U.S. company hired for Canaport LNG assessment helps companies fight tax bills
Property tax reduction from $8.1 million to $2.6 million one of largest in province's history
The U.S. company hired by the province to conduct a property tax assessment on the Canaport LNG site — and which recommended the assessment be cut 67 per cent — claims to have a long history of helping companies, including petroleum companies, fight their property tax bills.
Nationwide Consulting Company Inc. is headquartered in Glen Rock, N.J., and was quietly hired by the province last year to assess the LNG property, even though the province has its own stable of full-time professional assessors.
"Due to the complexity of this property, Service New Brunswick hired Nationwide Consulting Company, a firm with international experience in the valuation of petroleum and liquefied natural gas facilities," says a New Brunswick government news release explaining why it went outside the civil service to evaluate the LNG site.
"According to the company, the depreciation of the Canaport LNG Terminal is due to external forces caused by a decline in commodity prices and an oversupply in the natural gas industry. This has affected both the competitiveness and market value of the Saint John facility."
Based on the recommendation of the U.S. company, the province lowered the assessed value of the LNG property from $299.5 million to $98 million. That lowered property taxes, payable to the city from Irving Oil, which owns the property Canaport LNG sits on, from $8.1 million to $2.6 million.
It's one of the largest reductions in the assessed value of a non-bankrupt commercial property ever granted in New Brunswick.
Company works to lower taxes
Last year when the new potash mine outside Sussex permanently shut down, the province lowered its property tax assessment by $73 million, or 46 per cent.
In accepting the recommendation of Nationwide Consulting to lower the LNG property assessment by 67 per cent, the province called the company an "independent third party" in the matter, although in descriptions of itself, Nationwide writes mostly about its work on behalf of businesses to persuade local authorities to lower property taxes.
How independent are they? It adds more confusion and makes you wonder.- Gerry Lowe, Saint John city councillor
"Nationwide Consulting Company, Inc. has earned its reputation for excellence in the fields of appraisal and property tax," it claims on its website.
"We are committed to providing quality service, backed by over thirty years of experience, including protecting your property from excessive taxation (and) reducing your tax liability from overvaluation and over assessment."
Company lists clients, not governments
On the particular issue of petroleum properties, Nationwide publicly lists no governments as clients, instead providing a long list of oil and chemical companies it has helped with property valuation issues.
Saint John Coun. Gerry Lowe said he wants to know more about the assessment that was done on the LNG site and why a U.S. company that regularly challenges tax assessments and often works for oil companies was picked.
"If they represent all these oil companies I don't know how the province would hire them," Lowe said.
Nationwide's petroleum specialist, Gregg Manzione, did not immediately respond to a request for an interview about the company's role in assessing the LNG property.
Stephen Ward, director of property valuation for the province, said the idea to hire an outside party to assess the LNG property was his, and Nationwide was chosen following a public request for proposals.
Although the company often represents petroleum companies trying to get property taxes lowered, it also has a record of working with governments. He said he does not think Nationwide has ever done any work for Canaport LNG or its owners.
"They work on both sides," Ward said. "To this point I am not aware, to my knowledge, that they have done any work for Repsol or Irving in the past."
"Service New Brunswick is confident the $98 million placed on the property is accurate."