- Highland Copper continues to seek state support to build a $425 million underground mine in the Upper Peninsula
- Two proposals for $50 million in subsidies are under consideration; one, a legislative grant, should be decided within 6 weeks.
- Opponents say either grant would be a poor use of taxpayer funding, but locals want the economic boost.
Rebuffed months ago, a Canadian company is renewing efforts to secure $50 million in taxpayer support for a $425 million copper mine in the shadow of the Porcupine Mountains in the Upper Peninsula.
Economic developers in spring 2024 awarded Highland Copper up to $50 million in a Strategic Site Readiness grant under the controversial Strategic Outreach and Attraction Reserve (SOAR) Fund. That funding remains stalled in the Legislature after questions from both Democrats and Republicans about the wisdom of the investment.
Now, the Legislature is expected by the end of September to decide on a second $50 million request that also would benefit Highland Copper, but go instead to the surrounding township for infrastructure improvements.
Related:
- Lawmakers try again to get $50M for controversial Copperwood mine in UP
- Michigan approves $50M for Upper Peninsula copper mine — but with conditions
- Michigan pauses $50M investment to bring back copper mining to Upper Peninsula
The new grant bid comes amid a surge of mining proposals in the UP to supply the transition to electric batteries. The request is among the biggest of a total of $3.4 billion sought by lawmakers in special earmarks.
Opponents of the measure, a grassroots group known as Protect the Porkies recently traveled to Lansing to lobby against the proposal, saying it poses too much of an environmental risk. The group has collected about a half-million signatures opposing the project.
Here’s a primer on the controversy:
Public investment or welfare?
The new grant of $50 million would be awarded to Wakefield Township in Gogebic County. The previous appropriation, which is stuck in committee, would have gone directly to Highland Copper for the project that is expected to create 380 jobs.
Rep. Greg Markkanen, R-Hancock, is pushing the new grant, which would pay for road, power grid and telecommunications upgrades.
“There is more than $100 million in infrastructure work to be completed,” Markkanen said in his request. “A public investment toward upgrades in the area will ensure private capital is attracted to the area to complete the remaining infrastructure work.”
The award would differ in impact to the company because “you can’t take the $50 million off our construction cost,” Mike Foley, Copperwood site manager for Highland Copper, told Bridge.
However, he added, “it sends a very important message to the investment community that the state of Michigan is supporting this project.”
Tom Grotewohl of Protect the Porkies calls the request “a highly disingenuous proposal which seeks to disguise corporate welfare as community infrastructure.”
“The purpose of this proposal is exactly the same as before: to use taxpayer dollars to accelerate and enable an inexperienced, foreign company’s first ever mine in the worst spot imaginable,” he added.
Pro: The region needs jobs
Wakefield Township Supervisor Mandy Lake told Bridge that she hopes Copperwood opens, but the $50 million legislative grant under consideration would not belong to Highland Copper “because they’re not receiving the money. We’re receiving the money.”
Twenty-two local governments have signed on in support of the project, and Lake said the region desperately needs jobs. The unemployment of Ontonagon (8.4%) and Gogebic (6.8%) counties near the proposed mine are significantly higher than the state rate of 5.3%.
“We sometimes feel like we’ve been forgotten about over here, because we don’t receive a lot of money,” Lake said of UP communities.
Jobs created by Copperwood would pay $80,000 to $120,000 per year, for a projected annual payroll of $45.6 million per year. Rep. Dave Prestin, R-Cedar River, said during a July 30 hearing that the UP needs “bold investment.”
The township hopes the money will aid development of its industrial park, now home to plastics manufacturer Westfall Technik and the western UP recycling center. Logging companies also use the area as staging areas.
The 13 or so miles of road eyed for upgrades, she said, are “just falling apart.” Upgrades would aid travel to surrounding areas for workforce transportation and to increase tourism, she said.
Con: Risky investment
The project faces fierce opposition from nearby residents and statewide environmentalists, who met with lawmakers in July to argue the potential risks of the project are far too great.
“(Mining) creates enormous environmental hazards,” said Alexandra Leonard of Protect the Porkies.
Grotewohl of the group, said it’s unfair “to ask Michiganders to pay out of pocket to enable a foreign-owned mine, right next to the Porcupine Mountains — our most cherished state park — with waste to be stored upstream from Lake Superior.”
With the exception of the UP lawmakers, “every single office we visited was at least receptive to our concerns,” Grotewohl told Bridge about the trip. “Many lawmakers confirmed their stance against it … Even those who could not commit were clearly intrigued by the information we presented.”
Opponents also cite cost concerns. Spending $50 million to create 380 jobs works out to about $132,000 per job.
In comparison, in the first half of this year, the state’s development arm — the Michigan Strategic Fund — awarded $21 million in tax breaks to 22 companies estimating that they’ll create 2,700 jobs. Payroll data was not available for all of them; the cost per job would be about $7,800.
The price of copper, while now a critical material, has bounced this year from $4 to $5.50 per pound. The mine has about 3.7 billion pounds of copper, according to the company.
“This is a commodity bet,” Sen. Thomas Albert, R-Lowell and former chair of the Senate Appropriations Committee, told Bridge this week. “That’s all this investment would be.”
He continued: “The problem with commodity bets is that they’re risky. It’s a global commodity. You don’t know where prices are going to go, because it’s based on global demand and global supply. … I don’t think it’s prudent to use taxpayer dollars to make a bet on commodity prices.”
What’s next
The project has a lot of competition for what could be a far smaller pool of money.
House Speaker Matt Hall, R-Richland Township, is calling for a cap of $100 million on the House grants, which are tied to this year’s unfinished budget.
There are different rules in the Senate. Senate Democrats have not committed to advance earmark disclosure in the budget process. Senate Republicans, meanwhile, launched a public website that lists their proposals. None so far address Copperwood.
Copperwood officials, meanwhile, are amid engineering and pre-construction work at the site and continuing to try to raise money for the mine. A decision on whether to proceed with the project is likely after March 2026.
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