2010 Legislative Session: Second Session, 39th Parliament

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

MINUTES AND HANSARD

MINUTES SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

Wednesday, September 22, 2010

9 a.m.

Zinfandel Room

Penticton Lakeside Resort, Penticton, B.C.

Present: John Les, MLA (Chair); Doug Donaldson, MLA (Deputy Chair); Norm Letnick, MLA; Don McRae, MLA; Michelle Mungall, MLA; Bruce Ralston, MLA; Bill Routley, MLA; John Rustad, MLA; Jane Thornthwaite, MLA; John van Dongen, MLA

1. The Chair called the Committee to order at 8:59 a.m.

2. Opening statements by John Les, MLA, Chair.

3. The following witnesses appeared before the Committee and answered questions:

4. The Committee adjourned at 11:58 a.m. to the call of the Chair.

The following electronic version is for informational purposes only.

The printed version remains the official version.

REPORT OF PROCEEDINGS
(Hansard)

select standing committee on
Finance and Government Services

Wednesday, September 22, 2010

Issue No. 23

ISSN 1499-4178

[ Page 657 ]

WEDNESDAY, SEPTEMBER 22, 2010

The committee met at 8:59 a.m.

[J. Les in the chair.]

J. Les (Chair): Good morning, everyone. We'll get the show on the road. My name is John Les. I'm the MLA for Chilliwack and the Chair of this parliamentary committee. I'd like to welcome everyone here this morning.

Each year in preparation for the upcoming year's budget, the Minister of Finance releases a consultation paper on the budget by September 15. That paper presents a current fiscal forecast and identifies the key issues that need to be addressed in the next budget. The paper provides a focus for the consultations of this committee, and it includes information on how members of the public may provide their views on budget priorities.

Printed copies of the consultation paper are available at the back of the room. The select standing committee here this morning is the parliamentary committee which is responsible for conducting public consultations on the forthcoming provincial budget.

[0900]

Our committee is required to report back to the Legislative Assembly no later than November 15 of this year. We are going to be holding 14 public hearings in total, in each region of the province. We've also scheduled three video conferencing sessions to hear from residents of the more rural communities of the province — the second time that we have done this.

This week we met yesterday in Lake Country, today in Penticton and Kamloops, tomorrow in Cranbrook and Castlegar and then Friday in Victoria. Last week we met in Vancouver and Surrey.

In addition to public hearings, there are a variety of other ways that British Columbians can share their ideas with us. We accept written submissions by letter or e-mail and also video and audio files. Further information on how people may participate using one of these methods is available on our website.

Committee members carefully consider all of the public input that we receive, whether it's oral or any other way. The deadline to receive submissions is Friday, October 15.

At today's meeting each presenter speaks for ten minutes, with up to an additional five minutes allowed for member's questions. Time permitting, there is also an open-mike session near the end of the hearing with five minutes for each presenter.

Today's meeting is a public meeting. It'll be recorded and transcribed by Hansard Services. A copy of this transcript, along with the minutes of the meeting, will be printed and made available on the committees website at www.leg.bc.ca/cmt.

In addition to the meeting transcript, a live audio webcast of this meeting is also produced and available on the committees website to enable those who are interested to hear the proceedings as they occur. An archived copy of the audio broadcast will also be retained on the committees website.

At this time I'll ask members of the Finance Committee to introduce themselves, starting with John van Dongen.

J. van Dongen: John van Dongen, MLA for Abbotsford South.

J. Thornthwaite: Jane Thornthwaite, North Vancouver–Seymour.

J. Rustad: John Rustad, MLA for Nechako Lakes.

D. McRae: Don McRae, MLA, Comox Valley.

N. Letnick: Norm Letnick, MLA, Kelowna–Lake Country.

D. Donaldson (Deputy Chair): Doug Donaldson. I'm MLA for Stikine in the northwest part of the province and Deputy Chair of the committee.

B. Ralston: Bruce Ralston, Surrey-Whalley.

M. Mungall: Michelle Mungall, Nelson-Creston.

B. Routley: Bill Routley, MLA for Cowichan Valley.

J. Les (Chair): Also with us today, to my immediate right, is our Committee Clerk, Susan Sourial. Assisting us as well is Byron Plant, who is staffing the registration desk, and Hansard Services staff, Michael Baer and Jean Medland, who are recording and preparing the written transcript of this meeting.

With that, we are ready for our first witnesses, who are from Okanagan College — Lance Kayfish and Allan Coyle.

Good morning, gentlemen.

Presentations

L. Kayfish: Good morning. Thank you very much for having us here today. Welcome to Penticton on this beautiful, sunny day.

Let me please take a moment to express the cloud of sorrow that I feel, and our whole college community, at the passing of Sindi Hawkins, a former MLA for Kelowna-Mission. Sindi was a great friend to the college and the whole region. She's going to be very dearly missed. I know she was a personal friend to many of you.

It is our privilege to be here today with the opportunity to add our voice and perspective on the important
[ Page 658 ]
question of how and where government should be investing its resources. As we recover from the recession, now is the time to be making those decisions to facilitate a fast recovery and position ourselves for stability and strength.

The government has already recognized that education is part of that plan. B.C. has declared its intention to be the best-educated, most literate jurisdiction in the continent. As the largest college on this side of the Lower Mainland, we are well positioned to help. Last year more than 20,000 people took courses and programs with us. That's about one out of every 20 people in our region that has a population of approximately 400,000.

This fall the number of students attending our institution has increased by approximately 6 percent. We have grown by 65 percent in the last five years, outperforming government targets each year and providing more student spaces than we have been funded for. We are bigger now than OUC was before the split to become Okanagan College and UBCO.

A number of programs have been added to each of our four major campuses, ranging from human kinetics, environmental studies, criminal and social justice to home inspection certification and a host of new trades programs.

I'm also very pleased to report that the number of aboriginal students we serve has grown too. More than 1,000 attended Okanagan College last year. That's an increase of 18 percent over the year before and almost double the number who came to our college in 2007-2008. It's heartening to see that we are making progress on the strategic goal that we share with the province — something we are and will continue to work hard at.

[0905]

All of this is about access that involves more than simply introducing new programs. It involves making sure programs are offered where people can take them without having to move or give up family and social networks, which is vitally important to many of the learners the colleges serve.

However, we deliver the quality that can also make us a learning destination. Our students and graduates will attest to the quality of our education, whether they are leading B.C.'s third-largest credit union — that would be Launi Skinner, CEO of First West Credit Union and former president of Starbucks U.S.A. — or being recognized as Kelowna's young entrepreneurs of the year — such as Todd and Mark Regier, proprietors of Prestige Collision.

I'm sure MLA Norm Letnick, with us here today — college business professor also, currently on leave — would gladly tell you how great our business students are, given that he has led some of them to international distinction in competitions.

We recognize some of our growth may be attributable in part to more than our great reputation, though, and that the economic downturn we're emerging from has had a role to play as well — although I would note that Okanagan College grew significantly even during the boom years prior to the fall of 2008.

In our role in the region, we're acutely aware there's another factor at work here, one that's vitally important to consider, and that's the transition rates of students from secondary to post-secondary. The bright side of the story is that we have the fastest increase in transition rates in the province. The not-so-shiny part of the story is that despite that growth, we still have one of the lowest transition rates in B.C.

About 42 percent of high school graduates in our region transition immediately to post-secondary. The average for the province is 52 percent. That means there are still many people in our region who finish high school but don't go on. If we are to achieve the goal of best-educated jurisdiction in the continent, we are going to have to work to close that gap in the Interior, and that's an opportunity.

There's good reason to be ambitious in this matter. We are still facing the proverbial silver tsunami we hear so much about of baby boomers retiring. The skill shortage that we wrestled with before the fall of 2008 has not gone away.

I'm going to take a moment to give you a few numbers. The Conference Board of Canada has predicted a shortage of 160,000 employees in B.C. by 2015. A report published in March of this year says that there will be a workforce shortfall in Canada of 1.5 million people by 2021, escalating to 2.7 million by 2031. What's more significant from our perspective is that most of those jobs that will be available will require some form of post-secondary education. Estimates range between 70 and 80 percent, and most of the skills and training that those people will need will come from college-provided programs and courses — some citing 6 to 1, colleges over universities.

We need to provide the access to that higher learning and to support improvements in transition rates, especially in regions such as ours and among traditionally under-represented groups, such as aboriginal students. We have an opportunity that we need to take advantage of.

Okanagan College has found the means to cope with growth, funded and unfunded, and respond to the pressures felt throughout the province to do more with less, but we ought to be aware of the warning signs that this is a course we can't pursue. There are would-be students on waiting lists to become practical nurses, dental assistants or civil engineering technologists because we don't have the capacity to accommodate them. We are working with our region's school districts to improve transition rates. We need to follow through with post-secondary seats, programs and facilities that will prepare them for their careers.
[ Page 659 ]

We will work closely with employers, industry organizations, the communities we serve and other institutions to leverage government investment. Okanagan College, for example, is working with a host of other institutions to develop program opportunities for students in this region. We are working with UBC Okanagan, for instance, to develop additional capacity to educate registered nurses, to create links where engineering technologists can move into engineering degree programs, and we have a new affiliation agreement with the En'owkin Centre to help develop new opportunities for First Nations and non-native students.

We have a successful program with Northern Lights College that allows students to complete part of their aircraft maintenance engineering program in Vernon. We're linked with Selkirk College, College of the Rockies and Thompson Rivers University to cooperate in program and service delivery.

We are also a driving force in a new consortium that links leading colleges across the country to share curriculum and research on green building technologies — something that will help position Okanagan College, the centre of excellence under construction here currently in Penticton, and B.C. as world leaders in sustainable building technologies.

[0910]

Economic impact studies tell us that every dollar of taxes invested in B.C. colleges returns about $3.80 to the province and local governments. Educated and trained alumni provide very real benefits to taxpayers in terms of reduced spending on health care, unemployment and other social benefits.

With all that as background, Mr. Chair, our advice to your committee is: first, continue to recognize colleges as a vital investment to help realize provincial goals. We need nurses, care aides, technicians and therapist assistants who can answer health care challenges. We will need plumbers, welders, managers, hospitality staff, technologists and border officers, which colleges educate and train.

Recognize that access close to home, including to the first years of university education that colleges provide, is vitally important for those who have to retool in a changing economy.

I'll stress that the government needs to anticipate and respond to the demand for post-secondary education with increased investment. The skill shortage is not going away. In return, expect organizations such as ourselves to find ways to maximize return on investment, which comes from both students and government.

Colleges have demonstrated the capacity and drive to develop the partnerships, innovation and employer connections that add value for students and that contribute to the economic well-being and diversification of our communities.

Second, the province needs to work with the sector to cooperatively develop policies and measures that will assure quality, return on investment and help build the sector. We have demonstrated flexibility to respond to rapidly changing needs. We're committed to working with government, so that things like accounting policies do not stand in the way of student interests, and to also enable provincial objectives such as transparency and sustainability.

Third and finally, perhaps when things get a little bit brighter economically, we'd encourage you to consider creating a matching fund for this province's post-secondary institutions to enable and enhance our fundraising abilities. Alberta's $3 billion endowment in Access to the Future has given colleges and universities in that province an ability to leverage community and donor support to make government investment go further and to make giving more attractive for potential donors.

Since 2006 Alberta's post-sec institutions have been able to use $127 million to help convince donors to support their activities and building programs. Given that we are in the middle of a $5 million fundraising campaign for the centre of excellence here in Penticton, I know this kind of program would be an advantage in our discussions with donors and potential donors that support us so generously.

With that, Mr. Chair, I'd like to thank you and the committee members for taking the time to listen. I'd be more than happy to answer any questions you might have. I have Allan Coyle, our director of public affairs, here to assist me with any questions you might have.

J. Les (Chair): Thank you very much, Lance.

N. Letnick: Thank you, Lance, for your presentation. Please pass on my thanks and congratulations to the board of governors and all the staff at OC for doing a great job in our community.

We heard yesterday from representatives from UBCO students concerning access to education, particularly tuition fees. I'm looking at your second-to-last page: "Statement of revenues and expenses." It shows that at Okanagan College tuition makes up 17.8 percent of income to fund the programs. Is that higher or lower than the trend in college, for OC, and is that higher or lower than the university is?

L. Kayfish: I can answer the first part of that question, and I'll defer to Allan. He might have to answer the second part. I think in terms of comparison, in terms of the revenue of overall operations we are right on par with and in very close parameters to all the other colleges in British Columbia. I can't answer off the top of my head exactly how we stack up to universities.

Tuition costs do vary across the province from institution to institution. We've actually taken, at Okanagan College, I think a very progressive approach to tuition on an ongoing basis. We've instituted a tuition policy
[ Page 660 ]
which actually puts us in the direction of adjusting our tuition on a comparative basis to other institutions to make sure of fairness and equity for the students here in the Okanagan.

B. Ralston: Two questions. The first one would be: yesterday we heard from a society in Kelowna which concentrates on providing basic literacy skills to people, and they particularly identified people who don't have sufficient skills to even enter a preapprenticeship program, so I'm wondering whether you offer at the college adult basic education. That's the first question.

[0915]

I suppose the subquestion of that is: do you work with this society, and what relationship is there between you and this society in terms of preparing potential applicants for preapprenticeship programs?

The other question would be, just to get a sense of…. Colleges, prior to some of them being transformed, at least in name, to universities, did have a section of students who were focused on university transfer. So I'm wondering what percentage of your student population is enrolled in what would be traditionally described as university transfer programs now, and how does that work with your relationship with University of British Columbia Okanagan?

L. Kayfish: I think the director of public affairs can answer more of the question than I can. I can say that we do offer an adult basic education program at a number of locations throughout the Okanagan Valley, and I also know that we've had significant growth in that area. If I'm not mistaken, there are some areas where we are at capacity in those programs. I'll let Allan address the issue of the connection with that specific group.

A. Coyle: Well, Lance is right. First of all, we do offer a very ambitious program of adult basic education throughout our four campuses. It's been growing dramatically over the past few years.

In addition to the adult basic education program, we also offer a host of other programs that are intended to help those people with barriers to access the trades specifically. A couple of those are our women in trades program and an aboriginal gateway to the trades program. So some of those people will be introduced to the opportunities for trades but then also steered towards the adult basic education programs.

We work closely with Project Literacy and others. I know some of our staff and employees actually volunteer with Project Literacy.

I'm forgetting the rest of the questions at this point. The percentage of university transfer. We have seen dramatic growth in our arts transfer programs, partially because we've introduced a number of two-year diploma programs that students can also use to ladder into university. We have almost as many students coming from UBC Okanagan to Okanagan College as we have coming from Okanagan College to UBC Okanagan. It's an interesting statistic that we discovered this year from some transitions data.

Probably about a third of our program FTE count is in university transfer. If you considered our degree programs — business being one of the two degree programs we have — it would probably be approaching half, I would guess.

J. van Dongen: You use the term "transition rate" from high school to post-secondary. A great presentation, by the way. Is that the same as participation rate?

Then the second part of my question is: why do you think your rates are lower than average in British Columbia, and how do you go about remedying that? Is the average in British Columbia sort of the ideal target figure, or does it reflect other factors in your market area, so to speak?

L. Kayfish: Both of those are very good questions. In terms of transition rate and participation rate, if I'm not mistaken, the participation rate is more based on the whole population base and what that percentage is, and transition is specifically from high school to post-secondary.

One of the things that we always think about when we talk about that terminology is that it typically measures high school students going directly into post-secondary education. But we know that we serve a much broader community of learners — people coming back as students and different types of lifelong learners.

J. van Dongen: So on the issue of definition, the principle is the same, but they're actually two distinct, different definitions. One is looking at the percentage of the total population, and the other is looking at the percentage of high school students going immediately into…. Okay.

Maybe the second half of my question, then — if you could comment on that.

L. Kayfish: There is a variety of reasons for why the transition rates might be where they are. There's been a lot of speculation, and we certainly discuss it internally a great deal, because we like to consider ourselves market-driven and figure out where the demand is coming from. The reason the transition rates may be lower here, I think, is probably for a lot of reasons. One of the big ones is traditionally this region…. History has a lot to do with what students do in terms of their family backgrounds. If their mother and father went to post-secondary, a person is more likely to go on. So in this region you see less tradition of a post-secondary education.

[0920]

There's also a very strong agricultural influence. Agriculture traditional family lifestyles are slightly dif-
[ Page 661 ]
ferent, although that is certainly an opportunity for us going forward in terms of increasing that. That part of the economy is continuing to change, so there is a lot of opportunity there.

J. van Dongen: Could it also reflect patterns of in-migration by adults and maybe a somewhat lower percentage of, say, children in the population that might be coming through the K-to-12 system?

A. Coyle: I think on a participation rate, that could certainly be a factor, but on a transition rate to post-secondary from secondary, that wouldn't be the case necessarily. I think that you're right, Mr. van Dongen, in terms of drawing an equation between participation and transition rates, because where there isn't a history of people attending post-secondary, their children are less likely to go. So we've been working very closely with the school districts of our region to establish new pathways for students and new opportunities and to develop a better sense of the importance of post-secondary for students in the region.

L. Kayfish: I think the one other factor I'd just quickly note is also proximity and access to post-secondary education. We serve, as the Okanagan College, a very broad region, pretty much from Revelstoke to the U.S. border. We're constantly working on creating new entry points for students and responding to economic developments — new mines opening up in the region and those sorts of things — and understanding what impact that's going to have and how we're going to serve it. But in areas where there's more densely located access to post-secondary education, there's certainly an advantage there for students in those regions.

D. Donaldson (Deputy Chair): Thanks for your presentation. I congratulate you on the increased growth rate. That's quite amazing over the last five years and especially in the First Nations population. Those are excellent stats.

I've got a question about access. On page 2 you've said, "More student spaces than we have been funded for," for example. I just want to know the impact of that. You mention, on page 7, wait-lists, but what are some of the other consequences of having more spaces than you're funded for?

L. Kayfish: The consequences of having more…. I think you just run up into those capacity issues much sooner. We have a great leadership team and executive staff at the college.

I know that as a board we ask ourselves that same question. We don't want to be in a position where we're either overextending ourselves or eroding quality, but I think it's fair to say that as an institution we're probably on the cutting edge of program costing in our sector and getting into some of the minutiae detail of, really, what it costs on a program-by-program, class-by-class basis to educate our students. So we take whatever flexibility we have, and we turn it into access because we have a mandate of not wanting to turn students away.

We struggle from year to year with different programs where there's been one-time funding granted for certain programs. We've had that recently in some of our health care areas, where we've had the one-time funding available to us. At the point where the one-time funding ceases to flow into us, we still have the demand there for those programs, so we really struggle with it because we're hearing regionally that there's a need for those programs. Nursing assistants, I think, is one we dealt with recently.

But we have to make some changes because we also know that organizationally, in terms of things that we have to do in terms of staffing and facilities and whatnot, we have to plan for the future. You can only push the limit so far before you have to start applying to reduce the resources you're putting towards programs or be caught in a position where you just don't have the resources.

M. Mungall: I have a couple of questions — not necessarily related, though. The first one is about the women in trades program. One of the things I hear from a lot of women who have completed women in trades programs is the difficulty in attaining jobs post-graduation in their field of study. So I'm wondering if you have any stats on the job attainment rate for your graduates from the women in trades program, and if they're doing any type of programming that supports women getting actual, paid work once they've completed the program.

Then my second question is about the general accounting practices. I've heard from a lot of colleges throughout the province that the general accounting practices are very, very hard in terms of managing the budget, and it disallows for a lot of flexibility. So I'm wondering if you can comment on that as well.

[0925]

A. Coyle: On the women in trades program, it is primarily a gateway program to introduce women to the opportunities in the trades. That said, some of them will go out and seek apprenticeship, and we assist on that front. I believe we have statistics on the number of women from our program who move on to other programs and, I think, on to employment, so I'll try and dig those up for you.

M. Mungall: I'd really appreciate it, thank you.

A. Coyle: The one thing that we have done was we hosted a women-in-trades conference last year, which
[ Page 662 ]
was really interesting. We brought women in trades who were actually in the trades together with the students and the would-be students, along with industry representatives. It was an eye-opener for a lot of the women who were considering careers in trades. So we are establishing those networks that will help create job opportunities and give people the information they need to find work.

L. Kayfish: In terms of the second question with respect to accounting practices, we encourage government to do whatever it takes to be innovative and make sure that all the provincial sort of global needs are met when it comes to those sorts of things — debt management, all sorts of issues that we understand that government has to deal with that we, as a college, don't have to deal with.

There were a couple of things that happened last year, and we were very encouraged, working with the ministry and working with government, that we were able to resolve all the issues that we had at Okanagan College. We were heartened to hear in the throne speech the promise of…. I think the language was that accounting policies ought not to interfere with student interests and that commitment from government.

So we just want to take the opportunity to send the message that we have great staff. You know, when I think of Bobby Eby, who is our VP of finance at Okanagan College, he has a wonderful and tremendous understanding of the inner workings of all the finances and the ways different accounting changes in practice might influence the way the college operates.

I just encourage government to draw on the experience of people like that, so that we can make sure, as I said in the presentation, that we are able to do everything that we can to participate to meet government objectives. We believe in transparency and sustainability in everything we do, and we'd expect the same from government. Work with us.

J. Les (Chair): All right. With that, thank you very much for coming this morning — a very good presentation.

Our next presenter this morning is Bill Ross.

B. Ross: I have to apologize, Mr. Chairman. It looks like I may be a little bit underdressed. There was no dress code in my acknowledgment.

J. Les (Chair): Not to worry. The rest of us just wish we could dress like you have this morning.

B. Ross: As just a precursor to my presentation, in the folder there is an Oliver, B.C., map, and on the map I've circled the five roads in question, and you can see how they relate the Black Sage Road, which is going to be in my presentation.

J. Les (Chair): Whenever you are ready, Bill.

B. Ross: Mr. Chairman, committee members, thank you for this opportunity to appear before you. I will try to make my brief short and to the point. I will start with a little history. I'm from Oliver, the wine capital of Canada. My name is Bill Ross, and I also reside in the town of Oliver. I am the past president of the Boundary-Similkameen Liberal Riding Association.

We currently have 19 wineries and one more being constructed in 2010-11, which will bring the total to 20 wineries in the Oliver area. Three years ago the Ministry of Transportation resurfaced Black Sage Road, which has ten wineries on it. Black Sage Road is 12 kilometres long, and it cost $1.5 million. This road is located on the east side of the valley.

The reason I am appearing before you is to ask for funding for the roads on the west side of the valley. The roads involved would be Roads 7, 8, 11, 13 and 16. On these roads there are seven wineries, with one more being built by Mr. Don Triggs for a total of eight.

[0930]

The roads that I have listed are as follows for resurfacing. Road 7 is 0.355 kilometres long, and the cost is approximately $30,150; Road 8, length 1.248 kilometres, cost $112,320; Road 11, length 0.525 kilometres, cost $47,250; Road 13, length 1.469 kilometres, cost $132,210; and last but not least, Road 16, length 0.566 kilometres, cost $50,940; for a total of 4.163 kilometres at a cost of $372,870.

The cost I have is from a local paving company, Peters Bros., and the cost is approximately $90,000 per kilometre for resurfacing.

I know that paving comes with shouldering, widening, drainage, and I thought that if the province funds the resurfacing of this project, the road maintenance company, Argo Road Maintenance, could look after the widening, the shouldering and the drainage, which they would get paid for under the contract they have with the provincial government. I have maps and costing enclosed with this presentation.

I might suggest that if the province does decide to fund the resurfacing of the roads, it would be done under what is known as an H-200, which is an in-house work order with Argo Road Maintenance, which would eliminate the tendering process but would be supervised by the Ministry of Transportation as an option.

In closing, I'd like to thank the committee for hearing my presentation and for considering what effect the resurfacing will have on the agritourism industry in the Oliver area.

Respectfully submitted, William "Bill" Ross, past president, Boundary-Similkameen Liberal Riding Association.

In the maps that follow, and they're kind of crude, Mr. Chairman, I just wanted to accentuate Highway 97 and the roads for construction purposes. I put a cost and a length beside each road for reference purposes. I went
[ Page 663 ]
out yesterday and took some pictures, but I apologize, Mr. Chairman. I didn't put 15 of these together for this presentation, but I have two for the committee.

It outlines the roads involved, and it was to accentuate shoulder drop-off, alligating, alligating here, potholes, potholes, again potholes, potholes in complete deterioration, deterioration, potholes, deterioration. And this, on Road 13, is kind of a unique area. The South Okanagan lands irrigation district, which had a flume system in the South Okanagan, in this particular area they've put it underground into concrete reinforced piping, but it's very, very narrow. You can see my pickup here. There isn't room for another vehicle to pass. In the resurfacing, shouldering and widening, this would be one specific area.

This is Road 16 — again, the alligating and deterioration, potholing of the roads. This is a complete loss of road which occurred in the June 13 mudslide of Testalinden Creek.

I'm more than prepared to answer any questions, if you may have some.

J. Les (Chair): Okay, thank you, Bill. Are there any?

D. Donaldson (Deputy Chair): Thanks for that presentation on transportation infrastructure. I know it's an important part of what makes the province function.

I was curious. You've signed your submission as past president of the local Liberal riding association. Have you brought this matter up with your MLA, who I believe is John Slater?

B. Ross: I've talked to John Slater about it, and he has talked the Minister of Transportation in regards to the presentation. In fact, I talked to him this morning, and he specifically asked me to mention that to the committee.

[0935]

J. Rustad: Thanks, Bill, for the presentation. Having spent a little bit of time down in this area from job summers and going to visit some of these wineries, I have travelled pretty much all of the roads that you have talked about and suggested. I'm well aware of the situation of them. I'm curious, though. A lot of those roads are covered under the regional district, not under the municipality, if I'm correct.

B. Ross: You are.

J. Rustad: I'm wondering. The regional district — have they put a submission in, in terms of the amount of road work that needs to be done? Will they be visiting with the minister, along with the local MLA, at UBCM to reinforce the presentation that you're asking? I'm wondering, also, that if that has happened, what kind of reception they've received from the minister.

B. Ross: Those roads are in the rural area and do come under the RDOS. But the roads in question are under the auspices of the Ministry of Transportation. I know from a local standpoint — I do some work with the Ministry of Transportation — that it's not in their budget from a maintenance standpoint or through Argo Road Maintenance to resurface these. It pretty well has to be a capital cost, and a capital cost through the Ministry of Transportation.

J. Rustad: The point I'm trying to make is that to help the cause you're trying to do with these roads and the work that needs to be done, I think it would be good if you could get the regional district to also try to champion it and bring it forward to the minister just as part of their overall package — what they would like to see happening within their area.

B. Ross: My next presentation after this one is to the RDOS, and I will make sure our area rep is aware of it, plus the chairman of the regional district, for this purpose of fortifying it at the UBCM.

J. Rustad: Good.

J. Les (Chair): Very good. Thank you for coming, Bill.

B. Ross: Thank you for the opportunity.

J. Les (Chair): Interesting presentation.

Our next presentation this morning is from Wesley Shields on behalf of the Kelowna Chamber of Commerce.

Good morning.

W. Shields: Good morning, ladies and gentlemen. Thank you for inviting us today. I am Wes Shields, and I'm president of the Kelowna Chamber of Commerce. I've been asked to make a brief presentation to you folks this morning on the issues that are affecting us in the Kelowna area and the greater region of the Okanagan Valley.

What we've done is prepared a written presentation for you. I was hoping to go through that with you briefly today and then, obviously, answer any questions or concerns that you have.

If you take a look at the presentation I've provided, I wanted to identify to you folks who we are with the chamber of commerce. You all in your local ridings have chambers of commerce, but you may not appreciate the fact that we're the second largest in the province of British Columbia. Outside of the Vancouver Board of Trade we are the largest chamber of commerce in the province.

We deal with all levels of government, basically on the local level, at the provincial and federal level. We're a non-partisan organization. We're not affiliated with
[ Page 664 ]
any political party. We're simply the voice of business in Kelowna.

We represent over 1,300 members in our business community. In the region of Kelowna, if you haven't been there, there are 106,000 people. We have a diverse and eclectic economy which is focused on tourism, high-tech, the wine industry, agriculture. A whole raft of industries are set up in our region.

We draw probably, in terms of commerce, 450,000 people in the area. It's a hub for all sorts of business. Our retail and commercial base does attract about 450,000 people. We are a friendly place to do business, and I provided the statistics in there.

The reason I provide that is to let you know what we're all about in terms of the Kelowna area. I think that's important when I put forth my proposals for what we think is important — that you need to understand the impact of the Kelowna economy upon the greater regions throughout this province.

As we go forward, we've identified some issues that we think are of concern to us in terms of moving ahead and facilitating a good business environment in not only the Okanagan region but also in the Kelowna area. The areas that I wanted to touch on in my presentation and focus on: the organized crime, the property transfer tax, the harmonized sales tax as well as barriers to business development.

For some of the issues, you're probably saying: "What the heck has organized crime got to do with business?" But I'll tell you what it's got to do with the business community. If we look through the package that I presented to you, the first one I've talked about is organized crime.

[0940]

This is an initiative that the Kelowna chamber has been involved in for the past several years. Back in 2007-2008 Supt. Bill McKinnon approached us because there was concern about the escalating organized crime in the Okanagan area. For those folks who may not be familiar with it, we have an organized crime task force based out of Vancouver but nothing outside of the Lower Mainland.

A business case was put forth for the necessity to start focusing on key regions throughout the province — and the country, for that matter — where organized crime is growing. Unfortunately for us in Kelowna, that seemed to be a popular area. I guess criminals like the lifestyle and everything else that Kelowna has to offer, so that was identified as a key area.

In terms of the business, it's not just simply people getting beaten up on the street by organized criminals. They're affecting the business community and what's going on. So what we did is we took this initiative to the Canadian Chamber of Commerce, which we're a member of. The Canadian Chamber of Commerce, if you folks don't know, lobbies the federal government for changes. They recognized the necessity, that we need an organized crime task force set up in Kelowna.

To make a long story short, the funding was put into place. An organized crime task force is in Kelowna. It has a three-year mandate; it expires in 2011.

We've spoken with the Minister of Public Safety in Ottawa. He wholeheartedly endorses the necessity for this organized crime task force to continue in Kelowna. I met with the previous SG, Kash Heed. He supported that position, saying: "Yes, we need the organized crime task force. Talk to your counterparts in Ottawa, and ensure they support the funding to continue."

What we're here to say today is that we need that organized crime task force. The mayors up and down the valley have had a presentation by Sgt. Cary Skrine, who runs the organized crime task force. It has 14 members. They're set out by the Kelowna Airport. There's a new facility that's built out there. If you people haven't seen it, I encourage you to do so. These folks are tackling the very difficult issues that we're facing with organized crime here in the Okanagan.

The region…. Just so you know, with the 14 members, they cover as far south as the border up to 100 Mile House. They go from Hope westward to the Alberta border eastward. A large area, a lot of bad stuff going on.

I'm just saying that we need to revisit that. We need to ensure that the funding is in place so that when, in 2011, the year comes to an end, the folks that are operating that business are able to continue. That's one of the issues.

The second issue that we're also dealing with in terms of moving ahead is the property transfer tax. That's something the Kelowna chamber has advocated when we were members of the B.C. chamber a couple of years ago and also in our local lobbying efforts to have removed.

There's a 1 percent property transfer tax on property up to $200,000. Above that, we've got another tax of 2 percent on the balance. That's a lean sort of operation in terms of the way the government functions.

I'm a lawyer, and through our office we do a lot of e-filing in terms of documents. We send off the cheque and say: "Thank you very much for the property transfer tax." Quite frankly, I think there's a surplus of moneys that come out of that. It's not sort of a wash in terms of what it costs to run the administration.

Our concern is that this has a negative impact in terms of the business community. When you're trying to draw people into our community, rightly or wrongly, we have high-priced houses in Kelowna, and the affordability is a real issue. That's not an issue I'm dealing with you folks today. I'm dealing with that in Ottawa in the next couple of months with different sorts of tax rebates.

On that note, I think that we really need to take a hard look at the property transfer tax. If you look at it for the purpose of gaining revenue, if you buy a house, you pay your property transfer tax. Then on top of that you also
[ Page 665 ]
have your HST, or previously it was the GST that you just had. But there are two levels of taxes there that perhaps shouldn't be there when you start looking at what we're trying to do in terms of a developer or to fuel the economy in the construction industry, which is key in the Okanagan area.

We need to look at those multiple levels of taxes. It's our view that one needs to take a hard look at the property transfer tax and whether that's a form of revenue where we still need to go down that path. It's our view that it isn't.

There needs to be some sort of three-year plan in place where we can revisit that and perhaps scale back on the percentage. Is the 2 percent unreasonable for houses over $200,000? I think when this legislation was put in, other than Vancouver, the 1 percent was probably fair, but now we're running into a situation where the average house price, at least in Kelowna, is over $400,000. So we're asking that you revisit that.

The harmonized sales tax. In terms of that issue, just so you know, and as I preface my comments, we're a non-partisan organization. We took the bull by the horns in terms of a couple of years ago and did our own independent assessment on the harmonized sales tax.

[0945]

We concluded before your government announced anything that it was good for the business community. We received a lot of flak from our membership. We had people resigning from the chamber of commerce. But we think it's a good thing to have.

Having said that, we know that there are problems right now out there with the harmonized sales tax. We'd be kidding ourselves if we said everybody's a winner with the HST. We're not. There are losers — there's the construction industry; there's the restaurant industry — and those people need to be addressed in terms of where we're going in the future.

We've provided a number of statistics from the real estate industry as well as from the restaurant business saying that these people are hurting. We're suggesting we need to roll that back. We need to roll it back to make it equivalent to what the federal government is — their 5 percent. We suggest that it should be 5 percent at the provincial level.

If you're saying, "Well gosh, golly. How are we going to roll that back? And what about all the revenue?" we've figured that out too. So in the paper we've said that if you look at the provincial sales tax, what that was, and if you roll it back by 2 percent, it's going to be $1.5 billion that won't be into the public coffer in terms of provincial level. Your provincial sales tax garnered around $7 billion, so you're going to have to balance that off in terms of what you're getting through the HST through industries that previously weren't paying taxes or services that weren't taxed and balance that off in terms of what the rollback is.

The benefit to this in terms of cutting back the taxes is…. The restaurant industry, for example, which is hurting…. I'm not from the restaurant industry. They say the net sales are dropping down. "Those are hurting us. Our restaurants are going to close." I don't know, but it's something that's impacting the economy, especially in this region.

In terms of the construction industry, we're adversely affected by that, and we need to address that issue itself. No doubt Penticton's no different than Kelowna and up to Vernon. The house starts are down. The real estate sales are down. In the last month, for example, all the way from Peachland to Oyama there were 120 real estate sales. There are 800 hungry realtors, folks. The houses aren't selling, and they're not being built.

We need to rejig that issue, and from our perspective what you do is you reduce the harmonized sales tax — reduce it by 1 percent or 2 percent. We think 2 percent is fair. You may not think so, but we're advocating that on behalf of our businesses, and we've done some homework in terms of where that's coming from.

The final issue. It's not all doom and gloom. We've worked closely with the provincial government as well as our local MLAs, and we're very grateful for what they've done on our behalf. They certainly have the voice of businesses as one of their key concerns as well as a lot of the social issues, and we're certainly grateful for that.

Investing in business development is the last issue, and I think that's what we need to sort of focus on in the future as to what we need to do to assist the small businesses, which are the backbone of our economy. In moving ahead, we're looking at the skills gap and the programs that are available, within existence, in the government itself. What we're saying is that you perhaps need to enhance those programs, revisit the programs and make sure that we have the skilled people that are out on the street to help the small businesses.

We're asking that you also look at such things as…. We talked about the training tax credit. That was something that was a grown-in Kelowna solution — not a solution — but we offered that back in 2006. We think that that should be continued. We think you should look at the issues as to retraining individuals, assisting small businesses in terms of a cost-sharing arrangement.

Those are the types of things that we think will help the small businesses, because even with the HST, some of them are hurting. They need the additional resources to train people through training tax credits, co-op tax credits. Things like that, we think, will help the business community.

In going forward, what do we say? I hope I haven't used my time.

J. Les (Chair): You're getting close.

W. Shields: Getting close. Well, that's why I have to speak fast in terms of doing this.
[ Page 666 ]

In terms of going through it, I think it's important for you good folks here to appreciate the fact that we're not here to simply criticize. We're here to put forth constructive points that we think will assist the business community, our community at large, in moving ahead.

We like the sound tax policies that have been put into place. We like the…. We don't like it. I should preface that in case someone's here from the media. But the chamber of commerce has supported the HST because we do think it's good for the business community, and I think in terms of moving ahead that we like fiscal responsibility. We believe that's important.

Balanced budgets are very important, but on the same hand we also have to look at making sure that our economy is stimulated enough to keep those businesses that are hurting right now moving ahead. It may well be that there's some sort of spending on that side. We believe in the long term that will accrue benefits to the government, to the people of our community and to all of us here.

B. Ralston: I was struck in previous presentations by your organization about the importance that you attach to organized crime. It's sometimes not an issue that people want to raise. You seem to be ahead of the city of Kelowna in terms of consulting both with the Solicitor General here provincially and the federal Solicitor General.

[0950]

But first of all, did I understand you to say that the position of the provincial government is that the funding is entirely a federal responsibility? And secondly, what's your view on that?

It would seem to me that it's at least partially a provincial responsibility. Given that the negotiations for the contract are ongoing, it would seem to be an ideal time to make the point that this is an important part of the role of the RCMP here in this province if they're continuing as a provincial police force.

W. Shields: To answer your first question with regard to the funding, my understanding is the federal government allots money to the provincial government. It goes into the consolidated revenue fund, and then you good folks decide how that funding is allocated. In terms of the first commitment, the federal government — at least at this stage — is giving lip service to the fact that the commitment is there.

When I talked to your previous counterpart, Kash Heed, the point from his discussions with us last year was once we have a commitment from the federal government, then we are supportive, at least in theory, of going ahead and continuing the funding for that particular organization.

Because of the RCMP and its federal jurisdiction, the funding will come to the province. The province then decides how the money is allocated. If the province decides that we don't want a Combined Forces Special Enforcement Unit in Kelowna, and we think it's a waste of time, and we're going to put our resources into enhancing the RCMP in Nelson…. Well, they don't have a police force there, but let's say in the Fraser Valley.

M. Mungall: Yes we do.

W. Shields: Oh, you do. You have a city police as well, I think. All right, sorry.

Well, let's assume Nelson, using that analogy, then. Then it's within your hands or your domain to decide how the resources are going to be allocated. So if there's a set sum that's coming out to fund the RCMP, it's you folks at this level that decide if we're going to reinvest it in the coordinated special forces.

M. Mungall: My question is also about the organized crime, mostly because I was listening to the radio this morning about how known gang members — known only to the police, though, not to the general public — were actually recruiting children as young as 12 years old at the Kelowna roller rink.

My question is on some of the programming that the task force has been doing. Have they been doing preventative education work with young people as well as kind of, and this might not sound like the right word, the more reactionary? Like, once we've identified the gang and broken them up from a kind of crime-and-punishment perspective.

W. Shields: The short answer to that is no, and the reason being is its funding. It was supposed to be a 16-member task force. They've got 14 members, and they're on the road most of the time dealing with the really bad people. So the preventative hasn't come into place. In fact, even on the local level with Supt. Bill McKinnon, he's told me that the funding has dried up for a lot of the preventative programs. They used to attend in school, for example, and the drug awareness program used to be big. The funding is cut back on that, so now they're looking for volunteers to attend in schools.

To answer your question, unfortunately no, we're not able to deal with those issues. It's just sort of at the higher level that we're dealing with the organized criminal as opposed to the preventative at the local level, which is something important as well. I think that's important funding, but I'm not here to suggest that we also do that. But that's a concern, as well, with Superintendent McKinnon.

N. Letnick: Thank you, Wes, and thank you to the chamber for all the work that they do in our communities.

I didn't add up the numbers. It seems like with the reduction of property transfer tax, the reduction of harmonized sales tax and the increase in programs that we're looking for, there's going to be a revenue gap for
[ Page 667 ]
the government. The government currently expends about $40 billion a year in services.

Does the chamber have any position as to how we make up the difference? Are we looking at higher income taxes, higher corporate taxes, a reduction in services? Health care takes over 40 percent of our budget — very important to people in your constituency, I'm sure.

W. Shields: No, that's a good question, Norm. We're not saying that basically you slash and burn with no consequences. I think what you have to look at in terms of moving ahead is: what's the cause and effect? If you reduce the HST — let's assume right now the restaurant businesses is suffering by 10 or 20 percent — maybe the reduction in HST then generates more revenue. Maybe the consumers are out spending more.

If you give certain benefits to different industries that are hurting right now…. The construction industry is a major influence within the Kelowna community. If certain benefits are accrued upon them, perhaps then more spending. We get the construction workers out there. We get the retail business selling more of the products.

It's not a stagnant economy where you simply cut back and there's no consequences. The effect of reducing this will result in certain benefits that will accrue to the larger community. So we're hoping, at least from that perspective, that if you accept our approach, there will be further revenue generated, which will offset any sort of negative consequences by not generating the income from the taxes that are in place right now.

[0955]

N. Letnick: Yes. In the long term there will be more revenue generated from construction, from restaurants and from everyone else in the business community. In the short term, though, we will face more of a deficit, and in your presentation you talk about balanced budgets.

It still comes back to: how do we get there? How do we get the economy larger so that we can continue to afford our key programs like health care and education, like lowering tuition, and all the other things that people have come to us and asked for? I'm not asking today, but if at any time you can get your heads, you know, all the academics at work — because you give great presentations, put together great papers — on how we rejig the tax system to allow us to continue with balanced budgets but at the same time provide the lower rates of taxation and the higher levels of service, we would probably all appreciate reading that.

W. Shields: Well, if I could do that, I probably wouldn't be here. I'd be writing books and making a lot of money. Having said that….

A Voice: There's hope.

W. Shields: No, can I just clarify? I know I'm running over my time. Philosophically, we are in support of balanced budgets. We think that fiscal responsibility is key, and we appreciate what your government is doing. The problem is that we've gone through a lot of ups and downs, economic recessions and a lot of troubling times.

We're not suggesting that the HST is the cause of all this. All we're saying is that the long-term vision we like is balanced budgets. In the short term there may be deficits. That's what has happened at the federal level, and it has happened at the provincial level. If you say, "Well, we can't do this…." On the one hand, you're saying: "We need balanced budgets." On the other hand, you're saying: "Cut these programs." I think that what you have to do is to find a comfortable balance between the two and recognize that there are certain segments of our business community that are suffering.

How do we fuel those people? How do we get those businesses going? It doesn't mean we have to do some deficit financing. Perhaps you do, but at the end, I'm saying, if those businesses that are hurting right now survive, they will generate more income and more revenue for all of us in the future.

That's what I'm saying, Norm. Sorry I don't have an answer for your very interesting question.

J. Les (Chair): Okay. Seeing no further questions, thank you very much, Wes.

The next presenter is from the B.C. School Trustees Association — a repeat performance by Connie Denesiuk.

C. Denesiuk: Yes. I think you're even in the same positions as last year.

J. Les (Chair): Exactly. Under the heading of: "We meet again."

C. Denesiuk: Good morning, Mr. Chair and members of the committee. I'd like to start by thanking you all for taking the time to serve on this committee. I think it's a tremendous task, and it takes a lot of time to consider people's feedback as you make your recommendations to government. It's a huge job. I just commend you all for the work that you do and thank you for that on behalf of British Columbians.

I'm Connie Denesiuk, president of the B.C. School Trustees Association, and I'm representing B.C. school trustees across the province. As you know, BCSTA is a non-partisan organization that provides a wide range of supports and services to boards of education. Many boards have scheduled meetings with you and/or provided written submissions. The input from boards contains information specific to individual boards, and I'm going to provide a broader context today — based, for
[ Page 668 ]
the most part, on resolutions that have been passed at our governance meetings.

As you're aware, British Columbia has a highly successful public education system. International assessments involving developed nations rank our students amongst the highest in the world. Approximately 80 percent of our students graduate from high school, and we're proud to have some of the highest post-secondary transition rates in the country. These world-class standings are a result of the dedicated effort of teachers, administrators, trustees and government and reflect the high priority citizens place on public education.

B.C.'s publicly elected school trustees are immensely proud of these achievements and of the critical role that boards of education play in governing the education system at the local level. There is, however, room for improvement as we strive to prepare over half a million students to take their place as leaders in the 21st century. Graduation rates have plateaued, and we're very concerned that over half of our aboriginal students are not yet graduating from high school.

Our classrooms welcome an increasing number of children from new immigrant and refugee families, and the societal expectations of schools to play an ever-increasing role in health and home issues place additional pressure on the curriculum. While today's students embrace and expect the integration of technology in their learning experience, many school districts struggle with the related infrastructure and technician costs.

[1000]

Declining enrolment and its associated impact on funding continues. School closures create disruptions for students, families and communities. Although the overall funding of education has improved, these increases have not kept pace with the growth in energy, transportation, supplies and staffing costs required to run our schools.

Boards of education have worked hard to minimize the impact of these funding pressures on student services. Administrative costs have been reduced, and boards have been creative in exploring shared services opportunities.

Recently two boards came together to share a secretary-treasurer. Here in the Okanagan, the Okanagan Labour Relations Council has been providing shared service for a number of boards for a number of years. Boards have also been working with municipalities and regional districts to create efficiencies and to share facilities and services. We worry, however, that ongoing reductions in support services, school- and district-based leadership and infrastructure will have long-term negative impacts on student achievement and the health of the public education system overall.

Perhaps even more significant than mitigating the impacts of funding shortages on the system as it currently exists is that it is critical that we look to the future and the kind of education system that's required to prepare today's and tomorrow's students for success throughout the 21st century.

Emerging trends in how education is delivered and changing expectations of students and parents for increased choice in the effective integration of technology will challenge all levels of the system. While it's true that the solutions to these challenges are not totally dependent on funding, implementing new models of education will undoubtedly cost more. For example, the increased use of technology brings some efficiencies in the delivery of education, but it also brings a high overhead of building and maintaining the necessary infrastructure.

B.C.'s boards of education are committed to ensuring that today's and tomorrow's students receive the very best education possible. But they will require increased and sustained public investment to achieve this. We therefore respectfully make the following recommendations to government:

(1) To provide boards of education with adequate, predictable funding, including fully funding newly mandated initiatives.

(2) To continue to invest in the provincial network capability to ensure access to high-speed Internet in all public schools all around the province.

(3) Ensure equitable access to quality education for students in rural and remote areas by increasing the supplement for unique geographical factors.

(4) Consider financial incentives to attract new teachers to work in rural and remote locations of British Columbia.

(5) To continue to reduce and streamline reporting requirements for boards of education so they can reduce administrative costs.

(6) To reduce and/or delay the impact of the Greenhouse Gas Reduction Targets Act on boards to allow school districts time to upgrade buildings and vehicles so as to reduce emissions and the need to purchase carbon offsets.

(7) Provide additional funding to cover ongoing operation and maintenance of closed school facilities. Boards are in a position where they're not able to sell their properties, and yet, they may have buildings that they have to maintain on those properties, and that takes dollars out of the classroom.

(8) Fully fund public education transportation. We've been waiting for a review for about ten years, and so we're hopeful that that's forthcoming.

(9) Continue to make investments in early learning, but of course not at the cost to the K-to-12 system as it currently exists.

I'm going to add a No. 10, and that's just because this has arisen in more recent days. Given the frustration around the failure of the B.C. student information system, that the fees — districts were paying $10 per student this year — be waived and that the government put resources into resolving the networking issues and
[ Page 669 ]
ensure that it's up and running in fine fashion for next September.

Those are the ten recommendations, and I'd be happy to answer any questions.

J. Les (Chair): Thank you, Connie.

D. McRae: First of all, when you said the B.C. information system, is that the BCeSIS program?

C. Denesiuk: Yeah, B.C. student information system.

D. McRae: Yeah. I've used it myself as a high school teacher. It's not always enjoyable.

[1005]

Two questions for you. Graduation rates have plateaued. One of the things I'm concerned about is that I think we get too focused on graduation rates. I don't mean that in a negative way, but oftentimes we've seen graduation rates increase because we've actually lowered the bar. I don't want to see that happening any more in the system. But do you think the system actually focuses too much on the level of graduation, instead of actually just being prepared to enter life afterwards?

C. Denesiuk: Well, I mean there's a broad issue. Really, what you want to do is prepare every student in British Columbia for the next steps, whatever their chosen steps are, whether that's apprenticeships, whether that's post-secondary education — whatever their goal is.

I think part of looking at meeting the needs of all students is looking at: what is the optimum for every student? If it's graduation, maybe we need to look at alternatives as well. Maybe we need to open that up. We're doing a pretty good job with trades and more and more connections that districts have with their colleges and universities. So we're expanding those areas. But there is more that we can look at.

We want to continue to look at improving, and graduation rates are just a small piece of that success for all.

J. Thornthwaite: Thanks, Connie, for your presentation. You should feel good that at least we've got two teachers and two ex–school trustees here — that I'm aware of, anyway. I'm not too sure about the background of everybody.

Your recommendations are very similar to last year, and I'm very familiar with them. I'm just going to ask you a more, maybe, provocative question with regards to the relationships between the trustees of the province as well as the provincial government.

I'm just wondering how you see your role as the president of the B.C. School Trustees Association. Do you think that trustees should be accountable to either the provincial government, as far as the funding body of the education of kids, or to the teachers, parents, students that are part of school districts, or to the electorate who elects you in municipal elections? I'm wondering if you could maybe comment on that and where there might be challenges for all of us in those regards.

C. Denesiuk: Trustees are accountable, certainly, to their electorate, but as part of their roles they are responsible and accountable also to the students in the district that they serve and certainly to government in terms of…. We have agreements with regards to student achievement, and we need to ensure that we are fulfilling governance roles and duties in terms of balanced budgets. There are a number of legislative responsibilities and accountability measures that are in place, as well, for trustees or boards of education.

There is not one answer to that question. I think we're accountable to a broad range for many of our responsibilities. The electorate are certainly the people who make the selection and choose the trustees that they want to represent them, so they are certainly accountable to bring forward the values and priorities of the people who elect them. But responsibilities go beyond that, certainly, to do the best job that they can for the students of their district.

B. Ralston: Reports come to me about what the minister and the ministry may be thinking about in something called the 21st Century Learning Initiative, which contemplates, as I understand it, big changes to the way in which high schools would operate, the staffing levels, and just generally the work of high schools.

Can you share with us what you may know about it and your views of it, on behalf of your organization?

C. Denesiuk: The 21st century learning, or personalized learning, 21st century instruction, really is looking at — actually, the B.C. School Trustees Association has also been looking at — the future of learning and how we can improve and ensure that our students will be well prepared to take leadership roles in the next century.

It's really looking at each student and what it takes to provide the supports and services that each student individually needs to be successful. There is a provincial vision that is now emerging. B.C. School Trustees Association is very involved in bringing our members together to talk about how we can best serve the students of British Columbia. So we're having those conversations amongst, even, branches. The B.C. School Trustees Association has a number of branch structures. In those branch structures they're having those conversations as well.

[1010]

Communities are being engaged in these discussions. It's exciting in many ways, because we're talking about how we can do a better job for the students of British Columbia in the future. It's emerging. We're working
[ Page 670 ]
together with government. I met with the Leader of the Opposition, actually, last week. We had discussions around the same thing. As a non-partisan organization, we're having those conversations with whoever we can.

D. Donaldson (Deputy Chair): Thank you, Connie, for your presentation and the extensive list of recommendations. I especially hear that Nos. 3 and 4 are coming from…. Many of the communities I represent are remote and rural, so very important recommendations there.

I just wanted to ask — I know last year there were some areas that relate to recommendation No. 1, "existing unfunded liabilities" — if you could describe some of those once again and what the situation is compared to last year's presentation.

C. Denesiuk: I know last year we talked about even HST. We discussed the impact that that would have on boards of education. We now receive rebate for, I think, 87 percent of the HST that we're required to pay. So we receive rebates.

There are a number of expenses that come to boards of education that are staff-related, so much of the unfunded liabilities are staff-related. They are contractual. These contracts are negotiated at a provincial level, so boards of education are compelled to ensure that they fulfil the contracts. There's an expense that comes with that as well. There are a number of factors that are certainly beyond the control of the local board of education.

J. Rustad: Thank you, Connie, for your presentation. It's good to see you again.

As a former trustee, I remember many of these issues that you have raised and that were raised before. Actually, I went back and looked over the last 25-plus years — 38 years and perhaps even more. Most of these issues have been the same issues that trustees have brought forward, obviously not to the Finance Committee, because the Finance Committee hadn't been around then, but to various ministries in government.

As much as I'd like to get into the discussion about where the money could come from or how much the ask is, I actually want to go on a bit of a different track. Over that period of time, we've seen educational outcomes improve, in great part because of the good work that teachers are doing and that those districts are actually doing within the province.

But I'm wondering: if we're really going to take education up a notch or be able to…. You know, we've plateaued on a number of things. Do you think there is structural change? Do you think there are institutional impediments within the educational system, all the way through, that are perhaps barriers or perhaps things that should be revisited in terms of being able to move forward with student success? And is that something that, as a BCSTA organization, you've talked about or looked into?

C. Denesiuk: We have had discussions around what holds us back from further success. There are structures. I believe there are structures in place that we can work to remove. One example of that is even the school calendar that sort of compels you to certain hours and days of the year. We'll be bringing boards of education together — the chairs and provincial councillors — to talk about some of these barriers as well.

Flexibility at the local level is very important because one size doesn't fit all. When we have structures that compel all districts in the same way — and then you look at the uniqueness of every district in the province — one size doesn't fit all. I think the more flexibility at the local level, the more boards of education are going to be able to do within their limited budgets.

I think part of looking towards the future and what we are going to do, how we are going to continue to make sure that our kids are at the very top…. How are we going to continue to do that? I think we have to look at funding that vision. That may look different.

[1015]

When we look at what the vision looks like, it's: "Okay, now we have to fully fund that vision in order to ensure that it's going to be successful." Looking at the funding as it exists now, to looking at what we want education to look like and then fully funding that vision…. There's not really a number that is attached to that, but it's one that we need to commit to, I think. All of us need to commit to that.

M. Mungall: Thanks very much, Connie. Like Doug, I took special note of the recommendations around rural areas. That's something that I definitely hear a lot from my constituents about, of course.

My question does pertain a little bit to the unfunded liabilities, but also to your recommendation 6 around the greenhouse gas reduction target. I am a bit curious where that's coming from. Rather than ask for appropriate funding to address those targets, you're asking for a delay in having to meet those targets. I'm wondering why that angle. I'll let you just go there.

C. Denesiuk: Yeah. We could probably go either direction with that one. It could be either to have the funding to mitigate those costs, but we know that AFG has…. Last year when I came to you, I spoke about the AFG and asked for the return of the AFG. So we know it's come in two parts, but there hasn't been a lengthy period of time for boards of education to actually pay for the renovations and upgrades and new buses and so on that are going to be required to meet those greenhouse targets.

Now that being said, we certainly do agree that we need to take a lead in this. We know our students are probably the best examples of green because they're very socially aware and socially responsible with the environmental issues associated with greenhouse gases and so on.
[ Page 671 ]

We've asked for more time to ensure that our buildings — or the funding; it could be either-or — can be brought into the condition where they will in fact be more energy-efficient.

M. Mungall: So basically, just to clarify, if the funding is not coming, you need the time.

C. Denesiuk: Right. Thank you.

M. Mungall: But the funding would be good.

C. Denesiuk: Right.

B. Routley: First of all, thank you for the presentation. I want to comment, and you can take back from me my thanks for the training that I received back in 1980 when I first became a school trustee in the little community of Lake Cowichan. From 1980 to '86 I was a school trustee, and it was great training.

I still remember dragging my BCSTA manual out on the tugboat when I was going up and down the lake and had five hours to tow from Caycuse down to the mill, so I could read your manual. Anyway, it was wonderful training that I received as a new trustee at the time, and I thought your organization did marvellous work with new trustees — especially somebody that worked in a sawmill.

Anyway, I do notice…. There are a lot of good recommendations, but one that I have concern about is special needs. I heard from the school district in Vancouver. They raised the issue that special needs has grown from 6 percent of the education system in their district to 8 percent. So there is a dramatic increase in the number of special needs students.

I don't see any specific recommendation on that, and I wondered if your organization had any concerns in that area. I mean, I find that quite alarming, and it obviously has a huge impact on the school system.

C. Denesiuk: Thank you, Bill. I'm going to take back those comments, and I just want you to know that we continue to work on improving the trustee development that we provide.

With regards to special needs, I think if you asked every district in the province that question they would say that they are in fact experiencing an increase in students that have special needs. Those pressures really do exist across the province.

I would say, also, probably all districts spend more than the amount that they receive specific to special needs on those children to ensure that they're well-supported in their classrooms.

[1020]

It is an issue, and I guess we could add a No. 11, but I think I did talk about it last year.

J. Les (Chair): All right. Seeing no further questions, thank you, Connie, for your presentation again this year.

Next we will hear from the Okanagan College Students Union — Cory Nelmes.

C. Nelmes: Good morning, everyone. My name is Cory Nelmes. I am the financial coordinator of Okanagan College Students Union, Local 53 of the Canadian Federation of Students. I am a second-year student studying criminology.

I'd like to start off this morning by thanking this committee for hearing my presentation today and also express my appreciation for the opportunity to participate in this process.

Our students union represents over 5,000 students at Okanagan College, who study on campuses in Salmon Arm, Penticton and Kelowna. Our organization exists to advocate on behalf of our members, to provide services to our members that will make their lives easier, as well as to offer extracurricular opportunities that improve the college experience. This directs us to advocate for a system of post-secondary education which is accessible to all, of high quality, as well as rationally planned. It is on this point that I address the Finance Committee today.

In recent years a student's share of the cost of public post-secondary education in B.C. has increased. Public funding for student financial assistance has been reduced. Our members have prioritized seeking government measures to reduce student debt.

My presentation today is broken down into four key priorities that our members would like to see the B.C. government commit to. The first priority for all of B.C.'s colleges and universities is to reduce tuition fees. To start, reduce tuition fees to 2001 levels. This rollback would have the most impact of any recommendation we can give. This would impact low- and middle-income earners the most, but at the core, it would reduce the largest barrier to a fully accessible post-secondary system today.

Through the last decade B.C.'s post-secondary system has undergone a radical transformation. Since 2001 tuition fees on average have doubled across the province. This is a massive increase and cannot be adequately explained by supposed inflationary pressures created by the 1996-to-2001 freeze.

The decline in government funding to colleges and universities continues to fuel pressure to increase tuition fees. In comparison to other provinces, B.C. went from having tuition fees 30 percent below the national average to now surpassing that figure by 7 percent. In the past eight years we have set the record among provinces for the highest rate of increase in tuition fees.

There is ample evidence that financial barriers are the most significant obstacle to many citizens achieving entry into colleges and universities. For this reason,
[ Page 672 ]
we recommend that tuition fees in B.C. be reduced to 2001 levels.

Our second recommendation is to restore per-student funding to 2001 levels, accounting for inflation and indexed future funding levels on inflation. Across the system, per-student funding has declined by 15 percent in the past eight years. Every year that underfunding is not addressed, the funding gap worsens.

Under pressure from students and faculty, the B.C. government has recently begun to make up for earlier funding cuts, but progress has not been fast enough. Between 2001 and 2006 the budget of the Ministry of Advanced Education increased only 9.6 percent — less than the rate of inflation, at 12.9 percent, over that same period.

Moreover, this increase has done nothing to address the decline in B.C.'s per-student funding, which has fallen every year since 2001. Total spending by the Ministry of Advanced Education actually declined in 2008 by at least $96 million. This current funding policy fails to recognize the reality of inflation, and it needs to be addressed.

I would now like to turn to the issue of student debt. Our third recommendation is the elimination of interest charged on B.C. student loans. At an average of $27,000 upon graduation from a four-year program, B.C. has the highest student debt in Canada, outside of the maritime provinces. It is important to note that this figure only includes public student loan debt. According to Statistics Canada, the number exceeds $32,000 when private debt is included.

Members should be aware that following graduation, student loan borrowers pay interest on their public student loans substantially above the government's cost of borrowing. In addition to this, nearly every province charges a lower interest rate on student loans than B.C.

As you know, students with higher debt levels upon graduation pay more for their education through higher interest rates than those who had to borrow less or nothing at all in order to get an education. This creates a fundamentally inequitable system in which low- and middle-income students are expected to pay more for the same education as those who can afford to pay for it upfront.

By keeping interest rates as high as they are, the government is penalizing those students and their families with the least amount of financial resources. Meanwhile, in terms of the impact on the provincial treasury, the annual cost of even complete elimination of interest on student loans is nearly negligible.

[1025]

We recommend that the government eliminate interest charged on B.C. student loans to ensure that those who can least afford an education no longer have to pay the most.

The fourth and final recommendation we would like to make this morning is an increase in needs-based grants in British Columbia. Not only is B.C.'s rate of interest higher than average, B.C. is last among all provinces in the provision of non-repayable student financial aid, at 60 percent below the national average.

A report released in October 2008 stated that students in British Columbia receive the least amount of non-repayable assistance in the country. Only 12 percent of student aid in B.C. is not in loan form. B.C. currently trails behind Alberta, Saskatchewan and Ontario, which each designate over 30 percent of all student financial aid as non-repayable.

A study of wealth and assets done by Statistics Canada shows that student debt will increasingly have an influence on the ability of graduates to participate in the economy and enjoy the quality of life experienced by past generations. If students have difficulty repaying their loan, it is recorded in the students' credit report, and it likely limits their ability to finance future investments, even when the financial situation improves. We recommend the creation of a provincial system of non-repayable, upfront, needs-based grants.

In conclusion, the mandate of our students union is to promote a post-secondary system that is rationally planned, accessible to all and of high quality. The recommendations made in this presentation are not simply a guidebook for creating a more accessible Okanagan College but an important step towards rebuilding the economy of British Columbia.

The B.C. government has focused on rebuilding the economy by turning B.C. into a low-tax jurisdiction in order to attract corporate investment. In the wake of a worldwide financial crisis, however, this is simply pushing on a string. In fact, the revenue collected from tuition fees will this year outpace the revenue the B.C. government collects from corporate taxes. This is a symbol of a backward approach to building an economy.

The Okanagan College Students Union is committed to lobbying for an improved post-secondary education system that contributes to a flourishing province for all of British Columbia. Students of Okanagan College would like to see that the Select Standing Committee on Finance and Government Services will choose this year to prioritize and make the investment for an accessible and affordable post-secondary education.

The recommendations presented today — reducing tuition fees, increasing institutional funding, eliminating student loan interest and offering more non-repayable student aid — are not final solutions to the issues facing our post-secondary system, but they are a needed start.

Thank you for your time, and I look forward to your questions.

J. Les (Chair): Thank you very much, Cory.

I have a few questions, starting with Norm.
[ Page 673 ]

N. Letnick: The provincial budget, if I remember correctly, is about $40 billion. If you look at the revenue side of what students pay in tuition compared to the expense of offering post-secondary, it's about 25 percent across the board, across the whole province.

We had a presentation today, just earlier, from the chair of the Okanagan College board of governors that showed us that Okanagan College students paid about 18 percent of the cost of running Okanagan College, not 25 percent. Are you familiar with how other colleges are, regarding Okanagan College? In other words, is that about the same for all colleges in B.C. — where they pay around 18 percent of the cost of providing education?

C. Nelmes: I'm actually not familiar with that, but if I can grab your contact information, I will definitely find out and get back to you with my answer.

J. Rustad: Thank you for your presentation. I am interested in the issue of the student debt and interest. I think, as you've seen from the Finance Committee in the previous years, we've had some recommendations around that.

I do want to ask you one question, though, and that is around your position that reducing student fees would increase access — the ability for students to be able to access post-secondary education.

In Saskatchewan, for example — there was a recent report that came out by Stats Canada — the amount of students enrolled in university as a percentage of the student population was larger than that of Manitoba, and yet their tuition fees were higher. In Ontario the number of students enrolled in university was significantly higher than that of Quebec, even though the tuition rates were double what they are in Quebec.

So I'm wondering where the evidence is around lower tuition fees associated with higher accessibility to post-secondary education.

[1030]

C. Nelmes: All my statistics have come from Statistics Canada. The issue with financial barriers is that if you take…. Debt aversion is the number one reason students don't enrol in post-secondary education. So to look at different provinces in that sense is hard. I feel like when students go in, the number one reason a lot of students aren't enrolling in colleges and universities is that they're afraid to take on that debt. They're afraid of that interest. It's especially affecting lower- and middle-income earners.

I can't answer why the difference is in those provinces, but I know that here in B.C. most people, most students, if you talk to them, will tell you that the number one reason they won't go to post-secondary isn't because they didn't get the grades in high school, and it's not because they don't want to put in the work. It's because it's a financial barrier blocking them from accessing that education.

D. McRae: One question. You always talk about student interest rates on their loans, which is a concern to me. If it were to be eliminated, I'd be curious to find out from your organization what you'd estimate the cost would be.

C. Nelmes: I don't actually have an estimated cost with me right now, but there is precedent for eliminating interest rates on student loans. Newfoundland has already done it. Once again, I can find out the exact cost. If I can take your contact information, then I can e-mail that to you.

D. McRae: Sure. Perfect.

The other question I had was…. You know, your presentation is very similar to the one we had yesterday, and I understand that the concerns are broad across all students. But are there specific concerns from your specific student union that are more of a regional nature rather than sort of a global or provincial level?

C. Nelmes: I feel like our concerns are, of course, of our members of Okanagan College Students Union. But many of the concerns, such as reducing tuition fees and eliminating interest rates, would not only affect students at Okanagan College. They would affect students across British Columbia.

D. McRae: Right. Fair enough.

J. Les (Chair): Okay. I don't see any further questions. Thank you, Cory. I think several times you mentioned that you're going to provide us with additional information.

C. Nelmes: Yes.

J. Les (Chair): If you talk to Byron in the back of the room, he'll give you the contact information so that it can be provided to the entire committee — okay?

C. Nelmes: Perfect.

J. Les (Chair): Next is Jeannette Montgomery. Not sure who you're with, or are you just here as Jeannette?

J. Montgomery: Well, that came about a little bit late in the day. It was just going to be me, a concerned citizen. However, I'm on the board of directors at the Penticton Art Gallery, and I brought the issue in my presentation before the board last week at the meeting. I suggested I would donate my time to raising concerns from the art gallery, and it was unanimously agreed that I would speak on behalf of them as best I can.
[ Page 674 ]

I'm a new board member. I'm just going to say that right out right now. I have very little experience on the board at the Penticton Art Gallery, so when it comes to question time, I have some information with me, but I am going to be really happy to get back to anybody if there's anything I can't answer here.

Good morning, and thank you. My name is Jeannette Montgomery, and this is my second year addressing the committee in person. Last year I spoke on behalf of only myself. This year I do represent the board of directors at the Penticton Art Gallery. I'd like to thank you all for providing communities the opportunity to participate in this budget process.

My address last year was a bit of a gentle reminder for the committee to be mindful of the impact the reduction of government moneys has on public institutions, like local galleries, particularly in smaller communities, where resources are already stretched. Today I'm here to share with you some of the successes our Penticton gallery has seen and some of the things we're doing to help mitigate whatever negative impact we'll see from a further reduction in government support. And yes, I'll be asking the committee again to be mindful of what impact our actions today have on the ability to tell our own stories and those of future generations.

We've got a great team at the Penticton Art Gallery. Our five permanent staff are augmented by a fleet of volunteers who work tirelessly on campaigns, fundraisers, exhibitions and a host of other events and activities. Together, staff and volunteers are responsible for bringing in most of our annual revenue.

Gaming grants accounted for 1/8 of our annual revenue stream last year, and a reduction in that support can be devastating to a gallery as small as ours. It can mean not just the removal of one program but of several. If the reduction of support is continued, it can mean tightening the belt of an already lean organization.

We don't just run a lean budget because it's good business sense. It's primarily because we are accountable to our community as to how we spend the other 7/8 of our budget. It's their money. We have to run things lean.

Looking at our gallery figures for 2009, if there were to be a reduction in government grants from the as-promised $40,000 down to $10,000, I see several budget lines which represent that entire amount.

[1035]

A gallery can't run without any exhibitions. We might own the building, but we need to pay the city to keep the building on their land. These are fundamentals, not fat to be trimmed.

Each year the gallery staff and volunteers work tirelessly on multiple programs to bring unique opportunities to kids and students, great art to the community and money into the gallery's pockets. I'd say we've been lucky, but it's really the spirit of those involved and the sense of ownership our members have over this public space.

Last year our annual art auction — 33 years running — raised 11 percent of the year's annual revenue. Works of art are donated by other galleries, community members and artists, while community partners contribute everything from golf and wine packages to private concerts with Juno-quality musicians.

This year our summer educational program grossed over 3 percent of the expected revenue for this year. It's run by one of our board directors and facilitated by two college-university students who we receive funding for through other sources. In the last three years the summer program has gone from something which cost the gallery money to run and evolved into something which is a revenue generator, and with only 12 kids registered at a time in a room about the size of this.

What about those exhibitions? Sure, it can be a little costly to bring some of them in, but our permanent collection houses some of the most talented and internationally renowned artists of the last century. Using the permanent collection strategically throughout the season has both given opportunity to show off some of the outstanding works our gallery has acquired as well as provided us with incredible cost savings. On average, the annual cost for exhibition accounts for about 10 percent of our operating budget.

With a close eye on the bottom line, our exceptional curator, Paul Crawford, orchestrates exhibitions that engage, challenge, inform and inspire our community, just as a gallery should. We engage the community through things like showcasing work by Naramata secondary school students. We inspire by hosting our annual Kitchen Stove film series, in affiliation with the Toronto International Film Festival circuit group.

We challenge the public to think about what their perspective is when our curator builds a quarter pipe for skateboarders in the main gallery and invites professional skateboarders to use it. We inform and educate through kids' summer art programs, adult painting classes and by making our reference materials and library available to all of our gallery members.

Through all of these things, we persevere in the face of recessions, cutbacks and increased jobless numbers. Our community answers the fundraising call year after year. Like I said, we're lucky to have this support.

But what happens when our community sees that our provincial government isn't recognizing our efforts to engage, challenge, inform and inspire? It gets increasingly more difficult when the message received is that there are other themes deemed more important, that our community is not part of the province's financial bottom line.

Last year I asked the committee to be mindful of the impact our government has on our communities. It turns out that many people did the same, and the committee included in the report the recommendation to restore arts funding to 2008-2009 levels. Thank you. It's a step in the right direction and much appreciated.
[ Page 675 ]

However, not all recommendations are taken. There have been recent mumblings about more money appearing from gaming grants, but I don't know the details. Let's just say our gallery isn't budgeting for money that isn't already in the bank.

I'm one person, and I'm investing in my community in any way I can. I ask that the committee consider how the province can do the same.

J. Les (Chair): Thank you, Jeannette.

N. Letnick: Thank you, Jeannette, for your presentation and the great work that you do in the community.

This is going to be a similar question. I think I've asked it twice yesterday, and I'll continue to ask it of all arts groups. Are you getting any money from the B.C. Arts Council?

J. Montgomery: We are. I don't know the exact figures. I do know that the grant season has commenced, and we are approaching the B.C. Arts Council, the Canadian arts council, Heritage Canada and a number of other organizations, but I don't know what the exact figures are.

I know that we had originally been promised around…. I don't know. We've received in the past from the British Columbia Arts Council…. In the past we have asked for as much as $43,000, and we've been told to expect less than that. Probably between $30,000 to $38,000 is our anticipation. Again, that's decreasing every year too.

N. Letnick: Okay. So here's the question. Last year we recommended more money for arts, as you've said. Assuming we do the same again this year, which is a possibility…. If government does do that, would you like to see the money flow through the B.C. Arts Council or the gaming grants, and why?

[1040]

J. Montgomery: That's a really good question. Really, I honestly don't know how to answer that. I don't know enough about the structure of the gaming grants. I don't know enough about the structure of the B.C. Arts Council yet. I do know that our curator, Paul Crawford, attends as many of the B.C. Arts Council meetings as possible, as well as two other of our directors that are on the board.

That's a really good question, and I would like some time to think about it, because I would like to make a recommendation about that. I just don't know what it would be yet, and I wouldn't want to speak on behalf of just myself without consulting the rest of the board.

N. Letnick: Right. We have a deadline for submissions, which is October 15.

J. Montgomery: Lots of time.

D. Donaldson (Deputy Chair): Thanks for the presentation. It's impressive what you can do with such a small budget — all the activities you list.

J. Montgomery: And dedicated people.

D. Donaldson (Deputy Chair): And dedicated volunteers, I'm sure.

The gaming grants accounting for 1/8 of the annual revenue stream last year. I had a question. There was another group that presented yesterday, and they talked about the compounding impact of gaming grant cuts. It wasn't just what they received directly, but they pointed out that service clubs in the community that supported them through gaming grant money that they had received, of course, were impacted by cuts, and it just flowed down the line. It was even further.

I don't know if you could elaborate on whether you're finding that at the art gallery or other organizations in town that you know about — that compounding effect.

J. Montgomery: I definitely see the logic in it. From attending our fundraisers and advocating for our fundraisers this year, most of the turnout has been down. Our attendance has been down. Our efforts remain the same, if not doubled, and our incomes this year are down. I know it's because more people are going back to the same pool and asking for support, because across the board we are all receiving a reduction in grants and funding.

So we have 53,000 people in Penticton, and the same groups of people are now asking that body for more funds and more support. It's not just a reduction across the line and reduction of service groups that also can provide services, but it's all the people who don't receive the same moneys who we work together with as a team and network. We now are going after the same fish in the pond.

It gets difficult, and we try to be as proactive and supportive of one another as possible. A lot of the smaller galleries work together as much as they can. Grand Forks Art Gallery, Vernon Public Art Gallery, Kelowna Art Gallery — we are all really connected. We have membership-sharing programs. Members have similar benefits across other galleries. We're doing as much as we can to spread whatever we've got, but it does get increasingly difficult year after year for a lot of the reasons that you're talking about.

J. Les (Chair): Right. Thank you very much, Jeannette.

J. Montgomery: And I'm going to get some contact information.

J. Les (Chair): Yes, by all means. We look forward to hearing some further correspondence from you.
[ Page 676 ]

The next presentation is on behalf of the British Columbia Fruit Growers Association — Joe Sardinha and Glen Lucas.

J. Sardinha: Good morning. I might need my glasses here. Up until a year ago I had perfect vision. It just proves that if you do something long enough, growing apples, you'll go blind.

J. Les (Chair): No, it's your arms getting shorter.

J. Sardinha: That's true.

First of all, on behalf of B.C. Fruit Growers Association, we really appreciate this opportunity to present once again to the standing committee. It has been a privilege of ours in presenting a brief to the prebudget consultation each year since 2002. Of course, our association represents 801 producers in this valley — commercial growers in the Okanagan, Similkameen and Creston valleys — and our farm-gate value is almost $95 million.

I am here representing an industry on the move. We're continuing to implement an industry strategy which we undertook in 2007, and we're planning on updating that strategy. As times change, as conditions change, we'll be looking to forward initiatives in that regard.

The Okanagan has, of course, the right stuff to grow high-quality crops. We have the right climate. We have a very key core of innovative growers here, and we have the right varieties to meet today's discerning consumer needs.

On the subject of weather, of course we have some fabulous weather today, and I think this committee had something to do with it. Coming to the Okanagan, perhaps you brought it with you, and you had some form of divine intervention, as well, assisting you.

[1045]

B. Ralston: I think you vastly overestimate our power.

J. Sardinha: We are, of course, deep in the throes of harvest — a lot of great quality apples this year. Certainly, the weather has helped in that regard, and we're reaping the harvest.

The other thing, too, is that we recently were able to meet with the Agricultural Land Commission. It was a very valuable exercise that is currently going on in terms of the ALC review. They were quite surprised at the level of support for the agricultural land reserve that they received from the B.C. Fruit Growers Association.

Understand this: farmers love the land. Farmers love what they're doing. Farmers, of course, want to be profitable in what they're doing, and it's not always the case. But we love the land. We love growing healthy food for a very diverse and growing population. We love being part of the food security going forward in this province.

We're very proud of what we do. I've brought some of that pride today. You will be able to enjoy some Gala apples from my orchard, which I harvested yesterday in the afternoon, at the very end of the day. Please, by all means, enjoy those later on.

Of course, in terms of agriculture everywhere in this province, we do need to create a level playing field. That's very important. In my industry we are very excited about elevating our image with consumers, because we feel very strongly that's where our brightest chance for a future is — to continue to work with consumers and bring them on side, build the loyalty, loyalty along the lines of what is being experienced currently in the province of Quebec. There's great consumer loyalty there. It's that European sort of loyalty, and we hope that that spreads all across Canada.

The theme of this year's budget is "Building B.C. for your family." B.C. families are, of course, a positive and vital force in our province. Farm families generate income and employment in rural B.C. They also stabilize the economy during economic downturns.

Our farm families protect the environment in general and agricultural lands specifically. We hope that members of this committee will reflect on the contribution of B.C. farm families to the economy of B.C.

Specifically, B.C. farm families provide the initial step in the chain that includes the following: rural development and jobs in areas most impacted by economic downturns; value-added packing and processing, with retail and restaurant local product also adding value; healthy fruit and vegetable products; agricultural productivity in the agricultural land reserve; and also providing for future food security.

However, we are, I guess, fighting an uphill battle. The successive Social Credit, NDP and Liberal governments have, during good times and bad, reduced the agricultural budget as a percentage of the agricultural gross domestic product.

Therefore, our first recommendation is to reverse the trend of diminishing agricultural budgets, not only for the sake of farm families but also for the benefits that a strong, thriving farm economy creates as a first link in the value chain.

Furthermore, collectively we need to reverse the four-year trend of negative net farming income in B.C. Restoring the level of the agricultural budget to the average of the other Canadian provinces is essential to ensure competitiveness and to continue a strong role for farm families in B.C.

We know that the hog sector is all but gone. Where there were once 200 onion growers, today there are three. The cattle sector has decreased by 25 percent in a single year. The B.C. fruit industry has not escaped and has shrunk from 300 million pounds 15 years ago to 200 million pounds of apples currently. The B.C. agricultural community and farm families need competitive government programs to stop the shrinkage.
[ Page 677 ]

Last year we did not ask for increases in budgets, recognizing that, of course, there were huge fiscal pressures on the government. This year we are asking for the following improvements.

Place the agricultural budget at the average level of competing provinces. This will require an immediate annual increase from 5.5 percent to 13.8 percent of agriculture GDP — in other words, an additional $116 million. If this request seems excessive, it is not. It is a measure of how far behind the province has fallen.

Another possibility is to direct to the tree fruit industry a sliver of the Columbia River agreement funds which flow into government general revenues annually. You may ask this very question: how does the tree fruit sector have a claim on the Columbia River treaty funds? Our sector has been pummelled by overproduction of apples and now cherries in Washington State.

[1050]

Since the regular supply of irrigation water was made possible by the Columbia River treaty in 1953, the Washington State apple industry has grown from the same size to 25 times the size of the B.C. tree fruit industry. Clearly, some form of compensation must be offered to the B.C. tree fruit industry due to this impact.

We estimate that the current level of damage from dumping — based on 2003, 2004, 2008 and 2009 apple crops and the 2009 cherry crop, and assuming a frequency of similar market collapses every three years — to the B.C. tree fruit industry is $14 million per year, which is taken out of the economy that supports farm families. This shortfall is entirely caused by the overproduction in Washington State, which is made possible by the controlled irrigation water supply resulting from the Columbia River treaty.

Our requested increase in the agricultural budget is equivalent to $9.25 million per year in additional resources for the tree fruit industry. For the tree fruit sector, an alternate is to provide the tree fruit industry with funding by redirecting Columbia Basin treaty funds from general revenue to the tree fruit industry.

We also request the reversal of extremely shortsighted budget cuts to the crucial health and nutritional programs, such as the school fruit and vegetable nutrition program. Nutritional education in the classroom is not only getting rave reviews and accolades; it is a very effective way to help families improve their future health.

It has been reported, as many of you have heard, that the youth of today are the first generation in recorded history that will have a life expectation shorter than their parents. This is abundant evidence that the deterioration in health status is diet-related. Yet the government cut funding to the program that has a proven, positive impact on dietary choices.

We think this, in a nutshell, is what is wrong with the current health care system: choices that are driven by bureaucracies and lack of focus on programs that deliver results. If we sound frustrated and angry about the cuts to the school fruit and vegetable nutrition program, we are, of course.

We ask that the Finance and Government Services Committee provide very strong direction to restore funding and ensure that 100 percent of B.C. schools have access to this important health and nutritional program, the school fruit and vegetable nutrition program.

Moving further along, the budget consultation paper asks specifically: what are your priorities if government had additional resources? Certainly, debt reduction is prudent but should not be an exclusive approach, especially given the province's very high credit rating.

Health care costs must be managed according to business principles. A vision, specialization and prudent choices in health care promotion are not today in evidence. These basics must be achieved to control the obese health care budget.

Tax cuts are not a priority. As many of you know, B.C. apparently has the lowest personal income taxes already.

Our support for the HST is based on a system that follows the previous GST process and rules. However, the province included a new rule with HST which negatively impacts the tree fruit sector. We trigger the newly introduced recaptured input tax credit provision of the HST because our industry strategy of merging cooperatives into a single, more competitive entity has put us over the income threshold for the RITC provision to kick in.

A share of HST benefit for the tree fruit sector is estimated at $720,000 per year, but this will be diminished by the arbitrary introduction of the RITC for agricultural cooperatives and will penalize the tree fruit industry by $210,000 per year. We have asked the government that the RITC provision be addressed for agricultural cooperatives, as it was in Ontario, and we anxiously await a response from government.

Addressing tax inequities between rural and urban areas is important to maintain the social fabric of B.C. For example, the carbon tax represents a massive transfer of wealth and funds from rural and agricultural communities to urban communities, from needy communities to communities with well-above-average incomes. This is inequitable and must be addressed.

Investment in programs is required to support agriculture in particular, as well as other business sectors. This in turn will pay dividends in the future as our tax base grows. If you have profitable farmers, you also have taxpayers paying for future health care and education needs and programs.

[1055]

I'd just like to summarize that with the massive amount of financial requests that we've made in the previous part of our document we are recommending that the agricultural budget be placed at the average level of competing provinces, providing an additional $116 million in annual funding immediately.
[ Page 678 ]

Alternately, we have proposed that we could redirect $9.25 million of the Columbia Basin treaty funds from general revenue to the tree fruit industry, as I've outlined the amount of hurt caused to our industry since its implementation.

Reverse budget cuts to the critical health and nutritional promotion programs and provide a very strong direction to restore funding and ensure that 100 percent of B.C. schools have access to this important health care and nutritional program — that being the school fruit and vegetable nutrition program.

Finally, in terms of priorities, if government had additional new resources we recommend prudent debt reduction, but not an exclusive approach; that health care costs must be managed; and that tax cuts not be an immediate priority, as we already have very low tax rates. Addressing tax inequities between rural and urban areas is important to maintaining the social fabric of B.C.

Finally, investment in economic development programs is required. I think you'll see great dividends in the future if you invest today.

B. Ralston: Thanks very much, Joe and Glen. It's good to see you.

I have a question about your comments about the Columbia River treaty. I understand the treaty expires in 2014, and I also understand from American government officials I've met with that they are well into their preparation for those negotiations.

Have you considered…? I appreciate that your suggestion is a bit more of an immediate one, but have you considered making representations to the Canadian and the B.C. side in terms of their preparations for the negotiations to include this concern? I'm sure that given the length of the treaty…. Perhaps the irrigation benefits are undervalued in that treaty.

G. Lucas: Yes, we have looked at that and are formulating a strategy. The treaty does not expire, but I guess it's up for renegotiation.

M. Mungall: My questions also have to do with the Columbia Basin treaty — your recommendation there. First, just let me say…. Joe, when you walked into the room, I was like: "There is a farmer right there." You look like you could have walked out of one of my family reunions. I come from farming stock.

J. Sardinha: It's that obvious, is it?

M. Mungall: It is. You're passionate about it, which is wonderful.

Being the only MLA from the basin region on this committee…. You struck a chord with me because the Columbia Basin treaty is very important in our region. Immediately I think: "Is this something that you are having discussions with the Columbia Basin Trust and with basin residents on?" Creston Valley, obviously, produces quite a lot of fruit. The Columbia Basin Trust is having its symposium in October.

I would just be concerned that basin residents…. I don't see them overall having a problem with something like this, but they also wouldn't want to be blindsided and possibly seeing money that would otherwise go to the trust go elsewhere.

J. Sardinha: I think this goes back to several years ago. We did, I guess, team up with the Cattlemen's Association, particularly the cattle ranchers in the Kootenay region. We did, sort of, some investigation, and I do believe that at that time the president of the BCFGA actually went to the Kootenays and there were some discussions. Nothing ever came of it.

I think that our approach is not to impede on the trust fund itself. It was set up for a specific reason, and certainly it's for a specific region for projects or whatever is deemed necessary. That's why we've kind of gone away from that, and we've said: "Well, there's a general fund." Those general funds are coming back to the province, and perhaps that's really where we have to go with this request.

Out of those general treaty funds that keep flowing yearly…. I know it's going to be renegotiated; I've heard already that it's going to happen fairly shortly. It's out of those general funds — and it's quite sizeable — that we feel that something should happen for the tree fruit industry or agriculture in this region because of the impacts that it did have.

It's measurable. Just to give you an idea, initially, Washington State this year was reporting a potential crop of 108 million boxes of apples. Well, I can tell you that B.C. Tree Fruits, our main sales outlet in the Okanagan here, is going to be handling about 3½ million boxes of apples.

[1100]

At one point in time there were 30,000 acres in tree fruits in the Okanagan, and it was 30,000 acres in tree fruits in Washington State. Ever since the treaty, ever since they had this assured supply of water during their dry season…. Ever since that happened, ever since we dammed the river systems and guaranteed them that water, their industry has grown exponentially. We're certainly feeling it, and we felt it over the years.

M. Mungall: If I can just follow up on that, there are a whole lot of grievances coming out of that treaty, especially if you talk to basin residents. I would really urge you to discuss this concept with the trust. You don't want to end up going in with two different proposals and then fighting over the same pot of money, because negotiations are going to be coming up.

I know that you're looking for a general fund, but don't ever assume that the trust isn't looking for more
[ Page 679 ]
money. Make sure that you get basin residents on side with it, because they do have a sense of ownership over the results of the treaty. If you get them on side, your advocacy is that much stronger.

J. Sardinha: I would just like to say that the fruit industry is the fruit industry in my mind. Whether it's Creston or an apple grower down in the Fraser Valley, they're still a commercial grower, they're still meeting the same sort of challenges that we are here in the Okanagan, where the bulk of the fruit is grown. I would look at every grower, no matter where they are, as having…. Either they've suffered, or those who owned the farm previously have suffered as a result of the overproduction south of the line.

J. van Dongen: Thank you, Joe and Glen, for a great presentation. I have two questions there. Just a thought first of all.

You talked about the farm gate for the tree fruit industry being $95 million. I think it's always useful to also comment on the secondary industry, the tertiary industry — so the processing, packing — and the supply industry — farm equipment dealers, etc. If you have some kind of an estimate of that for the committee, I think that would be very helpful.

G. Lucas: John, I think that if you add the 2.5 multiplier in, generally what you're going to get is the overall revenue in spinoffs of the industry. We have, in the past, quoted $250 million as sort of the income generation of the entire industry. For this specific purpose we decided to concentrate on farm gate.

J. van Dongen: I appreciate that, but I think the point needs to be made repeatedly with government of all stripes that these are real jobs in your communities that the primary industry supports. No primary industry — all those other jobs are gone. That's important to understand.

The second question is on the school fruit and vegetable program. I've done a fair bit of work on that program, and I'm wondering: what is your understanding of the current budget status of that program?

J. Sardinha: The current budget status…. The minister did announce, I do believe, $2½ million for the program for this year, but that's slightly less than for the operations the previous year. It doesn't allow the program to continue to expand. The original goal was to expand to all schools in this province, and it doesn't allow for that. It's kind of like status quo and perhaps some cutbacks in terms of the number of weeks that each school will be able to have fresh fruits and vegetables available for our young people.

There is still funding. The program is by no means dead, but it does require considerably more funding if we're going to reach that target of providing programs to 100 percent of B.C. schools. We know that, for instance, schools in the north…. We know that nutrition of First Nations is a big issue too. I think it would be extremely positive to continue expansion of this program because, let's face it, child obesity is really on the rise. We have to do something for not just childhood obesity but the impact it's going to have on diabetes rates in the future as well.

D. Donaldson (Deputy Chair): That's a great lead-in to my question. I'm from the north and mostly represent a First Nations population in many of the schools that I represent. I've seen the results of the fruit and vegetable nutrition program. I know that one of the schools was running it and isn't running it this year. I witnessed a bunch of students running to plates of chopped-up fruit with glee and saying: "Look at this. This is great." It was pretty impressive.

[1105]

My question is along the lines of loyalty and promotion that you described in the presentation. Does your association have any views on the Buy B.C. program that was cancelled? I didn't see that in the recommendations. What are your thoughts on trying to get that reinstated?

J. Sardinha: Well, we'd love to see something reinstated provincially. I'll give you an example. We're members of the Canadian Horticultural Council. Earlier at the beginning of August we were back east in Ontario. This year we met in Oshawa, Ontario. We had a presentation at our meetings of the CHC apple working group from an individual who's heading up the Foodland Ontario initiative. The provincial government there is putting funding into an Ontario branding program, and they're getting tremendous results.

Ninety-six percent of Ontarians surveyed recognized the logo, recognized the phrasing — huge brand awareness. I think you can do no wrong in doing the same thing in our own province of British Columbia. Right now the times are ripe to bring the consumers on side to really support local.

It's not just me saying that. We had a tremendous amount of interest generated in the tree fruit industry this past spring. We've had people going into stores and saying: "Well, where are the B.C. apples?" Unfortunately, they were saying that, and towards the end of July and August we were out of fruit already. So unfortunately, they couldn't get any B.C. apples. But that's all very positive. We need to build on that.

I think in some cases, things like dairy products and that…. Well, we've got marketing boards, and there's a certain supply there. But fresh fruits and vegetables, B.C. beef, B.C. pork, B.C. lamb, you name it — most products will benefit from a Buy B.C. program or a program of that order.
[ Page 680 ]

J. Thornthwaite: Thank you very much. As a former nutritionist, I totally get what you're saying with regards to the school program. Actually, Doug stole my thunder, because I was going to talk about the Buy B.C. Have you ever thought…? You did mention a lot of the other groups. I know that we did get some really positive feedback from the promotions of B.C. beef earlier on in the springtime.

I'm wondering if you have thought about getting together with all the other agriculture groups like everyone that you had mentioned and focusing. At least two or three of your recommendations focus on educating the consumer to buy local and to support B.C. businesses; not just B.C. businesses but B.C. fruit, beef, whatever — any kind of agriculture product. So getting everybody together and promoting that one message would more or less cover off quite a few of your recommendations.

G. Lucas: Yes, if I could answer that. We do work through the B.C. Agriculture Council, and you'll be hearing from them. They can probably answer that as well as we can. By supporting just a general agriculture budget increase, just to the average of Canadian levels, would enable us to support these programs that are cross-commodities. The school fruit and vegetable snack program is a good example where it crosses many commodities. So we're not promoting it solely for apples, but carrot growers and broccoli growers and so on benefit from it as well.

I think the crux of our presentation is that it's not all about apples or cherries. It's about agriculture. We definitely need the financial support of the government to meet the competitive challenges. Governments have to be competitive in their programs, I think, and we've fallen so far behind. You see the effects on B.C. agriculture in the last four years.

J. Thornthwaite: Can I just comment on a follow-up? With regards to the Washington issue, if everybody in British Columbia knew that Buy B.C., Buy B.C., Buy B.C., then you wouldn't have the problem that you do have with the so-called dumping of other kinds of products that are cheaper on our British Columbia marketing place.

J. Sardinha: Well, I would beg to differ. I think you'd still have those situations. Really, on the dumping side, it's not so much of a provincial issue. It's more of a federal issue. I think we have to really press the federal government for some type of protection in those instances.

[1110]

To me, the whole idea of…. We've requested, obviously, a huge lump sum increase in the agricultural budget. It's just to bring B.C. up to the level of other Canadian provinces. What we need is a level playing field. I just talked about the Foodland Ontario initiative, where the Ontario government is putting in considerable funding to create brand awareness, to create awareness of local product. It's programs like that.

We've fallen behind over the course of so many years, and now this is just playing catch-up. We're not asking to be above all the other provinces. We're asking to be placed somewhere in the Canadian average.

We consider it an issue of fairness, but we also consider it a very important issue of creating a level playing field interprovincially and a level playing field so that we can meet the competition head-on, so that we have programs and ways of expensing dollars that are going to make a difference to make farming profitable in this province for all sectors — not just the tree fruit sector, but for all sectors.

J. Les (Chair): Before I go to Bill, John, you seem to have an urgent question.

J. van Dongen: I think the committee would appreciate some technical backup on the recaptured input tax credit issue. So if you could give us some technical background on that, that would be helpful.

J. Sardinha: Okay, yeah. It's currently with the Finance Minister.

J. Les (Chair): Maybe just feed it into us through the website. That way we'll have it.

B. Routley: Thank you, Joe and Glen, for a very informative presentation. I'm alarmed. In the Cowichan Valley food security is very much an issue, and I'm alarmed by the statistics about the loss of onion growers and cattle sector, etc.

I'm wondering if this money that you're requesting…. Exactly how would that help reduce the loss of agricultural land? Certainly, the people that are involved in the industry…. There's obviously a concern in the Cowichan Valley with the problem of attracting new, young farmers because of the problem with the cost of land — all of those issues.

Has your industry got any innovative ideas on how we're going to attract more young people into farming? In the Cowichan Valley, I'm happy to say, we do have some new, young farmers. I've gone to their farms. I know that it's trending in the wrong way. How would this $116 million help to resolve the problem of a downward trend of people being involved in the agriculture industry?

G. Lucas: If I could start on that very quickly, it would allow us to introduce programs such as the Buy B.C. program or promote B.C. product consumption. It's a little expenditure, but it results in a big support from the consumer.

Environmental farm plans. Another program where the province provided some funding. About a third of
[ Page 681 ]
improvements on farms were from the government funding. The producers took on two-thirds themselves, but that funding was reduced, as well, last year.

We'd like to see those programs restored. That encourages young people to get in. It shows that we can have competitive programs with other regions. That really is what it's all about. If we have a level playing field, we'll go head to head with anyone.

J. Sardinha: If I could add just a couple more points. You mentioned farm succession. That's a huge problem. Perhaps a portion of that $116 million…. I know there's probably not enough money in the bank to do this, but it would be a good start. Perhaps we could look at developing a land trust where farm properties are actually purchased from farmers wanting to retire. Then newcomers can get easy credit terms so that they can get into the business.

From an affordability point of view right now, one of the biggest challenges in this province — and maybe the ALR has had something to do with it — is the fact that agricultural land is so expensive. It's the most expensive land in all of Canada to farm, whether it's the Okanagan or the Fraser Valley or parts of Vancouver Island, where most of the agriculture occurs. That's an ongoing issue.

Glen mentioned the branding. There should actually be a joint venture between agriculture and education and health. The school program — expanding it to all schools in B.C.

Certainly, we've heard a lot about farmers markets, and I think funding has been cut back to the B.C. Association of Farmers Markets. Maybe some more funding could come out of the $116 million to encourage more development of that, because that's having a big impact on communities, especially where there is a lot of small-lot agriculture, and B.C. is famous for small-lot agriculture.

[1115]

On the EFP side, Glen's right too. The funding was cut. We lost, for instance, programs such as deer fencing, and in this area of the world deer fencing is critical if you want to protect your young apple or cherry orchard. So there are certain aspects of the EFP program that could also use more funding. The environmental farm plan program has been wonderful PR for the industry in terms of people looking at farmers as stewards of the environment rather than polluters. That goes with the image that we want to portray to today's consumers as well.

J. Rustad: Thanks very much for the presentation. It's good to see you both again. I look forward to the apples that you have brought, as I have in previous years as well.

I really liked your comment about the Health budget of obesity. I thought that was a very interesting little sideswipe perspective.

The request you're asking for represents about a 2 percent increase to personal income taxes for the extra $116 million. I don't want to focus on that so much, but since the 1950s the level or the amount of money that people spend of their disposable income on food has dropped from about 17 percent to about 5.6 percent on average. That's a stat from the U.S. I'm just wondering. I mean, that's one of the biggest challenges that we have.

People look for the cheapest product possible when they go out and shop. Personally, when I go into a grocery store, I always look for as local a product as I can get. Price, you know, is secondary, but I'm in a position, fortunately, where I can afford that. Some people can't.

So the challenge, I think, and the challenge I'm wondering if you've given some thought to is that cheap-food policy that the world has had around some of those prices. How do we address that? How do we address the issue, the local product, trying to support that industry? I know there's the talk about the Buy B.C. The hundred-mile diet, I think, did a great thing for local production, for farmers markets. The amount of activity in farmers markets and the number of farmers markets is increasing.

That level of awareness in increasing. How do we capitalize on that, and how can we move beyond that — you know, that 5.6 percent — to getting people to think about the product or the quality as opposed to the price?

J. Sardinha: Yeah. That's a real dilemma. And you're right. Food Freedom Day is almost like a day earlier every year. I think February 8 was the last date that I recall. That's the time of the year where most Canadians — I'm not just saying British Columbians — have paid for their food needs for the year in terms of the income generating that they have for that year. And that's a rather disturbing figure when one considers that it's going the wrong way in terms of what we as producers need.

As farmers, for instance, we're very tired of constantly fighting competitors' product. I think we need to tell a better story to consumers, or build on a positive story. Consumers hear that farmers are doing terribly. Does that encourage them to buy local, or does that discourage them? "Oh, our farmers are whining again." I think perhaps just portraying a more positive image of one's industry, of one's products is going to have some of the biggest impacts.

We've certainly seen that with the wine industry. You know, they've had their challenges too — the grape wine industry here in the Okanagan. But we've certainly seen that they've been able to hold their chins up and portray a very positive image. Even when Mother Nature and the weather don't cooperate, they're still portraying a positive image.

I think maybe, whether you're in the cattle sector and you're going through BSE or whether you're in the tree fruit sector and you're seeing dumped product on the market, if you can stay…. I think part of it is staying positive and having a positive outlook and a positive promotion to consumers that's going to have the biggest
[ Page 682 ]
impact. It doesn't hurt, also, to have a provincial branding initiative to back you up and tell that story — link the farmer's face with the food that's on someone's table. And we don't do enough of that.

[1120]

Perhaps the grocery stores…. For instance, the way they don't allow a lot of extra point-of-sale material anymore. If they put up posters with farmers' faces, whether it's a milk producer or whether it's someone that raises sheep or whatever, and there's a little bit of a story about this farmer, maybe those kinds of connections are going to have a huge impact.

J. Les (Chair): Good. That concludes the questions. Thank you, gentlemen. You'll probably have noticed that I've allowed you to go on at some length, but we happen to have the time this morning, and I thought it was all very interesting.

J. Sardinha: And we appreciate this opportunity. Thank you.

J. Les (Chair): Next, from the district of West Kelowna, His Worship the Mayor, Doug Findlater, is here.

Go ahead whenever you're ready, Doug.

D. Findlater: Okay. Good morning. I am the mayor of the district of West Kelowna, one of B.C.'s newest municipalities, although Sun Peaks is now newer than us, incorporating…. But we incorporated at the same time, less than three years ago, when Barriere and Clearwater did as well. I'm here today to talk about policing costs.

Just by way of a little more background, we're a new municipality just shy of 30,000 people, so we're considered in the large category by the UBCM. I don't know if 30,000 people is large, but it's certainly larger than many municipalities in B.C. It's been a very, very interesting transition for a municipality of this size to go from provincial services and regional district services.

One of the areas we took on early — we could've left it longer, but we're glad we did — was to sign a municipal policing agreement. Instead of running out a five-year transition program, we wanted to get on top of that pretty quickly. We've learned a lot.

As a result of that, I'm here not asking for more money, but I'm going to suggest a way to save some money. This comes about through discussions with our staff and with the RCMP, who actually have encouraged us to raise the issue.

At the core of it is to look at placing RCMP members on the B.C. Medical plan. Currently, the RCMP pay the medical costs. If I've got a guy or a gal in the RCMP who's got to go to the doctor, they pay for the doctor's appointment and many of the other things.

We're coming up with a suggestion here that may take a little bit of the pressure off the costs. We signed the policing agreement in April of 2009. Our policing budget in 2010 is $3.7 million, almost $3.8, and we have seen, even during that time, many cost increases being downloaded. That's the term that's used. These increases often are verbal and sometimes by letter, with little opportunity for input or decisions from the district. They're simply arbitrary downloads.

Some of the costs that have been downloaded include increases in the costs of crime, the recordkeeping system, RCMP pension and CPP, and new requirements for closed-circuit video equipment.

I also note we're building an $8½ million RCMP detachment. This is a project that was in the works prior to incorporation, and we followed through on it. We actually made a good decision to dump the first round of tenders at council and wait six months. We saved a million dollars in the tendering, which was just at the time that the stock market fell apart and the world changed radically in six months, so we had a break there.

We're also pleased with the arrangement we have with the provincial detachment, which shares the building, because the provincial detachment and the other people who will be renting space in that building will be paying about 56 percent of what we pay on the debt. So we've got some tenants, so to speak, that help cover the costs.

Just in terms of this particular suggestion, we'd like to suggest that the committee pick this up and research and consider the overall effect of placing RCMP members on the provincial B.C. Medical plan. Currently, it is a direct cost to the RCMP and would not be a direct savings to individual municipalities, but it is a large cost that's incurred.

[1125]

The RCMP in West Kelowna has 21 members, and this equates to about $350 per member a month versus the B.C. Medical cost of $57 per month for a single person. It would save, in our budget, $73,000 annually, which is actually quite significant to us. That's approaching a 0.5 percent property tax increase on the average home in our community.

We're looking at any opportunity to reduce these overall costs, and if the RCMP has an opportunity to reduce these costs, then our thoughts are that they may be able to absorb some of the other things that they come to us for all the time, like PRIME, the pension and the closed-circuit video.

So that's our suggestion — to see if you can work out a way to save a few dollars for the RCMP where they're better able to absorb some of these other costs.

J. Les (Chair): Thank you very much, Doug.

N. Letnick: Thank you, Your Worship, for coming out. I appreciate it. Good to see you again.

Two questions. One is on the RCMP. I thought the Canadian government was responsible to fund the medical costs of the RCMP.
[ Page 683 ]

D. Findlater: Well, but then they put the cost onto us as part of the program. We're saying that if they were put on the B.C. Medical plan, there would be a significant saving.

N. Letnick: I'm going to have to look at that a little more.

D. Findlater: Okay.

N. Letnick: Another cost, maybe not direct, is the cost of putting in jails around the province. I understand — correct me if I'm wrong — that in your building there's no provision for cells.

D. Findlater: There is no provision for cells. That's the way it was designed. There is a provision to expand to do cells. Cells are not actually the big cost. The cost is an operating cost. But we do have an arrangement with the city of Kelowna, which they indicate they're happy with — for the time being, anyway — that works for them and works for us.

D. Donaldson (Deputy Chair): Thanks for the suggestions. These are always positive things we can look at.

I was curious as to whether…. I haven't seen the resolutions book yet for the UBCM. Was this something that your municipality put forward in that regard as well?

D. Findlater: No. We've raised another issue related to the capital cost of health care and having First Nations reserves, particularly where there are large numbers of non–band member residents, contribute towards the capital cost of health care, such as hospital expansions. This came up relatively recently.

B. Ralston: I recall in the past that as a new municipality, you had some concerns about planning for future infrastructure and how the district was going to finance that. I'm wondering: was the district able to take advantage of some of the recent joint federal-provincial programs? Where are you at on that?

D. Findlater: We are basically knocking off our highest priority, which was almost 1,500 sewer connections. It's not very sexy, but this was an urgent priority for homes in urban areas that were 20 to 50 years old with septic systems. We were able to access, I think, about $11 million or $12 million to do that. Our streets are a mess right now, but we don't get too many complaints because people realize that this is a good thing, especially in a home of that age.

We have other needs related to roads. We did apply for some roads infrastructure funding and came up short on that, but hopefully, there'll be another round for that.

Another issue where we have pretty much come up dry — and we're very, very concerned — is that there's not enough money related to mitigating the forests for wildfires. Of course, we had two significant fires in our municipality in 2009 — Rose Valley and Glenrosa; 15,000 people out of their homes, half our community — and we had a scare with Seclusion Bay this year. We did lose one structure, and there were about 70 people evacuated. So there's a lot of work to do in that area.

If you're looking for ways to spend money, that would be a great one as well, and we'll take some of it. [Laughter.]

J. Les (Chair): We might not be challenged that way for some time.

Anyway, that's great. We'll do some research on that RCMP medical costs issue. It's an interesting one. I can see a couple of angles that would need some further research.

D. Findlater: Of course.

J. Les (Chair): Anyway, we appreciate it.

We have two people who have shown up this morning that would like to come. The first one is Sherry McLeod.

[1130]

S. McLeod: I guess that I've come as what the man with the apples was saying — the face.

J. Les (Chair): The man with the apples? Yes.

S. McLeod: Yeah. Joe, who was here.

I have a disease that is similar to MS, and I want to be the face for the people who are watching the news; suffering, like me; going downhill, like me; getting number.

Just some background on who I am so that you know who people are who get MS. I have a genetic type. So my daughter has this, my grandchildren have this, my cousins on Vancouver Island have this — right back to Ontario have this. It's called Charcot-Marie-Tooth. It's kind of like what I call the kissing cousin to MS.

I go to the MS group here. We meet at the food court on Tuesday mornings and discuss what's going on with the government, with funding. We had the hope of the liberation treatment, and we were excited. I have papers here on one of the ladies who comes to that group, who had that treatment on July 5 and is, amazingly, getting better. There's another person in Summerland, another one in Oliver — Ron. He wrote an article as well. He went to Poland to get his.

I used to work for the RCMP. I guarded prisoners for three years. I had three children of my own, all of whom have the symptoms that I have. I was a foster parent, here and in North Vancouver, of 42 children. Most of those were what the RCMP fellow was talking about. I took the bad kids. The one who took the gun into the Summerland school — within an hour, he was mine. He was a dear, and I loved him. He walked in the door and saw my smiling face and said: "Hi, Mom."
[ Page 684 ]

Then I became a nurse and worked with geriatric people, some of them with dementia. That was great. I didn't have to take them home and keep them there.

Now, as I was getting number and number, thinking I was getting older and older, I realized that I have this.

We were dismayed to see that the government has cut off the funding for something that could do so much for us. There was the program at UBC. We were excited about that. We were hoping to get into that. They wanted people, some people who had genetic connections. My sisters have what I have; their children have what I have. Now my doctors won't even discuss it. If you mention the liberation treatment, they just say: "Don't even go there." They don't want to hear it. So our hope is gone.

I'm hoping that you people who are in the government, who are looking after the purse strings, will see me as a face of many hundreds and thousands.

I can't afford to go to Costa Rica. I was a single mother when I did most of the things that I did. I don't have that kind of money — to go to Costa Rica, like one; to go to Poland, like another. I have to sit here and wait for the studies in UBC — if it comes back. It went from, "Oh, they're going to have 1,700 people," then we heard it was 50, and now we hear that it's called off. Now they're saying that Newfoundland is going to have it. People are…. They don't know what to do.

So when I turned on my news this morning and Dennis Walker said that you were here, I rolled out of bed and thought: "Okay, I'm going there so that you can see and hopefully hear our plea." Please help us. We're not disposable people. We're people who have been teachers and workers in the community.

[1135]

I started two free stores for low-income people, one in Richmond that lasted for five years. I started that on my own; I ran it two or three times a week. Another one here at my church, at the Pentecostal church, years ago. Now we have one at the Vineyard, where I go now.

We're people who have been productive. Just because we have this and we're going downhill…. We're listening to things on the news that describe what we have. A man was in having the operation. It's not really an operation. They just put a prick in your groin, put the angioplasty up, open up the blood vessels — the jugular vessels that are blocked.

One of the men said: "You just unplugged something — didn't you?" The doctor said, "How did you know?" and he said: "The pressure went out of my head." Well, I burst into tears. I've had that pressure since I was 14. It just feels like your head is being squeezed. My granddaughters have both had it — EEGs on their brain because of the same pressure.

We just ask for funding for this. We ask for your help. Know that we're out there, and please help us. Do something to get these…. I don't know why they're cutting it down. Okay, they're nervous. We're nervous. We want this done right. There are people, like Dr. Zamboni, who can teach the doctors here how to do it.

It's so simple. It's not an operation. You're awake. You're talking. You get up. This lady here, Judy…. They went out for supper that night. The next day they went on a nice cruise, and the next day they were back in Penticton. She was at our group on the third day, sitting in the food court telling us about it. When I first saw her, she looked 80. Now she looks 62, which is what she is. She can lift her legs that she couldn't lift before, do exercises she couldn't do before. She's becoming the person that she is.

We sit, and we laugh, and we compare, and we get disgusted. We compare notes. Actually, I bought a computer. I don't know if I'll ever be able to use it, but I'm going to try, because we keep each other up on the news as to what's going on.

So please, when you're doing your funding, think of us. Do something for us. You know, it can't cost that much money to get these guys together at UBC to do this. There's ultrasound that they can do on the jugular, or they can do an MRI. Now on Vancouver Island they're cutting down the MRIs. I think there are a lot of people over there that have it, and probably a lot of them are related to me. So that's what I ask.

J. Les (Chair): Thank you, Sherry — certainly a very compelling presentation. We certainly feel for your condition and what you have to deal with.

M. Mungall: Sherry, let me just say thank you so much for having the courage to come to the committee today and share your personal story. My mother-in-law has MS. She is bound to a wheelchair if she's able to move at all — an electronic wheelchair which she can only push with her hand. She has to sit in a chair all day, and that is her activity — very minimal activity because she's in so much constant pain. So I'm personally knowledgable about what it is to go through and live with a neurological disease like MS. It also runs in my family too. It's on my side of the family.

S. McLeod: Are you a Proctor?

M. Mungall: No.

S. McLeod: Or a McLeod?

M. Mungall: No. Not even close. Last name is Bourgeois.

I wanted to share that with you and to thank you. But also maybe if you could share with the rest of the committee what liberation therapy…. You shared a good story of how it has changed people's lives, the hope that it brings and the difference from being completely debilitated to just having some movement.

[1140]
[ Page 685 ]

My mother-in-law would like to come and visit me at my house. She cannot do that because the trip on the plane would be so painful for her, so that's not an option. And the car ride is just too darn long, and she'd be in constant, constant pain.

She is going for liberation therapy in Mexico with Dr. Zamboni in a couple of weeks, and she is also very disappointed that we don't have clinical trials for liberation therapy here in B.C. So I'm just wondering if you could maybe expand on that a little bit more — the difference between being bedridden and just having some movement.

S. McLeod: It would be amazing. One of my first patients in Victoria was a woman with MS who lay on her back, and she couldn't even sit up to eat. We had to feed her lying down, and I know that I'm headed there. Now they have hope. One of the women in our group is in a wheelchair constantly. She has a laptop on her lap, and all she can do is use this thumb, and she types out. She got into the Ottawa Parliament just a few months ago — about six weeks ago — and they had called together, because a lot of them were saying: "My mother, my sister, my daughter has MS. Get out of these people's way."

Right now I can walk, and my walking is getting worse. I went to my neurologist a week ago, and he said: "You're worse, and you're going to continue to get worse." There's no need for that. This treatment takes 20 minutes to an hour. You lie down and they put the thing in. How many people have died from angioplasty? You're afraid that we're going to die? Well, excuse me, but we're all going to die. We're not getting out of here alive.

To have a hope that I could go there, that my grandchildren — 14 and 17 — who are already numb with it and have been for years…. When I was numb, when I was a child, I was told: "Oh, don't be so stupid. Everybody has that." Well, I have to laugh now because everybody in our family did. To know that there is something that could help me to walk, that could help your mother to move.

This lady was…. I'll give you this, one of these stories, and you can pass them around. She's in a scooter. She can hardly walk. I, most of the time, have to move my legs manually. She had to always move her legs manually. Since July 5, since she had this, she can now lift her legs partway because she is doing physio. She can lift it partway just by thinking about it and then have to lift it the rest, you know. But that's going to change, because, you know, six weeks ago she couldn't do the lifting of the foot by herself.

I always had to move this one, my left leg. Now I'm having to start to move this one to go forward and back. If I'm sitting and I want to move my foot forward to shift, I have to do it manually often. The brain signals don't go through.

I don't know how I could describe to you who can do all the actions that I used to be able to do, and then you can't. To know that there's something in the world that can change that, and B.C. and Canada are saying: "We don't want any part of it." My doctor is saying: "Don't even say that word to me."

I took things off of the Internet. I go to the library and say: "Will you please get me information on the liberation treatment on what they're doing now." It's like angioplasty for the heart. Dr. Zamboni, his wife had…. He's from Poland, I think it is.

His wife had MS, and so he started doing studies on people with MS and found that all of the people that he found had the jugular vein — the ones that come down through here, down through the chest…. I've always had pain in my chest and could never figure out why, and so did my mother. They go through the jugular, and they open up the veins. They put angioplasty. They're perfecting the stent, which was metal, but the jugular veins are different than what you have in your arms and the rest of your body.

[1145]

So one person's shifted, and they said: "Oh, he died." Well, the other one died, just because he died. Okay, perfect it. Now they're perfecting the stent; they're making them wider. Instead of metal, they're making them with, I think, sort of like a plastic kind of a thing that will stay, and they're doing it. And if we die, well, we die, but nobody…. I think with one person they said, "Oh, it shifted, and he died." One person. How many people die when you open them up to do angioplasty on the heart?

When you're in a condition like your mom and like where I'm headed, and where most of these other people come in their wheelchairs and they come in their scooters…. I'm lucky. I can still walk. When I leave here, I'll walk home — well, plod would be more like it. But I'll get home, and I just tell my body: "Shut up." You know: "I'm going there, and you're going with me." And there's no need for it. There is this that is hope.

Now, some people have had it, and it has made a huge difference. Other people have had a moderate difference; I'll take it. Other people have had little difference; I'll take a little. I'll take what I can get. Then I can see in my children's eyes and in my grandchildren's eyes that there's hope for us. Because right now, they're watching me with anxious eyes, and they know that they're on that path, and they're going to go down it.

How do you explain to them: "Don't have children. You're going to end up with one like me, like you"? You know, where do you go with that? I believe, because I connect with what they're saying, that that liberation treatment will help us, and maybe that is what is genetic — not a disease that causes this.

The iron that goes into your brain is supposed to drain out, but because of these narrow jugular veins, it can't go out. That causes the lesions on the brain, which I have a lot of, as do other MS people. They're saying, "Oh, it's because of the lesions."

My question is: is it because all of this stuff is getting stuck in the brain and this causes the lesions — that
[ Page 686 ]
actually this is the problem? If you fix the jugulars, is the MS totally going to go back? Now, we have myelin degeneration because of that, and with some of that, maybe it's too late to get it back. But maybe it's not. How do we know until we try?

J. Les (Chair): Okay, Sherry. I've got to try and move on, okay? I've got a couple more questions, though.

J. Thornthwaite: Thank you very much for your compelling presentation and personal stories. I can't begin to — none of us can — understand what you're going through. I appreciate you having the courage, also, to come here.

My question to you is: what are you asking of us? To help people like yourself? What I'm getting at is: where are the roadblocks?

I would assume — I'm talking from a clinical perspective — that the approval of funding for a procedure like this would have to have the studies that prove its effectiveness. You're saying to me that there are lots of people that have gone all over the world that have gotten successes.

If that was just the only story, then that would be a compelling argument for us to fund that, but are there other things going on? Are there a lot of people that have had this type of procedure and haven't had any success, and that's why there are these barriers?

S. McLeod: No, there have been some that haven't had success, but this has only come out on W5 just a few months ago now. About a year ago they said that at UBC there was going to be a study, and there would be 1,700 people that would be in that study.

J. Thornthwaite: A clinical trial.

S. McLeod: Yeah. First they'd have to learn how to use the ultrasound machine, because the regular ultrasound machines — when you go in to find out if you have a baby — don't work. There's another ultrasound machine that they do use on the jugular. They need that. My doctor, my neurologist here, said: "We don't know how to do it. We don't have the machines here in Penticton."

[1150]

They had them down at the False Creek clinic. When they did some operations down there and helped a lady from Vancouver Island and it got on the news, they went and closed the False Creek clinic down. So you can't even go there and have it done and pay for it.

There are people who know, and we want the people trained. We want to know that there's…. Zamboni has a team that teaches people in other countries — Costa Rica and all these places. There's a medical something or other that if you go through them, they make sure that you've got a doctor who isn't some wacko who says: "I can just do that."

Apparently, a man who did opening of veins in other parts of the body thought: "Well, that sounds like a piece of cake. I've done lots of this." But when he got into the jugular, he said that this is a whole different thing because they're so much wider.

We want to see these studies started. They were going to do one in Saskatchewan. Now all of them are quit. Now we hear that maybe Newfoundland — they're going to do a few out there.

Why are they closing it down? Our consensus is…. Is it the drug company? They're going to lose a lot of money, because the people who will take drugs — I refuse — are paying thousands of dollars a month on drugs. I just say: "No, I'm not taking them." Are they holding it up? Is the government holding it up? Is their fear stopping us from getting better? Well, get over it. It's us. We're not afraid. Why are you afraid?

There need to be studies here in Canada. We need to get on the bandwagon. Let's not be last this time. Let's be one of the pioneers. Why are people having to go to all these different…. And paying $25,000? Sorry, how much is your mom paying?

M. Mungall: My mother-in-law. I'm not too sure.

S. McLeod: There's $25,000, $23,000. I mean, it's a lot of money that these people are putting up.

J. Les (Chair): I have one quick, final question from Don.

D. McRae: Actually, my question was answered in the statement.

J. Les (Chair): Okay.

Sherry, thank you very much for coming this morning. Obviously, you've struck a chord with the committee, and hopefully, we can make your time here this morning worthwhile.

S. McLeod: Thank you. I'm going to give you these papers to look at.

J. Les (Chair): We have five minutes left for Sharon Mackenzie.

S. Mackenzie: Thank you for your time. I'm on a different side of the spectrum. Instead of asking for funds, I'm saying: "Take less funds from us taxpayers." I think this will relate to the citizens in your different constituencies.

I live just across the way, and my issue is with the B.C. Assessment office. I appealed my taxes, to fight it. This is pretty impressive stuff.

I bought a property in June 2009 for $400,000. To me this is a small, modest price. But B.C. Assessment thinks it's worth 300,000 percent more: $1,144,000. I pay $3,800
[ Page 687 ]
in taxes now. You go three times that. As a senior citizen, I'm saying to you people: "You want to have more money into the coffers. Well, you don't wish us moving out of our homes — because we're being taxed out." There's an issue here that is wrong.

My issue is with your Crown corporation. They are using legislation that was not used before in the instance of my land. I am of a group of ten people that have provincial Crown leasehold land. I will be booted out without anything in 2027. I am quite aware of that. So I have bought a prepaid lease. I paid $400,000 for it.

Your B.C. Assessment is now deciding that I will be assessed as if I own it fee simple. Guess what. I don't own it fee simple. They are manipulating legislation that was brought in, in 1974 for purposes that are not today. We are many that are going into these types of places for budget reasons. Everything is a known fact — how we're going to budget. I can't all of a sudden come up with another $8,000 taxes. There's something wrong here.

Bill Barisoff, at one time in his young years, worked for assessment appeals and all that.

J. Les (Chair): He's still relatively young.

[1155]

S. Mackenzie: Yeah, okay.

And he says: "Oh, this is wrong. I'll get my executive assistant to do something about this. This is totally wrong. We wish our senior citizens to stay in their homes, not to be taxed out, and this is flagrant."

We are senior citizens. Like the ten of us, one is 99, and there are three of us in wheelchairs. I'm considered one of the ones that should get up and do something about it. But with a fax machine…? I started reading through this. This is way beyond my ability. They're quoting court cases and everything else. This is formidable. I'm to put a written submission in to counter the B.C. Assessment, and then they will rebut it. I don't have anything after that. Reading this, it looks like a pretty uphill climb.

The legislation says the B.C. assessors can evaluate my land as if I own it fee simple. But you all know what fee simple is like. You can transfer it whenever you want. You don't have restrictions from the Crown. The Crown has restrictions that I can't take my house off my property. I can't mortgage it, so if wish to sell it to you, you better have cash because you can't mortgage to finance. There are restrictions against it, and the assessors will not look at this. They just go one to one.

Because I live on the lake…. And when I say I live on the lake, I only lease the footprint underneath my home. The easement around my home is for the use of the 350 other householders to walk and to access the lake whenever they wish. Of course, they're kind of kind, but just the same. I also have a boulder breakwater there, but I have to be a nanny goat to get down to the lake. But the assessment office is just blind to this.

So as to how to fight this…. Legislation is what is there. Rudy, the executive assistant of Bill, went in and tried to say to the B.C. Assessment appeal board, the assessors and the review panel: "Boys, you're using legislation, and this isn't the intent of the government." They reported him, and he's got a diplomatic mark on his record for turning up at a meeting — told by Barisoff to go there and speak for us. Anyways, this is the way they play. It's a little bit of hardball.

J. Les (Chair): For time, we're going to have to maybe leave it there, Sharon, but your comments obviously have been noted, and we will….

S. Mackenzie: I'm sure there are people in your constituents that…. It doesn't matter if you own a little lake….

J. Les (Chair): No, it's not an uncommon type of situation, unfortunately.

S. Mackenzie: But it's legislation that should be changed, and you are the government. B.C. Assessment is your corporation. They're going nuts.

J. Les (Chair): All right, we will do what we can to look into that situation and see if it has broader relevance.

S. Mackenzie: Well I hope you do, to help the people in your own areas.

J. Les (Chair): Thank you for coming.

That concludes our hearing this morning. The meeting will now stand adjourned. We will reconvene later today in Kamloops.

The committee adjourned at 11:58 a.m.

[ Return to: Finance and Government Services Committee Home Page ]

Hansard Services publishes transcripts both in print and on the Internet.
Chamber debates are broadcast on television and webcast on the Internet.
Question Period podcasts are available on the Internet.

Copyright © 2010: British Columbia Hansard Services, Victoria, British Columbia, Canada