A forklift operator moves material at a distribution centre.
CORNWALL, Ontario – At least one councillor thinks the city should get tough with distribution centres in Cornwall that are appealing their assessment.
Cornwall could potentially lose out on millions of dollars in revenue that may have to be made up via the tax base because the operations are successfully appealing assessment hikes.
But Coun. Andre Rivette believes it’s time for the city to fight back.
“It’s important that we send a clear message to these distribution centres…we’ll go to court,” he said. “ It’s time to challenge them.
“I’m totally against them getting any more subsidies. The more we keep giving in to them the more we will have people coming back and appealing assessments.”
The increases plaguing distribution centres comes as a result of changes to way the Municipal Property Assessment Corporation values the properties. Before 2013 a so-called “market adjustment factor” reduced distribution centre assessments by about 40 per cent.
But starting this year that reduction is no longer in play – which means assessments for places like Eleven Points Logistsics, Target and the like in the industrial park has spiked by between 86 and 96 per cent.
The major distribution centres in Cornwall have filed assessment appeals.
The city uses assessment numbers, including forecasts, to create its budget. Over time, if assessments are lowered by way of a successful appeal, the city can end up paying money back to the industries.
In 2012 the city wrote off $720,000 after Nav Canada successfully appealed an assessment increase.
“The impact on Cornwall is huge. This is massive,” said Coun. Bernadette Clement, who added the city has hitched its economic wagon to the distribution centre industry. “We need to keep in touch with this closely.”
If the distribution centres are successful in reducing their assessment by 10 per cent a year over the next four years the city will be on the hook for paying back $2.2 million.
The city is budgeting to put aside money every year to offset this difference.