United Counties of Prescott and Russell (UCPR) council wants to spend more time studying how the regional level of government financially supports municipal infrastructure projects before contributing $10 million to bring water and/or sewer services to the Russell Township Industrial Park.
The decision was made at the April 26 UCPR council meeting after a discussion on municipal tax equity preceding a notice of motion from Russell Township Mayor Pierre Leroux requesting the UCPR’s contribution of $10 million over 20 years to help the township cover the estimated $41 million cost of servicing the industrial park.
“I want to caution you, growth will not pay for this,” said Tax Equity Consultant Peter Frise. He explained growth in the industrial tax base has only yielded an additional $150,000 for the UCPR during the past seven years. Frise said about 80 per cent of any investment by the UCPR in the Russell industrial park would end up being financed primarily by residential taxpayers because most industrial buildings are basic shell structures that do not contain assessable improvements to warrant high taxation.
“They’re basically giant sheds on slabs,” Frise remarked.
Leroux referred to the Prescott-Russell Area Partnership (PRAP) between the UCPR and its municipalities which when created in 2013, was based on the UCPR to “up fronting” money to municipalities. He said the UCPR ends up retrieving a share of the tax revenue from new industry later.
“We develop lands, and finally when the taxation starts coming in, the counties take a share,” Leroux said.
As an example, Leroux said between 2020 to 2022, Russell Township sold about 100 acres for development in its industrial park, which generated about $1.5 million in total tax revenue for both the township and UCPR. Leroux then suggested the UCPR use an unexpected $1.4 million it has in reserves for projects under the PRAP framework.
“There’s so many ways we can work to help ourselves,” he said.
Leroux referred to the potential benefit of plans by manufactured housing company Nubuild, which hopes to build a $300 million plant in the Russell industrial park.
Clarence-Rockland Mayor Mario Zanth said he is concerned about the perception of how taxpayers’ money is being spent if the UCPR provided the $10 million to Russell Township.
“Can the counties afford it? Are the United Counties of Prescott and Russell the bank of the municipalities?” he asked.
Zanth asked why Russell Township has not exhausted its debt capacity and development charges for the project.
“Why hasn’t that been done? You openly brag Russell township has the lowest taxes. Now, you’re asking us to raise taxes,” Zanth said.
Leroux said Russell Township has spent about $25 million to date towards the industrial park.
“There is a benefit to the counties as a whole to have this park succeed,” he added.
Zanth- “This doesn’t say anything about an investment from Russell.” Said it isn’t in notice of motion.
Casselman Mayor Geneviève Lajoie noted about 600 immigrants will be brought in to work at Nubuild. She questioned if there is infrastructure capacity for added residents there or in the broader UCPR.
“I feel there are bigger issues surrounding this issue we need to look at,” she said.
Leroux clarified the Nubuild plant would occupy 40 acres, but the entire industrial park is 1,000 acres.
The Nation Mayor Francis Brière said he likes Leroux’s innovative thinking but “It feels rushed.”
Brière said he does not like the idea of the UCPR as a bank and wants a better understanding of the impact on taxpayers.
“I need to know the impact,” remarked Hawkesbury Mayor Robert Lefebvre.
He said that Hawkesbury previously had to finance expansions to its commercial and industrial areas up front.
Chief Administrative Officer Stéphane Parisien acknowledged he had been struggling with the idea of the UCPR getting involved in financing an industrial park.
Zanth suggested the PRAP policy be rewritten to serve each municipality’s need based on further examination of what each municipality’s priorities are.
Leroux agreed to withdraw his notice of motion requesting the $10 million if changes are being made to the PRAP policy.
Warden Normand Riopel said he wants to move ahead with a plan.
“If we don’t have growth, we’re going to tax our residents,” he said.
Staff will return to council with a recommendation on how to proceed with changes to the PRAP policy.
