By Andru McCracken

McBride Forest Industries filed a proposal to its creditors on Thursday, and according to trustee Martin Hyatt of the Bowra Group, the proposal is to pay the creditors what they are owed with the money from the sale of the mill’s forest license.

Whether or not there is enough money to pay all creditors in full, remains unknown at this point.

Hyatt said that federal taxes could eat up 34.1% of the total sale price of the forest license, roughly $5.5 million. There are also potential environmental issues on the mill site, which would also have priority over creditors.

“We have to set a meeting to review the proposal and vote on it. We will send out notices to creditors when the meeting is going to be,” he said.

“There are two major uncertainties. What environmental liability is attached to the assets and what is the ultimate tax liability for the company, because the sale of the license by itself is a taxable event. If you did nothing else all year but sell that, you would have to pay $5.5 million in taxes to our good friends in Ottawa,” he said.

“That is a mighty big chunk to take out of the proceeds.”

“If there was no claim from Carrier and certain other things happened that would reduce that tax liability, then the creditors could well get paid in full,” he said. “As we go through this thing, those uncertainties will be reduced.”

He said that the meeting would likely occur during the week of June 11.

Kordyban said that his company has dropped a previous appeal of a judge’s decision to deny them the sale of the forest license for $6.9 million. However, there could be other lawsuits.

“Until everything gets settled up, I can’t comment on that too much. There might be other litigation,” said Kordyban. “We have to look at that.”

He said that the transfer of ownership of the license is before the Ministry of Forests now.

“That’s the only hurdle there really is,” he said.

Kordyban said that he would combine McBride’s forest license with Valemount’s to supply Valemount Forest Products.

Kordyban said there is no formal log sharing agreement with McBride’s veneer mill, though he didn’t rule out sales to the mill if it should reopen in the future. “Business is business. There is nothing to say we wouldn’t sit down with the owners of McBride and see if we could work something out,” he said.

Mayor Mike Frazier said that he’d like to see the wood stay closer to home.

“It’s an unfortunate situation that Carrier couldn’t see a way clear to take MFI over and run it too, or at the very least bring in a portable mill to make good use of the yard and the work force,” said Frazier.

“They have the cutting permit. They can take the wood where they like. Of course we hate to see the fibre leaving the area, but what can we do about it.”

Frazier said it’s too early to comment on the possible purchase of McBride Forest Industries’ veneer mill by the village or community forest.

“I don’t think the owners have hung a price tag on it. We don’t know what the actual assets and liabilities are yet.”