On February 22, 2016 city council approved $175,000 for the services of a restructuring lawyer to represent the city’s interest in the CCAA protection proceedings against Essar, from the city’s contingency reserve.
Additional funding was approved from the contingency reserve, bringing the total to $475,000, the majority of which has been expended. Well now it is going to cost the city even more if approved on Monday’s city council meeting.
An agreement in principle has been reached with the lenders regarding pre and post-filing taxes owed as well as a post CCAA conclusion path forward.
Despite the agreement being reached, it is subject to a successful conclusion of the CCAA proceedings. There also remains other matters being dealt with in the CCAA process that require continued monitoring and legal assistance to represent city interests.
For example, most recently the city charged its external counsel Aird & Berlis to orally present, at a January 25, 2018 CCAA hearing, the city’s concerns that this process is taking too long at an impact to the community – a sentiment agreed to by the presiding judge in his ruling.
Additional reserve resources are required to ensure that the city’s priority lien status is upheld, that the taxes due are collected as agreed and city’s interests are maintained in the CCAA process.
City staff is recommending that an additional $25,000 from the contingency reserve be approved.