The federal government is extending its Nutrition North food subsidy program to Churchill until the Manitoba town's only land link to the outside world is restored.
The subarctic community of 900 on the western shore of Hudson Bay has been looking for help since the rail line into town was severely damaged by spring flooding.
The railway's owner, Denver-based Omnitrax, has said it will likely be next spring before repairs can be completed along the 280-kilometre section of track, and financial aid will be needed.
Without the rail line, goods and people have to be flown in to Churchill at a much higher cost.
Churchill Mayor Mike Spence said the food subsidy will help, but it's not clear how much it will lower prices.
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"There will be some cost relief to it, but we're still trying to figure out the program," Spence said.
Nutrition North is normally offered to fly-in communities and is aimed at offsetting a portion of the extra costs of shipping food by air. Each community's subsidy is based on factors including the population and distance from the nearest food distribution centre.
York Landing, another community in northeast Manitoba, has subsidies that vary from five cents to $1.40 per kilogram, depending on how perishable and nutritious each item is.
Rail line still priority: Mayor
Spence said while the federal aid is welcome, his real goal is to get the rail line fixed.
"Once we get the rail line up and running, all these other issues — whether it's propane, whether it's building material, whether it's food costs — go away."
Since the rail line was disrupted a month ago, Churchill businesses have seen many people cancel summer bookings.
The town must also find a way to keep homes heated with propane through the very long and cold winter. And while fuel can be brought up by ship during the brief ice-free season, there is limited storage in the town.
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The Manitoba government is considering bringing in extra propane storage units and converting some homes to electricity.
The province has also left the door open to helping Omnitrax pay for repairs to the rail line, but is awaiting an engineering report on how much the repairs will cost.