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"This deal is a disaster," Fedeli says

A deal to save CFB North Bay based on a letter of understanding signed in 1998 would be “a disaster” for the city, says Mayor Vic Fedeli.
A deal to save CFB North Bay based on a letter of understanding signed in 1998 would be “a disaster” for the city, says Mayor Vic Fedeli.

Negotiators from the national defence department will be in North Bay next week to hammer out an agreement to keep the base open for the next 20 years.

A mess
Coun. George Maroosis, who was part of the council which approved the letter, said he’s glad the city now has the opportunity “to cross the Ts and dot the Is on this agreement.”

But the parameters in the document, set six years ago and approved via a by-law, could lead to tax hikes for local ratepayers and up to $4 million a year in extra city expenditures in a worst-case scenario, Fedeli said, unless changes are made.

“It’s a mess,” Fedeli said. “This deal is a disaster.”

Got to work
He pointed to the $1.1 million annual payment in lieu of taxes North Bay receives from the military for the base, as an example; those funds would have to be applied to the municipal cost of operations and maintenance at the base under the letter of understanding.

“We’ve got to go into negotiations with the mindset that this thing has got to be redone to make it work for the taxpayers of North Bay,” Fedeli said Wednesday.

“That’s our single goal. It’s got to work for the taxpayer.”

Never saw the details
Retired Nipissing MP Bob Wood, who witnessed the signing of the letter, and Burrows could not be reached for comment, having gone to France for the sixtieth anniversary celebrations of the D-Day invasion.

Burrows, though, had told The Nugget that his main objective had been to keep the base open, particularly since 1,200 jobs had been lost at CFB North Bay when the 414 Electronic Warfare Squadron was moved.

Maroosis said the letter had been negotiated through Burrows’s office and, while councillors were told about some aspects of it, “we never saw the details.”

Fedeli said that's not an acceptable excuse and lays the blame for the letter on the council of the day.

"I'm not going to let them get away with that one," Fedeli said.

Worst-case scenario
The 1996 federal budget proposed moving the underground SAOC from North Bay to Winnipeg.

As the move was being examined, a May 8, 1998 news release from Eggleton stated, “the city of North Bay came forward with a proposal to provide much of the site support for the personnel and the infrastructure at CFB North Bay.”

Fedeli recalls reading at the time that DND was looking for cost-savings of $4 million a year to keep the base open in North Bay.

“When you begin to look a this letter of understanding you see at a bare minimum it’s going to cost the taxpayers of North Bay a million a year or, in a worst-case scenario four million a year,” Fedeli said, “because what they have said is ‘show us how to save $4 million a year and we’ll stay.’ Well somewhere the city proved to DND that they could save them $4 million a year.”

The same standard
The letter of understanding, signed by former mayor Jack Burrows, former city administrator Tim Sheffield, and former Defence Minister Art Eggleton, calls for North Bay to assume the mobile support equipment/transportation building, the recreation centre, chapels, messes, family resource centre “and any other buildings deemed surplus” by the defence department.

North Bay would also be responsible for operating and maintaining the new $24-million NORAD Sector Air Operations Centre, which will be housed in an above-ground building now under construction.

As well the city would have to provide a number of services “including but not limited to” a recreation centre and swimming pool, a family resource centre, auto and ceramic clubs, combined Roman Catholic/Protestant chapel, food services in the new SAOC operations building, and medical/dental service “to the same standard as now provided at CFB North Bay, the standard to be determined by the Canadian Forces Medical System.”

Services such as police, fire and ambulance would also be the responsibility of North Bay as would snow removal, grass cutting, grounds and physical plant maintenance, garbage collection, water, sanitary and storm sewers, roads, sidewalks and parking lots.

The letter does not mention whether North Bay will be compensated for things like medical and dental care.

A lot of legwork
Fedeli has asked Brian Rogers, the city’s chief financial officer, to estimate how much the concessions in the letter of agreement would cost.

“The best-case scenario is if somehow we get repaid for some of these services, but we’re still going to be out the $1.1 million, the equivalent of a two percent tax increase,” Fedeli said.

“If this is the worst case scenario, we’ll be paying $80 million over 20 years, which is ridiculous. What did it cost us to save the 600 jobs at Ontario Northland? A lot of legwork and paper, but no money.”

Could be burdened
For its part DND would retain between 400 and 430 military and civilian jobs in North Bay for the life of the 20-year agreement.

And unless the deal can be substantially renegotiated, Fedeli said, city taxpayers could really take it on the chin.

“We could be burdened with the $3.2 million debt of the conservation authority, which is an astronomical amount of money to throw at our taxpayers in one year,” Fedeli said.
“That would pale by comparison to this deal, however.”

A better deal
North Bay needs to put a “real” negotiating team together to bargain with DND, Fedeli said.

Conversely, Maroosis said, “if they were going to give us $30 million for closing the base, like they gave some communities, we might have been better off to say ‘give us the land, give us the $30 million and we will do something with it, and in the long run we may very well have been better off.”

He does agree that the contents of the letter of understanding “need to be changed.”

“The other thing too is that the people who kept the base here have both retired from politics,” Maroosis said, “so we’re not going to be stepping on anybody’s toes trying to get a better deal.”

Potential for growth
Still, Maroosis said, North Bay should entertain both scenarios.

“The first scenario would be what’s it going to be like if they stay here, for how many years and what’s the potential for growth,” Maroosis said.

“The other scenario should be ‘what are you going to pay to walk away’ and what can we do with that.”

Click here to read the letter of agreement.