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Federal tax dollars, the Yukon and a deep dark abyss

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Living in the Yukon Territory means one is exposed to a financial fantasyland that is paid for by southern taxpayer dollars. There are transfer payments of about $900 million a year to the Yukon Territorial government to provide services to the roughly 35,000 residents. In addition there is the Federal Contaminated Sites Action Plan, the Northern Housing Fund  and the Green Infrastructure Fund (naming but a few) to provide additional taxpayer dollars. These would seem to be flung around as if the government was a drunken sailor on a payday spree.

Given that it is an election it does provide a bit of a dilemma for Yukon voters. None of us want the federal cash flow to end, but one does suspect most of us do want the money spent wisely. After all, Yukoners are taxpayers too. A question that should be asked of all candidates of all political stripes is what will they do to ensure the federal monies keep flowing but at the same time is spent a tad more responsibly that it is now. 

Let us offer the Faro mine site as exhibit A in this sad tale of what happens when federal dollars are spent with abandon and lack of oversight. Following the time honoured practise of privatizing the profit and socializing the risk the last owners of this lead-zinc mine in the central Yukon abandoned it in 1998. This left the taxpayers with the bill to clean it up. A really big and massive bill. The latest guesstimate is around a billion dollars and it will take four centuries. Yes, four centuries. It will probably require funding from the Federal Contaminated Sites Action Plan for water treatment in perpetuity. Yes, for ever. 

In the last five years over $82 million have been paid to one consultant company alone on the Faro cleanup project, that company being CH2M Hill. They got a mention in Naomi Klein's book The Shock Doctrine. Companies such as this are to be found wherever there is a massive disaster to be cleaned up. Afghanistan, Iraq and now Faro. That is where you can find CH2M Hill tidying up and profiting from the messes that other humans have made. 

It is unclear exactly what is happening at Faro. As can be seen in this video the tailings dams and ponds do not appear to be remediated. There seems to be no oversight or analysis in the public domain on how money is being spent on this cleanup. Maybe the next Federal government will be more transparent on the fiscal abyss that is this abandoned mine site, one of many in the North. 

Another black hole for taxpayer dollars seems to be the Northern Housing Fund. Way back in 2006 Ottawa gave the Yukon government $50 million for affordable northern housing. The reason for this is because, as a general rule, there is very little surplus housing north of 60. People build only exactly what they need given the expense of land, supplies and labour. This leads to a shortage of affordable housing, particularly rental units. The Northern Housing Fund was apparently meant to address this shortage.

Some of the money would appear to have been spent wisely, while some would appear not. It is unclear to this author whether all the money from 2006 has yet been spent, and if so on what. What is known is that a third of renters in the Yukon spend over 30 per cent of their income on rent. Once again, where was the oversight by the federal government in the way taxpayer dollars from the Norther Housng Fund were spent to alleviate this situation in the Yukon?

In 2006 the federal government gave $71 million to the Yukon Energy Corporation to increase the hydro capacity at Mayo Dam. Since it is a hydo dam, and since hydro is considered in some circles as automatically being green, the dollars came from the Green Infrastructure Fund.

There was much political hoopla surrounding this whole project, of which the current prime minister was keen to claim a portion of the credit. Known as Mayo B it cost in total $120 million (the extra dollars coming from other levels of government and electrical ratepayers) and at the end of it all increased the Yukon's hydro grid by ten megawatts. Paying $12 million per megawatt is nothing short of scandalous. To put it in perspective a one megawatt wind turbine, paid for and installed in the Yukon, costs about $4 million.

On some projects it would appear the Yukon is a deep abyss for federal tax dollars. Money is being spent with what appears to be little to no regard for value. Now there is nothing wrong with federal tax dollars being spent on projects that safeguard the environment, provide affordable housing or create much needed infrastructure. In fact, all of these goals are worthy. The problem is how it is being done, and is it being done in a cost-effective manner. 

To spend tax dollars on dubious projects with what appears to be little to no fiscal oversight is of great concern. Past politicians should answer for it, and future politicians should provide answers on how they would ensure it never happens again.

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