Unpaid taxes a “management decision,” says Shape Foods part owner

On the City of Brandon’s tax arrears list, last updated Feb. 21, there were more than 100 properties listed as being behind on their property taxes — including $266,000 owed by Shape Foods.

Jim Downey, a former Manitoba cabinet minister, who along with three other investors bought the flax-crushing and -bottling plant for $5.1 million in 2009 after its first incarnation went into voluntary receivership, said the unpaid tax bill represented “a straightforward management decision” and that there was still “considerable time” to pay up.

“It’s nothing more than a management decision. The taxes are too high anyway,”said Downey.

He added that the flax presses are now “running 24/7” and a shipment of raw materials was recently received at the plant.

Downey said he is not involved in day-to-day operations anymore, and could not say how many staff were currently employed. Management did not respond to repeated requests for comment.

The 6,300-square-metre plant was built at a cost of $30 million in 2006 and began bottling straight flax oil and blends with sunflower and olive for sale as a health food supplement in 2007.

At its peak, it employed 60 workers and contracted its flax from a producer group in the southwest of the province.

Shape Foods, founded in 2004 by a group from Burnaby, B.C., originally set its sights on marketing a flax oil product to high-end consumers in the United States.

The oil’s omega-3 content was touted as a food supplement that could help alleviate cardiovascular inflammation, and the company said it had developed a new, proprietary bottling process for giving the oil a shelf life of up to two years.

The plant was built with $9 million in loans, of which $4.5 million was extended by the local Vanguard Credit Union and $4.1 million from the provincial government under the Manitoba Industrial Opportunities Program.

An official with Manitoba Trade and Investment said he has helped promote Shape Food’s products both locally and abroad in the past few months, and expressed surprise to hear that the company was behind on its taxes.

“As far as I know it’s business as usual,” he said.

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