Council Approves Blockbuster Land Deal

SOURCE City of Moose Jaw

“It is the largest land deal in the history of the City of Moose Jaw,” an enthuiastic Mayor Fraser Tolmie told Council during debate into the Offer To Purchase approximately 780 acres of land in the Southeast Industrial Park.

The land deal will see the British Columbia based Carpere Canada purchase the land for a cost of $10,000 per acre plus the establishment of a Development Levy of $49,600 per acre with the price held at this level for ten years. The sale would allow Carpere Canada to develop a Southeast Industrial Park.

Further under the agreement Carpere Canada would be responsible for the servicing costs of the property thus allowing the City not to have to spend funds for the property’s on-site infrastructure costs.

“The opportunity to sell Industrial Park lands to Carpere will reduce the City of Moose Jaw’s risk in servicing costs that might be otherwise incurred,” Administration’s report to Council read.

A similar agreement has been signed with SaskPower where the Crown corporation signed a Option To Purchase 108.92 acres in order to construct a new natural gas fired generating plant. In that deal SaskPower has agreed to pay for the necessary on-site infrastructure required.

“Carpere Canada’s vision is to seek opportunities through its vast network of investors in Canada and Asia to develop agriculture processing related initiatives including a research component. Its industrial park model includes partnerships with producers, various levels of government and various processing opportunities developed through private investment,” Administration’s report read, adding later “Carpere proposes to begin planning and development in 2019-20, which will positively impact the local economy immediately. This development gives the City an opportunity to partner with a company that can bring industry to our City.”

Despite the debate, which saw the majority of Council members state they were in favour of the deal as laid out, there were some concerns raised by Councillor Brian Swanson.

Councillor Swanson questioned a key portion of the agreement where the land and the infrastructure improvements could be re-sold to a yet unnamed third party.

“The first time it came to us I had concerns…the concerns I had were not addressed to my satisfaction,” Councillor Swanson said.

To satisfy his concerns Councillor Swanson sought to have an 11 word ammendment replace a 149 word clause in the agreement.

“When there is 149 words it causes me concern,” he said.

Councillor Swanson had already stated he was proposing the ammendment in an effort to put a standard clause seen in most other industry agreements.

“We already voted on this,” Mayor Tolmie stated, adding “I won’t be sidetracked on any last minute ammendments.”

After discussion at a June 29, 2018 in-camera or closed door meeting of Executive Committee the committee voted in favour of the agreement. The Cities Act allows land acquisitions to be discussed in-camera.

Councillor Heather Eby said that portion of the agreement has a clause “upon the consent and approval of the City” in it so it would have the same effect.

“Upon consent and approval of the City, which will not be unreasonably withheld, conditioned or delayed the Purchaser shal! have the ability to assign this Offer to Purchase, the Land Purchase and Development Agreement, and the Servicing Agreement/ and any nominee, partnership, limited partnership, or other related entity of the Purchaser. Upon the assignee becoming bound by and obligated to observe and perform the covenants and obligations of the Purchaser thereunder, the Purchaser (including, without limitation, its directors, officers, agents/ employees, members/ and shareholders) shall, without further agreement, be released on an absolute and irrevocable basis from any and all liability of any kind whatsoever upon such covenants and obligations. For greater clarity, this restriction only applies to the Offer, Purchase/ Development and Servicing Agreements and not to anytransfers of land following the closing date,” the original clause reads.

Councillor Swanson wanted to ammend the clause to read in part “not to be assigned without agreement by both parties.”

“I believe the City would have to approve before this happens and I think it is already in there,” Councillor Eby stated.

On the proposed ammendment the vote was 5 -2 with Mayor Toimie, Councillors Chris Warren, Scott McMann, Crystal Froese and Dawn Luhning in favour. Councillors Swanson and Eby were opposed.

“All of these initiatives and strategies is creating added value for agricultural products,” Councillor Froese stated.

A main initiative for the Provincial and Federal governments has been for decades value added or processing of agricultural products close to their production location thereby creating additional jobs and wealth in local agricultural communities.

“It will not happen overnight but Carpere are experts in this,” she said.

Councillor Luhining also agreed with the sale.

“I am 100 percent in favour of the motion…its an exciting opportunity for us and I will vote in favour,” she said.

“All the work the last number of years has had SaskPower come forward and now Carpere Canada has come forward and they want to make an investment in the community,” Councillor Chris Warren stated adding “the sky is the limit in terms of what we can achieve and the potential.”

In a 6 - 1 vote with Councillor Swanson opposed the Offer to Purchase was approved.

According to their website Carpere Canada is an agricultural based corporation that sources grains and honey from farms in the Tisdale, Nipawin, Winnipeg and Minneapolis regions and ships the products to China. The company is headquartered in Vancouver.

As an aside one of Carpare Canada’s listed directors Morris Chen was recently mentioned in a Globe and Mail Report on Business article. One of Chen’s former business associates is listed as a major powerhouse in the Chinese Communist Party. Another is a major fundraiser for the federal Liberal Party of Canada. Read the article by clicking here.

Chen is also involved with the North American Trade and Promotion Association a non-profit which attempts to set up partnerships between governments and businesses in both Canada and China in order to increase business corporation and better use of resources. The group has assisted setting up Canada Potash Corportion which is exploring and in the end developing potash mines to ship product to the Chinese and other Asian markets.