City Council has voted unanimously to approve a Brownfield Community Improvement Plan (CIP) at the site of the former Davis Tannery.
The approximately 13 hectare site at 2 River St. and 50 Orchard St. sits adjacent to the Cataraqui River, and the K&P trail. Formerly an industrial site, it was occupied by Frontenac Lead Smelter from the 1800s to 1915. Between 1903 to 1973, it was the site of the Davis Tanning Company.
According to City of Kingston staff, Phase II Environmental Site Assessment reports have confirmed widespread contamination of soil, sediment and groundwater on the property as a result of its former uses.
Jay Patry Enterprises Inc. is proposing to build a 1500-unit, mixed-use development at the Davis Tannery, with medium- to high-density residential, and some ground level commercial uses. However, they will need to pay for extensive environmental remediation on the land before they can proceed. According to City planners and the developers, the cleanup costs approximate $73 million dollars.
A City’s Brownfield CIP allows developers a property tax rebate and other discounts in order to offset the costs of decontaminating an area.
“This brown zone clean up is necessary for anyone to get anything out of this land,” said Councillor Rob Hutchison during council’s review of the report. “That’s really important.”
The financing model has been applied at other well known sites, including the redevelopment of the Kingston’s waterfront Block D into upscale, downtown condominiums.
Through a Brownfield CIP at Davis Tannery, Jay Patry Enterprises is set up to receive a $45 million tax rebate from the city over 10 years.
Hutchison, who sits on the City’s Planning Committee, broke down the rebate.
“The development will be in four phases,” he said. “In each phase, we would take in $1 million in taxes, and of that we would rebate back to the developer $900 thousand. In the end $900 thousand times four phases is $3.6 million, times ten years is $36 million. Then, another $9 million of forgone development charges on top of that would be $45 million.”
Hutchison did express concern that, broken down per residential unit, the property taxes from each household work out to $267 per year. The residential property taxes are the main mechanism by which the City recuperates its forgone funds.
“If you take a single detached house — which is not directly comparable, but it gives you an idea — [the property tax bill averages] $300 per month,” he said. “We are losing some money here, and we will not get that money back.”
Hutchison added that he felt his fellow councillors could still vote in favour of the CIP, and still approve of it, but felt everyone “should be clear on what’s happening.”
Hutchison requested that staff include in their pending report on the CIP a comparison to Block D, including a timeline of repayments and the “recovery rate” on property tax from that development. Staff replied that they could definitely do so.
The motion passed unanimously.