The City of Alberni has its own business to attend to while the Catalyst Paper Corp. tackles its financial woes, Mayor John Douglas said.
Catalyst announced Thursday that is has deferred its $21 million interest payment to bond holders. The company has 30 days to make its interest payment before triggering a default on its debt.
The development was news to city councillors, who weren’t aware of it before it was announced, Douglas said.
The move also doesn’t foreshadow anything dire with its operation in the Valley, Douglas said.
“They’re an enormous corporation so it’s hard to gauge what goes on inside it,” he said. “But I’ve been given every confidence by their local people that they are going to stay.”
The move also doesn’t mean that the company won’t be able to make its industrial taxes next year, Douglas said.
The company recently lost a court battle with the three B.C. municipalities where its mills are located in an effort to slash its industrial tax rate. The company is appealing the North Cowichan ruling and a decision is pending.
“Catalyst is undertaking whatever financial arrangements they need to,” Douglas said. “They say they expect their operations to go on as usual and I expect that they will.”
The city and company are continuing talks about water and the sewage lagoon, and those talks are expected to continue, he said.
Meanwhile, Douglas doesn’t expect the development to influence the city’s upcoming five-year financial plan deliberation.
“We can’t let ourselves be held hostage by a bunch of what-if’s,” Douglas said.
The city is going to continue diversifying its economy so in the event that something does happen it is ready.
“The mill left in Campbell River and in Nanaimo Harmac went independent,” Douglas said. “The sky is still up there and those communities are still there.”
Officials from CEP Local 592 in Alberni apprised their members of the matter on Dec 13, the unions blog noted.
Union officials are meeting to discuss options, including entering into early negotiations for a renewal of their 2008 – 2012 labour agreement.
Read the initial story here.