POLITICS

Ice rinks and yoga up in air if Cape Breton mill wins tax concession: lawyer

09/13/2012 12:55 EDT | Updated 11/13/2012 05:12 EST
HALIFAX - Programs for children and the elderly would be gutted if Nova Scotia's Supreme Court approves a request to slash municipal taxes for the NewPage Port Hawkesbury paper mill, a lawyer for the local county argued Thursday.

Bruce Clarke, representing the Richmond County Municipal Council, asked the court in Halifax to consider how residents of all ages would suffer if it nixes an existing tax deal for the idled mill. Pacific West Commercial Corp., the mill's prospective owner, wants the court to nullify the agreement between Richmond County and the plant's former owner, Stora Enso.

Ice rinks would close, yoga classes for seniors would face cancellation and the town wouldn't have money to fund recruitment programs for doctors to local clinics, Clarke said.

"These are not irrelevant things," he said. "Doing without them may not have an easy dollar calculation, but they are a severe financial hardship in their own way."

The council says that would come on top of a possible 26.5 per cent residential tax hike and deferred maintenance of buildings and equipment, according to documents it has filed with the court.

Pacific West Commercial says it should pay about one-sixth of its estimated tax bill of $2.5 million.

Gavin MacDonald, a lawyer for the company, told the court the tax deal wouldn't stop plans to reopen the mill, but it may harm the operation's future financial health.

MacDonald also questioned the validity of Clarke's argument.

"The evidence put forward by the municipality is very touching," he said. "I have to submit this is the first case where I have a client being accused of childhood obesity and increased substance abuse."

He said Richmond County should share in the sacrifices that many others have already made in the hopes of restarting the mill, which was shut down a year ago.

"We could bring before this court every person involved in this ... retirees, unsecured creditors, and they would each tell the same story," he said.

"Is Richmond being singled out for some special damage? Is it being targeted in some way? We submit there is no evidence of that."

The judge said he would make a decision by Monday.

When the mill in Point Tupper, N.S., closed last September, about 600 people were thrown out of work. The livelihoods of another 400 forestry contractors were also affected.

Pacific West Commercial has offered $33 million for the mill and said it would restart one of two machines at the plant.

If it reopens, the company has said it would call back about 300 employees by late September or early October.

It has negotiated labour concessions with unions, received a financial package worth $124.5 million from the province and the Utility and Review Board has approved a discounted power rate.

The Canada Revenue Agency still has to approve the power rate arrangement.