there has been a lot put into this.

Mr.

Speaker, this is a great bill. It's a long time coming. It's a great bill and it

will help municipalities and, most importantly, it will help the taxpayers of

this province.

Thank

you, Mr. Speaker.

SOME HON. MEMBERS:

Hear, hear!

MR. SPEAKER:

The hon. the Member for

Ferryland.

MR. HUTCHINGS:

Thank you, Mr. Speaker.

Glad to

rise today to speak to Bill 34,

An Act to Amend the Assessment Act, 2006. Some

of the discussion we've had related to the bill, looking at the particular

amendments, particularly related to the timing of assessments, the effective

date of those assessments in terms of availability and the activities that a

municipality has in regard to preparing things like their annual budget,

extended period of time during which taxpayers may appeal their assessments. I

understand that is going from 30 to 60 days to allow, again, the ability of a

home owner or a property owner to have time to look at any new assessment, what

that change would be and to have due course to address that if they had concerns

with it.

As well

to remove all references to special purpose properties or reproduction cost

valuation from the act as properties are no longer classified as special purpose

properties. I'll speak to that. As a former minister of Municipal Affairs that

was something I was certainly aware of over the past number of years, some

issues in regard to the prior legislation, I think it was

section 18 that the

designated properties, special purpose properties and some of the challenges

with that. I think there was two Supreme Court decisions in regard to that, and

they were unique properties that didn't often fit in to the normal comparative

analysis of values of property.

remember we had areas like airports, maybe a brewing facility and different

entities like that. There was a significant list and it would be interesting to

see in Committee how that will be assessed because I do agree that there needed

to change and support some of the initiatives as we get in and have some of the

questions to see where I go on this. But it'd be interesting to see where this

goes from here now in regard to those properties, their uniqueness, and how that

value is determined, and how they get to a fair assessment rate.

Some of

these are significant operators, significant employers, the types of operations

they are, and goes to their bottom line in regard to how they can operate today

and what the costs are. With some of the strains we have today in regard to

operating costs, it's going to be important for these facilities, what they're

going to be charged in regard to comparable taxation. So that could affect their

ability to operate in the overall taxation scheme that they're under here in the

province. It will good to have a good discussion on that, how we're getting

there for those properties and what they're going to look like.

Originally, special purpose property, which are going to be based on this bill,

that will be removed. In the past it meant it is a real property that has a

design or layout, or is constructed of special materials or in a manner that

restricts its use. So that's what was used in the past. We're going away from

that now, and the amendment will look at making that change.

The

Assessment Act, obviously, comes under

the purview of Department of Municipal Affairs and Environment, and establish,

overall – this is going to do and does, the legislation – a system of real

property assessment throughout the Province of Newfoundland and Labrador.

The act

came into effect in January 1, 2007, and there think there were some amendments

made in 2012. An assessment is, basically – and most people out there would

understand, and are familiar with it in regard to vacant land property you have

or your home, your personal residence, a cabin you may have that's within

municipal jurisdiction, a small business, any kind of industrial sites.

Everybody's familiar with the estimated value of a property for municipal

taxation purposes within that municipal boundary.

So a

number of factors considered in a property assessment, such as location; size;

condition and age of a building, all those types of things; type of

construction; something as similar as a two-story house with a basement,

finished basement areas, those kinds of things; existence of other buildings;

commercial features; lot size; adjacency, oftentimes, to various other services

as well.

As the

minister indicated when he introduced the bill, assessments in Newfoundland and

Labrador currently carry out over a three-year period and this bill addresses

that in regard to the timeline. That dates back to the last decade and some of

things we've seen in regard to the escalation of properties over a very short

period of time.

When

economy gets very hot, and there are a lot of activities, industrial,

commercial, which is driving economic activity and oftentimes, in that

environment, you get a very quick increase in property and land value. That

often results over a three-year period and the fourth year when it is

implemented, there's significant increase for all concerned in those property

owners. Whether it's a home residence or whether it is a business property, you

see that driven, and that causes some concern and strife for people in regard to

what they need to pay and their overall operations of a household or even a

company.

Most

municipalities in Newfoundland and Labrador, the body used to do those

assessments is the Municipal Assessment Agency. The only one that does not use

that, or is not required to use it, is the City of St. John's who has its own

assessment process.

I've

heard some municipalities, I think in the past were able to opt out of the

Municipal Assessment Agency. I'm interested when we get into Committee to see if

that's still applicable, or if there's a requirement for all municipalities to

use the Municipal Assessment Agency outside the City of St. John's.

The

minister did say, when he got up to introduce the bill, he talked about 225,000

properties. So, where we're going from three years and reducing it back,

obviously there's more work to be done in a shorter period of time. It'll be

interesting in Committee as well to see is the Municipal Assessment Agency being

reshaped.

Obviously, there are more activities, more requirements, more work to be done.

Does that mean that this Municipal Assessment Agency is going to be changed in

terms of structure, in change of budgets and what they're going to charge?

Because, right now, my understanding is a municipality is charged for the

municipal assessment when it's done. That an extra charge that's going to be –

is that passed on to the municipality and what's the operating cost of the

agency? Is that going to change? How much is it going to change? Are we going to

see more staffing there?

From a

clarity point of view, I think it's important that that's discussed and outlined

for municipalities out there as well, what change is coming in regard to the

agency. Because while we may agree with the changes here and more work in a

shorter time period, what's that going to mean to being able to execute it and

make sure that work gets done. So, that's something we certainly want to ask the

minister in Committee.

In 2016

– and I think why we're here is that I talked about some of the significant

changes in regard to land value with an economy. Many residents of the province

saw new assessments and there was a lot of concerns. I saw it in my own

jurisdiction, own district, in regard to new assessments and concerns that were

raised. The base rate for the 2016 assessment was 2014, so that's the lag time I

was talking about before and some of the concerns that were expressed by

property owners and felt that property values did not reflect the 2016 values. I

guess that's where we're to.

So if

the economy is going well and you have a downturn with significant projects,

megaprojects, the oil and gas sector in regard to what was happening offshore,

those are winding down. Or you get a slowdown in something like production where

oftentimes we've been as high as 38 per cent of our revenue in the province

comes from the oil and gas sector. So that's pretty significant. If that starts

to wane or fall off, properties and values go with that. So that's some of the

genesis for what we're talking about here today and the actual bill.

August, my understanding, 2016, government – and the minister spoke to this as

well in regard to MNL, Municipalities Newfoundland and Labrador – to undertake a

review of the Assessment Act and talk about some of the issues that are being

debated in Bill 34. Some of the items there that needed to be looked at, as I

mentioned, the timing of the assessments, the assessment criteria, what would be

used in that, the implementation of associate mill rate by municipal councils.

That's

an issue the minister spoke to, and my colleague from Cape St. Francis as well,

in regard to the independence of local governments to set mill rates, set

property rates, because that's tied to their requirement to bring in a balanced

budget every year and projected for the future year. So they need that authority

to continue to do that, and they're accountable to do that under the

Municipalities Act. And that will continue is my understanding. That prerogative

would be theirs, because they're the elected officials on the ground in local

governments that make those decisions.

The

other part for the review was, as I said, the designation of special purpose

properties and what would be done with that. Because my understanding is the

system that was in place – and after the judicial reviews, I think maybe 2014 or

2015 that stopped. So this would give some guidance on how those properties

would be assessed in the future.

Government carried out a consultation in August and September of 2016 with

various stakeholder groups. The minister said submissions from various groups as

well. They could do it through telephone, email or online. My understanding, we

were told 61 written submissions were received by the department; 53 of those

came from taxpayers or property owners, five came from municipalities and three

came from assessment-related agencies.

In terms

of what they heard, there was a broad spectrum of requests and concerns brought

forward to enter into the discussion of bringing forward this bill, Bill 34.

Special

purpose properties; regulations were deemed to be somewhat discriminatory and

were struck down, as I said, twice by the Supreme Court. They're not seen to be

used since that time, as he indicated as well.

I know

in my time, too, as minister, we had a lot of discussions with many of these

special purpose property owners. As I said, great concern in what the format was

and how it was developed then and the guidelines that were under the previous

section of the act,

section 18, in regard to special purpose activity and

property. I'm glad to see that government has taken this on, and we'll see what

the exact details are when we go to committee and have a discussion on it.

The

department also noted that other provinces have more property assessment

resource material available online in the province. Maybe that gets to the issue

of an awareness and understanding and all of those things that people desire to

know when you're taxed. Where does it come from? How is it evolved? What goes

into it? If I don't agree with it, what's the process I can go through to have

my concerns addressed? It seems some of these are addressed here in the bill.

I am

sure jurisdictional reviews were done in regard to what models exist for

somewhat unique properties in this jurisdiction and others, and what's been

used. I'll certainly ask some questions in Committee as well with regard to that

and what other jurisdictions had to offer and did we adopt anything from those

jurisdictions. Certainly, jurisdictions who have similar properties that were

previously designated as special purpose properties and see what they do and if

we adopted any of the regulatory frameworks that they may have in place.

As well,

my understanding is officials worked with authorities to develop public

education materials. I know my colleague from Cape St. Francis, who has

experience as a former municipal leader of a town, spoke about that and the

importance of that, and certainly from his own perspective. There's nothing

better than getting someone that's been in that role that knows the importance

and can articulate clearly the importance of that information. I think that's

positive, that any time we can provide information and to make residents aware

of what's available, what their options are and why we're doing something is

extremely important.

As well,

referenced the appeal process that goes from 30 days to 60 days which allows

people to have an opportunity to express some concern if they're not in support

of what they get from the Municipal Assessment Agency.

So those

are some of the things as we go through the bill that stands out. I certainly

look forward to going into debate in Committee and looking at some of the finer

points of the bill, to assess it to see how we move forward with the particular

bill.

Thank

you very much.

SOME HON. MEMBERS:

Hear, hear!

MR. SPEAKER:

The hon. the Member for St.

John's East - Quidi Vidi.

MS. MICHAEL:

Thank you very much, Mr.

Speaker.

I'm

pleased to stand this morning and speak to Bill 34, the

Assessment Act . It's important I think, that even when a bill is as

straightforward as this one that we do speak to it and raise broader issues that

are part of the bill. This bill, obviously, is a technical bill in the sense

that it deals with the timing of the assessment process, the effective date of

assessments and everything around the process of the assessments of real

property.

So in

that sense, it is technical but it also is very practical in terms of the

customer, in terms of the resident, in terms of people who own property, because

it is going to, number one, make the process more streamlined; and, number two,

it's going to make sure that assessments are done in a much more timely fashion

to match the fluctuating house market, as has been pointed out by both the

minister and also by my colleague from Labrador West.

outlined the difficulty that happened in Labrador West when you had such a

distance in time between the assessments being done – or the three-year distance

between assessments being done and an assessment being done when the market rate

was quite high. Then by the time it became an effective assessment, the market

having dropped and people being caught in a terrible situation of being assessed

at a value for which their house no longer was the value. So this is getting at

situations like that, which are extremely important.

I'm not

going to go through all the sections of the bill because I think the minister

did that. And it's been done by the Member for Labrador West, and it's been done

again by the Member for Ferryland, and I think maybe the Member for – I can't

say your district, Sir.

MR. K. PARSONS:

Cape St. Francis, a beautiful

district.

MS. MICHAEL:

Cape St. Francis. Cape was

coming out. It is a beautiful district. It's one of my favourite places for

going for a drive on a nice, sunny day. I think of the Member every time I go

down that way.

So I'm

not going to go through all the technical points again because, obviously,

they're pretty straightforward. Of course, I shall be supporting the bill. I

mean, there's no question about that. It's been needed and required.

actual fact, the minister's mandate letter of 2015 said the minister should

review the Assessment Act, 2006 to

address the timing of assessments, assessment criteria and implementation of the

associated mill rate, in partnership with the Municipal Assessment Agency and

Municipalities NL.

This was

in the mandate letter of three years ago. So it has been a wait getting to where

we are now, but we need to point out that the amendment we're dealing with in

this bill addresses the timing of assessments, as asked for in the mandate

letter, but does not address assessment criteria and implementation of the

associated mill rate. These were not recommended for legislative amendments, we

were told by the officials from the department.

I would

like to mention the assessment criteria, because it seems to me that's one of

the things that people question; that's one of the things that property owners

question, especially when they see a major shift in their assessment and they

haven't seen much of a change in the market value. Then they wonder, what

exactly is it that's being used as a criteria to make the assessment? So I'm not

sure why that has not been dealt with by the minister. Perhaps in Committee I

can get an answer to that one, but I think it's an important question,

considering the fact it was in the mandate letter.

With

regard to the mill rate; as was pointed out by the Member for Labrador West, the

mill rate is set by the municipalities. I think that's where it is and that's

where it needs to be, because municipalities are in a difficult situation.

Because they always have to have a balanced budget and because their revenue

source is mainly property tax, if they don't have control over the mill rate

then they really can be in a very, very difficult situation. So I think that

needs to be where it is.

There

are a couple of points I'd like to make, more general points, but I think they

are important ones.

Assessment of the property is important because of the nature of our taxation

system for municipalities. We say that property tax is the way to raise money.

So there has to be a way then of evaluating the properties in order to tax it.

The property tax itself is what is called an

ad valorum tax

based on value; based on the principle that the amount of tax paid should depend

on the value of the property owned. The difficulty is that basing our taxation

system – and it is related to the assessment, so that's why I'm bringing

it up. The assessment happens because of the nature of our taxation system.

Based on our taxation system, the tax doesn't relate to

somebody's income. It relates to the value of the house in which the person or

persons live in their property. So, for example, if somebody, such as a senior

citizen, has been living in their house for a long time and have been able to

meet their bills and able to pay their taxes, if all of a sudden for some reason

the assessment of that property goes up based on the property's value and the

person on fixed income doesn't have an increase in their income because they're

on a fixed income, it can cause real difficulty because of the fact that the

taxation is based on an asset that the person owns rather than the person's

income.

So property tax in that sense is blind to the payee status.

Municipal leaders can face collecting the tax knowing that perhaps they have

senior citizens that can't pay, who need to stay in their home, and may be

making choices between buying groceries and paying their taxation or paying the

utility bill. I know some municipalities make some adjustments and they do try

to recognize people's situations, but the bottom line is that municipalities

depend on that revenue. So you get stress on residents who live in their own

homes.

There have been different options that have been looked at

by people, maybe in government. I know MNL and other people who look at this

whole issue of property tax and say maybe there's a better way in which to go.

Some of the options that have been put forward in different areas are

recommendations that would include property tax being capped

at a flat rate, and there are ways in which that could be assessed. That's one

thing that could be considered. You might still have to have, in some ways, an

evaluation of property. I don't know. I think you can do it without having the

ad valorem aspect to the tax.

looking at capping a flat rate, the property tax system could be eliminated

altogether in favour of a flat rate, period, that isn't based on the value of

property, or a taxation system based on the income of individuals who live in

the property. You could have a blended commercial and reality tax.

I think

these are three of some of the major things that are being thrown out there as

ideas. Right now, we have the tax that we have, and that's why we have to have

our assessment agency and that's why we have to have the

Assessment Act , because of the way in which we do it. But perhaps we

could change how we help municipalities raise revenues rather than through

property tax based on the value of the property.

MNL has

floated the suggestion that the provincial government transfer a portion of the

HST permanently to municipal governments based on the percentage of tax revenue

generated within each of their boundaries. That would be very helpful to

municipalities. Government says the minister has said they are sitting with MNL.

They sat with MNL when looking at the assessment. I would suggest, I hope they

are still sitting with MNL looking at the different proposals that MNL has about

raising revenue that would be different from property tax.

If a

portion of the HST went to municipalities it could provide up to $100 million

annually to the municipal government sector. The HST technically is a regressive

tax, disproportionately impacting those with lower incomes. We know that. It is

significantly less regressive, though, than the real property tax and would

therefore improve the overall repressiveness of the municipal tax system. I

think it's really something to be considered.

addition, the HST is an efficient tax. It is difficult for taxpayers to avoid

and easy to collect and administer, because it's being done all the time by

government. So it's a matter of looking at the percentage that could go to

municipalities, again, based on the tax revenue that gets generated in their

boundaries.

Doing it

this way would also be very easy administratively because it would be part of

the system that's working now, and you would get revenue to municipal

governments, based on the portion generated within their boundaries, which I

think is very fair.

I think

it'll be a while before we see changes. If it took three years to get to where

we are now with the assessment piece, I think it's going to take us several more

years before we get to looking at a different taxation system. I encourage

government to do it. I know MNL wants government to look at it.

So we

will see the Assessment Act in force for some time to come. Because of that, I'm

glad to see the changes that are being suggested, or that are not only

suggested, that government would like to see happen through this bill. I think

these changes are good changes. As long as we have the Assessment Act, I think

it is important that we make sure that the process for assessing the properties

is a good one.

But, as

I said, I will ask in Committee for an answer from the minister with regard to

why the criteria of assessment has not been dealt with in this bill, as was

required in the mandate letter.

Thank

you very much, Mr. Speaker.

MR. SPEAKER:

The hon. the Member for Mount

Pearl - Southlands.

MR. LANE:

Thank you, Mr. Speaker.

It's a

pleasure to stand and speak to Bill 34. I have a few comments on it. I don't

want to be too repetitive, but I do want to put my points out there for the

record.

Mr.

Speaker, first of all I'll say, as everyone has said, I certainly support this

bill. I will be voting for it. I do have some of the same questions,

particularly around the special purpose properties, the new assessment model,

and I guess I look forward to Committee of the Whole to hearing those answers.

More

than likely, before it gets to me, the Official Opposition would've already

asked the questions and received the answers, so I probably won't have to. But I

do look forward to hearing those questions, and if there are any questions that

aren't asked, then I will certainly be asking about those.

I just

want to comment very quickly – and I appreciate where my colleague from St.

John's East - Quid Vidi is talking about. I spent eight years on city council in

Mount Pearl, and I was the Avalon director with Municipalities Newfoundland and

Labrador at one point in time. I've heard from a lot of municipalities over the

years, and particularly the rural ones, who have challenges in raising money

because they just don't have the population base, quite frankly, and the

business base that you would have in the urban centres to be able to generate

the same amount of revenues.

course, there are economies of scale. Obviously, the more people you have living

in an area and the more business you have that are all paying taxes, then you

create an economy of scale. There's a lot more money going into the pot, usually

in a denser population area and it allows you to provide, perhaps, more services

and recreation and everything else. That's just a reality of life. That's not

unique to Newfoundland; that happens everywhere.

I do

understand what the Member is saying about the HST. I've certainly heard

municipalities talk about the gas tax as well. But one of the things that we

have to be cognizant of in this House – and while I do appreciate them wanting

to raise more money, is that if we were to take, for example, HST or a portion

of our HST or a portion of the gas tax, and give it to a municipalities for

their area, while I'm sure they would welcome that and it would benefit them and

benefit their municipality, that's money that we don't have.

That's

money that doesn't go in to education, health care or so on, or it's a more a

challenge in terms of our growing debt and deficit and everything else. While

it's great to say that – and I understand why they would want it and I think we

should work with municipalities to try to help them, if we can, to raise

additional revenues, it's important, just for the record, that we all understand

– and I'm sure we all do – that any money that is coming in, any revenues coming

into the provincial government that gets transferred to another level of

government is money that we don't have for the services that we have to provide

and so on.

You

can't have it both ways. You can't have the money here and then have it over

there. So then that means we would either have to cut certain programs or

services that are being provided by the provincial government or increase taxes

or continue to borrow more money. I think that it's important to put that in

context, while appreciating the fact that municipalities, particularly the

smaller ones, do have challenges raising revenues and we have to do all we can

to support them, and I certainly do.

This

particular bill, Mr. Speaker, as has been said, is really dealing with

assessments. The most important

part in this bill from my perspective, at least,

is not so much around the changing three years to two years in the case of the

City of St. John's or changing three years to one year in terms of all other

municipalities – although that is important. It's good to have

consistency. It's good for people to understand when they get their assessment

every year to have a more accurate picture of what their assessed value is so

that you're not into a situation where you have sort of a boom-bust scenario and

you're getting assessed on the boom, even though you're in the bust, if I can

put it that way.

Or vice-versa, because it could also work the other way,

you could be in a situation where your property values were assessed low and all

of a sudden, within that three years, a big boom happened and all of a sudden

your assessed value is very low when you feel it should be much higher. But at

least by doing this, people have an accurate reflection of their property values

based on today, not based on three years ago.

So I see some benefit in that, but let's not kid ourselves,

because the reality of how it works, because somehow – someone could be

listening to this debate and get the impression – I've had people who've had

that impression, thinking that because everyone's property value is assessed 20

per cent higher than it should be, that means by fixing that you're going to pay

20 per cent less taxes. That's not true at all, because municipalities set their

mill rates every year for every budget.

I'll take the City of Mount Pearl as an example. If they

have an annual budget – I'm not sure what it is now. I think it's somewhere

between $50 million and $60 million, something like that, if memory serves me.

If the City of Mount Pearl needs $50 million, we'll say, because they have to

achieve a balanced budget by legislation, they can't borrow money and so on.

Every year, the books have to balance.

So if the City of Mount Pearl needs $50 million, then they

need $50 million. If all of a sudden the Assessment Agency lowered the value of

everybody's property by 20 per cent and they had a 20 per cent shortfall in

revenues, well guess what? When they do their budget, they're going to set the

mill rate to recover that 20 per cent. If the City of Mount Pearl, if assessment

values went up, for argument's sake, and the City of Mount Pearl were going to

realize a 20 per cent increase, if you will, then I would hope and I would

expect – and I know when I was there that the city would then lower their mill

rate to reflect the $50 million that they need. They're not going to take $60

million if they only need $50 million.

Now, people are always skeptical – and I get it, people are

always skeptical. There's no doubt, because it's not a perfect science .

If assessments go up or down and the city has to make an adjustment, there's no

way that you can make an adjustment and set a mill rate of a certain percentage

to get that exact number. It's just not going to happen. So when you set your

mill rate based on assessed values and based on what you need – so if you needed

$50 million, chances are if you set your mill rate you're not going to get $50

million right on the nose. Depending on if you raise it a point or a half point

or a quarter of a point, you're going to be a little above that 50 or a little

below. I can guarantee you, the municipality is not going to go below.

So,

arguably, they'll always take – if there's going to be an adjustment, it's going

to be probably a little bit more than what they actually need. I think most

people sort of feel that way. I think that's pretty accurate, because you also

have to bear in mind that they don't usually change their mill rates every

single year. Usually it's every couple of years, or every three years or

whatever. Sometimes it might go a little bit more and then you got enough of a

buffer to get you through a couple of years before you have to raise the mill

rate again.

So this

whole sense that because the assessed value is not reflective of what it is

today, as long as it's consistent, and every business and every property and

every household is a higher or lower than the reality of the market, whether you

change that every year or every three years, the reality is the municipality is

still going to set their mill rate to get the money they need. In that sense, it

really doesn't make a big difference I suppose.

The part

that does make a big difference, though, is the whole concept of the appeal

process. To my mind, that's the most significant change in all of this is the

appeal process. Because now the assessments have to be out by the 31st of

August, as been said, and now residents have not just 30 days, they have up to

60 days to appeal.

If you

look at August 31, that brings them up to the end of October. So you've got to

the end of October to appeal. It gives you lots of time, for the case of people

who – maybe they work offshore on the rigs or they go back and forth from

Alberta, maybe they're on vacation, maybe they don't check their mail, like I

think the Member for Cape St. Francis said. He doesn't check his mail sometimes

for a couple of weeks. I'm the same, probably.

I think

it's important that people get their assessment in plenty of time and they have

plenty of time to appeal. That's the important part, as far as I'm concerned,

the most significant part, because whether rates go up or down, whether

assessment rates go up or down as a whole, individual properties, regardless of

that, can be assessed improperly for any number of reasons.

Somebody

used the example, I think it might've been the Member for Cape St. Francis,

talked about someone building on a bog versus someone who wasn't, and even

though – when you're just looking at it on a map and sort of applying a rate to

a neighbourhood, the person doing that assessment may not take certain things

into account that would create exceptions in neighbourhoods, where there might

be a property here or a property here that doesn't fit the norm for whatever

reason, and therefore their assessed value, perhaps, should be lower than the

other one.

That's

where it's important that people have that right to appeal those anomalies or

mistakes, or whatever else can happen. By giving people that information in

advance, and giving them plenty of time to make sure that they actually get that

assessment, plenty of time to do that appeal and to have that process over and

done with, as the Acting Minister of Service NL and Minister of Justice and

Public Safety said, getting through this process before we get into the

Christmas season where people are, without doubt, have other things on their

mind. So it's certainly more convenient. It's more, what's the word, I'm going

to say user-friendly. That's probably not the exact term, but I think everyone

knows what I mean.

So that,

to me, is probably the most significant piece, the greatest benefit. The one

year versus three year certainly adds more clarity, or the one year versus two

year in the City of St. John's adds more clarity. Absolutely, the right thing to

do. I'm sure that'll be great because at least municipal councillors won't be

getting as many phone calls. I'm sure they'll be glad to see this, because they

won't be getting as many phone calls from people saying: I can't believe my

property is assessed at this much, what's this all about? So it'll end some of

those headaches.

Like I

said, at the end of the day, in terms of taxpayers' dollars coming out of a

taxpayer's pocket to pay their municipal taxes, whether we do it one year, three

years or whatever, the municipality is getting its money that it needs

regardless of what assessment value. They'll simply adjust the mill rate up or

down to get the money they need to operate, to balance their budget, which is

their mandate by law.

So the

only other piece in this, of course, is the special purpose property, as I

indicated. I look forward to a couple of questions in Committee of the Whole on

that.

listened to the Member for Ferryland, I believe he mentioned something about a

couple of court cases that have basically judgments that have determined that

this is not an appropriate means of taxation. So that would be the impetus for

making the change. If that's something that needs to be done to ensure that

everything is done properly, above board, legally, within the confines of what

the courts have determined as fairness and justice to taxpayers, then that's

what we need to do, and I would obviously support that.

The

final thing I'll say is I'm very glad to see that this was something that proper

consultations did take place. It was put out there to the public, put out there

to municipalities. I understand in listening to the Member for Lab West and the

minister that Municipalities Newfoundland and Labrador are onboard with this.

I'm assuming the municipal administrators group also would be onboard with this.

The Municipal Assessment Agency are onboard with this.

The only

other thing I will say, and this relates to the Municipal Assessment Agency.

It's been said, and I look forward to hearing the answer to this question as

well. One of the things that kind of puzzled me a bit was if we're going to now

do what used to be done in three years, do it in one year, the question is, how

do you do that without increasing resources.

The

Member for Lab West said – and I'm not putting words in his mouth, but I'm

pretty sure he said – that the MAA, Municipal Assessment Agency says we can do

it, and that's great. I believe he also said they can do it within the budget

they have and that there will be no additional fees charged back to

municipalities to make that happen. I think that's what he said.

MR. LETTO:

That's exactly what I said.

MR. LANE:

Okay. He said that's exactly

what he said. That's great news.

My only

question is, how are they going to achieve that? Because, theoretically, you

have three times the work now, because you're going to do in one year what used

to be three years, so it's three times the work. Unless there's some, I don't

know, new technology, new formulas or something, or you're going to eliminate

jobs in the MAA, you're going to say to people working at the MAA, you and you

and you who used to do job A, we're not going to provide this anymore. We're

cancelling that and we're going to hire three new people to do assessments, or

we're going to offer you a job to do assessments. I can't see how the same

people can do three times the work.

The only

way that could happen would be that the people that are doing the work are only

working one-third of the year and the rest of the year they're not doing

anything, and I don't believe that. I'm not suggesting that. I don't believe

that.

But

there's no other way I can see how that could work, unless you're going to

rearrange duties, or use more technology or something. Something has to change.

You can't do three times the work that you're doing now, assuming everybody is

going to work and doing their eight hours a day that they should be doing.

That's my only question about that, and I certainly look forward to hearing that

in Committee of the Whole.

Other

than that, as I said, it's a good bill. I support it 100 per cent. I'm glad that

the government are listening to municipalities on this one, it makes good sense

and I will support it.

Thank

you.

MR. SPEAKER:

If the hon. the Minister of

Municipal Affairs and Environment speaks now, he will close the debate.

The hon.

the Minister of Municipal Affairs and Environment.

MR. A. PARSONS:

Thank you, Mr. Speaker.

I thank

my colleagues on both sides for their contributions to this debate. I look

forward to the Committee stage. One question I'll answer now – and I might still

have questions during the Committee stage – is the question – and it's a good

question about – you're changing the cycle from three years to one year, and how

do you manage that.

What I

would say to that is I can only go by what they are telling me. The Municipal

Assessment Agency is telling us that they can do it with the resources that they

have. There are no new resources required, and there will be no new charges to

taxpayers. If we were dealing with that, this might be a different scenario if

we were imposing more cost on people. So that's what I take assurance from.

What I

would suggest is I have no problem reaching out to the Municipal Assessment

Agency and saying there are Members that have questions on this process, and

there's no reason that – they are an entity that is allowed to be questioned.

They can do a heck of a lot better job than I can of explaining their processes.

I mentioned the Member for Cape St. Francis said, too, about education and

assessments.

I can't

tell you, technically, how they're going to do this. I'm telling you it's a good

question. I'm telling you the assurance that I've been given, which is what I'm

relying on. I don't know if I would be supporting this if it meant new costs to

taxpayers. But they're saying that can do it, and there are no new costs, which

is why we're all supporting it. But I think it's worth – and, again, you can do

it directly if you'd like. You can reach out to them directly, or I could

arrange that through the department. Because it's not a bad idea to, perhaps, be

able to sit down and ask them these types of questions and other questions on

this process.

I'd say

to the Member, hopefully that satisfies – you won't get any different answer out

of me during the Committee stage. That's what I'm saying now, because it is

something that was brought up by multiple Members. On that note, there may be

other questions during the Committee stage that I will do my best to answer, and

we'll continue on.

Thank

you.

MR. SPEAKER:

Is the House ready for the

question?

The

motion is that Bill 34,

An Act To Amend The Assessment, 2006 be now read a

second time.

Is it

the pleasure of the House to adopt the motion?

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

MR. SPEAKER:

All those against, 'nay.'

Passed.

CLERK (Barnes):

A bill,

An Act To Amend The

Assessment Act, 2006. (Bill 34)

MR. SPEAKER:

The bill has now been read a

second time.

When

shall the bill be referred to a Committee of the Whole?

MR. A. PARSONS:

Now.

MR. SPEAKER:

Now.

motion, a bill, “An Act To Amend The Assessment Act, 2006,” read a second time,

ordered referred to a Committee of the Whole House presently, by leave. (Bill

34)

MR. SPEAKER:

The hon. the Government House

Leader.

MR. A. PARSONS:

Mr. Speaker, I move seconded

by the Member for Lab West that the House resolve itself into a Committee of

Whole to consider Bill 34.

MR. SPEAKER:

It is moved and seconded that

I shall now leave the Chair for the House to resolve itself into a Committee of

the Whole to consider this bill.

Is it

the pleasure of the House to adopt this motion?

All

those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

MR. SPEAKER:

All those against, 'nay.'

Carried.

I will

now leave the Chair.

motion, that the House resolve itself into a Committee of the Whole, the Speaker

left the Chair.

Committee of the

Whole

CHAIR (Warr):

Order, please!

We are

now considering Bill 34,

An Act To Amend The Assessment Act, 2006.

A bill,

“An Act To Amend The Assessment Act, 2006.” (Bill 34)

CLERK:

Clause 1

CHAIR:

Shall clause 1 carry?

The

Chair recognizes the hon. the Member for Cape St. Francis.

MR. K. PARSONS:

Thank you very much, Mr.

Chair.

I thank

the minister, too, because there are some questions that I know that we will

have to ask the municipal assessments to see where it's going to come from, but

I just want to know, in general terms, how many municipalities are involved in

the municipal agencies – do you know?

Like I

said, in my speech earlier, it was just a question I wanted to know because I

know that there are some towns that use poll tax and stuff like that and I'm

just wondering if you have that information.

CHAIR:

The hon. the Minister of

Municipal Affairs and Environment.

MR. A. PARSONS:

Thank you.

I'll try

my best to answer. I think right now in this province as a whole there are

currently 276 municipalities in total. My understanding is that four have opted

out of that and everybody else would be governed, I believe, by the Municipal

Assessment Agency.

CHAIR:

The hon. the Member for Cape

St. Francis.

MR. K. PARSONS:

Thank you very much, Mr.

Chair.

I have

an organizational chart of the Municipal Assessment Agency, and I understand the

number of assessors to do – how many there are right now. I know the minister

said that they told him and explained that it wouldn't be an extra cost or

whatever, but there isn't a cost to the municipalities for doing assessments.

So, obviously there will be an increase in assessors, because someone has to pay

for any additional assessments that are going to be done.

So I'm

just wondering, to do it one year over – now, I'm not saying – I know the Member

for Mount Pearl - Southlands said they mustn't be doing anything, but I know

they work very hard because I've been in a lot of times with them – so I'm just

wondering where the cost is going to come from to pay for the additional

assessments, and I can't see it being done without extra assessors to be able to

do the job.

And I

know, Minister, you told us that we could ask this to the assessment because

they assured you we could, but I just –

CHAIR:

The hon. the Minister of

Municipal Affairs and Environment.

MR. A. PARSONS:

It's a good question that the

Member asks.

The main

takeaway that I want to put out to people is there will be, we have been assured

– because this is a different scenario if we say we're going to change something

that brings extra cost to municipalities, we're having a different conversation

then. But I've been told there is no new cost to municipalities; no new cost to

taxpayers. They are assuring us that they can find a way to do this with the

resources that they have.

Now, the

technicalities behind that would be better answered by Sean and team at the

Municipal Assessment Agency. We've been at this a couple of years. This process

is not something that was just whipped up. They've been at this a couple of

years doing this review, and that's the assurance that we have, and we have to

move based on that assurance.

So, I

get what the Member's asking, I certainly do, it's a good point. But when I'm

given that assurance and I will rely on that assurance, they are saying they are

able to make this work and the good news is that we're not going to pay more for

that service.

CHAIR:

The hon. the Member for Cape

St. Francis.

MR. K. PARSONS:

Thank you very much, Mr.

Chair.

I want

to thank the minister, because I think that it would be great if some of us

could do a technical briefing with the Assessment Agency and I'd gladly be one

of the people that would love to be able to take advantage of that, because

there will be questions that I have to ask.

It's a

great bill. I agree with the amendments. I think it's something that the towns

are looking for. I believe that the residents are going to be pleased with it.

But, again, I understand if they can do it, it is fantastic, great, if there's

no extra cost or whatever.

I have a

question for the minister: I know it's changed now, say, if, for example, there

is a delay in the assessments, and now it's switched over for ministerial

approval, rather than I think before – and you can correct me, Minister, if I'm

wrong. I think before it had to go to the agency, to the manager or director to

get the delay on it.

Is there

a time frame that the towns will have to come in and say, listen, we're not

ready to send out the assessments, or how will the minister handle that role?

CHAIR:

The hon. the Minister of

Municipal Affairs and Environment.

MR. A. PARSONS:

Thank you, Mr. Chair.

Two

points. The first one I would say to the Member is that – and I would say this

to all Members, is that I will undertake, if Members are interested, that I will

help arrange or facilitate a meeting with MAA. I would suggest that Members'

interested should reach out to me directly and we can make that happen. Though,

obviously, it would have to be done together. We're not going to have separate

ones because they're going to need extra time now, obviously, doing all this

work in the cycle. But I will undertake to help facilitate that. I think that's

productive, and I would say that to Members on our own side.

The

second part, and I believe what we are doing here today, we've rolled it back to

August 31 for the compilation and you have to have that information there. The

first note I would make – so what we've done here is right now municipalities,

if they're late, they're late. We have no say. We want to have some

accountability there. If they are going to be late they have to get ministerial

approval. There's no timeline on that.

What I

will say is that the department has had really solid relationships with

municipalities, and that needs to continue. So this is not meant to be stringent

or onerous. I think it's an accountability measure. And communities in the past

have come in and expressed issues with this. The department is always willing to

have that conversation, and sometimes there might be good reason. There can be

issues that arise that nobody anticipates.

So I

think it's good for everybody, though. We need to have a timeline there. There

is a ministerial approval, and I don't think it would not be given or it would

be withheld for – what's the word I'm looking for – for non-necessary reasons. I

think this is one of those things where in terms of a timeline, municipalities

will have a good idea. To me, do you come in August 30 and say I'm not ready.

That's probably not the smartest move. I'd say it's one of those things – these

communities have an idea of how that's going to work, and it's incumbent on the

department to work with them as well because we all represent the same people.

We all want the same goal.

CHAIR:

The hon. the Member for

Ferryland.

MR. HUTCHINGS:

Thank you, Mr. Chair.

I just

want to go back to the issue of the cost and any new cost, just for clarity

purposes. Right now, my understanding is a municipality would pay the Municipal

Assessment Agency for when that assessment is done. What we're saying now is

that over a shorter period of time there's another assessment to be done. So I'm

confused.

Is the

municipality still required to pay for that assessment? Because the minister

said there's no new cost in this process, but if there's an additional

assessment done in a shorter period of time, someone needs to pay for that. I'm

just wondering, who is going to pay for that?

CHAIR:

The hon. the Minister of

Municipal Affairs and Environment.

MR. A. PARSONS:

Municipalities are already

paying on a yearly basis for this information. Even if the cycle is every three

years, they're already paying on a yearly basis. So they're getting – it's a

good question.

There's

no new cost there because they're already paying on an annual basis.

CHAIR:

The hon. the Member for St.

John's East - Quidi Vidi.

MS. MICHAEL:

Thank you very much, Mr.

Chair.

Minister, I'm asking – it's not in the act, but I think you won't mind answering

the question. I understand from the officials when we had the briefing that the

assessment criteria were not recommended for legislative amendments, and I think

I can understand that.

How are

you going to be dealing with the assessment criteria? Because I think it really

is an important point for people.

CHAIR:

The hon. the Minister of

Municipal Affairs and Environment.

MR. A. PARSONS:

Thank you.

I don't

mind discussing it to the best of my ability. It's not something in the act, but

it's something that was considered in this amendment. There were a bunch of

things considered.

It was

through assessment between MNL and the department and the MAA that this was not

something that would be touched in this particular amendment, but it's a

question that's worth asking. I still think there are a lot of questions on the

assessment criteria.

What I

can do is – and, again, I'm probably not the best person to speak. Put it this

way, when you had your briefing you were speaking to the smart people, and I

think they did their best to get this information to you.

What I

would say is I'm always willing to have that consideration. It was just felt, at

this particular time, that this might have opened a can of worms, perhaps, that

shouldn't be opened at this point. I think going forward there has to be more

education, conversation, and there's always the potential – these are pieces of

legislation that can always be amended if there's a positive or substantive

reason for it – not that they're not substantive here.

In some

cases by trying to fix something, are you creating a problem that didn't exist?

I know that's a bit of a roundabout way of talking about it. I also have some

information I can forward to you, that's been forwarded to me by staff, on

assessment criteria and what it's comprised of.

To me,

when we talk about the imposition of assessments on properties, it's one of

those things that it's ever green. It's always continuing. You always have to

have that talk. I don't think you can bring in this legislation and say: Oh,

it's perfect, we're not going to consider it. As long as we continue to have

assessments there are going to be questions on, how are you assessing me? What

are the criteria?

didn't decide to go with it now. I trust the consultations that took place

between all the individuals that I mentioned earlier, who said: Let's go with

these ones now, and then that one is better off not being touched at this

particular time.

CHAIR:

The hon. the Member for St.

John's East - Quidi Vidi.

MS. MICHAEL:

Thank you, Mr. Chair.

Mr.

Minister, I would appreciate receiving anything that you have on assessment.

MR. A. PARSONS:

Okay.

MS. MICHAEL:

Thank you.

CHAIR:

The hon. the Member for Mount

Pearl - Southlands.

MR. LANE:

Thank you, Mr. Chair.

Minister, just in the spirit of co-operation and full understanding of all the

information. As we know the process here now, we're in Committee of the Whole.

Then there's going to be a third reading, which in theory could happen tomorrow.

Given

the fact that we have some questions – I have a couple of questions which I've

raised, and other Members – of the Municipal Assessment Agency, and I guess

concerns about how they are going to achieve what you've been told they're going

to achieve without any tangible explanation as to how that's going to happen and

I guess concern that while they might theoretically say, yeah, we'll handle it

this year but then next year they're going to say we're going to have to charge

municipalities and so on – I don't have that information.

So in

the spirit of that, I'm just wondering, would you be able to commit here that –

because I certainly want to attend that briefing. Until that briefing happens,

if it's tomorrow or the next day I'll make myself available, I'm sure the

Members will – but we could have that discussion with the Municipal Assessment

Agency prior to us voting on third reading. Just in case – I'm sure it's not

going to change my vote because I support the legislation in general, but we do

have the ability to speak to third reading, albeit it may be unusual but we

certainly can. Prior to having that vote, I would just like to have the

opportunity to speak to the Municipal Assessment Agency about a couple of

questions.

I'm just

wondering if you could commit to not bringing forth third reading, leave it on

the Order Paper until we've had that little briefing.

CHAIR:

The hon. the Minister of

Municipal Affairs and Environment.

MR. A. PARSONS:

Mr. Chair, I appreciate the

comments from the Member. I'm not going to commit to it because I cannot

guarantee the timing on it and I need to get this done soon.

What I'm

going to say is this, I agree with the premise of what you're trying to do. I

prefer all Members feel comfortable in the votes they're casting, and I don't

think the meeting is going to change the vote, like you say. I tell you what,

how about you leave that with me. I'd like to try my best to accommodate that. I

got to work with MAA to see what their

schedule looks like, but you know what,

I'm certainly going to have a look at that.

I can't

commit to it because it's not me actually in the meeting, but just leave that

with me. I'm going to see if I can arrange something that would be beneficial

for Members.

CHAIR:

The hon. the Member for Cape

St. Francis.

MR. K. PARSONS:

Thank you very much.

Again,

I'd also like to be able to be involved in that meeting. Sure, if you can do

that it would be great.

I have a

question. Right now in the appeal process there's a fee involved of $25, and I'm

wondering if there are any talks of any changes or anything to the fee for

appeals. I know sometimes what will happen, people contact the agency, an

assessor will come down, have a look at the property, and there's no cost

involved. They just come down and the look at the cost of the property.

Minister, what I'm asking is there going to be any change in the – right now

they pay $25, and I could be wrong on that. I think it is $25 that you do pay

for an appeal. But sometimes what will happen if a town or anybody got some

interest, an assessor will down and probably have a look a general area and

stuff like that. I'm wondering if there are any changes in that at all.

CHAIR:

The hon. the Minister of

Municipal Affairs and Environment.

MR. A. PARSONS:

Good question.

Whenever

there's an increase in fees, it's something we should be concerned about. I have

no indication, none at all, that there's going to be any increase in fees.

That's the assurance that I've been given here because if it was the case, we'd

be having a different conversation. So, no increase that I'm aware of and that

would be the information I put out to the House.

CHAIR:

The hon. the Member for Cape

St. Francis.

MR. K. PARSONS:

Again, Mr. Chair, this is the

last question I'll ask the minister. Again, I assure him that I know that I'm in

favour of most of the things that are being done here and if there's no added

costs to the municipalities, I believe it's really good.

The last

thing I want to ask, Minister, I know there was a lot of consultations done with

MNL and different municipalities. People had the opportunity to go in – 61

people went into the consultations and gave their assessments of the Assessment

Act.

I'm just

wondering is there anywhere that the assessment agencies are going to have the

towns more involved in doing the assessments. Right now, they don't have hardly

any involvement at all. Sometimes, I know when it goes back the towns will look

at certain areas, the value and stuff like that. I'm not sure – will the towns

have more involvement in the actual assessments?

CHAIR:

The hon. the Minister of

Municipal Affairs and Environment.

MR. A. PARSONS:

I can't say for sure that the

towns will have more say, per se, in these assessments. I mean there are

specific criteria that's used. But, going back to your greater point, I don't

think it's a bad thing for municipalities to feel that they know more about the

process and understand the process.

definitely feel – amongst the populous – that there is a genuine lack of

understanding about the process and how this all happens which is why my

direction to staff, or my opinion to staff is that we can all – the department,

the agency – do more to educate people on how this assessment is created rather

than just have a piece of paper that shows up and says here's what you're valued

at, here's what you're going to pay.

That's a

tough pill to swallow for a lot of people. So, if we can do more to educate

people on that, I think it's better for everybody. Hopefully that answers it and

municipalities would then probably feel like they have more of a say. Now, at

the end of the day, the criteria are the criteria.

CHAIR:

The hon. the Member for

Ferryland.

MR. HUTCHINGS:

Thank you, Mr. Chair.

question for the minister on the special purpose properties: That reference has

now been removed from the act, so just to clarify, those properties that exist

or have been designated in the past as special purpose properties, will the

assessment for those now come from the agency or will it come from actual

municipalities?

CHAIR:

The hon. the Minister of Municipal Affairs and Environment.

MR. A. PARSONS:

What I'm going to do is I'm going to double-check again before we move on to any

third reading to make sure. My understanding is that would be done by, depending

on where the property is located – you're saying special purpose, so if it's in

the City of St. John's they handle the assessment of that, or depending on where

it is, it'd be handled by the Municipal Assessment Agency.

The big

thing is that we're moving to an actual assessed value rather than these

regulations which were – we've got to repeal them because we've dealt with court

challenges which didn't bode well.

CHAIR:

The hon. the Member for

Ferryland.

MR. HUTCHINGS:

And as well, if the minister

could check in regard to some of these properties would be under federal

jurisdiction, or would be held by federal agencies.

again, the method to find out all of these that were previously designated as

special purpose properties, because there are variations in jurisdictions, types

of properties. I guess the question is – and the minister's committed to find

the answer – What's the process for all of those properties, and is there any

exemption to any of those of who does them going