Halifax wins Citadel Hill dispute with feds

Halifax Regional Municipality has won its dispute with the federal government over the value of the historic Citadel Hill site.

18-year tax battle over historic site reached the Supreme Court of Canada

The Supreme Court of Canada says the federal government must come up with a reasonable value for Citadel Hill. (CBC)

Halifax Regional Municipality has won its 18-year dispute with the federal government over the value of the historic Citadel Hill site.

Ottawa put the value of 47 of the 48 acres (19.02 of 19.4 hectares) on the hill at just $10 because the land could not be developed and had no commercial value.

Halifax Regional Municipality said it was worth as much as $19 million.

Now, the Supreme Court of Canada has sent the matter back to the federal cabinet minister responsible to come up with a more reasonable value for the property.

Dan Campbell is the Halifax lawyer who argued the city's case before the Supreme Court, said the ruling comes down to a matter of principle.

"How do you assess a national historic site? Which, of course, cannot be used for any other purpose," Campbell said. "You can't put condos on it. You can't subdivide it. It's used only as a park."

The ruling has implications across the country.

Cities across the country were watching this decision closely because it could have determined what the federal government would pay for lands like the Plains of Abraham in Quebec City.

The federal government does not pay municipal taxes. Instead, it pays grants in lieu of property taxes. They're based on the value of property. 

Halifax Regional Municipality estimates the difference is worth half a million dollars every year. That is on top of a retro-active amount of about $7 million, going back to the beginning of the dispute.

But Mayor Peter Kelly said it's too early to decide how to spend the money.

"Let's make sure we get it in our hands," Kelly said. "So don't count the chickens before they hatch.  Let's see what that cheque's going to be and let's have that discussion."

Quebec City recognized the significance of this decision and intervened at the hearing.