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Province preparing to step into Essar Steel Algoma restructuring

Northern Ontario Heritage Fund Corp. is working on "major, major funding" to help the struggling steelmaker, a member of its board disclosed today.
2014-04-07 Essar Steel Algoma 003
File photo by Kenneth Armstrong/SooToday

The Ontario government is planning a major intervention in Essar Steel Algoma's recovery from insolvency, the Sault Ste. Marie Economic Development Corp. learned today.

News of the funding was disclosed this afternoon at a meeting of the EDC board by James Caicco, a local director of Northern Ontario Heritage Fund Corp. (NOHFC), the provincial government's crown corporation and development agency.

"We're working on a major, major funding from NOHFC to help in the restructuring," Caicco said.

Caicco, a longtime Ward 1 councillor and one-time mayoral candidate, went out of his way to emphasize that the funding request didn't come from local government officials.

"That wasn't initiated from the city or the EDC," he said. "It was initiated by the bureaucrats in Toronto."

Caicco used the expected Essar Steel Algoma funding initiative to emphasize the need for local officials to apply for available NOHFC cash.

"You're the leaders of the community," he told the EDC directors. "You need to think of us, because we can help in certain circumstances like that. And we want to be there."

Caicco also talked about the Sault's declining role in film and television production, even though those are major current priorities at NOHFC.

Last year, 16 film productions were funded in Sudbury, compared to just one in Sault Ste. Marie, he said.

Downtown Sault Ste. Marie comes alive when film crews are in town, Caicco told the EDC.

NOHFC currently provides $25 million a year to Northern Ontario productions through its Northern Business Opportunity Program, the crown corporation's biggest funding source.

Sudbury's equivalent of our EDC, the Greater Sudbury Development Corp., has two staffers assigned to movie productions, Caicco said.

Tom Dodds, chief executive officer of the Sault Ste. Marie Economic Development Corp., said that a rekindled emphasis on television and film production may result from the ongoing third-party performance review of the city's economic development activities by MDB Insight.

MDB is expected to present a draft version of its review to City Council on December 6.

Sault EDC president and board chair Robert Reid said today that he will ask for a courtesy copy of  the report prior to the December 6 council meeting.