Napanee OKs tax breaks for potential Goodyear investment

NAPANEE, Ontario—The town council of Napanee has confirmed that Goodyear Canada Inc. is eligible for a Tax Increment Equivalent (TIE) grant that could be used toward a potential upgrade and expansion of the company's 33-year-old tire plant.

The TIE grant is tied to an industrial Community Improvement Plan (CIP) that the Town of Greater Napanee established at its Nov. 28 meeting. The CIP is designed to aid industrial development by providing partial relief from the municipal portion of the taxes levied during the start-up phase of industrial operations.

In its presentation to the Napanee town council in mid-November, Goodyear outlined plans to invest up to $550 million to expand the size of the Napanee plant by about 50 percent, to over 1.2 million square feet, as part of a project to "invest in innovative technology and capabilities to ensure the Napanee plant can manufacture tires that meet the requirements" of the expanding electric vehicle market.

A Goodyear spokesperson in Akron stressed that while Goodyear "continually makes adjustments across our footprint to increase our agility and flexibility in producing more of the right tires," at this time "we have nothing to announce."

The project, if implemented, would create about 200 new jobs at the plant, Goodyear Canada said in its presentation.

The plant spans 830,000 square feet, including warehousing and office space, and employs 800 full-time employees. The plant's nameplate capacity is listed as 20,000 passenger tires a day; the project would boost capacity by 2 million units a year, Goodyear said.

The upgrade/expansion would have an upstream effect as well, the project brief notes, by increasing purchases from Canada-based suppliers by nearly two-thirds and potentially creat up to 400 indirect jobs.

Goodyear opened the plant in 1990. Napanee is a town of 16,000 residents located in southeastern Ontario between Toronto and Montreal.

To qualify for the TIE grant, an enterprise has to show a construction valuation of $10 million or greater and create a minimum of 25 full-time permanent jobs, criteria the Goodyear project fulfills, the council stated. The grant would play out over four years, starting at 100 percent and declining by 25 percent in each succeeding year, totaling slightly more than $1 million (Canadian).

In addition, the County of Lennox and Addington could offer similar incentives for the county portion of the total taxes levied. Goodyear Canada also has applied for refunding of development charges owing for the project. That provision amounts to $649,473.

The report Goodyear submitted notes that the project will result in a "substantial" increase in full-time job opportunities for residents, a large increase in industrial taxation revenues for the municipality, and spin-off/indirect impacts for the broader community.

"The project will ensure that the Goodyear plant remains operational for decades to come and further safeguards the existing employment base at Goodyear today."

If Goodyear opts to move forward with the plan, it would be the tire maker's first major plant upgrade since announcing a $125 million investment in mid-2022 in its Topeka, Kan., truck and OTR tire plant.

Since then, however, Goodyear disclosed it's planning to divest its OTR tire business as part of its "Goodyear Forward" restructuring plan.