'Tough times' for meat processor: High taxes a heavy burden for Rainy River Abattoir.

AuthorMcKinley, Karen

The president of the Rainy River District Regional Abattoir said if the Ontario Government is serious about supporting local agriculture, it should rethink how it taxes small businesses like theirs.

William Darby said the latest round of legislation and plans to encourage farming in the Northern Ontario Agri-Food Strategy look nice on paper, but they don't contain any real financial relief for small operations.

The problem stems from a one-system-for-all taxation that charges agriculture businesses of all sizes the same rate. Not everyone can afford the same rate, he said, leaving their Emo-based abattoir, west of Fort Frances, to pay "punitive" taxes that often put them behind in paying taxes.

As well, small abattoirs not on farms are classed differently.

"They are classed as industrial, and they pay the highest property tax rate, just like a paper mill," Darby said. "Small abattoirs cannot sustain that level of taxation. Not only is it a disincentive, it smothers small business development."

He explained they are a not-for-profit without share capital, with 150 members that are farmer-producers who are primarily interested in having agriculture infrastructure in the community, with a secondary purpose of stimulating regional economic development.

The board petitioned the Municipal Property Assessment Corporation (MPAC) to reclassify the abattoir and appealed to the provincial review board but were denied both times. They were told that, according to the existing definitions, they were industrial, as they take a product and turn it into something value-added. The answer they received was MPAC and the review board were going to have to look at the appraised value of the property in the assessment.

Up to four years ago, their gross revenues were $186,000, but their property taxes were $22,000.

They also went to the municipality of Emo for some kind of relief, but so far no change.

They are sustaining themselves through volunteers and donations, and their mortgage holder had agreed to give them temporary relief from their payments. Without that, he said they would've been forced to close.

They've also been through the lobby groups and the Ministry of Agriculture and Food.

"If these groups and ministries are serious about encouraging the growth and production of local food, then they should remove the systemic barriers that are impeding it," Darby said. "Local producers will never achieve the economy of scale of producers like Cargill. They do...

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