Yesterday in Victoria, we released a 48-page report by independent CMA Sacha Peter on the true cost to Capital Regional District taxpayers of the Seaterra sewage treatment plan. It’s not pretty:

• Inflation from 2010 has conservatively increased the capital cost of building the project to $830.6 million. Plus you can add another $38 million for biosolids plant, meaning the original $783 million price tag is now $869 million.
• The annual operating cost has now grown to $15.46 million.
• The average CRD homeowner will pay about $410 per year for the project
• The CRD’s tax plan understates the average Victoria homeowner’s tax bill by $579 over six years, Esquimalt by $555, View Royal by $195, and Saanich by $69.
• Should cities apportion sewage taxes to businesses at the same ratio it uses for property taxes, the average CRD business property owner would pay $2,306 per year for the project’s capital and operating expenses.

No one seemed to argue much with our inflation or property tax numbers (although project chair Geoff Young claims that Seaterra can manage those inflation costs within the current $783 million budget envelope. Highly unlikely, but we’ll see.).

But Victoria Chamber of Commerce executive director Bruce Carter went apoplectic over the business number, claiming businesses will pay the same $410 per year as homeowners. So we rechecked the numbers with Sacha. Here’s what he says:

• Assuming 1.3% growth across CRD, average SFD owner will pay $410; OR average SFD owner $273, AND average business property owner $2,134.
• The definition of "average" here is crucial.  It is NOT $2,134 per business, it is $2,134 per business property owner.
• Obtaining data on how many businesses there are is not reliable.  Business licensing, for example, would include home-based businesses and you could have multiple businesses per physical business dwelling.  And what about holding companies, etc, etc.  The only logical way to measure the impact is on the entity that is directly taxed, and that is the business property owner.
• There were 5,468 business properties in the CRD in 2013.  Average value is $1.36 million.
• Business taxes are typically embedded in the leases of people that lease commercial property.  So if your commercial property has an assessed value of $1.36 million, you would be incurring an extra $2,134 in operating costs for your business.  If your property has an assessed value of half of that, then it is half of $2,134.
• This assumes a 2:1 residential:business taxation ratio.  In terms of actual consumption, Stantec's report had projected industrial/business to residential usage at 2.25:1.
• We did not make a projection by municipality for the business tax scenario because the October 10, 2012 model has serious flaws.
• The CTF report contains 100% work that can be independently verified from the assumptions listed in it.

Not to go even further into the weeds, but there was also some suggestion that the fact the taxes will be charged through a municipal utility makes some sort of difference. It doesn’t.

Somebody has to pay the bill in dollars and cents. Whether it is a property tax or utility usage bill, somebody has to pay the bills, and it will be every person and business that turns on their taps and flushes their toilets. Our report's numbers reflect the true cost for the average SFD property owner and business property owner. If they choose utility billing, it will be for the average consumption.  Again, somebody has to pay the bills no matter how you split the costs. And it will be the taxpayer.