By: CBC News
A 50 per cent reduction in the value of the Resolute Forest Products mill in Thunder Bay will cost the city millions of dollars.
Earlier this month, the Assessment Review Board handed down a decision that slashes the property value by almost $40 million, for the 2009 to 2012 tax years.
Thunder Bay city councillors voted in a closed session this week to accept the ruling.
Reserve funds will cover the cost of paying back the taxes, but that pot of money is dwindling, city manager Tim Commisso told CBC News.
“The challenge we have is ‘what’s the future hold?’ Because there’s a whole bunch of assessments that are under appeal, what will ultimately happen with those decisions,” he said. “We’re not sure.”
The review board’s written decision shows that Resolute was seeking a valuation of $27.5 million for the property, while the Municipal Property Assessment Corporation valued the mill at just under $37.5 million. The city argued the mill should continue to be valued at $72.2 million.
The review board settled on a value of $32.6 million for the four-year period.
The Thunder Bay mill was once worth more than $100 million.
Using reserve funds to cover the refund means it won’t cost city residents, Commisso said.
“So, no, it won’t have any direct impact on taxes. The only way it would impact on taxes quite frankly is if there’s a change in the current assessment on the plant …. It’s under appeal so you never know,” he said.
Draining the reserves could impact the city in other ways, Commisso noted, including how much money the city can put aside for other projects, like increasing spending on infrastructure.
“I think it’s significantly impacted,” he said.
The city won’t say how much it has to pay back to Resolute, because it doesn’t t publicly disclose information on individual tax payers, said Commisso.
Municipal officials are working with the province of Ontario to try and make the assessment process more consistent, he noted.
By: CBC News