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B.C. Reg. 53/2016
O.C. 127/2016
Deposited March 2, 2016
This consolidation is current to November 12, 2019.

Assessment Act

Depreciation of Industrial and Electrical Power Generating Facility Improvements Regulation

Contents
1Definitions
2Major industrial plants other than major LNG plants
3Major LNG plants that have not commenced operation
4Major LNG plants that have commenced operation
5Dams
6Power plants
7Substations
8Depreciation in relation to certain electrical power generating facilities
9Closure allowances
10Rounding down amounts
Schedule 1
Schedule 2
Schedule 3
Schedule 4
Schedule 5

Definitions

1   In this regulation:

"Act" means the Assessment Act;

"chronological age" means,

(a) in relation to an industrial improvement or part of an industrial improvement that is part of a major industrial plant, the number of years determined by subtracting from the year in which the new assessment roll is completed whichever of the following years applies:

(i) in the case of an industrial improvement or part of an industrial improvement that was constructed or installed before the plant commenced operation, the year in which the plant commenced operation;

(ii) in the case of an industrial improvement or part of an industrial improvement that was constructed or installed after the plant commenced operation, the year in which the construction or installation of the industrial improvement or part of an industrial improvement was completed, and

(b) in relation to an improvement or part of an improvement that is part of an electrical power generating facility, the number of years determined by subtracting from the year in which the new assessment roll is completed whichever of the following years applies:

(i) in the case of an improvement or part of an improvement that was constructed or installed before the facility commenced operation, the year in which the facility commenced operation;

(ii) in the case of an improvement or part of an improvement that was constructed or installed after the facility commenced operation, the year in which the construction or installation of the improvement or part of an improvement was completed;

"dam" means a dam as defined in section 20.1 of the Act to which that section applies;

"effective age", in relation to an industrial improvement or an electrical power generating facility improvement, means the number of years determined by

(a) calculating the total cost of the improvement,

(b) multiplying the chronological age of each part of the improvement by the cost of that part to give the weighted age of that part,

(c) adding the weighted ages of all of the parts of the improvement, and

(d) dividing the sum of the weighted ages by the total cost of the improvement and rounding the quotient up to the next whole year to yield the effective age of the improvement;

"electrical power generating facility" means a dam, a power plant or a substation;

"electrical power generating facility improvement" means an improvement that is part of an electrical power generating facility;

"industrial improvement" has the same meaning as in section 20 of the Act;

"LNG improvement" means an industrial improvement that is part of a major LNG plant or is part of an industrial improvement that is part of a major LNG plant;

"major industrial plant" means a plant designed and built for a purpose described in paragraphs (a) to (q) of the definition of "industrial improvement" in section 20 (1) of the Act;

"major LNG plant" means a major industrial plant that is designed

(a) to process natural gas, and

(b) to produce at least 4 million tonnes of liquefied natural gas per year,

and includes associated facilities used for the loading of liquefied natural gas onto sea going ships or barges and storage facilities that are ancillary to those loading facilities;

"power plant" means a power plant as defined in section 20.1 of the Act to which that section applies;

"substation" means a substation as defined in section 20.1 of the Act to which that section applies;

"wind power plant" means a power plant that uses a wind turbine to generate or supply electricity from the wind.

Major industrial plants other than major LNG plants

2   (1) In this section, "category", in relation to a major industrial plant, means the category of the plant set out in column 1 of Schedule 1 by reference to the primary purpose for which the plant was designed and built, being a purpose described in the definition of "industrial improvement" in section 20 (1) of the Act.

(2) Subject to section 9, this section prescribes, for the purposes of section 20 of the Act, the depreciation rate for an industrial improvement other than an LNG improvement.

(3) Subject to subsection (4), the depreciation rate is to be calculated as follows:

depreciation rate = percentage rate × age
where
age=the chronological age of the improvement or, if the parts of the
improvement have different chronological ages, the effective
age of the improvement;
percentage rate=the percentage rate set out in column 2 of Schedule 1 opposite
the category of the major industrial plant of which the
improvement is a part.

(4) If the depreciation rate determined in accordance with subsection (3) is equal to or greater than 80%, the depreciation rate is 80%.

Major LNG plants that have not commenced operation

3   (1) This section prescribes, for the purposes of section 20 of the Act, the depreciation rate for an LNG improvement that is part of a major LNG plant that has not commenced operation.

(2) The depreciation rate is 40% for the year that the construction or installation of the LNG improvement commences and for each following year up to and including the year before the year that the major LNG plant commences operation.

Major LNG plants that have commenced operation

4   (1) Subject to section 9, this section prescribes, for the purposes of section 20 of the Act, the depreciation rate for an LNG improvement that is part of a major LNG plant that has commenced operation.

(2) The depreciation rate for an LNG improvement whose construction or installation commenced before or in the year that the major LNG plant commenced operation is the rate set out in column 2 of Table 1 in Schedule 2 opposite the year set out in column 1 of that table.

(3) The depreciation rate for an LNG improvement whose construction or installation commenced in a year after the year that the major LNG plant commenced operation is the rate set out in column 2 of Table 2 in Schedule 2 opposite the year set out in column 1 of that table.

Dams

5   (1) In this section, "maximum depreciation rate", in relation to an improvement that is part of a dam, means the rate set out in column 3 of Schedule 3 opposite the description of the improvement in column 1 of that Schedule.

(2) Subject to sections 8 and 9, this section prescribes, for the purposes of section 20.1 of the Act, the depreciation rate for an improvement that is part of a dam.

(3) Subject to subsection (4), the depreciation rate is to be calculated as follows:

depreciation rate = percentage rate × age
where
age=the chronological age of the improvement or, if the parts of the
improvement have different chronological ages, the effective
age of the improvement;
percentage rate=the percentage rate set out in column 2 of Schedule 3 opposite
the description of the improvement set out in column 1 of that
Schedule.

(4) If the depreciation rate determined in accordance with subsection (3) for an improvement is equal to or greater than the maximum depreciation rate for the improvement, the depreciation rate for the improvement is the maximum depreciation rate.

Power plants

6   (1) In this section, "maximum depreciation rate", in relation to an improvement that is part of a power plant, means the rate set out in column 3 of Schedule 4 opposite the description of the improvement in column 1 of that Schedule.

(2) Subject to sections 8 and 9, this section prescribes, for the purposes of section 20.1 of the Act, the depreciation rate for an improvement that is part of a power plant.

(3) Subject to subsection (4), the depreciation rate is to be calculated as follows:

depreciation rate = percentage rate × age
where
age=the chronological age of the improvement or, if the parts of the
improvement have different chronological ages, the effective
age of the improvement;
percentage rate=the percentage rate set out in column 2 of Schedule 4 opposite
the description of the improvement set out in column 1 of that
Schedule.

(4) If the depreciation rate determined in accordance with subsection (3) for an improvement is equal to or greater than the maximum depreciation rate for the improvement, the depreciation rate for the improvement is the maximum depreciation rate.

Substations

7   (1) In this section:

"age", in relation to an improvement, means the chronological age of the improvement or, if the parts of the improvement have different chronological ages, the effective age of the improvement;

"applicable table", in relation to an improvement, means the table in Schedule 5 whose title describes the improvement.

(2) Subject to sections 8 and 9, this section prescribes, for the purposes of section 20.1 of the Act, the depreciation rate for an improvement that is part of a substation.

(3) Subject to subsection (4), the depreciation rate is the rate set out in column 2 of the applicable table in Schedule 5 opposite the age of the improvement set out in column 1 of that table.

(4) If the assessor determines, as of October 31 in any year, that an electrical transformer that is part of a substation, other than a substation that is part of an electrical power generating facility described in section 8 (1), has a design capacity that is at least 100% greater than the peak megavolt amp load requirement of that transformer during the previous 12 months, the cost of that transformer must be reduced by 25% before application of the depreciation rate determined under subsection (3) for valuation of that transformer for the next assessment roll.

(5) Subsection (4) applies only if a transformer is installed to service a load requirement or anticipated load requirement, and, subsequent to the installation,

(a) the load requirement diminishes, or

(b) the anticipated load requirement does not occur.

Depreciation in relation to certain electrical power generating facilities

8   (1) The cost of improvements that are part of each of the following electrical power generating facilities must be reduced by 15% before the application of the depreciation rate determined under section 5, 6 or 7 or subsection (2) of this section:

(a) Lower Bonnington (Plant 1);

(b) Upper Bonnington (Plant 2);

(c) South Slocan (Plant 3);

(d) Corra Linn (Plant 4).

(2) Subject to section 9, the amount of depreciation to be applied to the following electrical power generating facility improvements must be determined by the assessor using generally accepted appraisal methods:

(a) improvements that are part of a dam that has an actual electrical power generating capacity of 6 or less megawatts per hour;

(b) improvements not specifically described in Schedule 3, 4 or 5, as applicable.

Closure allowances

9   (1) If the assessor determines that a major industrial plant or an electrical power generating facility

(a) is closed on or before October 31 in any year and the owner of the plant or facility or a senior executive officer of the corporation that owns the plant or facility confirms in writing that the closure is permanent, or

(b) has been closed for a minimum of 3 consecutive years immediately preceding October 31 in any year and the owner of the plant or facility or a senior executive officer of the corporation that owns the plant or facility confirms in writing that the plant or facility is closed and the duration of that closure,

for the purpose of the assessment roll in the succeeding year, the depreciation applicable to the improvements that are part of the plant or facility is the amount sufficient to reduce the actual value of the improvements to 10% of the cost of the improvements.

(2) If the assessor determines that a separate industrial improvement or a separate electrical power generating facility improvement

(a) is closed or shut down on or before October 31 in any year and the owner or manager of the major industrial plant or electrical power generating facility of which the improvement is a part confirms in writing that the closure or shutdown is permanent, or

(b) has been closed or shut down for a minimum of 3 consecutive years immediately preceding October 31 in any year and the owner or manager of the major industrial plant or electrical power generating facility of which the improvement is a part confirms in writing that the improvement is closed or shut down and the duration of that closure or shutdown,

for the purpose of the assessment roll in the succeeding year, the depreciation applicable to the separate improvement is the amount sufficient to reduce the actual value of the improvement to 10% of the cost of that improvement.

(3) Subsection (2) applies only with respect to a complete industrial improvement or electrical power generating facility improvement and must not be applied to a part of an industrial improvement or a part of an electrical power generating facility improvement.

(4) A confirmation referred to in subsection (1) or (2), as applicable, must

(a) be made to the assessor of the assessment area in which the major industrial plant or electrical power generating facility, as the case may be, is located,

(b) be made by November 30 next following the October 31 referred to in subsection (1) (a) or (b) or (2) (a) or (b), as applicable,

(c) in the case of a confirmation under subsection (1) (a) or (2) (a), specify the date of the permanent closure or shutdown, and

(d) in the case of a confirmation under subsection (1) (b) or (2) (b), specify the commencement date and duration of the closure or shutdown.

(5) Despite subsection (4), if

(a) a major industrial plant or electrical power generating facility that has been previously closed is reopened, or

(b) a separate industrial improvement or electrical power generating facility improvement that has been previously closed or shut down is reopened or reactivated,

this section ceases to apply for the purposes of the assessment roll in the succeeding year.

Rounding down amounts

10   For the purposes of sections 20 (4) and 20.1 (3) of the Act, the assessment authority must round the actual value of an industrial improvement or an electrical power generating facility improvement that has been calculated by applying a rate of depreciation prescribed by this regulation

(a) down to the nearest $100, if the actual value determined is greater than $101 and less than $99 999, and

(b) down to the nearest $1 000, if the actual value determined is $100 000 or greater.

Schedule 1

[Section 2]

Depreciation Rates for Industrial Improvements

Item Column 1
Category of Major Industrial Plant
Column 2
Percentage
rate (%)
1(a) mining, extracting, beneficiating or milling of metallic or non-metallic ore6.5
2(b) mining, breaking, washing, grading or beneficiating of coal4.0
3(c) producing of aluminum3.0
4(d) smelting or refining of metal from ore or ore concentrate3.0
5(e) producing, manufacturing, processing or refining of petroleum or natural gas3.0
6(f) manufacturing of lumber or other sawmill and planing mill products4.0
7(g) manufacturing of wood veneer, plywood, particle board, wafer board, hardboard and similar products4.0
8(h) manufacturing of gypsum board3.0
9(i) manufacturing of pulp, paper or linerboard3.0
10(j) manufacturing of chemicals4.0
11(k) manufacturing of chemical fertilizer3.0
12(l) manufacturing of synthetic resins or the compounding of synthetic resins into moulding compounds3.0
13(m) manufacturing of cement3.0
14(n) manufacturing of insulation3.0
15(o) manufacturing of sheet glass or glass bottles3.0
16(p) building, refitting or repairing ships5.0
17(q) (i) loading of cargo onto sea going ships or barges, including associated cargo storage and loading facilities5.0
18(q) (ii) the maritime structure of a grain terminal operation including piers, wharves, shipping galleries and loading gallery towers used to transport grain from a grain elevator to sea going ships or barges, but excluding grain elevators and associated structures5.0
19(q) (iii) grain elevators and associated structures2.5

Schedule 2

[Section 4]

Depreciation Rates for Major LNG Improvements

Table 1

ItemColumn 1
Year
Column 2
Depreciation
rate (%)
1Year that plant commenced operation and following 14 years40
215th year after year that plant commenced operation48
316th year after year that plant commenced operation56
417th year after year that plant commenced operation64
518th year after year that plant commenced operation72
619th year after year that plant commenced operation and following years80

Table 2

ItemColumn 1
Year
Column 2
Depreciation
rate (%)
1Year that construction or installation of improvement commenced and following 14 years40
215th year after year that construction or installation of improvement commenced48
316th year after year that construction or installation of improvement commenced56
417th year after year that construction or installation of improvement commenced64
518th year after year that construction or installation of improvement commenced72
619th year after year that construction or installation of improvement commenced and following years80

Schedule 3

[Sections 5 and 8]

Depreciation Rates for Dam Improvements

ItemColumn 1
Improvement
Column 2
Percentage rate
(%)
Column 3
Maximum
depreciation
rate (%)
1Dam — Structure
(i) well maintained
(ii) average maintenance

0.70
0.70

45
50
2Head Gates1.2565
3Surge Tank1.2565
4Steel Penstock2.0065
5Polyethylene (PE) Penstock2.0065
6Wood Penstock2.0075
7Tunnel
(i) well maintained
(ii) average maintenance

0.70
0.70

45
50
8Concrete Tunnel Liner2.0065
9Steel Tunnel Liner1.5065

Schedule 4

[Sections 6 and 8]

Depreciation Rates for Power Plant Improvements

ItemColumn 1
Improvement
Column 2
Percentage rate
(%)
Column 3
Maximum
depreciation
rate (%)
1Improvement that is part of a power plant other than a wind power plant1.2565
2Improvement that is part of a wind power plant2.2565

Schedule 5

[Sections 7 and 8]

Depreciation Rates for Substation Improvements

Table 1

Buildings — Steel Frame

ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
110
22 and 31
342
45 and 63
574
68 and 95
7106
8117
9128
10139
111410
121511
131612
141713
151814
161916
172017
 
ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
182118
192220
202321
212423
222525
232627
242728
252830
262932
273034
2831 and 3238
2933 and 3445
3035 and 3648
3137 and 3853
3239 and 4059
33greater than 4065

Table 2

Buildings — Pre-Engineered

ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
111
222
334
445
556
668
7710
8811
9913
101015
111117
121219
131322
141424
 
ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
151526
161628
171731
181834
191936
202039
212142
222245
232348
242452
252555
262658
272761
28greater than 2765

Table 3

Masonry — Load Bearing

ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
111
222
333
444
555
666
777
888
9910
101011
111113
121214
131316
141418
151520
161622
 
ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
171724
181826
191928
202030
212132
222235
232337
242440
252543
262646
272749
282852
292954
303057
3131 and 3262
32greater than 3265

Table 4

Transformers

ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
11 and 21
232
343
45 and 64
575
686
797
8108
9119
101210
111312
121413
131514
141616
151718
161819
171921
 
ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
182023
192125
202227
212329
222431
232533
242635
252737
262840
272942
2830 and 3145
2932 and 3350
303455
313560
323665
333770
34greater than 3775

Table 5

Breakers

ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
111
222
334
445
556
668
7710
8811
9913
101015
111117
121219
131322
141424
151526
161628
 
ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
171731
181834
191936
202039
212142
222245
232348
242452
252555
262658
272761
282862
292968
3030 and 3172
31greater than 3175

Table 6

Grounding, Transformation Positions and Breaker Positions

ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
110
22 to 51
36 to 82
49 and 103
511 and 124
613 and 145
7156
816 and 177
9188
1019 and 209
112110
122211
132312
142413
152514
162615
172716
182817
 
ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
192918
203020
2131 and 3222
2233 and 3425
2335 and 3628
2437 and 3832
2539 and 4035
2641 and 4239
2743 and 4443
2845 and 4648
2947 and 4853
3049 and 5056
3151 and 5260
3253 and 5465
3355 and 5668
3457 and 5872
35greater than 5875

Table 7

Light Metal Sheds

ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
111
222
334
445
556
668
7710
8811
9913
101015
111117
121219
131322
141424
151526
161628
 
ItemColumn 1
Age of
improvement
(years)
Column 2
Depreciation
rate (%)
171731
181834
191936
202039
212142
222245
232348
242452
252555
262658
272761
282864
292968
303072
31greater than 3075

[Provisions relevant to the enactment of this regulation: Assessment Act, R.S.B.C. 1996, c. 20, sections 20, 20.1 and 74]