FINANCE DEPARTMENT POLICY
Policy number: F-2024-02
Policy name: Sale of Land
Adopted on: September 9, 2024
By-law number: 105-2024
1. POLICY STATEMENT
This policy establishes the guidelines and procedures for the sale of land by The Corporation of the Nation Municipality (The Corporation) to ensure a systematic, transparent, and accountable method for the disposal of Corporation-owned assets in accordance with all appropriate laws, regulations, and accounting standards.
2. PURPOSE
The Corporation is committed to ensuring its assets are safeguarded, tracked, and disposed of effectively and efficiently.
3. SCOPE
This policy applies to the sale and disposal of surplus land and road allowances owned by The Corporation.
4. LEGISLATIVE AUTHORITY
Municipal Act, 2001, S.O. 2001, c.25, as amended.
5. DEFINITIONS
"Abutting" - a parcel of land adjoining another parcel of land having one (1) or more lines in common.
"Act" - the Municipal Act, 2001, S. O. 2001, c .25, as amended.
"Appraisal" - a written opinion/letter of opinion as to the consideration that the Assets might be expected to realize if sold on the open market by a willing seller to a willing buyer.
"Buildable Lot" - land of sufficient size (including frontage and area) to permit the lands to be utilized as an individual parcel of land.
"Chief Administrative Officer" (CAO) - the Chief Administrative Officer of The Corporation.
"Clerk" - the Clerk of The Corporation.
"Council" - the Council of the Corporation of the Nation Municipality.
"Disposal" - the sale or exchange for other assets, or the lease of assets for a term exceeding 21 years, of any portion of The Corporation's surplus assets but does not include the granting of an easement or a right-of-way.
"Land" - Encompasses all types of real estate and property interest, including but not limited to community land, vacant land, operational land, road reserves, any legal interest in land, and any other land-related assets. This also includes all associated buildings and structures whether for community use or operational purposes.
"Sale" - includes the sale, transfer, or conveyance of assets by The Corporation. Sale does not include a Quit Claim Deed made by The Corporation for the purpose of correcting or clarifying title or boundaries of its assets or of assets not owned by The Corporation.
"Surplus Assets" - Land no longer required by The Corporation.
6. RESPONSIBILITIES
Council- Approves this Policy and any amendments.
CAO - Oversees the implementation of the policy and reports to council.
Treasurer - In conjunction with the CAO, oversees the implementation of this policy and manages the financial aspects of the asset disposal.
Department Head - Determines which assets should be disposed of and assesses their value whenever feasible.
7. EXEMPTIONS
This policy does not apply to the following:
- A Disposal of Assets pursuant to Section 110 of the Municipal Act, 2001, (municipal capital facilities).
- Disposals as part of a municipal tax sale pursuant to Part XI of the Municipal Act, 2001 (Sale of Assets for Tax Arrears).
- Disposals conducted pursuant to a Planning Act application or approval, which Disposal is governed by a consent agreement, subdivision agreement, or site plan agreement.
- Disposals to the Crown in the Right of Ontario or Canada, or any government agency or authority; and
- Disposals of an easement to a public utility.
8. PRINCIPLES
Municipal Lands will be sold or disposed of in accordance with this Policy, unless Council passes a resolution to waive the requirements.
No Municipal Lands with water frontage shall be sold unless such sale is for the good of the municipality as a whole.
No municipal road allowances shall be sold unless such sale is for the good of the municipality as a whole.
No Municipal Land shall be sold until examined by the Municipality for the feasibility for potential current needs or future needs.
No Municipal Land shall be declared surplus without taking into consideration Council priorities. Sale and disposition of Municipal Lands will be conducted in a fair and accountable manner.
9. SALE OF ASSETS PROCEDURES
The following procedures shall apply to the disposal of Land by the municipality:
- Commencement Disposal of Land
- Declaration of Surplus Land (except where exempt)
- Determination of method of Sale
- Determination of the value of the Land (except where exempt)
- Determination of sale price
- Notice to the public (except where exempt)
9.1 Commencement Disposal of Land
Land disposal may be initiated in response to public inquiries, unsolicited offers, as the result of internal municipal actions and decisions of Council, or when an asset is deemed surplus or no longer required by The Corporation.
A decision to dispose of an asset should only be made after a benefit and risk analysis of the proposed disposal, including consideration of the following factors with regards to the asset:
- The current market value;
- The usefulness;
- Any alternative future use;
- The annual cost of maintenance;
- The positive and negative impacts the sale or disposal of the asset may have on the community;
- Any cultural or historical significance;
- The long-term plans and strategic direction of the Corporation (for example, meeting the objectives of the Council Plan, Strategic Resource Plan, and Asset Management Plans);
- The results of any community consultation process;
- Any restrictions on the proposed disposal; and
- Any other relevant policies.
Before deciding whether to sell land, the Corporation's council will receive and consider a report from the CAO, the Treasurer and/or the Head of Department involved. The report will include an assessment of relevant factors including those outlined above.
9.2 Declaration of Surplus Land
Land must be declared surplus to the needs of the municipality by by-law or resolution passed at a meeting open to the public.
The passage of a resolution or by-law declaring land to be surplus does not obligate the municipality to dispose of such lands and such a declaration may be rescinded by resolution or by-law at any time prior to the completion of the disposal.
9.3 Determination of Method of Sale
Assets may be sold by public tender, by public auction, by listing with a real estate firm or broker, by offer to adjacent assets owner(s) or in such other appropriate manner as may be determined by the CAO.
9.3.1 Sale By Public Tender
If Assets are to be disposed of by public tender, the following shall apply Costs incurred or anticipated to dispose of the Land such as but not limited to legal fees, survey, Appraisal, encumbrances, administrative fees, advertising, and improvements shall be determined.
An estimated bid amount shall be determined which shall not be less than the appraised value plus the additional costs referred to in Clause i above. Notwithstanding the foregoing, Council may accept an amount less than or higher than the estimated bid.
An advertisement shall be placed in a newspaper or a regular publication that is, in the Clerk's opinion, of sufficient general circulation and/or by posting notice on the Municipality's website. The advertisement shall include a brief description of the Land and shall specify the final date that offers will be accepted and shall include the following statement "the highest or any offer may not necessarily be accepted".
The tender documents shall be delivered in person to the Clerk's office by the date and time specified on the notice. Tenders will be opened in public at the time prescribed on the last date for receiving tenders.
The tender documents shall be accompanied by a deposit of at least 20 per cent of the tender amount, which deposit shall be made by way of money order or by way of bank draft or cheque certified by a bank, trust corporation or Province of Ontario Savings Office.
A proposed Sale or Disposal of Land will not proceed to Council for consideration until after twenty-one (21) calendar days from the date on which the advertisement required by 9,2 .3 above is made.
9.3.2 Sale By Public Auction
If Assets is to be Disposed of by public auction the following shall apply
Costs incurred or anticipated to dispose of the Assets such as but not limited to legal fees, survey, Appraisal, encumbrances, administrative fees, advertising, commission, and improvements shall be determined.
An estimated bid amount shall be determined which shall not be less than the appraised value plus the additional costs referred to in the clause above. Notwithstanding the foregoing, an amount less than or higher than the estimated bid may be accepted.
An advertisement shall be placed on the public auction website and by posting notice on the Municipality's website and social media channels. The advertisement on the public auction website shall include a brief description of the asset and shall specify the minimum bid and the final date that offers will be accepted. The advertisement on the municipal website and social media channels will provide the link to the public auction website.
The bill of sale will be provided by the public auctioneer at time of sale and a copy must be retained by the municipality as evidence of the sale.
9.3.3 Disposal By Listing With A Real Estate Agent, Firm Or Broker
Should Council determine to engage a real estate firm or broker to dispose of the Assets, the following shall apply:
Costs incurred or anticipated to dispose of the Assets such as but not limited to legal fees, commissions, survey fees, valuation fees, encumbrances, advertising and improvements shall be determined.
A listing price shall be determined which shall not be less than the appraised value plus the additional costs referred to in Section 9.4.
The CAO shall be authorized to sign the listing agreement.
The offers shall be submitted to the CAO on a standard offer to purchase form or document drafted by a lawyer.
The Municipality may in its sole and absolute discretion prepare and present counteroffer(s).
All final offers shall be submitted to Council for approval of the Sale price.
9.3.4 Disposal Directly To An Abutting Assets Owner
Should Council determine to sell the Assets directly to an abutting assets owner the following shall apply:
- Costs incurred or anticipated to dispose of the Assets such as but not limited to legal fees, administrative fees, survey, valuation fees, encumbrances, advertising, and improvements shall be determined.
- An estimated purchase amount shall be determined which shall not be less than the valued amount plus the additional costs referred to above.
- Notwithstanding the foregoing Council may accept an amount less than the estimated purchase amount.
- Subject to the provisions of Section 106 of the Act, Council may authorize the Sale of Land for less than the fair market value if in the opinion of Council it is appropriate to sell the Assets for less than fair market value.
9.4 Valuation
Where assets need to be valued, the CAO or the Treasurer shall select a method of valuation from the following, including but not limited to:
- An Appraisal or an opinion by an independent qualified appraiser.
- An opinion of value by a licensed real estate agent; or,
- Such other means as may be specifically determined as appropriate in the circumstances.
All such values shall be determined by an independent third party who does not have an interest in the disposal or purchase of the assets.
An evaluation is not required for the following classes of land:
- Closed highways if sold to an owner of land abutting the closed highways;
- Land formerly used for railway lines if sold to an owner of land abutting the former railway land;
- Land repurchased by an owner in accordance with Section 42 of the Expropriations Act;
- Easements granted to public utilities or to telephone companies;
- Land sold/transferred to another municipality;
- Land sold/transferred to a Local Board including a School Board or Conservation Authority;
- Land sold/transferred to the Crown in Right of Ontario or Canada or their agents.
9.5 Determination Of Sale Price and Terms of Sale
Generally, Land sale price shall be determined in accordance with Section 9.4, Valuation. Where the Lands are exempt from Valuation, the sale price shall be determined by the CAO or delegate.
Council may authorize the Sale of Land for less or greater than the Valuation of CAO's determination of sale price, if in the opinion of Council, it is in the best interest of the Municipality or otherwise fair and reasonable.
All Land, with or without improvements, shall be sold on an "as is" basis unless Council determines otherwise.
Any survey and/or reference plan required shall be obtained at the expense of the purchaser(s) unless Council by resolution otherwise determines.
Council may impose conditions of Sale if deemed appropriate.
The Municipality is under no obligation by virtue of the Sale of Land to grant any approvals, including approvals for changes to the Official Plan or zoning by-law or with respect to the site plan control, minor variances, and building permits, or to support approvals required by any other approval authority, which may be necessary for any contemplated use of the Land by the Purchaser.
9.6 Notice
Before selling the Land, notice of the intent to sell shall be given to the public by at least one of the following:
- Posting notice on the municipal website;and/or
- Posting notice in the local newspaper; and/or
- Posting notice on the municipal website through the Council Agenda.
Notwithstanding the notice provisions above, the CAO or designate may provide additional notice in order the gain maximum exposure.
This notice shall be given at least fourteen (14) days prior to the council meeting which includes this item on the agenda. The notice shall include the following:
- A legal description of the Land, municipal address and location map which is deemed sufficient to identify the lands as well as the date on which the resolution or by-law declared the lands to be surplus was/will be passed;
- Specifications as to where to submit comments;
- Final date for submitting comments;
Notwithstanding the notice provisions above, Council may waive the requirement of a published notice for the sale of Land directly to an abutting asset owner if they deem this appropriate.
Where Land proposed to be disposed falls within one of the categories below, notice to the public shall be deemed to be sufficiently given by including a report dealing with such Disposal as part of the agenda of the Council meeting at which the intended Disposal is to be considered by Council:
- Closed highways if sold to an owner of land abutting the closed highways ;
- Land formerly used for railway lines if sold to an owner of land abutting the former railway land ;
- Land that does not have direct access to a highway if sold to the owner of land abutting that Land ;
- Land repurchased by an owner in accordance with Section 42 of the Expropriations Act.
- Easements granted to public utilities or to telephone companies.
- Land sold/transferred to another municipality.
- Land sold/transferred to a Local Board including a School Board or Conservation Authority.
- Land sold/transferred to the Crown in Right of Ontario or Canada or their agents.
10. DISPOSAL OF BUILDABLE LOTS
When it has been established that a buildable lot is property that is surplus to the municipality's requirements, Council shall establish the purchase price of the buildable lot after reviewing an appraisal prepared for the property to be disposed of. Appraisals may be conducted by either an accredited land appraiser or a licensed real estate agent.
Notwithstanding Section a) above, Council may establish the purchase price of a buildable lot.
The sale may, in Council's sole discretion, be conducted by way of:
- Direct negotiation with the abutting landowners;
- Invitation of tenders;
- Placement with a real estate broker;
- Advertising on the Municipality's website;
- and/or Advertising on the buildable lot.
Prior to accepting offers of purchase, notice for the disposal of a buildable lot shall be by publication once a week for two (2) consecutive weeks in a newspaper having general circulation in the local area and/or on the Corporation's social media sites and/or website. The notice shall advise of the proposed sale and provide information as to where and when comments may be submitted.
11. COSTS
The municipality may require the purchaser to be solely responsible for the municipality's costs incurred to dispose of any Property, which costs may include but are not limited to legal, survey appraisal, removal of encumbrances, advertising and improvements, and administration fees.
12. OFFER EVALUATION, ACCEPTANCE OF OFFERS AND CERTIFICATE OF COMPLIANCE
All bids, proposals and offers shall be presented to Council unless Council has given direction to staff to negotiate the disposition by another method.
Council shall have the authority to determine the successful offer. Council shall pass a by-law authorizing the disposition and directing the Mayor and Clerk to execute an Agreement of Purchase and Sale, in consultation with the Town Solicitor and other appropriate staff as needed.
The Purchaser shall be responsible for paying an administrative fee for the completion of the Purchase and Sale process in accordance with the Town's User Fees and Charges By-Law as may be amended from time to time.
Council reserves the right to accept an offer less than the appraised value including costs where, in the opinion of Council, it is in the best interests of the municipality to do so.
Upon completion of the disposal process and on the recommendation of the Chief Administrative Officer, the Town Clerk shall issue a certificate verifying compliance with the provisions of this Policy in the prescribed form as outlined in "Schedule B"
13. HOUSEKEEPING AMENDMENTS
The Clerk is hereby authorized to make such minor amendments to this Policy as are necessary to ensure continued compliance with provincial legislation and Council-ratified operating procedures.
14. ERRORS OR OMISSIONS
It is acknowledged that any error or omission in following the procedures and policies, which error or omission was not the result of bad faith on behalf of the Municipality, will not render such Disposal invalid or void.
15. POLICY REVIEW
The CAO and/or Treasurer shall review the effectiveness of this policy at least every five (5) years to ensure that it is aligned with current best practices and legislative requirements. The result of this review, along with any recommended changes, will be reported to Council for approval. Unless circumstances indicate that a review is required.
16. EFFECTIVE DATE
This Sale of Land Policy shall take effect on August 12, 2024 and shall replace any former policies in place.
17. ATTACHMENTS
Schedule A: Certificate of Compliance Template
Schedule B: Proposal to Purchase Municipal-Owned Lands Application