The City of Prince Albert and both school divisions appear to owe Domtar Pulp and Paper Products Inc. roughly $5.1 million.
In the agenda minutes from the Prince Albert Catholic School Division, which are routinely mailed to the paNOW newsroom, a letter from the city’s director of financial services, Steve Brown, informed the two local school divisions the city had reached a settlement with Domtar. The settlement involved a lengthy legal battle over the mill’s property taxes from 2009 and 2010.
The company argued the assessment of its property was too high and requested a refund.
The settlement means the city, as well as Sask. Rivers School Division and the Catholic school division, have to pay Domtar back. The breakdown, according to Brown’s letter, is the city will pay back roughly $2.8 million, Sask. Rivers $1.5 million, and the Catholic school division roughly $670,000.
According to Brown’s letter all legal action between the city and Domtar will stop.
The school divisions were given notice in January they would have 90 days to make the payments.
Mayor Greg Dionne told paNOW on Friday he could not comment on the matter.
Robert Bratvold, director of education with Sask. Rivers, said the reimbursement won’t impact the school division as the Ministry of Education will be handling the payment.
“Since about 2008, school boards lost the ability to levy tax,” he said. “How it works is however much property tax is collected is combined with the ministry’s grant to get a total number. If we collect less tax, the grant goes up to reach that same number. If we collect more tax, the provincial grant goes down.”
Cal Martin, the chief financial officer with the Catholic school division, echoed what Bratvold said. He called it a tax assessment issue, which should be handled by the city. Martin said the grant will be adjusted for the 2017-18 school year.
Angela Chobanik, of the Ministry of Education, sent correspondence which was included in the Catholic board’s minutes, telling the divisions the ministry is working on it.
“If we can handle the adjustment in June, that would minimize the window of time between our payments and when your[Education Property Tax] revenues are reduced,” Chobanik wrote. “We’re working internally to figure out the exact details – and we’ll confirm as soon as we know for sure.”
School divisions are currently facing financial constraints including possible budget cuts of up to five per cent.