The trust of Irving’s argument for a special tax deal has to do with a concept of “external obsolescence”, this means the market value is lower than the assessed value for reasons that are outside of a company’s control. Irving Shipyard it was argued should have lower assessed value because it is a single use property and can not easily be used for something else other than a ship yard. Irving shipyard has few possible buyers, meaning low demand, resulting in a lower market value.  

Turner & Drake a property assessment agency was hired to examine what the difference would be between the assessed value and the market value. They studied other shipyards in Canada and found the market value was 75 per cent of assessed value.

But Turner & Drake did not mention in their report the shipyards used in their comparative analysis had little in common with the Irving Shipyard.

The sale 2002 of the Marystown and Cowhead shipyards in Newfoundland was one example cited in the report to council. The Newfoundland government first sold those yards to Friede Goldman in 1997 for $1. By 1999, the company could not fulfill the conditions of sale. The company was supposed to pay $10 million in penalties to the government but that money was never collected. With it’s poor economic record it was sold again to Peter Kiewit & Sons in 2002.  

Marystown is over 300km away from St. John’s, so the property comparison is a stretch when you compare to the downtown Halifax location of Irving Shipbuilding.

Sales of the Davie Shipyard in 2008 and 2011 were another citied as a comparison by Turner & Drake.

The economic story of the Davie Shipyard is just one bad news story after another. Prior to the comparative sales used by Turner & Drake, Davie shipyard had gone threw numerous investors, partners, was in need of economic resuscitation and eventually sold 2011.

All of the comparative sales used in the Turner Drake report were of shipyards in economic dire straits.

Now compare Davie and Marystown shipyards with the Irving Shipyard. Irving has a brand new facility with a minimum of $25 billion in orders from the federal government sitting on a prime piece of real estate in downtown Halifax.

How are do these do these economically sick shipyards even come close to comparing to the Irving Shipyard? They do not, they are night and day.