Midway was devastated when, three years ago, its lumber mill closed. Residents of the tiny B.C. town, located just north of the U.S. border, started packing—200 were suddenly out of work—and the schools got ready to close. Then, a year ago, something incredible happened.
Midway and a few surrounding Kootenay communities banded together and, with the help of private investors—including 42 locals, who raised a total of $700,000—put together $1 million to buy the mill. They found a new tenant, and a $10-million mill refurbishment project brought life back to the community. But now they have to raise another $800,000 or lose their investment—and control of the mill.
“You could see the hope. People started making plans for the future instead of just next week,” Randy Kappes, Midway’s mayor and the owner of the town’s single gas station, told Maclean’s. Now, he says, “they’re holding their breath.” The agreement, hashed out last January, included a $1-million mortgage from the mill’s owners, Montana’s Fox Forest Products. Originally, the loan was to be repaid in full, 60 days after the first lumber began rolling out in October. But Fox refused to close the deal until the deadline was pushed up to Aug. 31. Lawyer’s fees and start-up costs ate up most of the capital, and new investment stalled, explains Stephen Hill, the deal’s chief architect.
But there is hope for Midway yet. With the deadline looming, Hill, a financial adviser from Rossland, began pounding the pavement in Vancouver, looking to drum up new investment dollars; last week, a group of venture capitalists expressed interest in covering the loan. Hill says he’s just waiting for a phone call to confirm the deal. “It’s been a firestorm,” he says. “We’re gonna make this work.”