Farm loses bid for appeal of MPAC tax assessment decision

Lorentz Farms Limited owns a 2.66 acre parcel of land located in Wellesley Township.  As part of the applicant’s adjacent farm operations, machinery and equipment used to dry alfalfa and turn it into pellets is located on this property.  The Municipal Property Assessment Corporation (“MPAC”) classifies land use for tax purposes.  MPAC classified the subject property as industrial and commercial.  Believing the proper classification to be agricultural, and thus subject to a lower rate of tax, the applicant appealed this classification before the Assessment Review Board ("ARB") in 2009.  During the ARB hearings, valuation of the property was conceded and it was agreed that the only issue between the parties was classification of the property.  The ARB determined that the treatment of the Alfalfa on the property amounted to “processing” within the meaning of s.6(1)(1)(i) of the Act and therefore, the MPAC’s classification was deemed to be correct.

Lorentz Farms then applied for leave to appeal the decision of the ARB to the Ontario Divisional Court.  Justice McGarry of the Ontario Superior Court of Justice dismissed the application for leave to appeal, ruling:

In my view, it is clear based upon the agreed facts, that “processing” took place as the treatment of alfalfa by grinding into a powder and producing pellets amounts to “processing”. Therefore, as it is likely that the operations on the subject property amount to “processing” within the meaning of s.6(1)(1)(i), the property was properly was classified as industrial and accordingly, there is no reason to doubt the decision of the ARB.

Read the decision at: Lorentz Farms Limited et al v. MPAC.