Nfld. & Labrador

A tiff over taxes and water has left a Newfoundland seafood plant high and dry

The upcoming processing season at a Newfoundland seafood plant is under threat after a cash-strapped town council turns off the water to Quin-Sea Fisheries.

Quin-Sea Fisheries refusing to pay following 50% tax hike; town responds by shutting off its water

During the fishing season, the Quin-Sea Fisheries seafood plant in Old Perlican can employ several hundred people, processing species such as crab, shrimp and groundfish. (Eddy Kennedy/CBC)

A tense tax dispute between a high-profile fish processor and a small Newfoundland and Labrador town has left one of the province's busiest fish plants without any fresh water.

And if the dispute drags on much longer, it could threaten hundreds of jobs at the Quin-Sea Fisheries processing plant in Old Perlican, a small but busy fishing outport of just more than 600 residents on the Avalon Peninsula.

"Nobody wants to do this, but what do you do?" said Mayor Harvey Button this week.

Harvey Button is the mayor of Old Perlican, a small town on Newfoundland's Avalon Peninsula that is locked in a tax battle with the community's largest employer, a large seafood processing plant. (Terry Roberts/CBC)

It all boils down to water and money. The town needs cash to repair the aging lines that bring water to thirsty consumers like Quin-Sea.

So the seven-member town council raised the rates by 50 per cent for metered customers last year, charging $3 per 1,000 gallons.

The rate is competitive with what the processing plant in nearby Bay de Verde pays to that municipality, Button said, and is the first increase in many years.

There were no complaints, until Quin-Sea requested a meeting, after the company had already used vast quantities of water last season at the new rate.

"It didn't go good," Button said of that sit-down.

The valve that controls water flow to the Quin-Sea Fisheries processing plant in Old Perlican is located behind this locked gate, outside the plant. (Eddy Kennedy/CBC)

The town said it could possibly negotiate some changes for future years but it would not give the company a break on its 2019 rates.

Button said company officials walked out of the meeting, and the tension has been building ever since.

Late last year, the town issued a final payment notice to the company, and when that didn't work, council took action last month by cutting off water to the plant.

"We can't afford to leave that outstanding and it wouldn't be fair to anybody else," said Button.

It's a tense situation, with the usual small-town dynamics, and the mayor is very nervous about even commenting.

On one side, there's a group of small-town leaders, volunteering their time. 

On the other, a powerful fishing company with international reach, owned by Royal Greenland of Denmark.

Caught in the middle are plant workers who hope to return to work this spring when the fishery resumes for another season. 

Other companies have paid

The company refuses to pay anything above the old price, which means it's now in arrears by tens of thousands of dollars.

The mayor won't reveal the exact amount, but CBC has learned the back taxes are in the low six figures. That's critical revenue for a community with very little tax base.

Button said other industrial users in the town paid the higher price, but Quin-Sea is refusing, and there is no sign of a resolution to the stalemate.

CBC has made multiple interview requests with the company, but Simon Jarding, Quin-Sea's managing director, has not been available.

Old Perlican is a busy Newfoundland fishing outport, and is home to a large fleet of boats and a large processing plant. (Eddy Kennedy/CBC)

But there's another factor adding another layer of uncertainty to this issue: St. Anthony.

Quin-Sea is trying to gain a foothold in the Northern Peninsula plant, and there are fears the company could shift its processing operations away from Old Perlican.

With the shrimp resource on the decline, boats are being forced farther north, which gives St. Anthony a competitive edge because it's closer to the fishing grounds, meaning less travel for fishing crews, and less trucking for processors.

That's partly why this issue is so delicate. If the company decides to leave, OId Perlican town councillors could get some of the blame.

Button accepts that.

"We're the guys who are going to get the blame for whatever happens here," he said.

But despite losing sleep over the dispute, the mayor is steadfast

"The only resolve we got is if they do pay the bill," he said.

Read more from CBC Newfoundland and Labrador

ABOUT THE AUTHOR

Terry Roberts is a journalist with CBC's bureau in St. John's.

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