Sudbury to ask province for mining revenue share: new report encourages city to earn back revenues from province.

Armed with a new report detailing the drop in property taxes it has received from mining companies, the City of Greater Sudbury is looking to take a new step on its quest for funding to bolster its infrastructure.

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The Advisory Panel on Municipal Mining Revenues, appointed by mayor John Rodriguez shortly after his election in 2006, has detailed the widening gap the city has seen in tax revenues from mining firms. For example, it's estimated that between 2001 and 2005, provincial property tax revenues from mining firms grew by 110 per cent; conversely, municipal property tax revenues declined by 4.5 per cent.

In fact, the report says the city has lost $20 million in mining-related tax revenues over the last five years, due to declining property assessments.

The central recommendation to emerge from the panel was for Sudbury to approach the province and enter into talks for earn a share of the resource revenues.

As the chair of the panel, Jose Blanco says that there are already systems in place which the province could use as a basis for distributing tax revenues to cities.

One such system is the Aggregate Resources Act, which finds the province distributing a portion of tax revenues from aggregate collection firms back to the communities from where the material is collected.

The similarity between aggregate and mineral ores in this context is not lost on Blanco, who argues that such a model would work for both the province and the municipality

"It's their own system, so it's not as though we're suggesting something completely new here," says Blanco, a former vice-president of Vale Inco before his retirement.

"We want to generate this revenue, but we don't want the miners to stop mining and we don't want the province to see us as unreasonable."

If successful, any funding earned in this way will likely go to help fund infrastructure renewal projects, especially the city's crumbling roadways, which Rodriguez has referred to in the past as a "conveyor belt" for the mining companies.

However, he also hints that this might not be relegated just to transportation, but may also be used for various cultural projects including the proposed arts centre and multi-pad ice rink.

The panel's findings arrive at a time where Queen's Park is pursuing its own revenue-sharing requests from the federal government, potentially complicating the success of the project.

However, Rodriguez says it's all about framing the approach with potential incentives for the province as a whole. Providing communities with a share of the tax revenues will allow them to reinvest their share of the taxes into local infrastructure, thereby improving their attractiveness and suitability to business investment.

As more companies are drawn to set up shop, the province will receive additional taxes, continuing the cycle.

"I tried banging my fist for 19 years in Queen's Park and all I got for my trouble was sore fists," he says. "I figure if we try using honey, we'll actually get some bees."

Ultimately, the panel's findings are not being branded as a Sudbury-only solution, but rather as a potential template for action across the North as a whole. Officials are looking to promote and distribute the findings throughout the region, though Blanco says Sudbury's infrastructure has been harder hit over the years than most Northern Ontario mining towns.

City council has already approved the creation of a new committee to begin overseeing implementation of the document, which will involve two local councillors and several other yet-to-be-determined local representatives.

The next step, Rodriguez says, is to begin pounding on the doors of various levels of government and working with Northern Ontario regional organizations to ensure that all interests are represented.

"Dalton McGuinty keeps telling the feds that he wants a partner. Well, I've chosen a partner, and it's him."

Blanco is quick to point out that there is no blame to be assigned for the current situation. Rather, he says the reality is simply a result of several decades of change, and that revenue-sharing just needs to be updated to "bring it to terms with modern life."

"There is no guilty party here," he says.

www.greatersudbury.ca

By NICK STEWART

Northern Ontario Business