Tire Recycling Corp. of Winkler will likely learn its fate in a court hearing this afternoon. The 14-year-old company, which processes about half of the province’s used tires, has been struggling to make ends meet for years, earning processing fees it says are about half as much as those paid in other provinces.

Paul Courteau, president of TRC, said the only way to save the company would be with an 11th-hour, $1 million loan from the province.

For many years, Courteau and Manitoba’s only other tire recycler, Reliable Tire Recycling of Winnipeg, have been pleading poverty, complaining about the low processing fees and payment schedules. Processors must pay for the delivery of tires to their sites, but are not paid for processing until the shredded rubber or processed rubber mat leaves the plant.

"The province has screwed us," Courteau said. "The province has known forever about these problems. Their responsibility is to pay the processor and they don’t want to pay."

TRC has racked up a growing debt and been unable to negotiate refinancing with conventional lenders because the tire recycling program has been in such disarray, Courteau said.

• Manitoba’s two tire processors handle a little more than one million tires a year.

• They are paid between $1.80 and $2.25 a tire, whereas in Saskatchewan processors are paid more than $3 a tire.

• Since the tire recycling program was started in Manitoba in the mid-’90s, a levy of $2.80 has been collected on the sale of all new tires for vehicles licensed for highway travel, generating annual revenues of just more than $2 million.

• There have never been levies applied to off-road tires like those used on farm equipment or other industrial vehicles in Manitoba. But earlier this decade, a decision was made to collect and process those used tires, even though no revenue was ever been generated from their original sale.

• The processing of off-road tires contributed to the virtual bankruptcy of the Manitoba Tire Recycling Board and necessitated an $800,000 bailout by the province in 2005.

• Levies have still not been raised, but a new industry-led organization has been established and a business plan has been submitted to the province that will see consumers pay increased levies when they buy tires, but not necessarily higher fees paid to processors.
 
In 2003 the province determined it would revamp the Manitoba Tire Stewardship Board which collects levies on new tire sales and pays processors to recycle the tires. But the board did not collect enough levies and ran out of money to pay processors. The province injected $800,000 into the system in 2005 and set up an industry-led organization to take over operation of the program.

The process has been in the works for a couple of years. The new group, Tire Stewardship Manitoba, submitted a business plan in the spring that has not yet been approved by the province. The plan calls for increased levies for consumers, but not necessarily increased fees for processors.

Brandi Wermie, general manager of Reliable Tire, said he sympathizes with TRC.

"It’s unfortunate," Wermie said, referring to TRC’s predicament. "The province has had an integral part in putting them where they are today… and us to a similar extent. This is more of the same thing we have been talking about for years and this is what it has led to. The government has sat on its ass for four years. I don’t know if this province really wants tire recycling."

But Laurie Strike, director of the pollution prevention branch of Manitoba Conservation, said the province is committed to keeping tire recycling going.

"But we recognize there are a number of issues that need to be dealt with (in relation to TRC)," she said.

Joel Lazer of Lazer Grant has been overseeing operations at TRC since a court application to have a receiver appointed was made on Sept. 14. It has not yet been made receiver and has not taken control of the operations.

The application was made by the Business Development Bank of Canada which is owed $147,00. TRC also owes Revenue Canada about $300,000 in payroll deductions and GST, and another $135,000 in provincial sales tax. TRC has also defaulted on a $600,000 provincial Grow Bond.