December 7, 2023 in Minnesota

From Mining Outpost to Tourist Destination: The Transformation of Ely, Minnesota

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Early History

Ely was founded in 1888 shortly after the discovery of iron ore in the Vermilion Range. The town was named after Samuel B. Ely who sponsored early explorations of the ore deposits in the area in 1882.

The Soudan Mine near Ely opened in 1884 and quickly led to rapid development of the town as a mining and logging community. Ely’s location on Shagawa Lake made it an ideal spot for transporting timber and ore. The Duluth and Iron Range Railroad reached Ely in 1888, further fueling the town’s growth.

An early pioneer and developer of Ely was Thomas Lee, an entrepreneur who established many businesses in support of the mining and logging industries. Other key founders of Ely included John Erickson and Scottish investor John Chisholm who financed many mining projects.

In the early years, Ely’s economy centered around mining and logging. The Pioneer Mine was a major early employer along with numerous sawmills processing the area’s abundant timber. Settlers were drawn to the developing town to work in the mines and forests. Ely was incorporated as a village in 1891 and as a city in 1894 shortly after the township was platted.

The nascent town faced challenges from fires in the 1890s, but continued to grow as mining and logging expanded. Early transportation networks like the railroad provided ways to export natural resources and supply goods to the remote location. Ely emerged in the late 1800s as a hub for northern Minnesota’s rich mineral deposits and forests.

Logging Industry

The logging industry was integral to the early development and growth of Ely, Minnesota. As the city was founded in 1888, logging operations quickly sprang up to take advantage of the area’s abundant natural resources. By the 1890s, logging had emerged as one of the predominant industries in Ely.

Several major logging companies set up operations in the Ely area in the late 19th and early 20th centuries. These included the Alger-Smith Lumber Company, Johnson-Wentworth Company, Merritt Brothers, and Shevlin-Carpenter Company among others. At their peak, these companies employed hundreds of loggers and operated dozens of logging camps in the forests surrounding Ely.

The rise of large-scale logging fueled economic expansion and population growth for Ely. The influx of logging companies offered ample employment opportunities for local residents as well as immigrants and settlers coming into the region. Logging income and commerce helped establish Ely as an early boomtown. The industry facilitated construction of roads, railroads, and other infrastructure to transport timber from Ely’s forests to markets across the country.

By the 1910s and 1920s, logging began to decline in the Ely area as most of the accessible timber stands were exhausted. However, the legacy of the logging industry continued to shape Ely’s economy and development for decades to come. Although no longer the dominant industry, forestry and wood products remained important to Ely throughout the 20th century.

Mining

The discovery and extraction of minerals had a significant impact on the growth and development of Ely. Iron ore and copper were two of the most important resources found in abundant quantities in the surrounding area.

The Soudan Underground Mine, located about 30 miles southwest of Ely, opened in 1882. For over 100 years, it was one of the area’s major producers of high-grade iron ore. Over its lifetime, the Soudan Mine extracted more than 40 million tons of iron ore. Operations went through multiple boom and bust cycles before permanently closing in 1962. During its peak years, the Soudan Mine alone employed over 1,000 workers.

In addition to iron, Ely hosted other important mines. The Pioneer Mine produced copper and nickel starting from 1899. The Chandler Mine and the Zenith Mine were two other major copper and zinc operations located just outside Ely. Together, Ely’s network of mines drove rapid population growth in the city during the late 19th and early 20th century by attracting miners, engineers, and other workers to the region.

The wealth generated by Ely’s mines supported the development of infrastructure, businesses, and civic institutions that paved the way for the city’s evolution into a established regional hub. Though active mining has ceased, the mining era remains an integral part of Ely’s economic, cultural, and historical identity.

Geography and Climate

Ely is located in northeastern Minnesota, in the Arrowhead Region of the state. The city lies within Lake County, on the southern edge of the Boundary Waters Canoe Area Wilderness (BWCA).

The town sits on Shagawa Lake and was established near the entry point to the rich iron ore deposits in the Vermilion Range. The surrounding geography is marked by thick forests, wetlands, lakes, and rocky outcroppings.

The continental climate brings very cold winters and warm, humid summers to Ely. The average high temperature in July is around 80°F, while the average low temperature in January is -10°F. Annual snowfall averages over 70 inches due to its proximity to Lake Superior. Spring and fall are brief transitional seasons.

The pristine wilderness surrounding Ely provides ample opportunities for outdoor recreation and tourism. The region contains over 1,000 lakes and streams as well as boreal forests. Wildlife includes moose, deer, wolves, bears, and many bird species. The local geography has shaped the culture and economy of Ely over time.

Demographics

Ely has experienced population fluctuations over the past century, with periods of growth and decline. In 1930, the city reached its peak population of around 6,000 residents during the mining boom. However, the population declined after the mines closed, dropping to just over 3,400 residents by 1960.

In recent decades, Ely’s population has hovered around 3,500 residents. As of the 2020 census, the population was 3,460. This represents a slight increase from 3,390 residents recorded in the 2010 census. Ely has an aging population, with a median age of 43.5 years old according to 2020 census data.

The racial and ethnic makeup of Ely is predominantly white, with 90% of residents identifying as white alone in 2020 census data. Just 3% of residents identify as Native American, 1.4% as Hispanic or Latino, 1.2% as two or more races, and less than 1% as Black or Asian.

Ely has a lower median household income compared to national averages. The median household income was $45,294 according to 2020 census data, significantly less than the national median of $67,521. Nearly 18% of residents live below the poverty line. In terms of education, 91% of residents have a high school degree and 17% have a bachelor’s degree or higher. The city has struggled with educated young people leaving for opportunities in larger metropolitan areas.

Government and Politics

Ely’s city government is structured as a statutory city governed by a mayor and city council. The government has evolved over time since Ely’s founding. The city passed a home rule charter in 1989, which organized the city government into the current mayor-council system. Since then, the city’s mission has been to provide residents with efficient, cost-effective government services.

Key developments in Ely’s political history include wrestling with labor unrest in the early 20th century as the mining industry grew. More recently, the city has grappled with the economic decline of the iron mining industry. This has led to efforts to diversify the economy through tourism centered around Ely’s natural beauty and Boundary Waters wilderness recreation. The city has also worked to support the mining industry during downturns. Ongoing political issues include balancing environmental protection of the surrounding wilderness with local economic needs.

Mayors and city council members have worked to address these issues over the years to chart a viable path forward for Ely. Collaboration with state and federal partners has been necessary to navigate the interconnected economic and environmental concerns. Overall, Ely has evolved gradually over the past century to have a resilient, functional local government able to serve citizens’ needs.

Culture and Recreation

Ely is home to numerous cultural institutions and events that showcase the city’s history and natural surroundings. The Ely Arts & Heritage Center features a gallery, theater, and historic exhibits that highlight the culture of Ely’s pioneering families and the Ojibwe people.

The annual Blueberry Festival held in July offers live music, craft vendors, food, and family activities celebrating Ely’s natural bounty. In August, the popular Harvest Moon Festival provides music, entertainment, contests, and merchandise vendors spread throughout the downtown.

Outdoor recreation abounds in the Boundary Waters Canoe Area Wilderness just outside Ely. Rock climbing, hiking, camping, fishing, canoeing, kayaking, and wildlife viewing draw outdoor enthusiasts. Outfitters in town provide rentals, supplies, and guided tours of the BWCAW. The International Wolf Center educates visitors about wolves and conservation.

Winter activities include cross-country skiing on the hundreds of miles of trails, snowshoeing, dogsledding, ice fishing, and snowmobiling on the groomed Taconite State Trail.

Ely takes advantage of its natural assets to attract tourists to its resorts, restaurants, shops, and attractions. The tourism industry plays a significant role in the local economy.

Education

Ely’s first school was founded in 1888 when a crude log structure was built to serve as a schoolhouse. The curriculum focused on reading, writing, and arithmetic. In 1907 a new brick schoolhouse opened, with four large rooms that could accommodate over 100 students. This school marked an expansion of educational opportunities in Ely.

Key developments in Ely’s schools over the decades included the introduction of a high school curriculum in 1914 and the construction of Memorial High School in 1936. Extracurricular activities such as sports teams, music programs, and clubs were added over time. During the 1950s and 60s, Ely’s school district continued to grow, requiring the building of two new elementary schools and additions to the high school.

The Ely school district today operates three K-4 elementary schools, one 5-8 middle school, one 9-12 high school, and an alternative learning center. With over 1,200 students, the district offers diverse academic programs and extensive extracurricular opportunities. The schools continue to play a central role in the Ely community.

Transportation

Ely’s early transportation history was dominated by railroads. The Duluth and Iron Range Railroad first arrived in Ely in 1888, connecting the city with Two Harbors and Duluth. This allowed the shipping of iron ore from the nearby mines. In 1903, the Duluth, Missabe and Northern Railway also reached Ely, further expanding railroad access.

For decades, Ely was reliant on railroads for transportation and shipping. Roads were primitive. This began to change in the 1920s as state highways were constructed through the area. In 1926, trucks began hauling iron ore, challenging the railroad dominance.

Major highway routes accessing Ely today include Minnesota State Highway 1, Highway 169, and Highway 21. While no longer having passenger rail service, Ely remains an important freight rail center.

Ely’s municipal airport opened in 1956. Originally having a 1,850-foot gravel runway, it was expanded and paved in the 1960s. Today Ely’s airport has a 4,000 foot asphalt runway and provides daily commercial flights. The airport serves private planes and air ambulance services in addition to commercial aviation.

Over time, transportation options have diversified in Ely. While railroads opened the area to development, highways and aviation now provide vital access. Yet the railroads still carry bulk freight, reflecting Ely’s origins.

Contemporary Ely

Ely today continues to rely heavily on natural resource industries, with tourism and mining being the major employers in the area. However, the town faces several challenges moving into the future.

The Boundary Waters Canoe Area Wilderness is a major draw for outdoor enthusiasts from around the world. Tourism related to lodging, outfitting, dining, and retail attracts over 250,000 visitors annually. However, a decline in mining has led to a shrinking population and tax base over the past few decades. Major mines have closed, and efforts to open new mines have stalled due to environmental concerns.

Providing quality education and opportunities for young people is an ongoing issue, as the population trends older. Recent investments in schools, healthcare, recreational facilities, and infrastructure aim to make Ely an attractive place for families to live and work. High-speed internet access has also been a focus to support remote workers and connect residents across the rural community.

Looking ahead, community leaders hope to diversify the economy beyond mining and tourism. Attracting and retaining skilled workers will be key to sustaining a vibrant local business community. Promoting Ely’s natural beauty, small town charm, and community spirit may draw new residents interested in an active, outdoor-oriented lifestyle. Partnerships with higher education, continued investment in amenities, and policies that balance economic and environmental priorities will shape Ely’s future.




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