Disappointed but not surprised, Fort Frances councillor says of rejected mill bid

Local and provincial politicians say they're disappointed that a deal that promised to reopen the shuttered paper mill in Fort Frances, Ont., fell through and that the company that owns the site appears to be focussed on demolishing the plant.

Resolute Forest Products informed municipal leaders in Fort Frances on Monday that it rejected a bid submitted by Repap Resources Group on Friday for the mill property and all its assets. Repap had said it would reopen the mill, which has been idle since 2014, if it could acquire it, and said between 600 and 700 jobs would be created.

Resolute said Repap's bid "fell short on multiple fronts."

"We're not necessarily surprised by this outcome — Resolute has certainly reflected a disinclination ... to sell the property to a buyer that would operate it," Coun. Douglas Judson told CBC News. "So it seems to us this is simply a fulfillment of those statements."

"Of course it is disappointing."

That disappointment was echoed by Greg Rickford, the Conservative MPP for Kenora-Rainy River.

"Of course, I'm profoundly disappointed," he said. "I mean, the hopes and dreams of this community for more than six years now ... have been pinned to the prospect of that mill reopening."

Officials with Resolute indicated they are now "squarely focused" on redeveloping the mill site, according to a letter sent by company president Yves Laflamme to Fort Frances Mayor June Caul, and are working to finalize a deal with a company that reportedly specializes in decommissioning and remediating industrial sites.

Resolute vice president Seth Kursman said more specific details about proposed redevelopments will likely be unveiled "in the coming weeks."

The mill property is right in downtown Fort Frances.

"We must conclude again that a return to manufacturing operations is most unlikely," Kursman said. Rickford said he has been concerned about the "compressed timelines" involved in the process.

Aside from losing the prospect of hundreds of jobs in the community, Judson said redeveloping the site, along with changing its zoning, will hurt the town when it comes to budget time.

"It attracts a fairly sizable tax revenue source for the community and to see the site ... change zoning and be put to use that doesn't necessarily attract the same tax assessment is concerning," Judson said. "It's going have cost consequences."

"I think anyone in local government will tell you that we are under tremendous pressure at budget time to balance our books."

Town officials have said they will use municipal site control plans, in case the property comes up for demolition, to require owners to effectively provide the town with a $20 million line of credit and undertake a number of third party studies.

"Those are all tools that are in our toolkit as a community that we will ensure are put to use to respect the public and community interest," Judson said.

"We have a strong sense of entrepreneurship and community vision here that will be put to use if that site is redeveloped," he added. "But at the end of the day, there are a number of financial question marks that I think area residents are right to be concerned about."

'The door is still open' MPP insists

While Resolute is saying that it's focused on redeveloping the site, Rickford said Repap Resources or another company, could still enter into its own agreement with the redevelopment company to use all or part of the mill site, something Kursman also acknowledged.

"The door is still open and I think our job now is to see if we can mobilize to ... ensure that the access to fibre is there for the community and their mill or some other forestry operation," he said. "I'm an eternal optimist."

Rickford noted that the forestry licence for the Crossroute Forest, which Resolute holds as it supplied the Fort Frances mill with wood, will be up for renewal in the next couple of years and stakeholders will have the opportunity to provide input.

"I think we have a responsibility to ensure that if there's the potential for a new market entrant that that remains a viable prospect," he said.

"I am not ready to give up the fight, and I know the community of Fort Frances is not ready to give up either," Rickford posted on Facebook.

Kursman said Resolute "really exhausted our efforts," to find a buyer to take over running the mill and made accommodations for Repap's bid when that company became interested in the property.