Martz says she favors Butte mine tax credits

Montana Resources officials asked Gov. Judy Martz on Friday to support their efforts to reopen the company’s idled copper mine in Butte by providing tax breaks and some state loans to train workers.

By BOB ANEZ – Associated Press Writer

In a meeting with representatives of the company and Butte-Silver Bow, an enthusiastic Martz said she’s fully behind resumption of mining.

She pledged her administration’s support and told the state Revenue Department to quickly determine whether the company qualifies for tax credits as a new business in the state.

‘‘I don’t want this to sit on a desk,” she told Revenue Director Linda Francis during the meeting. ‘‘I want it to move.”

Frank Gardner, a former Montana Resources president asked by the company to explore the possibility of reopening the mine this year, said state tax credits are a crucial factor in the decision whether to resume mining after a nearly three-year shutdown.

‘‘We want to get Butte open,” he told Martz and other administration officials.

Judy Jacobson, chief executive for Butte-Silver Bow, said the city-county government will request a $1.8 million loan from the state Board of Investments to provide money for the company to buy new electrical transformers at the mine.

The company suspended operations in 2000 when the skyrocketing price of electricity became unaffordable, leaving more than 300 workers without jobs.

Gardner said reopening the mine would cost $12 million to $20 million and would create 359 jobs. Dennis Washington, a Missoula industrialist whose Montana Resources Inc. is majority owner of the mine, would pay those startup costs, he said.

Gardner said a decision on reopening will be made by Aug. 15, because the company wants to avoid a winter startup made more difficult by cold weather.

Francis said her department will have to decide whether Montana Resources fits the legal description of a ‘‘new or expanded industry” eligible for tax credits. The credits would apply to property, metal mines license and gross proceeds taxes.

Butte-Silver Bow County Attorney Bob McCarthy said he believes the company does qualify, just as in the mid-1980s when it started mining a few years after Anaconda Co. ceased operations.

The job training funds available from the state could be used to reimburse Montana Resources for its cost of training employees.

Steve Walsh, company president, said he believes that at least half of the workers laid off when the mine closed are available to return, but the figure could be as high was 80 percent.

The Board of Investments loan would be repaid by the local taxes the company would pay once operating, Jacobson said. The advantage in having the local government obtain the loan is that Montana Resources will be able to a get a dollar-for-dollar credit for the taxes used to repay the money, she explained.

Gardner said new transformers are needed because the old ones contain a cancer-causing solution called PCBs and are undependable after sitting for years.

On another issue of concern for the company, Jan Sensibaugh, Department of Environmental Quality director, said her agency knows of no reclamation issues that would prevent resumption of mining.

Gardner said officials have a big menu of issue to consider before a decision can be made, including metal prices — the mine produces copper, molybdenum and silver — utility and fuel costs, smelting and refining charges, freight expenses and equipment condition.

‘‘There’s still a long battle,” he said.

Martz, whose home is Butte, said she’s all for mining to return.

‘‘This is part of our heritage,” she said. ‘‘Our real blessing, our real gift is what God put in the earth. We’ve got to get it out and do it environmentally safely.”

http://helenair.com/articles/2003/07/26/montana/a07072603_02.txt