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Tiny staying patient on determining what to tax aggregate companies

Staff opting for a wait-and-see approach to Wellington County appeals as advised by Simcoe municipal tax equity experts
An aerial view of the Teedon Pit at 40 Darby Rd. in Tiny Township.

Taxing aggregate companies properly in Tiny had residents quite interested at the start of the year, but they’ll have to wait a little longer to see what resolves in the matter.

At a recent committee of the whole meeting, Tiny staff presented an update on a potential tax increase to aggregate operations in Wellington County, and what effect that could have for municipalities across the province.

Last year, an Ontario court ruled that gravel pits in Wellington County were assessed too low by the Municipal Property Assessment Corporation (MPAC) and owed millions of dollars in backdated property taxes.

Director of finance/treasurer Haley Leblond referenced the initial OrilliaMatters letter from an Oro-Medonte resident to Tiny council back in January which began the exploration; it was speculated “that the value of the aggregate properties far exceeds $15,000/acre” for a 64 per cent increase in taxing aggregate operations.

“Since then, there’s been an appeal put forward by the property owner and MPAC,” stated Leblond.

“With regards to the pits within our municipality, MTE – which is the Municipal Tax Equity (Consultants Inc.) experts who work on behalf of Simcoe County – are closely watching this situation, and have recommended to Simcoe municipalities to just wait for the appeal to run through before determining the next steps.

“Staff are recommending that we take that action, and wait to see what happens with the appeal before we make any further decisions,” Leblond said.

The report to Tiny council explained that the Township of Tiny currently has nine properties classified and assessed as gravel pit/quarry/sand pits by MPAC. The include two aggregate wash water facilities: Teedon Pit owned by Dufferin Aggregates at 40 Darby Road, and Waverley Pit No. 2 owned by Sarjeant Company Ltd at 1379 Baseline Road South.

As a result of updated valuation and classification by MPAC, only active licensed pit areas are included in the industrial tax class, while inactive pit areas are assessed as residential or other. It was the updated methodology which shifted “significant” assessment value from industrial to residential tax class.

The Assessment Review Board (ARB) decision for Wellington County which resulted in the tax revenue increase raised concerns from other municipalities who have similar assessment values.

According to the MTE, as stated in the report, the Wellington County gravel pits were assessed “significantly higher” than Tiny due to the Wellington pits being “located in industrial areas close to major highways” as contrasted with the Tiny gravel pits “in rural areas where the property would normally be assessed and taxed as Residential or Farm class.”

“The industrial tax ratio for 2021 in the County of Simcoe is 1.1925 (2022 not yet established), which is less than half of the County of Wellington’s industrial tax ratio of 2.4000, which results in a much lower tax rate in Tiny and potential tax adjustment if the assessment values were to be changed,” stated the Tiny report.

A conclusion provided by staff stated that any potential tax adjustment for rural-located gravel pits in Tiny, if the assessment values were to be changed, would likely be minimal.

Given the options between the staff recommendation to follow MTE advice and wait for the ARB appeal in Wellington County, or to enact their own appeal which would be a complex process for an unknown positive or negative outcome, Tiny council carried a motion to safely wait and see.

Council further directed staff to reach out to MTE for a possible timeline when the appeal outcome could be anticipated.

The tax assessment review for aggregate companies report can be viewed within the agenda page located on the Tiny Township website.

Archives of council meetings are available to view on Tiny township’s YouTube channel.

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Derek Howard, Local Journalism Initiative Reporter

About the Author: Derek Howard, Local Journalism Initiative Reporter

Derek Howard covers Midland and Penetanguishene area civic issues under the Local Journalism Initiative, which is funded by the Government of Canada.
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