City hall is writing off $720,000 in lost tax revenue after Nav Canda successfully appealed its assessment.
The minutes of settlement between the city, Nav Canada and the Municipal Property Assessment Corporation (MPAC) were signed Wednesday morning.
An e-mail from city finance manager Maureen Adams details the move, which will effect the city's bottom line this year.
Nav Canada had appealed its assessment for the tax years 2010, 2011 and 2012. The assessed values for the property hovered in the $34-million range - but they were dropped by around $8 million a year for all three tax years to around $25 million.
It means some $720,000 will be written off in total this year.
"Although there were appeals filed for these three years, the corporation did not anticipate a change in assessment of this magnitude," Adams' e-mail reads. "This write off was not included in the 2012 budget for the corporation."
The good news is the city has some money available to cover the write-off. Adams explained to city council Tuesday night that some $1.6 million previously thought to be owed to the province for the Ontario Disability Support Program (ODSP) can now be kept by the city - which will help offset other deficits the city has incurred this year, including the Nav Canada settlement.
Coun. Andre Rivette, who alluded to the write-off a few weeks ago at a city council meeting, said taxpayers need to know when these big-ticket expenses are incurred by the city.
"The bottom line is the taxpayers foot the bill for this stuff," he said. "The taxpayers need to know what we are dealing with."
Coun. Denis Thibault told Seaway News in this instance the city employed the use of a conciliator in negoatiations with MPAC and Nav Canada to come to an agreement that was signed Wednesday.
If all parties had been unable to agree, the next step would have involved a tribunal.
Mayor Bob Kilger was unavailable for comment.