CORNWALL, Ontario – The City of Cornwall remembered the sale of Cornwall Electric on the 21st anniversary of the transaction.
In 1998, Cornwall Electric was sold by the City of Cornwall to Consumer Gas. The history of the utility goes back more than 100 years, and the City of Cornwall decided to originally buy it back in 1977 for $4.8 million. Ten years later, Cornwall Electric acquired St. Lawrence Power for $13.8 million.
“We typically termed Cornwall Electric as the crown jewel of Cornwall’s assets,” Ron Bergeron explained to Council during a presentation. He went on to say that the decision to sell this “crown jewel” came because the timing was right.
“We hit the sweet spot in terms of value and timing,” he said.
The transaction was delayed however due to the great Ice Storm of 1998. The sale was supposed to go through on Feb. 1, 1998, but the Ice Storm damaged some of the infrastructure, delaying the closure of the sale.
The City got busy replacing much of the damaged power lines, transformers and towers.
“All infrastructure was replaced by the time the deal went through. In some ways, it was a new company,” said Bergeron.
Dick Aubry, who was Alderman when Cornwall Electric was bought by the City, and Mayor when it was sold, said that the sale of Cornwall Electric had a great impact on Cornwall.
“It is one of the best things that ever happened to this city and had one of the biggest impacts on the city,” he said.
The utility was sold for $68 million in 1998. That money was used to clear municipal debts and to create the Progress Fund. Since its creation, the Progress Fund has generated $20.5 million in interest, and has been used to support projects throughout the city.
Cornwall CAO Maureen Adams listed some of the projects that were supported by the Progress Fund including the new Cornwall Community Hospital, the River Institute, the Agape Centre, the Aquatic Centre, the Boys and Girls Club, Hospice Cornwall and more.
“I’m not sure there would still be a Hospice without the City’s contribution,” Adams said.
The sale helped ensure as well that the ratepayers in Cornwall received lower power rates than Hydro One customers.
