Board chairman wants to stop mine, but he’ll take the company’s money

By M.D. Kittle | Wisconsin Reporter

MADISON, Wis. – Pete Russo over the years has sounded like a conflicted man.

The chairman of the Ashland County Board of Supervisors at turns has said he’s open to negotiating a deal that would bring a proposed $1.5 billion iron ore mine to a small portion of the county. That’s apparently when he’s talking to the folks at Gogebic Taconite, commonly known as GTAC, the company that wants to develop the 3.75-mile first phase of the mine in Iron and Ashland counties, just south of Lake Superior.

When Russo, 73, is talking to mine opponents and the press, however, he takes a different stand, much more confrontational.

“Doggone it all! We have to stop this mine. You have to stop it. There’s no choice because, if it ever goes in, we’re gonna be in deep trouble,” Russo told a get-together in late June of the Penokee Hills Education Project, a group vehemently opposed to GTAC’s proposed mine.

“We’ll fight to the bitter end on this,” he added.

While the chairman talks the talk of opposition, despite the county board’s position to remain neutral during the vetting process, he sure doesn’t mind taking the company’s money.

The county last year passed a resolution requiring GTAC to spend $100,000 up front – and possibly millions of dollars in the future – to obtain a permit to mine in Ashland County. The company is conducting testing and data collection in pursuit of various operational permits from the state and federal government.

Russo tells Wisconsin Reporter that Bill Williams, president of the Florida-based Gogebic Taconite, called the county board chairman and said the company would not pay the $100,000 fee.

“I said, ‘You either pay for the permit or you’re not going to mine,” Russo said, adding a chilling admission.

“I was not going to tell him that there is no way in God’s green earth the (county) zoning committee will ever allow them to mine,” Russo said.

He’s got plenty of plans for the permit money, and what could be a bottomless pit fund, seeded with GTAC’s cash.

“People are going to move in, they’re going to put their children in schools. That means there’s going to be an increase in students, somebody’s got to pay for that,” Russo said, as reported by Northland News Center in June 2013.

GTAC spokesman Bob Seitz said Russo’s comments are the epitome of bad faith.

“If you are taking money from somebody with no intention of acting in good faith, that would be a question for the board,” Seitz said when asked whether he believes Russo’s comments describe an act of theft.

Ashland County Supervisor Joyce “Pepe” Kabasa said Russo’s statements raise a question of fairness, and integrity.

“If we’re not going to let them mine, that money doesn’t belong to us,” she told Wisconsin Reporter. “If they say they’re not going to give the permit, why take the money and use it for something else?”

Kabasa has had her run-ins with Russo. She was one of five board members to oppose his re-election to chairman, and she claims she has “ended up in Egypt,” exiled from key board committees because of her opposition.

The supervisor says she is for safe mining in Ashland County, but she has growing concerns that GTAC can do that. Still, she said she will live by the board’s pledge to remain neutral during the information-gathering process.

Scott Manley, vice president for the Wisconsin Manufacturers and Commerce, a vocal supporter of the mine project, said it is “unfortunate” for somebody in a leadership position to be so against an economic development project that would create hundreds of jobs.

“He’s dismissing that opportunity in the project before the scientific and data collection can be fully evaluated,” Manley said. “You have to be strongly against bringing hope and jobs to an area that desperately needs it to reject it before the scientific merits can be judged.”

“You have to wonder why this county has such high unemployment when leaders are dismissing such economic growth. They’re basically saying, ‘No thank you. We don’t want your investment.’”

But it seems Russo does.

“We need to bring the mining company to the table with us. Everything in that ordinance is negotiable,” he said in the Northland News piece.

Russo, however, has repeatedly said he does not trust GTAC. He said the company over the years has promised the project would bring thousands of jobs to the Northwoods, but that target has shifted.

Not so, countered, Seitz, who said the company has never set a job number. Estimates were derived from a consultant’s report, which GTAC paid for, and the projections are for about 700 direct jobs, with another 2,800 spin-off jobs created in the local economy.

It is possible that GTAC could cut Ashland County out of the project altogether.

The proposed project includes about 3,200 acres, a little more than 400 of which are in Ashland County.

Iron County has been much less restrictive in its negotiations with the company.

Russo says he’s heard talk before that GTAC might pull out. It’s just blustering, the board chairman said. Ashland County has a good share of the iron ore the company wants.

True, Seitz said, but far down the road – in the second phase of the project, about 35 years and a different county board from now.

“We would like to be operating in both counties. It makes the most sense economically for the area,” Seitz said. “Every indication we’ve gotten until recently from Chairman Russo is that everything in the ordinance is negotiable and that he would work with us to bring this project to Ashland County.’

“Certainly if the county board doesn’t want jobs and tax revenue that comes with this project, that will be a factor in our decision-making,” he added.

In other words, if Ashland County says, no, it could lose out on millions of dollars of revenue over the life of the mine, and it would have little say on how GTAC is to proceed.

Russo upped his rhetoric when asked what will happen if the mine is approved in Ashland County. He says there would be blood.

“… It would be bad. There is so much animosity against this mine, I wouldn’t want to predict what would happen, but it would be scary,” he said.

“There will be violence, I’ll tell you that,” Russo said, adding that he has to “stay neutral.”