Port Alice council held an in-camera meeting Dec. 14 regarding the 25 per cent tax reduction agreement with Neucel Specialty Cellulose.
“We passed a motion unanimously that we approved the agreement,” said Mayor Jan Allen, adding that “with this agreement, which we are calling the tax reduction agreement, the message is very clear that through the cooperation of the Village of Port Alice and Neucel, we are working together to end the curtailment.”
Allen stated that due to the tax reduction, the village has had to “tighten our belts. We had to layoff an employee in the office, and we now have only one employee who runs our arena. We’re being very cautious with our spending because we don’t have a choice.”
All told, Allen feels the new year is “looking positive,” and the village staff is “definitely looking forward to the new year.”
As of presstime, Neucel has not yet signed the agreement.
When asked to comment, Neucel’s Vice-President of Human Resources, Warren Beatty, stated the company is “very pleased the village is supporting restart efforts through the provision of tax relief in 2017.”
The tax reduction agreement states that ‘In recognition of Neucel’s financial circumstances and to seek to limit the risk of the mill being permanently closed, the village has agreed, without having fettered or limited its legislative discretion in any way, to reduce property taxes on the Class 4 Heavy Industrial Lands for 2017 by 25 per cent from the 2016 taxes of $899,260.00, reflecting a total reduction of $224,825.00.
“In acknowledgment of the village reducing its property tax, Neucel hereby commits to start up the mill operation by Dec. 31, 2017 provided that the village is prepared to accept compliance with ‘start up’ to have been established, if Neucel demonstrates substantial, demonstrable progress towards such start up by that date, even if actual production has not started.
“Neucel agrees that it will pay the property taxes, net of the reduction amount, on the lands in 2017 by July 31, 2017 and in addition, shall make a further payment to the village on Jan. 1, 2018 of $224,815.00 if it fails to meet the mill startup commitment.
“Neucel acknowledges and agrees that the village cannot and has not in any way contracted to exercise its legislative discretion in setting property taxes in any manner or to waive or reduce any future property taxes and that this agreement reflects Neucel’s binding contractual commitment to start up the mill by Dec. 31, 2017, as defined herein, or to make the additional payment defined herein.”