BC Business
If ever there was a signal that the old days for BC’s economy are over, its in Catalyst Paper’s fight with four municipalities over taxes.
Catalyst is going to court to formally petition for tax relief in the Vancouver Island communities of Campbell River, North Cowichan, and Port Alberni as well as in Powell river. Catalyst says it’s paying way more than its share in municipal taxes to the four towns – some $92 million in the past five years. It still owes them about $22 million and is refusing to pay. One can understand why. Catalyst has been losing money for years, including about $186 million over the same period. Also, reports it commissioned shows that big industry often pays as much as 50 per cent of municipal taxes. In many BC towns, including these four, companies like Catalyst, which has been around BC for decades in various iterations and under various names, are often the only big industry. The towns were usually built around some big forestry or paper operation. It was a paternalistic system that started more than a hundred years ago. Big resource company opens a manufacturing plant in some isolated location and a town grows around it. For generations, the entire town is dependent on that company – the proverbial mill – and like any dependency arrangement, alternately hates that upon which it’s dependent or milks it for everything it’s worth. But that was then and this is now. Globalization, shifting economics, short sighted resource exploitation policies, the rise of new industries (and resulting fall of old ones) and several other factors have pretty well destroyed the system. BC isn’t unique in this, of course. It’s a problem across Canada, where for far too long everybody has been content to continue their dependence on resource extraction instead of modernizing into new and emerging industry. Even today, our economic fortunes still rise and fall on whatever resource has always been the backbone of the economy. In BC, it’s forestry, Alberta oil, Quebec manufacturing and mining, Ontario, car manufacturing. But as Catalyst’s survival mode war with its dependent towns shows, “trouble at mill”, to borrow the old Yorkshireman’s line, is not just a recession problem. It’s a systemic change, and it’s not going away.