Ontario farm values vault to new heights Monday, April 15, 2013 by SUSAN MANN Ancaster resident John Carron knew that the assessment for the Chatham-Kent farm he shares with his brother would be going up. But he never anticipated the increase would add a brand new digit to the value of the 122-acre cash crop farm that hadn’t seen any improvements for the past six years. “I think it’s a big tax grab,” Carron says of the farm’s value jumping to $1.3 million in 2012 from $761,090 in 2008. Most of the increased value was on the farmland rather than the house, which he estimates only increased by about $5,000. “It’s based on people working out of Toronto and looking at Toronto properties,” he says. “For whatever reason in Toronto they bid up a lot of properties.” Larry Hummel, chief assessor for the Municipal Property Assessment Corporation (MPAC), says farmland increased the most of any property category for the 2008 to 2012 period. Farmland values rose an average of 46 per cent over this period. The period’s increase was also the largest rate of increase in that category for the past 10 to 15 years, he says. If the house portion is included in the farm property, however, the average increase is at 32 per cent overall. Rural residential homes “haven’t been increasing any different than other residential” properties, he says. MPAC is responsible for property assessment in Ontario and it assesses nearly five million properties in the province, according to its website. MPAC reassessed the value of all properties as of Jan. 1, 2012. It sent out updated assessment notices to property owners in the fall of 2012. Hummel says they became aware of the huge increases in farmland values during their recent assessment process and issued a news release in July 2012 to alert property owners. They also checked with Farm Credit Canada and the provincial agriculture ministry to confirm that the steep increases in farmland values they were finding was what was taking place. Increases were as much as 60 to 80 per cent on the best quality land in southwestern Ontario. In the latter half of 2012 alone, farmland value in Ontario increased on average by 11.9 per cent says Farm Credit Canada in its farmland values report released Monday. The federal agricultural lender notes the increase is part of a longer-term trend, which it attributes to “a strong agricultural economy fuelled by low interest rates, growing world food demand and resulting higher commodity prices.” Hummel says specific factors driving up land prices are: worldwide food shortages, higher commodity prices due to droughts, a demand for land to produce crops used for ethanol production, and a rising middle class in India and China leading to increased demand for commodities, such as meat and grains. Farmland values across North America and not just Ontario are affected. Carron, however, maintains that a five per cent increase for his farm property might be more realistic and filed a request for reconsideration just before the assessment corporation’s April 2 appeal deadline. “When you read newspaper articles and other things, they talk about in general property values have maybe gone up five per cent,” he says. BF OFA acknowledges drop in tire recycling fees but says they're still too high Canada's organic trade now worth billions, research reveals
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