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Managing mine shutdowns : the case for community preparedness planning 1984

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MANAGING MINE SHUTDOWNS: THE CASE FOR COMMUNITY PREPAREDNESS PLANNING by BRENDA GAYLE DAHLIE B.A., University Of Calgary, 1976 A THESIS SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS in THE FACULTY OF GRADUATE STUDIES School Of Community And Regional Planning We accept t h i s thesis as conforming to the required standard V THE UNIVERSITY OF BRITISH COLUMBIA October, 1984 © Brenda Gayle Dahlie, 1984 In presenting this thesis in p a r t i a l fulfilment of the requirements for an advanced degree at the University of B r i t i s h Columbia, I agree that the Library s h a l l make i t f r e e l y available for reference and study. I further agree that permission for extensive copying of t h i s thesis for scholarly purposes may be granted by the Head of my Department or by his or her representatives. It i s understood that copying or publication of t h i s thesis for f i n a n c i a l gain s h a l l not be allowed without my written permission. School Of Community And Regional Planning The University of B r i t i s h Columbia 2075 Wesbrook Place Vancouver, Canada V6T 1W5 Date: October, 1984 i i ABSTRACT The purpose of this thesis has been to determine ways of developing a readiness by a dependent mining community for the p o s s i b i l i t y of temporary shutdown and the i n e v i t a b i l i t y of mine closure. It begins with the premise that while the occurrence of either, in most cases, cannot be prevented, i t s process can be controlled and i t s impacts managed i f there is adequate preparation. S p e c i f i c a l l y , the thesis constructs a preparedness planning framework which approaches the need for community preparedness in two ways: 1) short-term strategies to address the immediate needs .of the community following the announcement of shutdown or closure; and 2) long-term strategies to prevent, i f f e a s i b l e , the loss of an economic mainstay. Through t h i s , a community is able to address the uncertainty inherent in the mine's life-span and ultimately i t s own. The need for a mining community to plan for the loss of i t s economic mainstay i s documented through the case studies of two northern mining communities - Elsa and Faro, in the Yukon Te r r i t o r y - which have recently experienced the i n d e f i n i t e shutdowns of th e i r a f f i l i a t e d mines. Based on interviews with involved parties (the mining company, federal and t e r r i t o r i a l governments, union and l o c a l community o f f i c i a l s , and residents), i t appeared that very l i t t l e planning for the p o s s i b i l i t y of a shutdown had been undertaken. Reasons for th i s included: 1) a lack of recognition of i t s possible occurrence as well as the extent of community impacts 2) uncertainty as to i t s occurrence and duration 3) u n c e r t a i n t y over how to prepare f o r a shutdown 4) u n c e r t a i n t y over r o l e s and r e s p o n s i b i l i t i e s f o r such preparedness. A review of the p e r t i n e n t l i t e r a t u r e suggests that such problems are not p a r t i c u l a r to E l s a and Faro, but r a t h e r , are t y p i c a l i n most s i t u a t i o n s where shutdowns and c l o s u r e s were not planned. In the case s t u d i e s , t h i s l a c k of p l a n n i n g has r e s u l t e d i n an ad hoc and c r i s i s - i n d u c e d approach to a shutdown; an approach which appeared to have exacerbated i t s s o c i a l and economic d i s l o c a t i o n with d e l a y s and c o n f u s i o n over r e s p o n s i b i l i t i e s and a s s i s t a n c e measures. In d e v e l o p i n g the conceptual framework f o r the preparedness p l a n n i n g approach, the t h e s i s draws upon the experiences i n the n a t u r a l d i s a s t e r f i e l d , due to the s i m i l a r i t i e s i n dependency and v u l n e r a b i l i t y which both a mining community and a d i s a s t e r - prone community share. From d i s a s t e r p l a n n i n g e f f o r t s , t hree l e s s o n s were found to be of fundamental importance to the development of a preparedness p l a n n i n g framework: 1) the need to prepare, i n advance, short and long-term s t r a t e g i e s to a s s i s t the community in reducing the r e s u l t i n g s o c i a l and economic d i s l o c a t i o n c r e a t e d by a shutdown; 2) the need f o r a systematic p l a n n i n g process to p r o v i d e a community with the 'means' to manage and minimize t h i s d i s l o c a t i o n ; 3) the need to i n t e g r a t e community preparedness e f f o r t s with n a t i o n a l p o l i c y p l a n n i n g i n order to develop a more comprehensive and c o - o r d i n a t e d approach to the managing the process and consequences of mine shutdown. i v For a mining community to be prepared f o r e i t h e r a mine shutdown or c l o s u r e , three sets of a l t e r n a t i v e s need to be developed: • response a l t e r n a t i v e s (that i s , who i s r e s p o n s i b l e f o r what when e i t h e r a c t u a l l y o c c u r s ) ; • c y c l i c a l shutdown p r e p a r a t i o n a l t e r n a t i v e s ( f o r example, the development of make-work p r o j e c t s to o f f s e t p e r i o d s of shutdown); and, • dependency-reduction a l t e r n a t i v e s (that i s , the development of p r e v e n t a t i v e s t r a t e g i e s , i f p o s s i b l e , f o r a v o i d i n g dependence on one economic mainstay). I t i s proposed that the a c t u a l preparedness p l a n n i n g and development of these s t r a t e g i e s be done by an i n t e r - s e c t o r a l committee comprised of r e p r e s e n t a t i v e s from each of the i n v o l v e d p a r t i e s i n a mining community. F i n a l l y , implementation of the preparedness p l a n n i n g process should be approached i n one of two ways. For new p r o j e c t s north of 60° which r e q u i r e the s p e c i a l c r e a t i o n of an a f f i l i a t e d community, requirements f o r preparedness p l a n n i n g and a l l o c a t i o n of r e s p o n s i b i l i t i e s should be determined before the issuance of a water l i c e n c e . Such requirements would be s i m i l a r to those a l r e a d y e s t a b l i s h e d f o r d e a l i n g with environmental concerns i n mining p r o j e c t s . For e x i s t i n g mining commmunities north of 60°, such l e g a l requirements cannot be a p p l i e d as the mine i s a l r e a d y o p e r a t i n g . It i s t h e r e f o r e suggested that preparedness p l a n n i n g be encouraged by the f e d e r a l and t e r r i t o r i a l governments through f i n a n c i a l i n c e n t i v e s and d i s i n c e n t i v e s . V TABLE OF CONTENTS ABSTRACT i i LIST OF TABLES v i i LIST OF FIGURES v i i i LIST OF MAPS v i i i ACKNOWLEDGEMENTS ix CHAPTER ONE - INTRODUCTION 1 1.1 - The Problem 1 1.2 - Thesis Objectives 1 1.3 - C h a r a c t e r i s t i c s of a Mining Community 2 1.4 - Planning for Mine Shutdown 7 1.5 - Thesis Rationale 14 1.6 - Research Methods and Scope 16 CHAPTER TWO -• THE CASE STUDIES: ELS A AND FARO 19 2.1 - H i s t o r i c a l Background 21 2.2 - The Mining Communities 22 2.2.1 - Elsa: A Description 22 2.2.2 - Faro: A Description 26 2.3 - Reasons for Indefinite Shutdown 28 2.4 - Community Consequences of Indefinite Shutdown 32 CHAPTER THREE - CURRENT COMMUNITY RESPONSES TO MINE SHUTDOWNS 37 3.1 - Planning and Provisions Prior to N o t i f i c a t i o n 37 3.2 - Responses following Shutdown N o t i f i c a t i o n 40 3.2.1 - Elsa 42 3.2.2 - Faro 47 3.3 - Problem Areas 52 3.3.1 - Effectiveness of Responses 53 3.3.2 - C o n f l i c t over Roles and R e s p o n s i b i l i t i e s ... 55 3.3.3 - A Lack of Preparedness 59 3.4 - Summary 61 CHAPTER FOUR - A CONCEPTUAL FRAMEWORK OF PREPAREDNESS PLANNING 63 4.1 - Natural Disaster Planning 64 4.1.1 - D e f i n i t i o n of a Natural Disaster 64 4.1.2 - Disaster Planning Concepts 65 4.2 - The Rationale for Disaster Planning 67 4.2.1 - An Increase in Disasters 67 4.2.2 - A Lack of Integrated E f f o r t s 68 4.2.3 - Problems in Developing a Response Framework 69 4.3 - Summary of Disaster Planning Discussion 72 4.4 - Implications for Planning for Mine Shutdowns 72 4.4.1 - The Need to Prepare 74 4.4.2 - Opprtunities for Managing 'Disasters' 75 4.4.3 - The Need for a Comprehensive Approach 76 v i 4.5 - A Conceptual Framework of Preparedness Planning .... 78 4.5.1 - Community Preparedness Planning Level 79 4.5.2 - Shutdown Management Planning Level 80 4.5.3 - Regional and National Policy Planning Levels 80 4.6 - Integration of E f f o r t s 81 4.7 - Summary 83 CHAPTER FIVE - PREPAREDNESS PLANNING AT THE COMMUNITY LEVEL 85 5.1 - Preparedness Planning: The Process 86 5.1.1 - Goal Establishment/Problem I d e n t i f i c a t i o n 86 5.1.2 - Situation Analysis 87 5.1.3 - Generating Alternatives 88 5.1.4 - Assessment and Selection 92 5.1.5 - Evaluation 92 5.1.6 - Feedback 92 5.2 - Preparedness Planning: The Actors 93 5.2.1 - The Governments 93 5.2.2 - The Mining Company 94 5.2.3 - The Union -96 5.2.4 - The Private Service Sector 97 5.2.5 - The Residents 98 5.2.6 - Intersectoral Committee 98 5.3 - Implementation of the Preparedness Planning Process 99 CHAPTER SIX - AN APPRAISAL OF THE PREPAREDNESS PLANNING APPROACH 103 6.1 - Limitations 103 6.2 - Value 105 REFERENCES 108 APPENDICES 114 1 - L i s t of Interviews 115 2 - Provisions in C o l l e c t i v e Agreements for Mine Shutdowns and Closures 117 3 - UKH Lay-Off N o t i f i c a t i o n 119 4 - N o t i f i c a t i o n of Third Shutdown Extension: CAMC 122 5 - Planning a Mine Closure: Selco 123 6 - Examples of Economic D i v e r s i f i c a t i o n Opportunties ... 124 v i i LIST OF TABLES Table Page 1.1 - Categories of Mine Shutdowns 6 2.1 - Characteristics of Elsa and Faro 23 2.2 - Reasons for Shutdown 29 2.3 - Average Annual Prices of Major Metals 30 2.4 - Indefinite Mine Shutdown at Elsa and Faro - The Process 33 2.5 - Social and Economic Impacts of UKH and CAMC Mine Shutdowns 34 3.1 - Summary of Federal Government's Assistance Program 41 3.2 - Chronology of Responses to CAMC Shutdown 48 4.1 - A Conceptual Framework of the Preparedness Planning Process 82 vi i i LIST OF FIGURES Figure Page 1.1 - The Ad Hoc Approach to a Problem 10 4.1 - The Planning Process 77 LIST OF MAPS Map Page 2.1 - Map of Yukon Mining Communities 20 ix ACKNOWLEDGEMENT I would l i k e to thank my two advisors, Peter Boothroyd and B i l l Rees, for their enthusiasm, ideas, and endless support for thi s thesis project. While our approaches to the subject did not always coincide substantively, our discussions were, nonetheless, stimulating and pleasurable. I am also grateful to the Donner Canadian Foundation for their research grant during 1982-83 which provided me with the opportunity for f i e l d research and for pursuing this thesis topic. To the various people I met and interviewed in the Yukon, I extend my gratitude for their assistance and kindness. Completion of the thesis would not have been possible without the support of close friends and family. In p a r t i c u l a r , I would l i k e to thank a special t r i o - Harriet, Kathy, and John for without them, my experiences at planning school would not have been as rewarding. To my parents who have always encouraged me in my e f f o r t s , I would also l i k e to say a warm thank you. F i n a l l y , to P h i l , my deep appreciation, for everything. 1 CHAPTER ONE INTRODUCTION 1 . 1 ̂  The Problem There i s a lack of systematic p l a n n i n g , by many mining- dependent communities, f o r the p o s s i b i l i t y of a mine shutdown and the i n e v i t a b i l i t y of i t s c l o s u r e . As a r e s u l t , these communities are unprepared f o r the occurrence of e i t h e r as w e l l as the accompanying s o c i a l and economic d i s l o c a t i o n that o f t e n p r e c i p i t a t e s temporary or even permanent community d e c l i n e . 1.2 ^ T h e s i s O b j e c t i v e s The purpose of t h i s t h e s i s i s to develop a preparedness planning p r o c e s s f o r a mining community to manage a mine shutdown. By preparedness p l a n n i n g i s meant the development of a readiness f o r a shutdown by those i n v o l v e d (company, union, government(s), workers, r e s i d e n t s , and p r i v a t e s e r v i c e s e c t o r ) , through the c r e a t i o n of short-term s t r a t e g i e s to d e a l with p e r i o d s of c y c l i c a l shutdown(for example, make-work p r o j e c t s ) ; longer-term s t r a t e g i e s to o f f s e t ( i f f e a s i b l e ) the l o s s of an economic base f o r the community ( f o r example, economic d i v e r s i f i c a t i o n ) , and f i n a l l y , a response framework which o u t l i n e s who i s r e s p o n s i b l e f o r what, when e i t h e r a mine shutdown or permanent c l o s u r e o c c u r s . The g o a l , t h e r e f o r e , of preparedness p l a n n i n g , i s to reduce both the v u l n e r a b i l i t y t o , and the consequences o f , the l o s s of a mining community's mainstay. 2 The f o l l o w i n g o b j e c t i v e s have been e s t a b l i s h e d f o r the t h e s i s : • to document the causes and community consequences of a mine shutdown, using as case s t u d i e s two Yukon mining communities - E l s a and Faro - which have r e c e n t l y experienced the i n d e f i n i t e shutdown of t h e i r a f f i l i a t e d mines (Chapter Two); • to i d e n t i f y the major s u b s t a n t i v e and p r o c e d u r a l problems c r e a t e d by the c u r r e n t l a c k of p l a n n i n g by i n v o l v e d a c t o r s f o r the two mine shutdowns i n the case s t u d i e s (Chapter Three); • to develop a conceptual framework f o r a preparedness p l a n n i n g approach based, in p a r t , on that used i n d i s a s t e r p l a n n i n g (Chapter F o u r ) ; • to o u t l i n e i n more d e t a i l t h i s preparedness p l a n n i n g approach as i t a p p l i e s to mining communities (Chapter F i ve) ; • to a p p r a i s e t h i s preparedness p l a n n i n g approach i n terms of i t s l i m i t a t i o n s , b e n e f i t s , and o v e r - a l l value in reducing the accompanying s o c i a l and economic d i s l o c a t i o n of shutdown (Chapter S i x ) . 1.3- C h a r a c t e r i s t i c s of a Mining Community The i s o l a t e d l o c a t i o n of most mineral d e p o s i t s i n Canada has, i n the past, n e c e s s i t a t e d the c r e a t i o n of s p e c i a l mining communities to house and s e r v i c e the labour f o r c e of a mine f o r the d u r a t i o n of i t s o p e r a t i o n s . The mining community d i f f e r s 3 from other communities in several important aspects. F i r s t , i t is t y p i c a l l y an 'instant' community unlike the majority of other communities in Canada which have 'evolved' over several decades. By 'instant' is meant that not only i s the community e x p l i c i t l y created by a mining company or through a joint e f f o r t by both company and government, but i t s development 1 generally occurs within a short time span of one to three years. Secondly, the mining community i s 'planned' in terms of i t s physical design and population. The design, quality of l i f e , and the recruitment of 'stable' residents for a mining town have, in the past three decades, been considered important components for reducing the t y p i c a l l y high population and labour turnover and therefore, have t r a d i t i o n a l l y been the focus of resource community planning. Such planning tends to be done by professional planners without any input by the community's future residents. A t h i r d important c h a r a c t e r i s t i c of a mining community i s , despite the increased sophistication of i t s physical structures, i t s dependency on a single f i n i t e economic base. While an economically viable mineral deposit creates the impetus for this type of community, i t s geographical i s o l a t i o n often precludes other s o c i a l and economic opportunties and therefore, employment 1Lucas(l97l) outlines four stages in the development of a resource community: construction, recruitment, t r a n s i t i o n , and maturity. Most planning emphasis has been on various strategies to achieve the 'maturity' stage as quickly as possible. 4 alternatives for the residents (Robinson,1963,p.5; Lucas,1971). Limited transportation linkages, high costs of transporting and producing goods coupled with a lack of l o c a l markets r e s t r i c t l o c a l entrepreneurship (Deoux,1983). Dependency i s the central fact of l i f e for such communities (Himmelfarb,1976) and affects the s o c i a l and economic well-being of i t s residents for, according to Lucas (1971,p.394), "the economic and technical factors that were instrumental in locating and developing communities of single industry are the same factors which rule out additional industry, d i v e r s i f i c a t i o n of the economic base, and expansion of the population." Stelter and A r t i b i s e (1982,p.48) suggest that the lack of economic d i v e r s i f i c a t i o n i s not necessarily unintentional: The economic base i s controlled by outside corporations or governments who determine the nature and extent of extractive or processing a c t i v i t y and thereby determine the size of the l o c a l work force and the degree of l o c a l prosperity and growth. Fluctuations between boom and bust depend on the vagaries of the international market in resources or corporate and government decisions, not on l o c a l i n i t i a t i v e as i s often the base with other types of communities...[F]urther, i s o l a t i o n from major markets, r e l a t i v e l y high wages paid by resource industries and high development costs combine to prevent the influx of secondary industry." The fourth, and perhaps most obvious, c h a r a c t e r i s t i c of a mining community i s i t s inherent impermanency, created by i t s economic dependency on a depletable ore body. When an ore body is exhausted, the mining operation i s closed permanently, although other economic factors such as loss of markets, r i s i n g operating costs per tonne of ore milled, changes in technology 5 or corporate plans, and the existence of alternative higher grade and more economically viable ore bodies located elsewhere may result in permanent closure before the ore runs out. In addition, a mining community is also vulnerable to periodic downturns in external markets reflected in i n d e f i n i t e or temporary shutdowns of i t s a f f i l i a t e d mine. Table 1.1 offers a typology of shutdowns and the c h a r a c t e r i s t i c s of each type. (The case studies in Chapters 2 and 3 w i l l provide more detailed information on i n d e f i n i t e shutdown). Many permanent mine closures threaten the very existence of mining communities, and result in the relocation of most of their inhabitants. Indefinite and temporary shutdowns create similar impacts to those of a permanent closure but there are two important differences: there i s the uncertainty as to the duration of the shutdown, and there i s the opportunity in most cases for workers to continue l i v i n g in their community, though without access to other sources of l o c a l employment. Uncertainty over the occurence and duration of mine shutdowns and eventual closure discourages long-term commitments by residents and investment by the private srevice sector. It also enhances community turnover. In many cases, the f i n a l shutdown i s "preceded by a round of increased short-time working, longer shut-down periods and increased l a y - o f f s " (Molloy & Bradbury,1983,p.43). In addition, there is great uncertainty as to whether a temporary or i n d e f i n i t e shutdown i s an isolated event or whether the mine i s "undergoing a more la s t i n g decline" (Molloy and Bradbury,1983,p.46). TABLE 1.1 - CATEGORIES OF MINE SHUTDOWNS 6 Category & D e f i n i t i o n Causes of Shutdown Causes of Uncertainty TEMPORARY - a cessation of mine operations for a known period of time. Re-start up date i s known. -usually short- term - c y c l i c a l downturn in i n t ernational mineral markets; - need to reduce over-supply of processed ore at l o c a l mine. - unexpected contin- uation of c y c l i c a l downturn could result i n extension(s) of temporary shutdown, i . e . , a temporary could become i n d e f i n i t e . INDEFINITE - a cessation of mine operations for an unknown period of time. Re-start up i s expected but date i s not known. - downturn i n i n t e r - a t i o n a l mineral markets with no s i g n i f i c a n t improve- ment in sight. - extended period of downturn i n i n t e r - national markets or continually decreas- ing prices could render mining operation economically non- viable and could r e s u l t i n permanent closure of mine after long period of uncertainty. PERMANENT - a permanent cessation of mine operations. - exhaustion, either economic or physical, of ore body. - long-term s t r u c t - u r a l problems with economic v i a b i l i t y of mine. - o r i g i n a l estimated date of closure often changes due to unforeseen fluctuations i n price or discovery of new ore bodies. 7 While the s o c i a l impacts of a mine shutdown or closure vary according to the circumstances in which i t occurs (e.g., the type of shutdown, the l e v e l of preparedness, the remoteness of the community, and the p r e v a i l i n g economic conditions), the following provides a general picture of the basic community problems which they p r e c i p i t a t e : The loss of mine employment contributes to an o v e r a l l contraction of the l o c a l economy and population. The consequent loss of municipal revenues makes i t d i f f i c u l t to maintain the ex i s t i n g l e v e l of community services. Federal and p r o v i n c i a l or t e r r i t o r i a l governments must often expend large sums of money for community and personal income support programs. The s o c i a l consequences that a declining community faces are severe. Many adaptations have to be made as residents are faced with relocating, coping with the prospect of unemployment or developing new work s k i l l s , and formulating new s o c i a l relationships. Communities also become a e s t h e t i c a l l y depressed as homes and commercial buildings become vacant... (E,M,&R,1976,p.9). 1.4 ~ Planning For Mine Shutdowns Planning i s a systematic process involving the recognition of a problem, the development of al t e r n a t i v e strategies to deal with i t , the evaluation of the effectiveness of these alternatives in achieving desired objectives, a decision as to the best alternative and f i n a l l y , the monitoring of the e f f e c t s of t h i s a l t e r n a t i v e (once implemented) in achieving objectives. Such monitoring r e f l e c t s the i t e r a t i v e nature of the planning process and i d e a l l y , leads to a better understanding of the 8 nature of the problem and consequently, the development of more appropriate and e f f e c t i v e strategies to deal with i t . A major problem associated with a mine shutdown i s the lack of systematic planning for i t s occurence. Within the resource community l i t e r a t u r e , for example, only a handful of studies- have focussed on the community consequences of a mine shutdown or closure (for example, Himmelfarb,1976; Hegadoren,1979; St. Martin,1981; Molloy and Bradbury,1983). Recognition of the community consequences of the di f f e r e n t stages of mine shutdowns was forwarded by St. Martin (1981) in her 'winding-down' versus 'closure' concept: the former r e f e r r i n g to the decline of mining operations, the l a t t e r to the complete abandonment of the mining operation and, consequently, of the mining town by the company. Existin g studies indicate that, in many situations, the actual shutdown and resulting community decline have been, as Molloy and Bradbury (1983,p.42) noted, "[d]isorganized, unexpected events, in contrast to the careful and regulated establishment of the town." Hegadoren and Day (1981, pp.265-6) further pointed out that: ... Mine terminations are inevitably accompanied by charges and counter-charges over the f a i l u r e to plan for the long-term s t a b i l i t y of mine settlements, unemployed miners, and lo c a l secondary and t e r t i a r y sector employees who service the mining f r a t e r n i t y . It appears that, by far, the most common approach to a mine shutdown - whether permanent or in d e f i n i t e - i s the ad hoc approach (Fleming, 1978; Hegadoren, 1979; Molloy and Bradbury, 9 1983; Task Force 1, ,1982). By ad hoc i s meant unsystematic and react ive. In most cases, the mining company, union, and government(s) have attempted to develop plans for dealing with shutdown once i t has been announced. Figure 1.1 presents a t h e o r e t i c a l construct of th i s reactive approach and shows the re s u l t i n g lag in developing remedial measures. Plans t y p i c a l l y range from 'bail-out' assistance to emergency make-work projects to economic d i v e r s i f i c a t i o n strategies. In some cases, l o c a l task forces were established to determine future options for the community while, in others, employment committees were formed to develop 'make-work' projects for those l a i d o f f . In addition to creating community problems, the lack of planning for mine shutdowns has had serious ramifications for those regions dependent on mines for their long-term s o c i a l and economic development. The costs of a s s i s t i n g troubled communities and their mines in a 'crisis-induced atmosphere' often results in an i n e f f i c i e n t use of f i n a n c i a l and administrative resources which detracts from meeting longer-term needs. The lack of a systematic approach to managing mine . shutdowns has been attributed to several factors: 1A Task Force composed of Federal, P r o v i n c i a l , and T e r r i t o r i a l government representatives as well as industry and union personnel was created in January, 1982 to examine the problems experienced by mining communities as a result of the downturn in the mineral markets. 10 FIGURE 1.1 - THE AD HOC APPROACH TO A PROBLEM Intensity of Problem Intensity of Problem Solving E f f o r t Intensity of Problem & Problem Solving E f f o r t Problem emerges Public Recognition of problem P o l i t i c a l Pressure grows Formulation of ^ Plan \ Adoption of P o l i c i e s Programs Designed s & l e g i s l a t i o n v Planned Programs implemented Programs begin having impact Programs withdrawn or withheld Problem emerges i SOURCE: Adapted from Gunton(1982) 11 •According to Bowles(1982), emphasis has been primarily on manpower planning for the operation stage of a mining project. This r e f l e c t s , to a large degree, the nature of the problems associated with resource extraction projects during the 1950s and 1960s, a period of unparalleled growth in the primary resources sector. The increased demand for minerals during this period resulted in the development of a number of mines and a f f i l i a t e d communities in ' f r o n t i e r ' regions. 1 As a result, the focus of planning re f l e c t e d the mining company's need to a t t r a c t , retain and service a stable workforce and their families in an e f f o r t to reduce the t y p i c a l l y high labour turnover rates experienced at northern and remote mines. •The emphasis by planners on the physical and s o c i a l components of a mining community as a means of achieving community 'maturity' has resulted in a tendency to overlook the problems created by the community's economic dependency on a single employer. Robinson (1963,pp.3-4) pointed out that: [Planning] for these towns must be termed a f a i l u r e . With a few exceptions, the plans do not r e f l e c t the special s o c i a l , geographical, economic, or governmental circumstances under which they are b u i l t . The plans have d i f f e r e d l i t t l e from those being car r i e d out in the more developed urban centres in southern Canada. In short, there have been no o r i g i n a l or specially-adapted solutions equal to the individual problems of s i t e and si t u a t i o n that these towns face. While these permanent new communities are in many cases models of what a community should look l i k e 1Between 1945 and 1976, 46 new mining communities were b u i l t across Canada (Robinson, 1962, p.3). Currently, there are approximately 142 dependent mining communities (Task Force, 1982). 1 2 (indeed, they are often referred to as 'planned, model communities'), the one compelling fact of l i f e that the planners and builders did not, or could not, plan for was their dependence on a single i n d u s t r i a l enterprise, and one highly vulnerable to fluctuations in the supply and demand for i t s resources. The tendency to overlook the d i s t i n c t i o n s between an 'instant' and an 'evolved' community as well as the requirements for a 'mature' community is evident in the dearth of planning l i t e r a t u r e on the economic bases of resource communities as noted by Marchak (1983) and Bradbury (1980). There appears to have been l i t t l e evidence of recognition by planners of the fact that southern communities have evolved physically, s o c i a l l y , and economically over time to produce a 'mature' community, whereas the single purpose of a mining community would seem to preclude such maturity in the long run. Lovosky (1970,p.145) describes the expectations for the instant mining community: Instant towns have often been referred to as being 'born already grown up'. Such towns are expected to provide, almost instantly, the physical, s o c i a l and even economic environment necessary for the growth of a healthy and balanced community. But growth and maturity are slow and deliberate processes and instant towns rather than being 'born grown up' seem to be 'born prematurely', unformed and unstructured, often struggling for their very existence. Indeed, most 'instant' northern mining communities are l e f t to 'evolve' on their own once their 'maturity' stage ( i e . , f u l f i l l m e n t of the mine's manpower requirements) has been reached. The problem l i e s in the lack of a stable economic foundation which constrains the development of community s t a b i l i t y . As a result, most mining communities, unassisted by planners or plans to cope with a mine shutdown or closure, tend 1 3 to become 'instant' ghost towns. •Social and economic problems related to the shutdown of a mining operation have tended to be viewed, p a r t i c u l a r l y in times of economic growth, as isolated and temporary events (Fleming,1978). In addition, these costs were perceived as part of the so c i a l costs of economic growth (Kapp,l971). Any s o c i a l and economic dis l o c a t i o n was considered a temporary and l o c a l problem which could be, and often was, absorbed by the rapid growth in other sectors and regions, and which could be mitigated by remedial measures (McKersie,1983;• Labour Canada,1979). The dearth of l e g i s l a t i o n and p o l i c i e s regarding planning requirements for resource community decline r e f l e c t s these perspectives that the mining town's biggest problem is turnover, that isolated instances of mine closures and shutdowns can ea s i l y be absorbed by the larger economy, and that community planning means physical planning. Since the late 1970s however, the emphasis on environmental, s o c i a l and economic impact assessment, impact management, and monitoring of resource development projects has helped to d i r e c t attention to hitherto ignored e x t e r n a l i t i e s of mine shutdowns - even though most of the external costs of shutdown remain unexamined.. In recent years, there has also been an increasing recognition of the need to manage the shutdown and community decline processes in order to reduce unnecessary trauma and 1 4 i n e f f i c i e n c y (Hegadoren,1979; Task Force,1982). There is increasing emphasis being placed on the need for shared r e s p o n s i b i l i t i e s amongst involved actors for developing a more orderly and equitable process of decline (Molloy & Bradbury,1983). Recognition of the impacts of mine shutdown, the need for j o i n t management of the shutdowns, and the need for plans to guide shutdown management has stemmed for the most part, from the consequences of the worst mineral recession since the Depression (Task Force,1982). The 1981-82 recession adversely affected an estimated 80 out of 142 mining communities (DIAND,1982). Accompanying th i s has been a greater awareness of the increasing uncertainty over the life-span of a mining operation, given the current uncertainty in the international mineral markets, in addition to the physical finitude of ore bodies. 1.5 2 Thesis Rationale This thesis addresses several areas which have received minimal attention in the resource community planning l i t e r a t u r e . Of most importance is the lack of a planning framework for mine shutdown and possible community decline. This i s in marked contrast to the l e v e l of planning undertaken for the community's creation. While previous studies focus on the need to plan, and outline the major requirements of a 'pro-active' stance, no study has proposed a planning process which outlines how this 15 might be done. Mechanisms such as a mining fund, advanced n o t i f i c a t i o n by the company of a shutdown, f i n a n c i a l support and compensation, job-protection programs, economic d i v e r s i f i c a t i o n strategies, the creation of mobile ' f l y - i n / f l y - o u t ' camps, and the development of regional mining centres, have been proposed in existing studies as viable for o f f s e t t i n g the shutdown trauma. Such mechanisms, however, tend to be applied in i s o l a t i o n , and hence do not address systematically the needs of a mining community faced with the possible shutdown and inevitable closure of i t s mine. In response, this thesis proposes and develops a systematic but f l e x i b l e planning framework for a mining community attempting to manage a mine shutdown which could possibly p r e c i p i t a t e i t s decline. By systematic i s meant an orderly and organized approach; by f l e x i b l e i s meant that t h i s approach takes into account the p a r t i c u l a r s i t u a t i o n , needs, and circumstances of each community. In developing the planning framework, the thesis examines the underlying p r i n c i p l e s of disaster planning after i d e n t i f y i n g the circumstances requiring disaster planning and considering the p a r a l l e l s to those of mining communities. Unlike most of the e x i s t i n g studies, which have focussed on permanent closure, this thesis examines, through the case studies, the problems created by an i n d e f i n i t e shutdown. With an appreciation for the community problems of both categories of shutdowns, the thesis incorporates the uncertainty inherent in mine shutdowns into the proposed planning process. 16 F i n a l l y , the thesis recognizes the need for national policy planning as part of the o v e r a l l preparedness planning framework. 1.6 ^ Research Methods and Scope Information for t h i s thesis has been obtained from a l i t e r a t u r e review and from f i e l d research on two case studies. Two Yukon mining communities, Elsa and Faro, which experienced the i n d e f i n i t e shutdown of their mines during 1982- 83, are used as case studies for the thesis. Information on each case study was obtained through interviews held in Whitehorse, Elsa, Mayo, and Faro during August, 1982. A l i s t of those interviewed i s contained in Appendix 1. The number of interviews is small compared to the t o t a l population of both communities. This was because many residents had already l e f t the communities. However, while the information obtained from those interviewed may or may not accurately represent the communities as a whole, i t i s nonetheless considered to be valuable in ascertaining some of the problems involved in a mine shutdown, as well as preparing for i t . Information regarding the reasons for the mine shutdowns, the degree of planning for possible mine shutdown, the types of responses developed once shutdown had been announced, and the problems associated with these responses was sought. A second t r i p was made to Whitehorse in August, 1983, to obtain an update of the two communities as well as to discuss 1 7 the f e a s i b i l i t y of a preparedness planning approach with government o f f i c i a l s . Further information was also gleaned from l o c a l and national newspaper a r t i c l e s which described the community consequences of many mining shutdowns, including the two case studies; while government and company documents were examined to obtain s p e c i f i c background information on the two case studies. A d d i t i o n a l l y , various studies and a r t i c l e s in the f i e l d s of resource community planning, northern resource development, impact assessment, and mining were reviewed to obtain an understanding of the main issues involved in mining communities and shutdowns. The limited l i t e r a t u r e on planning for mine shutdowns - descriptive, evaluative, and prescriptive necessitated that the review be extended to include natural disaster planning. The l a t t e r provided information on how procedures for dealing with uncertainty and for reducing s o c i a l and economic d i s l o c a t i o n . Information on the problems experienced by other mining communities during 1982-83 was obtained at a policy discussion seminar sponsored by the Center for Resource Studies at "Queen's University in the f a l l of 1983. While t h i s thesis recognizes that i t i s a mine shutdown which p r e c i p i t a t e s the decline of i t s a f f i l i a t e d community, the mine shutdown i s taken as a given. Therefore, the question of whether the shutdown should have occured i s not addressed. Rather, the need to plan for community reaction to the shutdown 18 i s addressed. Secondly, while the s o c i a l and economic consequences c r e a t e d by a mine shutdown are presented and d i s c u s s e d to i l l u s t r a t e the need to plan f o r shutdown, the t h e s i s does not examine them or t h e i r s u b s t a n t i v e m i t i g a t i o n i n any d e t a i l . 19 CHAPTER TWO THE CASE STUDIES: ELSA AND FARO Since the end of 1981, mining companies in Canada have been experiencing the worst mineral recession since the Depression (Task Force,1982,p.12). Confronted with low mineral prices and low demand, they have responded with a restructuring of their operations. For most, attempts at reducing company losses and attaining e f f i c i e n c y have been made with production cutbacks (reflected by the shutdowns of their respective mining operations for varying lengths of time), a reduction in their c a p i t a l expenditures, and l a y - o f f s in a l l areas of operations (Task Force, 1982, p.9). Such was the response of United Keno H i l l (UKH) at Elsa, and Cyprus Anvil Mining Corporation (CAMC) at Faro (see Map 2.1). Confronted with rapidly declining s i l v e r , lead, and zinc prices, both shut down their Yukon mining operations u n t i l such time as prices and/or demand for their p a r t i c u l a r minerals increased to a p r o f i t a b l e l e v e l . UKH shut down i t s Elsa operation for a stated i n d e f i n i t e period of time in July 1982, and thirteen months later resumed i t s operations. CAMC, on the other hand, o r i g i n a l l y shut down i t s Faro operation for a temporary period of three weeks (in July 1982),only to extend the r e - s t a r t i n g date three times. At the time of writing, CAMC's operation remains shut down, although a make-work project related to the mine i s currently in operation. For th e i r dependent communities, Elsa and Faro, these shutdowns have created corresponding periods of decline. The 20 MAP 2.1 - MAP OF YUKON MINING COMMUNITIES 21 purpose of the next two chapters is to describe the community consequences of the two shutdowns and to document the approaches taken by involved parties to the resulting s o c i a l and economic d i s l o c a t i o n . This background chapter provides the reader with a description of the two communities along with the causes and consequences of the mine shutdowns. 2.1 ^ H i s t o r i c a T Background Since the Gold Rush of 1898, mining has been the basis for the s o c i a l and economic development of the Yukon. Private entrepreneurship provided the i n i t i a t i v e for the development of new mines, needed communities and other infrastructure u n t i l World War I I . Since then, the development of northern mines has been a c t i v e l y encouraged and assisted ( d i r e c t l y and i n d i r e c t l y ) through federal regulatory, f i n a n c i a l , and developmental p o l i c i e s and programs. 1 During the 1960s alone, fiv e new mines were brought into existence in the northern T e r r i t o r i e s , along with four new a f f i l i a t e d communities. 2 Between 1966 and 1975, direc t assistance was provided 1The Federal government, under the BNA Act, has j u r i s d i c t i o n not only over lands north of 60° but also over the mineral resources of the Northern T e r r i t o r i e s . This includes a l l laws and regulations regarding the d i s p o s i t i o n of mineral right s , mining regulations, operating and safety rules, and mineral taxation and r o y a l t i e s (Wojciechowski,1979,p.3). 21962 - Canada Tungsten, Cantung,NWT; 1964 - Cominco, Pine Point,NWT; 1967 - Cassiar Asbestos, Clinton Creek, YT; 1967 - Whitehorse Copper, Whitehorse,YT; 1969 - Cyprus Anv i l , Faro, YT. 22 through the Northern Minerals Exploration Assistance grants which paid up to 40% of the cost of exploration in the Yukon and NWT (Wojciechowski,1979). I n d i r e c t l y , assistance was given in the form of support services: railroads (e.g. Great Slave Lake Railroad for the Pine Point Mine, NWT); roads (e.g. Roads to Resources program which, for example, resulted in the construction of the highway from Mayo to Keno C i t y ) ; and a i r s t r i p s . Further assistance was provided for labour recruitment, through immigration programs (between 1945-75, needed s k i l l e d labour was a c t i v e l y recruited from overseas) as well as manpower tra i n i n g and mobility programs (e.g. moving workers between regions and i n d u s t r i e s ) . For the construction of new mining communities, assistance was provided through infrastructure - the building of roads, the surveying and laying-out of townsites, the provision of water and sewage f a c i l i t i e s , power, schools, hospitals, and other community buildings (Wojciechowski,1979,p.25). 2.2 ^ The Mining Communities Both the mining communities of Elsa and Faro, while representing d i f f e r e n t stages in the evolution of mining communities, can be described in terms of their economic base, their physical settlement, and t h e i r s o c i a l community. Table 2.1 summarizes the i r major c h a r a c t e r i s t i c s . 2.2.1 ^ E l s a A Description Economic Base 23 TABLE 2.1 - CHARACTERISTICS OF ELSA AND FARO ELSA FARO mining company UNITED KENO HILL (UKH) - Falconbridge (majority shareholder) CYPRUS ANVIL MINING CORPORATION (CAMC) - Dome Petroleum (parent company) type of mine s i l v e r / l e a d underground and open-pit lead/zinc open p i t commence- ment date 1947 1970 community status company town municipality (second largest i n Yukon) population 424 (1981 census) 1652 (1981 census) # of mine employees 280 (1981) 660 (1981) distance from mine immediate v i c i n i t y 18 km. turnover rates 1978: 149% 1981: 39% 1970: 90% 1981: 24% mine wages between $11-15.80/hr between $ll-15/hr housing (company owned) houses (90), and bunkhouses(7) (company owned) houses (479), apts (375) for singles rents -houses: $30-75/mth. includes u t i l i t i e s -bunkhouses: $2.75/day includes meals - houses and apts.: between $15-80/month - after 10 years, no rent community f a c i l i t i e s - recreation centre, rink, company owned market, gas station, post o f f i c e - gym, theater,arena/ rink, playing f i e l d s h o s p i t a l , school (K- 12), RCMP, dentist, ai r p o r t , hotel 24 The s i l v e r - l e a d underground mining operation at Elsa is one of the oldest in Canada, and consists of several mines in the Calumet-Reno H i l l - Mayo region in the Yukon. This area was the p r i n c i p a l mining region in the Yukon betwen 1914 and 1941. Closed during World War II, i t was acquired by the Keno H i l l Mining Co. Ltd, whose name lat e r changed to United Keno H i l l Mines Ltd.(UKH), of which the major shareholder i s Falconbridge Nickel. The UKH mining operations comprise a mixture of old and new mining methods. Wooden supports, for example, are s t i l l used in underground operations, while newer ore bodies are extracted through an open-pit operation. Physical Settlement Elsa r e f l e c t s an early era of mining town in that i t i s located in the immediate v i c i n i t y of the mine s i t e . O r i g i n a l l y , i t was one of the oldest and most transient of several communities in the region. However, as operations were consolidated, so were the mining communities. Elsa, Keno City and Calumet were l e f t as the surviving communities. In the mid 1960's, Calumet was abandoned and i t s work force moved to E l s a . Aside from the mine s i t e , the physical setting of Elsa is picturesque. B u i l t on the side of a h i l l , i t i s surrounded by low mountains and wide v a l l e y s . The town i t s e l f i s divided in half by the Mayo-Keno highway. Other than the recreation h a l l and the store-bank-post o f f i c e building, a l l other buildings 25 (including houses) are connected to the mining operation and owned by UKH. Social Community The population of Elsa prior to shutdown was approximately 425, a l l of whom were employees of the mining company. Many UKH employees are older immigrants who came d i r e c t l y to Elsa from various regions of eastern Europe during the early 1950s. The proportion of single workers to those with families prior to shutdown was 70:30 (Berg, 1982). The community' has h i s t o r i c a l l y experienced high population turnover rates as a result of problems of low wages and inadequate l i v i n g conditions (Berg, 1982; Mease, 1982; P. MacDonald, 1982). This culminated in a nine-month st r i k e during 1980-81 by UKH employees. Settlement of the s t r i k e involved an agreement by the company to provide better housing along with wage increases. According to several interviews, the relationship between management and employees had improved u n t i l the time of the shutdown (Berg, 1982; Franke, 1982). The development of Elsa has been one based on private i n i t i a t i v e - both on the part of the mining company and i t s employees. The c h a r a c t e r i s t i c s of the town r e f l e c t , for the most part however, the evolving values and p r i o r i t i e s of the company, since Elsa i s a company town, e n t i r e l y owned and administered by the company. 26 2.2.2 — Faro: A Description Economic Base In 1969, after fiv e years of intensive studies and negotiations, the "one big mine needed for the Yukon" - the Cyprus Anvil lead-zinc mining project - was brought into existence. Considerable investment was made by the federal government, Northern Canada Power Commission, and the White Pass and Yukon Corporation. The c a p i t a l cost was $63 m i l l i o n for mine production equipment, concentrator, related plant services f a c i l i t i e s , and townsite. White Pass spent $22 m i l l i o n in railway transportation equipment needed to haul the ore concentrate from Faro to Skagway, Alaska, while the federal government invested $28 m i l l i o n in constructing an access road, servicing the townsite, d e l i v e r i n g power to the mine and townsite, and construction of a highway from Carmacks to Ross River (MacPherson,1978, p.127). In 1975, CAMC purchased new deposits as a means of extending the life-span of the mining operation beyond 2000 A.D. Currently, CAMC is the largest mine in the Yukon, the largest open p i t mine in Canada, and one of the largest Canadian lead- zinc producers. Its importance to the Yukon t e r r i t o r i a l economy is r e f l e c t e c in the fact that in 1981, i t d i r e c t l y and in d i r e c t l y provided employment for 20% of the Yukon's t o t a l labour force, with t o t a l wages and sa l a r i e s approximately $60 mi l l i o n (DIAND, 1982) In 1981, CAMC was bought by Hudson Bay O i l and Gas, which in turn was bought by Dome Petroleum Ltd. Due to cash flow 27 problems of the parent company, the mine is currently for sale. Physical Settlement The development of Faro s i g n i f i e d a new era in Yukon mining communities; not only in the degree to which i t was planned, but in the extent of government assistance for i t s development as well as i t s designation as an 'open' (e.g., municipal) community. Its construction in 1969 involved 3 main parties: Cyprus Anv i l , the Yukon T e r r i t o r i a l government (YTG), and the Department of Indian A f f a i r s and Northern Development (DIAND), representing the federal government. Its location, development and form was planned by a Vancouver firm. The decision to make Faro an 'open' community rather than a 'closed' company town was based on considerations of townsite financing and community administration (Foster Economic Consultants, quoted in Macpherson,1978, p.124). Currently, Faro i s the second largest community and municipality in the Yukon. Its community plan includes zoning of areas for the town centre, r e s i d e n t i a l neighbourhoods, and service industries. Similar to most mining communities b u i l t since the 1950's, the townsite i s separated from the minesite by some 18 kilometres. Faro, in contrast to E l s a , i s a young and modern suburban community, complete with $120,000 houses, modern apartment buildings, townhouses, and. an abundance of consumer goods such as boats, t r a i l e r s , and campers. 28 Social Community The community of Faro consists of CAMC management and employees, government workers, and a private service sector. The population i s r e l a t i v e l y young, with most residents between the ages of 29 and 3 4 . Interviews with Faro residents indicated a good relationship between CAMC and the community. In spite of their differences in size, status, sophistication, and so c i a l c h a r a c t e r i s t i c s , Elsa and Faro are characterized by their dependency on their respective mines for their economic mainstays and for t h e i r continued existence. The following section describes the problems associated with such dependency. 2.3 2 Reasons for Indefinite Shutdown [Mjinerals have time value... Resources are not, they become. They expand and contract in response to human wants and needs and to technological,economic and p o l i t i c a l conditions (Spooner,1981, p.9). It appears that three major factors were responsible for the decisions of UKH and CAMC to shut down their mining operations i n d e f i n i t e l y (these are summarized in Table 2.2): •declining s i l v e r , lead and zinc p r i c e s . As depicted in Table 2 . 3 , s i l v e r and lead prices had declined approximately 60% and 50%, respectively, between 1980 and the end of 1982, while the price of zinc had dropped about 20% from i t s 1981 peak; 29 TABLE 2.2 - REASONS FOR SHUTDOWN UKH - ELSA CAMC - FARO - high operating costs and low s i l v e r prices were given as o f f i c i a l reasons - $13.6 m i l l i o n loss i n 1981 following a $7.7 m i l l i o n p r o f i t i n 1980 - loss a t t r i b u t a b l e to: 1) $10.6 m i l l i o n write-off of expansion project costs, project suspended Nov/81 2) nine month s t r i k e between Sept/80 and May/ 81 at a time of record high s i l v e r p r i c e s . 20% decline i n s i l v e r production. - high operating costs, heavy losses, low lead & zinc prices - heavy losses incurred i n 1981-82: - $7.2 m i l l i o n i n f i r s t nine months of 1981 - $15.7 m i l l i o n i n f i r s t quarter of 1982 due to: 1) decline i n sales revenue due to lower lead prices & production; 2) operating expenses/tonne of ore milled increased by 108.6% between 1978 & 1981; 3) a debt-financed expansion project ($240 m.) designed to extend l i f e - span of operation t i l 2000 A.D. CAMC borrowed $130 m i l l i o n to acquire and begin project. $7 m i l l i o n was paid i n i n t e r e s t i n 1st quarter of 1982. TABLE 2.3 - AVERAGE ANNUAL PRICES OF MAJOR METALS Average annual p r ices of major metal3 i n Canadian funds , (1075 - 1932) 1 9 7 8 1 9 7 7 1 9 7 3 1 9 7 9 1 9 8 0 . 1 9 8 1 1 9 8 2 C o p p e r ( c e n t s / l b ) • 6 8 . 3 8 9 6 9 S C 6 7 4 5 8 6 1 0 7 . 5 4 6 1 1 7 . 7 5 1 0 0 3 7 0 8 8 241 G o l d ' ( S p e r / o i ) 1 2 3 . 1 0 7 1 5 7 0 8 9 ' 2 2 7 . 9 0 7 3 5 9 2 8 9 - 7 1 6 . 0 8 7 §51 1 7 8 4 6 1 711 L e a d ( c s i ' . ' i s / i b ) 2 2 . 6 S 3 31 4 8 2 3 6 8 2 3 5 9 9 2 3 , • 4 9 . 3 5 0 4 4 521 3 2 8 4 5 l / i o l y b d u n u i n O r e ( S / l t a ) 2 9 0 9 3 9 1 7 5 3 7 1 8 9 5 7 , 11 4 2 0 - 1 0 1 8 3 9 7 4 0 N i c k a l M e t M ( S / i b ) 2 2 2 5 2 4 4 6 2 4 6 6 3 .171 3 9 9 2 4 111 3 9 4 4 S i i v o r ( S / o i ) ,'. 4 . 2 G 8 4 9 2 0 1 6 1 /1 1 2 . 9 7 4 2 4 . 0 5 8 1 2 6 1 7 . 9 . 7 8 0 2 i n c ( c e n t s / l b ) 3 7 6 J 4 3 5 . 5 3 1 3 4 . 7 5 7 . 4 3 . 7 1 7 4 4 0 5 :.; • 5 4 . 2 4 0 4 3 . 6 7 0 E x c h a n g e po t t f ( U S d o l l a r - - ) 1 . 1 7 1 5 2 1 0 3 1 , 1 6 9 0 0 3 5 6 1 . 1 9 8 9 8 0 3 5 1 . 2 3 2 4 7 3 5 2 Sobfc i f . M«MI. W»ok ' L o n d o n . P . M . :.; • ,.: r ^ . SOURCE: Tibbo (1983) 31 •higher operating costs and lowered production. Both mining companies c i t e d increased operating costs in the areas of transportation, power and labour. For example, in the case of UKH, a high wage settlement after a b i t t e r s t r i k e created increased labour costs. CAMC c i t e d an increase of 108% between 1978 and 1981 in operating costs (DIAND,1982). However, i t appears that t h i s was primarily due to increased administration costs and interest charges connected to the expansion program discussed below; •heavy losses as a result of i l l - t i m e d expansion programs. The mineral boom of 1979-80 resulted in expansion programs by both companies. Additional employees were hired, mine f a c i l i t i e s were expanded or improved, and new properties were acquired. By 1981 however, metal prices were rapidly declining, making such expansion no longer viable. UKH wrote off i t s Venus expansion project at a loss of $10.6 m i l l i o n (UKH,1981,p.5). This aggravated i t s loss of revenue during the st r i k e period in 1980, a time of record high s i l v e r prices (UKH,1981,p.11). CAMC had embarked on an ambitious 8 year expansion program involving the acquisition of two new properties at a cost of $240 m i l l i o n , of which $130 m i l l i o n were borrowed funds. The cost of financing t h i s expansion represented 42% of the t o t a l operating cost increase in 1981. Since the f i r s t quarter of 1981, CAMC has been in a loss position as a result of interest rates estimated at $2 m i l l i o n per month and low mineral demand. CAMC found i t increasingly d i f f i c u l t to meet i t s operating costs and consequently, had no choice but to shut down i t s mine 32 (DIAND,1982; J . Carrington, 1982). Currently, the mine is for sale. 2.4 - Community Consequences of Indefinite Shutdown The i n d e f i n i t e shutdowns resulted in major s o c i a l and economic d i s l o c a t i o n for the residents of Elsa and Faro and precipitated the in d e f i n i t e decline for both communities. As Table 2.4 indicates, however, such d i s l o c a t i o n had already commenced with the permanent la y - o f f s experienced a few months e a r l i e r . The following provide a brief overview of the major community consequences (these, along with T e r r i t o r i a l and national impacts are summarized in Table 2.5): •loss of employment for the majority of residents. In Elsa, 270 were l a i d o f f , while the remaining 20 were kept on for maintenance work. In Faro, a t o t a l of 600 mine employees were l a i d off i n d e f i n i t e l y . The CAMC shutdown also caused the loss of 83 construction jobs in Faro, along with approximately 124 jobs in the private service sector (DIAND, 1982, p.61). Lay-offs were also experienced in Whitehorse as a result of the CAMC shutdown. For example, immediately following that shutdown, 131 White Pass employees were l a i d off (DIAND, 1982, p.59). •loss of community population due to out-migration either by choice (Faro) or by eviction (Elsa). In the l a t t e r case, the company decision to close the town resulted in the relocation of 33 TABLE 2.4 - INDEFINITE MINE SHUTDOWN AT ELSA AND FARO: THE PROCESS UKH - ELSA CAMC - FARO -Mar 3/82- permanent lay of f of 88 or 280 workers -June 28/82 - i n d e f i n i t e shutdown announcement made by Bd. of Directors (Toronto) - 2 wk. notice terms: 135 unionized workers l a i d o f f July 13 -46 to shut down mine - 25 l a i d o f f Oct 31 - relocation of a l l but caretakers by end of Aug/82 -July 1/83 - 120 workers re c a l l e d -August 11/8 3 - operation of mine resumed, t o t a l employees=140 Feb 4/82 - announcement of 10% st a f f cut by end of year through a t t r i t i o n Mar 9/82 - announcement of lay- o f f of 95 of 770 employees Mar 18/82 - permanent l a y - o f f of 95 Mar 24/82 - announcement of 3 week temporary shutdown st a r t i n g July 1 A p r i l 3 0/82 - announcement of extension of shutdown to 2 months from June 4-Aug 2 June 4/82 - 600 l a i d o f f July 9/82 - extension of shut- down to October/82 Sept 8/82 - extension of shut- down to spring 1983 May 24/83 - job creation project begins TABLE 2.5 - SOCIAL AND ECONOMIC IMPACTS OF UKH & CAMC MINE SHUTDOWNS LEVEL UKH CAMC ind i v i d u a l - forced relocation - unemployment - uncertainty as to r e c a l l - 1st extension: extended holiday - 2nd extension: uncertainty & anxiety esp. for those with school-aged children - 3rd extension: continued uncertainty community - reduced services - loss of s o c i a l networks for those remaining - population halved - loss of major source of revenue ( $ l m i l l i o r municipal taxes) - reduction i n amenity provision t e r r i t o r i a l - increased demand for s o c i a l services as a re s u l t of these two shutdowns; unemployment increased by 4% to 17%,-as a r e s u l t of l o s t revenue, YTG had to borrow $4 3 m i l l i o n from federal government to pay b i l l s ; loss of population (7%) of whom a large majority were s k i l l e d workers; shutdown of other major private employers dependent upon CAMC - provision of extra assistance to CAMC ($2.6 m i l l i o n assistance) national - increased demands for UIC and welfare. CAMC received a special assistance package of which $19.6 m i l l i o n i s an in t e r e s t free federal loan as well as $4 m i l l i o n i n aid from UI Act and NEED program. SOURCES: DIAND (1983a), YTG (1982), interviews. 35 a l l but a handful of employees who were retained to shut down the mine. In Faro, increasing out-migration occurred as the shutdowns were extended. Many mining employees chose not to wait out the winter at Faro, where the cost of l i v i n g i s much higher than elsewhere. The population of Faro had dropped from a pre- shutdown l e v e l of just below 2000 to a current l e v e l of approximately 750 (Bazowski,1983). • s o c i a l d i s l o c a t i o n created by the loss of population and relocation of employees. Residents of Elsa were shocked by the company's e v i c t i o n requirement; for even during the s t r i k e period in 1980, they had been allowed to remain in company houses (P. MacDonald, 1982). Further, both Elsa and Faro had experienced much lower population turnover rates within the l a s t few years, res u l t i n g in the development of stronger s o c i a l networks. The consequent loss of population precipitated, for example, a decline in the number of voluntary organizations. One Faro resident pointed out that i t would take a long time to regain the sense of community that existed prior to shutdown (E. Carrington, 1982). •a reduction in services and amenities. In Faro, for example, the shutdown of the mine and the loss of population resulted in a loss of income and subsequent decline in the tax base and consumer base which, in turn, affected the a v a i l a b l i t y of services (such as a i r f l i g h t s , banking, grocery and postal services) and the municipality's a b i l i t y to meet i t s debt payments. 36 •uncertainty. Those interviewed indicated that of a l l the consequences experienced at a community l e v e l , uncertainty was the most d i f f i c u l t to deal with. The psychological costs of uncertainty over the duration of the shutdown made long-range planning d i f f i c u l t while uncertainty over what to do during the shutdown, for example, whether to leave or not leave, created considerable i n s t a b i l i t y at both individual and community l e v e l s . In addition, residents in Faro were exposed to continuous rumours as to the reopening of the mine. This was due to: •the lack of an information system sponsored by either the company or government whereby a resident could learn of the current s i t u a t i o n . Queries were directed to Dome's head o f f i c e in Calgary. •meetings between CAMC and the federal government, and CAMC/DIAND/union were held in other centres such as Ottawa and Calgary, with l i t t l e or no l o c a l community input. This tended to heighten feelings of uncertainty and insecurity, especially for the private service sector. The UKH and CAMC in d e f i n i t e shutdowns, while necessary for the economic e f f i c i e n c y of both companies, created serious s o c i a l and economic dislocation for their respective a f f i l i a t e d communities, Elsa and Faro. It quickly became evident that l i t t l e had been undertaken by involved parties in terms of preparation for such an occurence. The following chapter outlines the responses of those involved and documents some of the problems which these responses created. 37 CHAPTER THREE CURRENT COMMUNITY RESPONSES TO MINE SHUTDOWNS The objective of a shutdown, from a company perspective, i s to cut costs and reduce company losses in a declining mineral market. For the affected community however, shutdown means the loss of employment for the majority of the residents, as well as a threat to i t s future existence. From a s o c i e t a l perspective, a shutdown often results in p o l i t i c a l pressure to "reduce the resulting s o c i a l and public costs and to introduce some so c i a l equity" (Gordus,1981, p.9). It i s within t h i s framework of c o n f l i c t i n g interests, goals, and p r i o r i t i e s that the responses to the community di s l o c a t i o n created by a mine shutd.own w i l l be examined. 3. 1 2. Planning and Provi sions Prior to N o t i f i c a t i o n In both situations, there was l i t t l e planning undertaken by involved sectors prior to the f i r s t l a y o f f s . Several reasons for th i s lack of planning were c i t e d during interviews with mine management, community residents, union o f f i c i a l s and government representatives. These include: •the focus on continued growth and even expansion plans as a result of the mineral boom of 1979. In the words of the UKH mine manager, "No plans were made a year ago for temporary ( i . e . , i n d e f i n i t e ) closure as a l l eyes were on expansion" (Dickson, 1982). This perspective was echoed by union executives and mine employees both at Elsa and Faro. Further, the sudden drop in 38 metal prices had caught most off guard and gave l i t t l e time for developing a l t e r n a t i v e s . •the lack of previous shutdown experience at UKH and CAMC. Most of those interviewed mentioned that neither UKH nor CAMC had experienced a shutdown before and therefore there hadn't been any reason to prepare for i t s p o s s i b i l i t y . Perhaps this r e f l e c t s a cognitive dissonance on-the.part of those interviewed, since, as has been mentioned above, shutdown i s an inherent and inevitable feature of mining which had been experienced by some of the miners at other mines. According to long-time UKH miners, the company had been operating since 1947 on a year to year basis (Mease, 1982). In 1966, UKH gave n o t i f i c a t i o n of the permanent closure of i t s Elsa operation, an event which was never realized. A study taken at the time indicated a similar lack of preparedness by those to be affected (YTG,1967). •the 'mother A n v i l ' syndrome. From interviews in August, 1982, with those associated with the CAMC shutdown, there had been widespread b e l i e f that the government would never l e t Cyprus Anvil continue i t s shutdown due to i t s economic importance to the Yukon t e r r i t o r y (Power, 1982; M i t c h e l l , 1982). The security which such a b e l i e f created appeared to be compounded by the expansion plans by CAMC as well as by i t s new housing investment in the Faro townsite. The permanent structure of Faro lent credence to the i n v i n c i b i l i t y and permanency of the community. It appeared that some residents were making plans for their future in Faro, not elsewhere. The wife of the CAMC mine manager 39 pointed out that because she and her husband considered Faro their home they had done l i t t l e planning as to other alternatives (E. Carrington, 1982). The same feelings of security were evident in Elsa in spite of i t being a company town. There was a widespread bel i e f that even i f the mine shut down, employees would be allowed to remain in company houses and hence,for the majority, few 'contingency' plans were made (G. MacDonald, 1982). •the 'crying wolf' syndrome. According to several people familiar with the Elsa operations, UKH had been giving informal notice of the temporary nature of i t s operations since 1947. After a while, few took these warnings seriously and hence, people were surprised when i t actually happened. •perceptions of shutdown impacts. It appeared that many of those interviewed had not considered the f u l l nature and extent of the soc i a l and economic impacts accruing from a shutdown (Berg, 1982; Wight, 1982). In part, t h i s may have been due to changes in the general economic climate. In the past, d i s l o c a t i o n has been offset by employment opportunities in other mines, regions or sectors; whereas currently, impacts appear to be exacerbated by the severity and extent of the current recession which has, in e f f e c t , shut off other employment opportunities. Despite the lack of preparedness plans at the time of shutdown n o t i f i c a t i o n , some basic provisions were in place in Col l e c t i v e Agreements as well as various s o c i a l programs. The 40 unions and mining companies had negotiated lay-off and termination conditions which were included in their respective C o l l e c t i v e Agreements.1 The relevant sections of these Agreements are reproduced in Appendix 2; as w i l l be noted, these conditions s t i p u l a t e a minimum n o t i f i c a t i o n period for both lay- o f f s and terminations in the case of the Elsa operation and for termination only in the case of CAMC. Both outline the s p e c i f i c s of relocation assistance. In addition, public assistance programs were available to a s s i s t in mitigating some of the economic consequences of unemployment. These relevant programs are summarized in Table 3.1. It should be pointed out that these programs are designed to help a l l Canadians and were not developed s p e c i f i c a l l y for the s o c i a l and economic d i s l o c a t i o n created by a mine shutdown. 3.2 ^ Responses Following Shutdown N o t i f i c a t i o n The following provides an outline of the adjustments which occurred during the months immediately following n o t i f i c a t i o n of shutdown. 1Both C o l l e c t i v e Agreements r e f l e c t the minimum standards established by the Canada Labour Code for termination requirements. The Code does not require n o t i f i c a t i o n for temporary or i n d e f i n i t e l a y - o f f s . Unemployment 1nsurance (Ul) F e d e r a l - Canada Employmen £ Immigration Commission (CEIC - to m a i n t a i n a minimum l e v e l of income f o r a p e r i o d o f time. - a l l t h o s e employed i n the l a b o u r f o r c e f o r a min. o f 1 0 - l ' l wks. and who have c o n t r i b u t e d . - a u t o m a t i c program a l t h o u g h the l a i d - o f f worker must a p p l y f o r IU b e n e f i t s . Work S h a r i n g F e d e r a l - Sec. 37 o f Ul A c t - t o a v e r t temporary l a y - o f f s through s h o r t e r work week, work s h a r i n g and Ul b e n e f i t s f o r days not worked. - employer must demonstrate t h a t the s h o r t a g e o f work i s temporary £ unavoidabl< - employees must be e l i g i b l e f o r U l . - r e q u i r e s an a g r e e - ment between employer :.£ employee t o d i v i d e a v a i l a b 1e work i n o r d e r t o a v o i d l a y o f f s Manpower Consul t a t i ve S e r v i c e s (MCS) F e d e r a l - CE£IC - t o a s s i s t employers £ employees i n f i n d i n g re-employment o r a l t e r n . s o l u t i o n s t o l a y - o f f s t h rough j t . n e g o t i a t i o n s - i n d i v i d u a l f i r m s - i n d u s t r i a l s e c t o r s - p a r t i c u l a r g e o g r a p h i c a r e a s - r e q u e s t f o r MCS must be made by employer i n agreement w i t h u n i o n . - p r i m a r i l y f o r t e r m i n a t i o n s / c l o s u r e s Mobi1i t y 3rogram F e d e r a l - CESIC - t o a s s i s t employers i n f i n d i n g new employment f o r l a i d - o f f workers 6 t o ass i s t i n t h e i r r e l o c a t i o n . - a s s i s t a n c e i s o f f e r e d t o employers who have e s t . a MCS a djustment committe< - up t o 50$ o f r e l o c a t i o n c o s t s a r e r e i m b u r s e d . Job C r e a t i o n F e d e r a l - S e c t i o i 38 of Ul A c t - t o c r e a t e s h o r t - t e r m employment p r o j e c t s f o r t e m p o r a r i l y unemployed workers £ to r e t a i n them i n the community. - f i r m s f a c e d w i t h s h o r t term l a y - o f f s - must not r e s u l t i n u n f a i r c o m p e t i t i v e advantage t o f i rm - p e r m i t s e x t e n s i o n o f j o b c r e a t i o n p r o j e c t from 52-58 weeks Canada Communi t y Development P r o j e c t s F e d e r a l - CE£IC - to c r e a t e j o b s f o r unemployed i n communities which would be o f v a l u e to community - n o n - p r o f i t o r g a n i z a t i o n s - Band C o u n c i I s - emphasis i s on the h i r i n g o f . ' d i s a d v a n t - aged' p e o p l e - maximum time f o r program i s 3 y e a r s . NEED (New Employment £ E xpansion Development) F e d e r a l - CE&IC - t o c r e a t e i n c r e m e n t a l employment o p p o r t u n i t i e s f o r unemployed. - j t . program between f e d e r a £ prov. o r t e r r i t o r i a l gov't: - must employ l o c a l p e o p l e - j o b s must be s h o r t term i n n a t u r e but l e a d t o o n g o i n g - d i r e c t j o b c r e a t i o n . p r o j e c t w i t h p r i v a t e s e c t o r , - m i n . 12 wks; max- 52 perm, j o b s a t end. i-3 > W L - 1 I 42 3.2.1 ^ Elsa The Mining Company The responses of UKH r e f l e c t e d a primary concern with meeting i t s obligations contained in i t s C o l l e c t i v e Agreement, as well as with reducing the costs of shutting down i t s operations. As mentioned above, the terms of l a y - o f f s , terminations, and relocation were bound by i t s C o l l e c t i v e Agreement. These conditions were outlined in a meeting between company and union, followed by a written notice to the United Steelworkers of America (USWA) union l o c a l by the mine manager. Copies of t h i s notice are included in Appendix 3. O r i g i n a l l y , UKH1 provided two weeks notice for both the lay-off and relocation of i t s employees (P. MacDonald, 1982). This was met with opposition by the union who negotiated to have the relocation date extended by one month to the end of August (Franke, 1982; G. MacDonald, 1982). UKH resisted a l l attempts by the union and Yukon T e r r i t o r i a l Government (YTG) to allow employees to remain in Elsa during the shutdown, r a i s i n g the suspicion that Falconbridge/UKH was" 'cleaning house' - that i s , getting r i d of some of the more r a d i c a l union members who were involved in the prolonged 1980 s t r i k e - or else were wanting to l e t go of the older, less product ive workers (Franke, 1982). This suspicion 1The actions of UKH r e f l e c t e d , for the most part, the directions of i t s parent company in Toronto, Falconbridge. The l o c a l mine manager, for example, received n o t i f i c a t i o n of shutdown the day before he n o t i f i e d the union (Dickson, 1982). 43 was compounded by the fact that s i l v e r prices began to r i s e shortly after shutdown was announced. According to UKH, t h i s suspicion was erroneous on two accounts: 1) a l l union employees were on r e c a l l for two years; and 2) the company requires workers s k i l l e d in the old-fashioned techniques used in i t s underground operations and would be hard- pressed to find such workers elsewhere in Canada (Dickson, 1982). Hence, while UKH participated in the many discussions held between various sectors, i t appeared resolute in i t s decision to both lay off and relocate i t s workers. At the time of the shutdown announcement, UKH claimed that i t had only $3 m i l l i o n remaining in i t s operating budget and could not afford to retain i t s employees in Elsa during shutdown (Dickson, 1982). The Union It appears that the responses of the USWA union l o c a l #924 were concerned more with the issues of relocation and housing, than of the actual l a y - o f f s . For while the union had compiled a l i s t of i t s members' work s k i l l s for prospective employers following the f i r s t round of terminations in March, such compilation was not undertaken due to a greater concern among employees over settlement of their housing (Franke, 1982; G. MacDonald, 1982). As mentioned above, the union was able to negotiate a one month extension of the relocation date. However, i t was less 44 successful in i t s attempts to persuade UKH to allow a number of families to remain in E l s a . Interviews with union o f f i c i a l s in both Elsa and Whitehorse, along with a review of l o c a l newspaper reports, revealed a strategy to use the media as well as p o l i t i c a l pressure to obtain this concession. However, requests for action regarding "residents being forced out of their homes" were brought up at both the House of Commons and the T e r r i t o r i a l Legislature, in addition to a series of telexes between union executive and DIAND o f f i c i a l s , were unsuccessful. It was later revealed that while i n i t i a l l y there were 24 employees who wished to stay in Elsa, many of these l e f t during the period of housing negotiations. The union was hard-pressed to obtain additional signatures, and f i n a l l y dropped the issue (Rudychuk, 1982). The Residents Few employees and their families were remaining in Elsa at the time of f i e l d research in late August, 1982. Most single workers had been required to leave by July 20th, as outlined in the lay-off notice contained in Appendix 3. Of those remaining, 46 were retained for maintenance work, while an additional few did not know where they were going to move to. A handful of long-time employees had b u i l t private homes and farms in the area and planned to l i v e in them while waiting out the shutdown. Due to s e n i o r i t y , they would be among the f i r s t to be r e c a l l e d . 45 It i s not clear whether those who had already l e f t had planned for the p o s s i b i l i t y of shutdown. Interviews with those remaining suggested that t h i s was not the case (Berg, 1982; Mease, 1982), although v e r i f i c a t i o n at the time was impossible. The Governments Es s e n t i a l l y , the responses by both DlAND (representing the federal government) and YTG refl e c t e d their concerns with minimizing the s o c i a l costs of the shutdown. Representatives of both levels met with UKH, the USWA l o c a l executive, and the lo c a l MLA to discuss the a v a i l a b i l i t y and implementation of assistance programs (P. MacDonald, 1982). The f i r s t meeting was held one week after the shutdown n o t i f i c a t i o n where i t was decided to f i r s t v i s i t Elsa to determine the residents' needs before implementing these programs. E s s e n t i a l l y , e f f o r t s focussed on: •employment opportunities •vocational training •processing of Unemployment Insurance applications •subsidized housing in Mayo and Whitehorse by the Yukon Housing Corporation (the T e r r i t o r i a l counterpart of CMHC) • a v a i l a b i l i t y of welfare, i f needed, u n t i l the U.I. benefits were ava i l a b l e . However, a l l but the processing of U.I. claims were unsuccessful. Both the company town status of Elsa and in d e f i n i t e length of the mine shutdown made Elsa i n e l i g i b l e for the federal government's work-sharing and make-work programs 46 (Pearson, 1982). Secondly, attempts at offering vocational training f a i l e d . YTG and Canada Manpower joined forces and submitted a proposal to UKH in which YTG would offer up-grading classes and an examination for a trade t i c k e t to UKH workers. UKH refused, leaving both governments with no option as the workers would have no place to stay while taking the courses since UKH owned the housing (Pearson, 1982). S i m i l a r l y , e f f o r t s to obtain subsidized housing in Elsa as a means to retain the workforce were also unsuccessful. In response to YTG's attempts to persuade UKH to keep i t s houses open during the winter months, UKH agreed to do so only i f YHC would subsidize the costs of heating etc. According to UKH, costs were too high for i t to subsidize i t s housing without the mine in operation. It estimated the costs to be $15,000 per month or approximately $625 per house per month (P. MacDonald, 1982). Much debate was given to the accuracy of such costs and to the fact that i t would be cheaper for UKH to retain i t s workforce for the duration of the shutdown than to relocate them.1 Further complications arose from the fact that in order for the houses to be subsidized by YHC, CMHC would have to inspect them f i r s t (Robb, 1982). 1Indeed, i f everybody stayed, according to the figures provided to the writer by the l o c a l mine manager, heat and e l e c t r i c i t y costs were estimated to be $1.5 m i l l i o n per year, whereas the costs for relocation and termination were calculated to be a l i t t l e over $2 m i l l i o n . In his eyes, $.5 m i l l i o n was i n s u f f i c i e n t for contingency funds. 47 The housing issue was dropped after i t was realized that most of the residents who had o r i g i n a l l y expressed interest in remaining in Elsa had already l e f t . It appeared that few were w i l l i n g to remain in Elsa during the winter months while unemployed and pay comparable rents to those in Vancouver. F i n a l l y , the provision of welfare benefits to Elsa residents proved to be a situation in which the e l i g i b i l i t y requirements were not properly examined prior to discussing them with the residents. Due to their high wages and levels of equity, none of the residents of Elsa were e l i g i b l e for welfare. Further confusion also surrounded the provision of housing assistance and the a v a i l a b i l i t y of YHC rental units elsewhere. Apparently, Elsa residents were t o l d how to apply for housing units in Whitehorse and nearby Mayo, but were not informed that there was no vacancy in those in Whitehorse (Davies, 1982). 3.2.2 ^ Faro It i s more d i f f i c u l t to outline responses by sector to the CAMC shutdown announcement owing to the i n t e r s e c t o r a l nature of adjustments as well as the number of shutdown extensions (three) which followed the i n i t i a l announcement. As i s summarized in Table 3.2, a number of factors were involved in developing suitable responses to the shutdown. F i r s t , the T e r r i t o r i a l repercussions of the shutdown were recognized early on by DIAND and YTG; hence, their concern was not so much with the a s s i s t i n g of a mining operation as with the 48 TABLE 3.2 - CHRONOLOGY OF RESPONSES TO CAMC SHUTDOWNS J U N E 1 982 M i n e S h u t d o w n J U L Y 1 !?82 M a k e - w o r k P r o j e c t C A M C r e q u e s t s $ 88 m i l l i o n i n g o v e r n m e n t a s s i s t a n c e t o r e - o p e n i t s m i n e S E P T 1 982 3 r d e x t e n s i o n o f m i n e s h u t d o w n D I A N D M i n i s t e r r e c e i v e s F e d e r a l C a b i n e t a p p r o v a l t o s e e k 4 p a r t y a g r e e m e n t o n m i n e r e - o p e n i n g O C T 1 982 4 p a r t p a c t s i g n e d b e t w e e n C A M C , D I A N D , Y T G , a n d U S W A #1051 o b t a i n i n g c o n s e n s u s o n r e q u i r e m e n t s f o r r e - o p e n i n g m i n e : (1) s e t t l e m e n t of n e w C o l l e c t i v e A g r e e m e n t (2) d e v e l o p m e n t o f a n ' a c t i o n p l a n 1 b y C A M C (3) i n i t i a t i o n b y M i n i s t e r o f D I A N D of d i s c u s s i o n a t C a b i n e t l e v e l of C A M C ' s a n d Y T G 1 s p r o b l e m s . D E C 1 982 S i g n i n g of n e w C o l l e c t i v e A g r e e m e n t b e t w e e n C A M C a n d U S W A #1051 M A R 1983 D i r e c t l o b b y i n g i n O t t a w a b y Y u k o n ' C o m m o n F r o n t i , ; f o r r e - o p e n i n g of m i n e A P R I L 1983 F e d e r a l C a b i n e t A p p r o v a l of $50 m i l l i o n a s s i s t a n c e p l a n M A Y 1983 T w o y e a r w a s t e s t r i p p i n g p r o g r a m b e g i n s . SOURCES: DIAND (1983a); interviews 49 T e r r i t o r i a l economy. Secondly, CAMC's parent company, Dome, was involved in serious negotiations at the time with the federal government in an e f f o r t to reduce the l i k e l i h o o d of i t s t o t a l f i n a n c i a l collapse. As a resu l t , discussions between CAMC and DIAND were but a part of these negotiations. F i n a l l y , CAMC and USWA #1051 were required by their C o l l e c t i v e Agreement to enter into contract negotiations during the f a l l of 1982. The consequences of thi s bargaining would obviously have considerable effect on the economic v i a b i l i t y of re-opening. Responses to the shutdown i n i t i a l l y consisted of the development of make-work projects. Before the f i r s t shutdown in June, CAMC approached the Canadian Employment and Immigration Commission (CEIC) about available options for retaining i t s workforce in Faro (Pearson, 1982). In conjunction with i t s USWA l o c a l , i t submitted a community make-work proposal. This proposal was unique in the sense that i t was the f i r s t ' j o i n t - e f f o r t ' proposal to be submitted to CEIC, and i t was open to a l l Faro residents including private service sector employees. B a s i c a l l y , i t involved a variety of community be a u t i f i c a t i o n projects which eventually employed a maximum of 25 people. Its success was undermined by payment delays of 6-7 weeks which led to several participants q u i t t i n g in protest (Power, 1982). As outlined in i t s press release (contained in Appendix 4), CAMC provided rental and heating subsidies to those l a i d off employees remaining in Faro following the t h i r d extension. In addition, i t maintained the community recreation centre and was 50 involved in the offering of adult education courses during the winter (Whitehorse Star, Sept. 8 1982, p.3). In the spring of 1983, following the development of the assistance program which is discussed below, CAMC offered a relocation package (e.g., moving expenses to Vancouver or Edmonton) to those remaining but who were unlikely to be rehired. Many residents took advantage of the opportunity and l e f t (Bazowski, 1983). Attempts to reopen the mine involved several components, which are outlined in Table 3.2 (see page 48). In October, 1982 - some four months following the i n i t i a l shutdown - agreement was reached between YTG, DIAND, CAMC, and USWA regarding the necessary conditions and sectoral r e s p o n s i b i l i t i e s for obtaining consensus on the c r i t e r i a for reopening. These included: •the negotiation of a new union contract •the development of a feasible 'action' plan by CAMC for resumption of i t s operations •the i n i t i a t i o n by the Minister of DIAND of discussion at the federal Cabinet l e v e l of CAMC's and YTG's problems (Globe and Mail, Oct.8, 1982, p.Bl2). A new C o l l e c t i v e Agreement which included l i m i t i n g wage increases and benefits, among other items, was signed after lengthy negotiations in December 1982; while CAMC was s t i l l pressing DIAND for acceptance of i t s $88 m i l l i o n assistance package which included the following: •$75 m i l l i o n to develop the new ore body; •$13 m i l l i o n in power and transportation subsidies; •contined deferment of royalty payments 51 •continuation of the federal government's moratorium on taxation of northern benefits (Whitehorse Star, Jan.5, 1983, p.3). Not surpris i n g l y , the federal government was not in agreement with the amount nor the intent of t h i s assistance request. However, between October, 1982, and early 1983, i t offered no counter-proposals. In March 1983, a delegation from the Yukon ' d i r e c t l y lobbied' the federal government in Ottawa requesting that the mine be re-opened. One month l a t e r , and almost 10 months after the i n i t i a l shutdown, the Minister of DIAND announced Cabinet approval of a $50 m i l l i o n mine re-opening plan. This two year plan is funded with $25 m i l l i o n in CAMC funds, a $19.6 m i l l i o n federal government loan, $4 m i l l i o n from federal U.I. and NEED programs, and $1 m i l l i o n from YTG (DlAND,1983a). Commencing in late May 1983, i t involves a waste-stripping program, employing approximately 210. Faced with the prospect of two of i t s three operating mines (UKH and CAMC) shutting down, and the th i r d (Whitehorse Copper) closing permanently in December 1982, YTG, in May 1982, created an interdepartmental Task Force to examine their implications. S p e c i f i c a l l y , the mandate was three-fold (YTG, 1982): •to prepare a f u l l and comprehensive assessment of the problem •to develop a short term economic forecast •to propose short and long term remedial actions that might be taken by both T e r r i t o r i a l and Federal governments to help a l l e v i a t e the current and expected impacts on Yukoners. 52 Four ' a c t i o n a l t e r n a t i v e s ' were i d e n t i f i e d : •no a c t i o n •request d i r e c t f i n a n c i a l and program a s s i s t a n c e from Canada • r e a l l o c a t e YTG resources to m i t i g a t i v e p o l i c i e s and programs •develop a j o i n t Canada-Yukon a c t i o n plan using the resources of both governments. The o p t i o n chosen was the l a s t which focussed p r i m a r i l y on proposing j o i n t m i t i g a t i o n of economic impacts through minimizing employment l o s s e s ( f o r example, through a Temporary R e l i e f A c t i o n Program i n v o l v i n g the d i r e c t c r e a t i o n , of jobs, maintenance of e x i s t i n g 'threatened' jobs, t r a i n i n g , and small business c o n t r a c t s ) . While YTG was s u c c e s s f u l i n o b t a i n i n g f e d e r a l f i n a n c i a l support f o r some of i t s p r o p o s a l s , the f e d e r a l government was r e l u c t a n t to i n v e s t i n only short-term, 'stop-gap' measures. 3.3 ^ Problem Areas According to i n t e r v i e w s with i n v o l v e d a c t o r s , there were s e v e r a l u n d e r l y i n g problems which c o n s t r a i n e d the development of a p p r o p r i a t e responses to both shutdowns. E s s e n t i a l l y , these were: l i m i t e d n o t i f i c a t i o n , d e l ays i n implementation of remedial programs, e l i g i b i l i t y and c o - o r d i n a t i o n problems, and c o n f l i c t over r o l e s and r e s p o n s i b i l i t i e s . 53 3.3.1 2 Effectiveness of Responses The two week n o t i f i c a t i o n period given for the UKH shutdown, and the r e l a t i v e suddenness (given i t s economic importance) of CAMC's o r i g i n a l notice as well as each of i t s three extensions, provided l i t t l e time for involved parties to work out appropriate response and mitigative strategies as well as r e s p o n s i b i l i t i e s . While inadequate advance notice may stem in part from the l i m i t a t i o n s of existing lay-off l e g i s l a t i o n as well as i n s u f f i c i e n t provisions in the C o l l e c t i v e Agreements, in both cases i t was the parent companies which made the decisions regarding shutdowns and the speed at which they would take place. It is obvious that the e a r l i e r n o t i f i c a t i o n i s given regarding a closure or a shutdown, the more-time there is to develop suitable responses and therefore reduce or at least mitigate i t s s o c i a l and economic d i s l o c a t i o n . Proponents of more stringent n o t i f i c a t i o n requirements argure that the mining company would be forced to consider shutdown more seriously and would perhaps seek other a l t e r n a t i v e s (Heartwell, 1982). It has also been argued that adequate advance n o t i f i c a t i o n might reduce the adversarial atmosphere that tends to be generated by a sudden unexpected shutdown (Fleming, 1978). Not s u r p r i s i n g l y , the reaction by a mining community and government to a shutdown has as much to do with the extent of advance notice and degree of consultation as i t does with the actual 54 occurrence. For example, c o n f l i c t s between UKH and USWA #924 at Elsa were heightened by UKH's two-week notice for both layoff and relocation. Several problems r e l a t i n g to the e l i g i b i l i t y and implementation of the federal government's assistance programs have already been noted above. In addition, neither Elsa nor Faro were able to make use of the Manpower Consultative Services, as t h i s i s used primarily in situations of permanent closures. Few programs for dealing with periods of i n d e f i n i t e shutdown and community decline were available with the exception of the job creation program under Section 38 of the U.I. Act which was ammended in December 1982 (six months after the i n i t i a l shutdown) to permit projects that were mine (but not mine production) a f f i l i a t e d . The assistance programs developed by the federal government are, of necessity, intended to be applicable to a l l unemployed Canadians, and not only to unemployed miners. This means that the s o c i a l and economic d i s l o c a t i o n experienced in a northern dependent mining community is being addressed from the same perspective as i f i t occurred in Vancouver. While the problems facing such communities were acknowledged at the federal l e v e l , the fact remained that the Yukon mine shutdowns happened at a time when other mining operations as well as other sectors were also experiencing l a y - o f f s and requiring government assistance as well. In part, the lack of appropriate programs for distressed resource communities may stem from the dearth of information on 55 the v a r i o u s ways in which mine shutdowns and community d e c l i n e have been d e a l t with in the p a s t . C u r r e n t l y , no such 'inventory' e x i s t s and, t h e r e f o r e , l i t t l e i s known about the success of s t r a t e g i e s and programs i n reducing the s o c i a l and economic d i s l o c a t i o n c r e a t e d by a shutdown (Haugh, 1983). Few case s t u d i e s e x i s t , with most r e p o r t s of l o c a l hardships found in newspaper a r t i c l e s . F u r t h e r , while i t was proposed that a study be undertaken to determine the p u b l i c c o s t s r e s u l t i n g from a shutdown (E,M&R, 1981), such a study has not yet been conducted (Keyes, 1983). T h i s lack of e m p i r i c a l data g i v i n g s p e c i f i c i n f o r m a t i o n .on the nature, c o s t s , d u r a t i o n , and frequency of shutdowns l i m i t s the a p p r o p r i a t e n e s s and e f f e c t i v e n e s s of m i t i g a t i v e measures. 3.3.2 ^ C o n f l i c t Over Roles and R e s p o n s i b i l i t i e s In both Yukon s i t u a t i o n s , j u r i s d i c t i o n a l c o n f l i c t between i n v o l v e d p a r t i e s more o f t e n r e f l e c t e d power s t r u g g l e s over areas of c o n t r o l and r e s p o n s i b i l i t y than attempts to reduce the s o c i a l and economic d i s l o c a t i o n . For example, when i t came to n e g o t i a t i o n s between YTG and UKH over a c t u a l l y a s s i s t i n g , with the p r o v i s i o n of housing, n e i t h e r one would accept the r e s p o n s i b i l i t y , each arguing that the other bore the r e s p o n s i b i l i t y (Whitehorse S t a r , Aug. 1982). Another example was p r o v i d e d by the c o m p e t i t i o n between DIAND and YTG f o r c o n t r o l over s o c i a l and economic matters. According to the Yukon Act, YTG has l e g a l r e s p o n s i b i l i t y f o r s o c i a l and economic concerns, while the f e d e r a l government, 56 under the B r i t i s h North America Act, has j u r i s d i c t i o n over land, resources, and resource development in the northern T e r r i t o r i e s . In addition, the federal government, through other departments such as CEIC, provides most of the available s o c i a l and economic assistance programs for distressed communities. C o n f l i c t s arose over who should be providing assistance for Faro. Reasons for these c o n f l i c t s over the issue of r e s p o n s i b i l i t y stem from: •a dearth of regulatory measures which outline who is responsible for what. Such measures include labour l e g i s l a t i o n , C o l l e c t i v e Agreements, and joint agreements between government and industry. While certain corporate r e s p o n s i b i l i t i e s for mitigating the costs of an i n d u s t r i a l closure and therefore termination, have been l e g a l l y defined through labour l e g i s l a t i o n such as the Canada Labour Code, there is very l i t t l e attention given to the p o s s i b i l i t y of temporary and i n d e f i n i t e l a y - o f f s . C o l l e c t i v e Agreements, while more s p e c i f i c in ou t l i n i n g corporate r e s p o n s i b i l i t i e s for lay-o f f s and terminations, contain few provisions for their occurence, beyond n o t i f i c a t i o n and compensation. A recent Federal Commission of Inquiry into Redundancies and Layoffs forwarded three reasons for th i s (1979, pp.36,97): • u n t i l very recently, l a y - o f f s have not been perceived by the unions as a major problem; •government assistance in the form of Unemployment Insurance, manpower services and retraining programs have been viewed by 57 unions as providing adequate protection; and •employers have negotiated higher wage settlements along with other provisions in an attempt to maintain, their 'right to manage' which gives them the freedom to adjust their operations without recourse to employees, unions, or public a u t h o r i t i e s . More recently, agreements between a mining company and the federal government (in the case of mines north of 60°) have contained clauses which outline a s p e c i f i c n o t i f i c a t i o n period for a permanent closure in addition to determining the company's r e s p o n s i b i l i t i e s . The following section of the 1974 Nanasivik agreement i l l u s t r a t e s such requirements: Prior to the permanent closure of the mine due to the exhaustion of ore reserves the Company agrees to give at least twelve months notice of such closure, to the Minister. In the event of the permanent closure of the mine i t s h a l l be the r e s p o n s i b i l i t y of the Company: (a) to dispose of materials, equipment and buildings including housing, under i t s ownership or t i t l e , within a time period, and in a manner sati s f a c t o r y to the Minister and the Commissioner, (b) to submit to the appropriate government agencies plans and schedules for the abandonment, clean-up and restoration of the s i t e . The abandonment, clean-up and restoration s h a l l be undertaken in a manner s o c i a l l y , a e s t h e t i c a l l y and environmentally acceptable to the government agencies concerned. In the case of the • t a i l i n g s disposal system, the planning a c t i v i t i e s are to be undertaken before Stage 2 commences, (c) to pay relocation costs not otherwise reimbursable for employees and their dependents having to move due to impending or actual closure of the mine and (d) to r e t i r e f u l l y any outstanding portions of loans, outstanding user-charges and other debts payable to Her Majesty and chargeable to the project. As i s evident, l e g a l l y defined corporate r e s p o n s i b i l i t i e s , 58 such as those discussed above, are minimal, and pertain primarily to the obligations of the company to i t s employees in such matters as n o t i f i c a t i o n , severance pay, and relocation. Further, they pertain to the permanent closure of the mine with no mention of obligations should an i n d e f i n i t e and/or temporary shutdown occur. F i n a l l y , there is no reference made to the issue of r e s p o n s i b i l i t y for the community and i t s continued existence, due to an absence of e x p l i c i t p o l i c i e s by either the government or company as to r e s p o n s i b i l i t y for the mining community. While DIAND, for example, has played an important role in the development of new mining communities in the past, there i s l i t t l e p o l i c y guidance as to what to do with the community once the mine is shut down. Si m i l a r l y , there has been no c l e a r l y enunciated policy by a mining company regarding i t s r e s p o n s i b i l i t y for a community which has been established primarily to serve the company's needs. The reluctance by YTG, on the other hand, to give communities such as Elsa and Faro special attention i s due to the fact that many of i t s other communities also need assistance. For example, i t argues that Faro should not receive special treatment following the mine shutdown when Whitehorse, which was d i r e c t l y affected by the shutdown as well (due to the layof f s of those working in mine support services), would not (Heartwell, 1982). With no clear indication of respective r e s p o n s i b i l i t i e s in the two case studies, i t i s not surprising that each sector had d i f f e r i n g perceptions of i t s rights and r e s p o n s i b i l i t i e s , as 59 well as those of the other parties . For example, the general concensus that YTG expected CAMC to solve i t s own problems was supported in interviews with a l l parties (Byblow, 1982; Mi t c h e l l , 1982; Heartwell, 1982). The competition between DIAND and YTG over socio-economic comcerns has already been noted. A th i r d example i s provided by the USWA's expectation that either YTG or UKH would provide housing for USWA's members. 3 . 3 . 3 2 h. Lack Of Preparedness The UKH and CAMC shutdowns created a ' c r i s i s - s i t u a t i o n ' , not only in terms of their s o c i a l and economic repercussions, but also in the response c a p a b i l i t i e s at both t e r r i t o r i a l and community l e v e l s . With response c a p a b i l i t y already limited by the r e l a t i v e i s o l a t i o n and lack of opportunities for l o c a l employment and economic d i v e r s i f i c a t i o n , the lack of preparedness appears to have exacerbated the problems generated by the high degree of dependency on a v o l a t i l e mining industry. Without a pre-determined framework of responses out l i n i n g strategies, co-ordination of roles and available assistance programs to f a l l back on, the opportunities for e f f e c t i v e and appropriate responses were greatly reduced. As a consequence, p r i o r i t y seemed to be given to developing stop-gap measures such as make-work projects and government-industry f i n a n c i a l agreements that were intended to a s s i s t the T e r r i t o r y in 'hanging on' u n t i l such time that the mines resumed operations. Despite the problems which surrounded the unexpected 60 closure of the Clinton Creek mine in 19781 and the i n e v i t a b i l i t y that both Elsa and Faro w i l l experience similar problems in the future when the mines close permanently, i t appears that very l i t t l e is being done to prepare for future Yukon shutdowns or closures. With the exception of YTG's policy regarding the future development of single resource towns (with strong preference for the f l y - i n / f l y - o u t arrangement), no p o l i c i e s or guidelines appear to have been developed regarding preventative or mitigative measures for existing communities. This lack of action contrasts with the recognition by YTG of the need for "long term measures i f the Yukon i s to avoid the same problems, in the future. The Yukon economy, dependent as i t i s on a single industry sectory, has for too long been at the mercy of external forces. The current problems should be seen as an opportunity for both the federal and t e r r i t o r i a l governments to develop long- term economic plans designed to broaden and strengthen the Yukon's economic base "(YTG,1982,p.3). Obviously, t h i s would apply to the community l e v e l as well- Reasons for t h i s paucity of policy and planning measures for preparing both the communities and the T e r r i t o r y for possible mine shutdowns can be found, for the most part, in the attitudes and perceptions of those involved. From interviews, i t was learned that planning for mine shutdowns and closures was often perceived as being d i f f i c u l t , i f not impossible, to do, 1This mine closed eight years e a r l i e r than was expected by both the T e r r i t o r i a l and Federal governments. Their combined $4 m i l l i o n investment into the community was viewed as a write-off. In response, a socio-economic impact was undertaken (Lerches,1977) to, in part, determine possible measures open to the government for reducing the impact of closure. Unfortunately, these measures never materialized. 61 given the uncertainty over i t s occurence (Rudychuk, 1982). Others argued the need to manage a shutdown through such strategies as: c o n t r o l l i n g the extraction process as a means of reducing the p o s s i b i l i t y of shutdown and closure; economic d i v e r s i f i c a t i o n ; contractual agreements which establish a s p e c i f i c life-span of the operation as well as the establishment of a reserve fund to offset shutdown di s l o c a t i o n ; and f i n a l l y , l e g i s l a t i o n requiring s u f f i c i e n t advance n o t i f i c a t i o n of both (Heartwell, 1982; Byblow, 1982; Power, 1982). Such suggestions coincide with those provided in the l i t e r a t u r e , where suggested impact mitigation procedures include: advance notice, job- creation programs, economic d i v e r s i f i c a t i o n , mining community reserve funds, and portable pensions (Hegadoren, 1979; Molloy and Bradbury, 1983). These proposals offer innovative alternatives to the stop- gap measures which have been t y p i c a l l y developed following a shutdown announcement. However, on their own, they tend to be limited in systematically preparing a community for a mine shutdown. To be e f f e c t i v e , they should be incorporated into an o v e r a l l planning framework which outlines the roles and r e s p o n s i b i l i t i e s in each proposal. In addition, they need to be adjusted according to the p a r t i c u l a r circumstances of the community as well as to the uncertainty within shutdown. 3.4 - Summary These two case studies have provided examples of the problems created by a lack of community preparedness for a 62 possible mine shutdown. The ad hoc approach employed by involved parties in both communities appeared to generate additional problems to those d i r e c t l y created by the shutdowns, namely, unemployment and out-migration. For example, both communities experienced c o n f l i c t s between involved sectors, delays and confusion in the provision of assistance measures, not to mention a lack of appropriate short and long-term strategies for reducing the l e v e l of s o c i a l and economic d i s l o c a t i o n . It was learned from interviews that much of the reason for the lack of planning for shutdown lay in the uncertainty inherent.in the occurrence of shutdown as well ,as in how and who should be involved in preparing for i t . In order to a s s i s t communities such as Elsa and Faro to prepare for and, therefore, manage a shutdown, the following chapters focus on developing a preparedness planning framework. 63 CHAPTER FOUR A CONCEPTUAL FRAMEWORK OF PREPAREDNESS PLANNING From the two case studies as well as from a review of the l i t e r a t u r e , i t appears that mine shutdowns and closures are perceived as 'accidents' or at most, 'isolated incidents'. Such a view is refl e c t e d by the lack of planning as well as the lack of e x p l i c i t p o l i c i e s dealing with their occurrence. As was i l l u s t r a t e d in the previous chapter, there i s a concomittant view that planning for a shutdown and possible community decline is d i f f i c u l t , i f not impossible, given the uncertainty over i t s occurrence. However, planning for and under uncertainty is indeed possible as i s demonstrated by the approach used in natural disaster planning. Here, the planning process is undertaken to deal with natural disasters where uncertainty prevails not only regarding the occurence of, for example, a flood or tornado but also regarding the l e v e l and exact nature of the devastation i t causes. Underlying such planning i s the recognition that much of th i s devastation could be avoided or reduced through advance actions, and by approaching disasters not as 'isolated incidents' but as longer term development problems. Contending that planning i s as viable and necessary for the shutdown of a mine in a mining community as i t i s in disaster planning, t h i s chapter draws on the experiences in the disaster planning f i e l d in developing a conceptual framework for preparing for mine shutdowns. It begins with an examination of 64 disaster planning, followed by a discussion of what can be applied to planning for mine shutdowns, and f i n a l l y , offers a conceptual framework for preparedness planning. 4.1 ^ Natural Disaster Planning 4.1.1 2 D e f i n i t i o n Of A Natural Pisaster A natural disaster may be defined as the destructive s o c i a l consequences resulting from the occurrence of a natural phenomenon such as an earthquake, mudslide, flood and tornado. Its severity i s dependent upon two factors: •the c h a r a c t e r i s t i c s of the p a r t i c u l a r 'disaster' agent (e.g., suddeness, duration, and frequency, which are usually uncontrollable); and •the c r i s i s management c a p a b i l i t y of the affected community, region or country, which i s controllable (Wenger,1978; Brown,1979). The consequences of a disaster are experienced by society d i r e c t l y , i n d i r e c t l y , and cumulatively through loss and injury to l i f e and property as well as systemic disruption (Mileti,1975; Habitat,1983). For example, the 1970 Bangladesh cyclone k i l l e d a quarter of a m i l l i o n people, as many head of c a t t l e , and severly damaged crops as a result of associated flooding (Foster,1980,p.189). In the U.S., the estimated property damage caused by hurricanes on the A t l a n t i c Coast between 1915 and 1970 averaged $142 m i l l i o n annually (U.S. Off i c e of Emergency Preparedness, 1972). 65 Impacts are also experienced in loss of economic growth and development (Habitat,1983; Brown,1979). Some of the smaller and poorer countries, such as H a i t i , suffer damage as high as 15% of their GNP due to hurricanes (Habitat,1983). However, in most cases, i t i s impossible to calculate the loss of development momentum and of benefits from economic a c t i v i t y not realized as a result of a disaster. F i n a l l y , few disaster figures contain information on the resultant higher incidence of disease, loss of housing stock, unemployment, loss of population through out-migration, among others (Habitat,1983). There i s a similar dearth of information on the community impacts created by a mine shutdown. 4.1.2 ^ Pisaster Planning Concepts T r a d i t i o n a l l y , disasters have been viewed as 'accidents' and r e l i e f as the remedy (Brown,1979). Planning emphasis has primarily been on the provision of " r e l i e f , r e h a b i l i t a t i o n assistance, and reconstruction e f f o r t s " in an attempt to restore 'normalcy' as quickly as possible (Mileti,1975). This approach can be described as disaster s p e c i f i c as well as reactive in that attention i s t y p i c a l l y focussed on developing appropriate responses for a current disaster after i t has already struck. However, this 'reactive' approach i s characterized by numerous problems involving response delivery, co-ordination of involved agencies ( p a r t i c u l a r l y in international disasters, 66 where.numerous r e l i e f organizations are involved), inaccurate information concerning the needs of those affected, and the i n e f f i c i e n t use of f i n a n c i a l resources, to name but a few problems (Brown,1979). Within the past decade however, concern in the disaster f i e l d has broadened from disaster r e l i e f to embrace the concept of disaster planning. E s s e n t i a l l y , t h i s r e f l e c t s a growing awareness that disasters are no longer "is o l a t e d incidents but development problems requiring "planned, co-ordinated and long- term responses" (Brown,1979,p.101). This involves developing measures for disaster prevention and disaster preparedness based on "[a]n understanding of the causative factors of v u l n e r a b i l i t y , their analyses and evaluation, and their ( i . e . , factors) adjustment" (Habitat,1983,p.16). The goals of reducing the v u l n e r a b i l i t y to and losses from a disaster, as well as of being prepared for a disaster agent are central to disaster planning. In the l i t e r a t u r e , the former constitutes the framework for preventative planning while the l a t t e r for preparedness planning. Brown (1979,pp.32-34) provides the following d e f i n i t i o n s for each: [P r e v e n t a t i v e planning involves the formulation and implementation of long-range p o l i c i e s and programs to prevent or eliminate the occurence of disasters. On the basis of v u l n e r a b i l i t y analyses of a l l r i s k s , prevention includes land use, zoning, building construction regulations and settlement planning strategies. [P]reparedness planning, on the other hand, involves developing a readiness to cope with disaster situations which cannot be avoided. This involves warning the affected population, developing an operational plan of action and an organization to 67 manage and co-ordinate that action, the tra i n i n g of personnel in rescue and r e l i e f techniques, the stockpiling of supplies and the earmarking of funds for r e l i e f operations. 4.2 ^ The Rationale For Disaster Planning 4.2.1 ^ h. Increase In Pisasters The need for disaster planning stems from a marked increase in the number of disasters occurring in the world, and with t h i s , an increase in the extent of their destruction. While t h i s increase can be attributed to, in part, better reporting, the primary reasons appear to stem from: • rapid population growth in disaster prone areas. In the United States, for example, the two fastest growing states ( C a l i f o r n i a and Florida) are vulnerable to earthquakes and hurricanes respectively. Internationally, there i s a 'disaster path' which runs along the Mediterranean to the Middle East, Afghanistan, Pakistan, India, Bangladesh south to Indonesia and north to Japan (Brown,1979). These areas are subject to recurring earthquakes, cyclones and typhoons which are, for the most part, uncontrollable. At the same time, their population i s expected to increase by 50% between 1975 and 1990 (Brown,1979); •increasing urbanization in areas already vulnerable to natural di sasters. Greater concentration of people in urban areas i s seen to be a prime factor in the increasing number of deaths, as well as the extent of property losses. In fact, many of the disasters of the 1980s are viewed as 'megadisasters' as a result 68 of the enormous losses which they i n f l i c t . For example, as mentioned above, the Bangladesh cyclone k i l l e d an estimated 250,000 people while Hurricane Camille (1969) k i l l e d 256 people and caused over $1.4 b i l l i o n in property damage along the U.S. Atl a n t i c coast (U.S. Office of Emergency Preparedness, 1972, p.184) . 4.2.2 ^ A Lack Of Integrated E f f o r t s Settlement planning which ignores or does not incorporate an area's exposure to natural hazards only increases the vu l n e r a b i l i t y of that area to a disaster. Coupled with increased population growth and rapid urbanization, the probability of greater devastation i s encouraged. Obvious examples of inappropriate settlement planning can be found in the le v e l of development in flood plains, h i l l y areas which are prone to mud and rock s l i d e s (e.g., Lions Bay,B.C), and exposed coastal areas (e.g., C a l i f o r n i a ) . Inappropriate settlement planning is also evident during the reconstruction phase of disaster recovery when housing i s r e b u i l t in the same location. Recognition of disaster hazards in many countries developed and developing - tends not to be re f l e c t e d in national or subnational s o c i a l , economic or s p a t i a l planning and p o l i c i e s (Habitat, 1 983; Brown, 1979; Stott, 1 979).. E f f o r t s to reduce the degree of v u l n e r a b i l i t y to recurring disasters have often been fragmented and have not refl e c t e d a comprehensive approach to disaster reduction. Reasons for thi s stem from j u r i s d i c t i o n a l competition or 69 c o n f l i c t as well as the lack of an overa l l planning program which binds these d i f f e r e n t l e v e l s to a common goal. For example, i t has already been noted that many communities have no disaster plans which could reduce the l e v e l of devastation i n f l i c t e d by a disaster agent. At the same time, they may, through l o c a l zoning by-laws, encourage increased settlement in disaster-prone areas. While such communities are reluctant to reduce their v u l n e r a b i l i t y to disasters, they are, at the same time, relying on regional and national governments for assistance once disaster occurs (U.S. Office of Emergency Preparedness, 1972). Given the increase in the number of disasters in the past two to three decades, as well as a marked increase in the costs of public assistance, 1 such a lack of co-ordinated e f f o r t represents both an i n e f f i c i e n t and i n e f f e c t i v e use of f i n a n c i a l and administrative resources. 4.2.3 - Problems in Developing a Response Framework. While there i s growing awareness of the greater v u l n e r a b i l i t y to disasters, correspondingly, there i s increasing recognition of the problems surrounding the current disaster response framework. The following offers a brief summary of the 1For example, the number of major disasters declared in the U.S. between 1953 and 1973 jumped from 14 to 46: the estimated f i n a n c i a l assistance provided by the Federal Disaster Assistance Administration alone (one of nine federal agencies involved in disaster r e l i e f ) rose from $2 m i l l i o n in 1953 to $264 m i l l i o n in 1973 (Mileti,1976,p.41). 70 more common ones (sources include: Brown,1979; Foster,1980; Habitat,1983; and U.S. Office of Emergency Preparedness, 1972): •Prediction And Warning Systems. In many disasters, there was inadequate warning about the imminence of a disaster agent due to non-existent forecasting systems, or forecasting systems which had already been damaged by the disaster agent. In other situations, where a disaster agent had been monitored by tracking devices, there was no established warning system whereby the l o c a l population could be n o t i f i e d . Further, a lack of public education over disaster procedures has, in many countries, contributed to unncecessary i n j u r i e s and deaths. Recognition of the need for improved warning systems has resulted in the creation of numerous interorganizational programs to plan and develop such systems. For example, following the Bangladesh cyclone, the World Meteorological Organization (WMO) established a Tropical Cyclone Project which is responsible for "detecting and forecasting t r o p i c a l cyclones in the SouthEast Asia region, the organization of early warning systems, as well as other aspects of disaster preparedness and prevention" (Brown, 1979,p.37). •Organization. Brown(1979,p.25) notes that t y p i c a l l y problems in responses to a disaster occur in the areas of a), interorganizational co-ordination in matters of f i n a n c i a l , informational, and r e l i e f assistance operations where co- ordination has not been pre-determined. Consequences of this are 71 found in disagreement between involved groups over roles and r e s p o n s i b i l i t i e s , duplication of e f f o r t s in some areas and neglect of others; and b) policy co-ordination among the various levels of governments, among their respective agencies, among international r e l i e f agencies, and among a l l involved organizations. Some countries have now established permanent standing national disaster r e l i e f organizations to co-ordinate both public and private r e l i e f e f f o r t s as well as to promote the "study, prevention, control, and prediction of natural disasters" (Brown,1979,pp.15-17). •Disaster L e g i s l a t i o n . Generally, there i s a dearth of l e g i s l a t i o n establishing j u r i s d i c t i o n a l r e s p o n s i b i l i t i e s , authority, and co-operation in times of disaster. In many cases, ad hoc l e g i s l a t i o n was passed after disasters occurred and the accompanying confusion and trauma was experienced (U.S. Office of Emergency Preparedness, 1972, p.167). •Disaster Response Plan. A lack of established procedures, lines of authority, and r e l i e f measures, has often resulted in delays and confusion. In some cases, these have increased the severity of losses and ov e r a l l costs, while a f f e c t i n g the length of the recovery period. It appears that many communities which are vulnerable to natural disasters have yet to develop disaster plans, rendering them dependent and helpless should a disaster occur. In 72 response, the federal governments of Canada and the United States have developed a series of mechanisms (e.g., f i n a n c i a l incentives, administrative assistance etc.) which encourage lo c a l development of such plans. For example, a Joint Emergency Planning Program was created by the federal government through Emergency Planning Canada which, in consultation and co- operation with pr o v i n c i a l and t e r r i t o r i a l governments, undertakes and contributes to emergency planning projects which enhance the national emergency response c a p a b i l i t y . Approximately $6 m i l l l i o n per year is allocated for these projects (Federal-Provincial Relations O f f i c e , 1984, pp.290-91). 4.3 2. Summary Of Disaster Planning Discussion While i t i s unlikely that disasters w i l l ever be 'prevented' in the true sense of the word, i t i s possible to reduce both the l e v e l of destruction as well as the degree of disaster v u l n e r a b i l i t y through both preventative and preparedness disaster planning. As the preceding section has outlined, t h i s requires a commitment to developing a readiness at both national and community l e v e l s of organization. The integration of actions and e f f o r t s undertaken at these levels into an o v e r a l l disaster planning framework provides the basis for more e f f e c t i v e and comprehensive disaster management than that which i s offered by the disaster r e l i e f approach. 4.4 2. Implications For Planninq For Mine Shutdowns S i m i l a r i t i e s exist between a dependent mining community 73 which i s vulnerable to the shutdown of i t s sole employer and a community which is vulnerable to the occurrence of . a flood or earthquake. For example, a mine shutdown has the potential to create a socio-economic 'disaster' in much the same way that the occurrence of an earthquake may create a physical disaster for another community. In addition, both kinds of communities experience a great deal of uncertainty over jLf and when a 'disaster' agent might occur, as well as the extent of i t s impacts. However, one underlying difference in the type of 'disaster' that each one experiences l i e s in the degree to which the disaster could have been prevented. A natural phenomenon such as an earthquake cannot be prevented from occurring, whereas the decision to shut down or close a mine could be prevented through changes in the mineral markets or preventative actions such as employee takeovers or government intervention. Recognizing that a mine shutdown could be approached by a mining community in either of two ways - prevention of i t s occurrence or preparation for i t s occurrence - the thesis focusses on the l a t t e r , contending that i t i s by far the most e f f e c t i v e approach for systematically dealing with the possible loss of the community's economic mainstay. The previous discussion on disaster planning has provided an understanding of how i t i s possible to plan for the occurrence of a natural disaster and ultimately, control, to a large degree, the l e v e l of i t s destruction as well as i t s inherent uncertainty. What lessons can be drawn from the 74 disaster planning f i e l d which would a s s i s t in improving current approaches to mine shutdowns and closures? E s s e n t i a l l y , there are three. 4.4.1 2 The Need To Prepare In both the natural and economic 'disaster' situations, the ad hoc and reactive approach created by a lack of readiness has resulted in additional s o c i a l and economic d i s l o c a t i o n at l o c a l , regional, and national l e v e l s . Within the mining community context, the case studies and the l i t e r a t u r e indicate the need for a mining community to prepare for mine closures and shutdown. Certainly, i t i s at th i s l e v e l where the s o c i a l and economic consequences of either one are experienced most d i r e c t l y and immediately. Not surpris i n g l y , i t i s the way in which the shutdown or closure process takes place rather than i t s actual occurrence that creates the most problems (Robb Ogi l v i e , 1981; Fleming, 1978; Manpower Consultative Services,1982). Much of the way in which shutdown occurs depends on the attitude of the mining company. Dependency by a mining community on the 'good w i l l ' of the company r e f l e c t s the underlying precariousness and u n r e l i a b i l i t y of the t r a d i t i o n a l ad hoc approach to shutdown and closure. In some cases, the company exhibits a sense of s o c i a l r e s p o n s i b i l i t y , which i s r e f l e c t e d by adequate n o t i f i c a t i o n , consultation with the union and governments over the actual decision to shut down or mitigative measures, a policy of informing the community of developments in the shutdown, and adequate compensation to those 75 affected (Appendix 5 contains an example of t h i s type of sensitive approach developed by Selco in i t s closure of i t s South Bay operation in Ontario). On the other hand, there are many mining communities who do not exhibit a similar concern for reducing the 'trauma' of a shutdown/closure and who l i m i t their s o c i a l r e s p o n s i b i l i t i e s to those outlined in existing labour l e g i s l a t i o n and C o l l e c t i v e Agreements. As a r e s u l t , the shutdown process becomes adversarial in nature and characterized by c o n f l i c t s between involved sectors (Fleming,1978). Given these problems, i t is obvious that there i s a need for a community to prepare for the p o s s i b i l i t y of a mine shutdown and closure and to develop a systematic 'means' for managing the process and consequences of both. 4.4.2 2. Opportunities For Managing ' Di sasters' For a dependent mining community located on the resource ' f r o n t i e r ' , options are limited for avoiding the problems created by either a mine shutdown or i t s closure. However, from the discussion on disaster planning, i t was learned that while a community may not have the capac i t y for preventing the occurrence of a disaster, i t has the potential for managing and minimizing i t s consequences. Hence, through the a l l o c a t i o n of roles and r e s p o n s i b i l i t i e s as well as the development of appropriate strategies, the community has the opportunities to manage the process and consequences of a shutdown. Further, by assessing the circumstances of the community as well as 76 determining those impacts which are (a) t o t a l l y manageable (such as temporary unemployment in the case of mine shutdowns); (b) p a r t i a l l y .manageable or capable of being influenced (such as the retention of housing for residents during periods of shutdown); and (c) uncontrollable or unavoidable (for example, uncertainty over extensions of a shutdown), appropriate strategies, guidelines, and agreements can be developed for achieving such management (Robb Ogilvie, 1981). The process through which these measures are developed i s , e s s e n t i a l l y , planning, and involves the following steps: •goal or objective formulation/problem i d e n t i f i c a t i o n , •an analysis of the current s i t u a t i o n , along with opportunities and constraints, •the development of alt e r n a t i v e s , •an assessment of these alternatives according to which best f u l f i l l s the established goal/objective, •selection and implementation of t h i s a l t e r n a t i v e , •evaluation of the effectiveness of this alternative once i t has been implemented and feedback. This process is depicted in Figure 4.1. As w i l l be noted, th i s planning process i s both continuous and i t e r a t i v e . By this i s meant that through feedback loops, the process i s continously adapting to changes in l o c a l conditions, development of new preventative measures and so on. 4.4.3 ^ The Need For A Comprehensive Approach From the discussion on disaster planning as well as from FIGURE 4.1 - THE PLANNING PROCESS GOAL SETTING A PROBLEM IDENTIFICATION SITUATION ANALYSIS - present/future - internal/external - opportunities/ constraints GENERATION OF ALTERNATIVES ASSESSMENT OF ALTERNATIVES SELECTION & IMPLEMENTATION •EVALUATION 78 the analysis of the two case studies, i t appears that a general lack of co-ordination exists among and within various levels of organization in their e f f o r t s to manage 'disasters'. It i s clear that a fragmented approach i s both counterproductive and i n e f f i c i e n t . What is needed therefore, i s a more comprehensive approach which integrates p o l i c i e s and planning at the community1, regional and national l e v e l s . However, i t i s important that the planning undertaken at the community l e v e l be supported by i n s t i t u t i o n a l structures at the national or regional (e.g., t e r r i t o r i a l ) l e v e l s . For example, p o l i c i e s and regulatory measures at these levels should be developed in conjunction with 'disaster' response measures established at the community l e v e l in order to achieve greater effectiveness and ef f ic iency. 4.5 2. h. Conceptual Framework Of Preparedness Planning Drawing from these three lessons as well as the d e f i n i t i o n s of preventative and preparedness planning offered above, th i s thesis proposes a 'preparedness planning' approach to managing mine shutdowns. This concept of preparedness planning involves the development of both preparedness and preventative measures at the l o c a l , regional, and national le v e l s to reduce the l e v e l of d i s l o c a t i o n of, as well as the degree of v u l n e r a b i l i t y to, the loss of a resource community's economic mainstay. 1The community l e v e l includes a l l involved actors in a particular- community (e.g., mining company, union, workers, governments) as outlined in Chapter One. 79 Accordingly, there are three levels of organization involved in in actual preparedness planning: the national and t e r r i t o r i a l ('regional') levels which are concerned primarily with policy making, and the community l e v e l at which a preparedness framework and actual shutdown responses are developed. The following section outlines the ove r a l l conceptual framework of preparedness planning. It begins with a description of what i s involved at the community l e v e l , followed by an overview of the a c t i v i t i e s at the broader policy l e v e l s . 4 . 5 . 1 2 Community Preparedness Planning Level It i s at this l e v e l that planning i s undertaken in each community for the p o s s i b i l i t y of a mine shutdown and the eventuality of i t s closure. Such planning i s done before either occurs and i s most e f f e c t i v e when done by those most familiar with the p a r t i c u l a r community (e.g., mining company, union, government(s), residents, and private service sector). Due to the uncertainty as to the type and timing of shutdown as well as the general economic conditions at the time of shutdown, such planning must remain general, focussing on developing strategies for managing shutdown and on a l l o c a t i n g roles and r e s p o n s i b i l i t i e s for when i t occurs. S p e c i f i c a l l y , preparedness planning needs to focus on three areas: •strategies for responding to an actual shutdown or closure (that i s , detrmining who i s responsible for what when either occurs; •strategies to offset the resulting d i s l o c a t i o n when a shutdown 80 o c c u r s ( t h a t i s , w h a t p r o j e c t s c o u l d b e u n d e r t a k e n d u r i n g t h e s h u t d o w n p e r i o d ) ; • s t r a t e g i e s t o r e d u c e t h e l e v e l o f v u l n e r a b i l i t y t o f u t u r e s h u t d o w n s o r l o s s ( e i t h e r t e m p o r a r y o r p e r m a n e n t ) o f i t s e c o n o m i c m a i n s t a y ( f o r e x a m p l e , s t r a t e g i e s f o r r e d u c i n g c o m m u n i t y d e p e n d e n c y o n o n e . e m p l o y e r , i f v i a b l e ) . 4 . 5 . 2 ^ S h u t d o w n M a n a g e m e n t P l a n n i n g L e v e l W h i l e p r e p a r e d n e s s p l a n n i n g a t t h e c o m m u n i t y l e v e l f o c u s s e s o n d e v e l o p i n g a g e n e r a l f r a m e w o r k o f r e a d i n e s s f o r a s h u t d o w n , s h u t d o w n m a n a g e m e n t p l a n n i n g a t t h e c o m m u n i t y l e v e l i n v o l v e s s p e c i f i c r e s o u r c e p l a n n i n g a n d i s i n i t i a t e d o n c e a s h u t d o w n o r c l o s u r e h a s b e e n a n n o u n c e d . I t i s b a s e d o n t h e p r e - d e t e r m i n e d f r a m e w o r k e s t a b l i s h e d t h r o u g h t h e c o m m u n i t y p r e p a r e d n e s s p l a n n i n g p r o c e s s , b u t w i t h e m p h a s i s o n d e t e r m i n i n g w h a t s h o u l d b e d o n e a n d who s h o u l d d o i t g i v e n t h e p a r t i c u l a r n e e d s a n d c i r c u m s t a n c e s a t t h e t i m e . 4 . 5 . 3 2. T e r r i t o r i a l A n d N a t i o n a l P o l i c y P l a n n i n g L e v e l s E v e n t h e f e d e r a l g o v e r n m e n t ' s d i r e c t r e s p o n s i b i l i t y f o r r e s o u r c e d e v e l o p m e n t i n l a n d s n o r t h o f 6 0 1 , a l o n g w i t h t h e ' S p e c i f i c a l l y , w i t h i n D I A N D , t h e r e i s a N o r t h e r n R e s o u r c e s a n d E c o n o m i c P l a n n i n g B r a n c h w i t h a M i n i n g M a n a g e m e n t a n d I n f r a s t r u c t u r e D i r e c t o r a t e . T h i s D i r e c t o r a t e i s r e s p o n s i b l e f o r f o r m u l a t i n g p o l i c i e s , d r a f t i n g l e g i s l a t i o n a n d r e g u l a t i o n t o ' p r o m o t e o r d e r l y m a n a g e m e n t a n d d e v e l o p m e n t o f m i n e r a l r e s o u r c e s i n t h e Y u k o n a n d N W T ' . I n a d d i t i o n , i t i s a l s o r e s p o n s i b l e f o r a s s e s s i n g t h e t e c h n i c a l , e c o n o m i c , f i n a n c i a l , a n d s o c i a l e f f e c t s o f m i n e r a l p r o j e c t s ( D I A N D , 1 9 8 3 b , p . 1 2 6 ) . 81 t e r r i t o r i a l government's di r e c t r e s p o n s i b i l i t y for s o c i a l and economic concerns 1, there is considerable opportunity for both to develop appropiate p o l i c i e s for the problems created by mine shutdowns and closures. On consideration of their respective j u r i s d i c t i o n a l authorities as well as their respective administra'tive organizations, a c t i v i t i e s at each l e v e l should focus on developing p o l i c i e s which d i r e c t l y or i n d i r e c t l y require community preparedness planning. Such p o l i c i e s should be general in nature while, at the same time, providing f l e x i b i l i t y for each community to develop plans appropriate to i t s p a r t i c u l a r circumstances. Examples of these p o l i c i e s are provided in the following chapter. 4.6 2. Integration Of E f f o r t s Preparedness planning integrates a l l three lev e l s of planning as can be seen from i t s depiction in Table 4.1. The planning process - whether policy or preparedness - undertaken at each involves a series of steps which were outlined in Figure 4.1 above. This process should be both systematic and f l e x i b l e so that d i f f e r e n t government agencies and a l l mining communities could use i t : systematic, in that i t i s structured and consistent; f l e x i b l e , in that i t needs to address and r e f l e c t fThe Department of Economic Development and Intergovernmental Relations, and in p a r t i c u l a r , the Economic Research and Planning Branch, i s responsible for formulating policy alternatives for s o c i a l and economic issues a f f e c t i n g economic development in the T e r r i t o r y (DIAND,1983b,p.188). LEVEL PURPOSE COMPONENTS 'ACTION-FORMING MECHANISMS POLICY - to e s t a b l i s h a - stages o u t l i n e d i n PLANNING p o l i c y context planning process i n - l e g i s l a t i o n - n a t i o n a l / t e r r i t o r i a l . l e v e l , ( u n i v e r s a l a p p l i c a t i o n ) f o r community preparedness plann i n g Figure 4.1 - e s t a b l i s h e s the requirement t h a t a c t o r s develop preparedness p l a n s - r e g u l a t i o n s - i n c e n t i v e s - agreements F - u n c e r t a i n t y E PREPAREDNESS - community - stages i n F i g u r e - c o n t r a c t s E D PLANNING - community l e v e l p lanning f o r e v e n t u a l i t y of p a r t i c u l a r mine 4.1 - must i n c o r p o r a t e : l ) l o n g term o p t i o n s - agreements - p e r s u a s i o n c l o s u r e s & p o s s i b f o r a v o i d i n g l o s s - p l a n s B - ( s p e c i f i c a p p l i c a t i o n , i l i t y of mine shutdowns; of economic main- stay - networks A though genera L 2) shutdown manage- - flow c h a r t s i n n a t u r e ) , ment s t r a t e g i e s f o r n l e s s uncert- a v o i d i n g or reducing a i n t y but d i s l o c a t i o n & f o r K f u t u r e o r i e n t managing shutdown a t i o n . process SHUTDOWN - community - who should do what MANAGEMENT IMPLEMENTATION pl a n n i n a s p e c i f i c responses s p e c i f i c a l l y when shutdown/closure o - a c t i o n s PLANNING to p a r t i c u l a r occurs - community l e v e l -very s p e c i f i c immediate, shutdown or c l o s u r e once i t a c t u a l l y has been announced - same stages as i n Figure 4.1 f o r gener- a t i n g 'emergency response' a c t i o n s c e r t a i n t y 83 the p a r t i c u l a r circumstances, needs, and opportunities of each community and at each l e v e l of government. Its o v e r a l l structure is characterized by i t s i t e r a t i v e nature where 'feed-out' and 'feed-back' among these levels creates an on-going learning process which, ultimately, should result in a more comprehensive approach to mine shutdowns. As an example, a community could provide policy-makers with s p e c i f i c information regarding the effectiveness of certain p o l i c i e s in a s s i s t i n g in the management of shutdown impacts. As a re s u l t , uncertainty i s reduced as one moves from the policy l e v e l where ' p o s s i b i l i t i e s ' which contain a good deal of uncertainty as to place and time must be addressed, to the shutdown l e v e l where s p e c i f i c plans must be formulated for a known place and time. The future horizon addressed at each l e v e l is brought forward as one moves from the most general ( i . e . , policy) planning l e v e l to the most s p e c i f i c (response implementation) planning l e v e l . 4.7 Summary This chapter has developed a conceptual framework of preparedness planning for mine shutdowns in an attempt to create a more systematic approach to their management than i s offered by the ad hoc and reactive one. While the policy and management planning lev e l s are as important to the o v e r a l l effectiveness of the preparedness 84 planning approach as i s community preparedness planning, i t is the l a t t e r that the thesis i s primarily concerned with, and hence, i t i s that l e v e l which is the focus of the following, chapter. 85 CHAPTER FIVE PREPAREDNESS PLANNING AT THE COMMUNITY LEVEL Dependent communities such as Elsa and Faro, which are faced with uncertainty over the lif e - s p a n of their economic mainstay, and consequently, their own life - s p a n , have done l i t t l e planning to deal e f f e c t i v e l y with i t . T y p i c a l l y , t h i s uncertainty has tended to evoke a response of 'unable to plan' rather than a recognition of the need for a pa r t i c u l a r type of planning process. This has been r e f l e c t e d not only by a dearth of plans in response to actual shutdown (e.g., who and what should be involved in addressing the community needs following shutdown n o t i f i c a t i o n ) , but a d d i t i o n a l l y , by an absence of preparedness planning for the p o s s i b i l i t y of shutdown and the i n e v i t a b i l i t y of closure. It i s highly probable that Elsa and Faro w i l l once again experience the loss of their economic mainstay. Should neither community develop a readiness for t h i s loss, i t would seem l i k e l y that they w i l l experience a recurrence of those problems recently encountered: c o n f l i c t over roles and r e s p o n s i b i l i t i e s , and inadequate assistance measures. However, by undertaking a more systematic and planned approach to the p o s s i b i l i t y of such a loss, both communities would be able to reduce, to a large degree, the s o c i a l and economic d i s l o c a t i o n which i t creates as well as continued v u l n e r a b i l i t y to further losses (temporary or permanent) of their economic base. 86 The preparedness planning framework outlined in t h i s chapter provides communities such as Elsa and Faro with a basis for understanding not only of who and what should be involved in developing community readiness for the occurrence of shutdown and closure, but also what the requirements are for developing greater s e l f - s u f f i c i e n c y in the long run. Expanding on the preparedness planning framework outlined in the previous chapter, t h i s chapter begins with a description of each step in the actual planning process, followed by a discussion of who should be involved in the planning, and how. The chapter concludes with an overview of various mechanisms for implementing this process. 5 . 1 - Preparedness Planning: The Process 5 . 1 . 1 2 Goal Establishment/Problem I d e n t i f i c a t i o n A mining community undertaking preparedness planning should begin with a recognition of the strong p o s s i b i l i t y of future decline, given the i n e v i t a b i l i t y of mine closure as well as the p o s s i b i l i t y of i n d e f i n i t e and temporary shutdowns. In addition, goals regarding the future of the community should be established; that i s , does the community want to continue e x i s t i n g once the mine has closed. For company towns such as Elsa, continued existence may not be an option permitted by the mining company. However, other mining communities with municipal status, such as Faro, should determine whether continuation should be a goal. As well, the goal of minimizing the trauma which has t y p i c a l l y accompanied shutdowns in the past 87 should also be a r t i c u l a t e d . 5.1.2 - Situation Analysis Once a community has decided that i t s continued existence is desired, i t needs to determine the f e a s i b i l i t y of achieving t h i s goal. An analysis should be made of the opportunities and constraints for achieving such goals. A number of p o l i t i c a l , s o c i a l and economic variables need to be assessed, including location, community status, employment opportunities, economic d i v e r s i f i c a t i o n alternatives, housing a v a i l a b i l i t y , a v a i l a b i l i t y of assistance programs, general p o l i c i e s on n o t i f i c a t i o n , company p o l i c i e s , and strategies used by other mining communities. In addition, possible impacts - s o c i a l and economic, short- and long-term - for a l l three types of shutdown (and possible extensions) need to be determined. While such analysis provides the community with an inventory of information concerning available resources and problem areas when establishing strategies for o f f s e t t i n g periods of c y c l i c a l shutdown, the analysis i s also c r i t i c a l in determining whether continuation of the community is possible once the mine closes or whether i t i s highly improbable. It i s important, however, that these alternatives r e f l e c t the actual conditions and situation of the mining community, rather than wishful thinking. For example, opportunities for the economic d i v e r s i f i c a t i o n of Uranium City were dismissed by consultants commissioned by a l o c a l task force for fiv e major reasons (Wolfe, 1982, p.92): 88 •the time lag in getting a project going; •the limited market opportunity; • s o c i a l unacceptability of some of the proposals (for example, a detention center, a nuclear waste s i t e ) ; • l o c a t i o n a l disadvantages in terms of transportation costs; and, •few jobs would be created, or else jobs would not be created for a population not appropriately trained. 5.1.3 2. Generating Alternatives In the previous chapter, i t was noted that a. community should prepare for a shutdown in three ways: •strategies for avoiding the loss of an economic mainstay, i f possible; •strategies for o f f s e t t i n g periods of i n d e f i n i t e shutdown; and •a response framework for when shutdown does occur. Within each area, alternatives should be developed, i f possible. The purpose of generating alternatives for the three areas of preparedness i s to determine ahead of time the requirements for responding e f f e c t i v e l y to the p o s s i b i l i t y of a shutdown, and to minimize i t s community consequences. Four basic components should be re f l e c t e d within each a l t e r n a t i v e : •purpose, objectives, and p r i o r i t i e s ; •legal authority and allocated r e s p o n s i b i l i t y ; •organization and co-ordination of involved sectors and their r e s p o n s i b i l i t i e s ; and •available f i n a n c i a l and administrative resources. 89 Inherent in their development i s the determination of roles and r e s p o n s i b i l i t i e s . In addition, recognition that a 'staged response' may be needed must also be incorporated into these a l t e r n a t i v e s . This staged response refers to the uncertainty within temporary and i n d e f i n i t e shutdowns, which should be incorporated in each alternative in order to respond immediately to shutdown extensions or situations where a shutdown eventually becomes a closure. •Dependency-Reduction Alternatives These are e s s e n t i a l l y preventative strategies for avoiding dependency on one economic mainstay should the situation analyses in Step 2 indicate such opportunities e x i s t . Their development requires, f i r s t of a l l , consensus among involved pa r t i e s as to the continued existence of the community once the mine has closed permanently. This demands that thought be given not only to future economic opportunities, but more importantly, to the degree of future commitment to the community. While i t i s u n r e a l i s t i c to expect residents to commit themselves to l i v i n g in a mining community for ever, i t i s necessary to ensure that future government and resident commitments to the community are r e a l i s t i c . By t h i s i s meant that a government requires a certain l e v e l of population to warrant provision of services and f i n a n c i a l support; likewise, the residents need to know that such provisions would be made. Should there be a lack of interest in long-term residency 90 by the majority of the residents, and, more de c i s i v e l y , support by the government, attention should be directed toward developing a well-thought-out closure process. However, i f there appears to be s u f f i c i e n t support for developing the long-term v i a b i l i t y of the community, then planning should be undertaken to develop an alternate economic base. While i t i s beyond the scope of t h i s thesis to discuss in d e t a i l the conditions for economic d i v e r s i f i c a t i o n , several important variables which determine the potential for e f f e c t i v e economic d i v e r s i f i c a t i o n have been i d e n t i f i e d through the experiences of Atikokan, a former mining community in Ontario. These variables are: •lead time (from Atikokan's experience, i t takes from three to fiv e years to implement new industry, and between eight and ten years to locate an alternative economic base capable of sustaining 1,000 jobs); •designation of a party with e x p l i c i t r e s p o n s i b i l i t y for economic d i v e r s i f i c a t i o n (e.g., an economic development o f f i c e r or committee); •role of senior governments in terms of attitudes, programs, and support (that i s , would assistance be provided for such attempts?); and, •community resources and attitudes (e.g., demonstrated commitment and leadership) (Intergroup Consulting Economists Ltd., 1982, p.s-2). A l i s t of d i v e r s i f i c a t i o n opportunities proposed by the mining communities of Uranium City, Atikokan, and Thompson, is 91 contained in Appendix 6. • C y c l i c a l Shutdown Preparat ion Alternatives There is also a need to develop alternatives to offset periods of shutdown. For example, a stockpile of make-work projects could be created in advance which r e f l e c t s the needs of the community and which could be implemented on short notice. One such area involves environmental clean-up programs to r e h a b i l i t a t e some of the area destroyed by mine t a i l i n g s (Bradbury and Wolfe, 1983). A similar 'greening' program was i n i t i a t e d in Sudbury as a means of creating jobs during lay-offs (R. MacDonald, 1983). Such a stockpile would have been very useful for Faro during the period of i t s mine shutdown. The p o s s i b i l i t y exists that an i n s u f f i c i e n t number of projects could be created by repeated extensions of a shutdown, as was the case with Faro; however, this could be r e c t i f i e d by creating projects which are short-, medium-, and long-term in nature. •Closure Preparat ion Alternat ives These types of alternatives address ways of reducing s o c i a l and economic d i s l o c a t i o n , should either periodic shutdown or a permanent closure occur. For the most part, they should be concerned with generating f a i r and equitable agreements among involved actors, to minimize, unnecessary trauma. As an example, an agreement could be undertaken between the mining company and the community, ou t l i n i n g steps to be taken by the mining company in the event of a shutdown. 92 5.1.4 ^ Assessment And Selection Once i d e n t i f i e d , the options for each of the three areas of preparedness need to be assessed against (a) community goals and (b) opportunities and constraints. Those alternatives selected for preventing the loss of an economic mainstay, and for o f f s e t t i n g periods of temporary or i n d e f i n i t e shutdown, need to be implemented as soon as possible, to benefit from s u f f i c i e n t lead time. However, selection and implementation of shutdown management alternatives must obviously wait u n t i l a shutdown actually occurs, to determine which alternative is most appropriate for the p a r t i c u l a r circumstances at the time. 5.1.5 - Evaluation To determine the effectiveness of a selected alternative for each of the three areas of preparedness plans, an evaluation of i t should be undertaken after a shutdown or closure has occurred and the preparedness plan has been put into action through the shutdown management plan. Such evaluation i s useful for the community as well as others in ascertaining whether the strategies are viable and e f f e c t i v e . 5.1.6 2. Feedback Of absolute importance to the long-term success of the preparedness planning process is the need for feedback, both between and within each step. Ba s i c a l l y , t h i s requires a continual examination of the planning process and i t s res u l t s , and involves developing an i t e r a t i v e process whereby that which 93 is learned i s incorporated into future preparedness strategies and into adjusting, i f necessary, the planning process. 5.2 ^ Roles And R e s p o n s i b i l i t i e s Each of the involved actors in a mining community has a role to play in preparing for mine shutdowns, both s e c t o r a l l y (or, in the case of the residents, i n d i v i d u a l l y ) and c o l l e c t i v e l y , as involved participants in a mining community. To develop t h i s ' c o l l e c t i v e r e s p o n s i b i l i t y , ' a structure should be established for a l l o c a t i n g roles and r e s p o n s i b i l i t i e s with respect to the community needs and for undertaking preparedness planning. F i r s t , however,it i s necessary to determine what some of those r e s p o n s i b i l i t i e s might be for each sector, given their respective resources and j u r i s d i c t i o n s . While the actual r e s p o n s i b i l i t i e s of parties should be determined according to the p a r t i c u l a r circumstances of each community, the following section suggests some r e s p o n s i b i l i t i e s of these sectors for preparing for shutdown. 5.2.1 2 The Governments As mentioned e a r l i e r in the thesis, both the federal and t e r r i t o r i a l governments are involved in a mining community; with the federal government promoting and f a c i l i t a t i n g resource development projects in T e r r i t o r i a l lands, while the t e r r i t o r i a l government i s involved in their s o c i a l and economic development. E s s e n t i a l l y , both governments formulate p o l i c i e s and administer programs for these communities. For example, in Faro, YTG 94 provides educational services; while the federal government provides such health services as a nursing station. The governments are involved d i r e c t l y in the community through provision of these administrative services. Policy formulation, however, occurs at a geographic distance primarily in Whitehorse and Ottawa - and at a general l e v e l primarily at a regional and national policy l e v e l . Not surp r i s i n g l y , there is not the same direct contact between the community and policy-makers as there i s between the community and l o c a l government personnel involved in the provision of services. Hence, policy-makers in both governments may be more isolated from the s p e c i f i c needs of th i s type of community. While t h i s i s o l a t i o n reduces the a b i l i t y of the two levels of government to provide substantive input into community preparation for mine shutdowns, their respective j u r i s d i c t i o n s place them both in positions to ensure that a community preparedness planning process is implemented. The support of the national and t e r r i t o r i a l levels of government is of utmost importance to the success of the community preparedness planning e f f o r t . Various options for providing such support are discussed below in section 5.3. 5.2.2 2 The Mining Company T r a d i t i o n a l l y , i t has been the mining company which has been responsible for a mining community. However, increased involvement by governments in the creation, operation, and financing of these communities has changed the nature of the 95 role and r e s p o n s i b i l i t i e s of a mining company for i t s dependent commun i ty. While interviews with various mining company o f f i c i a l s revealed that r e s p o n s i b i l i t i e s of a mining company are f i r s t to i t s shareholders and workforce, and secondly, to the community and governments, i t has certain obligations for ensuring that a is prepared for shutdown. Given i t s knowledge of i t s f i n a n c i a l s i t u a t i o n , the trends in the international mineral markets, and the l i f e expectancy of the ore body, i t i s proposed that the mining company be involved in a s s i s t i n g community preparedness planning, in the following ways: •the company should give as much advance warning as possible of i t s intentions to either shut down or permanently close i t s operations. While i t has already been recommended that the period for n o t i f i c a t i o n be established through l e g i s l a t i o n of other formal measures, i t is forwarded that the mining company try to give even more time. It i s recognized that many companies may be constrained in doing so for several reasons. In the case of a shutdown, a l o c a l l y based mining community may not know u n t i l the l a s t moment, since the decision i s often made by the Board of Directors of i t s parent company (as was the situation in both case studies). However, while i t i s not known what a Board decides u n t i l i t acts, once decided, the Board should be required to give s u f f i c i e n t time for the community to prepare. Other problems include the p o s s i b i l i t i e s that disclosure of their plans might give an unfair advantage to their competitors; and f i n a l l y , that their workers might leave prior to the actual shutdown or closure. However, i t i s contended that such 96 n o t i f i c a t i o n is essential to developing s p e c i f i c responses to the actual occurrence of e i t h e r . •that the mining company, in addition to the terms contained in i t s C o l l e c t i v e Agreement, contribute to the costs of interim s t a b i l i t y programs or economic d i v e r s i f i c a t i o n planning through administrative and/or f i n a n c i a l assistance. This proposal is predicated on the fact that since the mining community was created to serve the interests of company, i t follows that the company 'pay i t s way out' by means of such assistance. In future, t h i s would mean that the costs of shutdown and closure would be incorporated into the o v e r a l l project costs, •the mining company should incorporate into i t s C o l l e c t i v e Agreement an outline of i t s r e s p o n s i b i l i t i e s regarding company housing, rental subsidies, and employment programs during periods of temporary and i n d e f i n i t e shutdown. Such provisions might have reduced the l e v e l of c o n f l i c t which was created following the shutdown at E l s a . While several mining companies have already incorporated some elements of planning into their agreements with their work force, any external imposition of such r e s p o n s i b i l i t i e s could be resented by the company. However, such requirements are intended to establish a mininum standard of r e s p o n s i b i l i t y rather than supplant a mining company's private i n i t i a t i v e s . 5.2.3 ^ The Union The union, through negotiations over i t s Agreement with the company, should attempt to Collect ive develop a 97 readiness for possible shutdown and closure in the following ways: • i t should i n i t i a t e discussions with the company over such issues as the above-mentioned housing and rental arrangements during periods of shutdown. • i t should be responsible, with support by the company and two lev e l s of government, for developing a stock-pile of make-work projects to be undertaken during periods of shutdown. 5.2.4 2 T n e Private Service Sector Since t h i s sector i s not involved with the actual mining operations, i t follows that they are usually the l a s t to be informed about a mining shutdown and/or closure. Hence, in developing a readiness for the possible occurrence of either, i t is suggested that the private sector, prior to establishing their business, be responsible for ascertaining through discussions with the mining company and involved government o f f i c i a l s , the expected life- s p a n of the mine, as well as the a v a i l a b i l i t y of company and government assistance in the event of a shutdown. Further, a l i a i s o n between the private service sector and the mining company should be established to keep abreast of developments in the mining operations, and with the government to encourage the development of possible assistance programs. 98 5.2 .5 ^ The Residents It has been noted that "the i n e v i t a b i l i t y of mine closure and shutdown i s often treated with complacency by the community and i t s residents i f things seem to be going well" (InterGroup Consulting Economists, 1982,p.2). The prime r e s p o n s i b i l i t y of the residents in preparing for possible shutdown i s to do just that - prepare both for the periods of possible and eventual unemployment, and for the eventual loss of community housing. Personal strategies such as savings and second home purchases provide some insurance for residents against the e f f e c t s of a shutdown. If economic d i v e r s i f i c a t i o n i s feasible, residents who wish to remain in the community once the mine has closed could i n i t i a t e community development projects, such as developing l o c a l t o u r i s t f a c i l i t i e s . 5.2.6 2 Organization Of Roles; The Intersectoral Committee Who should do the actual preparedness planning? Should i t be a single person or agency? Or should a l l parties be involved? It i s proposed that preparedness planning be undertaken by a l l parties involved in the community through an intersectoral committee comprised of representatives of each sector, and not merely the mining company, union, and governments. Such a suggestion is based on the rationale that an external agency or person may not be capable of addressing the concerns of a l l parties in developing a readiness. Further, and perhaps most importantly, by involving a l l parties in such planning, the f u l f i l l m e n t of their sectoral r e s p o n s i b i l t i e s i s more l i k e l y . 99 Since one of i t s functions i s to serve as a co-ordinating committee, emphasis must be on developing a consensus over suitable strategies for the community. Tr a d i t i o n a l sectoral disputes such as union/company disagreements should be dealt with in other arenas. 5.3 ^ Implementation Of The Preparedness Planning Process Successful implementation of the preparedness planning process depends upon the support, co-operation, and involvement of a l l p a r t i e s . The federal and t e r r i t o r i a l governments play a key role in implementation - obviously, a policy decision must be made by government to create the requirements for preparedness planning. It i s highly unlikey that leaving i t to be done on a voluntary basis w i l l result in a community readiness for shutdown. F i r s t of a l l , i t i s doubtful that a l l parties would feel responsible or concerned enough to undertake such planning; and second, even i f there were a strong interest shown in assuming the r e s p o n s i b i l i t y on a voluntary basis, i t i s highly improbable that such interest could sustain i t s e l f over a long period. This has been demonstrated repeatedly in natural disaster situations, where, once 'normalcy' returns, the interest in planning for possible disasters dies. What i s needed i s a more structured approach to implementation, including, for example, the development of formal measures such as l e g i s l a t i o n , regulations, or binding 100 agreements. Examples of l e g i s l a t i o n might include the o f f i c i a l designation of mining communities as 'special' communities or d i s t r i c t s which require the development of preparedness plans for the possible loss of an economic base. Regulations could include the establishment of planning and monitoring requirements for s o c i a l (community) aspects of a mining project, similar to requirements already established to deal with environmental concerns. This could be accomplished for new mining projects by establishing preparedness planning as a condition in required licences, permits and approvals; these requirements could be extended to existing projects as permits and approvals are renewed. Agreements similar to those used in the creation of new mining communities could be developed to ensure preparedness planning i s undertaken for the possible loss of the community's economic mainstay. For example, the agreement between the province of Manitoba and Sherritt-Gordon for the creation of Leaf Rapids allocated r e s p o n s i b i l i t i e s for the s o c i a l , economic and physical components of the community; however, i t did not address r e s p o n s i b i l i t i e s associated with shutdown. While formal measures are essential in ensuring that preparedness planning be undertaken, they may be viewed with a great deal of resentment and opposition by some of the involved parties and, in p a r t i c u l a r , the mining companies. Certainly, these measures would be viewed as an unwelcome intrusion in the companies' 'right to manage'. At the same time, given that the very need for preparedness planning stems from the fact that 101 many mining companies have not been as responsible as they might have in reducing the s o c i a l and economic d i s l o c a t i o n , i t remains that a certain amount of l e g i s l a t i o n i s required to ensure a minimum level of responsbility. The success of the preparedness planning process in developing a community readiness for shutdown w i l l be ensured only i f there i s a willingness on the part of a l l parties rather than a resentment over being forced to do so. With th i s in mind, another alt e r n a t i v e , e s s e n t i a l l y persuasive in nature, is the use of incentives or disincentives, usually f i n a n c i a l , to encourage sectors to f u l f i l l t h eir r e s p o n s i b i l i t i e s in developing community readiness. Such a 'carrot' approach might involve such incentives as subsidies, taxation gains or increases, and grants - a more posit i v e inducement than the imposition of formal measures. Further, t h i s persuasive approach could be more e f f e c t i v e in encouraging existing mining communities to undertake preparedness planning. While i t may be argued that such an approach i s co s t l y , both in terms of incentives paid out and revenues foregone, i t may likewise be argued that such costs are offset by the increased e f f i c i e n c y and effectiveness of shutdown management at the community l e v e l . While i t i s beyond the scope of t h i s thesis to ascertain which approach to preparedness planning implementation i s preferable, as the best a l t e r n a t i v e varies with l o c a l community conditions, the incentives approach, based on persuasion rather than formal measures, appears to be the more viable in 1 02 encouraging the undertaking of preparedness planning in existing communities. Although the incentives-based approach incorporates an element of choice, i t nonetheless encourages community-wide p a r t i c i p a t i o n . This provides the broad community support required for e f f e c t i v e preparedness planning. 1 03 CHAPTER SIX AN APPRAISAL OF THE PREPAREDNESS PLANNING APPROACH This thesis has outlined a preparedness planning framework which can be used by a dependent mining community to develop a readiness for the p o s s i b i l i t y of an i n d e f i n i t e or temporary mine shutdown and the i n e v i t a b i l i t y of a permanent one. Its purpose has been to provide the community with a 'means' for addressing and managing the s o c i a l and economic impacts which are created by the loss (temporary or permanent) of i t s economic mainstay and which could culminate in i t s decline. While preparedness planning does not necessarily prevent either a shutdown or closure from occurring, i t offers a more systematic approach to their occurrence than that which i s provided by the t r a d i t i o n a l ad hoc approach. As a way of summarizing the o v e r - a l l discussion of preparedness planning, an appraisal of i t s l i m i t a t i o n s and value i s offered. 6 . 1 2. Limitat ions While i t i s argued throughout the thesis that the preparedness planning approach w i l l reduce the problems created by the ad hoc approach to shutdown, i t would be u n r e a l i s t i c to imagine that i t i s without i t s own l i m i t a t i o n s . F i r s t , the preparedness planning approach requires that special consideration be given to the needs of resource communities such as mining towns. However, governments may be reluctant to give such p r e f e r e n t i a l treatment to th i s type of community p a r t i c u l a r l y when other non-resource communities may 1 04 be simultaneously and adversely affected. For example, Yukon government representatives questioned the equity of giving Faro special treatment at the same time while ignoring Whitehorse which was s i m i l a r l y affected. In response, i t may be argued that such consideration is necessary to offset unnecessary s o c i a l and economic costs and that perhaps Whitehorse should also undertake preparedness planning. This is p a r t i c u l a r l y important when a mine is the economic mainstay of the surrounding region. Secondly, there i s a very real p o s s i b i l i t y that the int e r s e c t o r a l committee which has the r e s p o n s i b i l i t y for preparedness planning may lose interest and momentum before a shutdown or closure has occurred. In many instances, several years may pass before either one might happen, creating a sense of complacency. Further, for those communities with no foreseeable long-term v i a b i l i t y , the rationale for preparedness planning might appear non-existent. However, i t i s precisely at these ' l u l l s ' that preparedness planing can be undertaken, for with s u f f i c i e n t time, appropriate short and long-term strategies should be developed. -Thirdly, while the implementation of the preparedness planning process could be l e g a l l y required in cases of new mining projects for which a new community must be constructed, similar requirements for existing communities may prove more problematic, even with s u f f i c i e n t incentives or disincentives. It is possible that some communities may not want to prepare, while in other situations, c o n f l i c t between involved parties may seriously undermine the effectiveness of the process. For 1 0 5 example, i t i s possible that the mining companies may seriously object to the imposition of a r e s p o n s i b i l i t y , believing that consultation between i t s e l f and i t s union i s s u f f i c i e n t . With t h i s in mind, i t is suggested that incentives and disincentives be developed in such a way as to address the s p e c i f i c needs of the community and i t s residents, thereby, of f e r i n g greater 'inducement' to prepare. F i n a l l y , the development of a preparedness planning approach within a void of c l e a r l y defined national and subnational ( t e r r i t o r i a l ) p o l i c i e s in the areas of community, regional, and resource development raises the question as to whether preparedness planning i s merely another 'band-aid' solution to the more complex and over-riding problems created by current resource investment p o l i c i e s and economic dependency. Further, the lack of clear p o l i c i e s in government departments such as DIAND which have a dual mandate of promoting and encouraging resource development on the one hand, while mitigating the s o c i a l and economic costs on the other, may serve to constrain those communities attempting to develop a readiness for the termination of such projects. What assistance they might provide to these communities results in f i r s t aid being offered to the victims of an economic disaster, while permitting the 'disaster' to continue to create victims. 6.2 - Value The value of the preparedness planning approach i s found primarily in procedural terms: that i s , preparedness planning as 106 a 'means' for addressing the many community problems associated with a shutdown and/or closure. F i r s t , i t helps to reduce the ' c r i s i s ' type of atmosphere which so often surrounds shutdown. It does this by promoting a readiness for i t through a more r a t i o n a l , organized, and systematic process. At the same time, i t provides an avenue for creative measures to be developed by those involved. For a dependent community, this serves as an opportunity to develop community reliance. Secondly, by assessing the e f f i c a c y of available assistance programs before-hand, problem areas and inadequacies are i d e n t i f i e d , as well as the type of assistance and programs needed in both the short and long-terms. This could lead to a more e f f i c i e n t use of administrative and f i n a n c i a l resources, a v i t a l concern during the current period of r e s t r a i n t . Third, preparedness planning provides a process for defining r e s p o n s i b i l i t i e s for a) the costs of shutdown which have t r a d i t i o n a l l y been assumed by the mining community and the public at large, and b) the planning for the needs of a dependent community faced with the loss of i t s economic mainstay. By involving a l l sectors of a mining community, a readiness can be developed which r e f l e c t s a wide spectrum of needs and not just those d i r e c t l y a f f i l i a t e d with the mining operation. Further, preparedness planning provides the necessary framework in which the true costs of a shutdown can be addressed 107 and from which informed trade-offs can be made between involved p a r t i e s . By involving a l l those parties who are affected by a shutdown, the process encourages the i d e n t i f i c a t i o n of a wider spectrum of needs, costs, and opportunities. F i n a l l y , preparedness planning may result in improved resource community planning through focussing attention on the need to prepare for the possible loss of an economic mainstay and for managing as well as reducing the uncertainty over and within the l i f e - s p a n of the community. The development of a more systematic and planned approach to shutdowns and closures could result in p o l i c y changes, i n i t i a t e d at senior l e v e l s of government, regarding the type of resource community b u i l t in the future as well as greater support for e x i s t i n g communities wishing to d i v e r s i f y their economic base. However, for such policy changes to take place, planning for shutdown must become an integral component of the resource community planning process in the same way that planning for resource community creation and maturation already i s . 1 08 REFERENCES Bazowski,David. Personnel Manager, CAMC,Faro. Interviewed in Faro, September 29, 1983. Berg,Ronnie. 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Paper No.1, July 1982. 114 LIST OF APPENDICES APPENDIX 1 - LIST OF INTERVIEWS APPENDIX 2 - PROVISIONS IN COLLECTIVE AGREEMENTS FOR MINE SHUTDOWNS AND CLOSURES APPENDIX 3 - UKH LAY-OFF NOTIFICATION APPENDIX 4 - NOTIFICATION OF THIRD SHUTDOWN EXTENSION: CAMC APPENDIX 5 - PLANNING A MINE CLOSURE: SELCO APPENDIX 6 - EXAMPLES OF ECONOMIC DIVERSIFICATION OPPORTUNITIES 115 APPENDIX 1 - LIST OF INTERVIEWS WHITEHORSE Barrie Brickman - Senior Advisor, DIAND (Northern Development) Maurice Byblow - MLA, Faro Peter Fairman - Planner, YTG (Economic Review & Planning Unit) Dave Gairns - Local Government Advisor, YTG (Municipal A f f a i r s ) C o l i n Heartwell - Director, YTG (Economic Review & Planning Unit) George Lerches - Regional Manager, DREE Piers MacDonald - MLA, Elsa and Mayo Cam Ogilvie - Assistant Director, DIAND (Non-renewable Resources) Judy Pearson - Manager, CEIC (Employment Development Branch) Barrie Robb - Manager, Yukon Housing Corporation B i l l Rudychuk - Yukon Representative, USWA David Waugh - Manager, Yukon Chamber of Mines ELSA AND MAYO Konnie Berg - Personnel Manager, UKH Dr. Clark - Doctor, Mayo Sue Davies - Social Worker, Mayo and Elsa Tom Dickson - Mine Manager, UKH Heiko Franke - President, USWA Local #924 Nelson Ireland - P r i n c i p a l , Mayo Graham MacDonald - Acting President, USWA Local #924 Ralph Mease - Miner, UKH FARO Eleanor Carrington - Housewife John Carrington - Mine Manager, CAMC June Hampton - Businesswoman Rennie M i t c h e l l - Mayor Dave Power - President, USWA #1051 Mike Rawlings - Former employee, CAMC 116 (FARO cont'd) Jeanne Wilson - Teacher George Wight - Chief Accountant, CAMC OTTAWA Robert Keyes - Director, Energy, Mines and Resources (Human A f f a i r s Division) Joseph Lazarovich - Acting Director, DIAND ( Mining Management & Infrastructure Directorate) Robert Shanks - Director, E,M &R (Resources & Development Division) Roger Simard - Project Manager, DIAND (Northern Program Planning) VANCOUVER O.W Fox - Industrial Relations Superintendent, AMAX of Canada Limited A.J. Petrina - Senior Vice-President, Placer Development (Operations) Peter Womersley - Manager, Placer Development (Employee Development and Compensation) 117 APPENDIX 2 - PROVISIONS IN COLLECTIVE AGREEMENTS FOR MINE SHUTDOWNS AND CLOSURES 1. UKH 6.09 Lay-offs a) Whenever a reduction of the work force is necessary the Company shall give the employees concerned two weeks notice or 80 hours pay at their applicable basic rate in lieu of such notice except in the case of temporary reductions due to breakdown, accident or other emergencies making the giving of such notice impossible. b) Where, as a result of a temporary reduction as referred to in 6.09 (a) an employee is unable to work for a minimum of five (5) days in a fourteen (14) day period, he shall receive the sum of Five Hundred Dollars ($500.00). If. following receipt of the above sum, the employee is or elects to be laid off, he shall not then be entitled to the notice and pay-in-Lieu provisions of 6.09 (a). This shall be the only situation in which an employee can elect to be laid off. An employee not laid off, but unable to work, shall receive room and board or housing at the regular rates. 6.11 Permanent Shut-down a) The Company shall give to the employees concerned, with a copy to the Union, at least three (3) months written notice of a planned permanent shutdown of all Company operations in the Elsa-Keno area. Yukon Territory, that will result in termination of employees by the Company. b) An employee who remains working at his assigned position until terminated by the Company will qualify for payment of severance pay of One Hundred Dollars ($100.00) for each completed three-month period of employment, calculated from his most recent date of employment if: (i) h e has remained continuously on the payroll of the Company since the date the notice referred to in (a) above was given until his release by the Company, (ii) h e has been continuously in the employ of the Company for six (6) calendar months prior to his release by the Company. c) Relocation assistance will also be provided to an employee who remains working at his assigned position until terminated by the Company, providing he actually moves out of the Keno, Elsa, Mayo area. An employee who terminated his employment or who is discharged for just cause following notice of the planned permanent shut-down referred to in (a) above, but prior to completion of his assignment will not qualify for any location assistance. Where husband and wife are both employed by the Company, only one employee is entitled to receive relocation assis- tance. If relocation assistance is provided in whole or in part by any Governmental Agency and/or another employer, the Company will only be obliged to make up any shortfalls to the maximum stipulated in the relocation assistance programs. d) Relocation assistance will apply to the destination chosen, but not beyond Vancouver or Edmonton, as follows: (i) One way economy air fare for the employee and for the- spouse and children if resident in the Mayo-Keno-Elsa area. (ii) After written quotations have received Company approval, the Company will provide the cost for the services listed below: 1. Packing and transporting of house- hold goods. 2. Transporting of boats and snow- mobiles within reason. 3. In-transit insurance. 4. Bunkhouse items. (iii) An employee who does not otherwise qualify for incoming transportation refund pursuant to Article 17.01 or 17.02 but who qualifies for relocation assistance will be deemed to qualify for refund pursuant to Article 17.01. e) The Company and the Union agree to establish a Manpower Consultative Services Committee under the auspices of Canada Man- power. The Committee will be established and become functional upon notice from the Company to the Union that shut-down of operations would take place. Such notice to the Union would be given and the Committee would become functional no later than the issuance of the Company's notice to employees referred to in (a) above. The prime function of this tripartite Committee will be to assist employees in securing alternate employment at the time their employ- ment is terminated in Elsa. 8.11 Permanent Shu tdown 1) In the c a s e of a permanent layoff or shutdown of the C o m p a n y ' s operat ions result ing in the terminat ion of an employee 's employment , the C o m p a n y wil l g ive: (a) Two (2) w e e k s not ice In writ ing to the emp loyee if h is per iod of employment is l ess than o n e ( 1 ) year , (b) O n e (1) month 's not ice in writ ing to the employee if h is per iod of employment is o n e (1) year or more but less than two (2) years ; (c) Two (2) months not ice In writ ing to the employee If his per iod of employment is two (2) years or more but less than five (5) years : (d) Four (4) months not ice in writ ing to the employee if his per iod of employment is five (5) years or more , but less than ten (10) years ; a n d (e) Six (6) months not ice in writ ing to the employee if his per iod of employment is ten (10) years or more . 2) W h e r e the not ice referred to in S u b s e c t i o n (1) has been g iven : (a) no employer shal l alter the rates or w a g e s or any other term or cond i t ion of employment of any employee to w h o m not ice has b e e n g iven ; a n d (b) upon expiry of the not ice , the employer sha l l pay to the person , the w a g e s and any unpa id hol iday pay to w h i c h he is entit led. 3) Notwithstanding S u b s e c t i o n (1 ) , the employment of an employee may be terminated forthwith w h e r e the employer g ives to the pe rson not ice in writ ing to that effect, and , (a) pays to the pe rson an amount e q u a l to the w a g e s to w h i c h the employee w o u l d have b e e n entit led for work that w o u l d have b e e n per formed by h im at the regular rate for a normal non-overt ime work w e e k for the per iod of not ice as above in S u b s e c t i o n ( 1 ) , a n d . (b) pays to the emp loyee any unpa id annua l hol iday pay to w h i c h the emp loyee is entit led under this A g r e e - ment. 4) The C o m p a n y a g r e e s to prov ide t ransportat ion for the emp loyee and his family and al l househo ld g o o d s to a dest inat ion of their c h o i c e but in no event beyond E d m o n - ton or Vancouver . In the event any government agency prov ides the above ass is tance , the government wil l b e the first payer with the C o m p a n y provid ing any remaining amount . 119 APPENDIX 3 ~ UKH LAY-OFF NOTIFICATION UNITED KENO HILL MINES LIMITED El»». Y u k o n Y O B V J O June 30 1932 United Steelworkers of America Local 924 ELSA, Yukon T e r r i t o r y Attention: Mr. H. Franke, President Dear Mr. Franke: 1. Laid-off married status employees occupying a Company residence (not residing i n a bunkhouse) may continue to occupy their residences, rent free, u n t i l August 31 1982 at which time they w i l l be required to vacate. 2. Laid-off employees residing i n a bunkhouse may occupy their accommodation up to and including July 20 1982, following which they w i l l be required to vacate. 3. Laid-off employees entitled to board and lodging may r e t a i n cookhouse pr i v i l e g e s July 14, 15 and 16 1982. Purchase of meal t i c k e t s w i l l be necessary thereafter. 4. Laid-off employees may continue to use the f a c i l i t i e s of the Elsa Market to make reasonable purchases for themselves and their dependants only. 5. Laid-off employees who were absent from the area on authorized holiday or leave during normal notice period, w i l l receive 80 hours pay i n l i e u of notice. Re: Lay-Off - General Conditions 7. The Company agrees to supply bus transportation to l a i d - o f f employees to Whitehorse between July 14 and July 16 1982. APPENDIX 4 - NOTIFICATION OF THIRD SHUTDOWN EXTENSION: CAMC T e x t of A n v i l Jvstatemei i t , . : This is the text of the announcment from the Cyprus Anvil Mining Corpora- . Hon extending the mine shutdown- in F a r o : " ' ^ r • 'r:.~: " - ' ^ ' ' •:--w--„,-.â i..-.o;s;.yv;â  -a'ats.- yj^^i^s:::^.^. Cyprus Anvil" Mining Corporation an- nounced today it will extend the- current mine shutdown period of the-company's zinc-lead-silver mine in Faro until spring, .1983. .:{^p^p[^^-Jr;~ ••:)-/• The decision comes after several mon- ths of efforts by, company- officials to achieve significant productivity gains and a reduction of power rates*., transportation and infrastructure costs in response to adverse economic conditions, i' - The company plans to continue con- sulting with the federal and Yukon govern- ments and other parties to resolve these problems and facilitate the. mine-reopen- .ing.y. !,->K —*«•»• ' v - • r»-:ti?--"c - Through the winter months a number of Cyprus Anvil employees will continue to be employed on various mine projects. - T h e s e employees, as well as laid-off employees.- * living - in- subsidized,- - self- contained units in Faro, will be permitted to-remain in their company housing under the existing housing program. This pro- grant includes subsidies lor rental, home heating., electrical power- and major maintenance w o r | C ^ ' ^ % 2 j ^ ^ ^ - . . . . . . . i j ' ^ "The company will also keep the: town's recreation centre functioning. ~: S , These measures will result in a:cost to the company of approximately $1' million per month through the winter; '• ^ ' Discussions will; be h e l d r with the federal and Yukon governments and the unions to establish new empJoyirtent pro- jects, adult eduction programs and other social activities this winter, to help maintain the quality of life in the town:-- SOURCE: The Whitehorse S t a r , September 8, 1982, p.3. KVELCPrfNT /WD /flMfL CF CLOSURE PUW 1978 LCMYJN DOATO TOWTO, H.Q. S.B. MWGEMENT S.B. fOUR.Y RATED S.B. FMILIES/RESIDENTS PROVINCIAL GOYEIWCNT FBXRA. GOVEPNMENT OTHER (QIET1C0 CENTRE) EXPLCHATORY PRELIMINARY, DISCUSSION OF CLOSURE PRELIMINARY DWT_ CDMCEPTS PLAN i T DISCUSSIONS OF CLOSURE PLANNING OJMCEPTS IWUTON PAR/METERS H>Ut ON PARAMETERS 1979 REVIEWEDL WRDYED REVIEWED APPROVED I DETAILED CLOSURE PLAN I I DISCUSSIONS 19U0 1981 APPROVLD PEVISED FINAL mmm PLAN AS DATED DISTRUSTED REqUIRLTJ OUTPUT TO QUEBEC CEN11C ( The following provides an outline of the process developed by Selco for the closure of i t s South Bay mine.) 124 APPENDIX 6 - EXAMPLES OF ECONOMIC DIVERSIFICATION OPPORTUNITIES ILLUSTRATIVE LIST OF THE TYPES OF "DIVERSIFICATION OPPORTUNITIES CONSIDERED IN THREE CASE STUDIES Type o f O p p o r t u n i t y Example Case y S t u d i e s where c o n s i d e r e d I . RESOURCE-BASED M i n i n g / M i l l i n g Tour ism and R e c r e a t i o n A g r i c u l t u r e Hydro G e n e r a t i o n m i n i n g new d e p o s i t s m i l l i n g f o r o t h e r nearby mines e x p l o r a t i o n f o r new p r o s p e c t s use o f mine waste products p r o v i n c i a l o r n a t i o n a l park o r landmark f i s h i n g o r h u n t i n g promotion t o u r i s m p r o m o t i o n a l program develop and expand campgrounds, parks and r e c r e a t i o n f a c i l i t i e s and t o u r i s t access to the r e g i o n greenhouse p r o d u c t i o n w i l d r i c e f u r farming game farming c a t t l e p r o d u c t i o n peat p r o d u c t i o n g e n e r a t i n g s t a t i o n t r a n s m i s s i o n system U U U U U T T U U U U U U T U A A A A A A T A - ' L e g e n d : U = Uranium C i t y , A = A t i k o k a n , T = Thompson. SOURCE: InterGroup Consulting Economists Ltd.(1982). 125 Type o f O p p o r t u n i t y Example Case S t u d i e s where c o n s i d e r e d F i s h e r i e s and F i s h P r o c e s s i n g F o r e s t r y f i s h i n g f i s h p r o c e s s i n g f i s h farming s a w m i l l o p e r a t i o n wood f o r energy secondary wood products U U T T A A A I I . GOVERNMENT AND REGIONAL BUSINESS F e d e r a l Government P r o v i n c i a l / L o c a l Government mine c l e a n - u p and r e c l a m a t i o n r e g i o n a l n a t i v e p e o p l e s ' c e n t r e mine t r a i n i n g c e n t r e n o r t h e r n t r a i n i n g school m i l i t a r y a c t i v i t i e s c o r r e c t i o n a l i n s t i t u t i o n weather s t a t i o n expand l o c a l r a d i o and t e l e v i s i o n p r o d u c t i o n c a p a b i l i t y community c o l l e g e c o r r e c t i o n a l i n s t i t u t i o n i n d u s t r i a l park development mine t r a i n i n g school shopping mal l and general purpose b u i l d i n g development r e g i o n a l h i g h school s p e c i a l h e a l t h care f a c i l i t i e s n u r s e s ' t r a i n i n g f a c i l i t i e s expanding and upgrading roads community improvement program ( l i b r a r y , a r e n a , c u r l i n g r i n k , a i r p o r t , m u n i c i p a l campground) e s t a b l i s h i n g o u t r e a c h p o s t - secondary e d u c a t i o n programs U U U U U T U U U U U U U T A T A A T A 126 Type o f O p p o r t u n i t y Example Case S t u d i e s where c o n s i d e r e d l o c a l s u p p l y o f s e r v i c e s to the r e g i o n , w h i c h are p r e s e n t l y s u p p l i e d by o f f i c e s i n a d i s t a n t m e t r o p o l i t a n c e n t r e ( p o s t - s e c o n d a r y e d u c a t i o n , c o u r t s e r v i c e s ) e s t a b l i s h i n g c h i l d care c e n t r e f o r e m o t i o n a l l y d i s t u r b e d c h i l d r e n r e - l o c a t i o n o f r e g i o n a l government o f f i c e s T A T A R e g i o n a l B u s i n e s s l o c a l b u s i n e s s e s s u p p l y s e r v i c e s to the r e g i o n which are p r e s e n t l y s u p p l i e d by b u s i n e s s e s i n a d i s t a n t m e t r o p o l i t a n c e n t r e ( c l o t h i n g , c a t a l o g u e s a l e s , food w h o l e s a l e r s , l e g a l s e r v i c e s ) r e g i o n a l e x p a n s i o n o f l o c a l b u s i n e s s s e r v i c e a r e a T A T I I I . RESIDENTIAL CENTRE - commuter r o t a t i o n systems - s e n i o r c i t i z e n s home T A T A I V . FOOTLOOSE INDUSTRIES Secondary - c o t t a g e i n d u s t r i e s , h a n d i c r a f t s , M a n u f a c t u r i n g a r t p r i n t s , j e w e l l e r y , c e r a m i c s U A - t a n n i n g and p r o c e s s i n g U - t e x t i l e m a n u f a c t u r i n g T - f u r n i t u r e and secondary wood p r o d u c t s A - o u t f i t t e r s and outdoor r e c r e a t i o n s u p p l i e s A Hazardous Waste and - r a d i o a c t i v e waste f a c i l i t y U A M a t e r i a l s D i s p o s a l - i n d u s t r i a l waste f a c i l i t y U Power P l a n t - thermal power p l a n t A

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