Under the Shadow Bid model, the private sector pays taxes to the government based on the project revenues and expenses. Taxes are thus additional costs to the bidder and are included in the Shadow Bid. In contrast, if the government procures the project through traditional means, during the operating period it will not receive the provincial tax revenue nor the secondary benefits from the federal taxes collected that it would if the private sector had been awarded the project. These foregone taxes represent an opportunity cost to the public sector. An adjustment is therefore made to account for the foregone taxes in order to accurately reflect the total cost of the PSC. Partnerships BC's approach to this adjustment is based on applying 50 per cent of the Federal, and 100 per cent of the Provincial tax rate. Where appropriate, this approach can be adjusted on a case-by-case basis if there are specific project-related rationale determined by a project team that can be documented.