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5 NOV 2020

Global standards support first nations property assessment

Amie Silverwood

Amie Silverwood

Content Manager - Communications and Media

Toronto, Canada

RICS

Now in his fourth year on the Americas Board, Paul Campbell is a veteran leader for RICS in Canada. In his day job, he’s a leading property tax professional, specifically the Director of Valuation and Customer Relations in Ontario for the Municipal Property Assessment Corporation, a not-for-profit funded by Canada’s municipalities to provide objective asset valuation and expertise.

In fact, MPAC is the largest assessment provider in North America, delivering 5.4 million properties appraised every four years. Campbell knows that being entrusted by the public, especially at this scale, means continuously ensuring transparency and high professional standards to earn that trust. Nowhere is that truer than in his role as overseeing MPAC’s property assessments on some First Nation reserve lands in Ontario.

In Canada, pursuant to the Indian Act, title to reserve lands is held by the federal government. Thus, unlike properties located off reserves, no one can own a fee simple interest in reserve lands.

“There are particular challenges that require an up-to-date knowledge of First Nation laws, valuation best practices and the latest regulations,” says Campbell.

While no one can own the fee simple in reserve lands, property assessment and taxation on reserve lands generally assess and tax occupational interests as though they are held in fee simple off reserve. In this way, the property assessment and taxation systems on reserve lands follow the provincial approach to property assessment. Much of how a property is assessed is related to its value on the open market, but without that, assessors like Campbell need to rely on accurate property data and First Nation legislation.  

While First Nation members may be not be taxed, we do still need to assess interests in reserve lands in accordance with the specific First Nation assessment laws. Just as with municipal governments, how we determine value impacts First Nation taxpayers and First Nation revenue. We need to demonstrate we’re making sound decisions.

First Nations properties assessed by MPAC are largely single-family / cottage properties, and these can be leased to non-Indigenous people, including developers, who sign land leases (or ground leases, as they’re also called.) These enable First Nations and their members to derive income from the property while someone else with the building and management resources does the development and ground-up asset work. The tenant can be taxed based on the value of the property, which itself can’t be sold in fee simple.  This creates complex valuation challenges.

“This makes global standards even more crucial,” says Campbell. “We need to understand how different aspects of these laws function.

“But across it all, one major tool we have is data. Data that gives us the scope to make informed assessments of First Nations properties. We need to maintain high ethical standards with that data, and we take it seriously.”

Paul Campbell
Paul Campbell

As an RICS Fellow, I’m always aware that the built environment isn’t purely a business or bureaucratic exercise. The decisions we make as property and land professionals have impact on the way people live. RICS provides perspective on a range of issues and the challenges that run across different professions.

 

“In turn, I use my leadership role to impart that perspective to younger and newer RICS members. It’s a complex ecosystem and we focused on both the real value and the intangible value of land and property.”

Amie Silverwood

Amie Silverwood

Content Manager - Communications and Media

Toronto, Canada

RICS

Amie Silverwood is the Content Manager – Communications and Media for RICS in the Americas.

Read more from Amie