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John Tory vows to cap hikes in property assessments at 5%; But proposal would just shift tax burden to other people, Liberal finance minister says

Robert Benzie, Queen's Park Bureau Chief

March 10, 2007

A Progressive Conservative government would cap residential property assessment hikes to 5 per cent a year, party leader John Tory says.

With voters going to the polls in seven months, Tory has unveiled a key platform promise in his bid to unseat Premier Dalton McGuinty's Liberals.

"The property assessment system in Ontario has spiralled out of control and is hurting homeowners," Tory told reporters yesterday at a campaign-style event at the Leaside home of Gordon Cook, 80.

"In the Cooks' case, their property assessment has increased more than 37 per cent in the past three years and their property tax bill has gone up along with it. This kind of situation is far from unique."

Cook, who is not a member of any political party, said it is the type of issue that could swing his vote to Tory.

"I'll certainly give him the consideration," said the retired bureaucrat, who bought his house in 1961.

"We're going to have to work on you. That's a good answer, but not as good as it might have been," laughed Tory, who learned of Cook's plight from former area councillor Jane Pitfield.

Under the controversial market-value assessment system introduced by former Conservative premier Mike Harris, the arm's-length Municipal Property Assessment Corp. (MPAC) determines the value of a home for tax purposes.

According to MPAC, the average Toronto home's value increased by almost 12 per cent last year, translating into hefty tax increases for most property owners.

After an investigation by provincial ombudsman André Marin, McGuinty implemented a two-year freeze on assessments that will end next year.

"The McGuinty fake freeze ... is politics at its worst," charged Tory, warning homeowners should expect to be walloped if the Liberals are re-elected on Oct. 10.

Along with a 5 per cent cap on assessment increases – as long as an individual owns their home – and no limit on assessment decreases, a Conservative government would launch a reverse onus appeal system forcing MPAC to justify any changes.

But Finance Minister Greg Sorbara said Tory's numbers don't add up.

"When you cap one person's taxes you shift that tax burden to other people whose assessments are stable or have in fact gone down," said Sorbara.

"It doesn't average out. You shift the burden from Rosedale to Rexdale," he said.

Asked what the Liberals planned to do once the freeze is lifted, Sorbara said: "We may well address these matters in the (March 22) budget. I don't know. I haven't finished the budget yet."

Enid Slack, director of the Institute on Municipal Finance and Government at the University of Toronto, said Tory's proposal is "appealing, but it's not fair."

"The good thing is that it provides stability for people in their homes, particularly for seniors," said Slack, noting it doesn't take long for inequity to creep into the system.

"You'll get stability and predictability for the taxpayer at the expense of equity."

Association of Municipalities of Ontario president Doug Reycraft also expressed doubts about the capping scheme.

"Our experience has shown that whenever you put a cap in place you shift the tax burden from one class of taxpayer to another," said Reycraft.

But Bob Topp, of the Coalition After Property Tax Reform (CAPTR), an umbrella group for 700 ratepayers' and seniors' associations that claims to represent hundreds of thousands of homeowners, hailed Tory's plan and predicted it will jolt the Liberals.

"This is going to wake them up a bit," said Topp, praising MPP Tim Hudak (Erie-Lincoln) for championing the issue in the Tory caucus.

"To see this in the Conservative platform is a huge step forward for our constituents.

"Mr. Tory is demonstrating a real understanding of the underlying inequity in a system which bases property taxes on a rough estimate of market worth, taxes unrealized gains in value and leaves the property owner with no control over tax levels from year to year."

With files from John Spears

Source: http://www.thestar.com/article/190355

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