McMaster University was exempted from paying $10,350 in 2023 municipal property tax and is appealing a portion of the $9,736 in taxes assessed in 2022 for the vacant house at 30 South St. W. in Dundas — a former childhood home of Sir William Osler.
The property was listed for sale by McMaster in May, and the listing was removed the week of Nov. 27. Three months ago, the university reduced the asking price by $251,000 to $2.99 million.
“The listing has been suspended for the winter and will be re-listed in the spring,” McMaster spokesperson Gillian Earle said on Nov. 28. “The university is ensuring the property is maintained and secure.”
She said McMaster has a “statutory exemption from property taxes for lands owned, used and occupied by the university.”
Earle said until the property is sold it will “continue to be used to store university assets and for other uses as determined by the university.”
She confirmed no one is living in the home, it is not being rented for residential use, and it is not currently being used for classrooms or offices by McMaster.
According to City of Hamilton spokesperson James Berry, the province’s Municipal Property Assessment Corporation (MPAC) exempted the property from municipal taxes for 2023 under a section of Ontario’s Assessment Act which states: “land owned, used and occupied solely by a university, college, community college or school … would be exempt from taxation if it was occupied by the owner.”
Berry said a notice from MPAC exempting the property for the 2023 taxation year was processed by Hamilton taxation staff on June 27.
“The property is currently taxable — not exempt — for the 2021 and 2022 taxation year, however, the city is in receipt of a Municipal Act tax application for exemption for the latter part of 2022, citing the property commenced to be solely used and occupied by the University,” Berry said. “This application is expected to be included in the next Municipal Act appeals meeting, scheduled for December 14.”
He said applications are normally reviewed by MPAC and City of Hamilton taxation staff in consultation with the city’s legal department, and city staff present a recommendation.
“If staff are recommending exemption for the latter part of 2022, it would be in adherence to the same section of the Assessment Act,” Berry said.
McMaster bought 30 South St. W. for $2,818,200 in January 2021.
Sellers Sara Burnet-Smith and Gary Fincham continued operating Osler House Bed and Breakfast there until October 2022. Their lease with McMaster ended the following month.
Wendy Parke, spokesperson for MPAC, said the corporation determined in a recent review that the property is “owned, used and occupied solely” by McMaster University.
“The university confirmed it was using the property for storage and general meeting space for various campus groups during the review,” Parke said. “Therefore, it qualifies for property tax exemption under the provisions of the Assessment Act.”
The property’s current municipal zoning does not specifically permit classrooms or offices, and the university is not using the building as a residence, bed and breakfast or retirement home — the permitted uses.
Parke said the property meets the act’s requirements for municipal property tax exemption, even if uses do not conform to the existing zoning.
“The act does not require a conforming use, nor preclude properties with a nonconforming use,” Parke said.
Within a month of taking over the property, McMaster announced on Dec. 2, 2022, it would list the property for sale.
The university listed it on May 4, 2023, for $3.25 million, an increase of $431,000 over the $2,818,200 it paid for the property in January 2021.
The property is assessed by MPAC at a value of $978,000 for municipal tax purposes.
Although McMaster University is exempt from property tax it is paying the city $2,569,200 this year in payments in lieu of taxes (PILT) calculated by Ontario’s Ministry of Municipal Affairs and Housing using the institution’s capacity figures multiplied by a regulated rate of $75 per “head or bed.” It’s not clear if it is specifically included in that calculation.
Also this year, McMaster is paying the city PILT of $2,700 for McMaster Divinity College and $48,525 for its Mohawk College nursing program.
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