Tax break blues
City wrestles with Miramar request
NNSL (Oct 27/99) - In a term full of political hot potatoes, none is hotter than the request from Miramar for a tax break on Giant mine.
"It's the most convoluted, most disgusting thing you can imagine, trying to decide what's going to happen with that mine," said councillor Cheryl Best following a closed meeting last Thursday to deal with the issue.
Saying the property would be only marginally profitable, Miramar wants the city to reduce taxes at Giant mine. At an earlier meeting, Miramar proposed a two-year tax moratorium on Giant, thereafter fixing taxes to the price of gold.
Miramar has hinted it may not purchase the mine if the city does not give it a tax break. Since it submitted the winning bid for the Giant property, the price of gold has increased by approximately $40 an ounce.
Mayor Dave Lovell compared dealing with the Miramar request to pressure council faced when it was asked to renegotiate a deal with the financially troubled developer of the main downtown mall.
"It's as difficult a thing as Centre Square," said Lovell, referring to the city bail out of Centre Square Mall almost 10 years ago. "It's a tough decision."
Asked if he believed Miramar's purchase of Giant hinged on a tax break, Lovell said, "If I knew, I would know what to do. I've been trying (to find out), I've been talking to people, but I don't know."
Lovell said the Thursday meeting was closed because it was called at Miramar's request. It could as easily have been held at a location other than City Hall. In attendance were four councillors, the mayor, three GNWT officials, two DIAND officials and five Miramar representatives.
Miramar spokesperson Brian Labadie said the meeting was "just information, just information," as he left.
Meanwhile, negotiations between the company and the federal government over reclamation of the site continue, Department of Indian Affairs and Northern Development spokesperson Dave Nutter said.
It was expected that the negotiations would wrap up some time last month, but Nutter said the company has yet to firm up a mining plan for the Giant property. Nutter said the plan needs to be developed before a reclamation plan can be made. Nutter said he anticipates the negotiation will conclude within the next couple of weeks.
He conceded the negotiation between DIAND and Miramar are not entirely separate from those between the company and the city.
"If there are complications within the municipal taxation side, it may delay our discussions," Nutter said.