In fast-growing municipalities, a lag in assessing the values of properties can put a dent in city finances. For taxpayers, homeowners paying less than their fair share in property taxes can mean others pay more than they should to compensate.
These were the takeaways from Monday's revelation that the Ontario agency tasked with evaluating the worth of properties for tax purposes has been using out-of-date assessments, leading one homeowner in eight to pay too much or too little in taxes.
The findings were contained in a report by the auditor-general that also revealed that officials at the Municipal Property Assessment Corp. had used expense accounts to pay for meals, Wii game consoles and iPods.
Outdated property value assessments are a problem Milton, Ont., mayor Gord Krantz has been dealing with for years. The town west of Toronto, which pegs its population at 80,000, has experienced break-neck growth, and the MPAC rolls weren't keeping pace, he said, depriving city hall of revenue.
"I'm not just talking about chicken feed - it was into the tens of thousands of dollars," Mayor Krantz said.
The town has kept the pressure on MPAC and it has improved, he said, adding that he believed the problem was simply that the agency didn't have enough assessors to keep the property values current.
Pat Vanini, executive director of the Association of Municipalities of Ontario, said that, if faulty assessments by MPAC allow some homeowners to pay less tax than their properties are worth, the municipality can alter the tax rate to maintain the desired amount of revenue, which ultimately shifts the burden to others.
"At the end of the day, if someone doesn't pay, someone else does," she said.
Part of MPAC's trouble is trying to do evaluations in areas where not all properties are alike, such as in rural areas, said Terry Rees, executive director of the Federation of Ontario Cottagers' Associations.
"That's a challenge when you've got far-flung properties in the province," he said.