Zibi gets nod for $61M in municipal fee and tax breaks to defray cleanup costs

Zibi

The developers behind the ambitious plan to turn a 37-acre industrial site on the Ottawa River into a mixed-use community is poised to receive a discount of up to $60.9-million on municipal fees and taxes to help it offset to cost of remediating the contaminated land.

On Tuesday, the city’s finance and economic development committee endorsed the brownfield grant application submitted by Zibi’s proponents. The project is now being led by THEIA, a spinoff company founded by several Windmill Developments partners, and real estate firm Dream Unlimited.

The city’s incentive program is aimed at encouraging the cleanup and redevelopment of contaminated properties. Zibi’s application focuses on 16 acres on the Chaudière and Albert islands that’s been polluted by chemicals used by former mills, on-site spillage, buried and burned waste as well as an “extensive” fire on the site in 1900, according to city staff.

The city’s brownfield programs cover a maximum of 50 per cent of the rehabilitation cost. With the Zibi cleanup cost estimated at $121.7 million, the city is looking at granting a maximum of $60.9 million – the largest amount ever requested under the program.

The amount is divided into two envelopes: A development charge credit that would be awarded when Zibi applies for its building permits and a property tax rebate awarded annually after all the property taxes – which will go up significantly as a result of the higher assessed value prompted by the redevelopment – are paid.

At the moment, the municipal taxes levied on the property add up to approximately $200,000. That’s expected to increase to $18 million once development is complete.

“The economic benefits to the city (of the redevelopment) speak for themselves,” Zibi Canada president Jeff Westeinde said in a presentation to the committee.

The application, and in particular its monetary value, has generated controversy in recent weeks with some city councillors suggesting that taxpayers are subsidizing a project that would have gone ahead even without the municipality’s financial support.

However, in a presentation Tuesday, city planning services director Lee Ann Snedden called Zibi a “poster child” for an Ottawa brownfields grant and said this project “is exactly what the program was designed for.”

The brownfields application now goes to full city council for approval. The first Zibi residents are scheduled to move in to homes on the Gatineau side this October, with commercial and residential occupants moving into buildings on the Ottawa side next spring.