Council turned down the companies first offer when it voted April 2 to be an unwilling host for the project. At the time Mayor Brian Milne said wind energy was too divisive and was opposed by most of the residents of Southgate. He hasn’t changed his mind. He said it’s now up to councillors if they want to revisit the non-willing host decision. "If somebody wants to bring forth a motion to reconsider, it will be dealt with. It will be up to council. It won't be me bringing that motion forward," said Milne. "At this point I'm still a non-willing host."
Samsung isn’t giving up on plans for a wind energy project in Southgate.
Company representatives appeared before council on Wednesday with a new proposal.
Samsung is offering Southgate 15% equity in the 120-megawatt project. Company spokesperson Tim Smitheman said as an equity partner, Southgate could expect a net annual dividend of $905,000. That would increase the township’s annual revenue by 19% based on 2013 property tax collected.
The partnership in the project isn’t a gift. The township’s share of the cost for the 40 to 60 turbine development would be $10 million.
Smitheman said Samsung would secure a loan to pay for Southgate’s share. The township would repay the loan at a rate of $500,000 a year out of its dividend for 20 years.
However, even after the loan payments, Southgate would net $905,981 a year – a total of $18.1 million over 20 years.
In addition to the equity partnership Samsung and Pattern Development, the principal owners of the proposed project, would give Southgate $3.6 million over 20 years in a community vibrancy fund to support community, environmental and wellness initiatives.
The dividend, vibrancy fund and annual tax revenues of $250,000 from the wind energy project would net Southgate $26.7 million over the 20-year life of the project.
Smitheman said the only other community where Samsung has 15% equity agreement is Six Nation of Grand River, which has agreed to be host to a 250-megawatt wind project.
Southgate council could decide to include all or a portion of township residents as shareholders and divide the annual dividend payments among them, or it could use the money for operations and capital spending.
The township had a population of 7,190, according to the 2011 Canada census, the latest available.
Deputy-mayor Norm Jack wanted to know why Samsung didn’t include the equity partnership in its initial offer to the township earlier this year.
Smitheman said council hadn’t indicated it was interested in a partnership agreement and negotiations hadn’t progressed very far when council voted to declare Southgate an unwilling host community.
“We had only met once or twice with council when the unwilling host resolution came down. We felt we weren’t given an opportunity to put our best foot forward . . . having had the opportunity I think we would have submitted this earlier,” Smitheman said.
Barbara Dobreen, a Southgate resident who is opposed to wind energy projects in the township, said the latest offer still has too many unanswered questions.
“They are basing that number on a certain level of production. That 15% equity goes down as production goes down.”
She’s also opposed to dividing the dividend among residents. She prefers to see the township use the money as it sees fit.
“I don’t see it as good a deal as they are purporting it to be,” Dobreen said in an interview after Wednesday’s council meeting.
Coun. Kim Peeters said the money is attractive and would be well used, but worries there are too many hidden strings attached and is not swayed by the offer.
She wanted to know to what extent Southgate takes on any debts and liabilities of the project as a partner.
Council turned down the companies first offer when it voted April 2 to be an unwilling host for the project.
At the time Mayor Brian Milne said wind energy was too divisive and was opposed by most of the residents of Southgate.
He hasn’t changed his mind.
He said it’s now up to councillors if they want to revisit the non-willing host decision.
“If somebody wants to bring forth a motion to reconsider, it will be dealt with. It will be up to council. It won’t be me bringing that motion forward,” said Milne. “At this point I’m still a non-willing host.”
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