The Assessment Process
Property assessment in Alberta is the basis for property taxation, which is the major source of revenue generated from within the municipality.
Assessment is the process of valuing property for the purpose of fairly and equitably distributing a municipality’s total property tax among property owners. This process establishes the value of a property in relation to similar properties and does not in itself generate property taxes. Property taxes are generated when the Provincial school & Municipal tax rates are multiplied by the assessed value of your property. The municipal tax rate is also known as the municipal mill rate.
Assessment is governed by the Municipal Government Act of the Province of Alberta and associated regulations. The Town of Wembley contracts the services of the County of Grande Prairie No. 1 Assessment Department and has appointed Jessica Donovan as the town’s assessor. Assessments for all property in a municipality, other than linear property, must be prepared by the assessor appointed by the municipality.
In the preparations of the assessment, the Municipal Government Act and associated regulations define two types of property:
Regulated – These properties are valued according to rates published by Alberta Municipal Affairs for the express purpose of assessment and include properties such as farmland, railway, machinery & equipment and linear (i.e. pipelines, electric power, transmission lines, telecommunications equipment).
Non-Regulated – These properties are valued based on their estimated market value, and include residential, commercial, and industrial properties (i.e. residences, acreages, farm residences, warehouses, gas stations, restaurants, etc.)
In accordance with the MGA & Regulations, each year the Assessor must determine an estimate of "market value” as of July 1 of the assessment year.
Alberta Municipal Affairs audits each municipality’s assessment each year to ensure that it is complete, accurate, and meets the quality standards set out in the MGA, Regulations, and Minister’s Guidelines. Assessment Auditors examine the Assessor’s required data submission and report back to the municipality upon completion.
FREQUENTLY ASKED QUESTIONS
What is Market Value?
Market value is the most probable price that a property would sell for on the open market as of a given date.
For assessment purposes an assessor reviews and measures the real estate market on July 01 of the previous year in which a tax is imposed with consideration to the physical attributes and condition of your property as of December 31 of the previous year.
The MGA defines market value in Section 1(1) of the MGA as follows:
(n) "market value” means the amount that a property, as defined in section 284(1)(r), might be expected to realize if it is sold on the open market by a willing seller to a willing buyer;
This definition would make the following assumptions:
- sufficient exposure time in the market
- neither buyer or seller are under any undue pressure
- both buyer or seller are well informed
- payment for the property is typical for the market
What does an Assessor need to know about my Property to prepare the Assessment?
In order to prepare an estimate of value the Assessor needs to know about the physical characteristics and condition of each property.
Information typically gathered on a property includes the type, size, age, and characteristics (e.g. heating type, plumbing fixtures, interior finish) of improvements, and the "property class" based use of the improvement/property (e.g. residential, farm, commercial, industrial/manufacturing – a property may have be dual purpose, residential & industrial), etc. Data collection may be in the form of a physical inspection, in-person or phone interview, or using electronic data available through photos, land titles, etc. Your assessment is only as accurate as the information provided to, or gathered by the Assessor when requested.
If you've recently purchased the property the Assessor may also ask for information about the sale to determine if it can be used as an indication of typical market conditions. This may include asking: What the use of the property was at the time of sale? Was it serviced? Was it purchased from a family member or an inheritance? Was there any personal property (e.g. appliances) included? Have there been any changes to the property since the sale?
What gives the assessor the right/permission to enter onto private property?
The Municipal Government Act states in Part 9 Division section 294 (1),(2),(3)
294(1) After giving reasonable notice to the owner or occupier of any property, an assessor may at any reasonable time, for the purpose of preparing an assessment of the property or determining if the property is to be assessed,
(a) enter on and inspect the property,
(b) request anything to be produced to assist the assessor in preparing the assessment or determining if the property is to be assessed, and
(c) make copies of anything necessary to the inspection.
(2) When carrying out duties under subsection (1), an assessor must produce identification on request.
(3) An assessor must, in accordance with the regulations, inform the owner or occupier of any property of the purpose for which information is being collected under this section and section 295.
Does a property owner have to answer questions or provide information on their property?
The MGA says it best in Part 9 Division 1 Section 295
295(1) A person must provide, on request by the assessor, any information necessary for the assessor to prepare an assessment or determine if property is to be assessed.
(4) No person may make a complaint in the year following the assessment year under section 460 or, in the case of linear property, under section 492(1) about an assessment if the person has failed to provide the information requested under subsection (1) within 60 days from the date of the request.
Why do assessors value property on a yearly basis?
The Municipal Government Act requires that all property in Alberta be assessed each year. Annual assessments ensure that changes in market value are captured regularly, protecting tax payers from large market-driven assessment changes.
My home was partially built upon receiving my tax/assessment notice?
The Assessment/Tax Notices are generally mailed out in May. The assessment value on your notice will be reflective of the physical condition and level of completion as of December 31 prior to the year in which you receive your notice.
If a home was partially complete as of that date, the assessment will include a value for the land, site improvements, value added for the services plus a value for the building based on the stage of completion.
If I have a portable or movable structure, will I be assessed and taxed for it?
The simple answer is Yes. If the structure is less than 12'x16' an assessment would not be prepared. Portable or movable structures such as frame and fabric buildings, sheds, relocatable offices, relocatable metal oilfield buildings, mobile homes, cabins, sea cans etc… will be and are assessed at the value they would add to the property.
These portable buildings are defined in the Municipal Government Act as structures and is defined as:
Part 9, Section 284
1(u) "structure” means a building or other thing erected or placed in, on, over or under land, whether or not it is so affixed to the land as to become transferred without special mention by a transfer or sale of the land.
How do I know my value is reasonable?
The assessor compares the property sales of similar buildings and characteristics to your property. Remember, the assessed value is as of July 1 of the previous year in which a tax is imposed.
Do you accept appraisal forms to determine a correct assessment for my property?
An appraisal, similar to an assessed value, is an opinion of value as of a specific date in time. We generally would not substitute a single appraisal value as the market value of your property, but would take a serious look at any appraisal supplied to us as information.
The appraisal is a site-specific value based on a small sample (typically three or four) of the most similar properties sold. Mass appraisal, as legislated by the Province of Alberta, looks at a type of property and analyzes a large sampling of sales with similar characteristics. An appraisal may provide us
What happens if my property had a fire during the year?
A Property assessment is determined based on the physical condition of the property as of December 31, prior to the year in which the tax is imposed. If the fire damage was present on or before the December 31st date, the assessment/tax notice will reflect the impact on the value due to the fire.
If the fire damage occurred in the same year in which you receive your assessment/tax notice, your assessment will not take into account fire damage or repairs until the following tax year. Please don't hesitate to contact the assessor with this information when changes occur.
How does the Assessor calculate my Assessment?
In appraisal and assessment theory, there are three approaches to values when valuing real property.
- The Sales Comparison Approach – evaluations are based on the actual sale prices of other properties that have sold. This approach is most appropriate when the sales of similar properties are plentiful and reflect the typical market conditions. Of the three approaches it is the most easily understood by the public and courts.
- The Cost Approach – based on the premise that a property's value is set by the "cost” of replacing an equally desirable substitute within a reasonable time frame. This approach works best for newer improvements where depreciation is less of a factor and special purpose properties which do not tend to sell on a regular basis. It's important to note that cost and value are NOT necessarily the same: cost is the amount required to produce the item, whereas value is related to how desirable the item is to a potential owner.
- The Income Approach – based on the premise that a property's value is related to its ability to produce an income. This approach works best for properties that are typically rental type properties (i.e. apartment buildings, warehouses, etc).
In Alberta, Non-regulated properties are valued according to the Market Value standard set out in the MGA and Regulations. The Assessor utilizes both the Cost Approach and the Sales Comparison Approach in evaluating these properties for assessment. We would call this the modified cost approach. Assessments are prepared by applying cost and sales data to the specific details of your property held by the Assessor. Regulated properties such as Farm land and Machinery & Equipment are valued using the appropriate procedures, tables and rates set out by the Provincial Government in Legislation relating to each property class and type of property. The assessor will obtain and utilize information from a number of sources to help establish the assessed values. For example, the assessor would obtain all sales from land titles on an annual basis, MLS information, Income data on specialized properties, professional opinions from appraisers and developers, information from home owners, and data collected on inspection and from the Town Planning department.
How can I contact my Assessor?
Your Assessor is available Monday through Friday 8:30am – 4:30pm at the County of Grande Prairie No. 1 office located at:
10001 – 84 Avenue
Clairmont, Alberta
T0H 0W0
Phone: 780-513- 3952
You may wish to phone ahead and confirm that the Assessor will be in the office.
What if I disagree with my assessment? What if I think my property is assessed for more/less than they could have sold it for?
When you receive your Assessment Notice, ask yourself "What would my home have sold for on July 1 of the previous year?” If the answer is close to the value of your assessment, then your assessment is fair. If not, please give the County of Grande Prairie No. 1 Assessment Department a call to review it with you.
Upon review, make sure the details and description of the property is accurate. Discuss any problems that might affect your property's value. The Assessor may ask to re-inspect your property and correct the information if necessary. It is very important to remember that the assessment is based on a value as of July 1st of the year prior to which you have received your assessment/tax notice.
If your assessment is in error, it can be corrected during the appeal time frame outlined on your assessment notice.
Once you have talked to an assessor, if you are still not satisfied that the assessed value is fair or the information on your property is correct, you may file a written complaint to the Clerk of the Assessment Review Board. If you wish to file a complaint with the clerk of the assessment review board, you have 60 days from the date your assessment or tax notice was sent. An assessment complaint must be filed using the Government of Alberta "Assessment Review Board Complaint Form”. This form is available at the Town of Wembley Municipal Office or you may also download from it from the Municipal Affairs website.
The complaint form asks for specific information about the property and the reasons for the complaint. You need to explain why the information is incorrect (e.g. the square footage on your property record is wrong), what the correct information should be, and what the requested assessed value is. You may also be required to pay a fee to file the complaint with the assessment review board this information can be found on the back of you assessment or tax notice. If someone will be acting on your behalf regarding your complaint you will also need to fill out an "Agent Authorization Form” (number LGS1405). This form is also available at the Saddle Hills County building or you may also download it from the Municipal Affairs website.
This form will verify that you, the assessed person, authorize the party to act on your behalf in regards to the complaint submitted to the assessment review board. You will be asked for specific information about your property and the person representing you.
For further information regarding the assessment appeal process, visit the Municipal Affairs website.
Acknowledgement:
This information would not have been possible without the kind assistance from the Assessment
Department of County of Grande Prairie No. 1 and the MD of Saddle Hills.
