A tax break designed to help an embattled North Island pulp mill will not be repeated in 2018.
The Village of Port Alice has refused to give Neucel Specialty Cellulose the same 25 per cent reduction in industrial taxation it granted the firm in 2017.
“They came forward and they asked us for another reduction for this year, and we politely said no for a multitude of reasons,” said Mayor Jan Allen.
The village cut Neucel’s 2016 taxes of $899,260 by $224,825 last year under terms of an agreement where Neucel committed to start up mill operations by Dec. 31, 2017, or at least demonstrate “substantial, demonstrable progress towards such startup by that date, even if actual production has not started.”
In December of last year, council requested a letter from Neucel proving there has been demonstrable progress towards start-up.
Allen confirmed they met with and received a letter from Neucel, but council was not satisfied with the company’s response.
“There was an agreement that we made that they would be up and running or working towards it — and showed us proof — and we felt it wasn’t exactly what we had envisioned,” said Allen.
She also addressed why the issue was dealt with behind closed doors and not made public until now.
“They asked us not to make it public yet, as it had names, ideas, and plans that they weren’t comfortable with us advertising and that is why we made the decision that we did,” said Allen, adding, “Hopefully sometime in the near future we can share that letter with you, but we can’t right now.”
Neucel recalled 25 workers (18 of which showed up for duty) on Dec. 10 of last year “to perform maintenance to preserve the mills assets” and “to prepare for a site visit from potential investors” according to a letter sent to employees by Neucel’s Vice-President of Human resources, Warren Beatty.
Neucel — by far the largest employer in the dwindling North Island community — has been in a production curtailment since March of 2015.
The pulp mill was originally supposed to be shut down for only six months, but the conditions that existed in March (most notably the declining market price for Neucel’s product), continued to exist after the initial sixth-month curtailment and remain to this day.