Hans Karow Coalition to Reduce Electropollution (CORE) M2 /C14 1215 Poplar Grove Road PENTICTON, BC, V2A 8T6 E-mail: [email protected]Mr. Robert J. Pellatt Commission Secretary B.C. Utilities Commission 900 Howe Street, Box 250 Vancouver, BC V6Z 2N3 February 16, 2006 Dear Mr. Pellatt, Re: FortisBC Inc. Order No. G-114-05 / Project No. 3698407CPCN Application for Nk’Mip Substation & Osoyoos Transmission Line http://www.bcuc.com/ApplicationView.aspx?ApplicationId=93 1. Please accept this and the attachment as my Evidence # 38 ; another follow-up with regards of property devaluation issue. 2. Attachments consist of a. Atchison Affidavit in the BCTC VITR & SeaBreeze VIC hearing; Mr. Atchison is a professional engineer and real estate advisor b. Newman Affidavit in the BCTC VITR & SeaBreeze VIC hearing; Mrs. Newman is a Senior Appraiser at the BC Assessment Authority 3. In those affidavits it is clearly stated that power lines are associated with diminution in property values [yellow high lighted by Karow]: a. 20% for properties under power lines b. 10% for properties adjacent to power lines 4. Above facts are in contrast to Lands West property Services report, dated December 15, 2005 (Wonch White IR#1, Q6/A6, Appendix A6), where Mr. Ron Pavlakovic comments: - “…that there is negligible impact to property value associated with these types of facilities [13kV and 60kV transmission system, …Karow] in proximity to residential properties.” - “Both US and Canadian studies involving the effects of high voltage transmission lines on residential developments have indicated that the impact to value is negligible, if any C1-75
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C1-75...PENTICTON, BC, V2A 8T6 E-mail: [email protected] Mr. Robert J. Pellatt Commission Secretary B.C. Utilities Commission 900 Howe Street, Box 250 Vancouver, BC V6Z 2N3 February 16,
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Hans Karow Coalition to Reduce Electropollution (CORE) M2 /C14 1215 Poplar Grove Road PENTICTON, BC, V2A 8T6 E-mail: [email protected] Mr. Robert J. Pellatt Commission Secretary B.C. Utilities Commission 900 Howe Street, Box 250 Vancouver, BC V6Z 2N3 February 16, 2006 Dear Mr. Pellatt, Re: FortisBC Inc. Order No. G-114-05 / Project No. 3698407CPCN Application for Nk’Mip Substation & Osoyoos Transmission Line http://www.bcuc.com/ApplicationView.aspx?ApplicationId=93 1. Please accept this and the attachment as my Evidence # 38; another follow-up with regards of
property devaluation issue. 2. Attachments consist of
a. Atchison Affidavit in the BCTC VITR & SeaBreeze VIC hearing;
Mr. Atchison is a professional engineer and real estate advisor
b. Newman Affidavit in the BCTC VITR & SeaBreeze VIC hearing; Mrs. Newman is a Senior Appraiser at the BC Assessment Authority
3. In those affidavits it is clearly stated that power lines are associated with diminution in property values [yellow high lighted by Karow]:
a. 20% for properties under power lines b. 10% for properties adjacent to power lines
4. Above facts are in contrast to Lands West property Services report, dated December 15, 2005
(Wonch White IR#1, Q6/A6, Appendix A6), where Mr. Ron Pavlakovic comments: - “…that there is negligible impact to property value associated with these types of
facilities [13kV and 60kV transmission system, …Karow] in proximity to residential properties.”
- “Both US and Canadian studies involving the effects of high voltage transmission lines on residential developments have indicated that the impact to value is negligible, if any
- “…there is no impact to the property building envelopes, no diminution in value is estimated as a result of the rebuild of the existing structures on the abutting residential properties.
- There are generally no property value impacts to residential, commercial or industrial properties that are adjacent to distribution/transmission facilities…”
Respectfully submitted, Hans Karow [copy of this e-mail will also be forwarded to Mr. Ron Pavlakovic, Lands West Poperty Services Inc., Westbank, BC. [email protected] ]
Manual Adjustment - Traffic -5% -1 5% -1 0% Characteristic Adjustment - Power Line Proximity -1 5% -20% -5%
Not Affected by Traffic: Tsawwassen Heights, etc. Manual Adjustment - Traffic * 0% 0% Characteristic Adjustment - Power Line Proximity -1 0% -20%
for ADJACENT PROPERTIES Manual Adjustment - Traffic 0% 0% 0% Characteristic Adjustment - Power Line Proximity 0 to-10% -10% -5Oh
Notes: 1. No property specific adjustments for existing transmission line poles 2. Traffic adjustment by property In 2005 ranged from -3% to -1 0%, and averaged -5%. 3. Power Line Proximity adjustment by property in 2005 ranged from 0 to -lo%,
1 1. Finally, Ms. Newrnan explained that, for example, the 2006 Assessed Value of a property
represents the value of that property as of July 1,2005, based upon its physical condition on
October 31,2005.
12. In my view, the announcement of the BCTC project in late 2005 is the only factor which
reasonably accounts for the relatively large increase in effect of power hues on assessed land
value, as between the 2005 and 2006 Assessment Rolls.
13. Further, in my experience, the assessed value of a property as calculated by BCA;l is a
reasonable proxy for the property's market value at the time of assessment. In its "factsheet"
titled "Frequent4 A~ked cQriestiotz~--260ut Pmpet?.y A.~se~'smend' BCAA states that "An assessment is
Atchison Affidavit #2
titled "Fnquenth Asked Q~estions A bout Propeq Asses~ment' BCAA states that "An assessment is
the determination of a property's market value.. ." and "Market value for assessment purposes
in British Columbia is the most probable price that an unencumbered property would sell for on
the open market.. ." This factsheet is attached to my affidavit as Exhibit A.
Estimated Incremental Loss in Property Value
14. In order to find a reasonable estimate of the total loss in the market value of properties on and
adjacent to the Right of Way caused by the BCTC's proposed project, I calculated the Total
Estimated Incremental Loss in Assessed Value of those properties as a result of the increase in
the power line adjustment applied by BCAA.
15. '13e Total Estimated Incremental Loss in Assessed Value, due to the changes in the power line
adjustment, is a reasonable estimate of the loss in market value caused by BCTC's proposed
project because, as noted above, (i) assessed value is a reasonable proxy for market value, and (4 the announcement of the BCTC project in hte 2005 is the only hctor which reasonably
accounts for the changes in the power line adjustment between the 2005 and 2006 Assessment
Rolls.
16. I obtained the assessed values for properties on and adjacent to the Right of Way from the 2004,
2005 and 2006 Assessment Rolls, provided to me by the BCTC.
17. I performed the following calculations, a detailed summary of which are attached to my affidavit
and labelled Exhibit B. First, I determined the Estimated Incremental Loss due to power line
adjustment for each property:
a) 2006 Dimensioned Value = 2006 Assessed Value-Land 1 - (2006 Power line Adjustment + 2006 Traffic Adjustment)
b) Estimated Incremental Loss = 2006 Dimensioned Value x (2005 Power line Adjustment - 2006 Power line Adjustment)
18. I then calculated the Total Estimated Incremental Loss due to power line adjustment by to tahg
the Estimated Incremental I,oss for each property, both on and adjacent to the Qht of Way.
Atchison Affidavit #2
19. The following table summarizes my findings for total Estimated Incremental I,oss due to power
33. In summary, in 2006, the Corporation of Delta wiU lose an estimated $37,533 in property tax -
revenue as a result of BCTC's proposed project. 'Taken over perpetuity, the Corporation of
Delta may lose an estimated $790,170 in property tax revenue should the project continue as
planned.
SWORN BEFORE ME at the City of ( / G - L - - ~ W ~ ~ ,intheprovince
)
of ' 3 - C . )
,this= day of )
h Commis in and for the P r o ~ h c e o f a C . )
Lawyer 1 6@4001 West h g i a
Vanmuver, B.C.V6B 591 (604 632-9Qfl
W h a t is BC Assessment? What Is %he relationship between property BC Assessment is a provincial Crown corporation that classifies and assesses the value of all real property in British Columbia. On December 31, BC Assessment sends property owners a Property Assessment Notice telling them the fair market value of their property as of July 1 of that year.
What is an assessment?
An assessment is the determination of a property's market value, property classification and applicable exemptions as of July 1 each year. On December 31, BC Assessment mails a Property Assessment Notice to each property owner in the province, showing the property's market value. This assessment is the basis used by taxing authorities for determining the share of municipal and provincial property taxes owners will Pay.
iYha& is market value?
Market value for assessment purposes in British
assessment and taxes? Provincial and municipal governments (taxing authorities) pay for public services through property taxes, which are based on assessed value. BC Assessment determines the market value of properties and sends property owners a Property Assessment Notice. Then, tax authorities determine the property tax rate they will set to ralse the revenue needed to pay for public services. The tax authorities apply this rate to the assessed value of properties and send property owners a Tax Notice.
Why did the value uf my property chah-sge? Property values usually change as a result of real estate market forces and these forces vary by property type and location. I f a property was upgraded, the value will likely increase.
What hzpgens if I disagree ~ d i % h my property 's assessed vaiue?' - -
Columbia is the most probable price that an Property owners who disagree with the estimate of unencumbered property would sell for on the open market on July 1, if a reasonable amount of time is their property's market value, exemption status, or
allowed to find a purchaser. who believe their property was improperly classified, should contact their local assessment office.
BC Assessment has a professional appraisal staff and an extensive database that is periodically updated with information gathered through appraisal inspections. Municipal and provincial agencies inform BC Assessment of land title changes, building permit approvals and zoning adjustments. BC Assessment also considers a property's unique characteristics, including location, size, layout, shape, age, finish, quality, carports, garages, sundecks and condttion of buildings. All these variables are considered when valuing each property.
BC Assessment wilt review the assessment and, if a change or correction is required, will recommend the changes to a Property Assessment Review Panel (PARP) on behalf of the owner. I f the property owner still disagrees with the assessment, he or she may request an independent review before a PARP. This request must be delivered In writing to BC Assessment no later than 12:OO a.m. P.S.T. on January 31.
This is Exhibit.h.,referred to in the Affidavil of .!!k.d...&k~!?!..%?a .... Sworn before me at the City of
/.?,%.ZA,:,P,:.L.Z... BC, this.k:.'day
updated 07.2005 Disclaimer: Where information presented is different from legislation, legislation shall prevail. for ~ r i t ~ l ~ s ~ s s m e n t . c a
* , I * ggwal is the FA5gP?
The PARP is made up of three people appointed annually by the provincial government. The impartial panel hears evidence and will determine if a property has been valued or classified correctly, or if exemptions were properly applied.
PARPs are independent of BC Assessment and the tax authorities. Neither the PARP or BC Assessment has jurisdiction or control over taxes or tax rates. Property taxes cannot be appealed.
A r e any tax ~e i le f programs avai#a$lc? The provincial government makes the Home Owner Grant available to most residential property owners who occupy their property.
The provincial government also provides tax deferral support. People 60 years of age and older, widows, widowers and disabled people (as defined in the Guaranteed Available Income for Need Act) may defer their property taxes until they sell their property.
For more information on tax deferment, contact the municipal or government agent office in your area or visit www.qov.bc.ca. See also the Fact Sheet on Section 19(8) o f the Assessment Act: Assessment Relief.
updated 07.2005 Disclaimer: Where information presented is different from legislation, legislatlon shall prevail. www.bcassessment.ca
ATTACHMENT 1 - SUMMARY OF BCAA ASSESSMENT ANALYSIS OF ROW 8 ADJACENT PROPERTIES
ROW Properties Land $ 33,966,000 $ 38,530,000 $ % no6 nnn t rrr nn7 I + naz nnn~ Buildings
Total
Adjacent Properties Land Buildings
Total
Combined Land Buildings
Total
YEAR-TO-YEAR CHANGES (%) ROW Properties
Land Buildings
Total
Adjacent Properties Land Buildings
Total
Combined Land Buildings
Total
NOTES: A, Based upon aPPlYlng 2005 BCAA characteristic a0justments forland.to.2006 aimposinpnd. Vatu
TRAHVOL Page I of 2 February 2006
b
AlTACHMENT 1 - SUMMARY OF BCAA ASSESSMENT ANALYSIS OF ROW 8 ADJACENT PROPERTIES B. 2006 mill rate based upon 2005 mill rate plus 2.5% increase for 2006 (source: 2005 property tax notice from Corporalion of Delta) C. Current 30-year market rate of BC Municipal Finance Authority on February 13,2006 = 4.75% D. 2005 Corporation of Delta mill rate for single family residential properly in Tsawwassen (source: 2005 property lax notice) E. Estimated 2006 Corporation of Delta mill rate for single family residential property in Tsawwassen (source: TRAHVOL)
~ u n i c i ~ a l General Municipal Debt Regional Library Drainage South Delta Rec Centre
Other School Residential BCAA GVRD GV Transoortation Authoritv ~unic i~a l '~ inance ~uthorit;
Total 2005-2006 %increase (source: Corporation of Delta) 3.50%
TRAHVOL Page 2 of 2 February 2006
This is ~ x h i b i t ..G.referred to in the Affidavit of .h!c~,i..A:t~,fi:~s.s~... Slvorn bcfore me at the City of
4-1 Bc-- *vfi*k.k~k.<... Bc, this ..!6 .... day - s NEWS RELEASE
For Immediate Release January 3,2006
ASSESSMENT NOTICES SENT TO PROPERTY OWNERS IN DELTA
DELTA - More than 35,000 property owners in Delta can expect to receive their 2006 assessment notice in the coming days.
Assessments are the estimate of a property's market value as of July 1,2005. This common valuation date ensures that all properties are assessed fairly and there is an equitable base for property taxation.
The real estate market creates property value, which is reported annually by BC Assessment. Local governments and other taxing authorities are responsible for property taxation, and after determiming their own budget needs this spring, will determine their property tax rates based on BC Assessment's data. Note: Property owners should contact their local government, or taxing authority, for more information about their property taxes.
"Most homes on this year's assessment roll are worth more than they were on the 2005 assessment roll, and market movement appears strong when compared to previous years," said Richmond Area Assessor Mark Katz.
Changes in property assessments are reflective of movement in the local real estate market and can vary greatly from property to property. When estimating a property's market value, a professional appraiser analyzes current sales in the area, as well as considering other characteristics such as size, age, quality, condition, view and location.
Overall, Delta's assessment roll increased from $14.48 billion last year to $16.03 billion this year. A total of $172 million of this growth reflects non market changes which includes subdivisions, rezoning and new construction.
The examples below demonstrate local market trends for properties by a geographic area; trends are affected by many variables.
Assessments in Delta 2005 Assessment Valuation Date July 1,
2004
2006 Assessment Valuation Date July 1,
2005 Tsawwassen
Beach Grove, Single Family, older Central, Single Family, older ViewIWaterfiont, Single Family Strata Apartment, 2 bedroom, low rise
$339,000 $365,000
$1,395,000 $181,000
$406,000 $4 19,000
$1,622,000 $21 9,000
Ladner Single Family, older Single Family, newer Strata Apartment, 2 bedroom, low rise Townhouse, 3 bedroom, older
$355,000 $479,000 $187,000 $198,000
$389,000 $548,000 $2 16,000 $21 1,000
"Property owners who feel that their property assessment does not reflect market value as of July 1, 2005, or see incorrect information on their notice, should contact the BC Assessment office indicated on their notice as soon as possible in January," said Katz.
3
North Delta
"If a property owner is still concerned about their assessment after speaking to one of our staff, they may submit a written request by January 3 1, for an independent review by a Property Assessment Review Panel." The panels, independent of BC Assessment, are appointed annually by the Ministry of Small Business and Revenue, and meet between February 1, and March 15 to hear formal complaints.
Single Family, older Single Family, newer Strata Apartment, I bedroom, low rise Townhouse, 3 bedroom, older
Assessments and Sales by Address are available for residential property owners to hrther assist them in understanding their property's market value and to provide comparable sales information. This service is available on BC Assessment's web site at ww~~.bcassessment.ca from January 3 to March 15. Paper copies of Assessments by Address are also available at local area offices and most municipal halls, libraries and govemment agent's offices across the province. Sales by Address is new for this year, market value sales that occurred three months before and three months following the July 1,2005 valuation date, between April 1 to September 30,2005 are included.
Delta is served by both of our South Fraser offices; South Delta, Annacis and Tilbury properties are valued by the Richmond/Delta Assessment Office which is located at Suite 200 - 11331 Coppersmith Way. North Delta properties are valued by the Surrey/White Rock office which is located at Unit 208, 5460 - 152 Street, Surrey. During the month of January, office hours are 8:30 a.m. to 5:00 p.m. Monday to Friday.
$302,000 $546,000 $59,000 $184,000
- END -
$323,000 $573,000 $73,000 $205,000
For More Information: Mark Katz Area Assessor BC Assessment South Fraser Region
Major Induslrial: excludes eligible portproperties that are subject to a municipsl tax rate cap of $27.50.
Debt SunGod
Ref Regional Library GVRD BCA GVTA LAD Rec MFA
ND /ANN SD Rec Rec
Total Municipal
In the Matter of the Utilities Commission Act R.S.B.C. 1996, c. 473
Re: British Columbia Transmission Corporation ("BCTC") Project No. 3698395/0rder No. G-70-05
Certificate of Public Convenience and Necessity ("CPCN") Application - Vancouver Island Transmission Reinforcement Project
I, Marcia Newman, Senior Appraiser, of 200 - 11331 Coppersmith Way, fichmond, British Columbia, MAICE OATH AND SAY AS FOLLOWS:
1. I work as a Senior Appraiser at the British Columbia Assessment Authority (the "BCAA"),
on the residential team for fichrnond and Delta. As such, I have personal knowledge of the
facts and matters to whch I depose, except when such knowledge is stated to be on
information and belief, in which case I do verily believe the information to be true.
2. I have worked as an Appraiser with the BCAA for almost 15 years. I have worked in the
capacity of Senior Appraiser for approximately 2 years.
3. In general, the BCAA applies a (downward) adjustment factor to properties whch are under
or adjacent to power h e s , to reflect an associated decrease in market value.
4. Historically, the BCAA has applied an adjustment factor of 10% to the properties on the
right of way in Tsawwassen in whch there are currently two h g h voltage power h e s (the
"RIght of Way"). The power h e s run dtrectly over these properties.
5. During 2005, BCAA was aware of the proposal by the British Columbia Transmission
Corporation (the "BCTCy') to add new, hgher voltage h e s to the fight of Way. In light of
the publicity, controversy and uncertainty associated with h s proposal, it was incumbent on
the BCAA to ensure that the adjustments associated with these power h e s reflected the
current market realities in Tsawwassen as of July 1,2005, the valuation date for the 2006
property assessments.
6. I conducted the analysis necessary to determine the accuracy of the adjustment factor. I
began by plotting all of the properties on or adjacent to the RIght of Way on a large map,
includmg the existing adjustment factors for each property.
Affidavit of Marcia Newman
7. In order to isolate the effect of the power h e s from other factors whch effect market value
(such as traffic), I performed a "paired sales analysis" whch compares the recent s e h g
price of properties whch are under the power h e s , to s d a r properbes in the imrnelate
area whch are not under or adjacent to the power h e s .
8. I compared the s e h g price of 6 pairs of properties, whch were sold on the following dates:
On the fight of Way t o No ~ o w e r h e s July 2005 May 2005 July 2005 August 2005 March 2004 February 2005 January 2004 February 2005 May 2004 June 2005 May 2004 February 2005
9. T h s comparison inlcated a downward adjustment factor ranging from 7% to 23%.
10. Based upon the relative sdar i t ies of the various pairs of properties, I concluded that 20%
was a reasonable estimate of the impact, as of July 1,2005, in assessed value associated with
being located on the fight of Way, underneath the power h e s .
11. I also conducted a paired sales analysis for properties adjacent to the power h e s . By
adjacent, I am referring to properties whch have a power h e very close to the property h e .
12. I analyzed sales prices for 3 pairings of s d a r properties in the imrnelate area. In each
pairing, one property was adjacent to the power lmes, whde the other was not. The sale
dates for the properties whch I compared were as follows:
Adiacent to the h e s t o No ~ o w e r h e s July 2005 January 2004 February 2004 August 2005 July 2005 August 2005
13. Based on &IS analysis, I concluded that a downward adjustment of 10% is a reasonable
adjustment factor to reflect the decrease in property value as of July 1,2005 caused by being
adjacent to the power h e s on the fight of Way.
3 Affidavit of Marcia Newman
14. Finally, I also had to consider the possible effect of traffic. In addtion to being adjacent to
or under the power h e s , certain properties on 53A Street are also adjacent to a considerable
amount of traffic, whch can influence market value. Based on an addtional analysis for
traffic, I concluded that properties on 53A Street must receive an addtional downward
adjustment of 159'0, as a result of the effect of traffic.
15. I also conducted an "assessment to sales ratio" test (the "ASR) to check the accuracy and
equity of the new adjustment factors. In general, the closer the ASR is to 1, the more
accurate and equitable the assessment.
16. For all assessments to whch the new adjustment factors applied, the ASR ranged from 92%
to 96%. T h s suggests that the new adjustment factors provide a reasonable and fair
estimate of property value.
17. In summary, I concluded that, in order to more accurately reflect market value, a 20'7'0
downward adjustment must be applied to the land value for the properties under the power
h e s on the hgh t of Way, and a 10% downward adjustment must be applied to the land
value for the properties adjacent to the power h e s .
18. These updated adjustment factors have been applied to the most recent assessment (2006)
of property values in Tsawwassen.
) SWORN BEFORE ME at
. f f OF a~&r& )
fld&/~/'~AL,~P'<~B~&* ) in the ~ r iv ince of Bgftsh Columbia, t h ~ s /o& )