GUEST EDITORIAL: Creative solutions for rural industry

Andrew Zwicker
By Andrew Zwicker
July 22nd, 2009

To try and keep it as simple as possible over the Celgar issue, I think all parties involved would agree that both sides have legitimate cases to be made over this issue. The city needs to maintain its largest single source of revenue while at the same time helping make sure said revenue source is a healthy, functioning, citizen-employing and profiting business.

That would indicate to me that the best possible outcome lies somewhere in between the two perspectives, maybe an agreement to meet in the middle with a 25 per cent tax break rather than the full 50 per cent asked for?

I can foresee a numbers game on that approach turning into an epic battle, such as the current bickering between Trail and Rossland over the exact numbers to help fund a pool whose services are getting cut back more and more as a decision proves elusive even after over a year, so far, of negotiating. Debating the numbers of such a deal for, potentially, years – and going another fiscal year with no taxes being paid  – would put the city in a tough economic bind, as well as severely hamper its negotiating power as time goes by. This wouldn’t be a the wisest approach.

For that reason, I might suggest a more creative solution to try to make everyone happy, wtih each benefitting, while at the same time giving something up. Let’s start in that equation by making Celgar happy and say “yes, you can have your 50-per-cent tax break”.

Great for their business, hopefully keeps them viable through the tough times and profiting again in the good times, keeping Castlegarians employed and keeping tax revenues on those profits flowing into city hall.

Next, let’s make the city happy.

Up front, we’re losing millions of dollars in tax revenues per year by giving up that tax income, so it shouldn’t be  without something in return.

I would suggest that having a major industry in any town puts a heavy burden on the environment in that area, which is a cost that rarely gets factored into the equation. The 70,000 litre spill of pollutants into the river and a number of environmental violations over the history of operation aren’t things that should be lived with or tolerated or even fined and let continue to happen.

This is where Castlegar could get their win.

Give up the 50-per-cent tax break and, in return, impose tight new environmental policies on the operation of the business with fines according to the real cost of cleanup and the real cost of destroying the greatest natural resource in Castlegar; the lakes and rivers.

In this scenario, particularly in the early years of the agreement, spills will likely occasionally still happen as environmental procedures improve at the plant, and this will make up a large portion of the revenue lost in the 50-per-cent tax break. It may also spin off a new service industry in town, providing those services to the plant and creating new jobs and, again, more tax revenue to help fill that gap.

One clear lesson to be learned through this is the need for diversification to avoid winding up at the mercy of one company that provides so much of the city’s revenues. This should be more reason to look towards creative solutions rather than maintaining a mindset that Celgar is the only option to regain any lost revenue in tax cuts.

Ideally, over time, the spills and accompanying fines will slow and or stop, and that revenue will be lost, but the amenity gained to the people of Castlegar includes: clean rivers, clean lakes , increased recreation opportunities on and in the water, potential for increased tourism revenue from the underutilized river, increased amenities and quality of life that may keep more locals around and make the city more attractive to new residents and maybe, just maybe, a slow change in mindset of the river being an industrial resource first to more of an ideal of it being valued as an environmental resource that can be enjoyed as much for its beauty as its electrical potential.

Sound similar to the relationship between Trail / Rossland and Teck?

Imagine if tomorrow Teck, who supplies an even greater percentage of Trail’s income than Celgar does to Castlegar, decided to not pay their taxes because they too are going through tough times and demand a 50-per-cent tax break. It would certainly make the current revenue issues around recreation pale in comparison.

Imagine also if a similar deal as suggested above was reached and Teck stock soared again as they came out of the tough times strong,  hired more employees and gave back more profits to the city, cleaning up the river and surrounding environment at the same time?

Without major change, it will remain a fact that a strong and profiting smelter is essential to a strong and profiting Trail and Rossland. The current cost we pay is a severely degraded environment and a literal slow poisoning of th area through a century of lead exposure. In Rossland ,we get off easy as the population immediately surrounding the smelter and folks downriver bear the brunt of the environmental hit.

A creative solution that allows business and industry to thrive while at the same time improving the environment and health of a city?

While unlikely to be the final solution, I present this option as proof that there are endless alternatives to solving the Castlegar situation, as well as avoiding a similar situation in Trail and other industrial/ rural cities around the province. It is possible to win on all sides. Here’s hoping the decision-makers can get creative.

Categories: Op/Ed