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Domtar and City of Dryden Reach Tax Agreement on Pulp Mill

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The Corporation of the City of Dryden, Ont., Canada, and Domtar Corp. (Montreal, Ont., Canada) on Monday (June 20) announced a comprehensive agreement settling all outstanding municipal taxation matters from 2009 to 2016.

"We believe this agreement addresses the city’s immediate financial constraints while recognizing the mill’s need for competitive industrial taxes over the long-term. After years of having this issue outstanding, a decision was made by this Mayor and Council to resolve this matter by working cooperatively with one of our largest employers, Domtar. Through positive, goal-orientated negotiation, we are pleased to announce the matter has been resolved," said Interim Chief Administrator Nick Beyak, repesenting the city of Dryden. "Domtar recognized the current fiscal situation at the City. Also, the mayor and council were practical, and understanding of Domtar's position, while still keeping the interests of the citizens of Dryden as their top priority. I believe this is a win-win settlement for all concerned, and the city looks forward to a long, prosperous relationship with Domtar," he added.

"We are very pleased to have reached this agreement with the City and we appreciate the recent efforts made to bring this important matter to a conclusion," said Jim Blight, GM of the Dryden Pulp Mill. "We believe this agreement addresses the City’s immediate financial constraints while recognizing the mill’s need for competitive industrial taxes over the long-term."

Under the terms of the agreement, the tax refund owed by Dryden to Domtar is reduced from $7.9 million to $6.65 million. In addition, Domtar will waive appeals underway for the 2013-2016 period. The city will cap Domtar’s industrial taxes in 2017 and 2018 at the 2016 level. It will also pass and publicize a broad, direction-setting resolution outlining the city’s long-term goal to reduce the industrial taxes per metric ton to the average among Domtar’s competitors to support the competitiveness of the Dryden mill.

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