Demolition of Domtar's mill is a big tax hit to Prince Albert

The Domtar mill in Prince Albert used to mean $1.8 million in tax revenue for the city, but now that the mill is about to be demolished, the city is bracing itself for a big decrease in revenue.

The tax base is partially determined by the presence of buildings on the site. Domtar has announced that they will proceed with demolishing the buildings after they remove machinery and equipment.

The mill was permanently closed in 2006, putting 700 people out of work.

The Mayor of Prince Albert, Jim Scarrow, is hopeful that a new buyer will take over the Domtar site before the company demolishes the mill and hauls away the pieces.

On May 29, the provincial government signed a letter of intent between its energy and resources department, Ottawa-based biofuels maker Iogen Corporation and Domtar that could ultimately see the plant redeveloped as an ethanol production facility.

If the Iogen project — a partnership with Royal Dutch Shell — were to proceed, it would also include a power plant producing green electricity from forest and ethanol plant residues. About 100 jobs would be created, Iogen said.

Under the agreement, the government says, it will "assume ownership" of mill property that's not part of the new proposal. It will also be responsible for paying for an environmental cleanup. Domtar will then pay the government a portion of the costs.

In a project overview, Iogen says it's still evaluating the project and is consulting with the public and conducting an environmental impact assessment, among other things.

A local media report on Dec. 22 said talks between Domtar and Iogen have stalled, but neither company has issued a public statement to this effect.

Source:

Prince Albert eyes tax hit on Domtar mill (CBC)