Sample Laws under the First Nations Fiscal Management Act

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ANNOTATED SAMPLE FIRST NATION PROPERTY ASSESSMENT LAW (SASKATCHEWAN) The First Nations Fiscal Management Act (“FMA”) provides a framework for First Nation real property taxation on reserve. First Nation fiscal powers are set out in Part 1 of the FMA and include, under section 5, the authority to make laws respecting taxation for local purposes of reserve lands and interests in reserve lands.

A First Nation wishing to implement property taxation will require two core laws, the assessment law and taxation law. These two laws work together to establish the property taxation framework. The assessment law creates the framework for conducting assessments of interests in land on reserve, including the duties of the assessor, the applicable assessment rules and practices, and the establishment and conduct of the Assessment Review Board.

Laws enacted under the FMA must comply with the legislative framework, which includes all requirements in the FMA, any regulations made under paragraph 36(1)(d) of the FMA and any standards established by the First Nations Tax Commission (“Commission”) under section 35 of the FMA. Canada has made the First Nations Assessment Appeal Regulations (“Assessment Appeal Regulations”) and the First Nations Assessment Inspection Regulations (“Assessment Inspection Regulations”). The Commission has established Standards for First Nation Property Assessment Laws (“Assessment Law Standards”) that provide further requirements for the form and content of assessment laws. The Commission has also established the Standards for the Timing of First Nation Annual Tax Rates and Expenditure Laws (“Timing Standards”).

The Commission prepares sample laws for use and adaptation by First Nations. The sample First Nation Property Assessment Law (“sample law”) complies with the legislative framework and provides a comprehensive assessment law that reflects assessment practices on reserve lands and incorporates components of the Saskatchewan provincial assessment scheme where appropriate. It provides a best practices sample for use and adaptation by First Nations in drafting their own FMA assessment laws.

This annotation of the sample law provides explanatory and additional information on key aspects of the sample law, and is intended to assist First Nations in creating their own property taxation laws. This annotated law is not intended to provide legal advice or legal interpretation, and should not be relied upon as such.

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__________________________ FIRST NATION PROPERTY ASSESSMENT LAW, 20__

(SASKATCHEWAN)

PART I PART II

PART III PART IV PART V

TABLE OF CONTENTS Citation ………………………………......... Definitions and References ………………

Administration …………………………….. Assessed Value ………………………….. Requests for Information and Inspections…………………………………

EXPLANATORY NOTES & COMMENTS The title of the law should include the name of the First Nation, and the year the First Nation will enact the law.

This indicates that the sample law has been created for First Nations located in Saskatchewan. This wording should be deleted in the First Nation’s law.

When the drafting is complete, ensure that all of the Part numbers and headings correspond to the actual Part numbers and the headings used in the law and that the corresponding page numbers are inserted.

PART VI Assessment Roll and Assessment Notice PART VII Correction and Amendment to Assessment Roll ………………………….

PART VIII Reconsideration of Assessment ……….. PART IX Assessment Review Board …………….. PART X Appeal to Assessment Review Board…. PART XI General Provisions ……………………….

SCHEDULES I Property Classes II Request for Information by Assessor

When the drafting is complete, ensure that the Schedule numbers and names correspond to the numbers and names used in the law.

III Declaration of Purpose for the Use of Assessment Information

IV Assessment Notice V Request for Reconsideration of Assessment VI Notice of Appeal to Assessment Review Board

VII Notice of Withdrawal VII Notice of Hearing IX Order to Attend/Produce Documents X Certification of Assessment Roll by Assessor

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WHEREAS: A. Pursuant to section 5 of the First Nations Fiscal Management Act, the council of a First Nation may

These recitals are recommended in order to show the authority for the law and the fulfillment of notice requirements. Additional recitals can also be included as the First Nation determines appropriate.

make laws respecting taxation for local purposes of reserve lands, and interests in reserve lands;

B. The Council of the __________________ First Nation deems it to be in the best interests of the First Nation to make a law for such purposes; and

C. The Council of the __________________ First Nation has given notice of this law and has considered any representations received by the Council, in accordance with the requirements of the First Nations Fiscal Management Act;

NOW THEREFORE the Council of T h e e n a c t m e n t c l a u s e is required in order to show the ____________________ First Nation duly enacts as follows:

Council’s intention to enact the law.

PART I CITATION Citation 1. This Law may be cited as T h e c i ta t i o n in c l u d e s t h e F i r s t N a tion’s name and the the ____________________ First Nation Property Assessment Law, 20___ .

PART II DEFINITIONS AND REFERENCES Definitions and References

year the law is made by the First Nation. Proper citation of the law should be used when referencing it in documents, forms or other laws.

The definitions used are the same as set out in the FMA, the Indian Act, the FMA Regulations and the First Nation’s Taxation Law. Where terms are not defined in those enactments, additional definitions are included to assist in the interpretation of the law. All definitions in this law should be consistent in the First Nation’s Taxation Law. When drafting is complete, any definitions that are not used in the law should be deleted.

2.(1) In this Law: “Act” means the First Nations Fiscal Management Act, S.C. 2005, c. 9, and the regulations enacted under that Act;

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“agency” means the Saskatchewan Assessment Management Agency established pursuant to The Assessment Management Agency Act, SS 1986, c A-28.1;

[Note to First Nation: Include this definition and the definition of “taxable area” only if providing for agricultural property to be taxed using taxable area.]

“agricultural property” means an interest in reserve lands classified as “non-arable (range)” or “other agricultural”;

“assessable property” means an interest in reserve lands that is liable to assessment under this Law;

“assessed value” means the value of land or improvements, or both, comprising an interest in reserve lands as if the land or improvements, or both, were held in fee simple off the reserve, as determined under this Law;

Include this definition and the definition of “taxable area” only if providing for agricultural property to be taxed using taxable area.

This term is used in the Assessment Appeal Regulations and therefore should remain in this law.

This definition ensures that the assessor can assess each interest in land on reserve at its market value as if held in fee simple off reserve.

“assessment” means the valuation and classification of an interest in reserve lands;

[Note to First Nation: If the First Nation assessor is qualified to and will undertake valuations, the following definition and all references to the assessment appraiser may be deleted from the Law.]

“assessment appraiser” means a person designated by Council under subsection 3(2) to carry out valuations;

If the First Nation appoints an assessor qualified to undertake assessment valuations, this definition and all references to the appraiser can be deleted.

“assessment manual” means the assessment manual established from time to time by the agency, pursuant to section 12 of The Assessment Management Agency Act

“Assessment Notice” means a notice containing the information set out in Schedule IV;

Assessment Notices must contain the information set out in Schedule IV, but are not required to be in the exact form set out in that Schedule. Assessment Law Standards subsection 7.2.

“Assessment Review Board” means a board established by Council in accordance with Part IX;

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“assessment roll” means a roll prepared pursuant to this Law, and includes an assessment roll amended under this Law [and an assessment roll referenced in subsection 11(7)];

“assessor” means a person appointed by Council under subsection 3(1);

“base date” means the base date established by the agency for determining the assessed value of land and improvements for the purposes of establishing an assessment roll for the year in which the assessment is to be effective and for each subsequent year preceding the year in which the next revaluation is to be effective;

“building” means any structure used or occupied or intended for supporting or sheltering any use or occupancy, and includes a trailer or mobile home that is

This terms reflects the definition used in provincial legislation.

(a) not in storage, and (b) situated on the reserve for a period of more than 30 days;

“chair” means the chair of the Assessment Review Board;

“complainant” means a person who commences an appeal of an assessment under this Law;

“Council” has the meaning given to that term in the Act; “First Nation” means the ___________ First Nation, being a band named in the schedule to the Act;

“holder” in relation to an interest in reserve lands, means a person

This term is defined in the FMA and it therefore cannot be changed in this law.

This definition is used in this law, the Taxation Law and in Commission Standards, and therefore should remain consistent in this law.

(a) in possession of the interest,

(b) entitled through a lease, licence or other legal means to the interest,

(c) in actual occupation of the interest, or (d) who is a trustee of the interest;

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“improvement” means (a) a building or structure erected or placed on, over or under land or over or under water but does not include machinery and equipment unless the machinery and equipment is used to service the building or structure,

This definition is used in the Taxation Law and in provincial assessment legislation, and therefore should remain consistent in this law.

(b) anything affixed to or incorporated in a building or structure affixed to land but does not include machinery and equipment unless the machinery and equipment is used to service the building or structure,

(c) any resource production equipment of any mine or petroleum oil or gas well, and

(d) any pipeline on or under land; “interest”, in relation to reserve lands, means any estate, right or interest of any nature in or to the lands, including any right to occupy, possess or use the lands, but does not include title to the lands that is held by His Majesty;

“market valuation standard” means the standard achieved when the assessed value of an interest in reserve lands

This definition is defined in the FMA and it therefore cannot be changed in this law.

This definition is used in provincial assessment legislation and therefore should remain consistent in this law.

(a) is prepared using mass appraisal; (b) is an estimate of the market value of the interest;

(c) reflects typical market conditions for similar properties, and

(d) meets any quality assurance standards established by order of the agency;

“market value” means the amount that an interest in reserve lands should be expected to realize if the interest is sold in a competitive and open market by a willing seller to a willing buyer, each acting prudently and knowledgeably, and assuming that the interest were held in fee simple off the reserve and that the amount is not affected by undue stimuli;

This definition is used in provincial assessment legislation and therefore should remain consistent in this law.

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“mass appraisal” means the process of preparing assessments for a group of interests in reserve lands as of the base date using standard appraisal methods, employing common data and allowing for statistical testing;

“non-regulated property assessment” means an assessment for an interest in reserve lands other than a regulated property assessment;

“Notice of Appeal” means a notice containing the information set out in Schedule VI;

This definition is used in provincial assessment legislation and therefore should remain consistent in this law.

This definition is used in provincial assessment legislation and therefore should remain consistent in this law.

The Notice of Appeal must include the name and address of the complainant and any representative of the complainant, a description of the assessable property, and the grounds for the appeal. Assessment Appeal Regulations subsection 7(2).

“Notice of Hearing” means a notice containing the information set out in Schedule VIII;

“Notice of Withdrawal” means a notice containing the information set out in Schedule VII;

“Order to Attend/Produce Documents” means an order containing the information set out in Schedule IX;

“party”, in respect of an appeal of an assessment under this Law, means the parties to an assessment appeal under section 33;

“percentages of value” means the percentages of value prescribed for property classes by regulation under The Municipalities Act, SS 2005, c M-36.1;

“person” includes a partnership, syndicate, association, corporation and the personal or other legal representatives of a person;

“property class” means the categories of interests in reserve lands established in subsection 7(1) for the purposes of assessment and taxation;

“Province” means the province of Saskatchewan; “railway roadway” means the continuous strip of land that is used by the railway company as a right of way, and includes any railway superstructure on the land;

“regulated property assessment” means an assessment for agricultural land, resource production equipment, railway roadway, heavy industrial property or pipelines;

The law uses the property classes established in the Province, where applicable.

This definition is used in provincial assessment legislation and therefore should remain consistent in this law.

This definition is used in provincial assessment legislation and therefore should remain consistent in this law.

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“regulated property assessment valuation standard” means the standard achieved when the assessed value of the interest in reserve lands is determined in accordance with the formulae, rules and principles set out in this Law, including as provided in subsection 6(14);

“reserve” means a reserve of the First Nation within the meaning of the Indian Act, RSC 1985, c I-5;

This definition is used in provincial assessment legislation and therefore should remain consistent in this law.

Laws made under the FMA can apply only on the reserve lands of a First Nation, as that term is defined in the Indian Act.

“resolution” means a motion passed and approved by a majority of Council present at a duly convened meeting;

“secretary” means the secretary of the Assessment Review Board appointed under section 26;

“tax administrator” means the person appointed by Council to that position under the Taxation Law;

“taxable area” means the total area rounded to the nearest acre;

Include this definition and the definition of “agricultural property” only if providing for agricultural property to be taxed using taxable area.

“taxable assessment” means the taxable assessment determined under subsection 6(13);

“Taxation Law” means the _______ First Nation Property Taxation Law, 20__ ;

“taxation year” means the calendar year to which an assessment roll applies for the purposes of taxation;

“taxes” includes (a) all taxes imposed, levied, assessed or assessable under the Taxation Law, and all penalties, interest and costs added to taxes under the Taxation Law, and

(b) for the purposes of collection and enforcement, all taxes imposed, levied, assessed or assessable under any other local revenue law of the First Nation, and all penalties, interest and costs added to taxes under such a law; and

“valuation” means the determination of the assessed value of an interest in reserve lands.

(2) For greater certainty, an interest, in relation to reserve lands, includes improvements.

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(3) In this Law, references to a Part (e.g. Part I), section (e.g. section 1), subsection (e.g. subsection 2(1)), paragraph (e.g. paragraph 7(5)(a)) or Schedule (e.g. Schedule I) is a reference to the specified Part, section, subsection, paragraph or Schedule of this Law, except where otherwise stated.

PART III ADMINISTRATION Assessor and Assessment Appraiser 3.(1) Council must appoint one or more assessors to undertake the duties of the assessor as set out in this Law or as directed by Council.

(2) Council may designate an assessment appraiser to carry out valuations as set out in this Law.

(3) A person who carries out valuations under this Law must be qualified to conduct assessment appraisals of real property in the Province.

Application of Law 4. This Law applies to all interests in reserve lands.

PART IV ASSESSED VALUE Interests Assessable 5.(1) All interests in reserve lands that are subject to taxation under the Taxation Law and all interests for which payments-in-lieu may be accepted by Council must be assessed in accordance with this Law.

(2) A valuation must be prepared for each assessable property in accordance with this Law.

The law must require Council to appoint an assessor to undertake assessments of assessable property and other specified duties. Assessment Law Standards paragraph 1(a).

Council can decide to appoint an assessment appraiser to carry out the valuations instead of having the assessor carry out the valuations.

Whichever person undertakes valuations, whether the assessor or an assessment appraiser, this person must be qualified to assess real property for taxation purpose in the Province. Assessment Law Standards paragraph 1(b).

The law applies to all interests in reserve lands.

All properties subject to taxation and all properties for which payments in lieu are made must be assessed. The law could also require the assessment of additional properties. Where the properties are taxed based on the taxable area of the property, section 8 of this law applies.

(3) The assessor must prepare an assessment for each assessable property using the valuation prepared for that assessable property.

(4) An assessment must be prepared for an improvement whether or not it is complete or capable of being used for its intended purpose.

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Assessment and Valuation 6.(1) Each interest in reserve land must be assessed as of the applicable base date.

(2) Each interest in reserve lands must be assessed using only mass appraisal.

This section requires property to be assessed as of the applicable base date, which is the base date set by Saskatchewan Assessment Management Agency (SAMA). Assessment Law Standards subsection 2.1.

The rules set out in this and the following subsections reflect provincial assessment practices.

(3) Regulated property assessments must be determined according to the regulated property assessment valuation standard.

(4) Non-regulated property assessments must be determined according to the market valuation standard.

(5) Notwithstanding subsections (3) and (4), the rules for preparing assessments apply to the assessment of all interests in reserve land unless stated to apply only to regulated property assessments or only to non-regulated property assessments.

(6) Land and improvements may be assessed separately in circumstances where separate values are required.

(7) The dominant and controlling factor in the assessment of interests in reserve lands is equity.

(8) Equity in regulated property assessments is achieved by applying the regulated property assessment valuation standard uniformly and fairly.

(9) Equity in non-regulated property assessments is achieved by applying the market valuation standard so that the assessments bear a fair and just proportion to the market value of similar interests in reserve lands as of the applicable base date.

(10) The assessed value must reflect all the facts, conditions and circumstances affecting the interest in reserve lands as of January 1 of each year as if they had existed on the applicable base date.

The law must use the same date that is set by the Province for assessment purposes. Assessment Law Standards subsection 2.1.

(11) The assessed value of land through which a pipeline runs is not to be reduced if the pipeline is buried in the land and the surface rights are not held by the owner of the pipeline.

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(12) Notwithstanding the disposal of lots or plots in a cemetery, the holder of an interest in reserve lands used as a cemetery must be assessed with respect to all the lands included in the cemetery.

(13) After the assessed value of an interest in reserve lands is determined, the assessor must determine the taxable assessment of the interest by multiplying the assessed value by the percentage of value applicable to the property class established under paragraph 7(1)(a) to which the interest belongs.

(14) Except as otherwise provided in this Law, for the purposes of assessing interests in reserve lands

(a) the valuation methods, rates, rules and formulas established under provincial assessment legislation, the assessment manual, and any guidelines established by the agency to determine the assessed value of an interest in reserve lands, existing at the time of assessment, and

The law follows the provincial practice of using taxable assessment, determined by multiplying the assessed value by the percentage of value applicable to each property class established by the Province under the Municipalities Act.