Municipal Board delves into RM, sand company zoning dispute
The RM of Springfield and Sio Silica Corp. squared off in Anola last week in the first two days of a three-day Municipal Board hearing that will determine whether the Calgary-based mining company was treated unfairly by the municipality when it was refused a zoning change needed to begin constructing a $100 million processing plant already licensed by the province.
Several area residents who oppose Sio’s plans to mine and process high-purity silica sand in the hamlet of Vivian used the hearing as an opportunity to convey environmental concerns directly to company executives.
Dan McInnis, acting chair of the Municipal Board, reminded public presenters that the hearing was focused on land-use and zoning issues. Environmental concerns surrounding Sio’s novel borehole extraction method will be assessed in a Manitoba Clean Environment Commission hearing early next year.
McInnis also reigned in lawyers for Sio and the RM, who were allowed to question presenters but not cross-examine them or make arguments. Both legal teams had prepared reams of supporting documentation for the Board to consider, and called upon experienced land-use planners to bolster their respective cases.
Remarks by several presenters suggested poor communication between Sio and the RM was a factor that led to the hearing, which was held last Wednesday and Thursday at the Anola Community Club. A third and final day of the hearing will take place Friday, Oct. 28 at 9 a.m.
After a deliberation period, the board will issue an order rejecting or confirming Sio’s appeal. The Board can impose terms and conditions, direct council to alter its zoning bylaw, or tell the two parties to reach a development agreement.
The timing of the hearing was doubly unusual, straddling a municipal election and occurring amid Springfield’s ongoing attempts to update its 12-year-old zoning bylaw. James Mercury, Sio’s lawyer, conceded the timing of the hearing was “rather unfortunate,” but said the company tried to postpone it with the consent of the RM.
The dispute that led to the hearing began in May, when Sio asked the RM to amend its zoning bylaw to create a new zoning district for its processing plant, which doesn’t fit neatly within any available zoning category. Council denied the amendment on June 23, and Sio appealed six days later, triggering a hearing that must be held within 120 days.
Feisal Somji, Sio’s chief executive officer, walked the Municipal Board through the company’s proposed operations in Manitoba.
Sio, formerly known as CanWhite Sands, bought land for the processing plant from a gravel company last year. The facility and related storage areas would sit on 25 acres near the intersection of Highway 15 and Provincial Road 302. Another 22 acres would be used to construct a rail loop for shipping processed sand to market.
Somji said Sio must finish building the plant by December 2024, under the terms of its Environment Act licence. Construction of the foundation and rail loop can’t be done in winter.
Somji said the plant would be a boon to the local and provincial economy, to the tune of millions of dollars per year, making it the largest economic development project ever proposed in Springfield.
Running at peak capacity, the plant would process 1.3 million tonnes of sand per year for 24 years. Somji said that’s nevertheless a small fraction of the total deposit underground.
“It’s probably in the top one percent of silica sand deposits in the world,” he said.
The company wants to sell the sand to companies that make batteries, solar panels, fiber optics, ceramics, touchscreen glass, and alloys for automotive and aviation parts.
Much of the hearing was taken up with the question of whether Sio needs a zoning bylaw amendment, or whether a conditional use permit would suffice.
Somji said the viability of a $100 million processing plant shouldn’t hinge on a conditional use permit that could be revoked by future council.
“It’s difficult to make such an investment when every four years you’re facing the possibility of being shut down,” he said.
Sio applied for a conditional use permit in June 2020, but the application never made it to a council vote. The RM said Sio submitted an incomplete application, then went silent.
“We were still waiting for some information. We never received the information,” Dan Doucet, the RM’s development officer, said at the hearing.
Somji said an opaque permitting process was to blame.
“We found that the process was not transparent,” Somji said. “We were essentially told that if we’d proceed we would be rejected, so we’d need to find another way around.”
Brent Bullen, Sio’s chief operating officer, said he didn’t understand why the RM was delaying the construction of a facility already licensed by the province.
“We’ve passed everything. We’ve passed everything that we were asked to do.”
Mercury, Sio’s lawyer, suggested Doucet wanted an unreasonable amount of supporting documentation from Sio, much of which was readily available in an online public registry.
Doucet maintained a conditional use permit was still an option for the company. He told the Board he had never seen one revoked in his 22 years with the RM.
“I think they want a conditional use without any conditions,” Doucet added.
Sio’s later application to create a new zoning district surprised Doucet, who had never seen such a request before. He consulted two land-use planners, who agreed the request should be denied.
Meagan Boles, a land-use planner with the consulting firm WSP, said at the hearing that it made no sense to amend a zoning bylaw that’s about to be replaced. She said a conditional use permit would suffice, calling the company’s request for a new zoning district “unnecessarily complicated and excessive.” She said new zones are typically initiated by municipalities, not landowners.
Mercury suggested Doucet didn’t make much of an effort to understand Sio’s request before recommending council deny it.
Planners who spoke in support of both sides at the hearing disagreed about whether it was fair for Springfield to have a zoning category with no permitted uses, meaning all development proposals in that zone require council approval.
John Wintrup, a land-use planner with the firm Wintrup+Richard who presented in support of Sio, said it was “odd” and “extremely limiting” to have no permitted uses in a zoning category.
“You don’t just draft a zoning district and have no permitted land uses.”
Investors in large, intense developments, like processing plants and inland grain terminals, find conditional use permits flimsy, Wintrup explained.
“You want some certainty that after you have your investment, that you’re allowed to be there for more than a few years.”
Wintrup argued the RM should approve the zoning amendment and attach enforceable “performance standards” that address any lingering concerns.
Wintrup also argued the RM’s new proposed zoning bylaw changed between first and second readings. Sio’s plant would have been automatically allowed under the first draft, but not under the version given second reading.
Doucet said the change was made to give council more control over gravel pits in the aggregate-rich RM.
Several new bits of information also surfaced during the hearing. While dispelling rumors about Sio’s investors, Somji revealed the CN Rail pension fund is Sio’s biggest shareholder.
Somji also said Sio divided its provincial licence applications for extraction and processing into two separate submissions on the advice of the Manitoba government.
“It was a recommendation made by them,” he said.
Critics of the company have accused it of trying to skirt regulatory due process by breaking their licensing applications into smaller parts that fall below regulatory thresholds.