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The Resilient City
Appendix 1: Case Study Summaries
Northern Canada
Faro
Remotely located far northeast of Whitehorse, Faro is one of only 8 municipalities in the Yukon. Created to provide a workforce for mining, Faro was once the Yukon's economic powerhouse, producing 10% of the world's zinc and 12-15% of the Yukon's GDP. Suffering from a series of mine closures and re-openings under new ownership beginning in 1981, the final crisis came in 1998 when the Anvil Range lead-zinc mine suddenly closed and went into receivership.
With the closure, half of the town's workforce lost their jobs, related industries suffered, and the population fell from about 925 to just 250 by 2000. The town faced a disappearing livelihood, a crumbling tax base and a much smaller population. However, the severity of the crisis was reduced because of the territorial government's significant financial support, and its efforts to ensure generous worker severance and retraining packages and preserve mining assets. As well, a strong local government has used its community plan and a vibrant volunteer spirit to aggressively promote economic diversification.
Unlike most other Yukon communities that are shrinking in a difficult economy, Faro has rebounded since the mine closure because of modest economic diversification in service, tourism and home-based jobs. The population grew to 380 by 2002. Improving social conditions, well developed infrastructure and enthusiastic volunteer participation in community development are positive attributes that will help Faro in the future. While fewer health, social and financial services, and a smaller school-aged population are challenges to be overcome. Perhaps the greatest challenge lies in finding $50-200 million for the mine's environmental reclamation but, once obtained, these funds will provide many jobs for several years.
Inuvik
Incorporated as the first planned community north of the Arctic Circle, Inuvik lies at the end of the Dempster Highway near the Beaufort Sea coastline. Since 1954, the town has served as the region's administrative centre. Inuvik had no single crisis, but its economy lurched in fits and starts, along with the oil industry's interest in developing regional oil and gas fields and the Mackenzie Valley pipeline, for more than 25 years. Despite these economic shifts, Inuvik's population maintained slow growth and is now 3,000, only slightly below its 1976 peak.
As a regional administrative centre, with half of all jobs in the public sector, Inuvik has been less sensitive to industry shutdowns than other remote communities – downturns do not seem to have thrown the community into crisis. The local government, pioneering Aboriginal governments and business corporations have actively diversified the economy and created a blueprint for successful economic partnerships between local peoples and industry in the NWT. The town's remoteness and severe climate already require it to be self-sufficient in providing many goods and services, ensuring a robust economic base, strong infrastructure and good social, education and health services.
Inuvik will never entirely overcome its remote location, harsh climate, fragile environment and high cost of infrastructure that combine increase industry costs and hinder year-round transportation and access to markets. However, Inuvik has the capacity needed to maintain a stable and successful transition as the oil and gas industry continues to fluctuate.
Western Canada
Grande Cache
Located on an isolated mountain plateau in northwestern Alberta, Grande Cache's economy has always depended heavily on the coal industry. Following downsizing of mining operations in 1982, the Smoky River Coal Mine closed in 2000, employment in mining dropped from 28.5% in 1996 to 8.4% in 2001
The mine closure had a significant impact on Grande Cache, although the mine accounted for less than 30% of all local jobs. The population dropped from 4,441 to 3,828 between 1996 and 2001, about 13.4%. Most people leaving the town had young families. Housing starts decreased and employment in all sectors except transportation and utilities declined. Average incomes declined 6.5% and the unemployment rate became 12.3% compared to Alberta's overall rate of 5.2%.
The community benefited from decisive local and provincial government actions to support workers, existing opportunities to expand activities in forestry, corrections and tourism, as well as stable property tax revenues combined to ensure that Grande Cache has been able to stabilize and recover. As well, Grande Cache expects to benefit from expanding oil and gas exploration in the region and the tentative re-opening of the coal mine under new ownership. However, it must also address setbacks such as the recent layoff of most of the 125 Weyerhauser mill workers because of the softwood lumber dispute.
Granisle
Granisle is a small, remote community in northern British Columbia. It was incorporated in 1971 to house miners working at a pair of Noranda copper mines. The mines operated successfully for about a decade but low copper prices in the early 1980's caused a significant scaling-back in mine production. The mines were operated erratically until 1992 when closed permanently. Thus, Granisle experienced about a decade of economic turmoil, downsizing and uncertainty.
Consequently, between 1982 and 1985 the town's population plummeted. From a peak nearing 1600 persons, the population fell to under 600 by 1985. After a brief recovery in the late 1980's, the permanent closure of the mine resulted in a further population decline: to just over 500 persons in 1993 and falling to the ±400 range in 1996. This is perhaps a quarter of the peak population in the town. The demographics of the town have also changed, switching from a younger age structure when mining dominated the economy to an older age structure today. The town's civic government continues to function despite the challenges of the past years.
The transition challenge for Granisle was severe. After about a decade of uncertainty, the town's original raison d'être, to serve as a mining service centre, was entirely eliminated. Attempts to diversify have not been aided by the town's northern locale and remoteness -- 1.5 hours distant from Smithers (itself less than 6000 population).
Logan Lake
Logan lake is a small community in southern interior, close to Kamloops (BC's 12th largest city) and within easy reach of the large commercial centres in the Fraser Valley and the Okanagan. The region's economy has long been influenced by copper and molybdenum mining, and even today Logan Lake is home to Teck Cominco's Highland Valley Mine, the largest copper mine in Canada and is one of the largest copper mining / concentrating operations in the world. The operation is expected to be exhausted by 2009.
Logan Lake boomed in the 1980-82 period, its population soaring from about 1500 to 3000. A shocking event in 1984, when molybdenum markets collapsed, was the closure, without warning and with poor post-closure follow-up by the company, of the former Highmont Mine. Nor were other mining operations in the area immune to the economic challenges of the mid-1980's. Consequently, Logan Lake began to shrink: from just under 3,000 in 1982 to 2,000 by 1986. Since then, the population rebounded somewhat and now appears to have settled in at near 2300 (albeit somewhat older) persons. The town is already looking ahead to 2009 when the existing mine operation may close.
While the Highmont Mine closed in 1984, left intact were mining operations that were consolidated in 1986 to form the Highland Valley partnership that exists today. Logan Lake was and is still a mining service centre and continues to receive property tax revenue from the mining company. Thus, Logan Lake experienced a comparatively minor contraction challenge in the 1980's and can expect to face a more severe challenge some years hence when the economic life of current operations is reached. Logan Lake is an interesting case both retrospectively, in relation to its handling of the boom-bust cycle from 1980 to 1986, and prospectively, in relation to transition planning in anticipation of the complete cessation of mine operations five years from now.
Meadow Lake
Established as a trading post on the northern fringe of Saskatchewan in 1799, Meadow Lake went into crisis when the provincially-owned sawmill threatened to close in 1988 after operating sporadically with frequent shutdowns since 1981.
Sensing that the operation might be sold, sawmill employees joined with the Meadow Lake Tribal Council to buy the mill, and saved 300 direct and indirect jobs. For the past 15 years, the sawmill has offered stable, year-round jobs with few layoff or shutdowns. Local economic activities have expanded to include the world's first zero-effluent pulp mill and more than 120 independent forestry companies. The town's population never fell during the transition period and has since risen from 7,000 during the crisis to about 8,800 in 2002, an increase of almost 20% and sharply contrary to provincial population trends. Housing starts average about 12 annually and have increased 45% in the past 10 years. Average earnings have increased 20-40% for Aboriginal people and 40-60% for non-Aboriginal people. Although general unemployment remains high at 14%, Aboriginal workforce participation has increased from 33% to 58% between 1981 and 2001.
Although Meadow Lake's diversifying economy remains forestry-dependent, its robust recovery appears to be allowing it to weather recent downturns and layoffs in the forestry industry caused by the softwood lumber dispute.
Ogema
Located in a mixed farming and ranching area south of Regina, Ogema began a slow but continual decline in the 1970's as the agricultural economy weakened. The CPR's rationalization in the 1990's left Ogema isolated from large centres and reduced its strategic role as a regional service provider. The crisis came in 1996 when the CPR closed the 114 km Pangman-Assiniboia branch line that ran through Ogema. This led to the closure of local grain elevators and other businesses, effectively shutting down all industry and threatening services like schools. Over 20 years, the population fell from 441 in 1981 to 292 in 2001.
The community has no long-term debt and its tax base increased 38% between 1997 and 2001. Ogema's population has grown to 325, still well below levels before the railway closure but trends indicate the population will continue to grow.
Despite the initial shock of losing almost all of its infrastructure, Ogema's transition has been smoother than most because it has continued its historical association with the railway and agriculture while expanding into new areas like hog farming. Setting broader horizons and capitalizing on its central location in southern Saskatchewan, it has redefined itself on a regional basis. The town has recognized the need to expand recreational, health and educational services to help its population stabilize and grow. Ogema appears to be a town in control of its destiny.
Pinawa
Pinawa was established in 1960 as a planned community to house employees of Atomic Energy of Canada's (AECL) nuclear research centre 120 km east of Winnipeg. Without advance warning, the federal government announced in 1996 that the lab would close. Once the largest federal laboratory in western Canada with 1,100 employees at its peak in 1991, AECL now has only about 30 employees still working in Pinawa.
Pinawa's transition has been less traumatic than most, partly because the closure was gradual. Despite the closure, the population dropped only 10% from 1,670 to 1,500 residents. Generous early retirement and 100% home buyout packages to lab employees eased the pain considerably. AECL continues to pay a grant-in-lieu that provides 50% of the municipal tax base to support the local government to maintain municipal services, thus avoiding a fiscal crisis and reducing the closure's impact. Although federal-provincial efforts to privatize the lab failed, new high-tech companies have been attracted to Pinawa because of its scientific background and facilities. Superb infrastructure has made Pinawa an attractive commuter community to Winnipeg (linked by a series of highways and two-lane roads.
Pinawa's greatest transition challenges remain the specialization of its workforce and the negative pubic perceptions of the nuclear industry. Should AECL reduce its grant-in-lieu, Pinawa's tax base would be severely eroded as would its ability to support services.
Tahsis
Incorporated as a municipality in 1970, the Village of Tahsis is a small and remote forest dependent community on the west coast of Vancouver Island. In 2001 the local lumber mill – that had supplied over half of the local jobs and tax base – permanently closed. This put a lot of stress on mill workers and their families who had already been impacted by the sporadic operation of the mill in preceding years before closure. Many have decided to leave the community to work and live elsewhere.
For its part the municipality continues to work hard to adjust to the change, working in collaboration with the province and the federal government. The significant loss of taxation expected in 2004, along with the demand from residents to maintain all local services (recreation in particular) will create operational challenges for the village. But this will be aided by the fact that the municipality has low debt and significant financial reserves.
While Tahsis has stabilized from the loss of the lumber mill (population exodus has stopped), the municipality and the community still has work to do to create a more diverse, albeit smaller, local economy. The community will always be challenged by its remoteness, but its natural setting, abundant resources and continually improving gravel road connection to Gold River (63 kms away) and the rest of the island are strengths to build on.
Tumbler Ridge
Founded as a planned mining town in 1981 as part of a huge economic initiative to export coal to Japan, Tumbler Ridge is located in the northeastern Rocky Mountain foothills. The town was thrown into crisis when the Quintette mine closed without warning three years ahead of schedule. Its stability was compromised further when the Bullmoose open pit mine closed in 2003, although the town had three years advance warning of this closure. The population reached a low of 1,931 from is 1991 peak of 4,800.
Tumbler Ridge was hit very hard by the closure of the two mines, which provided 70% of all local jobs and 65% of the municipal tax base. Despite such huge losses, the transition has been easier than for most resource-dependent communities because of actions that stabilized the population quickly. The combination of excellent housing stock owned and re-sold by the town, modern infrastructure, entrepreneurial local leadership for a debt-free municipality and provincial grants and resource revenue sharing opportunities have allowed Tumbler Ridge to survive the crisis and begin to grow again. Tumbler Ridge's population has now rebounded to 2,200 and may be as high as 3,000, unofficially. A recently opened coal mine and nearby natural gas exploration have spurred a new wave of economic prosperity in Tumbler Ridge.
While it will never overcome its geographic isolation, Tumbler Ridge has the benefit of being part of a region with diverse economic opportunities in oil and gas, tourism, forestry and agriculture. Most of these activities (current and potential) exist within the town's huge municipal boundary to ensure that future economic development contributes to municipal taxation revenues to pay for expanding service delivery. Tumbler Ridge also has the advantage of political support from local leaders in adjacent communities who believe that the survival of the community is important to the entire region.
Uranium City
Accessible year-round by air only, Uranium City sprang up in the remote northwestern corner of Saskatchewan in 1952 to exploit Canada's largest uranium field. By 1959, the town had 12 mines and 3 mills but they were closed one by one over the next two decades. After investing $100 million over five years in mining operations, Eldorado Mining unexpectedly closed its last mine in 1981 because of limited military needs and declining ore quality.
The surprise overnight closure of the last mine led to an immediate, devastating and permanent economic crisis. The population immediately plummeted from 2,000 to 400 and now hovers between 150 and 200. The environmental hazards created by uranium mining further undermined the town's viability. With no economic alternatives to uranium mining and no adequate transportation links, it has been impossible for this isolated northern community to overcome geography to diversify its economy. Salvage operations on abandoned properties are the largest local business.
In 1984, the municipality ceased to exist and has played no official role in the region's future. The province manages Uranium City as a northern settlement and provides health, education and social services but remaining residents worry the province will withdraw these or even basic utility services altogether.
Central Canada
Murdochville
Murdochville lies in the heart of the impoverished and depopulating Gaspé Peninsula. It's economy has depended primarily on the sporadic operation of Noranda's copper mine and smelter and has few options to develop tourism, fishing or logging industries common in the rest of the Gaspé. After two decades of decline, the mine's permanent closure in 1999 and the smelter's closure in 2002 was devastating to the community, costing 300 jobs, wiping out incomes for most of the 1,171 population, causing a 30% population drop over 10 years. Property values plummeted 65% and municipal tax revenues dropped 70%.
Murdochville's transition has been particularly difficult. Not only has there been massive job and population loss, disagreement between the different levels of government has made it difficult to find a way forward. While the local government has favoured community closure in the past, the current provincial government wants the town to survive. Murdochville's future prospects could be bright if it can overcome the loss of hope on the part of residents, lack of local political agreement and the difficulty in attracting new businesses.
Elliot Lake
Located halfway between Sudbury and Sault Ste. Marie, Elliot Lake was a prosperous uranium mining town with a peak population of 24,887 in 1959. Mining has been in decline since 1966 when a key market, the United States, decided to meet its demand domestically. The town collapsed to a population of 6,664 but gradually increased during the 1970's because of federal plans for Candu reactors and Ontario Hydro's interest in inexpensive energy sources. Anticipating a population of 30,000, the town invested heavily to expand its infrastructure. However, uranium prices dropped 75% during the 1980's and the mines closed one after another. The last mine closed in 1996. Elliot Lake's population has now stabilized at 13,590.
Elliot Lake's transition away from being a mining town has spanned three decades and has significantly changed the community. Access federal/provincial funds for economic diversification helped the community adjust along with its proximity to the Trans-Canada Highway.
Elliot Lake's long-term prospects for continuing as a smaller town with excellent and abundant infrastructure are good. High costs of municipal services and the limited incomes of retirees attracted to live there may limit recovery potential. It's huge supply of housing stock offers new residents high quality, low cost housing but has also served to depress the housing market and tax base.
Atlantic Canada
Bishop's Falls
Bishop's Falls served as the head office of the provincially-run Newfoundland Railway and as the major railway service centre in central Newfoundland. Bishop's Falls' transition crisis of difficult job losses extended over several decades until the final railway closure in 1988 under the federal government's $800 million ‘roads for rails' deal. The psychological impact of losing its historic railway identity was as difficult as losing the last 75 railway jobs, and the population of 4,300 began to fall by 8.8% to 3,800, a rate just slightly more than the provincial average.
Faced with a choice between leaving the province and finding local jobs, most residents chose to stay. This kind of community spirit greatly eased the transition by retaining population and the property tax base. Other advantages for the community in managing through transition included access to federal/provincial economic diversification funding, abundant hydro power and growing regional demands for services. Because roads replaced rail lines, Bishop's Falls did not lose the advantages of its central location and port links, allowing it to attract light manufacturing industry.
Canso
Founded by Basque fisherman in 1604, Canso is a small fishing community on the northeastern coast of Nova Scotia. The unexpected collapse of the once lucrative Atlantic fishery in the 1990's shocked Canso and caused great economic hardship, as well as destroying its 400-year sense of identity. Unemployment nearly doubled to 31.7% between 1990 and 2001 and the population declined 19% from 1,228 to 992. Adding to regional difficulties, Canso's Seafreez Foods fish processing plant shut down in 2002, costing 200 more jobs in Canso and the region. Half of these employees did not qualify for employment insurance (EI) and the benefits of the other half ran out in Spring 2003.
Canso's transition challenge was severe but lessened by timely and effective federal/provincial action to create short-term jobs, re-open the Seafreeze plant in May 2003 and promote tourism based on the town's 400-year history and local beauty. Having stabilized the fish processing industry, the town is actively developing further economic opportunities through sustainable tourism, preparing for the development of offshore oil and gas, and in setting up wind turbine farms.
Despite these steps, Canso continues to have high unemployment and must depend on fluctuating but potentially lucrative shrimp and crab markets or on the uncertain potential of petrochemical exploration. Canso's other challenges remain its small tax base and its continued dependency on funds from other levels of government for large infrastructure projects.
Great Harbour Deep
Great Harbour Deep was an extremely isolated coastal community accessible by ferry only six months a year or by an occasional airplane. Depending exclusively on seasonal employment in cod and salmon fishing/processing, the town was hit hard by the 1992 province-wide closure of the cod fishery. Great Harbour Deep's landed catch decreased forty-fold by 2001 and the processing plant closed. The town's population dwindled from a peak of 245 in 1986 to 135 by 2001. The loss of tax base made it impossible to balance the budget and meet debt payments.
Great Harbour Deep could not overcome its remoteness and lack of economic diversification options, despite an attempt to open a fishing lodge. Finding no options for economic diversification, the local and provincial governments agreed to shut the town down. Long-term benefits, such as providing residents with better access to services and job opportunities, also favoured relocation. Homeowners were offered relocation packages and the town was declared evacuated by December 2002.