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$1.00 plus 7¢ GST S
($1.10 plus 8¢ GST
outside of the Terrace area)

Horseshoe school may

By JENNIFER LANG
TWO YEARS after the battle over the
possible closure of Parkside Elemen-
tary school ended, the fight to save
another horseshoe area school may
just be beginning.

The school district is taking another
look at closing an elementary or pri-
mary school in the horseshoe area and
converting it into a facility for high
school students now going to two al-
ternate programs downtown, Randy
Smallbrugge said last week.

School trustees backed down from a
plan involving Parkside Elementary in
2000, citing high costs.

Smallbrugge cites the opening of a

new, 250-seat elementary school on
the bench this fall, which will take
Students now making the trip to a
horschsce school, and overall declin-
ing enrolment as the two main reasons
why the district has revived the issue,

He said alternate students at the
Teen Learning Centre and at Lakelse
Junior High are cramped and crowded
into two rented downtown buildings.

Smallbrugge said the school board
has approved a plan to consider moy-
ing those alternate programs into a
school in the horseshoe area.

“We don’t know which school,”
Smallbrugge said, adding all three
elementary schoois in the area — E.T.

Kenney, Parkside, and Clarence Mi-
chiel — have been considered.

“We're looking at all of them to
see how we can best utilize their
space,” Smallbrugge said.

Assistant superintendent Rob
Greenwood is preparing a feasibility
study that will recommend different
options to the school board, which
mects next week in Terrace.

Greenwood said public comment
will be sought before any decisions are
made.

Meanwhile, the school district is
not ruling out having to close schools
to save money regardless of whatever
action it takes concerning its horse-

| Wednesday, February'27, 2002.

be closed

shoe schools.

A provincial government freeze on
school district budgets and a legislated
wage increase for school teachers may
mean school closures in this district
are necessary. .

Bigger class sizes and teacher lay-
offs are a certainty, Smallbrugge said.

Add declining enrolment into the
mix — the district lost 329 students in
the past two school years — and school
closures are a possibility, too.

“We may very well have to look at
sckool closures in all of our communi-
ties,” Smallbrugege said.

He and other district officials learn
later this week how much money this

1

school district will receive for the next
three years,

School districts have been promised
three-year budget envelopes, but
they've also been told to expect a
change in the formula that determines
how much money districts receive.

Districts are also being asked to
cover two-thirds of a 7.5 per cent wage
increase over three years for teachers
but aren’t going to be given additional
money to pay for ‘it.

Smalibrugge pointed out a number
of other school districts are so financi-
ally strapped they’re handing in deficit
budgets for this year. That’s not likely
to happen here, he said,

¢

H Smouldering remains —

KODA and her owner are out of a home after a fira destroyed
this trailer at 3908 Hagen St. in Thornhill Feb. 21. Local RCMP
said a grease fire started in the kitchen around 3:30 a.m. Po-
lice said foul play has been ruled out. The resident, his two

young daughters and their pets were able to get out of the
home without injury. The home’s owner, Lonnie Rabideau,
Said the resident — his son’— did not have insurance on the
contents of the hame. SARAH A. ZIMMERMAN PHOTO. _

Creditors will be paid a little bit
if they approve of Skeena sell deal A

- of regulations health authorities can put to use.

By JEFF NAGEL
LOGGING contractors and creditors will get 13
cents on the dollar for Skeena Cellulose’s un-
paid debts if NWBC Timber and Pulp Co.’s
purchase is approved,

The Montreal-based group that includes key
officials from former owner Repap Enterprises
have pledged to pay $2 million towards the
more than $15 million SCI owes.

The purchase price for Skeena is $6 mil-
lion, to be divided between the province and
the TD bank.

If cabinet approves the sale as expected
today, the vote of creditors on March 25 will
be the final major hurdie for the deal to pro-
ceed,

Other details of the sale remain secret until
it closes April 19, The restructuring offer to
creditors is to be tabled next week.

The final sale price is less than half the $15
million NWBC offered previously.

Documents filed by NWBC in court indi-
cate it planned to sell some of Skeena’s nearly
$400 million in tax losses to another company
that could use them to offset its profits. .

A court affidavit shows NWBC believed the
tax losses could be sold for 10 to 15 per cent
of their value. a

The price offered dropped after NWBC -
realized a sizable amount of the tax losses -
couldn’t be used. , oye

NWBC president Daniel Venicz admitted

the tax losses are valuable, but downplayed
the issue and rejected suggestions it could sell
the tax losses and teave SCI in the lurch.

“We haven't worked so long and so hard to
buy tax losses,” he said. “We are buying a bu-

‘sinless we want to own and operate. We bought

Skeena.”

He said the tax losses may help attract in-
vestors because it means they’re able to invest
in a company that can take advantage of tax-
free profits for a number of years.’ :

“Those tax losses attract money,” Veniez
said. “An investor gets tax-free profits. That
jacks up their return on equity, which is what
any investor wants.”

“We're going to make use of every oppor-
tunity available to us to recapitalize the com-
pany,” he added.

Enterprise minister Rick Thorpe called the
price tag fair given what could have been col-
lected under bankruptcy.

Thorpe said the deal does not give any sub-
sidies that he’s aware of, nor does it restrict
future B.C, forest policy.

Although NWBC has pledged it will raise
$150 million to invest in Skeena Cellutose,
Thorpe admitted there is no mechanism to en-
force that. re Sone

-“T think at some point:in time we have to

take people at their face'value and we have to
“take péople at their. public commitments,” he

said. “I believe they're committed to doing

1

those things.”

As of last week, Veniez said, NWBC has
raised $75 million or half of what it plans to”
invest in SCI. He said that had been done ‘in

three weeks and he was confident the.rest will
also be raised. Te

“Our threshold to get us into a comfort zone —

is $100 million by closing, ideally more -in
place before then,” he said, 2):

Veniez said the plan is to restart the saw-
mills and pulp mill this summer, with logging
to start some time earlier.

“We’re going to have to recruit people to
come back to Skeena,” he added. “It’s been
down for a long time and a lot of good people
have left. We’ve got to find ways to. bring
them back or find new people.”

Prince Rupert and Port Edward have signed

agreements with NWBC that will see property

taxes repaid over time.

Terrace, which is owed much less, has not
signed such a deal and may seek to simply
preserve its- option of eventually selling the
local sawmill in a tax sale if taxes aren’t paid,

‘Court documents also reveal a. third late
bidder was calling itself Coast. Cellulose
Group and included former Skeena Cellulose
CEO Bill Steele.

The province negotiated with the group, but
-it didn’t” have enough time to deal: with the
fine details of a sale and wasn’t willing to put”

up a ron-refundable deposit. -

_

Health bosses
told to cut costs

SENIOR HEALTH care managers in the north are being
told to cut 10 per cent from their direct patient care bud-
gets and 20 per cent from non-direct care budgets over
the next three years.

All told, the Northern Health Authority (NHA) ex-
pects a three-year budget shortfall of $45.5 million, pri-
marily from wage increases and from a budget freeze
brought in by the provincial government.

Managers also have the option to come up with ways
to boost revenues, authority chief executive officer Peter

“Warwick-said in-a-memo-to-managers. -.. .....

“The only rule is that the status quo is riot an option —
challenge all assumptions as to what services you pro-
vide and how your services will be provided,” said War-
wick. He’s predicting a deficit in the first year of $22.5
million. That fiscal year begins April 1.

That’s to be followed by a $13.5 million shortfall in
year two and a $9.5 million shortfall in the third year.

Four per cent is to come off of direct patient care for
the year beginning April 1 and three per cent for each of
the two subsequent years. Non-direct patient care is to
take a 10 per cent hit this year followed by cuts of six
and four per cent in the second and third years.

Warwick’s formed what he’s calling redesign teams
to tear apart every facet of northern health care in look-
ing for more revenue or more ways to save money.

The teams will “oversee a process ta have services
delivered in a different manner which will reduce re-
source use by the targeted levels. The goal is to provide
an equal or better service within our constrained
budgets,” Warwick said.

Each of the teams will report to a senior manager.
Dieter Kuntz, who used to run the old community health
council here and is now in Prince George, is in charge of
cutting costs in food services, laundry services and
housekeeping. The redesign teams will report back the
third week of March.

Now that the provincial budget has been released, the

’ Northern Health Authority will soon know what its exact

budgets is, meaning it can then decisively plan on ways
to cut costs, ,

“We'll be making decisions in a matter of weeks,”
said Cholly Boland, the NHA official in charge of health
care in Terrace and Kitimat. “The financial imperative
is there,” he added,

One measure which will help health authorities cut
costs is new legislation allowing them to ultimately con-
tract out-services. But that has yet to be defined in terms

hotly criticized

oe, By JEFF NAGEL.

“A DECISION to allow more than a third of the tim-
ber cut in the northwest to be exported as raw logs
has outraged unions and environmentalists and put
Skeena’s MLA on the defensive. .

Roger Harris struggled last week to explain the
measure he helped craft as one geared to put log-
ging contractors back to work.

“In unique times and tough situations you have
to take measures to put people back to work,” he
said, adding he dislikes log exports.

The Feb. 13 cabinet order okays the export of a
maximum of 35 per cent of timber harvested from
each licence in the North Coast, Kalum and Ki-
spiox forest districts for the next three years.

Unionized sawmill workers say selling raw logs
to Japan or China effectively exports their jobs in
B.C, sawmills as well.

“We're totally pissed off,” said Surinder Malho-
tra, the IWA’s local rep here. “They're destroying

our children’s future by letting these logs go.”
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