Ottawa co-ops feeling pinch of property tax assessments
Residential co-operatives and other non-profit housing organizations in Ottawa say sky-high municipal assessments are jeopardizing their ability to provide affordable housing.
The Municipal Property Assessment Corporation has recently mailed out assessments for 2012 and in some cases multi-residential assessments doubled and even tripled over the last four years.
Housing organizations that try to provide affordable living say the assessment process is squeezing them out.
Representatives at the 83-unit Blue Heron co-op on March Road said MPAC valued the apartments and townhouses at just over $7 million four years ago and now said they are worth nearly $20 million.
No special consideration for co-ops
Residents there volunteer four hours a month in exchange for rents slightly below average but the co-op's co-ordinator, Michelle Bainbridge, said the latest assessment makes that model unsustainable.
"So that means we could be looking at 150, 160-thousand dollars a year in property taxes? There's no way. We would have to close the co-op down," said Bainbridge.
MPAC's formula gives no special consideration to co-ops and other non-profits, according to Glen Lucas, president of Property Tax Review Services.
The Blue Heron co-op is asking MPAC for special consideration nonetheless and the co-op may also appeal the assessment.
Condo owners can't sell at assessed value
The Centretown Citizens Ottawa Corporation, which owns 50 properties and sells units at affordable rates, has also seen its rates go up 120 to 130 per cent in the last four years, according to executive director Raymond Sullivan.
Sullivan said the higher rates have undermined his group's ownership model.
Nine years ago, the group put in place an ownership pilot where residents bought their condos at below market price, if their income qualified them, and in return they signed an agreement that restricts the resale value of the condo to an inflation index, instead of full market value.
"Despite that, MPAC insists on making their property assessment based on the full market value of the condo," said Sullivan. "Now there's no legal way that they could sell that condo at full market value, but they still have to pay tax on it as if they could."
Sullivan said his group worked with the affected homeowners to appeal the assessments, but they lost.