Osoyoos homeowners, like everyone else in B.C., should have received their assessment notices earlier this month.
The assessment of their property in most cases should reflect the market value of their property, as determined by BC Assessment.
They look at sales of similar properties in the area and other factors to try to arrive at a fair market value.
Fairness is important.
Assessments are used to establish the taxes that property owners will pay for a wide range of local services ranging from education to hospitals to rural or municipal services.
But, in the case of some rural residents, the system isn’t fair.
Some residents of Area A in the Regional District of Okanagan-Similkameen (RDOS) are getting reductions on their assessments that are intended for farmers, even though their property isn’t farmed.
Mark Pendergraft, the RDOS director who represents Area A, points out that it’s a relatively small number of rural residents who are receiving these benefits, but he says it’s unfair nonetheless.
Pendergraft over the years has raised concerns about this with the provincial government, but he says the province has been unwilling to make changes.
Critics of the present system usually recognize that there is a public benefit to keeping agricultural land for farming.
This is the rationale for the Agricultural Land Reserve (ALR), which was established in the early 1970s by the Dave Barrett NDP government.
It’s also the reason why farmland is assessed based on its agricultural value rather than on what the property would fetch on the open market.
The problem occurs, however, when property owners with little or no connection to agriculture receive assessment discounts for land that isn’t actively farmed.
In September, Metro Vancouver released an excellent report on the much worse situation in the Lower Mainland. The report notes, however, that its arguments could also apply to other areas of B.C.
Flawed provincial policies, it points out, are actually encouraging farmland to be used for non-farming purposes.
And they’re unfair.
“When farm property tax policy inadvertently creates financial tax advantages for non-farm residential and commercial uses in the ALR, questions of equity among taxpayers emerge,” says the Vancouver report. “Reforming farm property tax policies may or may not increase total taxes collected by municipal governments, however it will redistribute the tax burden more equitably.”
Certainly there are abuses in the Lower Mainland that go far beyond what is seen in the Osoyoos area.
The Globe and Mail cites the example of a 23,000 sq. ft. mega-mansion with roman columns being built on farmland outside Vancouver.
Some 122 Vancouver-area agricultural properties that sold in the year prior to last July fetched a total of $449 million, even though they were only assessed at $52 million.
This kind of abuse is not occurring around Osoyoos. And it’s quite likely that residents here don’t set out to cheat – they just aren’t about to complain about a system that works to their benefit.
But town residents and indeed most residents of Area A are paying enough in local taxes.
When a minority is perceived as getting a free ride at the expense of the majority, it undermines confidence in the system.
The provincial government must make a priority of fixing this.
