City Throws Heat In Negotiations With Carpere
By Robert Thomas
In what could easily be described as negotiating through the media the City of Moose Jaw has responded to a news release from Carpere Canada and that firm’s on again, off again, on again plans to develop the South East Industrial Park (SEIP).
In a news release the City says they are prepared to negotiate with Carpere but the initial price for the land the parties had agreed to of $10,000 per acre is off of the table and the new price is $200,000 per acre.
The reasoning given for the City’s increasing the land’s sale price is that the land is now serviced at taxpayer’s expense and therefore is worth more than the initial, now expired, agreement agreed to for the raw or unserviced land.
“This offer was rejected by the City in June,” Mayor Fraser Tolmie, said in a statement. “It was rejected because Carpere was attempting to purchase serviced land for a non-serviced price.”
“The City will make a $2.7 million investment in the Agri-Food Industrial park as part of the SaskPower Power Plant agreement that will create a minimum of 75 acres of serviced land that was recently placed for sale at $ 200,000 per acre,” Tolmie continued. “Carpere’s offer does not reflect this fact and we owe it to our residents to get a fair price. The City is eager to promote private development, but it is not the City’s policy to fund private development. We are open to further negotiations.”
In a letter Carpere Canada sent to some of the media on Monday - MJ Independent was not sent the release - Carpere said they were now prepared to extend their June 1, 2020 offer to December 31, 2020 at the initial $10,000 per acre agreed to price.
In their story moosejawtoday.com Carpere Canada extends its June 1, 2020 offer quoted a Carpere Canada news release saying the deal was contingent on the City undertaking a series of actions including:
purchase of 244.68 acres immediately and another 388 acres within five years for just over $6.3 million ($10,000 per acre), including: a $632,680 non-refundable deposit;
the commitment from Carpere to spend approximately $50 million to service the Lands, including storm water management, sewer and water, and roads; and
payment of close to $20M to the city for development levies based on $49,600/acre, not including lands dedicated to roads, municipal reserves, residential buffers, and overhead power lines.
Additionally Carpere Canada included the stipulation the City also use $6 million from the off-site levies to construct a new reservoir and southeast sewage lift.
MJ Independent has learnt the sewage lift is an integral part of Carpere Canada’s deal to purchase the former Valleyview Centre’s lands from the Province. The completion of the deal between the Province and Carpere is now according to a source delayed until September 30th.
Carpere is quoted in their Monday release as stating they have signed a Memorandum of Understanding (MOU) with an unnamed third party to establish an ag-processing plant in the SEIP. Carpere does not name what fim they signed the MOU with.
The Carpere press release was provided to the media by Deb Thorne who manages the Grant Hall Hotel on behalf of Carpere Hotels a Carpere Canada subsiduary.
The City said they are willing to negotiate with Carpere but not for the offer they received in June.
Initially Carpere agreed to purchase 780 acres of land from the City for a price of $10,000 per acre and an offsite levy of $49,600 per acre in what Mayor Fraser Tolmie at the time described as the “largest land deal in the history of Moose Jaw.”
Carpere subsequently walked away from the deal after trying to unsuccessfully re-negotiate the off site levy fees. Off-site levies are charged in addition to the price of the land and are used to pay infrastructure costs not on the development but necessary to support it.
When the initial Carpere deal collapsed a July 19th story in MJ Independent discovered Carpere on May 5th emailed Mayor Tolmie asking to set up a tele-conference between City and Carpere officials. The tele-conference was about re-starting the SEIP deal.
The SEIP is located adjacent the wastewater treatment plant in the southeast corner of the City.
The lands which comprise it were initially annexed by the City from the RM of Moose Jaw to create an industrial park for the ill-fated Canadian Protein Innovation (CPI). CPI announced in November 2017 it was set to build a $60 - $100 million pea protein plant in the SEIP. In the end the CPI deal did not materialize. CPI’s main director, Michael Schoenert, was convicted in an embezzlement scheme from his former employer Emsland-Staerke earning over four years in a German prison.
Coincidentally as the City’s former contracted economic development consultant Ms Thorne was for a time involved in the negotiations with CPI.
SaskPower has announced they will be constructing a 350 megawatt natural gas fired electrical generation plant in the SEIP. The plant will serve as the industrial park’s anchor tenant.
The complete Carpere news release is below:
