[IPSM] Band land tax goes in city's favour

[shelly]

Band land tax goes in city's favour 

By Jim Kelly - The Chronicle-Journal 

January 11, 2005 

Fort William First Nation Chief Peter Collins isn't surprised by a Superior Court of Justice decision that went against the band.

In a 14-page decision released Thursday, Justice Patrick Smith dismissed an injunction that would have prevented the City of Thunder Bay from collecting taxes from Fort William.

To date, arrears for the land in question is $3,765,509.80 and taxes will continue to accrue at a rate of $1,364,500 per year exclusive of penalty and interest.

"It means the travesties and injustices to our community continue 100 years later," Collins said Monday.

"But by no stretch of the imagination are we done with this. We're putting together a strategy to see what our next steps will be," he said.

Collins said one of the options is to appeal Smith's ruling.

The band wanted the injunction in place until a 2003 application regarding the status of riverfront lands is resolved.

If Fort William is granted reserve status for the land, it could cost the city millions of dollars in tax revenue.

City solicitor Rosalie Evans said the city will immediately proceed to collect the overdue taxes.

"We have a lot of remedies available to us," she said.

If the band reneges on payment, she said, there could be a lawsuit "down the road."

The issue dates back centuries and involves land along Lake Superior bordered by the Kam and Mission rivers.

Fort William Indian Reserve No. 52 was established in 1850 with a total area of 19,200 acres. Over the years, land was transferred to the province and in 1906 about 1,600 acres was granted to the Grand Trunk Pacific Railway Company. In 1918, GTP collapsed and its holdings were amalgamated with Canadian National Railway.

>From 1921 to 1955, CN rented portions of the land to industrial businesses and sold about 500 acres to third parties.

On July 14, 1999, CN transferred 1,100 acres of the original "Acquired Lands" to the band. The acquired lands are mostly vacant, but 300 acres are occupied by eight businesses, including Mission Terminal, Abitibi and Coastal Steel.

In 2001, the band negotiated with Bowater to build a sawmill which would be leased to the company. An agreement was put together that would see 65 acres revert to reserve status, which would exempt Bowater from paying property taxes.

However, the issue of bringing land to reserve status stalled as a result of the involvement of the "Canadian bureaucracy," band manager Michael Pelletier said in a Nov. 29 affidavit.

Lawyer Allan D. McKitrick, representing the city, argued before the court that Fort William knew at the time of the land transfers that it was a condition of the transfer that municipal taxes had to be paid.

Smith said the band paid $2 million in taxes to the city and there has been no explanation provided to the court as to why it "was financially able to pay municipal taxes then but cannot now."

McKitrick said the withholding of the taxes places an unfair burden on city ratepayers.

Smith agreed.

"A failure to collect taxes for this duration of time and of the magnitude of several millions of dollars prejudices the public interest and places an unfair burden on the remaining ratepayers of the city who are required, in the interim, to pay their taxes and maintain the municipal services some of which continue to be provided to the applicants and its tenants," Smith said in the ruling.

McKitrick said he was pleased with the decision.

"It's consistent with the submissions that we made to the court," he said.

Smith said Fort William First Nation Development Corporation, which owns the lands, did not provide information to the court revealing the "state of its financial house.

"To do anything less leaves the impression that the applicant expects to be able to collect rent, receive municipal services and, at the same time, be relieved from paying taxes," Smith said.

He said there was no evidence presented to show whether Fort William is financially unable to pay the arrears or ongoing taxes. 
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