Kingsport BMA approves PILOT tax payment agreement with Domtar

Leaders in Kingsport have approved a plan to authorize a tax break agreement with Domtar as it prepares for alterations to operations at its Kingsport mill.

The Board of Mayor and Alderman met Tuesday morning and approved a plan to have the City’s Industrial Development Board to enter into a PILOT payment agreement with Domtar. It would see the company pay taxes in tax year 2021, 2022, and 2023 which would see tax payments not exceed $1,000,000 over the three year time period.

Beginning in 2024 through 2038, Domtar would pay taxes that would not exceed $2,500,000 per year. The mill was idled in April due to the COVID-19 pandemic and around 300 workers were laid off. Last week, Domtar announced it would repurpose its Kingsport operations, shifting away from manufacturing of uncoated freesheet into the recycled linerboard market.

The repurposing project is expected to be complete by the first quarter of 2023 and employ around 160 employees.

Below is the full agreement approved by the board on Tuesday:

August-11-2020-BMA-Packet-Called-Meeting

Photo Courtesy: City of Kingsport