I have another return to oral question asked by Mrs. Marie-Jewell on December 6, with respect to GNWT contribution toward the road in Fort Chipewyan.
In response to the Member for Thebacha's question yesterday, I can advise that the report in the Slave River Journal, of a $1 million GNWT contribution towards the cost of an all-weather road between Fort Smith and Fort McMurray, through Fort Chipewyan, is without foundation. No discussions have taken place about this matter with federal or Alberta officials.
Last one then, Mr. Speaker. This was a return to an oral question by Mr. Koe, on November 29, with respect to the report prepared on the Fort Resolution sawmill.
Further to the response to Mr. Koe, on November 29, the review of the Slave River Sawmill has been completed. In order to respond to Mr. Koe's written question 30-12(3), the history of the mill had to be reconstructed, thus the delay in responding. The information put together is the best available and is as accurate as possible. It should be noted that there are few records available for the time the mill was privately owned. Few of the original documents respecting GNWT funding are readily available. Available government records, historical reports and audited financial statements from 1975 to 1987 were used to reconstruct the financial history of the mill.
Historical Territorial Government Involvement
The territorial government got involved in the operation in Fort Resolution in the mid 1960s. All private mills in the area were closed, the local economy was stagnant and residents dependent on welfare. Economic stimulus was required. The cooperative movement was encouraged to become involved in the area and, in 1965, the Fort Resolution Cooperative Association was formed to establish a sawmill. During the 1965-66 fiscal year, the GNWT invested $35,000 in the mill. The mill, over the years, has provided many benefits to the people of Fort Resolution; training, jobs, a decrease in dependence on social assistance and an enlarging of the Fort Resolution economy.
Since 1965-66, the Government of the Northwest Territories has invested $4.2 million in the operation through contributions, grants and direct payments. In addition, the territorial government advanced $993,000 in loans, of which $529,000 has been converted to grants, written off or forgiven.
Existing records provide very little detail as to the purposes of grants and contributions. Financial statements indicate that some contributions were used to purchase fixed assets but do not give the purchase price or list the assets purchased. Fixed asset purchases were accounted for as deferred government assistance and the value was amortized at the same rate as corresponding fixed assets.
Other contributions and direct payments were provided for operating assistance and to cover off bank loans. Again, financial statements do not detail exactly how specific contributions were used.
The mill has also received funding from the federal government. Various departments and agencies have invested at least $3.3 million in the operation through grants and contributions. The mill received some loans from the federal government.
Production
Between 1965 and 1986, over 30 million board feet of lumber was produced at the mill.
Employment And Income
Employment records for the mill are sketchy, but reports done over the years provide some indication of employment levels. During the years 1965 to 1968, for example, 113 individuals worked in the mill. These were not full-time jobs, as the mill only averaged 17 person years of employment each year. People combined work in the mill with pursuing traditional life-styles. The numbers suggest that a large number of people received training that could be applied in the future. By 1986, the mill averaged 40 direct person years of employment.
Information on earnings is more complete than that on numbers of people employed. From 1975 to 1987, $3 million, 31 per cent of the operating expenditures for the period was paid to employees (salaries and benefits), most of whom were residents of Fort Resolution. These figures do not include employees of contractors. The number of contractors used by the mill for logging and hauling, between 1975 and 1987, is not known, but available information indicates that over 18 per cent of expenditures, $1.7 million, went towards these activities.
Plans To Reopen The Mill
In late 1992, the Northwest Territories Development Corporation was approached by the community of Fort Resolution to inquire about the possibility of reopening the sawmill. In January of 1993, the Development Corporation responded in the affirmative.
The Development Corporation negotiated a deal with the community. Nuni (Ye) Forest Product Ltd. would sell the mill and all the harvest permits to a Development Corporation subsidiary in exchange for preferred shares issued to Nuni (Ye) in the amount of the appraised value of the mill. Northern Forest Products Ltd., a Development Corporation majority-owned subsidiary, would manage the mill and the mill would only remain open when the price of lumber would allow for profitable operation. No subsidy is planned once the mill is up and running.
In February of 1993, the band council, Nuni (Ye) Forest Products Ltd...