The Town of Banff has begun mailing property assessment notices, starting the Assessment Review Period – the time homeowners have to review and potentially ask to change their property’s assessed market value. Property assessments can be appealed, but as of April 24, they are set, and tax notices sent in May cannot be appealed.
Property owners who have not received their Assessment Notice by February 28 are asked to contact the Town at 403.762.1230 or email taxes.utilities@banff.ca.
“We encourage all property owners to review their assessment value and contact us if they have any concerns,” said Chris Hughes, Director of Corporate Communications. “Our assessor can help to address any questions about individual assessments and may be able to make changes if there was a mistake. We can also help people understand the appeal process.”
Property owners with questions or concerns with their assessment should contact the Town for one-on-one support by calling 403.762.1230. The property assessment team can answer most assessment-related questions, and may revise your assessment without needing to go to a formal appeal (also called a complaint). The deadline to appeal is April 24.
Budget sets tax increase
On January 18, Banff Town Council finalized the 2023 budget for all services, such as police, fire rescue, parks maintenance, street clearing and repair, garbage collection, family and community programs, and infrastructure projects. The final budget sets the total amount of taxes needed to pay for all municipal programs and services.
The 2023 Budget increased the total tax levy by 11.66% over 2022, for a total of $22.7 million. If the Town distributes the percentage increase equally between residential and commercial properties, the municipal portion of the tax increase in 2023 will be an average of 11.66% over 2022. In terms of dollars, commercial properties contribute about 70% of the total taxes needed, and residential properties contribute about 30%.
The tax increase compared to pre-pandemic 2019 represents a 9.1% increase, or 2.2% per year if compounded each of the four years. (The Town of Banff cut taxes by 17% in 2020 to lessen the impact on property owners affected by the pandemic and is returning to pre-pandemic revenue in 2023.)
The tax rate is set in April, after the province invoices the Town for the education tax to be collected on municipal bills. Banff property tax notices will be mailed to property owners in May.
For the typical residential dwelling valued at $467,100, the 2023 budget is estimated to increase municipal property taxes by about $135 for the year, or $11 for people on a monthly payment plan.
Increase in assessment does not equal an increase in taxes
The assessed market value of a property, relative to all other properties in Banff, determines its fair share of property taxes to help pay for Town services. To illustrate, a home valued at $800,000 will pay twice as much in taxes as a home valued at $400,000.
On average in 2023, residential properties increased in value by about 10% over last year, while commercial properties (non-residential) saw an average increase of 25%. (Last year commercial properties dropped in value 12%.)
But the change in assessed value overall does not correspond to the change in taxes.
For residential properties, if a dwelling experienced Banff’s average increase in assessed value for homes (10%), then the homeowner can expect to see an increase in municipal property taxes very close to the amount set by the budget (11.66%). If another homeowner sees their home increase in value higher than the 10% average, they will expect a tax increase higher than the 11.66% set by the budget. However, if a homeowner sees an assessment increase lower than the 10% average, or a decrease in value, they can expect a property tax change to be lower than the average increase or a drop in taxes.
For commercial properties – no matter if they are a hotel, a restaurant, retailer or service in the industrial district – they can estimate their tax increase based on how much their property’s assessed value changed in comparison to the 25% average increase. For example, if a hotel sees its assessed value increase greater than the 25% commercial average, then it should expect to see a municipal property tax increase greater than the 11.66% set for the average. Or if a downtown restaurant sees an assessment increase less than the 25% commercial average, they can expect a tax increase less than the 11.66% set by the budget. Properties that have an assessed value change significantly lower than the 25% average increase may see a drop in taxes.
This is important because non-residential properties changed in value differently, depending on what type of commercial operation and location. To illustrate:
- Commercials properties in the downtown core have increased in assessed value by an average of 20% in 2023, while they stayed about the same in 2022 and dropped by an average of 5% in 2021.
- Hotels in Banff have increased in assessed value by an average of 33% in 2023, after dropping by 21% in both 2022 and 2021.
- Commercial properties in the industrial district have increased in assessed value by an average of 10.5%, after remaining unchanged in 2022 and dropping in value by an average of 4% in 2021.
How are properties assessed?
Residential properties are assessed based on clear direction from the Government of Alberta, using the same factors that a real estate agent uses to price a home. The value is the estimate of what a home would sell for on the open market on July 1 of the previous year, based on conditions at the end of the year. To learn how homes are assessed in value, visit banff.ca/assessment
Commercial property is assessed using the income approach. First, the Town of Banff appraiser calculates a Net Operating Income for the property. This is calculated by determining the potential gross annual income of a property, then subtracting a typical vacancy allowance, management fees and structural maintenance costs. The Net Operating Income is then divided by a Capitalization Rate, and the result is the market value assessment for the property.
Appealing a property assessment
Property owners should review the details on their assessment notice. Check what makes up the property’s assessment value and compare the property’s assessed value with similar properties in the neighbourhood using the Assessment Roll posted online. (The Assessment Roll is a list of all properties along with their current assessed value as determined annually by the assessor.) Contact the Town if there are any concerns or questions.
If the assessment team or the Town’s assessor cannot resolve questions to the property owner’s satisfaction, they can file a complaint with the independent Assessment Review Board (this is also called an appeal). The deadline to file an appeal (complaint) is April 24.
More information is available at banff.ca/Assessment
To sign up for monthly property tax payments, rather than paying a bulk sum by June 30, follow directions at banff.ca/673/TIPP-Payment-Plan