WLNG 10-Year Agreement in Principle

A proposed 10-year arrangement with Woodfibre LNG (WLNG) for a pre-committed amount of revenue to the District of Squamish (District), consisting of two components:

• Community Enhancement Payment Agreement
• Revitalization Tax Exemption program

Now that negotiations are complete, Council will decide to approve or not approve the proposed arrangement, following receipt of community feedback.

The decision will be made by Council in early October after community feedback is received. It is currently anticipated that Council will consider the first three readings of the proposed RTE bylaw on September 22 and, if three readings are passed, Council will make a final decision on both the RTE bylaw and CEPA in early October.

Yes. Community members can provide written comments to Council using the feedback form on this page.

The proposed arrangement is a result of negotiations and, if approved, is intended to take effect in the 2027 tax year. The Community Charter, provincial legislation that governs local governments, requires that this be approved and implemented before October 31 if it is to take effect in 2027. The inaugural meeting of the new Council is not until November. 

CEPA is an agreement between the District and WLNG under which WLNG commits to make scheduled payments to the District towards future community enhancement projects.

View the proposed CEPA.

The RTE is a legislative tool authorized under section 226 of the Community Charter that temporarily reduces the municipal portion of property taxes for 10 years. RTEs have been used by local governments to encourage investment and revitalization of parts of the community.

View the proposed RTE bylaw.

The objective of the proposed arrangement is to deliver payments over 10 years that would provide predictability to both parties. The combination of the two different aspects works to achieve this. The RTE provides a mechanism to limit annual property taxes while the CEPA is a commitment to provide voluntary payments by WLNG for community benefit. 

The only lands covered by this arrangement would be lands, including land covered by water, that are owned or held by WLNG or on behalf of WLNG that are located within the area shown on the map below:

Money received under the CEPA would need to be spent exclusively on any capital improvement project chosen by the District in accordance with its capital plan. The CEPA money could not be utilized to fund regular operations.

Each year, the District prepares and Council considers and adopts a 10-year Financial Plan. Big drivers of our recent capital plans include:

• Water, wastewater, storm water system repairs & replacements
• Flood protection improvements
• Recreation investments
• Transportation upgrades
• Climate adaptation and mitigation 

The total amount of payments under the CEPA will be $117 million paid as follows:

The intent of Article 6 of the CEPA is to avoid duplication of payment by WLNG to the District. In the event that future municipal taxes exceed the agreed to annual amount under the CEPA, the District would be required to repay the equivalent portion of payments it received under the CEPA.

The repayments cannot exceed payments received under CEPA or property taxes, so while WLNG will not be required to pay twice, the District will never have to repay more than it collects in any given year.

This arrangement would not involve any naming rights for WLNG or sponsorship status in relation to any project, though the District may acknowledge that a project is partially funded by money received from WLNG.

These documents are a result of negotiations between the District and WLNG and can either be accepted or not accepted but cannot be unilaterally amended by the District at this point.

The arrangement requires both the CEPA and RTE program, so if either one is not approved, the entire arrangement cannot proceed.

Without the proposed arrangement, the District would continue to rely on regular property taxation.

The RTE program objectives are set out in the proposed RTE bylaw (section 3) as follows:

a.    Encourage redevelopment and revitalization of environmentally contaminated industrial lands formerly occupied by the Woodfibre Paper Mill;

b.    Increase economic opportunities, capacity building, and prosperity of the community to create an economically diverse and stable community; 

c.    Maximize the financial contribution to the District from the LNG Plant; 

d.    Encourage investment in the community by Woodfibre LNG, including through Community Enhancement Payments made under the CEP Agreement;

e.    Increase local employment opportunities, including through opportunities that are currently available or are expected to become available in the future at the LNG Plant that is being constructed on the Lands; and

f.    Further support the redevelopment of the Lands, which are located on a brownfield site. 

Yes. In accordance with section 226 of the Community Charter, upon meeting certain conditions, WLNG properties will be exempt from any municipal property taxes above $2.5 million a year (adjusted for inflation after 2027) during the ten-year period the RTE program is in effect.

To be eligible for the tax exemption the owner has to operate an LNG plant on the lands and must comply with all the requirements of the RTE agreement (as prescribed under the RTE bylaw) and the CEPA.

The District would collect at least $25 million in municipal property taxes during the ten-year term of the agreement. The exact amount is not known at this time because the annual tax amount will be adjusted after 2027 to account for annual inflation, which is unknown at this time.

If the proposed arrangement is approved, the District would receive $117 million under CEPA and at least $25 million in municipal property taxes, for the total of at least $142 million over the ten years of the arrangement.

This is not known with certainty because there are many variables, scenarios and combinations that make this challenging to forecast. Absent an agreement, property tax values are not known because assessment values are established by BC Assessment annually, and tax rates are determined by Council annually. 

Hypothetically however, if we assume for estimation purposes that the WLNG assessment value at build out could potentially be between $400M and $600M*, the District could collect an estimated range of anywhere between $10M to $15M on average annually over the course of a 10-year period in taxation across all relevant classes**. The ranges above consider average tax rates and a range of possible assessment values to provide context. However, these numbers are ultimately unknowable. The numbers fluctuate annually and could be higher or lower in the future.  

*Estimation only 

**Includes Class 4 Major Industry, Class 2 Utilities, and Class 6 Business/Other. This is based on the 2026 BC average tax rates in all relevant classes, noting that the BC average rates change year to year. 

No. Payments under the CEPA would be voluntary contributions that WLNG has agreed to in order to support District community enhancement projects. They are not imposed by law as a tax.

Once the CEPA is finalized by both sides, they would be contractually enforceable. Payments under CEPA would be a debt due and owing to the District and can be collected through legal processes if not paid.

Unless remedied within 30 days, failure by WLNG to make any of the payments under the CEPA, would result in a loss of tax exemption under the RTE program. The District could also initiate a legal process to collect the payments if necessary.

Municipal property taxes are calculated each year by applying an annual tax rate, established each year by District Council, to property values that are determined by BC Assessment, a public authority that is independent of the District.

In 2026, WLNG paid $7.7 million in municipal property taxes to the District.

Property assessment is done by BC Assessment, a public authority independent of the District, based on the value of lands and improvements.

No. The payments under CEPA are as set out in the agreement and would not be adjusted, up or down, based on inflation or for any other reason.

As long as the property continues to be used for the LNG plant and all other conditions of the CEPA and RTE Program are met, including payments under the CEPA, the property would continue to be exempt under the RTE program for the term of the agreement.

If part of the property is transferred to another entity and is no longer part of the LNG plant operations, it would be excluded from both the CEPA and RTE program and taxable in the normal way. The CEPA payments or tax payable by WLNG would not be adjusted if part of the property is excluded from the arrangement.

WLNG has commenced legal proceedings against the District in relation to taxation in 2025 and 2026 and other matters. If the proposed arrangement is approved by Council, these proceedings would be discontinued. 

The District would not be required to repay or adjust any taxes levied in 2025 or 2026 that were challenged as part of these proceedings.

The proposed arrangement is a result of negotiations that were initiated long before commencement of the current lawsuits and is intended to achieve predictability for both the District and WLNG. Resolution of the existing lawsuits would be a byproduct of the proposed arrangement.

Any agreement could be modified with the consent of both parties, however, it could not be unilaterally modified by a future Council and, if approved, would be in effect for the next 10 years.

Variability is a key feature of relying on annually set property tax rates and fluctuating property assessments. Setting a tax rate each spring is a decision of Council which would provide the ability to adjust rates to the current property assessment each year to maximize property tax revenue.  

There could be risks inherent in the property tax system, however, when dealing with large taxpayers such as WLNG. These may include:

• Lack of certainty with how WLNG’s properties would be classified or valued as part of the annual assessment by BC Assessment, a public authority independent of the District, including a risk that WLNG’s operation may qualify as “major LNG plant” for future assessment purposes, which would significantly change future valuation of WLNG improvements.
• Potential for future challenges, under the Assessment Act, to BC Assessment valuation or classification of WLNG properties which could result in lower than expected assessed values.
• Cost and uncertainty of existing and potential future litigation with WLNG over municipal tax rates set by the District.
• Potential that senior levels of government may impose a capped tax rate on LNG projects, similar to caps on Class 2: Utilities, or Class 4: Major Industry – Ports.

Certainty of revenue is a key feature of the negotiated arrangement. The CEPA would provide a predictable stream of payments from WLNG to the District, and would provide higher payments in the early years of the arrangement. Increased certainty of revenue timing and amounts would provide confidence to the District when planning and funding the long-term financial plan, including capital infrastructure projects and reserves. Acceptance of the arrangement would also resolve the existing lawsuits which would free up District resources in the coming months or years. 

There could be risks inherent in the CEPA and RTE arrangement. These may include:

• The potential that future assessments and the setting of an annual tax rate would result in higher property taxes being levied on WLNG than what is pre-committed to.
• The potential that the possible risks that are inherent in the property tax process (listed in Question No. 34 above) won’t come to fruition. 
• Constraint for 10 years of the agreement. 

Comparing heavy industry tax rates between communities with any degree of relevancy is difficult as the context is unique from place to place. Factors such as the number of industries in a class, dependency of a town’s taxation on industry, and the impact the industry has on a community’s built infrastructure, for example, all contribute to how rates are established. 

The Province of BC collates and reports the data about property tax rates at different communities

2026 tax rates for all classes in Squamish can be found on the Property Taxes and Utilities page.

There is no renewal clause included in the agreement. There is nothing in the proposed arrangement that commits the District to anything, or limits future Council’s discretion, at expiry of this arrangement. Therefore, any decision about any future arrangements will be made in 10 years.