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By Altus Group | March 31, 2020

The Province of Alberta declared a state of emergency on March 17. According to Alberta’s Public Health Act, a state of public health emergency can be made for up to 30 days—but that can increase to 90 days in the event of a ‘pandemic influenza.’ This emergency declaration has resulted in some pending and proposed changes to appeal proceedings and taxation programs in Alberta.

Appeal proceedings may be delayed 

The Calgary and Edmonton assessment appeal deadlines were March 10, 2020. Where necessary, your appeals were filed prior to that date.  We are currently working with the Assessment Review Boards (ARB) to schedule your appeals to ensure the best opportunity for a successful result.  Indications are the Boards may delay the commencement of both the Calgary and Edmonton hearing seasons.  This will create an extended period before hearings that we plan on using for more negotiations with the City, hopefully delivering appropriate tax savings results without the risk associated with a Board hearing.  Our team is full steam ahead with City discussions and we are optimistic that this process will result in many settlements and deliver results that are both fair and equitable.

Most smaller Alberta municipalities are still in the Customer Review Period (CRP) and appeal deadlines are upcoming.  We will be in close touch with these clients with respect to appeal decisions and are equipped to launch any required appeals in a timely fashion.

Tax Deferral and Abatement Programs

There has been much discussion of property tax deferral and abatement programs in Cities across Canada. In Alberta, there is nothing conclusive with respect to the treatment of your 2020 Property Taxes.

Here is what we know right now:

  • The Alberta Government announced they will roll back a previously announced increase to the provincial portion of your 2020 property tax. This results in a 3.4% reduction to the provincial portion which comprises about 20% of your total tax bill. The net affect on the overall tax rate will be a less than 1% reduction from the tax rate we previously forecast
  • Alberta also announced a 6-month deferral with respect to the provincial portion of your commercial property taxes. Presently, it is unclear what this means for the Municipal portion of your taxes (80% of your tax bill)
  • The only abatement program we are aware of in Canada to date is in British Columbia where the province has announced that half of the provincial portion of the commercial property tax will be forgiven with no requirement to pay back

Most Canadian cities have formally announced deferral programs and we anticipate Calgary and Edmonton, as well as the smaller Alberta cities, towns and rural municipalities will follow suit. All three levels of our government are involved in building this program. The solution is complex because Cities are not permitted to run deficits, and this may explain the delay. We expect to hear details of a property tax deferral plan in the next 1 to 2 weeks. You can review our summary of programs being implemented across the country which will be updated on an ongoing basis.

2020 Assessment Requests for Information (ARFI)

You have either received your 2020 ARFI forms from your respective assessment department or you will soon. These are due to be returned to the City over the next 1 to 3 months, as stated on your form.  If there was ever a year that it is critical to accurately fill these out, it is this year. If you are in the process of providing rent abatement to your tenants or there is any other material change to the income performance of your property, you need to ensure you capture that on your 2020 ARFI. This will not influence your 2020 Assessment, as the base date for valuation is July 2019.  The current state of this market will, however, influence your 2021 Assessment and we need to start building our case for 2021 immediately by accurately completing these ARFIs.

How Altus Group is responding

Altus is doing everything possible to protect our clients interests and address tax concerns during this difficult time. We are engaged with industry organizations such as Realpac, NAIOP and the ICSC to advocate for measures such as tax deferral, abatement, or waiver. We will be continuing to work with local tax authorities and municipalities to resolve appeals and we are keeping apprised of any new tax deferral or abatement programs as they are introduced by municipalities. Our list of current programs in select major municipalities will be updated on an ongoing basis.

Please don’t hesitate to contact your consultant if you have concerns or questions.

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