Feature Article February 19, 2004
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Campground owners ask questions, but does MPAC have the answers?
At a public meeting held in Cloyne last Friday morning, February 13, campground owners expressed frustration and anger over retroactive tax bills they have already, or will receive for the value of seasonal trailers parked on their land.
"New
trailer assessment rules were designed with expensive trailers in
mind, but they are having a great impact on smaller campgrounds in
poorer parts of the province."
One campground in North Frontenac received a bill in excess of $5,000 and a Central Frontenac campground received a $7,500 bill.
The meeting was chaired by former Mayor of North Frontenac Stan Johnston, and was attended by representatives from the Ontario Ministry of Municipal Affairs, who did not speak but did take notes. Stan Johnston said he was disappointed that despite every effort to accommodate her schedule, neither MPP Leona Dombrowsky nor anyone from her office was in attendance at the meeting. (see Dombrowsky explains)
Lyndon Johnston, a municipal relations representative with the Municipal Property Assessment Corporation (MPAC), made a general presentation about MPAC and then Peter Morian, the customer service manager of the Kingston MPAC office discussed the practice of assessing seasonal trailers. Morian said a moratorium has been in place in assessing these units since 1990, but this moratorium was never reflected in legislation.
As the result of a legal case in southwestern Ontario, what Morian referred to as the Bluewater decision, MPAC has been visiting seasonal trailer campgrounds in 2002 and 2003 and assessing the value of the trailers, add-a-rooms, and carports.
Morian also reported that, under legislation, properties that have not been taxed can be charged with up to three years of back taxes, but a Ministry of Finance directive from October 31, 2003, said only year 2003, will be used for what we call the omitted assessments of trailers.
John Buchanan, who owns a small campground near Cloyne, asked the MPAC officials how they justify assessing someone for something they dont own. How can you assess something without notifying the owner of the property, he asked.
Campground owners are being expected to pay the extra assessment, which averages about $400 per newly assessed property in the case of Woodcrest Resort. Arnold Colton recounted that 15 of the 70 trailers in his resort had been assessed, and of the 15, five of them have decided not to return to the resort this summer. In his case, he had sold the trailers to those people, so he will now be trying to re-sell those trailers instead of selling new ones, and will have to seek about $800 extra in rental on those sites to pay the omitted assessment from 2003 and the new assessment for 2004.
Put this way, he said, We are looking at a 30% increase in site fees to pay for this, and normally we are lucky to get a 5 or 6% cost of living increase each year. That 30% represents a 6-year increase in one year, and my customers cant swallow it.
There was much discussion at the public meeting about the rules by which MPAC is determining which trailers are indeed assessable. Stuart Gray, a campground owner who attended the meeting as a representative of the Ontario Private Campground Association, said later that one of the scariest things is that MPAC has been mandated to do a job, and it has no idea how to do this job. The figures they have come up with are just off the wall. Gray argues that the rate of depreciation of trailers set by MPAC is way too low because trailers depreciate at a tremendous rate each year. He noted cases where identical trailers have been assigned vastly different values.
A letter from the Ministry of Finance which was forwarded to John Buchanan from Leona Dombrowskys office, said that trailers will be assessed if they are wider than 86 or if they meet three of five criteria: 1. The trailers have permanent connections for water, electrical and waste disposal; 2. They require an oversized permit for road travel; 3. They are equipped with a structure such as a deck, carport garage or a sunroom; 4. Tow gear has been removed; 5. They are placed on concrete blocks, a concrete pad or other foundation.
As many as 100 municipalities throughout the province declined to levy the omitted assessments for trailers for 2003. They cited section 365 of the Assessment Act, which allows them to decline to levy taxation if it will cost undue hardship on the ratepayer. North Frontenac did not do this at the time, opting instead to levy the tax and then waive any penalties for non-payment until August of 2004. The entire North Frontenac Council and Mayor Maguire were in attendance at the Cloyne meeting, and expressed support for the campground owners. A meeting is being scheduled between campground owners and municipal officials to look into what, if any, avenues are open to them to alleviate this burdensome taxation situation.
Stuart Gray said the OPCA has proposed a tag fee for trailers, which could be administered municipally and would raise funds directly for municipalities. We first proposed something like this in 1988, and it was accepted by the government of the day. However, they lost power before it was approved. We also proposed something like this in the early 90s and have sent a proposal to the Ministry of Finance, but we have not been able to arrange a meeting with Ministry of Finance Officials. We have no way of knowing whether they are considering the proposal.
The OPCA has been trying to work behind the scenes on this problem for several months. Until recently they were reluctant to speak publicly about the issue, but last week they released their public relations firm and are now prepared to bring their knowledge about this situation to public forums like the one in Cloyne last week.
Stuart Gray said The trailer assessment practice was set up to deal with situations that exist in the Niagara region and in Southwestern Ontario. Operations like mine in Eganville, and the campgrounds in North Frontenac and Addington Highlands are going to have a hard time dealing with this and some will be put out of business by it.
The numbers of private campgrounds are decreasing, while Provincial Parks and Conservation Areas are increasing. It makes you wonder if the government wants to turn campgrounds into a provincial government industry.
Provincial campgrounds will not be affected by the new assessment rules.
