May 16, 1996
(Government Services and Lands)

Implementation of A Market Value Pricing Policy for Crown Land

Ernest McLean, Minister of Government Services and Lands, has announced that government is implementing a new pricing policy for Crown land.

The new policy consists of a combination of fixed rates and fees based on provincial assessment data or fair market value appraisals, and will apply to recreational, residential and commercial leaseholders only. There will be no changes to policy relating to agriculture and aquaculture leaseholders.

"The implementation of this policy will bring the price of acquiring Crown land in line with that of the private sector but the primary objective is to reduce government's costs and regulatory role associated with the maintenance of long term leases," said Mr. McLean. To encourage development and prevent speculation on undeveloped land, initial Crown land allocations will continue to be in the format of a lease or license, with a five year development requirement. This aspect of the policy will encourage timely development and stimulate spin off economic activity throughout the province.

The lease rental will be established at 20 per cent of the set value of the land and upon completion of the development conditions, the lease will be converted into a grant. The yearly rental will serve as a lease/purchase option fee as well as a ground rent if the grant option is exercised within the first five years.

It is also our objective is to create incentives to encourage existing commercial, residential and recreational cottage leaseholders, who have complied with their lease conditions to acquire outright ownership of their land as opposed to leasing it, thereby increasing the marketability of their assets and further removing government administration and regulatory control."

Leaseholders who were issued leases on or before October 31, 1991 will be given until October 31, 1996 to apply for a grant under the current pricing structure.

Leaseholders whose leases were issued after October 31, 1991 will be given five years from the date of issuance of the lease to comply with the lease conditions and apply for a grant.

Those who continue to lease will have their lease rentals increased to conform with the new fee schedule upon the rent review anniversary of their lease (every five years for all non-residential leases).

Contact: Gary Callahan, 729-3142.