SAMA regional manager Chandra Reilly (second row, centre) gave a presentation to council via Zoom. (Angela Brown/battlefordsNOW Staff)

By Angela Brown

In the chambers

SAMA working on study of N.B. hotel and motel properties related to assessment

Apr 30, 2020 | 4:33 PM

The Saskatchewan Assessment Management Agency (SAMA) plans to conduct a study this summer to see whether it would be a suitable for hotels and motels in North Battleford to have property income factored in for tax assessment purposes.

SAMA gave a presentation to city council this week discussing the option of implementing the income approach to valuation.

Council directed SAMA to start the process of conducting an analysis on incorporating the income approach to assessment within the hotel and motel commercial property sub-class within the city.

“They are going to begin that work,” Mayor Ryan Bater said. “It depends entirely on the affected properties co-operating by providing the necessary information. Once that is collected by SAMA, they will consult with the city about that approach and the current cost approach.”

When the study is complete, the city will make a decision on which approach to use.

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“At this point the work is really up to SAMA, and of course the different property owners to work with them on providing the information they need,” the mayor said.

According to City Manager Randy Patrick, local hotels have been asking the city for some time to have SAMA look at the income approach.

Patrick said in an email the hotels believe it might be a fairer way to determine their assessment.

“This is not necessarily just a reaction to the Covid pandemic,” Bater said. “This has been a conversation that has been ongoing for quite some time. Now we want to start taking action on it.”

In her report, SAMA regional manager Chandra Reilly said the association would gather data from the property owners on the properties’ historical income and expenses, typically over a three or four-year period. The 2020-year data would not be reflected in this study if the income approach is adopted for the 2021 year.

SAMA would also inspect properties to gauge their group type, looking at the number of rooms and amenities offered at each one.

“It’s important to know the income approach is not a master key to unlock all of the concerns regarding hotel and motel assessments,” she said. “So regardless of the approach to value that we use, the assessments are still all based on the same sales pool… the income approach is simply another tool that we use in our tool kit — it does come with its own positives and negatives like any other approach.”

SAMA’s current challenge is trying to gather the data amidst the COVID-19 situation.

“Our intent is that with that validated cost data, we would then take that information and implement it in the 2021 year,” Reilly said. “These plans are presently on hold due to COVID-19 restrictions, preventing us from being able to physically inspect these properties.”

However, she said SAMA is looking for other options to collect the information.

Council was supportive of SAMA starting its investigation into the possibility of changing to the property income tax approach for hotel and motel properties.

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angela.brown@jpbg.ca

On Twitter: @battlefordsnow