Third Session, 42nd Parliament

(2022) OFFICIAL REPORT

OF DEBATES

(HANSARD)

Tuesday, October 4, 2022

Afternoon Sitting

Issue No. 224

ISSN 1499-2175

The HTML transcript is provided for informational purposes only.

The PDF transcript remains the official digital version.

CONTENTS

Routine Business

Introductions by Members

Orders of the Day

Committee of the Whole House

Bill 26 — Environmental Management Amendment Act,

Hon. G. Heyman

R. Merrifield

E. Ross

Report and Third Reading of Bills

Bill 26 — Environmental Management Amendment Act,

Second Reading of Bills

Bill 28 — Municipal Affairs Statutes (Property

Taxation) Amendment Act, 2022 (continued)

B. Bailey

D. Ashton

A. Singh

B. Stewart

R. Russell

R. Merrifield

M. Dykeman

T. Stone

Hon. R. Fleming

T. Wat

Hon. G. Chow

B. Banman

T. Shypitka

Hon. N. Cullen

TUESDAY, OCTOBER 4, 2022

The House met at 1:32 p.m.

[Mr. Speaker in the chair.]

Routine Business

Introductions by Members

R. Russell: I’d like to introduce to the House…. We have our government agent — I

think you’re still the government agent — Gina Burroughs, as well as her

partner, Vince Burroughs, here.

I’m happy to welcome you to the House.

They were both — well, Gina, particularly — huge champions for our

community during the floods of 2018. So thank you.

She’s here for the Long Service Awards for public service, taking

place tomorrow. I believe it’s 25 years. Is that right?

Please make them feel welcome.

Orders of the Day

Hon. M. Farnworth: In this chamber, I call committee stage, Bill 26.

Committee of the Whole House

BILL 26 — ENVIRONMENTAL MANAGEMENT

AMENDMENT ACT,

The House in Committee of the Whole (Section

B) on Bill 26;

S. Chandra Herbert in the chair.

The committee met at 1:34 p.m.

Hon. G. Heyman: I’d just like to introduce staff who are here with me — Chris

Doyle, acting chief conservation officer.

On clause 1.

R. Merrifield: I just wanted to start off, with my first question, by talking

about the conservation officers.

[1:35 p.m.]

Obviously, the minister did a fantastic job yesterday of

explaining, in detail, what their jobs are, what their jobs entail and

how great they actually are, which we all agree on. My question is: when

were the changes that were made back in 2019 first acknowledged by the

minister or understood by the minister?

Hon. G. Heyman: I’d just like to ask the member for clarification. Obviously, I

introduced the changes. I’m wondering if the member means…. When did we

realize they needed further amendment, or…? Okay. Thank you.

The problem first became apparent…. I can’t be absolutely sure of

the date, but it was likely in 2020, when the first conservation officer

went for a detention order and realized that it was not for the full 12

months that it had been previously. Then staff had to go through the

process of getting time with leg. counsel to draft the amendment and

getting time on the legislative calendar to bring it forward. At the

point at which the request for legislation was ready…. That’s when it

was first raised to my attention.

R. Merrifield: If it was brought to the minister’s attention first in

2020….

Okay, the minister is making gestures. So I’ll rely on the

minister to change what was being said there.

It was brought to awareness in 2020 when the first conservation

officer actually went forward and was only given a three-month, rather

than a 12-month, warrant. Then it went through the due

process.

Could the minister please describe a little bit more of what that

due process was and why this bill wasn’t brought forward

sooner?

Hon. G. Heyman: In response to the member, the first request for legislation was

prepared in 2020. Then it be­came a matter of the many pieces of

legislation that were priorities for the government to bring forward in

the subsequent legislative sessions.

While I spoke at some length about the administrative problems and

some of the ways time could have been better spent and will be better

spent, we didn’t lose any of our authorities, although a possibility, as

I noted yesterday, did exist that a judge might at some point decline to

give an extension. We didn’t expect that would be likely, and it, in

fact, didn’t happen. Certainly, it’s an administrative problem we wanted

to fix.

[1:40 p.m.]

In terms of the decisions that are made about the legislative

priorities on the calendar, those are made on a range of issues, many of

which are addressing issues for which there is no legislation or any

authority. Those took precedence in the calendar.

R. Merrifield: Yesterday, in the minister’s comments in opening this bill, we

heard detailed analysis of the time and the inefficiencies that were

created through this omission. We also heard details of everything that

a conservation officer actually has under their purview to do, including

the sustainability of our environment, the education of our next

generations and the education of our communities.

In this era of such a climate emergency and with such heightened

awareness of how we need to steward our environment, I find it difficult

to understand why we are waiting three years for this type of amendment.

The good news is that all of the extensions were granted, but I will ask

the minister: was there an opportunity to bring this forward

faster?

Hon. G. Heyman: I appreciate the concern that the member has for the activities of

the conservation offi­cers, and I totally agree, as I stated

repeatedly yesterday, that they have important work to do. Anything,

even an hour out of their day preparing material to seek an extension,

is an hour they could have spent doing other more important things,

which of course is why we brought the bill forward.

I would say many of the initiatives that were brought forward over

the last two years — I’m sure the members of the opposition would agree

— were extremely high-priority as well. There were many issues being

dealt with by my ministry and the climate action secretariat on climate,

specifically, to ensure that we had full development and modelling of

plans to address the impacts of climate change.

In terms of my having an opportunity to bring this forward more

quickly, it is not up to a minister in any government to set the

timetable of government’s legislative calendar as a whole. That’s a

decision that is determined collectively and that ultimately is managed

by the House Leader.

R. Merrifield: Just to help my understanding…. Forgive me; I’ve only been here

for two years, so I don’t have the full complexity, but the two years

span two of the three years of this omission. I’m trying to recall or

remember….

I’ve only been in this critic role for a short amount of

time. Perhaps, could the minister please just refresh my memory? Which

environmental bills have actually superseded or taken precedence over

this amendment for the conservation officers?

Hon. G. Heyman: I’m going from memory, so if I if I miss a bill that came in since

2019, my apologies. I’ll ensure that I give the member the

information.

[1:45 p.m.]

To the best of my recollection, following 2019, when we also did

the Climate Change Accountability Act, the only bills that were brought

forward were amendments to the Parks Act and Protected Areas Act —

amendments that are regularly brought forward to the House. The member

asked it in the context of which bills I considered more important than

this. Again, I would say that I consider all bills from the ministry

important.

If I were allowed to bring them all forward as soon as I thought I

was ready to bring them forward, I would likely do so, as would any

minister. But it doesn’t work that way.

First of all, we have to have

legislative counsel draft bills. If legislative counsel are busy

drafting other bills, which they often are — in fact, they always are —

there is a lineup for their services. It is an overall determination of

government as to what the priorities are.

Then, of course, as I’ve already said, it is ultimately the House

Leader, acting on the broad priorities of all of government, as

determined by cabinet and the Premier’s office, that sets the

legislative calendar.

R. Merrifield: I know that I asked the minister an unfair question. It was like

asking which of your children is your favourite. I mean, they’re all

your favourites. Yes, of course.

I don’t mean that. I actually am concerned. I’m trying to draw

attention and maybe sound the alarm bell a little bit in the middle of

all of these climate emergencies, coupled with the floods and the fires

and the landslides, on top of some of the infrastructure that failed

during those times. I welcome the fact that we did do the Parks Act

amendments. I got to ask the Minister some questions about one of those,

because those parks were so important to British Columbians during that

time, as are the conservation officers so needed as a form of protection

of our environment during this time.

I was trying to quote here. The minister just said that it’s the

“overall determination of government” on what the priorities are. One of

the criticisms about where we’re at with CleanBC and the Roadmap to 2030

is that they don’t have legislative teeth. There isn’t enough momentum

behind them. Could the Minister just describe how this bill takes

precedence over others that could actually be used to move our

environmental sustainability and protection forward?

Hon. G. Heyman: Thank you to the member for the question. First of all, the role

of conservation officers on a range of things is very important. A small

subset of what they do could be directly related to climate, but

generally, it is protection of humans, it’s education, it is protection

of wildlife, and it’s protection of the environment from environmental

harms that could be performed in a variety of ways. I suppose a couple

of those could be related to climate change, if they had to do with

burning or fires.

I think the member’s question was kind of the reverse of the

previous question: on why I, as minister, don’t consider that some

further legislation on climate is more important than this bill, and

premised on an assumption that a criticism of CleanBC is that it doesn’t

have enough teeth. That’s a criticism that…. It’s fair for people to

have opinions and critique actions, but I believe that we have a very

thorough climate plan.

[1:50 p.m.]

We have a number of pieces of legislation that support that, such

as the Zero-Emission Vehicles Act, the low-carbon fuel standards act.

When we created the Roadmap to 2030, we outlined a number of places

where we saw a huge potential to reduce emissions and that we would do

some of that by incentives, some of that by regulation, some of that by

policy and some by legislation.

A number of those pieces of legislation that are potential exist

in other ministries, primarily the Ministry of Energy, Mines and Low

Carbon Innovation. Work to create those pieces of legislation is

actively ongoing and involves consultation with industry, consultation

with the public, consultation with Indigenous people, which is

critically important, in general, but also because it’s required by our

own Declaration on the Rights of Indigenous Peoples Act.

Work on necessary pieces of legislation is ongoing. Of course, we

have said — I have said many times, as the member herself has said —

we’re in a climate crisis. We have a good plan, and we need to not let

up in our implementation of that plan. We need to ensure that all of the

measures that we’ve outlined and that we say can successfully help us

meet our targets are implemented in a timely manner in order for us to

do that, not simply wait to two minutes until 2030 and then bring in a

bunch of changes and say: “We’ve met our promises.”

E. Ross: I’m happy to speak on behalf of Skeena, talking to Bill 26, the

Environmental Management Amendment Act, 2022.

First, I’d like to start by saying congratulations to the minister

for talking two hours yesterday on basically one section. That’s quite

the skill. That’s the designated speaker’s job, for those millions

watching at home. But it was quite impressive.

For the record, so everybody understands what we’re talking about,

the one

section we’re talking about is

section 107.1 of the

Environmental Management Act. I won’t go through the rest of those

headings. But subsection (a): “in subsection (1) by striking out

‘anything seized by a conservation officer under

section 107.02 or

107.03 (2)’ and substituting ‘anything seized by a conservation officer

under

section 107.02 or 107.03.’” And (

b) is: “in subsection (3) by

striking out ‘anything seized in a search under section’” blah, blah,

blah…. Okay, done.

Then the second one is just basic commencement, saying that this

act comes into force on the date of royal assent. That’s what we’re

talking about here today.

I was quite interested for the last five years listening to the

government talk about their commitments to UNDRIP. We heard the minister

talk about it yesterday in his speech regarding Bill 26, and we just

heard him mention it just now in an answer to my colleague from

Kelowna.

So we’re talking about seizing — anything seized by a conservation

officer. And just to keep it in general terms for a second, I was the

chief councillor of Haisla from 2011 to 2017, and I was quite shocked

when I found out that my public works people would not shoot a grizzly

bear that had taken up residence in my community. They were actually

living behind our convenience store right in the heart of our

community.

It took two weeks before a conservation officer would respond. Two

young grizzlies freshly kicked away from their momma bear, and the

conservation officer wouldn’t do anything about it. It took a letter

from me saying: “If you don’t do anything about it, I’ll do something

about it myself, because my public works people are afraid to do

anything about it.”

It has direct relation to what we’re talking about here, because

my public works guy wouldn’t do it, even if there’s a designated

shooter, because previously when they have done it, the conservation

officer seized his rifles. He never got them back.

[1:55 p.m.]

Yet this goes back, historically, to a time when my community

members, the leaders, would go to the local watershed that was about

seven miles away, and they’d monitor the grizzly bear population. When

they saw it was getting too much, they’d start killing grizzly bears. So

in terms of making everything right with UNDRIP and this vague idea of

Aboriginal rights and title in today’s context, that was lost, where we

lost the ability to manage black bears, grizzly bears — not only in

neighbouring watersheds, but also bears that have taken up residence in

our community.

Just in the last two days alone, in my community of Kitimaat

Village where I live right now, a grizzly bear has been living in a new

subdivision. Two black bears are living in our community. People are

scared, and our council is powerless. They have got to wait for the

conservation officer, and who knows how long that will take.

When I’m hearing the minister talk about UNDRIP and the

relationship with Aboriginals, and we’re talking about seizing —

anything seized by a conservation officer — has there been any talk

about what Aboriginal leaders can do on reserves, proactively, in terms

of the management of a grizzly bear population or a black bear

population? If that conversation hasn’t happened, have there been any

conversations happening around community leaders having the ability to

keep their own community safe, autonomously and away from the

conservation laws that we’re talking about here today?

[2:00 p.m.]

Hon. G. Heyman: Thank you to the member for the question. First of all, without

having more detail on the particular instances the member raised, I

can’t comment much, except to say that if a community, Indigenous or

otherwise, feels that there is a threat that is not addressed by the

conservation officer service in a timely manner, it should certainly

seek a meeting with the conservation officer service, the area

supervisors and, ultimately, potentially with senior staff from the

ministry or with me to see if we can work something out.

I have lots of conversations at UBCM and, potentially,

conversations at gatherings of the First Nations Leadership Council with

communities about how they can be better served. I’ll just put that out

as a general comment.

We have different discussions and relationships with different

nations around managing wildlife, around auth­orities in some

cases. We, as I said yesterday, strive to have more Indigenous recruits

in the conservation officer service and to train them. However, unless

there is this very specific funding arrangement that is provided, a

trained conservation officer from a nation would not necessarily be

resident in that nation’s territory specifically.

However, there are arrangements with some nations around that,

that have their own police services to apply for and get, I believe,

special conservation officer status. That has happened and could happen.

In other cases, there are certain authorities under the Wildlife Act to

act to protect communities against a threat from an animal, and all of

those could be explored. Probably this isn’t the best place to explore

them in depth, but we could discuss that further if the member

wanted.

Finally, it is a work in progress. We have discussions with a

number of nations around how we can collaboratively manage parks and

protected areas, how we can collaborate on their guardian programs and

align the work of the guardians with the work of conservation officers

so that they’re working together. Those discussions may evolve to

different forms of recognition of Indigenous Guardians or Indigenous

officials with certain authorities that currently rest with the

conservation officer service.

I’ll simply finally say that if there is an immediate threat — and

I know the member talked about bears that are resident in the community

— that would then be a matter of “is that an immediate threat?” as in

somebody was charged and being attacked, for which they were defending

themselves. Or is it a potential that the community wants to address and

alleviate?

In any case, it would be our goal — the conservation officer

service’s and mine — that there be a quick response to calls and issues

that are raised. I’m happy to discuss that further, directly.

[2:05 p.m.]

E. Ross: Well, that contradicts the conversation I’ve heard for the last

five years in this House. That actually contradicts what I just heard

yesterday in your speech and your answer you gave, previous to my

answer, to my colleague from Kelowna, because all I’ve been listening to

was this new relationship under UNDRIP and all those rights and

principles under UNDRIP.

Really, what I’m hearing now, in terms of a leader like myself

having the right to protect my community being taken away…. Lord knows

when…. I don’t know when that right got taken away.

Whereas, if I went

out and I shot a grizzly bear on my reserve, my rifles get taken away.

Maybe I get charged, and to add to that, that’s on reserve, where the

province is not welcome, in most cases. The province has no jurisdiction

on reserve.

I don’t really know how this law came about where the conservation

officer…. I understand maybe a law of general application, but UNDRIP

doesn’t mention that. Basically, what we’re talking about now is that a

historical right to protect the community has been taken

away.

We can talk about re-establishing that right, but only if that

authority is granted by the Crown, in cooperation with the Crown.

Somehow the government has got to be a part of it, to grant that

authority to a First Nation leader to look after the safety of the

community — even though that community, historically, understood how to

protect their own communities, and that was through wildlife management,

brutal as it may seem.

We’ve been living with wildlife forever. It’s not new to us.

What’s new to us are the laws that restrict us from protecting our

community members.

So to keep the question simple, then, without getting into this

long years and years of negotiating some type of authority granted by

the Crown: if a First Nations leader shoots a grizzly bear on reserve to

protect their community, will that community leader have their rifle

confiscated by the Crown?

Hon. G. Heyman: The Wildlife Act gives people the right to kill an animal to

protect their own life or to protect domestic animals. So if that could

be demonstrated that that was what happened, then that would be within

the provisions of the Wildlife Act.

The Chair: Shall clause 1 pass?

Interjection.

The Chair: Sorry. Clause 1 is the question, and then we would be on

clause 2, and that’s the act.

So no questions on clause 1?

Okay, so that’s moved on, then.

Clause 1 approved.

On clause 2.

[2:10 p.m.]

R. Merrifield: I apologize for my confusion.

Annually, how many search warrants are issued under

section 107.02

of the Environmental Management Act?

The Chair: Just to be clear, clause 2 is just the commencement. Clause 1,

I think, is what the member is hoping to ask questions about still,

which is why I asked if there were any questions on clause 1. But if

the member does still have questions on clause 1, I don’t want to

limit that. If there’s unanimous consent of the House, we can reopen

clause 1 so we can go back to questions on that. Is that what the

member is hoping for?

R. Merrifield: Yes.

The Chair: It is. Okay. To be clear on the terminology we use here,

clause 1 is the one that says “No. 1.” Some peo­ple refer to

it as

section 1, but clause 1,

section 107.1, is what we’re

discussing here, and we call it a clause because it hasn’t passed

into law. If it was a law, then it would be a section.

I’m seeking unanimous consent to reopen clause 1, as there are

some questions still.

Leave granted.

On clause 1 (continued) .

The Chair: Okay, so we’re back to clause 1, and I return to the member

for Kelowna-Mission.

R. Merrifield: Thank you, Chair. Would you like me to re-ask the

question?

The Chair: That would be ideal.

R. Merrifield: Perfect.

Annually how many search warrants are issued under

section 107.02

of the Environmental Management Act?

Hon. G. Heyman: It is hard to put an exact number on it for a couple of reasons.

It varies from year to year. I would say a couple of dozen might be a

reasonable average. One investigation may, in fact, involve several

warrants. But to get a precise answer, I’d have to go and do some

research in records, which we could wait to have happen now, or I could

simply provide the information later — whichever the member would

prefer.

R. Merrifield: If the Minister could provide it at a later date, that’s fine. I

don’t need any searches right now.

My next question is: annually, how many warrantless searches in

exigent circumstances are conducted under

section 107.03(2) of the act

and under

section 107.03(3) of the act?

Hon. G. Heyman: In terms of searches of homes, the acting chief conservation

officer is not aware of any warrantless searches in that circumstance.

But there are frequent searches in the course of the daily work of

conservation officers. That might be a search of a car. It might be a

search of property. It might be a search of a camp.

[2:15 p.m.]

Those would be recorded in reports, but they wouldn’t have been

aggregated at this point. Again, we could do that. It would take some

work to do that, but there would be a considerable number, because that

would often be…. If there was any report that there was a suspicion of

wrongdoing or poaching or whatever, attending to that would involve some

form of search and investigation.

R. Merrifield: Could the minister describe, just in generalities, what that

number would look like? Just an order of magnitude perhaps, if that’s

possible?

Hon. G. Heyman: First of all, searches happen under not just the Environmental

Management Act but under a number of pieces of legislation, including

federal legislation. I think all we can say at this point is that it’s a

regular occurrence. But to try to ballpark a number, I think, would be a

disservice, because without actually digging through huge piles of

reports from all the conservation officers in the province, we’d be just

throwing a number in the air.

R. Merrifield: I guess what I’m attempting to ascertain is just when the minister

says it’s a regular occurrence. It’s frequent? It’s many? We’ve got

24-ish on the 107.02. Is it 30? Is that a regular occurrence? Or is it

300? Is it 3,000? Is it 30,000? I’m just looking for an order of

magnitude on that.

Hon. G. Heyman: It’s very difficult to answer the member’s question, because an

officer may be investigating, and in the course of that, they find

something. Is that a search? Is that something going to be seized? Let’s

just say that there are about 160 conservation officers on the job, and

most days, they are out doing their job.

Some of doing their job may be a human-wildlife conflict, which

doesn’t involve an investigation. It involves addressing the conflict.

Much of their work is called out to investigate, and they would be

conducting the investigation. It’s just hard to…. The member is really

asking me to guess, and I just don’t want to do that.

R. Merrifield: I’m going to ask this next question, and if the answer is the

same, then the answer is the same. I’ll just ask the minister to perhaps

dig down and get some of this information for me. For those warrantless

searches that occur, not knowing the number of them, under 107.03(2),

where delayed to “obtain the warrant would result in a danger to human

life or safety,” how often does a search result in the seizure of

something?

[2:20 p.m.]

Hon. G. Heyman: Again, we could determine that number, but it would take a

considerable amount of work and staff time. It would involve going

through all of the reports of all of the searches to see which ones

resulted in seizures.

R. Merrifield: I don’t want to be assumptive in any way. So I’m going to ask the

minister…. For the warrantless searches that occur under

section

107.03(3), where a delay to “obtain the warrant would result in the loss

or destruction of evidence….” How often does such a search result in the

seizure of something?

[2:25 p.m.]

Hon. G. Heyman: I’m not sure the member asked this. With respect to

section

107.11, the question being where there’s a danger to human life or

safety…. How often is there a warrantless search? Almost never is the

answer to that. Where it does occur is where a delay necessary to obtain

a warrant would result in a loss or destruction of evidence. That

happens much more often.

I don’t have the figure today. If the member wants to know the

answer, it will take some work to get it. If the member wishes us to do

that, she can let us know, and we will ask the sergeants in each zone to

review their exhibit reports and give us the number. I’ll leave it to

the member to determine if she wishes us to ask the conservation

officers to spend time doing that review work to answer the

question.

R. Merrifield: What percentage of cases would the conservation officers have to

go back to court for extensions on?

Hon. G. Heyman: If the consideration is that material is being prepared for a

recommendation to Crown counsel for charges, almost every case, if not

every case, would require an extension. Three months would simply not be

enough time. If there is a different outcome, and on review of the

information and the material a decision is to deal with it in some other

way — for instance, writing a ticket or issuing a fine…. Many of those

could be completed within the three-month period of the initial

seizure.

R. Merrifield: When the minister refers to “many”…. A ballpark percentage of how

many of those would be resolved within that three-month time

frame.

[J. Tegart in the chair.]

Hon. G. Heyman: Again, we’re ballparking. The majority of cases, let’s say

somewhere around 60 percent but not a precise 60 percent, would be

capable of being resolved within the three-month period. They are not

going to proceed with building a case for charges for Crown counsel.

They’ll be dealt with by administrative fines or tickets.

The Chair: Member.

[2:30 p.m.]

R. Merrifield: Thank you, Madam Chair. Nice to see you.

During second reading comments, the Minister stated that the

conservation officers frequently end up having to go back to court,

sometimes as many as three times, before the 12-month mark in order to

get extensions. The Minister has indicated…. I won’t hold the minister’s

feet to this number, but we’re talking a majority, 60-ish percent, of

those would need to be amended and extended.

Since the 2019 amendments were made, which resulted in this

inadvertent omission that we’re amending under this current bill, how

many times has a conservation officer had to go back and actually get

this extension?

Hon. G. Heyman: I think the context in which I was addressing the issue during

second reading was the context of preparing charges, which is, of

course, the instance where I’ve indicated that three months is usually

not adequate. To give a number, we would have to go through all of the

case files of charges and recommendations that were being prepared for

Crown counsel and see how many of those required an extension request.

That would be, basically, a laborious review.

R. Merrifield: To the Minister: how often is there, then, an application made to

detain seized items beyond one year?

Hon. G. Heyman: Again, we don’t have the number in front of us, and we would have

to review files to determine the number. But I think it’s fair to say

that it is less frequent that an extension that exceeds 12 months would

be required.

R. Merrifield: So we don’t know how many searches result in seizure under

107.03(2) or 107.03(3) or even have a ballpark, really. We don’t know

what percentage of cases…. We have 60-ish percent that actually go for

extensions. We don’t know how many of them since 2019 have actually gone

for extensions, and we don’t know how many of the items have been

extended past a year.

My question is this. How does the minister understand this to be

an issue? Maybe I’ll reframe it in just a little bit of a different way.

How did the minister’s staff present him the urgency or priority for

this environmental bill?

[2:35 p.m.]

Hon. G. Heyman: I think, in answer to the member’s question, the context here is

that we’re correcting and restoring to 12 months the period that

previously existed before a drafting error in 2019 included the mention

of a subsection of 107.03(2) instead of all of 107.03.

What we’re talking about is the number of cases where material for

prosecution is being prepared so Crown counsel can consider whether to

lay charges. In most of those cases, three months would not be an

adequate time frame to hold evidence, and, therefore, work has to be

done to prepare an extension request and notify the person whose items

were seized so that they can appear and make a counter-argument if they

want.

But those cases are precisely the most serious cases — the ones

where material for prosecution is being gathered and prepared. The ones

that aren’t as serious are the ones that can be dealt with without

preparing material for prosecution. So, in that sense, ensuring that we

correct the administrative drafting error and restore the 12-month

period is important because it deals with important, serious

cases.

R. Merrifield: The importance, then, is not on how many times this occurs. The

importance that the minister sees is on the severity of the cases in

which this 12-month extension is necessary.

Did I understand that correctly?

Hon. G. Heyman: I think I would say the importance is partly related to the fact

that where extensions are required — because three months is not an

adequate amount of time and 12 months likely will be, although not in

every case — those are the more serious cases, the ones that involve

serious infractions or where preparing material for potential

prosecution for Crown counsel would not be occurring. The conservation

officer would simply issue a fine or a ticket or some other form of

corrective action.

That’s why there’s a connection between the length of time

evidence needs to be held and what we’re actually trying to address — in

other words, the seriousness of the alleged infraction. And for any one

of these cases, being able to hold the evidence for 12 months without

having to return to seek an extension is important, no matter how many

there are.

R. Merrifield: So if only the very few cases require an extension past those

three months, if only the most severe of cases require that length of

time to go past, does the minister have any data on how many that

actually is?

[2:40 p.m.]

Hon. G. Heyman: First of all, I want to correct…. I am not saying that the most

severe cases are the only ones that require an extension. For instance,

it wouldn’t be the most severe 2 percent. It would be any case that is

required to prepare a case for prosecution for Crown counsel. Those are

the more serious cases, but there’s a spectrum of them. There’s a range

of them.

To the member’s question, I don’t have that number, as I’ve said a

number of times today. We can get that number. It will involve a

significant amount of work by staff that will take them away from other

duties. Perhaps the member can have a discussion with me or people in my

office about whether a representative sample from one or two zones,

which would involve far less work, would be adequate for the member’s

purposes, rather than canvassing every single zone in the province,

which would require extensive work.

R. Merrifield: We have used a half of the day yesterday, a quarter of a day today

to argue or debate a bill that we have almost no data on in terms of

what the efficiency that we’re actually trying to improve is. Is it 24

hours a year over 160 conservation officers? Is it ten hours a year over

160 conservation officers?

But we’ve spent a lot of time — in fact, the minister spent two

hours of time yesterday — talking about how urgently this amendment was

required. I really don’t want to send conservation officers that are

overworked, underpaid and have massive areas in which to oversee…. I

don’t want to send them on a wild goose chase for more

numbers.

I want to give them more power. I do. I think them having the

equipment and the legislation that they require is absolutely necessary.

I’m just concerned that we’re spending, in our six weeks of this fall

session, basically, essentially, almost a day on a small amendment that

may or may not affect a handful of conservation officers every single

year.

My next question is this. Clause 1(

b) possibly will rectify this.

But currently if an item is seized through

section 107.03(3) and is

considered a pollutant or an environmental hazard or is contaminated by

a pollutant, what happens to it?

[2:45 p.m.]

Hon. G. Heyman: First of all, I just want to respond to the member’s

preamble,

which is simply to say that what we do in this House is debate

legislation. Some pieces are long and complex, and others are relatively

short, but they nonetheless contain important provisions — in this case,

giving a necessary tool to conservation officers that they previously

had.

Notwithstanding the member’s comments, I think it is time well

spent in this House, as we did yesterday, to talk publicly about the

important work conservation officers do, as well as to remind the public

of the role they have in reporting pollution or poaching.

To the member’s question, I’d like to ask some clarification. If

the member is referring specifically to hazardous material, substances

or pollutants, is the member asking how we dispose of that?

R. Merrifield: Yes.

Hon. G. Heyman: It would, of course, depend on, to some extent, the nature of the

material. But generally, we would contract with a company licensed to

handle and dispose of hazardous waste to dispose of it appropriately and

safely.

R. Merrifield: Under what time frame would that disposal or destruction take

place?

Hon. G. Heyman: For the period of time the substance or material was required as

evidence, it would be kept in a secure, safe container until such time

as it was ready for disposal. If only a small sample of the material was

needed, that sample would be retained in that manner, and the remainder

would be disposed.

If theoretically…. I have been trying to think what this might be.

Perhaps it might be radioactive material, although if it was something

that posed an immediate hazard and couldn’t be stored safely, we would

seek to dispose of it immediately in a safe manner.

R. Merrifield: Thank you to the minister for all of the answers today.

In querying through these, obviously the most important thing that

we can do is look for data to inform our legislative choices and our

legislative decisions. I agree with the minister that we are here for

that exact purpose — to debate and to bring forward issues.

I would just say that in debating through this — really, what is

an administrative change, back to where we were in 2019 — my concern is,

and I’ll quote the minister, that this time frame has been what has been

the overall determination of the government as to what the priorities

are.

So with that I’ll conclude things.

Clauses 1 and 2 approved.

Title approved.

Hon. G. Heyman: I move that the committee rise and report the bill complete

without amendment.

Motion approved.

The committee rose at 2:50 p.m.

The House resumed; Mr. Speaker in the chair.

Report and

Third Reading of Bills

BILL 26 — ENVIRONMENTAL MANAGEMENT

AMENDMENT ACT,

Bill 26, Environmental Management Amendment Act, 2022, reported

complete without amendment, read a third time and passed.

Hon. G. Heyman: Mr. Speaker, I call continued second reading of Bill 28, the

municipal affairs statutes act.

[J. Tegart in the chair.]

Second Reading of Bills

BILL 28 — MUNICIPAL AFFAIRS

STATUTES

(PROPERTY TAXATION)

AMENDMENT ACT, 2022

(continued)

B. Bailey: I’m pleased to rise and take the opportunity to speak to Bill 28,

the Municipal Affairs Statutes (Property Taxation) Amendment Act, as the

representative of Vancouver–False Creek.

The people and the businesses in my riding are among the most

affected by this important property tax amendment. In Vancouver, small

businesses are simply the heart of our community. According to data from

the city of Vancouver, there are nearly 80,000 small businesses in

Vancouver. The city defines small businesses as those ranging from a

sole operator to those of 50 persons.

Ninety-eight percent of all businesses in Vancouver are small

businesses. Interestingly, though, on the flip side, the majority of

jobs in the city are with large businesses. Although there are fewer

large companies, they employ a much larger segment of the population,

but that is not to say that small businesses aren’t important. In fact,

that couldn’t be further from the truth.

Even if you do work in a large company, for example, where do you

shop? Where do you eat? Where do you work out, get your suits dry

cleaned? Who fixes your broken plumbing, provides child care? These are

all likely small business folks, and our society desperately needs

them.

Small businesses are, and have been, under a lot of stress. Of

course, the pandemic is one reason, without a doubt. The help that our

province and the federal government provided often made the difference

of keeping the lights on or not. Now these same businesses are

experiencing cost escalation from many, many sources.

[2:55 p.m.]

Now, I just want to be very clear. I believe in the health

services tax, and I agree that freeing individuals from paying MSP is a

positive move for our general populace. It does have an impact on small

businesses. So, too, does the requirement to provide five sick days.

Again, I very much support this legislation. Workers deserve to be

protected and not compelled to go to work sick. It’s better for workers,

and it’s better for customers for sick folks to stay home. That cost is

borne by business.

Inflation, supply chain challenges and worker shortages are adding

cost pressure for these companies. So we must support additional

measures to ensure the success of small businesses in our communities.

What kind of a community would we have if small businesses were unable

to succeed?

One of the first issues I was made aware of when I became the MLA

for Vancouver–False Creek was the challenge for businesses on West 4th

and elsewhere who are experiencing vast increases in property tax,

passed on to them through the triple-net model of commercial property

leases.

For those who are unfamiliar, I’ll just simplistically explain

what I understand to be triple net. These leases have, as implied, three

components: the base rent, maintenance and property taxes. These are

shared out to lessees by the percentage of the commercial space that

they’re using. So if you’re leasing 50 percent of a commercial building,

you cover your rent, which is a calculation based on your square

footage; your maintenance, a percentage of shared space; and then 50

percent of the property tax. If you’re the only tenant, then, obviously,

100 percent is on you. The vast majority of commercial leases are, of

course, structured in this way.

B.C. Assessment considers the highest and best use of a property

when determining the assessed value. This is a standard of commercial

appraisal that’s used throughout North America.

A small business may have a multi-year lease in a commercial

building whose highest and best use is to be used to build a

multi-storey building. Those additional floors, not yet built, are part

of the tax calculation. Because leases are triple net, the increase in

taxation for those not-yet-built floors is passed on to the lessee.

Sometimes, often, these are small businesses. If those additional and

not-yet-built storeys are designated commercial, the taxation rate is

about three or four times higher than the residential rate — again,

passed on to the lessee.

We do want landlords to build housing. It’s an important and

worthy social objective. It’s a massive social challenge that we’re

facing.

Increasing housing is a reasonable social goal, of course.

However, our property market in Vancouver has been anything but

reasonable. Rapidly increasing valuations have led to dramatically

higher property taxes, again, most often flowing through to the lessee.

This is also happening because of rezoning, community plan changes and

ram­pant speculation. As a result, commercial tenants can be

responsible for higher taxes associated with an assessment value that

reflects the future use of the property, like a new residential

highrise, for example.

This issue is most significant in Metro Vancouver, where

speculation and increasing density to accommodate our growing population

have led to really significant property value increases in recent

years.

This bill, Bill 28, the Municipal Affairs Statutes Amendment Act,

will allow municipal governments a tool to work with, with their

communities to address this excessive tax burden on small businesses.

The proposed legislation will provide this new tool to municipalities to

help commercial tenants and owner-occupiers in their communities by

reducing the municipal tax rate on all or a portion of the assessed

value of the land.

Municipalities can implement this tax relief voluntarily where

they feel commercial properties are paying unfairly high property taxes

because of development potential. B.C. small and medium-sized businesses

are an integral part of our economy, and this is just one of the ways

that we’re helping them recover and grow.

[3:00 p.m.]

As mentioned, Metro Vancouver is home to about 50 percent of the

identified properties. The question might be: why wouldn’t we introduce

a provincewide program? But in reality, this is an issue that’s only

occurring in specific municipalities, and a provincewide solution could

cause unintended effects. So having this as an opt-in tool makes

sense.

The new tax relief tool is permissive. It’s not automatically

applied. Municipalities and taxing First Nations can decide whether or

not to implement it. For properties that meet the provincial eligibility

criteria, the municipalities can choose which properties receive the

relief and set the percentage of land that will be taxed at the lower

rate. The tax relief tool will be available to eligible properties for

as long as five years. In reality, municipalities know best whether this

relief is necessary and what types of properties they need to target, as

well as the extent of the relief required.

For these reasons, I’m grateful for Bill 28. I want to thank both

MUNI and Finance and for all of the small business associations that

participated and consulted. I know that this is going to be very helpful

for my community.

D. Ashton: It gives me a good deal of pleasure to be able to speak to Bill

28. I would like to thank the ministry staff for, I know, the hard work

that they had done on this and also for the minister bringing it

forward. Now it’s my understanding that it has been swung over to the

Minister of Finance, although it is an issue that has been dealt with by

businesses in the municipalities.

One of the big things that I heard that throws a red flag up for

me — and I heard this from the Minister of Finance this morning — was

“may,” “could” and “might” help. Well, those three words are flags for

me. I think that after two very serious years of COVID infection and

what that has done to businesses and to people’s jobs, the last thing in

the world that businesses need is a continual high taxation on

air.

I really, really hope that the minister and ministry will realize

that businesses are challenged these days. All businesses are challenged

these days, and more so, I would say, where municipalities have now

begun to tax airspace for a possibility of future development. It

doesn’t affect the whole province. I would even question whether it

would affect somewhere in my community. But there are communities in the

valley where I live that I’m quite sure, if not at this point in time,

will be subject to some other taxation like this.

I would hope…. I’ve heard this on numerous, numerous occasions in

this House, about every one of us: we should all work together. Well, I

issue that challenge back to the ministry, to the minister and to the

good staff at the ministry: that we all, collectively, need to sit down

with municipalities and that we need to sit down with businesses. We’ve

heard some things back from UBCM, but again, the vast majority of

members of UBCM are not individuals from the Vancouver area or the major

communities in British Columbia.

I really think that some collective decisions have to be made

about taxation for businesses these days. You know, the Internet has

caused great consternation amongst businesses. When I take a look at the

businesses, I’ll speak specifically to Penticton, where I had the great

fortune not only to be a councillor but to be a mayor, and also the

opportunity to chair the regional district. I look at what business

brings to communities and the hearts of downtown — which are usually

occupied; they have the greatest density of businesses in the downtown

cores — and, you know, how they continue to contribute.

[3:05 p.m.]

I look at Penticton — being fortunate to come from a family that

was involved in many communities in British Columbia with a retail

business — and about the supports that those businesses generate into

the communities and contribute to that community and to that community

spirit. Those businesses today, too, are also facing, unfortunately,

some of the social aspects that many of these communities are facing

today. That’s another cause, and this is just layer upon layer upon

layer.

I don’t need to look around here today, or look at yourself, Madam

Chair, to think about how many boards we have boarding up some of those

businesses that we knew, that prospered so well in many of our

communities. Without straying away to business principles in general,

additional taxation for possible future development is just one more

straw that will eventually break the camel’s back.

I really, really hope that the minister and the ministry staff

will take a look at this and will use the authorities that they have,

because this is being left up to municipalities. This is going to be

left up to individuals that right now are possibly proposing themselves

to their communities for a position on council or as a mayor. It’s other

individuals that are running again and trying to stand on what they’ve

done for their communities and done for the citizens that they’ve been

fortunate to represent. To be frank, they don’t have the time right

now.

I had the opportunity to talk to a staff member, and it’s “Dan, we

have an election.” What’s the date today? The fourth? So, 11 days. I

mean, pre-voting opens up, if I remember correctly, on Saturday. I think

it does. There’s an election taking place, and this bill could be done

by that time. I hope that everybody, collectively, will understand

what’s taking place right now with the election. I don’t think,

personally, it’s fair. You’re going to be looking at a whole bunch of

new council members and, quite possibly, a bunch of new mayors in the

communities.

Further to that, I think you’re going to be looking at staff in

the municipalities that are facing their own challenges with the

increased cost of labour, the increased costs of policing, the increased

costs in the communities, and they’re going to be whispering in the ear

of those councils and to that mayor, saying: “Good idea, Your Worship.

Good idea, council. We can’t really afford it this year.” Whack; again

it happens, where these people are going to be left out in the

cold.

I think that cooler heads need to think out and be collectively

working together on this. This was a great idea. I’m still in favour of

it. Please don’t get me wrong; I am. I’m just hoping that as it rolls

out, the timing on this and the ability for the province — I have to

choose my words carefully here — to help facilitate municipalities for,

possibly, the revenue that they may be losing for this air taxation,

that is prevalent right now, from B.C. Assessment.

After all these years, if I remember correctly, it has been the

last three years, and it has come forward five times, that a peer of

mine from Kamloops South has proposed this. It seems, at the 11th hour

and 59th minute, all of a sudden, the government is saying: “Well, here

we have a solution. You have to act on this if you want it to be coming

into the 2023 tax year.” I’m a little bit hesitant that municipalities

and the good councils that are there are going to have that opportunity

to do it and get it done in time.

I had mentioned the member for Kamloops South. He worked

tirelessly on this, and he had seen and has heard — as many of us here,

collectively, and on the government side, have been hearing — from the

citizens that we represent about what air tax is doing to some of the

businesses.

We all know that there’s pressure in the downtown core. Again, as

a councillor, lucky to be a mayor, you look at where you are going to

densify. You look at the best places to do that: in the city cores. It

always turns into the city core. We’re to take a look at the

opportunities of densification, but along with that densification comes

the business cycles.

[3:10 p.m.]

To be frank, I think we’re very close to — if we’re not in right

now — the end of a very long business cycle. Usually, I think, if I

remember correctly, they’re seven years, give or take, and I think we’re

pushing 12 at this point in time. There’s a lot of discussion in the

media, and there’s a lot of discussion by the pundits out there, that

has said this isn’t going to be pretty. This is going to rival 2008, if

not exceed it, and there are going to be businesses, again, that are

affected by an air tax and are going to struggle.

We can’t forget that, lots of times, those businesses, those

buildings, aren’t occupied by the owner. They’re occupied by people like

what our family was, retailers, or somebody else that is a lessee. Those

lessees…. Those costs, those triple-net leases, just flow right on down

to the tenants, and those tenants are the ones that are going to be

continually challenged, especially with the predicted downturn that is

about to take place.

I would really ask that the government — specifically the minister

and the ministry staff — take a look and just say…. You know, this is a

good bill. This is an opportunity that is being presented. But there’s

no real teeth in it for a municipality to take it and run with it. The

former Attorney General, the MLA that is now seeking the leadership of

the government party, has come out — I think a week ago, if I remember

correctly — with a carrot and a stick for municipalities for the

development of housing, saying: “If you do this, we will look at this.

But if you don’t do this, we will also look at that.”

I would hesitate to say that maybe he should be looking at this

bill also and saying: “As a government, we are providing municipalities

an opportunity to address the B.C. Assessment air tax on it, on the

particular locations. However, if you don’t address it and help those

businesses out there that are directly affected by this air tax, maybe

there are other things that we could look at that might be the carrot

for you.” I guess that’s a good way — not a stick, a good carrot. How’s

that?

Again, I would ask…. I’m glad to hear that government has been

listening to the opposition and the long list of businesses that have

not only approached each and every one of us here on the opposition side

but — I’m very, very sure — those that have been approached on the

government side just to listen to the causes and the

concerns.

Again, being involved in municipal politics before, that business

multiplier is something that I really had an issue with. During my

tenure, there was always a push to increase it, if it was like…. Instead

of 1 to 1 with housing taxes, it was like 1.5, and there was a push to

get it to 1.75 and a push to get it to two times what a normal

single-family residence or a home would be taxed at. It doesn’t sound

like much if it rolls off the top of your lips really quickly, but

businesses are….

Again, those challenges that they face and that additional

taxation that they already pay, and then to say, well, with the

possibility of a development taking place here, the possibility…. It’s

happened here, and it’s happened here. You’re the meat in the sandwich

between the two office towers, and there’s nothing to say that somebody

might come along and buy that property and develop a tower and airspace,

and now we’re going to start taxing you on it.

I can tell you that municipalities are looking in every pocket

that they can because of the ongoing expenses that unfortunately are

downloaded. They come federally, and they come provincially, and

municipalities and citizens are being asked to pick up more and more and

more. At some point in time, as I mentioned a little bit earlier, the

straw is going to break the camel’s back.

I would just really hope that in the conversations that are going

to take place, especially with my peer from south Kamloops coming up, a

gentleman that had pushed not once, not twice, not three times, not four

times but five times over three years to have the government look at

this….

[3:15 p.m.]

Now the government, to its credit, has come forward with

something, but I think it needs a little bit more tweaking than what has

been presented at this point in time. I quickly look at the percentile,

the 95 percentile between the assessed value on the building and the

assessed value on the land. That might be an issue. That might be an

issue that I think there needs to be a little bit of softening on to

make it a little bit fairer for all of those concerned.

Again, at this point in time, it’s being said as a temporary fix,

a temporary measure. Well, I mentioned that the business cycles are

seven. We’ve been fortunate to have almost a 12-year increase in the

opportunities in this incredible country and, more specifically, in this

wonderful province that we all live in. But a rule over five years may

not be enough. If a person gets on it, then at some point in time in the

future, they are going to be faced with this being taken away and the

opportunity for some form of tax relief that has taken place to be taken

back.

You know, it’s only on the municipal part of it, and that today is

— I guess you’re not supposed to use props but my fingers are that —

only yay much of the taxation when you take a look at business

improvement area taxes. You take a look at school taxes on it. You take

a look at regional district taxes on it. You take a look at hospital

taxes on it. You take a look at special levy taxes on it.

Oh my goodness, it’s only a small portion of it. Yes, every penny

is going to count, but in the entire picture of taxation that is taking

place on businesses and homeowners — but we’re speaking specifically

today to businesses and businesses that are affected by the airspace

taxation — it’s really only a small part of the pie.

Again, in my opinion, I would just ask the government if they

would take a look at this and try and work with this and work with

municipalities. UBCM is a good conduit for it, but UBCM is a broad net.

This is going to require a lot more laser focus on the issues that are

being faced by certain businesses that are affected by this air

tax.

It’s easy to get a vote on the floor. I could ask my peer, but I

don’t think this passed by very much when it was taken to UBCM. If I

remember correctly, it was very close. I’m not so sure that some of my

good peers understood it as well. There was a comment from…. I look at

my good friend from the Cariboo. Well, I don’t think people in the

Cariboo need to worry about airspace right now. They worry about their

air quality and everything else from the damn forest fires that we’ve

all been having.

I really think that we have to concentrate a little bit more on

the particular areas that are going to be affected. Again, I would just

ask that the government take a look at it.

It was raised by a peer of mine also that the lands around UBC are

not dictated to by the city/municipality of Vancouver. That’s an

electoral area, and it’s not there, but it’s my understanding there’s

airspace taxation that takes place there. The government didn’t look at

that side of the legislation that I’m aware of for the opportunities of

including certain regional districts and, if I remember correctly,

treaty lands and development — which West Kelowna would fit in, if

remember right, and North Vancouver and West Vancouver, Jericho

lands.

There’s a pretty…. There’s quite a bit of area and quite a bit of

development area has been left out of this because it hasn’t gone

through all the channels of government.

I would just say that when businesses, small and big, that are

surrounded by increasing values in house prices and condominium and

townhouse development prices on it, there is a real, real push for more

and more taxation.

[3:20 p.m.]

Taxation on air — I think we’ll all have our opinion on that. But

I’m not so sure that municipalities really shouldn’t take a look at

their own internal expenditures before they’re always trying to go out

and barter more revenue through taxation.

Again, I would like to say to the government…. It is encouraging

that this government has looked at this. It is encouraging that they

are, hopefully, listening not only to people like myself but to my peers

— maybe even to their own colleagues — and also to the businesses that

are going to be affected by this. I look in my area, and I’m speaking

very frankly…. This is that the core of communities favour — I would

think in most areas in British Columbia in the election process — the

current government.

I would really hope that they are going to listen to what is

transpiring in their area where people show the maximum support for the

government. I really think it’s something that they should listen to. I

really think it’s something that has to be addressed and has to be

addressed quicker than later. It also has to be addressed over the

length of time that the government has shown that it could be in effect

and also, that the government will work in partnership with those

municipalities instead of just saying to them: “Thou shalt have the

opportunity of this.”

From what I sense, and from what I’ve seen from my area,

municipalities are scrambling on a continual basis to derive revenue

from taxation. I think that there needs to be a helping hand of

government — the senior level of government, like the province — to help

facilitate this.

Don’t forget, ladies and gentlemen, and also Madam Speaker, that

the core of our communities is our downtown areas. Those areas are

incredibly important. That’s what makes a community today. It’s not just

the surrounding area. It’s the core. Vancouver, Burnaby, Abbotsford,

Kelowna, Prince George, other places — they have these other challenges

at this point in time. But as a kid growing up, when you had the ability

to come in and see the big city, as opposed to where I grew up, in the

rural area….

It’s pretty important for all of us to maintain a healthy and

vibrant downtown core and downtown area for all concerned, not just the

people that live there and people in surrounding areas, but also the

businesses there that support minor hockey, minor soccer, the SS

Sicamous , everything that’s donations. I can just

remember people coming in on a continual basis, asking…. You always do

your best because, as a business person, you believe in the community

that you’re deriving your income from, and you want to see it flourish

also.

Madam Speaker, thank you for the opportunity. I just hope we can

get through this with some resolve that makes it fair and equitable for

all concerned, not only the provincial government, but also the

municipalities and mostly the individuals that are going to be affected

by this directly, those that are paying tax on nothing but

air.

A. Singh: Thank you to my friend opposite. Prior to sitting here, I was a

small business owner for over two decades, actually, and really

understand the pressures that small businesses come under. At our very

small law firm, every little expense was calculated. So when there’s a

change in that triple net, when there’s a change that’s beyond your

control, it really makes a difference.

[3:25 p.m.]

Not only small businesses, but also non-profits have been stuck

with this situation where there’s no certainty to their triple nets,

where, because of development issues, property taxes have been raised.

We know, especially through COVID, that businesses have been struggling

— not only because of COVID, because of the aspects of that, but also

because of high property taxes. The effect of the pandemic on properties

— I didn’t expect that. I don’t think that was an effect that was really

foretold. Labour shortages, inflation — all of these things really

affect small businesses.

We’ve worked with municipalities and the UBCM and local

governments. Local governments have been asking for a long time for a

tool to help support small businesses and non-profits, and Bill 28 is

really a response to that. We’re reducing a long-standing tax burden on

B.C. businesses and non-profits through this new municipal tax rate

flexibility for eligible commercial properties.

Why have we left it up to local communities? It’s because they

know best. They are the experts in this. They know best, and that’s done

by design. This is what local leaders wanted, and this is in response to

that. This new flexibility tool, which will be coming in 2023, will give

municipalities a tool to help reduce disproportionately high property

taxes for businesses that occupied properties that have development

potential.

Again, it’s sort of a catch-22 situation. It’s great in some ways

that we have a province where people want to come into, where people

want to invest. But until you reap the benefits of that, when you have

high property taxes that are imposed on your business, it’s an untenable

situation. So we recognize that, and Bill 28 really tries to address

that.

B.C.’s small and medium-sized businesses are such an important

part of our society here. They’re an integral part of our economy. This

is really one of the ways that we’re trying to help them recover from

the effects of the last few years and to grow, and also recognizing that

the next two or three years may be quite difficult and challenging for

small businesses and people alike.

We want to thank all of the business organizations, all the

non-profits that came and informed the government and informed us on how

this legislation should read. I think what we have is a measured

approach that should be very effective. Again, it leaves it up to the

local experts, local municipalities to really govern their property tax

regime.

So why were commercial properties experiencing sudden property

valuation and tax increases? The problem really lies…. B.C. Assessment

considers the highest and best use of property when determining the

assessed value, which is in accordance with general accounting

principles. It’s a standard commercial appraisal method used throughout

North America and used throughout most of the world.

Because of rezoning, community plan changes or speculation — and

again, because of this amazing province that we live in and the fact

that people want to invest in this province — some commercial tenants

were responsible for higher taxes associated with an assessment value

that wasn’t cognizant of the actual value, at that time, of their

property.

Again, as has been alluded to before, by my colleague here and my

friend opposite, those costs are passed down from the landlord to the

tenant. Most small businesses and non-profits are tenants. They have a

lease. They have that triple net in the lease. So when a property tax

goes up, or common expenses go up, those are passed on down to the small

businesses.

This issue wisely was left, really, to local municipalities. Why

it was localized was because it’s the most significant, really, in the

Metro Vancouver area, where speculation and increasing density to

accommodate a growing population have led to significant property value

increases in recent years — again, completely unprecedented and

unexpected. No one would have thought that during the pandemic, property

values would rise in the manner that they did — no one.

We live in a completely different world than pre-pandemic. There

are the before times and the after times. Who would have thought that we

would have been….

[3:30 p.m.]

Even as I stand here speaking, we’re still in a hybrid session,

which will hopefully continue, because this is a different way of doing

things. People had the ability to stay home. There was more interest in

homes, and that’s partially responsible for those rising values. Again,

completely unexpected.

One of the effects of this increased interest in real estate was

that property values rose in areas unexpectedly, and they weren’t

cognizant with the actual value of the small business or with what the

small business was making. This really directly affects…. This addresses

that. Again, because the majority of this — more than 50 percent — was

localized to the metropolitan Vancouver area, Bill 28 allows local

municipalities to make the decisions that they need to, to address the

situation.

What does this tax actually do? As you know — we all know —

businesses, families are struggling financially because of increasing

valuations, leading to higher property taxes. What the legislation does:

it provides a new tool. We already had the interim tool that was passed

in March of 2020, so this is a continuation of that.

It provides a new tool to municipalities to help commercial

tenants and owner-occupiers in their communities, for a time period, by

reducing the municipal tax rate on all or on a portion of the assessed

value of that land. Again, the assessed value may not be cognizant of

the actual value of that land at that time, so what this does is provide

a tool to correct that. Municipalities can implement this tax relief

voluntarily where they feel commercial properties are paying unfairly

high property taxes because of development potential and because of

neighbouring development.

B.C. small and medium-sized businesses are an integral part of our

community. This is a great way to help them see what costs they have and

to help them recover. Why is this relief not mandatory, and why is there

a time limit on this? Again, because this situation was really sort of

localized in the metropolitan Vancouver area — more than 50 percent of

the identified properties really were tied to Metro Vancouver —

introducing a provincewide program for an issue that is really specific

and is only occurring in specific municipalities could cause unintended

effects, and we wanted to avoid that.

Again, also, we wanted to trust the local leadership and allow

them to do what’s relevant and what’s appropriate for their

municipality. Municipalities know best whether the relief is necessary

and what types of properties need that relief. This is not unusual. Most

property tax mitigation, most tax mitigation tools, are left voluntarily

up to the municipalities, right? This is something that is in line with

the legislation that already exists on many other things.

You may ask: why not regionally instead of voluntary decision by

municipalities? Again, this is in line with legislation that exists

already in other tax mitigation avenues. Similarly, those tools are

available to municipalities to voluntarily alter tax. This does exactly

the same thing.

I will reiterate. Local governments and municipalities know best

whether that relief is necessary. They know which properties need that

relief. They know which areas need that relief, right? For us to

introduce something provincewide just does not make any sense on the

ground. Doing that by region or provincewide would have maybe been too

limiting or would maybe have been too excessive.

Again, we trust municipalities to be able to do this. We’ve

trusted them to be able to do this because there are already existing

voluntary tax mitigation tools, so why not trust municipalities with

this as well? There’s no reason not to. Hence, Bill 28 really follows in

line with all the other property tax mitigation legislation that’s

there.

What is the tax relief eligibility criteria, and how will it work?

The tool is very permissive, and it’s not automatically applied.

Municipalities and taxing and treaty First Nations can decide whether or

not to implement it, again, leaving it up to local leadership, trusting

our partners in local leadership.

[3:35 p.m.]

[S. Chandra Herbert in the chair.]

For properties that meet the provincial eligibility criteria,

municipalities could choose which properties or which areas receive that

relief. They could set the percentage of the land that would be taxed at

a lower rate, set the rate by areas or by kinds of

properties.

Tax relief will be available to eligible properties for up to five

years from the first year of that relief. Why that time limit? It’s

because if a municipality has, and the market has, identified an area as

a potentially lucrative development area within those five years, more

than likely that imbalance of what the business is worth or what the

business is paying will be caught up. You’re not unfairly taxing a small

business or non-profit, and on the other hand, you’re not unfairly

taking away potential revenue from a municipality.

Will this program result in any lost revenue for municipalities or

the province? It won’t result in any lost revenue for the province.

Municipalities have the option to redistribute that tax liability to

make up for the foregone revenues within class 5 or class 6, which

relate to business and industry, or they can redistribute it among other

classes.

Some municipalities may have revenue-generating

op­portunities, allowing this measure to be accounted for

elsewhere in their budgets, but again, we trust our partners on the

local level to be able to do that. We’re hoping that communities,

businesses and non-profits will be able to see the benefit of this tax

relief by the 2023 tax year.

Just in response to my friends concerned about the timing of this

bill, in reality and practicality…. This is second reading right now. It

has to still go to committee stage. After that, it will go to royal

assent. We’re not sitting next week. In all reality, the local elections

will be over when we get back from the break, after next week. I think

this bill going through royal assent before that time is highly

unlikely.

So what about the 120 question that has been posed? What about the

businesses that were given temporary tax relief on the split classified

remission order for the 2022 tax year? Will they benefit from this?

Again, we gave business owners a year of relief through a temporary

solution to ensure that this small group of certain commercial

properties — again, mostly based in the Metro area — were not faced with

a sudden increase in property taxes in 2022.

Now we’ve given municipalities the flexibility and the power to

decide whether that relief should continue to apply to them or not.

Local leaders know best whether that relief is necessary. They know

their neighbourhoods, they know the potential of their neighbourhoods,

and we’ve left that decision up to them.

You would ask why a municipality would want to lower the tax

that’s generated. Really, businesses, small businesses, non-profits add

to the fabric and the culture of community. As my friend so eloquently

spoke of seeing businesses board up and close, no local leaders want

that, right? That in itself is the greatest incentive.

What we heard from local leaders, what we heard from

municipalities, is that high property taxes were hollowing out their

communities, that this is exactly what was happening. So that, there, is

incentive enough, and we trust municipalities and local leaders to do

the right thing. This is what they’ve asked for; this is the power that

we’ve given them.

There are also questions posed: why wasn’t this done earlier? The

interim measure was placed in 2020. We did consultations, again,

listening to local leaders. Hence, we have Bill 28 at this point. We

consulted with representatives from the Metro Vancouver municipalities,

from Kelowna, from Victoria and UBCM. We also consulted with various

business improvement area associations, chambers, the Canadian

Federation of Independent Business, Small Business Roundtable, the

Building Owners and Managers Association. Bill 28 is a result of all of

that work.

[3:40 p.m.]

Another question that was posed by my friend opposite was a

question about his colleague and his colleague’s private bill, which was

a great effort. But unfortunately, that bill did not specifically target

businesses operating under a lease and applied to all commercial

properties on the list. The application of that proposed bill would have

been so broad that it would have significantly impacted the tax

treatment of thousands of industrial and commercial properties with

development potential across B.C.

Rather than doing that, rather than having a reaction, we went out

and consulted not only with local business leaders and non-profits but

also with local municipal leaders. This Bill 28 is a result of that.

Bill 28 really is the result of a lot of work, a lot of collaboration,

and I’m very proud to support it.

B. Stewart: I’m glad to rise today on the occasion of this bill, Bill 28, one

that’s rather familiar to the official opposition. Bill 28 is said to be

designed to address the problem of skyrocketing property taxes on

businesses throughout B.C., specifically properties that have the air

tax above them. The bill works in enabling municipalities to utilize the

split assessment when taxing properties so that if a municipality so

chooses, businesses no longer have to be taxed on the development

potential of the air above their heads. This is a measure to address

rising taxation on B.C. businesses, many of which are struggling to get

by, especially after a challenging few years.

We’ve asked about the split assessment legislation in this House

and proposed with private members’ bills, but I do want to talk a little

bit about the extra cost and the burden to businesses. Prior to COVID

and the impacts of that, we added on new taxation in terms of the

employer health tax. We’ve seen continued rises in minimum wages,

recently the paid sick days and then, layered onto all of the challenges

that COVID has presented in terms of revenue, the employee shortages and

the fact that these businesses are hemorrhaging from the fact of just

trying to keep a business afloat.

I know that the businesses that we see and we’re talking about

here today are many of the ones that are in leased properties. They’re

not necessarily the ones that are in a situation where they have a huge

amount of ability to find the extra revenue that’s going to drive the

revenue to be able to pay what is being driven by a hot or unaffordable

housing market.

As I mentioned, the member for Kamloops–South Thompson has been a

tireless advocate on this issue, introducing a private member’s bill on

split assessment on five separate occasions while this government has

been in power. But you know, each time, it’s been ignored by the

government. There’s a laundry list of reasons, what they’ve said about

what it is and why it won’t work.

I kind of looked through at some of the quotes, and I think this

is about finding solutions, not to find barriers to being able to find a

way to help small mom-and-pop businesses make their way forward and pay

all of the new and increased costs, albeit that they’re not the ones

driving employer health tax or anything like that, but they do pay it if

they meet the minimum thresholds.

But let’s just take a look at some of the comments that have been

made by the government on this, about the split assessment: “It is too

broad. It does not take into account the significant consequences to the

entire tax system, and it is not going to give the small businesses the

tax break that they need.” That’s from March 31 in ’22, by the current

Finance Minister.

She said earlier: “In fact, if implemented, it could leave small

businesses worse off, as tax cuts for big developers and speculators

that are sitting on development properties lead to rising taxes for

small businesses and residents. It is a poorly, poorly, poorly

thought-out…that the member on the other side has.” That was February 27

of 2020.

[3:45 p.m.]

Again: “Whistler argued that the change will not achieve its

intent of lowering tax…for small businesses.” That’s, again, October 30

of 2019, by the current Finance Minister, who at that time was Housing

Minister and Municipal Affairs.

She goes on to say: “We are not ignoring them. We’ve heard from

them loud and clear, and there will be a…fix for the 2020 tax year.”

That was November 26 of 2019. We’ll come back to the date of 2019 in a

minute. “We’re going to continue to work…on a permanent solution. The

idea is a worthwhile idea, of the split assessment…. So we developed an

interim solution. It’s a solution that I do know and I do appreciate is

going to take a bit of work for local governments.” That was on March 4

of 2020.

Members of the government called the split assessment a poorly

thought-out idea. You can tell by those quotes. I think what we have to

do is get our head around why we have the problem and what it is that

we’re trying to accomplish. I think that in this particular bill, there

is an attempt at that, and I have to give the minister credit for

that.

They said that it would create challenges around fairness and

would not achieve its intent of lowering tax rates for small businesses.

When the NDP implemented their own attempt at the temporary solution,

not one single municipality used it, because it didn’t work.

Now, it’s not that municipalities haven’t studied this. In this

particular document — it was dated July 10 of 2019 by the city of

Vancouver — it talks specifically about independent small businesses,

arts, culture, non-profit organizations — in your riding, Mr. Speaker.

People, desperately, are in underdeveloped HBU properties, or they have

the challenges of highest and best use where the Assessment Act directs

property taxes to be based on the highest and best use.

The problem with that is if you’re a not-for-profit and you’re

trying to get started, how do you possibly afford something that’s got

all of that airspace above it? The bottom line is that we see it mostly

in the city of Vancouver. We do see it in other urban areas. But we need

to make certain that we’re looking at this through the lens of not just

small business but the not-for-profits and the arts community, which I

think deserve fairness as well. In some cases, the cities are able to

either exempt that, but in a lot of cases, they may not be able

to.

For underdeveloped, highest- and best-use commercial properties

and unrealized development potential, it could result in significant

property tax implications if something like a split assessment is not

there for the municipalities to use.

We know that in the last few years, we’ve seen runaway housing

prices. We’ve seen prices that, frankly, are some of the highest in

North America and maybe many other parts of the world. We know that

that’s probably caused partially by a supply issue. But secondarily,

what it’s doing is fuelling the energy that is putting the pressure on

B.C. Assessment to assess those individual properties and say that

there’s this issue about the fact that the valuation…. There’s so much

potential.

A small business, a not-for-profit, an arts group — they can’t

afford that. Essentially, this is an interim step until those properties

really do redevelop. And possibly, when the landlord that might be a big

developer comes back and says that they want the mom-and-pop shop that’s

in their business or the not-for-profits….. What they do is create

reasons why they’re going to fill that space, whether it’s a mixed-use

space or whatever.

So landlords, in this particular case, pass it on through

triple-net leases, and it becomes a burden onto tenants. The problem is

either they make an adjustment, or they lose the tenants, and the

community becomes gutted because of the fact that we’re losing these

small businesses, people that we want.

How many people…? We’ve talked about this in our Finance Committee

meetings — about the arts commun­ity and how it was dealt such a

severe blow during the time of the pandemic. The bottom line is that a

lot of these people are just trying to get noticed or show off what

they’re doing, etc., and they need a leg up. They’re not at the point

where they can afford a ridiculous highest- and best-use property tax on

it.

[3:50 p.m.]

The other thing independent owners and operators may also

experience is the cash flow problems that this exacerbates in terms of

all of those other costs that we’ve put on. Whether it’s labour code

changes or taxes or the cost of doing business, the bottom line is that

cash flow is king when it comes to a business. If you don’t have enough

cash coming in to cover all of your costs, whether it’s food or your

employees or the rent or the taxes, etc., you, essentially, soon find

you’re out of business.

This report goes on to talk about some of the impacts that are

potentially in here. It talks about zoning districts where there’s not

enough specificity in zoning bylaws. Not being from local government —

but I can understand that if there was a case that the zoning had the

specifics that allowed for exemptions, it just falls to the lowest

common denominator.

By now, after years of delay and countless small businesses having

to close their doors permanently, which I’m sure that many of us have

seen in the city of Vancouver and other communities, we need to finally

come forward with a version of a split assessment that’s going to

work.

I just want to read from the Canadian Federation of Independent

Business. It talks about: “This proposal is one that many stakeholders

have come out in support of. The policy would help give some of the

businesses being pushed out of our neighbourhoods from a phenomenon

that’s completely out of their control,” says Aaron Aerts, the western

economist for the CFIB.

They also go on to say: “The policy is known as a split

assessment, which allows municipalities to set lower tax rates on the

air above the small businesses, known as the ‘development potential’.

Currently, municipalities must charge the commercial rate on that air,

which in some cases is four or more times higher than the residential”

rates.

I’m glad. We’re glad as opposition to see that the government has

listened to us and hundreds of small businesses calling for this

solution. It’s long overdue. But we do have significant concerns about

this legislation. Does it go far enough? Just like the last time that

the NDP tried to fix this problem. A 95 percent land value requirement

by this particular bill may be too high.

What flexibility does it give different municipalities where they

may have differences, etc.? Where did that number, 95 percent, come

from? We’ll look forward to in further readings about this where our

critic will be able to find the answers to those questions, I hope. But

we want to make certain that this is going to be successful. I’ve just

read off a laundry list of companies and businesses, not-for-profits,

arts groups, some of the ones — they’re not the only ones that I can

think of — that have been identified that have been disenfranchised by

the fact that we have allowed this to go on.

It’s not the first time. We have had run-ups in housing prices

many times before. But what we really need to do is put something in

that empowers municipalities and local government to do the right thing

and not allow them to drive these businesses out of their

community.

So we have little transparency in how the properties will benefit

from this legislation at this point, and we don’t actually know how many

businesses this bill will actually help.

It’s also worth noting that the legislation itself is only a

temporary measure as the way the government has written it so that

municipalities can only reduce the taxes on business property for up to

five years. Well, five years. What’s going to happen? We’re going to

have a real estate downturn? I don’t know. Is it going to keep going up?

The bottom line is that I think it’s got to be dynamic. It’s got to be

flexible. It’s got to be able to be workable. There doesn’t appear to be

any option for municipalities to renew this beyond the time frame,

meaning that these mom-and-pop stores and critical local businesses will

face the same problem in a few years’ time. It simply just kicks the

problem down the road instead of delivering permanent help.

Additionally, the NDP’s version of the split assessment will only

be available to municipalities. So we’re excluding regional districts.

We’re excluding resort municipalities. We’re excluding places where we

don’t know that this might not exist, and it might be happening. I know

that I read a quote from Whistler. But as we were just up there, I did

notice that Whistler has got its fair share of boarded up properties,

etc.

[3:55 p.m.]

They’re not immune to the effects of what the pandemic or high

prices have had. Of course, Whistler doesn’t have the speculation tax,

so we have lots of foreign influence in there, and I know that it’s not

something that we want to upset. But on the other hand, I would beg to

differ that Whistler is not necessarily in the same

situation.

Other examples would be UBC. It’s on its own. It’s not part of the

city of Vancouver. What about electoral A at Cultus Lake? Many areas

bordering in the Okanagan, where I’m from — the Thompson, the Shuswap —

will not be able to access this relief. All of these areas are

businesses increasingly exposed to high property tax.

I can tell you that in my own community, I can’t help but look

across the riding and see building after building that is not ten, not

20, not 30 but 40-plus storeys going up in the downtown. How is that not

going to change the downtown of the city of Kelowna, let alone other

cities? Maybe Penticton’s, next to Vernon? Why is that? It’s because of

the fact that we still have this housing supply crisis.

We know that after six years, we’ve heard that the candidate

running for the leadership and premiership of the government has put

forward a bold and ambitious plan, and we’re anxiously awaiting the

results of that. The former Housing Minister from Vancouver–Point Grey

has failed to deliver on every opportunity to make those results happen.

He promised 114,000, or the government did — 114,000 new and affordable

housing units in ten years. All we’ve seen is about 7,600 of those

actually built.

The bottom line is that without the housing, we’re going to

continue to have the pressures that are going to cause split assessment.

I hope that this bill, Bill 28, is going to help address some of that,

meaning that it will be meaningful to communities to see that

happen.

Anyways, I’m glad to see, at the end of the day, that the

government’s seen the benefit of what the split assessment act

legislation can bring. It’s frustrating to see that they’ve ignored our

suggestions in the past and produced a bill that will not support all of

the things we had in mind, but it is needed for B.C.’s small

businesses.

R. Russell: It is my pleasure to rise in favour of this bill. I appreciate, I

think, as most of us have heard…. The demand, the request for this has

come forward, over time, from many of the voices we hear at

organizations and venues like UBCM, for example, where municipalities

want more flexibility. It aligns well with our own government intention,

I think, which is evident in a lot of the work we do, which is really to

recognize community as a central voice in terms of understanding what’s

best for what they need and, on our part, here in this House, to be able

to provide legislation that enables them to make those decisions in a

way that works well for themselves.

I think this, again, is something that a lot of people have been

waiting to see, and I’m happy to see that we are finally bringing

something like this forward. We’ve already heard people speak to the

kind of operational…. How this flexibility is going to come into play.

But I think for me as well, it’s important to speak to — as we heard the

member from Kelowna West as well as from Penticton speak to — how small

businesses are really at the heart of our communities. This is a piece

of legislation that, ideally, will help enable those small businesses to

continue to thrive.

Certainly, in a lot of our communities, small businesses are part

of the resilience in that economy as well, part of how we ensure that

when global supply chains, for example, are disrupted, various kinds of

pressures from outside of our province and outside of our communities

aren’t as dramatically felt inside those communities.

It’s the small businesses that help even out some of the bumps in

that economic activity, so giving local governments an avenue through

which to provide some flexibility and lessen the tax burden, lessen the

pressure on those small businesses, is certainly something that is

important to me as a member here and, I think, to us. We know that small

businesses are an enormous component of Canada’s economy, beyond just

the actual numbers of those small businesses.

[4:00 p.m.]

Of course, they vastly outnumber the larger businesses, but I

think more telling is the fact that those small businesses in Canada in

2020, for example, composed 68 percent of employment across our country

in the private sector. That’s something to be proud of, and that’s only

the small businesses. When you include the medium-sized businesses, that

adds another 20 percent to those numbers. So the vast majority of

employment in our communities is in those small and medium

enterprises.

I’d like to also speak a little bit…. I know the previous member,

the member for Kelowna West, had mentioned the question around the 95

percent, which I think is a good question. You know, why is it set at

that level?

I’ll read a little bit here: “The properties with developmental

potential have a high land value because they often have dated or fully

depreciated improvement.” Most of their value is in the land. That’s the

challenge we’re trying to address here. The determination of that 95

percent is that, after analysis, in consultation with a core group of

municipalities and B.C. Assessment, a ratio of at least 95 percent would

ensure that most properties with that development potential that we’re

trying to support would be eligible. A municipality can, of course,

increase that number if they wish, if that would better suit their own

needs, and I think that’s an important piece to highlight.

There was also a question about why…. You know, what are the

implications of the fact that the interim business property tax relief

wasn’t actually utilized by local governments? I think it aligns with

some of the challenges of that 95 percent and making it a lower number.

While some municipalities have expressed interest in that interim

legislation, none of them actually utilized it.

The main feedback that was heard on that legislation was it was

too cumbersome and complex to implement. I think that also speaks to the

challenges of the private member’s bill that was brought forward on the

same topic. For example, municipalities felt that having to verify a

triple-net lease would be simply too administratively burdensome, which

is…. That’s the challenge here that we’ve heard from members opposite

that we want to avoid — placing too much of an administrative burden on

local governments in order to provide this flexibility.

So that’s the nature of this bill that is coming forward. Partly,

the advantage is the simplicity in how it is defined and reducing that

burden on local governments to provide the flexibility that we know that

they’ve asked for and this piece of legislation is intended to

provide.

Municipalities also felt the legislation only addressed

volatility, so increases in assessed values, and didn’t address the core

issue of taxes on development potential, which is what we’re intending

to address here. And in that process…. Again, where did that number come

from? That came from extensive consultation with municipal partners and

B.C. Assessment and, particularly, the city of Vancouver, where 50

percent of the target properties are located. Their concerns were

discussed regarding that interim legislation and where there

is….

While there’s no solution, of course, that’s going to meet every

municipality’s needs, that balance was struck because it would help

municipalities provide relief to the businesses most in need while not

providing too much of an increase of that challenge and administrative

burden for local governments. The detail and design of this legislation

has been worked on with those stakeholders to ensure it’s usable and

effective in those domains.

Again, back to the question, also, of the member for

Kamloops–North Thompson and the bill that was presented there. That bill

was challenging, I think, on a few different levels, one of which was

that it was simply so broad that it didn’t give those municipalities the

flexibility to do what they know their communities need, which again is

central to what I feel like I am using my voice for here in this House,

which is to entrust that communities can lead in whatever way possible,

and we can help support and enable their leading.

[4:05 p.m.]

A blanket adjustment is challenging. A blanket change to all those

commercial properties, I think, would be problematic, and that would

significantly impact the tax treatment of thousands of industrial

commercial properties everywhere, which is an issue. Again, without

providing that flexibility to address the issue at hand, in the

situations where it was most suited, which would of course then…. For

those of us that have come out of local government, if that blanket

application was in play, it would simply mean that tax rates elsewhere

would have to universally increase to meet the budgets that a local

government is setting out and trying to satisfy with those

taxes.

That bill also required B.C. Assessment to calculate a tax on an

unbuilt airspace, which is something that is, as far as I understand,

foreign to what B.C. Assessment currently does and certainly would be a

new and potentially challenging assessment to bring into force without

an enormous process of appeals following suit.

I will conclude by saying, again, that I think there are many

examples where we’ve demonstrated…. Certainly the world of emergency

management is something that I am familiar with. I’m very proud of the

province of B.C.’s approach to put communities at the centre of how we

navigate through community recovery. This, to me, is another example of

how we try to help in this House, how we try to help our communities do

what they know they need to do best.

As with emergency management, we go to those communities and we

ask them what they need, and we try to figure out how those of us here

can help support that. This is a similar thing, in my mind, where we are

moving forward with legislation to go to communities that have asked for

some help, figure out how to provide enabling legislation that is not

directive or prescriptive and be able to let them do what they need to

do.

R. Merrifield: Thank you to this House, because what I love about today and what

I love about the debate that I’ve been able to listen to is that this

House is in agreement on the importance of small business, on the

importance that it brings to our communities and the importance that it

is to those that are employed by them.

We’ve heard a lot of statistics, and the member for

Vancouver–False Creek was talking about the statistics in her area. In

the Okanagan, 95 percent of all businesses are small and medium

enterprises, but we have a much higher percentage of those that are

employed. So we’re looking at between 85 percent and 90 percent that are

employed by those small businesses, which is a much higher

percentage.

We know, not just from the anecdotes within our community but also

from the experts, how important small businesses are. The Harvard

Business Review actually notes that small businesses are

imperative for an economy to have resilience, for an economy that needs

recovery or for an economy that is in the midst of innovation. We

absolutely need small businesses. We need medium businesses.

This bill is not unusual for us, because as has been noted

already, my colleague and the member for Kamloops–​South Thompson

has been a tireless advocate on this issue. I think he’s actually

introduced a bill on split assessment on five separate occasions. His

efforts have been valiant and almost akin to banging his head against

the wall. But, truly, he’s been doing it because he’s been sounding an

alarm bell for our small businesses who have been adversely affected by

not having the ability to have a split assessment zone.

[4:10 p.m.]

Instead of moving the bill forward, this NDP government has chosen

to move their own bill forward, which is supposed to address the problem

of skyrocketing property taxes but introduces complexities that I think

are unnecessary. On face value, yes, the bill works by enabling

municipalities to utilize split assessment when taxing properties so

that if the municipality chooses, businesses no longer have to be taxed

on the development potential of the air above their heads. But what

happens if a municipality decides not to do that?

Businesses need relief. They have taken so many hits over the last

few years, between the COVID shutdowns, the supply chain disruptions.

Whether it’s been the fires, the floods, COVID, strike action, labour

force shortages or insanely high inflation, they are hurting. They are

still hurting. They have not recovered. In fact, many of the

associations out there are still sounding the alarm bell. This is

relief, but it’s a little too late.

While this might seem, at face value, to be somewhat of a

collaboration with our municipalities, it’s yet another download of

provincial responsibility onto our municipalities. Our municipalities

are stretched. Rather than doing something, a bill, that was

straightforward, like the one that the B.C. Liberals have been putting

forward, we’re getting something that is more complicated and is really

a download onto the municipalities. Why? Why did the NDP government

actually ignore the bill that was brought forward?

My colleague from Kelowna West has done a great job of actually

giving quotes from some of the NDP ministers as to why a split

assessment wouldn’t work, why it couldn’t be done, why it was a poorly

thought-out idea or how it would create challenges around fairness. Yet

here we are debating exactly this and supporting this. It’s delightful

that the NDP have come around to see it the B.C. Liberal way.

My other concern is that the temporary measure that was put

forward previously didn’t work. Not one single municipality used it. So

the NDP have not been successful in creating something that would

actually move forward.

I’d love some data on how many businesses have actually closed

their doors because they couldn’t afford just one more January 1, where

that tax bill was going to be ren­dered, where they couldn’t have

their triple-net go up just one more time, where they didn’t have the

revenue to bear what their cash flow was going to demand.

We can’t even fully use bankruptcy numbers, which are on the rise.

We can’t even fully use bankruptcy numbers because many businesses won’t

choose bankruptcy. They’ll just close their doors.

I have to say that I’m really glad. I’m really glad to hear all of

the support for small businesses in this House and also hear that we’re

finally going to see what we’ve been talking about for five years come

to fruition. It’s really long overdue.

Where are my concerns with this actual bill? Well, the 95 percent

land value requirement that the NDP proposes is actually very high. It’s

incredibly high for most businesses, which won’t even qualify for this.

It might work in downtown Vancouver, where 0.1 of an acre is selling for

$24 million to $80 million, but it’s not going to work for the

redevelopment properties in the downtown core with ma-and-pa

restaurants.

Just on the one block…. I know I’m venturing into territory that

Kelowna West has, so it’s not really just my riding. Small ma-and-pa

restaurants, which are in old houses that sit next to either highrises

or sit next to even eight storeys…. Well, their restaurant is not going

to qualify. They won’t have that 95 percent land value

requirement.

[4:15 p.m.]

The way it’s talked about in terms of depreciation is simply not

how B.C. Assessment works. B.C. Assessment doesn’t depreciate the asset

like it would on a balance sheet. B.C. Assessment actually is market

value. As long as a house, in market value, is worth that, it won’t

actually qualify.

The other question I have is: how much research has actually been

done on this? We’ve heard a little bit about the consultation process,

but none of the data. I would love to see how this will affect those in

the South Pandosy area of my riding, or in the downtown core of Kelowna.

I would love to see some data on how these businesses will be positively

affected, but the 95 percent would need to be changed. I think that the

previous bill, put forward by my colleague, would have a better

mechanism, as it were, to actually put through that.

The other concern for me is that this is temporary. Five years

seems like a long time; it’s not a long time. It’s not a long time for a

business that’s trying to make a 20- or 30-year commitment to its

community, that’s trying to provide a service or goods to its community.

It’s not a long time in development, and there doesn’t seem to be any

mechanism or option for these municipalities to renew beyond that time

frame. So the five years literally is like a stop, and then there’s

oblivion.

Why would a municipality actually implement that? Why would they

go through all of the trouble to then just have it stop? Why would we,

as a House, actually want a bill that doesn’t provide permanent

solutions? Why would we want something that just kicks the problem down

the road?

The other thing. In the Okanagan, we have a lot of regional

districts. Those regional districts have properties that have values.

While this only applies to municipalities — which makes sense, maybe, in

areas like the Lower Mainland — in the Okanagan, it doesn’t make as much

sense. We have some very expensive land and expensive properties that

are outside of the municipal boundaries and that are in regional

districts.

I understand why this is happening. I understand why we need split

assessments. Anyone who looks at the downtown Kelowna landscape can

understand how many tow­ers have gone up. We don’t have sales

centres that still say: “Selling still.” They’re sold out.

We have a housing crisis in B.C. We have a housing supply issue in

B.C. We haven’t been putting out enough housing over the course of the

last six years. The former Housing Minister has built just 6.3 percent

of the 114,000 homes that this government promised to build. What

happens if you don’t build housing is that housing prices go up. What

happens when those housing prices go up? Land values go up. What happens

when land values go up? Small businesses that happen to be sitting on

land pay a huge burden of property taxes.

I would say that we failed. We failed our small businesses by

failing our communities with not enough housing. I would say that this

NDP government has not been serious about actually increasing that

supply. It’s only been in the last year that the NDP have actually

figured out it’s a supply issue. In fact, we’ve been hammering on the

demand side with more and more taxes rather than focusing on incenting

supply. Here we go again — just another tax that has sat for five years

when it could have been relieved.

[4:20 p.m.]

At the end of the day, I’m still happy. I’m still happy. I’m

pleased to see the conversation around small businesses. I’m pleased to

see the conversation around tax relief for those that are desperately

trying to hang on. I am pleased to have the conversation about something

that we have seen as an issue on this side of the House for the last

five years and five submissions.

I just hope that we can get through some of the details of this

bill and get it to a real, workable solution so that more than zero

municipalities actually use it.

M. Dykeman: It’s a pleasure to rise in the House today to have the opportunity

to talk about tax relief on the way for small businesses and the

opportunity to speak to this bill on how it will positively impact my

community of Langley. I was really happy to see this come forward, as

municipal and business stakeholders have been asking the province to

provide specific tax relief tools for businesses that occupy commercial

properties with development potential and pay disproportionately high

property taxes. That is a significant challenge in Langley.

We are one of the fastest-growing communities in British Columbia.

We’ve had 14,635 people move to the community in the last five years —

3,862 new residents just from 2020 to 2021. That creates challenges.

Growth is a wonderful thing, but it obviously creates a lot of different

challenges within a community — everything from amenities for residents

to opportunities for businesses to set up and continue with the pressure

on available lands.

What’s really unique about my community is that the 160,000 people

that live in the Langleys sit in a region of three million people, and

75 percent of the township of Langley’s lands are dedicated to the

agricultural land reserve. Essentially, the township of Langley produces

80 percent of Metro Vancouver’s contribution to the prov­ince’s

agricultural land receipts. In a little area with incredible growth

targeted in communities, you have a large percentage of the land mass in

agricultural production, which is fantastic. It’s so important, but what

it does is it creates a significant amount of pressure, when you have

that much growth.

People are moving to Langley because Langley is a great place to

live. The township of Langley is home to 20 ac­commodation

properties, nearly 300 food and beverage service establishments, and it

provides the community with about $30 million in annual revenue. With

growing businesses and residential sectors, there really is a lot of

future growth happening in industry in that area, but it’s very isolated

in where that can take place, because so much of the land mass is

dedicated to agriculture.

Really in that area, you’ve got…. We, as Langley, are part of the

end of Metro Vancouver, and then it goes into the Fraser Valley. You

have a very small area creating the majority of the agricultural

production, at least in that region.

We’re also a really film-friendly community. That has created lots

of opportunities for people to welcome film to Langley, which has been a

great economic driver in the region. We have a very diverse landscape,

and we have a really cool community called Fort Langley. Fort Langley

really is like stepping back in time. There’s a lot of history in that

area, it’s really an area that people want to come and film

in.

What’s funny is that it’s actually the summers when you’re filming

your Christmas stuff. There are grocers there and wonderful little

bookstores, like Wendel’s Bookstore and coffee shop. There are antique

stores. There are neat little boutiques. What will happen is you kind of

wander into Fort Langley, and it’s June, and it’s completely decked out

for Christmas. There’ll be Christmas trees and snow. It’s hot out, and

everybody’s wearing shorts, but it’s Christmas in Fort Langley, because

we have so much film there. It creates so much for the economy,

right?

[4:25 p.m.]

It’s a great place to have a store because especially in the film

industry, so much of the shopping is done locally. That’s a really great

opportunity in Langley — part of a fantastic community, a place with

wonderful schools, lots of parks, lots of agriculture, a beautiful place

to raise your children — but not a lot of opportunities for businesses

to set up because it’s not a lot of land, and then you add the

additional pressure of a lot of competition for the property.

That’s why something like this, where you have an opportunity to

help businesses that are struggling because of increased property taxes,

will also help address other challenges that have come at this time,

including labour shortages and inflation, helping reduce the cost of it

for businesses.

Such a fantastic thing to come forward at this time, because our

small and medium-sized businesses are the backbone of our economy. They

are the people who sponsor your child’s baseball game. There are people

who live in your community. They shop in your community. They’re giving

back to your community. These are the people that make a difference

every day in our local economies. A measurable difference like this,

providing an opportunity for B.C. businesses to have a reduction in the

tax burden through this new municipal tax rate flexibility, is such a

great thing to help our economy.

I do want to take a moment to quickly thank the businesses,

organizations and municipalities for their support during the pandemic

and keeping our businesses going forward.

Excuse me, hon. Speaker. I have a cough, and I’m going to have to

wrap it up. Sorry. With that, thank you very much. I need to take my

seat now.

T. Stone: I’m pleased to take my place in the debate today on Bill 28, the

Municipal Affairs Statutes (Property Taxation) Amendment Act,

I know the general rule of thumb of this place is that the

government introduces bills, and the opposition opposes those bills. A

different way of saying it is that we in opposition have an important

role: to shine a light on the intent of bills and on allocations of

funding and public resources that are detailed in bills, and that all of

those tough, important, focused questions are asked.

We’ll certainly do that with this bill here today, but I do want

to acknowledge that I think there is an attempt here, on the part of the

government, to bring forth a piece of legislation that, while it does

have its flaws, is worthy of the support of members of this

House.

I say that with respect to this bill because this bill largely

encompasses the intent of a bill that I have brought forward in this

House no less than five times. Five times lucky, I guess, is where we

are today with this piece of legislation. Specifically, I have

introduced, over and over, a bill intituled the Assessment (Split

Assessment Classification) Amendment Act. Again, it was a bill that was

intended to address the challenges that I think the bill in front of us

today, from government, is intended to address.

There are some differences, and I will touch on those differences

in a moment. There are some areas that I would hope would be worthy of

consideration on the government’s part — some flaws in the legislation

that, if ad­dressed, would make the legislation an even better

piece of legislation and one that might have a much higher likelihood of

being utilized as intended to reduce the property taxation burden of

small businesses. But let’s just lay out the challenge that this bill is

intending to address and, certainly, that the private member’s bill

which I’d introduced was intended to address.

[4:30 p.m.]

The bottom line is that as our urban centres across this

province…. Whether you’re in Kelowna — as my colleague from Kelowna

just, I think, very eloquently outlined — or if you’re here in Victoria

or if you’re anywhere in greater Vancouver, particularly the city of

Vancouver itself, there is significant densification taking place in our

urban cores. That significant densification is placing huge pressure on

small businesses in a number of ways, but one particular impact is

through dramatically increased property taxes based on the unused

airspace above the heads of these small businesses.

When you actually sit and talk to small business owners and their

patrons and explain to them how the taxation is actually imposed, how

it’s calculated, what it’s on…. People look at you, and the general

reaction is: “Really? This flower shop has to pay these inordinate taxes

on the undeveloped potential that is above the existing structure,

literally the airspace of that building?” Regrettably, one has to say:

“Yes. That is correct.” That is a significant challenge that is imposed

on small businesses through the current taxation regime.

What has been happening in communities around the province, again,

particularly in Vancouver…. I think of the many businesses that I’ve met

on West 4th, in the Granville corridor, in Marpole, in downtown

Vancouver — again, also here in Victoria, Kelowna. When I think of the

small businesses that I’ve met, the associations, the improvement

associations and the like in these different neighbourhoods of these

different communities…. There has been a long-standing common refrain

of: “We need help. We need help with these soaring costs that are

literally out of our control.”

Because of the triple-net lease realities that are in place for

that particular business, meaning, as part of the calculation of the

lease payments, any change up or down — and it’s very rarely down — in

the property taxes owing on that property flow through to the tenants

that occupy the space that is on the land on which the taxes are being

calculated. These businesses simply can’t afford the huge escalations in

taxes that they have seen.

The pandemic, obviously, placed additional strains, as we all

know. We’ve canvassed thoroughly, on many occasions in this chamber and

elsewhere, the impacts of the pandemic on small businesses. Different

types of small businesses were hit harder than others.

The bottom line was that there were lots of small, typically

independently owned and operated retailers, restaurants, cafés,

florists, those types of businesses, which, by the way, really drive the

vibrancy in our downtown cores and in our communities…. These businesses

were beginning to have no choice but to have to shut their

doors.

You still see it, to this day, in all of these corridors — far

more storefronts that are boarded up or that have paper on the windows,

big “For lease” signs in the windows. Usually, when you actually get to

the bottom of why that particular location is vacant and is not being

leased, it’s because of the costs of that particular space, which are

largely driven by the property tax piece.

What we’ve all been hearing for many years now, from these

business improvement associations and these different neighbourhoods and

the patrons of these small businesses and the small businesses

themselves, is…. This hollowing out of these communities and these

neighbourhoods has to stop. But for it to stop, it means that we need

sensible, realistic tax policy and other policies and regulations that

make that possible.

[4:35 p.m.]

This is, obviously, partly the responsibility of local

governments. They have a huge, huge role to play here. There are also

things that the province can do to help, and that’s really what this

whole concept of split assessment classification is intended