That the provincial government has the right to refuse the City of Thompson’s request for money from the Mining Communities Reserve Fund (MCRF) to help it weather the economic body blows it is sustaining as the result of Vale Manitoba Operations shutting down its smelter and refinery good a few weeks from now is not in dispute. Just because the city asks for something doesn’t mean the province is in any way obligated to provide it.
Another thing that’s hard to dispute is that the provincial government hasn’t been exactly unambiguous when it comes to their reasons for refusing the request, though even back as far as last summer responses to the city were signalling that the government didn’t think it would have enough money in the reserve to provide any funding to Thompson, claiming as it does that the only way money can be paid out of the reserve is if it has a balance of $10 million or greater.
It also seems fairly certain that that interpretation of the Mining Tax Act by the provincial government is either based on either poor reading comprehension or deliberate obtuseness, as it reads, in part that “the Lieutenant Governor in Council may (a) direct amounts to be paid from the mining community reserve for the welfare and employment of persons residing in a mining community which may be adversely affected by the total or partial suspension, or the closing down, of mining operations attributable to the depletion of ore deposits.” The part about the $10 million threshold doesn’t show up until the next clause.
Whether or not the shutdown of the smelter and refinery, which is the result of tighter environmental standards and only indirectly due to the depletion of ore deposits, would qualify the city to receive payment from the MCRF is an open question, though perhaps the suspension of mining operations at Birchtree Mine would be considered as having met that requirement. Regardless, if anyone can provide a rationale as to why a reserve would need to have $10 million in it if it could never be drawn down below the $10 million mark, have them step right up and perhaps bring along whatever they have been ingesting that has enabled this bit of ludicrous logic to seem reasonable. If that were really the case, wouldn’t it be easier just to say that money could be paid out only if the reserve was above zero dollars and find another use for the $10 million besides just collecting interest?
At any rate, if making the city wait for a year before providing a final answer was not a strong enough hint, it is now beyond certain that no such funding will be forthcoming. That doesn’t necessarily mean the decision was wrong, While the previous NDP government certainly did use the MCRF to provide money to communities going through tough times as a result of either cyclical or permanent downturns in the mining industry, it isn’t at all clear whether most of those efforts were anything more than stopgap measures without any lasting effect.
We’ve said it here in this space before and we’ll say it again. The solutions to the problems facing Thompson as the result of changes to the mining industry affecting the local economy will be left to local politicians and residents to figure out. In their somewhat confusing fashion, the province has made that clear.
