Cannabis drives drop in Delta farm assessments Assessment values dropped across the province

by PETER MITHAM DELTA – The overall value of

farm properties on the BC tax roll fell yet again this year, but one of the greatest declines in the Lower Mainland was very likely due to cannabis. BC had 51,000 farm

properties worth $1.25 billion on the valuation date of July 1, 2018, according to BC Assessment Authority data published with the release of assessment notices on January 2. The total dropped 2.6% compared to a year earlier. Assessed values of farm

properties reflect soil capability and other factors, and are lower than every other property class. The greatest decline

occurred in Vancouver, which saw its relatively small stock of farm properties drop 29% to $147,264, followed by Vancouver Island, which saw values fall 5%. The third-greatest decline

occurred in Richmond-Delta, where many blame residential construction for the loss of farmland. The area saw the assessed value of farm properties decline 4% to $70 million.

But the chief culprit isn’t

residential builders in Richmond at all, explains Brian Smith, a deputy assessor with BC Assessment in Langley, but cannabis.

Delta has seen millions of

square feet of greenhouses converted to cannabis production over the past 18 months. Conversions here have led the Lower Mainland, where cannabis industry sources estimate approximately 10 million square feet of greenhouses will eventually grow cannabis. And cannabis revenues

don’t qualify for farm class status when it comes to BC property taxes, according to an October 2018 amendment to the province’s “Classification of Land as a Farm” regulation. “We’ve had a large number

A decline in the assessed value of farm properties in Delta is being attributed to large vegetable greenhouses like Village Farms converting their operations to cannabis production. SEAN HITREC FILE PHOTO

of previous greenhouses that have been converted to cannabis operations. Cannabis growth does not qualify for farm class,” says Smith. “A good chunk of those values in the minus component is related to that. … That includes the land and improvements associated with the operation.” Smith says the residential

portion of farm properties farmed by leasehold farmers is part of the residential roll, so new development on such properties wouldn’t affect the roll of farm properties. “A house is a house, and falls under Class 1,” says Smith. Properties that qualify for farm class status must generate specific revenues according to size. Properties less than 1.98 acres must generate revenues of $10,000; larger properties, up to 10 acres, must generate revenues “Farmers helping farmers with their real estate needs”

of $2,500. Properties larger than 10 acres must generate sales of $2,500 plus 5% of the assessed value of the land in excess of 10 acres. The threshold is hotly contested. While the BC Agriculture Council is among the groups that would like to see the qualifying income boosted to $25,000, groups representing smaller growers say this would unduly favour large commercial farms and put small-lot farmers at a disadvantage. Smith says the need to

demonstrate sufficient sales may be responsible for the larger decline in the roll of farm properties on Vancouver Island.

While all farms are

reviewed on a regular basis, smaller farms whose income just meets the requirements may lose farm class status unless they make annual income declarations by October 31. Vancouver Island is home to the greatest proportion of farms with incomes of $10,000 or less of any jurisdiction in the

province at 59%. “To ensure the integrity of farm class, we want to ensure that we’re granting farm class to the people who are actually farming and meeting the legislative requirements,” he says. “We may want more regular updates on that income.”

Smith says that property

owners can claim farm class status for properties on the 2019 roll at any point in the 2019 calendar year, and the assessment will be revised accordingly.


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