Comment: First Saanich taxes employers out. Then it asks how we're doing

A business can end up paying taxes influenced by the property's redevelopment value while receiving none of the benefit from that increased value. A commentary by Greg Fraser, the chief executive officer of Industrial Plastics and Paints. Saanich municipal staff have begun visiting local employers under a new program called BusinessCare. Its message is reassuring: 'Your business matters, and we're listening.' Economic development staff offer a 'confidential, 30-45 minute conversation' about the challenges facing local businesses. I do not fault those employees for doing the job council assigned them. I am prepared to have that conversation. But council should be prepared to hear an uncomfortable answer. Saanich does not need another round of consultations to understand the problem. Its land use and property tax policies are making it increasingly difficult for established employers to remain here. Saanich adopted the Uptown Douglas Plan in 2022 as a 20- to 30-year vision for the corridor. Among its central directions is 'leading growth with residential' through pre-zoning that embeds desired housing densities. The Uptown Core is explicitly identified as an area for elevated density and intensification through redevelopment. More housing and better use of centrally located land are legitimate goals. The problem is how Saanich expects the businesses occupying that land today to carry the cost of tomorrow's redevelopment. B.C. Assessment does not simply value commercial land according to the business presently operating on it. Its published policy says land must be valued according to its 'highest and best use as vacant.' Where higher-density redevelopment becomes legally permissible and reasonably probable, that potential can be reflected in market value and, ultimately, assessed value. Saanich council does not directly set B.C. Assessment values. It does, however, control the Official Community Plan, zoning and pre-zoning decisions that create development potential. It also sets the municipal property tax rates applied to those values. The result is that an operating business can end up paying taxes influenced by the property's redevelopment value while receiving none of the benefit from that increased value. The landlord might eventually realize the increase in land value. A developer might someday construct the apartment tower. But under the net leases commonly used for commercial premises, the existing business tenant pays the property tax bill today. In effect, businesses are being taxed on buildings that do not yet exist. In the four years since Saanich adopted the Uptown Douglas Plan, assessments on some established commercial properties in the corridor have skyrocketed. The businesses occupying those sites did not suddenly become twice as large or twice as profitable. What changed was the value assigned to the land and its redevelopment potential, leaving the existing occupier to carry the resulting increase in property tax. Most of the businesses Saanich says it wants to retain are not large corporations. The district's own economic assessment found that nearly nine in 10 Saanich establishments with employees have fewer than 20 workers. Now consider what Saanich's tax rate means for those employers. Its published 2026 rate for Class 6 business property is about $22.84 per $1,000 of assessed value, compared with $5.20 for residential property. Put more simply, the business rate is about 4.4 times higher. Industrial Plastics and Paints is a 75-year-old local employer, a family-owned business and an industrial supplier serving manufacturers, trades, contractors and retail customers across Vancouver Island. This is not a hypothetical concern. At our location at 776 Cloverdale, the assessed value of our premises rose from $3.9 million in 2021 to more than $7 million in 2025, an increase of 80 per cent. Over the same four years, the annual property tax bill rose from about $76,500 to $148,000. It very nearly doubled. The assessment eased in 2026, but the current tax bill remains about $135,000, or 76 per cent higher than it was in 2021. The building did not get larger, and the business did not become more profitable in proportion to its tax bill. What changed was the assessment, which increasingly reflected the property's redevelopment potential and what B.C. Assessment calls its 'highest and best use' value. Under a typical net lease, that tax is paid by the tenant out of revenue, not profit. The business must still pay its employees, purchase inventory, move freight and cover rent, insurance, utilities and every other operating expense before earning a dollar of profit. The tax is based on the value of the property, with no regard for the tenant's sales or ability to absorb it. Not every dollar of the total tax bill is retained or controlled by Saanich. It includes school, transit, regional and other levies. But even the municipal and police component levied in Saanich is about 4.7 times the residential rate. The rate also matters competitively, especially when compared with municipalities on Vancouver Island competing for many of the same employers. Saanich's total 2026 Class 6 rate is about $22.84 per $1,000 of assessed value. Central Saanich's is $13.99, Langford's about $15.47, North Cowichan's about $17.02 and Victoria's $19.88. On an identical assessed value, Saanich would produce about 63 percent more tax than Central Saanich, 48 percent more than Langford, 34 percent more than North Cowichan and 15 percent more than Victoria. Assessments and local charges differ, but the comparison helps explain why employers looking for industrial or commercial space may conclude that the cost of remaining in Saanich is no longer competitive. At Industrial Plastics and Paints, we are living the consequences of these numbers as the lease on our longstanding location at 776 Cloverdale approaches its end. We must decide whether our employees, inventory, showroom, warehousing and online fulfilment operations can remain together in Saanich or must be moved to municipalities where the cost of doing business is more reasonable. We must weigh that financial reality against our responsibility to the customers who have supported us throughout our 75 years in business. These are not abstract planning questions. They are decisions about where our employees will work, how our customers will access our products and services, and whether a long-established employer can afford to remain in Saanich. Over the past three years, the corridor may have lost as many as 375 jobs through major business closures and relocations. Only now is Saanich sending out its BusinessCare team, brochures in hand, to ask the businesses that remain how it can help. That is not business retention. It is an exit interview. If Saanich is serious about retaining employers, it must change the policies that drive up costs while there is still time to keep them. Council might not have intended to drive businesses away. But when employers run the numbers and conclude they cannot afford to remain, intent does not change the result. They leave. BusinessCare can still become useful, but only if it produces measurable policy changes. There are practical steps council can take now. First, council should direct staff to determine how many occupied Saanich properties qualify for the province's development potential relief program and bring forward a relief bylaw for the 2027 tax year. The program allows municipalities to reduce the general municipal tax rate on eligible commercial and light-industrial land where development potential dominates the assessment. The program has strict eligibility rules, which apply only to the general municipal portion of the tax bill and is limited to five years. It will not solve the entire problem, but it could provide a bridge for qualifying businesses. If the provincial rules exclude most of the properties facing this pressure, council should say so publicly and ask the province to broaden them. Second, Saanich should publish an annual employment and business-retention report. It should track business openings, closures and relocations, changes in occupied commercial and industrial floor area, and the estimated number of jobs gained or lost. Counting consultations is not an economic-development result. Retaining or growing employers is. Third, council should adopt a public target for narrowing the gap between Saanich's business and residential municipal tax rates. Each annual budget should show whether that gap is growing or shrinking and explain why. Council should also require a tax-impact assessment before approving pre-zoning or other land-use changes expected to produce major increases in commercial land value. That assessment should estimate the effect on existing occupiers and identify measures available to reduce the impact. Council should understand what its planning decisions could do to the businesses already there before those decisions are made. Finally, Saanich must turn its promise to conserve light industrial uses into measurable requirements. Redevelopment policies should protect a meaningful amount of employment space and ensure that replacement space can actually function. Industrial suppliers, trades and service businesses need loading access, parking, ceiling height, storage and adequate floor area. A small storefront beneath an apartment tower is no substitute for a warehouse, loading area or working industrial showroom. Saanich needs more housing, and density belongs in the Uptown Douglas corridor. But today's employers should not be forced to finance a redevelopment vision that may take decades to materialize. Saanich says businesses are the backbone of its economy. Council cannot tax them as though they exist to fund today's spending while treating them as obstacles to redevelopment tomorrow. Listening is welcome. But businesses will not remain because council listened. They will remain only if council changes the cost of staying.