The prospect of moving to an “income approach” for tax assessment in North Battleford was the hot topic at City Hall on Monday.
Representatives from the Saskatchewan Assessment Management Agency were on hand to provide council members sitting as the Planning Committee council with information and to answer questions.
Presently, the assessment model used by North Battleford is a cost-based approach for commercial properties. There have been calls by the Battlefords Chamber of Commerce supporting a move to the income approach, and the issue has been raised at council on and off in recent years.
Chandra Reilly, regional manager for SAMA, explained the income approach to valuation is “essentially based on the rental income that a building or land can produce.” It has nothing to do with personal income or expenses, she said. It is strictly what that building can produce for revenue for that property owner.
SAMA officials described it as simply another tool in the appraisal toolbox to assess value of a property. They explained the approach is used for income-producing commercial properties such as hotels and apartment buildings.
Cities such as Moose Jaw, Weyburn, Estevan, Yorkton and Swift Current currently use the income approach. Monday’s discussion revolved around the possibility of whether the income approach could be applied to North Battleford properties for the 2021 assessment revaluation year.
The main stumbling block is getting the necessary financial information and data back from businesses. SAMA indicated a significant response would be required from property owners before it could be applied.
Some preliminary efforts are under way. The plan is for SAMA to do some data collection and to send mailouts to property owners at the end of July.
Reilly said they would start with multifamily properties and hotels/motels. They expect some response there, but whether SAMA goes further depends on the amount of data they get back.
