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Councillor votes 'no' on budget; Celgar deal signed

Though few people (just under 20) attended the special meeting of council Monday night , it offered some interesting developments.

An agreement between Celgar and the City of Castlegar was signed, Celgar manager Al Hitzroth offered a presentation describing the necessity of the deal, and one councillor voted in opposition to the agreement, the budget and the five-year financial plan.

The Memorandum of Understanding (MOU) featured five key points of accord:

  1. Celgar agreeing to withdraw its court action against the city;
  2. Celgar paying all outstanding taxes, penalties and interest;
  3. Castlegar will reduce taxes by $350,000 this year; $110,000 over the next two years and will then consider another $190,000 reduction thereafter
  4. Both parties will approach the province to jointly request the city be allowed to increase taxation on dams within city limits, then using said funds partly for general city revenue and partly to further reduce major industry taxes;
  5. The city will pass a revitalization tax exemption bylaw discounting, for major industry operations, the increased assessed value resulting from capital investment.

Both mayor Lawrence Chernoff and mill manager Al Hitzroth signed the deal ...but not all were in agreement as the 2010 budget and five-year financial plan were unveiled.

Councillor Deb McIntosh said 'no' to the MOU, the budget and the five-year plan – and all for the same reasons.

While McIntosh worked as tirelessly as staff and the rest of the council in making budget decisions, deciding on cuts, and creating the five-year financial plan, she said both were heavily predicated on the MOU – with which she simply does not agree.

“We didn't have to do it as fast and furious as we did – and I don't think any city should have to negotiate with a shotgun to its head,” she said, saying Celgar tactics should not be rewarded – and the MOU is ultimately a reward indeed, she said, as she feels Celgar made few, if any, concessions in the document.

“Celgar will take the court case off the table – big deal. (Other, similar mills) are already losing those cases. And agreeing to pay their taxes and penalties? That's not a concession, it's their legal obligation.”

Furthermore, she said that, while she's been told the MOU isn't legally binding, she remains unconvinced it won't create legal obligations and problems for future councils. At the very least, she said, it locks council into a serious mess if, next year or the year after that, something like another economic crash takes place and the city is unable to follow through on some of the long-term promises made in the MOU.

“What then? Will we be right back to another tax revolt? Where does it end?”
On the other hand, she said she does agree with most of the principle elements of the budget.

“I do think we need to look at residential taxes and reducing our dependency on major industry – and we were working on that all along,” she said.

Chernoff said, though, that the MOU was both necessary and a relief, from his point of view.

“I think the deal with Celgar brings some certainty and stability to the community,” he said. “I don't think we could go another three years without those taxes being paid ...that uncertainty makes it extremely difficult to operate a community.”

Hitzroth offered his approbation, but not without qualification.

“Yeah, I think (it's a good thing),” he said. “I think, over the term of the agreement, if everything comes to fruition, we'll be quite happy with the results.

“It's a step in the right direction.”

The meeting did not include a 'question period', as public consultation meetings will take place this Monday at 5 p.m. at the Community Forum and Tuesday at the Blueberry Community School at 7 p.m. Residents can get packages outlining the budget at city hall (250-365-7227) or online at

Further input can also be offered through the city's budget survey, available on the city website or by clicking on the advertisement on this page.

McIntosh also said councillors can generally be reached by letter, email, telephone, fax or in person, and feedback is critical to the process, if residents want an end result that works for them.

“There seems to be a great deal of apathy about this kind of stuff, and that's unfortunate, because then they blame us for that,” she said. “If no one's going to come out and voice opinions, council has to just go with what we think is right.