Dr David Parker FRICS, FAPI, FAICD, SFFin’s Post

Last week it was my pleasure to present to Wellington City Council about the merits of switching from capital value to land value rates (NB: Link to video below). In short, I argue that land value rates would: - Be more efficient, equitable, and have positive externalities - Support capital investment (e.g. housing) and urban development Following my talk, Councillors were then presented with an opposing view, which instead argued the case for capital value rates. In my view, the presenter made three significant errors or omissions. First, the presenter interprets a higher R-squared between incomes and capital values as evidence that rating the latter would be more equitable. Unfortunately, the R-squared is not an appropriate basis for such a conclusion (NB: Rather, we're interested in the slope of the line). Second, the data that is used in this analysis is not a good basis for analysing the equity impacts of rating systems. Specifically, we want to understand the relationship between capital/land values and the income of *property owners* rather than *residents* (NB: Ideally, one would also use microdata, rather than averages by area). Third, the presenter argues that capital values are a better proxy for the use, or consumption, of council services. There are two key problems with this reasoning. First, if we want to charge based on consumption then why not simply adopt user charges? Second, and more importantly, much of the value of council services to users will ultimately be captured in land values. So, even when a property is completely undeveloped, such that it does not contribute to the consumption of Council services, the owner will still nonetheless benefit from these services by way of higher land values. Regardless of these points of disagreement, and regardless of which way the Council decides to go on this issue, I appreciated the opportunity to engage with Councillors on these questions. And I live in hope that other Councils in New Zealand will consider switching from capital value to land value rates in the future.

The lack of transparency about these sweeping proposed changes is highlighted in this article by Vancouver Sun columnist Vaughn Palmer. This would be a tectonic shift in the legal landscape that flows from precedential cases such as Haida, Taku River, Mikisew Cree, Little Salmon and Rio Tinto. BC citizens all deserve to know more about what is being proposed and how it will affect administrative decision-making in BC. #bcpoli #CDRR #complexdisputesandregulatoryregimes #adminlaw

current value — bylaw restriction — evidence — undevelopable — equitable adjustment In the case of **1097416 Ontario Inc. v. Municipal Property Assessment Corporation MPAC**, the appellant contested the assessed value of their vacant industrial land at 68 Trinity Church Road, Hamilton, for the 2023 and 2024 tax years. The initial assessment valued the property at $708,000. MPAC proposed a reduction to $668,000, while the appellant argued for a 90% reduction due to a bylaw restricting development access. The Assessment Review Board found the property's correct value to be $66,800 after applying a 90% downward adjustment, acknowledging the land's effective undevelopability. No equitable adjustment was warranted. Assessment Review Board Ontario #ONARB 1097416 Ontario Inc. v Municipal Property Assessment Corporation Region 19 2024 CanLII 60439 ON ARB Released: June 25, 2024 https://canlii.ca/t/k5kjv

Supreme Court Streamlines Development Impact Fee (DIF) Challenges On April 12, 2024, the United States Supreme Court issued its ruling in the Sheetz v. El Dorado, U.S. No. 2201074 stating that the Nollan/Dolan constitutional test applies equally to legislative and administrative permit conditions imposed by jurisdictions. In a nutshell, permit conditions must have an “essential nexus” to the government’s land use interest that are “roughly proportional” to a development’s impact on land uses. To date, courts have not agreed on the appropriate test for the validity of legislatively imposed impact fees. For local governments that routinely charge large development impact fees on new development without regard to the development’s impact on the land use, this ruling could require significant changes in the local governments’ methodology. Launch has been reviewing development impact fee studies for the private sector and local BIAs since the mid 1980’s and has been averaging a 22% reduction in development impact fee studies reviewed. Carter Froelich, CPA is also the author of the National Association of Home Builder’s Impact Fee Handbook 2008 and 2016 editions. For more information on any of these legislative developments or questions about development impact reviews in your state, please contact Pamela Giss (pamelag@launch-dfa.com) or Carter Froelich (carter@launch-dfa.com).

Our analysis of the likely changes on the horizon for the Built Environment sector over the course of the next parliament #residentialproperty Osborne Clarke

The Impact Assessment Act remains unconstitutional and unacceptable, and Alberta’s government is challenging the legislation to protect Alberta’s jurisdiction and our economy. In October, we gave the federal government a four-week deadline to address the unconstitutional provisions in the Impact Assessment Act or face another legal challenge. That four-week deadline has passed, so we are referring the matter to the Court of Appeal of Alberta where we will ask the court to confirm Alberta’s position that the Impact Assessment Act remains unconstitutional. The federal government’s recent amendments to the Impact Assessment Act fail to address the constitutional deficiencies the Supreme Court of Canada has identified. The federal government has again failed to listen to the courts and Canadians, so we will continue to do whatever it takes to protect our province from this federal overreach.

Should Angela Rayner jam through mandatory building targets? Here's a wonderful turn of phrase from almost fifty years ago. "...there are fewer checks on the executive than in most civilised countries: as Lord Hailsham, a Conservative lord chancellor, famously put it in 1976, Britain is an “elective dictatorship”..." A representative democracy is one in which the leaders collide with those they lead – both sides wielding cudgels made of facts. The technology exists for governments to create a "heatmap" showing the number of people in any given catchment area who need homes, overlaid on the green belt, grey belt, and brownfield sites that could be made available. The needs of the many could be calculated in concrete terms. How much do people lose if denied the opportunity to own a home? We know how much they pay in rent. Properties are likely to rise in value at a clip that mimics the growth of a mature economy – year after year, decade upon decade. The number would run to billions of pounds in most small locales, smack dab in the middle of middle England. It would be incumbent on local Nimbies to counter by calculating the loss they face in equally stark terms. Then, the judiciary and other organs of administrative law can develop objective measures against which to judge which projects to bless and which to block. No dictatorship is required, just facts. Give me facts. Mr Gradgrind. #socialinclusion begins at home (and sometimes in the Home Counties).

The last significant update to the planning system occurred in 1947. However, the government has recognised planning red tape needs to be cut if housing stock is going to be created at the required rate. This has triggered a range of #planninglaw reforms – some of which are already in force, with others expected very soon. Learn how continued changes to the Levelling Up and Regeneration Bill and revisions to the National Planning Policy Framework and more will impact planning law in 2024. Read the full blog here: https://lnkd.in/ev7kTZCx

We can be your management expert by supporting you to respond to external audit queries and during the preparation of accounting papers supporting your climate-related disclosures, ensuring compliance and reducing complexity for your finance team. Are you impacted? 📧 Contact us: help@simplifyclimate.co.uk 🌐 Learn more: www.simplifyclimate.co.uk #climatechange #sustainability #accounting

Interesting that the Aarhus Convention and judicial review of infrastructure projects have made it to an op-ed in the mainstream press today. Although The Times is wrong to say my review of legal challenges to infrastructure projects “is yet to report” - as Planning Magazine noted at the time, I submitted my report to the Ministry of Housing, Communities and Local Government (DLUHC as it then was) in late May within the 3-month deadline set by Government. It will be interesting to see if this is the start of a broader discussion on how to get the balance right in relation to JR in the context of infrastructure. I obviously can’t comment on the merits of the competing arguments on this issue whilst my report remains unpublished so please forgive me for not “liking” or otherwise reacting to anything anyone says in the comments below. #planning #environment #infrastructure #judicialreview #ruleoflaw #factcheck Have We Got Planning News For You