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Mining company’s missed payments impact small Iron Range town

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NASHWAUK, MN -- The small town of Nashwauk is dealing with a big problem surrounding an impressive body of ore.

It's commonly known as the Essar Steel site and it's seen years of financial trouble, a number of different owners, and it's still not operational.

"All we want in our community is for a good company, an operating company to come in, start the operation, and start mining and start new employment in our community," said Nashwauk Mayor Calvin Saari.

He has been running the city since November 2018.

"The residents of this community they're very interested because this city, I think it's future renewal and it's growth is dependent upon the operation of that mine."

Saari, a lifelong Iron Ranger and resident of Nashwauk for the past 30 years, though he would learn more about the Mesabi Metallics project once he was elected.

"Unfortunately as mayor, I know absolutely nothing."

And he said he's not alone.

"The lack of information that we've had as a council, they're very frustrated and losing hope."

According to Saari, they're losing hope and money.

"Mesabi Metallics has not even paid their last half taxes for 2019."

The mayor estimates that adds up to about 21 percent of the city's total levy.

"That is a significant hit on the city and that's something down the road, in the ensuing months, we're gonna have to address it in our operating budget."

"Our city is providing public utilities to that project and to that company. I just checked this morning and we are very grateful for the fact that they are at least paying their utility bill."

The company also owes the state of Minnesota.

According to the Minnesota DNR, Mesabi Metallics owed approximately $11.6 million in minimum royalty payments to the agency by January 20th.

That deadline has come and gone and the agency hasn't received its payment.

Jess Richards, Assistant Commissioner of the Minnesota DNR, said in a statement, that isn't the only deadline the company has missed.

"According to the DNR's mineral leases, Mesabi Metallics was required to complete construction of a pellet plant by the end of 2019. Mesabi missed this deadline and DNR now has up to one year to decide whether to terminate Mesabi's leases based on that default. At this point, we are not going to speculate on the timing of any lease decisions."

Richards added that the DNR remains committed to finding the right company to complete the project and that the agency is open to talking with any credible parties that can move the project forward.

Despite the obstacles, Mayor Saari remains optimistic about the future of Nashwauk.

"I'm very grateful we have legislators that are so supportive of us, we have support from the governors' office and we're just very hopeful that somehow we can put this package together in the very near future that we can begin this operation."

We tried to contact Mesabi Metallics but were not able to reach anyone at the company.

Kristen Vake

Anchor, Reporter

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