Legislative Assembly of Ontario

The House resumed at 8 o’clock, p.m.

Mr. Chairman: The member for Essex-Kent.

Mr. R. F. Ruston (Essex-Kent): Yes, I would like to take this opportunity, Mr. Chairman, to introduce 40 grade 8 students from Maplewood Public School in Essex, with Mr. Rennie in charge. Welcome them, please.

Mr. Chairman: The hon. Minister of Transportation and Communications.

Hon. J. R. Rhodes (Minister of Transportation and Communications): Thank you, Mr. Chairman. I would like to introduce to you, and through you to the members of the Legislature, 28 grade 8 students from Kiwedin Public School. They are accompanied by Mr. Toyne and also by chaperons. They are seated in the west gallery and I would appreciate the Legislature’s welcoming them here.

Mr. Chairman: The hon. House leader.

Hon. E. A. Winkler (Chairman, Management Board of Cabinet): Mr. Chairman, I have the great pleasure this evening, in the absence of the Provincial Secretary for Resources Development (Mr. Grossman), because of his confinement to hospital, of introducing to you, and through you to the House, a very distinguished representative group of the Toronto Men’s Regional Council of B’nai B’rith.

Mr. Chairman: When we rose at 6 o’clock we were discussing Bill 87. The hon. minister.

ASSESSMENT ACT (CONCLUDED)

Hon. A. K. Meen (Minister of Revenue): Yes, Mr. Chairman, when we rose at 6 the member for Ottawa Centre (Mr. Cassidy) had asked me for perhaps somewhat greater elaboration on the intent of section 7 of the amending bill, and I indicated that I would endeavour to give him some further detail when we reconvened at 8 o’clock.

Under this section, as the amendment stands, the tenant is entitled to a notice of the assessment, so that if any error is created in that assessment, as to the way in which he may be designated for school support or whatever, he gets an opportunity to appeal and certainly he gets notice of it.

Furthermore, as the years go on it would appear that more and more tenancies, not just commercial and industrial tenancies but also a good many apartment tenancies, contain tax escalation clauses based on earlier years. Until now, and as the Act presently stands -- but this would be remedied by this amendment -- all tenants, whether they are commercial or industrial, get their notices now for purposes of industrial assessment -- or business assessment, I suppose I should say -- but also all tenants of conventional residential accommodation would receive these notices of assessment, which would give the valuation upon which there might be some tax escalation applicable.

This will, therefore, give them the opportunity to file notice of an appeal. In the case of a landlord who has as years go on less and less interest in the taxes, where he has tax escalation clauses built into his leases it becomes more and more nearly imperative that there be provision for the tenants to have an opportunity to appeal these notices, since they are the ones who are in the long run going to pay the money. That’s really a long answer to a very short question and to an even shorter amendment in section 7.

Mr. J. A. Renwick (Riverdale): As usual, my colleague, the member for Ottawa Centre, makes a very good point. What the minister very cutely has described as an opportunity for the tenant is, in fact, the imposition upon the tenant of a legal liability to pay the tax.

Hon. Mr. Meen: No, sir, the tax isn’t assessed against the tenant. It is still assessed against the landlord.

Mr. Renwick: If I may just read the section to the minister in case he hasn’t had an opportunity to do so himself, it says: “The land shall be assessed against the owner thereof and against the tenant to the extent of the assessed value.”

I would suggest to the minister --

Hon. Mr. Meen: The land is, but not the tax.

Mr. Renwick: -- disguised in that innocuous way, what you are going to do without any correlative protection for the tenant is to assess the tax against the tenant, which means it’s collectable from the tenant where it is now not collectable. I am simply saying at least level with us about what you are doing.

Hon. Mr. Meen: I have made my position completely and absolutely clear, Mr. Chairman.

Mr. Chairman: Shall section 7 stand as part of the bill?

Mr. M. Cassidy (Ottawa Centre): Mr. Chairman, I want to comment a bit more on section 7. The member for Riverdale is absolutely right. I think the point that should be made here is, if the government wanted to ensure that tenants did become liable for tax, the government might find that this party was in agreement with that, as long as there was a protection for the tenant. There is no such protection in the legislation as it is drafted right here.

The kind of situation that the door is open to here is one where the tax will be passed on to the tenant but the rent will not be adjusted accordingly. Clearly if we were to move to a situation where tenants were to pay tax directly rather than to pay it indirectly in the form of rent, they should be guaranteed that their rent is reduced according to the amount of tax that they have to pay, rather than being hit doubly both by the rent and by the tax.

Were that to be done and were the protections to be contained, I think it would be a very useful reform. I would just like to commend that to the government, if the Treasurer (Mr. White) is listening, since the Minister of Revenue simply carries out orders for the Treasurer. Tell us you don’t. We would be interested to hear that. Presumably you are just carrying orders from the Treasurer, one hopes that he or his people are listening.

Mr. R. Gisborn (Hamilton East): He is a good listener.

Mr. Cassidy: It mightn’t be a bad reform, now that half of the people in Metro Toronto and approaching half of the people in regional Ottawa are tenants, for taxes to be paid by the tenant directly rather than by the landlord. I think the minister may possibly be aware of the games that landlords have played over the last four or five years, when they raise their rents and justify the increases on the grounds that the taxes had increased, when in many cases the taxes had either been reduced or had not changed at all. It would avoid that kind of game playing. It would also mean that there was more direct involvement by voters at the municipal level with the government for which they pay a very major share of the costs. Right now they are insulated from that because what they see is a rent increase and they blame the landlord for that, and rightly in many cases, even if it happens that it’s a municipal tax increase and not a landlord’s ripoff --

If people are going to get involved, then it seems to me that one way of helping them to get involved is to have them see that they pay the taxes directly. Right now the limit of their involvement is a certification as to whether they are on the Catholic or public school roll. I am suggesting, Mr. Chairman, in other words, if you can turn around the normal order of words, that there should be no representation at the municipal level without taxation and that we should consider seriously whether those taxes shouldn’t be paid directly rather than indirectly by tenants.

Mr. Renwick: Mr. Chairman, if I may. I assume the proposition that we have asserted is correct, that you are, in fact, imposing a legal liability for the first time on the tenant for the payment of the tax. I would share the views of my colleague, the member for Ottawa Centre, that there may well be in a realistic tax system the responsibility on the government to impose the taxes on persons who, in fact, do pay them.

As a matter of fact, it raises an interesting constitutional question as to whether or not without this, the direct taxation is such that it can be collected, in any event, from a tenant, because it would be indirect taxation. But leave aside the constitutional issue, which of course we can argue in the court at the same time that we argue the questions related to the deductibility in respect to the land tax.

Leaving that aside, does the minister really seriously consider that the total assessment levied against the owner of a multiple dwelling accommodation, and apportioned on the basis laid out in this bill, will give the tenant an adequate appeal? Because his remarks indicated quite clearly that this was his rationale, that now the tenant could appeal the taxes levied upon him.

If you are the tenant in an apartment building against whom is assessed a proportionate amount of the taxes for the whole building, does the minister seriously believe that an appeal by a single tenant against that assessment is ever going to be effective without both the co-operation and the compulsion on the owner to provide all of the information to the tenant on the basis of which the tenant could appeal?

Does the minister really think, for example, that a tenant in St. James Town, allocated a proportion of -- what? How many units are there in St. James Town? The Minister of Housing (Mr. Handleman) is sitting right beside him, and he adores that St. James Town complex, the highest density complex in Canada, along Wellesley at Parliament St. Whatever the number of units is -- 5,000 or 6,000 -- does the minister really think that a proportionate part of the total assessment of the St. James Town property allocated to a tenant, against which the tenant can appeal to an assessment review board and then to a county court judge, is going to result in the alteration by one iota of the tax which that tenant pays? Does the minister nod his head affirmatively and think it will change it?

Hon. Mr. Meen: Give me an opportunity to reply.

Mr. Renwick: All right.

Hon. Mr. Meen: Thank you. That member mixes a couple of things together the way the member for Riverdale does, and whether I shake or nod my head I am in trouble.

Mr. D. C. MacDonald (York South): You are in trouble no matter what way you --

Hon. Mr. Winkler: The same as the member is.

Hon. Mr. Meen: No, the tax is assessed against the land, and consequently against the owner. It is not against the tenant. The tenant merely has an assessment for the purpose of getting on the roll so he has the opportunity to appeal, and all the other things that go along with the rights under the Act. But the point here is that he does have that right to appeal, and if he is being grossly over-assessed, and that would be the only reason for his appealing, then I’m sure there would be an appropriate adjustment in the value of the fair market rental.

Mr. Renwick: How naive can the minister get?

Mr. Cassidy: Very.

Mr. J. R. Breithaupt (Kitchener): How naive do you want him to be?

Mr. Renwick: Let me try to express to the minister what is wrong with the assessment of apartment buildings by way of municipal taxes in the province. Apartment dwellers pay a higher proportion of taxes than do people in other residential accommodations, as compared with commercial assessment.

Is the minister trying to say to me that he can argue the total assessment of that apartment building because he’s assessed an allocable part of that? Because if he does, then he and I must part company, because he is being specious.

The second part of it is the very real point. That is that the moment you say a person is assessed under a taxing statute means that person is legally liable for the payment of the tax, and the mere specious right of appeal does not protect him against that legal liability.

At least at the present time, the tenant cannot be sued for arrears of taxes but you know as well as I do that would now be possible once this particular section of the bill -- the minister shakes his head. What other meaning does “assessed” have? His own explanatory notes indicate quite clearly -- section 7 makes it clear that land is no longer to be assessed only against the owner but rather against the owner and against the tenant; not against them jointly but severally. However, the tenant will be assessed only for the portion of the land he occupies. He has neither the information nor the opportunity to have any real appeal.

Always the minister faces us at this point in the evening with a question of principle and I guess we will have no alternative but to divide, even though it is very early in the evening, on this particular issue. You cannot assess every tenant in Metropolitan Toronto and elsewhere in the metropolitan areas of the province without some thorough understanding of what you are doing.

Mr. Cassidy: That’s right.

Mr. Renwick: If you are going to give him the right of appeal, you have to give him access to the information upon which he can base his appeal.

Mr. Cassidy: That’s right.

Mr. Renwick: Otherwise it’s specious; let’s not kid anybody about this. I am afraid, Mr. Chairman, we are going to have to divide and I am afraid we won’t be able to agree to a stacking of the vote assuming as always, of course, that we have five members in the House.

Mr. Chairman: Shall section 7 stand as part of the bill?

Mr. Cassidy: Mr. Chairman, I want to point out something else as well and that is the way it is done right now is a half-measure. As the member for Riverdale says it may well be that tenants are becoming liable for a tax in which they have very little rights whatsoever.

Can the minister say to the House what would happen if a tenant were to appeal successfully an assessment, which he gets for the first time according to this, and has the assessment on his apartment or his rental unit reduced by 10 per cent or 20 per cent? What rights has the tenant to enforce a rebate or a refund of the tax, which is no longer payable, from his landlord if, as the minister claims, the tax is a charge on the owner and not on the tenant?

The second point is this; as the minister well knows, there has been an habitual and traditional discrimination against apartments in the assessment practices in many municipalities. Nepean is one; I am sure Toronto and North York and other municipalities in Metro Toronto carry on the same practice as well. The Smith committee found that in certain cases apartments were assessed at three times the rate of single-family homes.

What policy is the minister going to follow? What policy are the courts going to follow if tenants, as they should, go to the assessment appeal board and say, “It isn’t fair that this apartment is assessed at $5,000 when the rent is $190 a month and a house down the street, which has a rental value of $380 a month or a market value of $50,000, is also assessed at $5,000.” When tenants seek equity, what is the policy of the government going to be? What policy is it handing down to the appeal board or the review board --

Mr. R. Haggerty (Welland South): Far too low -- $5,000.

Mr. Cassidy: -- and what is going to happen there? If you are going to do nothing, this is a completely useless kind of thing which is going to lead to total frustration and people will experience in practice the inconsistencies and incoherencies of the government’s policy of freezing assessment for two more years.

Hon. Mr. Meen: I don’t think there will be a frustration of the policies, Mr. Chairman.

The tenant who makes application before the board and is successful in having his assessment of fair market rent reduced is thereby going to reduce the total fair market rent of the apartment complex; or the reduction might occur because of other increases around him. One way or the other the tenant, as an individual, I would venture to say, would have the same chance of success in any such appeal as any owner of a home would have in appealing his assessment with respect to any of the other assessments around him.

Mr. Renwick: That is totally incorrect and specious and the minister knows it.

Hon. Mr. Meen: If there is a rebate, of course, it is not the form of a rebate per se I would say through you, Mr. Chairman, to the member for Ottawa Centre. This is at the assessment stage before the actual tax has been imposed and it would simply reduce the amount of the assessment upon which the owner would eventually be taxed and, of course, flowing in the reverse direction after payment of tax than the amount which, if anything, there is a reflection back to the tenant of the amount which he would be expected to pay.

Mr. Cassidy: How would it come back? How would he get it back?

Hon. Mr. Meen: He won’t have paid it in the first place. It would be a subsequent statement from the landlord of the amount of tax the landlord had paid in the year 1975, let us say. The tenant’s portion of that would be based on his percentage of the fair market rental of his suite with respect to the total fair market rental.

Mr. Cassidy: If there is no escalation clause in the lease, how does the tenant get it back? I can see that happening if there is an escalation clause in the lease.

Hon. Mr. Meen: On that basis the tenant has no right to get it back. It is the case where the tenant has a provision in his lease whereby he pays, in addition to X dollars a month for basic rental, an amount with respect to any increase of taxes over a base year. That’s what I am talking about with tax escalation clauses in leases.

Mr. Cassidy: Can we not talk about the majority of tenants, Mr. Chairman, who don’t have a tax escalation clause, and who simply are locked into a lease of a year, or two years, or three years, and who, if they succeed in getting the assessment of their unit reduced, or the assessment on their class of units reduced, have to watch while the landlord jets off to Florida to enjoy the proceeds of their efforts on his behalf?

Hon. Mr. Meen: In cases like that, of course, it is of primary interest to the landlord to get the taxes reduced to the minimum. I was talking of cases where more and more apartment leases contain tax escalation clauses.

Mr. Renwick: Listen, the minister knows as well as I do there is every conceivable variation of the lease with respect to the mutual obligations of the landlord and the tenant respecting taxes. How can the minister come into this Legislature and introduce a bill which is going to impose a legal liability on the tenant to pay the taxes, when the landlord in a particular form of lease has the obligation to pay the taxes and the taxes are included in the rent?

What are you trying to do? Are you suggesting in that situation that --

Mr. Cassidy: He is fishing, that’s what he is doing.

Mr. Renwick: -- you should impose the legal liability to pay the tax on the tenant, even though he is under no legal liability to his landlord to pay that tax at all and the landlord is obligated?

The other side of the coin is, as the member for Ottawa Centre says, there are clauses in leases in which the tenant is obligated to pay the taxes and there is an escalation clause. Are you going to suggest for one moment that the landlord should have the benefit of the effort of the tenant to reduce the taxes in that particular accommodation, without requiring that the rent be reduced proportionately to the reduction the tenant has obtained?

There are many variations on it. And, as usual when this government thinks about the tenants, they think about them as some strange motley crew out there --

Mr. Cassidy: That’s right.

Mr. Renwick: -- that don’t have any rights.

Mr. Cassidy: It is an anti-tenant government.

Mr. Renwick: It is about time the law of landlord and tenant came back into this assembly to be looked at. We got rid of some of the feudal incidents, but we are certainly not going to allow some kind of feudal incident to be reimposed on the tenant here without correlative protections.

The minister knows very well that he can’t get away from the fact that the assessment of this tax against the tenant imposes a legal liability that never before in the Province of Ontario existed with respect to the tenant. The minister is getting irritable again. That means he has been caught out again on another tax bill that he has been given the responsibility for bringing through this House.

Mr. Chairman: Shall section 7 stand as part of the bill?

Mr. Renwick: No.

Mr. Cassidy: No.

Mr. Chairman: Those in favour of section 7 standing as part of the bill will please say “aye.”

Those opposed will please say “nay.” In my opinion the ayes have it.

Shall we stack this?

Mr. Renwick: No, ring the bell.

Mr. Chairman: Call in the members.

The committee divided on the question of whether section 7 shall stand as part of the bill, which was approved on the following vote:

Clerk of the House: Mr. Chairman, the “ayes” are 43, the “nays” are 33.

Section 7 agreed to.

Mr. Chairman: Any further comments, questions or amendments on any later section of the bill and, if so, which section?

The member for Riverdale, on which section?

Mr. Renwick: Section 8.

An hon. member: Carried.

Mr. Renwick: I don’t know. I wil just read the bill.

Mr. R. F. Nixon (Leader of the Opposition): Just get the significance of the marginal notes.

Mr. Renwick: I would like to ask the minister a question. My remarks are directed to section 11, Mr. Chairman.

Mr. Chairman: Anything before section 11?

Sections 8, 9 and 10 agreed to.

Mr. Chairman: The member for Riverdale on section 11.

Mr. Renwick: Mr. Chairman, throughout the bill -- I should not say throughout every section of the bill -- is the principle enunciated in section 11 that the assessment of lands is to be based upon the lands in the immediate vicinity and not on the average value of lands in the whole municipality. The term “lands in the immediate vicinity” is used in a number of places subsequently to determine the basis on which the assessment will be made. For example, in section 12 railway companies are now exempted from the provision of providing the value of their lands as they understand them, and the value of railway lands is to be assessed according to the value at which lands are assessed in the immediate vicinity.

Similarly, as I say, this applies in section 11 with respect to public utilities. Further on in the bill, if my memory serves me correctly, there is another reference: “Section 20 provides that in valuing any land, references to the value of other land shall include only similar land in the vicinity.”

It would appear to me that the bill incorporates in it a principle which has never yet been that clearly enunciated -- namely, that the value of any particular land is to be related only to the value of lands in the immediate vicinity. I would like to ask the minister if he would explain whether or not he is incorporating in the bill a principle which has been enunciated over a period of time in judicial decisions relating to assessment, or whether he is altering substantially the basis upon which the assessment of land is to be determined; and whether it is wise to permit public utilities and railway companies and other such special bodies not to have to at least disclose the value that they place upon their lands for the purpose of assisting those who are in the immediate vicinity in determining the value of their lands?

Hon. Mr. Meen: Mr. Chairman, I removed the references to the requirement that the utilities and the railway companies and so on tell us what they think their land is worth. We think it’s the responsibility of my ministry to determine what those lands are worth, so we removed that requirement as being really superfluous.

Mr. Haggerty: Why don’t you assess them at market value?

Hon. Mr. Meen: The courts have said in trying to interpret what constituted “value of the lands in the municipality” that it was an inoperative and unworkable provision in our Act. You just can’t determine what is the appropriate value if you’re looking at the value of the lands in the municipality -- the expression that had been used -- because it can vary from perhaps a fairly low value near the utility lines to perhaps some pretty sophisticated high values elsewhere in that municipality.

I don’t have any court cases to cite to the hon. member, but there has been an indication in these cases that it would be far better to have a provision such as “in the immediate vicinity” as a way in which the assessors and the people affected could determine just what the value of the railway lands or utility lands was, rather than trying to determine an average value across the municipality.

Mr. Renwick: Mr. Chairman, I spoke about this at the first section where it appears. I really wanted the minister to address himself so that I wouldn’t have to raise it again when we get to that section, because we are all anxious to get out and work on the hustings in the federal election, as you know.

Hon. S. B. Handleman (Minister of Housing): You would never know it.

Mr. F. Laughren (Nickel Belt): Especially the Treasurer.

Mr. Renwick: And particularly the member for Riverdale. But in any event it says: “Section 20 provides that in valuing any land, references to the value of other land shall include only similar land in the vicinity.” I’m really curious as to what this does to the principle of establishing a uniform assessment system across the Province of Ontario based on fair market value --

Mr. Cassidy: That’s right.

Mr. Renwick: -- if, in fact, the Assessment Act is now going to have an immensely restrictive provision saying that the value of lands is to be related only to the value of lands in the immediate vicinity.

It seems to me that you therefore automatically rule out a number of indicia of value which would otherwise be available for the purpose of providing for a uniform assessment of all the assessable land in the Province of Ontario, based on fair market value. I personally think it’s not worth even discussing much further, because the conundrum which the minister has proposed indicates very, very clearly that this government is, in the course of this bill, repudiating the basis of a uniform assessment across the Province of Ontario on the basis of fair market value, because you cannot get to a uniform assessment of all the assessable land in the Province of Ontario under an Assessment Act which provides that in valuing any specific parcel of land you can only do it in relation to lands in the immediate vicinity.

As I say, it’s only because of the imminence of the federal election and my desire to get out into the hustings and help my colleague, the member for Broadview -- who doesn’t need my help, but it’s such a pleasant time of the year to canvass -- that I don’t choose that we should divide the House on this particular vote.

But I want the minister to understand that we in this party consider this bill to be a repudiation of the proposition that there is going to be a uniform assessment of all assessable land and buildings across the Province of Ontario on the basis of fair market value. And this section and the following section, and section 20, are the reasons for our conviction that this is the deliberate policy of this government.

Mr. Chairman: Any further comments, questions or amendments?

Mr. Cassidy: Yes, Mr. Chairman, I would just comment on this. There are a couple of principles here, and I suspect that it may be --

Mr. Chairman: Which section is this?

Mr. Cassidy: On section 12, Mr. Chairman -- 11, I’m sorry. On section 11, which refers as I recall to railway lands, the bill as it stands says that the land will be assessed in relation to the average value of land within the municipality. To change that to the average value of land in the immediate vicinity, has got some sense to it.

The problem is, though, that that principle which may have some relevance in relation to utility land or railway land -- which is difficult to value because of the kind of use to which it’s put -- has no relevance when you get to section 20 or to section 25 of this bill, because in those particular sections you are talking about the valuation of lands generally, and not of a specific and difficult problem of valuation.

We will have a couple of amendments a bit later on, but I wonder if the minister can talk to this general problem. And if it can be related to section 11, let us suppose that there is -- is it railway land that is involved here?

Mr. Renwick: Public utility land.

Mr. Cassidy: I beg your pardon, utility land. Let’s suppose that there is public utility land which goes through an area of developable land not currently being developed, and which, therefore, as is the case in most municipalities, will bear the lowest ratio of assessment to market value of any land in the community. I think the minister is agreeing that that is the difficulty.

According to this particular section, that public utility land will be as under-assessed relative to other lands in the municipality as its adjoining lands. Now, that seems to me to be wrong. And the principle that says they should be assessed according to the average value in the municipality doesn’t make a lot of sense either, because it may be that the specific land that the utility has goes through an industrial area where land is not of great value, and the average value in the municipality might be higher.

But, it doesn’t seem to me to be right to perpetuate an under-assessment of utility land because it happens to be adjacent to developable land which is under-assessed.

I wonder if the minister can comment on that point?

Hon. Mr. Meen: Mr. Chairman, I think the hon. member is right. If the utility line runs through certain areas and some of them are developed and some of them are not developed, that piece of utility line which goes through an undeveloped area presumably has some lesser value. It is going to attract a lesser assessment than that section of the line that passes through the more expensive area. I think that is as it should be.

Mr. Cassidy: No, the minister misses the point completely. I am saying that if you take, for example, a utility property which passes through an area of land which is under-assessed because its value has gone up very rapidly in the last eight or 10 years, and which is under-assessed in relation to the average ratio of assessment to market value for that community, then the utility land is going to be equally under-assessed, because of the principle introduced here.

Hon. Mr. Meen: Yes, to that extent it would be and certainly through the period of the freeze and until it becomes adjusted to market value, we might encounter that problem.

Mr. Cassidy: Okay, but the point is, though, that the principle introduced here and elsewhere in the Act of valuing land or lands, including real estate, by relation to similar lands or by relation to lands in the immediate vicinity, has the effect of perpetuating inequities and anomalies which exist in the assessment system rather than correcting them. The minister should be in the business of correcting them once he introduces the principle that the freeze is a flexible freeze.

Hon. Mr. Meen: I don’t think this is expected to overcome anomalies. What we are trying to do here is achieve some mechanically practicable way in which to assess lands. Narrow strips of land have values that are hard to attribute; they are not in practical shapes and usable the way other pieces and parcels normally are.

What we are doing is trying to assess, to place a value on them, relative and comparable to the lands that abut them on either side. It seems to me that is a practical way to approach this question of assessment. It’s not one that is set out to overcome inequities, if they exist. One would hope we will overcome those inequities in other ways and thereby adjust proportionately the assessments under this section.

Mr. Cassidy: We are going to come to this principle again because the minister has now introduced the question of the valuation of similar lands, or adjacent lands or lands in the immediate vicinity. The point he makes is that the land in the immediate vicinity may be wrongly assessed but I don’t see why that mistake or that error should justify under-assessing utility land. The utility land should be assessed at the equivalent of fair market value which would be something approximating the ratio of assessment to market value for the community as a whole for that kind of land.

He is saying specifically that won’t be done and we are saying it should be done. If the minister won’t do it in this particular Act, you have the anomaly of the Treasurer, who gives this minister his orders, claiming to be controlling land speculation and other bold and brave deeds like that while his Minister of Revenue is perpetuating a system in which land speculators can hold land at far less cost than they should otherwise do. As the minister knows, if your taxation is subnormal on developable land you are holding for speculation the value of that land in the marketplace is going to be higher than it otherwise should be. The consequence of under-assessment and under-taxation is that the value of the land in the market is too high and that, in turn, is passed on to people who become homeowners or tenants on that particular land. If I could capsule that argument, in allowing this particular section and in accepting the principle that the under-assessment of developable land can be continued, the Minister of Revenue is simply fostering and encouraging speculation in land through his tax system.

Mr. Chairman: The member for Welland South.

Mr. Haggerty: Thank you, Mr. Chairman, I want to speak to this section 12. The member for Riverdale has mentioned it, too, and I think it’s a good point that he raised tonight. Why the minister wants to continue with preferred assessment rights to the railroads is beyond me. I think this has been on the statutes for well over 70 years and apparently you are not going to change the assessment value of railroads at all in Ontario. You are still going to allow them to have the preferred assessment privileges.

If I can recall, the railroads pay very little, even in school taxes. There is a certain section under the Assessment Act which gives them special assessment and I think they can only be assessed or taxed at, perhaps, 25 per cent of their actual value. If you are going to have market value in the Province of Ontario, this section will certainly defeat that purpose of bringing in market value of land throughout Ontario.

I can recall another instance when the former township of Bertie, along with the town of Fort Erie, tried to purchase some railroad property in the vicinity of the town of Fort Erie. I can tell you this much, if you try to buy land from a railroad, it’s one of the toughest companies to buy land from. You can’t get a true assessment of the property and when you come to buy it, they’ll certainly put their price where they think it should be, well above any other property being sold in the area. I know from personal experience that certainly, when it comes to selling or disposing of some of their land, they want to get top value for that land.

I think it’s time the minister started to remove this so that with section 12 of the Act they’ll pay market value in Ontario. One just has to look at the railroad, I think it is one of the biggest land-holding companies and perhaps one of the largest land speculators in Ontario. One only has to look at the assessment of the property on Front St.; I’m sure they are not paying their fair share of municipal taxes there.

I say to the minister, this section should be removed; it’s discriminatory. If he wants a fair assessment in the Province of Ontario, then all property must be assessed at fair market value, with no special privileges, such as he has allowed in section 12. I think it is time that the minister started moving out of the horse-and-buggy days; he should bring in fair market values for all land in Ontario and not allow the railways to have this preferred assessment. I wish he would bring that about.

Mr. Chairman: Shall section 12 stand as part of the bill?

Section 12 agreed to.

Mr. Chairman: Are there any further comments, questions or amendment on any later section of the bill?

Mr. Cassidy: Section 20.

Mr. Chairman: Is there anything before section 20? The member for Ottawa Centre on section 20.

Mr. Cassidy: My checking of the various clauses of the bill suggests that this is the best place to bring in the question of ratio between assessment and market value in the community. As a principle, it should govern the appeal board, the assessment review court, the OMB or anybody else who handles an assessment appeal, in addition to the value of lands in the community.

The way things stand right now, Mr. Chairman, according to the Act -- and I’ll read it: “In determining the value at which any land should be assessed, reference may be had to the value at which lands in the municipality are assessed.” That’s what the present subsection says, and it refers to appeals to either the assessment review board, the OMB, a county judge or even the Court of Appeal.

It’s interesting, incidentally, that there has been no effort, so far as I can recall, to try to streamline the whole process of assessment appeals, as was recommended to the government by the select committee on the OMB a couple of years ago.

The amendment here would take the standard for valuation, which has been there for some lengthy period of time, and change it to say that “reference may be had to the value at which similar lands in the vicinity are assessed.” Frankly, that is just not acceptable as far as we’re concerned.

If the amendment’s intention was to cover the case where there was a bit of farmland in the corner of a township, and you wanted to make sure that the farmland across the township line to the south and to the east was also borne in mind, as well as the value of farmland within that municipality, then it might make some sense.

I think the minister is aware that the more typical case will be an appeal wholly within a municipality, where there is no boundary problem. The assessment review court now will be blinkered into looking only at assessments in a particular area of a municipality, rather than looking at the overall assessment picture in that municipality as a whole.

This means that if property in a particular part of a municipality is generally under-assessed by reference to the ratio to market value for the municipality as a whole, then that would be perpetuated in the appeal. Or, for that matter, if property is generally over-assessed in that particular area in relation to the average ratio of assessment to market value, then that will be perpetuated. And that means there will be no equity and no justice available from the assessment review court.

I suspect that the member for Riverdale will want to say a word or two about this while I’m writing out the amendment, but what I’m trying to say is that these words referring to “similar lands in the vicinity” represent, if anything, a step backward in the principles of assessment. The minister is even nodding his head; I’m glad to see that.

Under section 64 as it stands, the problem is that the reference to the standards to govern the assessment review court and the other tribunals is too vague. It says that “reference may be had to the value at which lands in the municipality are assessed.” They can take entrails, they can read astrologists’ charts, they can do anything else they feel like, because there is no determination of a guideline which is to govern the assessment review court. This whole section should be redrafted in a way which is beyond our capacity in the course of one evening with a bill which is still only 72 or 96 hours old since we first saw this particular set of amendments. However, the reference that I will be putting in when the member for Riverdale sits down, assuming he gets up, will be that reference shall be made to the ratio of assessment to market value for the municipality as a whole in addition to the value of land in the community.

This will mean, if people find that they are significantly over-assessed or if I find that the guy down the street is significantly under-assessed, appeals may be brought in relation to market value. I would suggest that this would be one of the very powerful forces that will lead us toward the government’s still avowed goal of getting us to market value assessment. But I simply cannot tolerate a system which would allow developable land held by speculators to continue to be assessed at five or 10 per cent of its market value while the average ratio for the municipality is 20, 30 or 40 per cent. Yet that is the kind of system the minister is perpetuating with the proposals he has right here.

Mr. Chairman: The member for Waterloo North.

Mr. E. R. Good (Waterloo North): Mr. Chairman, I wanted to say something on this section. I would just like to make a short reference to an amendment we made earlier that deals in part with this thing.

The whole trend in the Assessment Act has been to make it more and more difficult to properly appeal an assessment. The whole appeal process is becoming weighted so heavily in favour of the assessment that has been put on that an average citizen or even anyone represented by the legal profession hardly has a chance to give an adequate explanation of why he feels his assessment is too high.

In the first place, the greatest disservice done to people was when the definition of land and real property real estate was set out to include buildings and land as one unit. That, in particular, is a very weighted argument in favour of an assessment review court where the person making the appeal is not allowed to argue his case separately for land and separately for buildings.

Then the next restrictive thing that the amendments of this Act have put in in recent years is limiting the area of comparison that an owner can make on his property in relation to other properties. What it simply means, Mr. Chairman, is if one whole subdivision or one whole shopping area or one whole commercial complex has been over-assessed, there is no way that the owner in his appeal can use for comparison anything other than another property in the same area which is also over-assessed. This amendment, as the member for Ottawa Centre states. makes it still more restrictive in the manner in which a person can appeal his assessment.

I had a very revealing experience just this spring when I appealed three assessments in a certain part of the province. None of them was mine.

Let me tell you, Mr. Chairman, the average citizen just doesn’t have a chance when he goes before an assessment review court trying to make a case that his assessment is so high. The minute you start to say, “I have no objection to the land assessment you have, but the building is too high,” or, “I think your building is all right but the land is too high,” you are out of order because the Act says you have to treat it all in one unit.

Even though the assessors assess you separately and they give you the information from your appraisal sheets of what your building is assessed for and what your land is assessed for, they won’t allow you to use it, because that would put you on equal terms with the assessors. They don’t want that. They want you arguing from uphill. You have to fight your case, knowing the information they have but they won’t allow you to use it. Now we get another amendment in here which is going to restrict you --

Mr. Haggerty: It sounds like the Workmen’s Compensation Board.

Mr. Good: -- to the comparisons that you are going to make in trying to assess your property. I can’t imagine why this amendment is put in here when you had 4,000 appeals in the district of Muskoka, when you introduced market value in this present year. You had 2,500 appeals in the county of Grey. I forget how many there were last year in Bruce. When you introduced market value there, there were something like 2,500 or 3,000. You are having over 10,000 appeals in the first three counties into which you have brought market value assessment. By making the appeal process more and more restrictive, it is naturally in the best interest of the assessors.

If an assessor can go out and say, “Gee, that is the first case we’ve lost in three days,” that is a feather in his hat. But when a person has to go into the assessment review court and be so restricted by amendments such as are in this section 20 -- which now says you can’t use other properties within the same municipality, only similar lands within the vicinity of your property -- it’s all weighted against the appellant and in favour of the assessment review court. I think the minister should --

Interjection by an hon. member.

Mr. Good: -- give us an explanation of why he doesn’t want to have a fair fight between the assessment department and the people who are trying to appeal their assessment, because you took the biggest right away when you disallowed the separation of land and buildings a few years ago. I argued against that very heavily at the time that was done. That was a shame in itself because, you know, you have to have the separation.

People are tearing down buildings right and left all over the province, because with your frozen assessment they can keep that land until 1977 at a low taxation rate and there’s nothing you can do about it, because you’ve frozen assessment on that. People are sitting on land and relieving themselves of three-quarters of their property taxes simply by tearing down the buildings. You do separate land and buildings in that instance, but you won’t allow people to have a fair fight when they go to appeal their assessment and now you are making it more restrictive.

Hon. Mr. Meen: Mr. Chairman, hon, members have referred from time to time to the Smith committee and I might just remind them that this was one of the cornerstones of the recommendations of the Smith report, namely, that we get to something realistic like market value and don’t try to distinguish the value of the lot on which a house stands from the replacement costs of the house that stands on -- for goodness sake, when you or I or anyone else in this chamber goes to buy a house, we don’t determine what the lot is worth and what the house is worth and its replacement value and the rest. We determine what do we want to pay for that house, sitting on that lot, in that location, having regard to the other homes around it and all the other factors and amenities that go into making that an attractive dwelling or not, as the case may be.

It was that basis of approach that the Smith committee used. The select committee adopted it, and we have adopted it in our approach toward market value assessment in not endeavouring to artificially separate the one from the other.

Mr. Haggerty: Why does the assessor separate land and building values?

Hon. Mr. Meen: When it comes to assessment under section 62(4), I believe, and I think it’s a sound basis for argument here, that it’s much more straightforward to look at the fair market value of lands in the vicinity than to try to get an average value or the fair market values across an entire municipality. You can take a very large community or a municipality like Toronto, with over 700,000 people -- 720,000, if memory serves me -- or you can take another large municipality like North York, with 520,000 people, or you can take some --

Mr. Cassidy: I am sorry -- to look at what?

Hon. Mr. Meen: -- small municipalities, and yet in these, particularly --

Mr. Cassidy: But that’s not what is being done, that’s not what is being done.

Hon. Mr. Meen: In these large ones, it is very difficult indeed to come to some kind of rational determination of an appropriate assessment to be placed on a piece of real estate, with or without a house on it, if you have to look across the entire municipality.

Furthermore, as if that were not a great enough difficulty, picture the case of a parcel being assessed that lies on the boundary of one municipality with another. Its values may very well be enhanced or reduced by what lies across the road in the other municipality, and yet as the section stands no heed might be taken of the value of the properties immediately across the road, regardless of how implicit their values were in determining the value of the property under question.

So I think it makes much more sense -- and the courts have indicated this to us -- it makes much more sense that we should give them the authority to look at the market value of the lands in the vicinity, and that is the reason for this amendment.

Mr. Chairman: The member for Ottawa Centre.

Mr. Cassidy: I am really disturbed by what the minister has to say. When I started these comments I picked on section 20 because it seemed the most logical place to raise this point, and now as we get into the debate I find myself being more and more disturbed, because the minister understands the Act differently than the words actually indicate it is to be applied.

He says he believes that when the assessment review court looks at an appeal it should look at the fair market value of lands in the vicinity, if this amendment is passed. But if I can read the way the section will go, Mr. Chairman, it will read if amended according to the minister’s amendment:

“In determining the value at which any land should be assessed, reference may be had to the value at which similar lands in the vicinity are assessed.”

Now, that doesn’t make any reference to fair market value at all. The minister nods. Okay. That makes no reference to fair market value. It makes reference to the assessed value of lands in the vicinity.

We are saying as a party, that if the lands in the vicinity are under-assessed, or over-assessed, if they are severely out of line with the average ratio of assessment to market value in that community, then the appeal board is forced to be perverse according to this particular amendment. It is forced to reject an appeal against a reduction of assessment, for example, where the guy is clearly being over-assessed, and the guy is simply hung by the fact that somewhere along the way the lands adjoining have been over-assessed.

Now, the appeals against under-assessment are obviously much less, but if a municipality knows its onions and starts to get busy, the municipality could start to go around and find millions and millions of dollars of taxable value which is not being assessed right now because of the change in the value in particular of developable land. I think it would be quite proper for that municipality to seek to appeal those under-assessments, in the same way that some municipalities quite profitably have put municipal officers to work in seeking out lands that were not caught up on the rolls because of the inadequacies of the provincial assessment procedures. I know certain municipalities -- I think Nepean is one -- where they have saved hundreds of thousands of dollars by recouping taxes for the expenditure of one or 1½ taxation control officers to pick up on the mistakes and the errors and the omissions made by the province.

A municipality could, without this amendment, go to town and pick up a lot of assessable value from under-assessment. In the process it could possibly scare away some of the speculators who are making life so difficult for its citizens and people who want to move into its borders. But it can’t do it, because this particular section protects speculators, Mr. Chairman.

Very specifically, it protects speculators. It also protects people who are under-assessed. It also penalizes people who are over-assessed, because it gives them no viable or valid grounds for appeal.

They go into the appeal court or the assessment review court, and all they can do is say: “I am over-assessed.” The appeal court says, “What about your neighbour?” The appellant says, “Well, my neighbour is over-assessed as well.” The appeal board looks at the standard and says, “Well, that’s tough, baby. That’s tough, because all we can have regard to is the assessed value of similar lands in the vicinity.”

The fact that the section says “it may have regard to that” -- the minister is nodding his head at that one as well -- nevertheless, the only guideline laid down in the legislation is “to have regard to some of the lands in the vicinity,” and nothing else. Therefore, in 99 cases out of 100 that is what the courts are going to follow, because no other guideline is put forward to them.

Mr. Cassidy moves that section 20 of Bill 87 be deleted and that section 64(2) of the Act be amended to read: In determining the value at which any land shall be assessed, reference shall be had to the value of which lands in the municipality are assessed, and to minimizing any difference between the ratio of assessment to fair market value for the land in question and for that class of land in the municipality as a whole.

Mr. Cassidy: I hope that’s clear. If the minister accepts the principle of the amendment, we could stand the clause while his draftsmen clean up the proposal.

Nevertheless, there are two basic changes here. They are to require the assessment review court to have regard to the value of the lands in the municipality and to have regard to the ratio between assessment and market value for the particular piece of land and for that class of land for the municipality as a whole. Those are the two changes that are proposed, Mr. Chairman.

Among other things, this would be a very powerful protection for people who are over-assessed. It would also be protection for municipalities with a large amount of under-assessed land still frozen according to this particular Act. Because when we get to their relevant section, we will find that the flexibility built into the Act only allows reassessment or upward assessment of land where its value has increased in relation to land in the immediate vicinity. So if there is a whole class of land or a whole section of the community which is desperately, badly under-assessed, it cannot be touched for another two years.

Mr. Chairman, perhaps the minister can say why his government so favours speculators when, with another arm, he’s going to tax them?

Hon. Mr. Meen: I have no idea what the hon. member is trying to get at. I’ve listened to him with patience and, frankly, his amendment negates the purpose of this section. He would --

Mr. I. Deans (Wentworth): Patience?

Mr. P. D. Lawlor (Lakeshore): But not with understanding. Patience won’t do.

Hon. Mr. Meen: -- make it a mandatory requirement, whereas the amendment which I have proposed is permissive to the assessment. I was shaking my head “no,” not nodding it “yes,” when he was busy indicating that it was mandatory on the court to look only at the value of similar lands in the vicinity.

It says, “reference may be had to the value.” He is negating that by proposing, as I understand his amendment, to say that “reference shall be had to lands in the municipality,” and then he loses me in his complex subjunctive clause at the end, I simply feel that it cannot be supported. It would complicate this section unnecessarily and would add nothing. Indeed, it would negate, as I indicated, the very purpose of the reference to lands in the vicinity, and I must therefore object to the amendment.

Mr. Cassidy: That is a pretty poor kind of attack. You are the Minister of Revenue -- you are not a kid.

Mr. Renwick: Come on, it is not a game.

Mr. Chairman: Those in favour of Mr. Cassidy’s motion will please say “aye.”

Mr. Cassidy: No, I’m sorry. I can’t accept what the minister has to say. He has my copy of the amendment. I hope he studies it carefully. Let me give him an example and then perhaps we can have his comment on the example.

Let us suppose that there is an appeal by a municipality against the assessment of land which the municipality considers to be under-assessed. This is a tract of five acres, for the sake of argument, which is worth $100,000 an acre which is valued at $5,000 an acre for assessment purposes, or at five per cent of market value. Does the minister understand that?

Hon. Mr. Meen: No, I am not sure I do. How would you like to try that once again?

Mr. Cassidy: Okay. The assessment is $5,000, the market value is $100,000, the ratio of assessment to market value is five per cent.

Hon. Mr. Meen: That much I can follow.

Mr. Cassidy: Okay, I’m glad to hear that. I thought this fellow was meant to be a fancy lawyer who got $75,000 a year if he wasn’t devoting himself to public service?

Mr. Renwick: He is a fancy one all right. “Fancy Dan” he is called.

Mr. Cassidy: Mr. Chairman, the municipality, according to the amendment put forward by the minister, has not got a leg to stand on because it goes in and says, “Look, this land is assessed at only five per cent of its value,” and the assessment review board says, “That’s fine, now what about the land in the immediate vicinity?” The municipality has to say, “That land is also assessed at five per cent of its value, and there’s been a very large escalation in market values in that particular end of town, therefore there is a general under-assessment there,” and the assessment review board simply throws them out.

According to the existing section -- and if anything else it would be better to simply guard the existing section than to bring in the amendment that the minister proposes -- the assessment review board and the other tribunals may have reference to the value at which lands in the municipality are assessed generally. At this point the municipality, under the old section, could have said, “The average ratio of assessment to market value for our municipality is 25 per cent.” In other words, if this land in question was valued at the average ratio then the assessment value should have been $25,000 an acre instead of $5,000 an acre. Does the minister follow the example that far?

Now under the old section it could do that, and under the proposed amendment that I put it could do that, because it could have reference to the ratio of assessment to market value for that class of land for the municipality as a whole, and that would mean that the municipality could seek to get a reasonable return from land that was grossly under-assessed.

Let me take another example, Mr. Chairman. Suppose, for the sake of argument, that there is a residence, a house, say, and the owner feels that he is too heavily taxed. He is paying taxes of $1,000 a year, his assessment is $15,000 and as it happens, for the various reasons, the valuation of his house is only $30,000, for sake of argument, so his property is assessed at 50 per cent of its market value.

Now, it is in a declining end of the city where the assessments generally are around 50 per cent of market value because property values have simply not gone up in proportion with other parts of the city. It may be that an expressway has been built in that particular area, or there has been some other factor which has tended to depress property values and to keep the assessed value high in relation to the market value.

If they go into the assessment review court, under this particular section proposed by the minister, all they can say is that the place down the street is assessed at 50 per cent of market value; and the assessment review court will throw them out. They will continue to spend $1,000 a year on taxation on a $30,000 home.

If, on the other hand, they can look at the ratio of assessment to market value for the community as a whole, they can easily show that the average ratio for the community is perhaps 25 per cent. So that, normally a $60,000 house would be assessed at $15,000, and a $30,000 house would be assessed at $7,500, and they would have a very valid case for a reduction of their assessment because of those particular circumstances. Does the minister follow that example?

Hon. Mr. Meen: I have listened to what the member says.

Mr. Cassidy: Does the minister follow the example?

Hon. Mr. Meen: I am listening to what you are saying.

Mr. Cassidy: I would appreciate if you would listen with some understanding; although I recognize that is difficult for the minister, given his own kind of competence to do the job.

Hon. D. R. Irvine (Minister without Portfolio): Oh come on. Stop this nonsense! Why don’t you talk sense?

Mr. Cassidy: Look, I have trouble with you as well -- making you understand some very simple things about your performance.

Hon. Mr. Irvine: You sure do, unless you talk sense.

Mr. Cassidy: And this is one of the difficulties of this government; the kinds of ministers that are appointed to these particular offices.

Hon. Mr. Irvine: Why don’t you listen a little bit to your leader (Mr. Lewis) and talk to the bill?

Mr. Cassidy: It seems there are some real difficulties in having people who can master the complexities of this kind of legislation, and in having ministers who bring briefs in here, don’t understand them, haven’t looked at them, and haven’t been briefed.

Interjection by an hon. member.

Mr. Cassidy: It is a real abuse of the parliamentary process, Mr. Chairman, to have comments from ministers like that. It is really an insult to this House.

Hon. Mr. Irvine: Yes, you are.

Hon. Mr. Meen: You are not kidding.

Mr. Cassidy: Mr. Chairman, that is the point I am trying to make -- that there can be gross inequities between the ratio of assessment to market value, and there is no defence against them in an appeal, because of the very restricted grounds put in by the minister.

Hon. Mr. Meen: Mr. Chairman, if the hon. member has his way, the winners would be the industrial and commercial properties in this city and in other municipalities, and the losers would be the people with the little homes in the older part of town.

I am advised that that constitutes some 80 per cent of all the residents in this municipality, to picture one in which we have a wide disparity between the levels of assessment and market values -- as I mentioned earlier today, some of them as low as 5 and 10 per cent. Whereas, in the newer areas, the percentages of assessment to fair market value range upwards of 25 to 30 per cent.

If one were to revert to his section, one would run the risk of potential assessment on the current formula based on the average across, say, the city of Toronto. It may well run at, let’s say, 15 to 20 per cent, and thereby double the assessment of a whale of a lot of the houses in the less prosperous parts of this city that happen to presently have --

Mr. Cassidy: You hide behind widows and orphans every time, don’t you?

Hon. Mr. Meen: -- assessments at 5 or 10 per cent. And the ones who would be hurt by this are the very people the hon. member for Ottawa Centre and Toronto and the Islands would be purporting to help. But he isn’t helping them; he’d be hurting them.

Mr. Cassidy: I am sorry, Mr. Chairman, on a point of privilege. Would the minister please use my riding correctly from now on? We have had a ruling from the Speaker on that particular point.

Mr. Chairman: What is your riding?

Hon. Mr. Irvine: Who do you represent? That is a good question.

Mr. Chairman: What is your riding?

Mr. Cassidy: My riding is Ottawa Centre. The minister knows it.

Hon. Mr. Irvine: Nobody else does. You are never there.

Mr. J. E. Stokes (Thunder Bay): The chairman does not have a diagram in front of him?

Mr. Chairman: The chairman has not got a diagram in front of him. I would think that the minister --

Mr. Stokes: That’s a falsehood. I see it. You have got one in front of you.

Mr. Chairman: I have not got one of your side in front of me that I can see.

Mr. Stokes: Right there. I can see it.

Hon. J. White (Treasurer and Minister of Intergovernmental Affairs): Settle down, or maybe we will ship you out on the next freight car!

Hon. Mr. Meen: I have completed my comments on section 20, Mr. Chairman.

Mr. J. E. Bullbrook (Sarnia): We will ship the minister out on a 747.

Mr. Cassidy: I wanted a comment from the minister on my correct riding before going on, on a point of privilege, please.

Mr. Chairman: I would think the minister should refer to the member for Ottawa Centre as the member for Ottawa Centre.

Hon. Mr. Meen: Then he is the member for Ottawa Centre.

Hon. Mr. Handleman: It may be only for a short time.

Mr. Cassidy: Thank you. Not only does the minister not know his portfolio, he doesn’t know his geography.

Mr. Lawlor: It would be forgivable if it was original. He is only following the Premier (Mr. Davis) and that’s no good.

Hon. Mr. Meen: I know.

Mr. Cassidy: That’s right. The minister is trying to say, Mr. Chairman, that industrial assessments or commercial assessments will affect residential assessments. The amendment specifically relates to the class of land and its ratio of assessment to market value. The class of land in particular which is going to be affected is speculative land holdings which are assessed at five per cent or 10 per cent.

I don’t see why he tries to hide behind widows and orphans and people like that in protecting speculators who have been getting a free ride from the small residential property taxpayer for, yea, these many years but that’s what he is doing.

Mr. Lawlor: He was so badly burned over that last bill, that land speculation thing, that he can hardly open his mouth about anything.

Mr. Chairman: All those in favour of Mr. Cassidy’s amendment please say “aye.”

All those opposed please say “nay.”

In my opinion the “nays” have it.

Mr. S. Lewis (Scarborough West): We will stack it.

Mr. Chairman: Call in the members.

Mr. Lewis: No, stack it.

Mr. Chairman: Stacking it? Okay, fine.

Is there anything further on the bill?

Mr. Good: Section 25.

Mr. Chairman: Is there anything before section 25?

The hon. member for Waterloo North.

Mr. Good: I would like an explanation of what procedure will be used. We have been operating on a frozen assessment roll from 1970 to 1974. The Act said there would be new assessment for 1974 and 1975. That has now changed and we have been told we will be operating on a frozen assessment from now until the 1975 and 1976 taxation except that under the amendments in section 20, the assessment roll as changed by the assessor shall be the roll.

I understand there will be a roll this year and next year following the new procedure that the roll be returned by the third Tuesday in December for taxation the next year. But there are unlimited powers given under this section. It says:

“Provided that where the assessor is of the opinion that an assessment to be shown on the assessment roll to be returned for the year 1974 or 1975 is inequitable with respect to the assessment of similar real property in the vicinity, the assessor may alter the value of the assessment to the extent necessary to make the assessment equitable ... ”

I want to know -- are we having frozen assessment or aren’t we? Evidently we are not, according to this, and if we are not, I want to know how they are going to alter assessments they feel are inequitable. Will it be on a province-wide basis? Will it be on a hit-and-miss basis? How are they going to find out what assessments, in their view, are inequitable for this return?

Undoubtedly any assessments which have been appealed are already corrected. Any additions under section 43, in the supplementaries, have already been added to the roll and new assessments have been added to the roll.

The way I read this section, the assessors can now go through and alter any assessments they feel are inequitable. What is the procedure there?

Hon. Mr. Meen: Mr. Chairman, the proviso at the end of the new 86 to which the member refers again contains the words “property in the vicinity.” Actually, the assessors will be allowed to raise or lower these assessed values which are considered to be inequitable in comparison with the average value of similar lands in the vicinity.

I am advised there are a number of municipalities in which residential or commercial lands are grossly undervalued. We are aware of those; we talked about them earlier. The reason for this will be to assist the assessors in bringing some kind of equity to these areas where they are grossly under- or over-valued.

Mr. Good: I’d like to know whether this is going to be done on a systematic levelling-out basis across the province or on a spot check basis. How are you going to decide which municipalities are going to be given this special treatment? I suppose if these changes are made they would be appealable; I presume they would be. To me, when you are working toward a new market value, it seems a strange departure from your custom of the last four years that you would suddenly give powers to have certain assessments readjusted.

Hon. Mr. Meen: Just for the two years, Mr. Chairman. The hon. member will have noticed subclause (a) deals with 1975 and subclause (b) deals with 1976. The information would come to us from a variety of sources, I would expect; from the clerks of the municipality; from individuals who think they are over-assessed in comparison with similar lands in the vicinity. I would think, without my assessors having to do very much, although I would expect they would have some knowledge of the ones which are grossly out of line one way or the other, this will come about not by spot checks, as the member for Waterloo North describes them -- not this sort of thing -- but through other information which comes to hand.

Mr. Good: Will the reassessments and notice of appeal have to be given out or what is going to happen?

Hon. Mr. Meen: Notices of appeal would have to be issued in accordance with the reassessment notice and there would be the usual procedure as is provided in the Act.

Mr. Good: If this is so important now why wasn’t this important all through the previous three years of frozen assessments?

Hon. Mr. Meen: I am afraid I can’t answer that one. I am fixing it up now.

Mr. Cassidy: Mr. Chairman, when I spoke on second reading of this bill I suggested it was unacceptable to us that the government would delay for another two or 2½ years past the election with no indication of what standards were going to come through or how the new assessment was going to look. I suggested the time had come for the government to put out the market value assessments and to announce its policy, in general terms, as to the percentage of market value assessment which would be applicable to different classes of property in municipalities across the province.

As far as we could see, this was an abandonment of the market value principle. While the minister commented on that, he gave no firm promises about when we will eventually see any kind of market value rolls or when we will see the results of the government consideration of inequities and other problems.

My notes here indicate that while market value assessments, according to the minister, were out as much as 40 per cent, it would take until May of next year, I think it was, for most of the information to be fed into the computers. It would take 15 to 18 months to determine the degree of shift, the nature of shift and what should be done, given the way the government works.

God knows how many months it would take after that for the minister or the government -- if this party is still in government -- to bring forward legislation, to get it through, to get it implemented, to get it reflected in the assessment rolls and to get a system of equitable property assessment in force across the province.

That being the case, we have thought of simply opposing the section as a whole. I think what we will do instead is suggest the government should do its best -- having lost the opportunity of doing that this year -- to make those decisions by the time the assessment roll comes down in 1975. That would mean, therefore, that we would delete section 86(b) in section 25, and I would so move.

The effect of that would be to allow for one year’s deferral rather than two and it would mean that if the government still felt it needed another year it would come back to this Legislature for authority for further deferral. At that time there would be the opportunity to get on to the record what the government was doing and how it intends to work.

I must say to the minister I am very worried about the length of time during which this assessment process has gone forward behind closed doors. I am quite serious about this, Mr. Minister. It’s five years by the time anything gets out to the public with the exception of two or three dry runs which have taken place not in urban areas but mainly in rural and cottage areas of the province.

There has been a space of about five or six years in which the assessment people have been working behind closed doors and talking mainly to themselves. They can check some of their work by relating it to the actual values at which property is changing hands, but in any particular year the turnover of property is maybe only three or five per cent of the total number of the 2.25 million properties that exist throughout the province.

It’s a relatively small number, Mr. Chairman. It seems to me they should be putting their work to the test of having each property owner or tenant, as the person who is most specifically concerned with the valuation of that particular property, assess the work of the assessors. But that’s not permitted because people just don’t know in 95 per cent of the province what the assessors are up to.

I move that section 86(b) of the Act in section 25 of Bill 87 be deleted. The effect of that would be --

Mr. Chairman: We don’t need a motion for deletion unless it’s an alternate. The question would be, shall subsection (b) stand as part of the bill?

Mr. Cassidy: I guess that would eventually be what you’d come up with, Mr. Chairman. I would like to have the minister’s comments on this though.

Mr. Chairman: Does the minister have a comment?

Hon. Mr. Meen: On the deletion of subclause (b), Mr. Chairman, and the reduction to one year, it’s obvious that I can’t accept that. We know now the programme ahead and the length of time it is going to take. I did mention that by the end of this year we’ll have the full complete rolls and assessment data for the residential accommodation in Ontario. By about May or June of next year, we’ll have the industrial and commercial end.

We know perfectly well it’s going to take us 15 to 18 months to do the assessment, that is, the analysis of this assessment data. There’s no point whatever in abridging by one year, when we know at this time it’s going to take two. We’re confident that we can do it in that time. If we had any doubts about that we’d be setting it up for, say, a three-year term. There is no point in coming back next year and saying, “We told you so. We couldn’t do it in a year and we’re going to have to take another year.”

We determined this schedule as long ago as last fall that it was going to take about two years from then in order to come in with the final material, and that’s exactly the way it looks six months later. I must reject that proposed amendment.

Mr. Chairman: I shall place the question then.

Mr. Cassidy: Before you place the question, Mr. Chairman, can I make another comment or two? Will the minister undertake to do a couple of things when the residential assessment is completed in, as he says, December of this year? I gather that would be updated market value assessments. Is that correct?

Hon. Mr. Meen: Yes.

Mr. Cassidy: When the commercial and industrial work is done in May or June, 1975, will the minister undertake to do a couple of things? One is to publish or make available and provide access to the public to these market value assessments? The other is to publish for the benefit of the Legislature and other interested parties, such as the tax foundation -- and I’m sure there are various groups of professionals who have a professional interest in this -- summary data and typical information that would enable people to understand and get a feel for the way in which the market value assessment has gone?

Once he does that, would he also undertake either through a legislative committee or through a group of people from the ministry who are appointed to hold hearings or through some kind of committee of inquiry or investigation -- I don’t know what you want to call it -- to hear representations from people in groups across the province about the adjustments that may be necessary or desirable from market value assessment?

As the minister gathers, we on this side of the House accept the position that the Smith committee originally took. That is: To have market value assessment at market value for all property across the province would cause an unacceptable degree of shift from commercial-industrial to residential property tax. The minister says that’s right. We accept that position, but there should be a full dialogue and debate about what the outcome should be, rather than simply a matter of government policy determined behind closed doors on the basis of no inputs at all.

The inputs that should come in should be twofold. One is a critique, an assessment, an understanding, an evaluation of the quality of the work of market value assessment that has been done by the ministry. Secondly, once the facts are out about the potential shift from commercial-industrial to residential and other shifts that may take place -- and possibly about the different kinds of shifts that may take place in different communities through the province; there is that possibility too -- then there should be as wide an input as possible from municipalities, individuals, groups and everybody else concerned.

Can we have those undertakings from the minister?

Hon. Mr. Meen: Mr. Chairman, the information that will be developed in our computers by roughly this time next year would not be in a form retrievable and publishable for general distribution. It will be necessary for my ministry to study that material in considerable depth, and I would not give any undertaking that the information would be published; it would be of no great value to anyone until we are able to study it and determine how it should be used in practice.

It would be much the way assessment is today. If you look at the assessment of any property, it is hard to tell its market value. It is also hard to tell what its taxes are; it depends on what the mill rate happens to be, for one thing. Therefore, it would be of no particular value, and I think it would involve an enormous amount of work to assemble and distribute it, or even simply to table it here in the House, which I do not propose to do.

As I have indicated, the material, when assembled, will be studied by my people. We will be using the computer to determine the degree of shift within classes and between classes; from that we will be able to determine the way in which the market value assessment can be used for municipal tax purposes for the year 1977. I would say that it would not be earlier than the fall of 1976 before we would have anything meaningful to bring to the House.

Mr. Cassidy: Can the minister say then what steps he proposes to take before the fall of 1976 to allow municipalities, interested professional groups, individuals and members of this Legislature to make comments or recommendations on the very practical problems that will be facing the government about how to accommodate the market value assessment and how to make the necessary adjustments?

Hon. Mr. Meen: No, Mr. Chairman, I am not prepared to say at this time.

Mr. Cassidy: I think this is a travesty then, Mr. Chairman. It’s a real travesty. Here we will have had assessment in the minister’s hands --

Mr. Chairman: Order, please. We are straying from this subsection into something that possibly will occur in the future. We are dealing with section 86(b) of the Act --

Mr. Cassidy: That’s right, yes.

Mr. Chairman: -- and that has nothing to do with what the member has been discussing in the last few minutes. I have let him ask questions for the purpose of clarification, but he is straying too far from the purpose of this particular subsection.

Mr. Cassidy: Well, Mr. Chairman, if I may come back to the subsection and to the section as a whole, this refers to the publication of the rolls on the old basis, and I am trying to find out when we are going to see rolls on the new basis.

I am also talking about the general problems that are raised by the continued deferral of rolls and of market value assessment on the new basis.

What the minister is telling the House is that for a period from 1970 to the fall of 1976, there will be no opportunity for public input because there will be no useful information made available to the public on which they can make those kinds of judgements and those kinds of recommendations.

Hon. Mr. Meen: I didn’t say that.

Mr. Cassidy: All right. What information will be available to the public then?

Hon. Mr. Meen: Mr. Chairman, I will repeat what I said -- though I agree with you, sir, that this is completely out of order -- that I am not prepared at this time to say what steps we would take when the material is available and when my staff and I are analysing it and its potential significance in the municipal taxation field. I am not in a position to say what steps we will take at that time for public input.

Mr. Cassidy: Just a final point, Mr. Chairman, then I will subside.

Mr. Chairman: Be sure it is on this particular amendment, please.

Mr. Cassidy: It’s on this amendment, yes. I just want to say as a final comment, Mr. Chairman, that if this government ever comes back to office --

Mr. Chairman: Order, please. That is not in this amendment.

Mr. Cassidy: -- we will be here in 1976 --

Mr. Chairman: Order, please! The member is out of order.

Mr. Cassidy: -- and we will be asked to judge --

Mr. Chairman: Will the member take his seat?

Hon. W. A. Stewart (Minister of Agriculture and Food): One sure thing: You won’t be back if we can help it.

Mr. Chairman: Shall section 86(b) of the Act stand as part of the bill?

Those in favour of section 86(b) standing as part of the bill will please say “aye.”

Those opposed will please say “nay.”

In my opinion the “ayes” have it.

Mr. Cassidy: Okay, we will stack that, Mr. Chairman.

Mr. Chairman: No, it is not stacked; it is carried.

An hon. member: No, no.

Mr. Chairman: There were not five people standing when I looked up; it’s carried.

Mr. Cassidy: There were five people, Mr. Chairman.

Mr. Chairman: Not when I asked the question and looked up.

Mr. Cassidy: I challenge the ruling of the Chair, Mr. Chairman.

Mr. Chairman: Are there any further comments, questions or amendments?

Mr. Cassidy: If you wish, we would like to stack that section, Mr. Chairman. Otherwise, I challenge the ruling of the Chair.

Hon. Mr. Meen: Let them stack it, Mr. Chairman.

Mr. Chairman: We’ll stack it.

Mr. Cassidy: Thank you very much.

Mr. Chairman: Any further comments, questions or amendments on any later section of the bill?

Mr. Bullbrook: That is called a message from the government, not a message from the gods.

Mr. Chairman: All right. Call in the members. We have two stacked motions.

The committee divided on Mr. Cassidy’s amendment to section 20 which was negatived on the following vote:

Clerk of the House: Mr. Chairman, the “ayes” are 32, the “nays” 42.

Mr. Chairman: I declare the motion lost and the section carried.

The committee divided on the motion that subsection (b), section 25, stand as part of the bill, which was approved on a stacked vote, same count as the first vote reversed.

Bill 87 reported.

Hon. Mr. Winkler moves the committee rise and report.

Motion agreed to.

The House resumed; Mr. Speaker in the chair.

Mr. Chairman: Mr. Speaker, the committee of the whole House begs to report one bill without amendment and asks for leave to sit again.

Report agreed to.

Mr. Speaker: I beg to inform the House that in the name of Her Majesty the Queen, the Honourable the Lieutenant Governor has been pleased to assent to certain bills in her chambers.

ROYAL ASSENT

The following are the titles of the bills to which Her Honour has assented:

Bill 6, An Act to amend the Milk Act.

Bill 35, An Act to amend the Ontario Water Resources Act.

Bill 37, An Act to amend the Environmental Protection Act, 1971.

Bill 39, An Act to amend the Pesticides Act, 1973.

Bill 44, An Act to amend the Forest Fires Prevention Act.

Bill 50, An Act to amend the Property Tax Stabilization Act, 1973.

Bill 51, An Act to amend the Regional Municipal Grants Act.

Bill 52, the Municipal Unconditional Grants Act, 1974.

Bill 56, An Act to amend the Business Corporations Act.

Bill 57, An Act to amend the Paperback and Periodical Distributors Act, 1971.

Bill 58, An Act to amend the Mortgage Brokers Act.

Bill 59, An Act to amend the Collection Agencies Act.

Bill 60, An Act to amend the Regional Municipality of Niagara Act.

Bill 63, An Act to amend the Housing Development Act.

Bill 65, An Act to amend the Municipal Elections Act, 1972.

Bill 69, An Act to authorize the Raising of Money on the Credit of the Consolidated Revenue Fund.

Bill 70, the Denture Therapists Act, 1974.

Bill 71, An Act to amend the Dentistry Act.

Bill 76, An Act to amend the Ministry of Government Services Act, 1973.

Bill 77, An Act to amend the Public Service Superannuation Act.

Bill 78, An Act to amend the Shoreline Property Assistance Act, 1973.

Bill 79, An Act to amend the Credit Unions Act.

Bill 80, An Act to amend the Succession Duty Act.

Mr. Speaker: I must inform the hon. members in accordance with the provisions of standing orders 27 and 28 the hon. member for Wentworth (Mr. Deans) had properly given me notice under standing order 27(g) that he was dissatisfied with the answers given to him during the oral question period. This was on Thursday last, I believe.

Hon. E. A. Winkler (Chairman, Management Board of Cabinet): Mr. Speaker, I’m wondering before we proceed with that debate if we could revert to motions.

Mr. M. Shulman (High Park): No.

Hon. Mr. Winkler: Reports rather.

Mr. Speaker: Could I have the unanimous consent of the House to revert to reports?

Mr. Shulman: No.

Mr. Speaker: I hear a dissenting voice. We therefore do not revert to reports.

Hon. G. A. Kerr (Solicitor General): There is dissension within the group over there.

Mr. Speaker: I might say that under the provisions of standing order 28 -- at 10:30 o’clock on any Tuesday the Speaker shall deem that a motion to adjourn has been made unless the House sits beyond 10:30 by a motion of the government. There has been no motion made by the government, we are in session and since it’s not by motion, I therefore deem the motion to adjourn to have been made and I’m going to permit the debate under section 27(g).

I might also inform the hon. members that, since the House was in committee this afternoon, I neglected to inform the hon. members by 5 o’clock as provided for. I’m sure the hon. members will overlook that, in view of the fact that I did, in fact, notify the minister involved and the hon. members here. Therefore it is my opinion that we should proceed with this debate.

The hon. member for Wentworth may proceed for five minutes.

WORKMEN’S COMPENSATION BOARD PENSIONS

Mr. I. Deans (Wentworth): Thank you, Mr. Speaker. I must confess to being a little perplexed because frankly I had expected to be given some notice. I haven’t received it, but nevertheless I intend to proceed.

I want to say that if you recall, as other members do, that I asked the Minister of Labour whether or not he was prepared to make some amendments to the Workmen’s Compensation Act in order to reflect what is obviously an inadequacy in the payments that are made to people, both in terms of their pensions and in terms of the widow’s disability.

Interjection by an hon. member.

Mr. Deans: The minister made the same answer to me that was made by his predecessor and some other ministers over the last year and a half, that the matter was under consideration. In fact, as I recall, the previous minister, who has now left the Legislature, indicated that it was a matter that might well be considered by the group studying the Workmen’s Compensation Board. That never seemed to take place, and I want to suggest to the present minister that we on this side of the House are fed up with the procrastination, with the lack of action on the part of the government with regard to the updating of pensions paid to people on workmen’s compensation.

I don’t think there is any member of this House who doesn’t believe that it is long past time for a complete revision of the Workmen’s Compensation Board payments as they apply to people who are on widow’s pension and on disability pension who may well have been injured 10 or 15 years ago. I don’t think that the minister himself thinks that the payments that are currently being made are adequate, and I don’t quite understand how it is that the Workmen’s Compensation Board could have made recommendations six months ago to the Minister of Labour, and that the previous Minister of Labour and this Minister of Labour could have sat for so long on those recommendations and not brought them to the cabinet, and that the cabinet could not have acted to bring those recommendations forward in the way of legislative changes. I suggest to you, sir, and I suggest to the minister, that the minister’s answer at this time is repetitious, and because it is repetitious it is inadequate. There is no point in telling us that as the Minister of Labour, new though he may be --

Mr. E. M. Havrot (Timiskaming): Sounds like a broken record.

Mr. Deans: A broken record? It’s funny the member should say that, because the member for Timiskaming, being one of those who rarely ever enters debates and who often speaks from his seat --

Mr. Havrot: Don’t be such a big hero. The member is a big hero. I wouldn’t waste my time in this House.

Mr. Deans: -- and whose mouth is obviously bigger than his intentions --

Mr. J. F. Foulds (Port Arthur): And his mentality.

Mr. Speaker: Order.

Mr. Deans: -- doesn’t understand the problem.

Mr. M. C. Germa (Sudbury): He has a brain like a pea.

Mr. Deans: I think the Minister of Labour, who is sitting there, well understands that --

Interjections by hon. members.

Mr. Speaker: Order.

Mr. Deans: -- for about 12 months there have been promises made by Ministers of Labour about proposed changes in payments to the WCB pension recipients.

I can well recall, as I am sure he can well recall, that about six months ago, in November of last year, when I asked the same question, it was clearly indicated by his predecessor that changes would be forthcoming in the new session of the Legislature. There isn’t one of us who thought that meant sometime in the fall of 1974. There isn’t one of us who thought that meant there would be a delay of 10 to 12 months in the implementation of adequate pension levels for widows and those who are disabled.

I say to you frankly, Mr. Speaker, as I say to the minister, that his answer with regard to my question was totally inadequate. It is not nearly good enough, some seven months after the initial question to his predecessor, after he had indicated that there were going to be changes made, to say that he is still studying the matter, that it is still on his desk; that at some point he will be making recommendations to the cabinet and that maybe we will see changes sometime over the summer, or maybe not until the fall.

The cost of living has affected every single person in the province and it has affected those who are in receipt of workmen’s compensation benefits, both disability and pension. I suggest to the minister that it is time he recognized that though he may well see that there are changes necessary in the minimum wage and though he may well personally understand that there should be changes to the WCB benefits, that we can no longer afford to procrastinate, that we can’t afford to inflict upon people, whose incomes are insufficient to say the least --

Mr. Speaker: The hon. member has about 30 seconds.

Mr. Deans: Fine.

We cannot afford to inflict on those people an additional waiting period, given the tremendous inflationary spiral that we are all feeling the pinch of. I want to suggest to the minister that he has between now and Friday, or maybe even until next Wednesday or next Friday, in which to make a statement which clearly indicates the intention of the government to alter the pension levels and to provide adequate pension levels for the people in this province.

Mr. Speaker: The hon. minister may now respond for a period of five minutes if he wishes.

Hon. J. P. MacBeth (Minister of Labour): Thank you, Mr. Speaker. My response will not be very long. I am aware of the problem that the hon. member for Wentworth raises and my predecessor was likewise aware of it.

Mr. Deans: He quit.

Hon. Mr. MacBeth: I accept the rebuke the member has given. The matter has been on my desk. I have now completed my review of it. All I can say, Mr. Speaker, is that I am very hopeful the announcement will be made soon as to what provision we are planning to make for the people who are giving the member for Wentworth concern and, sir, the people who are giving the government of the Province of Ontario concern.

Mr. Speaker: In accordance with the provisions of the standing orders, I now deem a motion to adjourn to have been carried.

The House adjourned at 10:55 o’clock, p.m.