Red Lake working to broaden tax base

Annual exploration expenditures in the Red Lake district of Northwestern Ontario hit a peak in the $45-million range during the heyday of flow-through share funding and exploration was, at that time, contributing about equally with mining itself to the local economy. The demise of flow-through funding, however, had a major impact on the Township of Red Lake, Deputy Reeve Pat Sayeau told The Northern Miner. “We really felt it here as exploration dropped to almost nothing in terms of dollars spent,” Sayeau said. “Exploration, dollar for dollar, has a bigger impact on the economy. It’s what I call first-impact spending versus second-impact spending for mining. Mining operations give out paycheques to employees and the money flows into the economy in the normal way. A lot of exploration expenditures, on the other hand, go for the direct provision of services — for such things as cars, hotels, meals and transportation.”

It appears that mining is currently holding its own as the largest employer in the township but that, in the long haul, the industry will have a declining impact on the area. The township of Red Lake has recognized this trend and has taken steps to lessen its dependency on the mining sector.

“We’ve worked very hard to broaden our base, with some success on the tourism front but with little success in the forestry sector,” Sayeau said. On the tourism front, in the past 10 years the Red Lake district publicity board was formed, with municipal funding increasing from an initial $5,000 to the current level of about $80,000. An effort has been made to establish a greater awareness in the community of the need to recognize tourism as the future for Red Lake. The township is also attempting to create a greater awareness that, if tourism is to survive as a dominant force in the area, the forest industry must be more conscious of the tourism industry’s needs.

Reeve said that, while the community wouldn’t have existed without mining development, in the future Red Lake must be more ready to handle a mine closure by ensuring diversification of economic interests. “There were once more than 20 gold mines operating at one time in the region. Now there are only two,” he said.

The 2,100 people of the Township of Red Lake enjoy a “close- knit” community where employment, recreation, shopping and homes are never more than a few minutes apart.

One of the issues of the day for Red Lake, according to Sayeau, is the disparity between the contribution made by the community to the provincial and federal coffers and the amount that’s returned to the area. “We recognize that our contribution to the provincial and federal governments is far in excess of the grants and subsidies we receive,” he said. “While our contributions are high, our local tax base doesn’t really benefit from the mining operations because the mines themselves lie outside township boundaries.”

The mining operations do, however, contribute significantly to the township in other areas. Sayeau said a major effort is made by the Dickenson and Campbell Red Lake mines to provide summer jobs for local students. The companies also are active supporters of local cultural endeavors and sports teams and the education needs of the community with their provision of significant bursaries and scholarships. This support notwithstanding, Red Lake can in no way be considered a “company town,” even when it comes to local politics. Sayeau said the companies are not actively involved in the township’s politics and exert no pressures on the political system. “They do their job and leave politics to us. They’re good corporate citizens.”