Greater Sudbury loses years-long battle over taxing mining properties

A provincial tribunal upheld assessments slashing 14 Sudbury mining properties' values by 47%, costing the city $5-6 million yearly.

A provincial tribunal has ruled in favour of land assessments that reduced the value of 14 mining properties in Greater Sudbury by 47 per cent, translating into reduced tax revenue of between $5 million and $6 million annually.

In Ontario, property values are set by the Municipal Property Assessment Corp., which determines how much land is worth for taxation purposes.

In Ontario, property values are set by the Municipal Property Assessment Corp., which determines how much land is worth for taxation purposes.

When MPAC reduced the value of the mining properties owned by Vale Ltd. and Glencore, the city had to make up the revenue from other industrial, commercial and residential lands.

In Sudbury, mining taxes make up about five per cent of total property tax revenue, or about $20 million a year.

Greater Sudbury CAO Shari Lichterman said in an interview Tuesday that the city has been appealing the MPAC assessments since 2017 in hopes of recovering the tax revenue.

Lichterman said the city has no ill will toward the mining companies, which are understandably trying to lower their tax bill as much as possible.

But she said the city doesn’t believe the MPAC assessments are reflective of the true value of the land. The appeals were heard by the province’s Assessment Review Board (ARB).

“Certainly through these appeals, (we) demonstrated that we have some concerns with the way that MPAC is assessing properties,” she said.

“And that was really the point of this. There’s no ill will towards the mining companies -- they’re going to do the best they can to minimize their taxation … They certainly have their own challenges and they’re a huge economic driver for this city and we work very closely with them.”

The city appealed the 2017 MPAC assessments, as well as each subsequent tax year, in hopes of recovering some of the lost revenue. But the board ruled against them.

“The ARB ruled in favour of MPAC’s assessment, so they supported the 47 per cent reduction,” Lichterman said.

“So the city lost from that standpoint, but through this process, we were able to get some additional inspections and reviews of the properties and we identified a lot of pieces of property that were missed in the assessment.”

Recovered about $4M

So while not recovering the full amount, they were able to regain roughly $4 million in revenue from the 2017 to the 2023 tax years, which was more than enough to cover the $2 million the city spent on the appeal.

While not successful, Lichterman said the effort was worth it.

“It was our desire to have this assessment revisited so that we have more balanced taxation from the mining companies and less of that burden being transferred to other industrial, commercial and residential taxpayers,” she said.

“I think it was worthwhile to get this on the radar for MPAC and we continue to advocate to the provincial government … So, some progress from a city standpoint and certainly we wanted to make sure that we launched this appeal on behalf of all the taxpayers of Greater Sudbury.”

While the current battle is over, Lichterman said new MPAC assessments are expected soon. They were supposed to be completed in 2020, but like many other things, were delayed by the COVID-19 pandemic.

“So we await the next round of assessments that we hope the province will announce in the coming months,” Lichterman said.

Read the full decision by the ARB here.