Property Assessments

The Municipal Government Act Section 1(1) describes market value as follows:

(n) “market value” means the amount that a property, as defined in section 284(1)(r), might be expected to realize if it is sold on the open market by a willing seller to a willing buyer;

This definition would make the following assumptions:

• sufficient exposure time in the market
• neither buyer or seller are under any undue pressure
• both buyer or seller are well informed
• payment for the property is typical for the market

There are three approaches to value when valuing real property. 

• Sales Comparison Approach - Evaluations are based on the actual sale prices of other properties that have sold. This approach is most appropriate when the sales of similar properties are plentiful and reflect the typical market conditions. Of the three approaches it is the most easily understood by the public and courts.
  
   
• Cost Approach - Based on the premise that a property's value is set by the “cost” of replacing an equally desirable substitute within a reasonable time frame. This approach works best for newer improvements where depreciation is less of a factor and special purpose properties which do not tend to sell on a regular basis. It's important to note that cost and value are NOT necessarily the same: cost is the amount required to produce the item, whereas value is related to how desirable the item is to a potential owner.
• Income Approach - Based on the premise that a property's value is related to its ability to produce an income. This approach works best for properties that are typically rental type properties (i.e. apartment buildings, warehouses, etc.).

In Alberta, Non-regulated properties are valued according to the Market Value standard set out in the Municipal Government Act and Regulations. The Assessor utilizes all three approaches in evaluating these properties for assessment.

For further information on your property assessment calculation please contact the MD of Peace No. 135 Finance Department at 780-338-3845.

The valuation date is a fixed point in time at which assessment values are based. The valuation date ensures that all properties in a municipality are valued as of the same date. The valuation date set by the Municipal Government Act is July 1 prior to the tax year.

The second legislated date in the valuation process is the condition date. The condition date is the date on which the condition of the property is recorded for property assessment purposes. The condition date set by Municipal Government Act for property other than linear property is December 31 prior to the tax year.

For example: 2025 taxes are based on the 2024 assessment year. Therefore the physical condition date is December 31, 2024 and the valuation date is July 1, 2024 for the 2025 taxation.

Mass appraisal

Properties in Alberta are assessed using a method called mass appraisal. Mass appraisal is the process of valuing a group of propertied as of a given date, using common data, mathematical models, and statistical tests.

Data collection

Property data must be collected before an assessment can be prepared. Accurate and complete property records lead to more accurate assessed values. Detailed information is collected by on-site inspections, development/building permits issued from the County of Grande Prairie Planning Department, land titles and real estate listings.

Not all property is assessable for property tax purposes. The Municipal Government Act outlines what property is assessable for taxation. The act defines property as:

• A parcel of land
• An improvement
• A parcel of land and the improvements to it

This does not include furniture, automotives or other personal possessions.

Properties that are not assessed or tax include:

• Publicly owned infrastructure
• Minerals
• Property in Indian reserves
• Property in Metis settlements

Some properties are assessable, but not taxable. Properties that are assessed but then exempted (in whole or in part) from taxation include:

• Environmental, municipal, and school reserves
• Government properties such as hospitals, libraries and schools
• Colleges and universities
• Churches and cemeteries
• Property owned by some non-profit organizations

The simple answer is "yes". Portable or movable structures such as frame and fabric buildings, sheds, relocatable offices, relocatable metal oilfield buildings, mobile homes, cabins, and sea cans (to name a few) are assessable.

These portable structures are defined in the Municipal Government Act in Part 9, Section 284 1(u) “structure” means a building or other thing erected or placed in, on, over or under land, whether or not it is so affixed to the land as to become transferred without special mention by a transfer or sale of the land.

The exception to this is if the structure is less than 10'x10' or 100 ft2. In this case, the assessment would not include the structure.

The Municipal Government Act Part 9, Division I, Section 297 defines non-residential as follows:

(4) (b)    “non residential”, in respect of property, means linear property, components of manufacturing or processing facilities that are used for the cogeneration of power or other property on which industry, commerce or another use takes place or is permitted to take place under a land use bylaw passed by a council, but does not include farm land or land that is used or intended to be used for permanent living accommodation;

The Municipal Government Act Part 9, Division I, Section 297 defines residential as follows:

4(c) “residential”, in respect of property, means property that is not classed by the assessor as farmland, machinery and equipment or non residential.

Assessments of vacant land is based on market value and the use of the property. For example farmland or vacant non-residential.

If the parcel of land meets the definitions of farmland as defined in Municipal Government Act and Regulations, it is a Regulated Assessment. The assessment is based on its productivity level based on the rates developed by Alberta Municipal Affairs.

Each year, municipal councils determine the amount of money they need to raise through property taxes to operate their municipality. These operating costs will be used to determine the tax rates or mill rates.

A simple example to estimate the tax rate calculation is expressed in the following formula: Operating Costs / Assessment base = Tax rate.

The tax rate is applied to each individual property assessment using the following formula: Property assessment x Tax rate = Taxes payable.

This formula means that the assessed value of the property in dollars is multiplied by the tax rate set by the municipality. The result is the amount of taxes to be paid for each assessed property. A municipality may adjust its tax rate on a yearly basis depending on its revenue requirement. The tax rate a municipality chooses to set depends on the assessment base in the municipality and the amount of money it needs to generate using the property tax.

If the council requires more revenue to run the municipality and the assessment base in the municipality has remained the same, the council will have to increase its tax rate to generate the additional revenue. 

Assessments of vacant land is based on market value and the use of the property. For example farmland or vacant non-residential.

If the parcel of land meets the definitions of farmland as defined in Municipal Government Act and Regulations, it is a Regulated Assessment. The assessment is based on its productivity level based on the rates developed by Alberta Municipal Affairs.