A decision by the provincial Property Assessment Appeal Board to reduce the value of B.C. Ferries’ Horseshoe Bay terminal to virtually nothing has resulted in the corporation appealing the property values of its other terminals, including three in Nanaimo.
The move has Nanaimo City Hall on edge as a similar ruling for the terminals here – Duke Point, Departure Bay and Gabriola – would result in a loss of about $1.2 million in tax revenue, about 60 per cent of which goes to the city while the balance goes to the regional district, school board, hospital, library and other agencies.
B.C. Ferries is Nanaimo’s fifth largest single taxpayer. It filed appeals for all of its properties in the province prior to B.C. Assessment’s Jan. 31 deadline.
Last October, the assessment appeal board reduced the assessed value of the upland property of the Horseshoe Bay terminal (not including the marine berth) from $47 million to just $20, citing the land lease requires the property to be a ferry terminal. Because B.C. Ferries is losing money – though that particular route is profitable – a market-based approach suggests the land is worthless.
Since the appeal was launched in 2010, the municipality of West Vancouver may have to pay the ferry corporation back more than $750,000 in taxes.
Deborah Marshall, spokeswoman for B.C. Ferries, said the corporation is trying to reduce its costs while working with municipalities to ensure fairness.
“We want to make sure we can ensure predictability in our property taxes and pay fair and reasonable rates,” said Marshall. “Back in 2003 we paid $1.3 million in grants in lieu of taxes for all of our terminal properties and last year we paid $5.2 million. Any increase in our cost is passed on to our customers so we’re trying to keep our fares as reasonable as possible. But we’re continuing to work with B.C. Assessment to come up with a solution for a fair tax settlement.”
West Vancouver is appealing the property assessment board’s decision, and the municipalities of Nanaimo, Delta, and North Saanich have been approved as intervenors in the appeal.
That appeal is scheduled for October.
“We just found out so we don’t know an awful lot more, only that we’ll be at the table,” said Doug Holmes, Nanaimo’s general manager of corporate services.
Concerned about the loss of tax revenue, Nanaimo Mayor John Ruttan, along with Delta Mayor Lois Jackson, North Saanich Mayor Alice Finall and West Vancouver Mayor Michael Smith, approached Bill Bennett, minister of community, sport and cultural development to request a meeting.
No meeting date has been set, but Bennett replied through correspondence that the decision to reduce the property value of the Horseshoe Bay ferry terminal was “to say the least, unexpected.”
“I want to assure you that the government believes that BCFS, as a private entity, should continue to pay a fair level of property taxes,” wrote Bennett.
Ruttan said discussions are ongoing between all parties and that he is confident a solution can be found.
“The thing for us is certainty,” said Ruttan. “We’re talking about one per cent of our budget and if we lose that we have to find a way to make it up. We’ve had indication from the province that they’re working with B.C. Assessment on it and I’m quite optimistic at this point we’ll find a resolution to the issue.”