Delta will be losing some of the taxes it collects from B.C. Ferries properties, but the reduction could have been much worse.

The B.C. Assessment Authority announced last week it has reached a compromise on assessments for all B.C. Ferries terminals throughout the province after an uproar in West Vancouver last year.

The compromise means Delta will likely lose about $135,000 in property taxes from B.C. Ferries' two South Delta properties.

"It will have undoubtedly some impact, but it certainly isn't catastrophic," said Coun. Bruce McDonald.

South Delta is home to the Tsawwassen ferry terminal and a maintenance facility, which had a total assessed value in 2013 of just over $64 million. Last year Delta received about $688,000 in property taxes from B.C. Ferries.

The revised assessment for the South Delta properties has gone down to $51.6 million. According to Delta's finance department, that reduction, based on the 2012 tax rate, would mean roughly $135,000 in lost taxes.

It's not a huge hit, considering a one per cent loss in total municipal taxes works out to around $1.1 million.

The assessment authority says a compromise was reached on ferry properties at the request of the provincial government.

The discussion began as a result of a highly controversial decision by the politically appointed Property Assessment Appeal Board late last year, which slashed the assessment of the two properties comprising the Horseshoe Bay ferry terminal to just $20, down from the B.C. Assessment Authority's figure of over $47 million.

That decision meant the District of West Vancouver could no longer collect property taxes from B.C. Ferries, which would have been approximately $250,000 for 2013.

In a statement at the time, West Van noted the board based its ruling on the grounds that the properties "have no market value because they have no other purpose other than as a ferry terminal and there is no potential for profit."

Calling the reasoning ridiculous, West Vancouver Mayor Michael Smith warned that other municipalities that host B.C. Ferries facilities would be in the same situation.

The agreement announced last week means the Horseshoe Bay terminal's assessed value goes back up to around $47 million, although it would have been $50 million in 2013. The new deal also means Delta won't face a similar scenario to what West Vancouver endured.

McDonald said although the reduction in the assessed value is a hit, it's still a reasonable compromise.

"When they took the Horseshoe Bay terminal to $20, if they (B.C. Ferries) had been steadfast in that and moved along, it would have been a horrendous hit to all the communities that have terminals," he said. "In this case the province said, 'No, we have to fix this.' The impression I have in talking to people is that this is a good solution at this present time."

When the ferry corporation was a Crown corporation, it only paid Delta about $200,000 in lieu of taxes, but the terminals became subject to municipal taxes when the corporation became a private entity.

In 2005, B.C. Ferry Services Inc., the private entity that took over ferry operations from the Crown corporation, appealed the assessment of the Tsawwassen terminal. It argued the terminal should have an assessed value of zero, but eventually reached a deal with the B.C. Assessment Authority.

Delta had no say in the matter as the value of the facility at the time was cut in half, from $96.8 million to $47.7 million, which resulted in an annual loss of $600,000 in taxes.