BC Assessment’s proposed changes to its pipeline valuation model are receiving more pushback as local governments brace for substantial losses in tax revenue that would result if the changes come into effect next year as planned.
The Thompson-Nicola Regional District (TNRD) board of directors has written a second letter urging the Minister of Finance to formally request that the proposed changes to pipeline assessments be immediately postponed, until local governments can be engaged in a “thorough consultation process to ensure fairness and transparency,” the TNRD said in a press release.
Pipeline companies in B.C. are in line to have their property taxes reduced by millions of dollars if the assessment changes go through, with regular taxpayers having to make up the difference. The Conservative Party of B.C. has decried the move, calling it a “backroom deal” that will benefit billion-dollar companies at the particular expense of rural communities that have pipelines running through them.
Where the TNRD is concerned, that tax impact would amount to about $1.3 million in losses annually, the regional district said.
The TNRD is calling for the proposed assessment changes to be postponed by at least a year to give local governments time to adapt their budgets accordingly.
The latest letter was submitted to the ministry following a committee of the whole meeting on Dec. 12, where the board received a detailed report from TNRD staff about the tax impact of BC Assessment’s planned pipeline valuation changes. The board had previously sent a letter on Oct. 23, when preliminary tax information was available.
During the Dec. 12 staff presentation, it was revealed that if BC Assessment’s changes to pipeline values are implemented in 2026 as proposed, there would be substantial impact to the TNRD and the Thompson Regional Hospital District (TRHD) budgets for the foreseeable future, “unfairly shifting the tax burden” onto other property owners, the regional district said.
According to the TNRD, the changes would shift 3.3 per cent of the tax requisition for its 2026 budget, and would shift 1.7 per cent of the tax requisition for the TRHD budget.
The total amount of property taxes being shifted from pipeline companies to residential and business properties in the TNRD would be about $1.3 million each year beginning in 2026, the TNRD said.
“Proposed changes by BC Assessment to the value of pipelines would have substantial negative impacts for TNRD residential and business taxpayers, and consultation with local governments has been severely lacking,” said Barbara Roden, TNRD board chair.
Roden added that there was no early warning about the assessment change from BC Assessment, which leaves the regional district and local governments scrambling.
“Our board understands that these proposed changes have been under review for many years; however, local governments were only informed of the process in September,” she said. “The abrupt notice provided by BC Assessment for changes of this magnitude is not sufficient for local governments to reasonably adjust their budgets and ease the anticipated tax burden that this now creates for residents and businesses.”
The TNRD said it understands that BC Assessment is planning to review valuation of other large-scale utilities, including railways, and it has informed the TNRD that this could increase the value of other properties within the utilities tax class and offset negative tax impacts for residential ratepayers.
“Given the apparent imminent plan for BC Assessment to do this wider review, the TNRD asks that the status quo valuation of pipelines remain in effect for at least one additional year, which BC Assessment has had in place since 1986,” the TNRD said.
Small communities with pipelines running through them are expected to be hit hardest by the reduction in pipeline values.
The District of Clearwater, which has the Trans Mountain pipeline running through its borders, has estimated its impact next year to be in the range of an eight per cent loss in taxation, totalling about $250,000, or $100 for every person living in Clearwater.
Mayor Merlin Blackwell previously lamented the fact that he’d only been given notice of the proposed change in September.