Finance and Government Services — Issue No. 33 — Tuesday, September 16, 2014 (HTML)

Lax Kw'alaams Room, Highliner Plaza Hotel
815 1st Avenue West, Prince Rupert, B.C.

Present: Dan Ashton, MLA (Chair); Carole James, MLA (Deputy Chair); Eric Foster, MLA; Simon Gibson, MLA; Wm. Scott Hamilton, MLA; George Heyman, MLA; Mike Morris, MLA; John Yap, MLA

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

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


CONTENTS
Page
Presentations	751
E. Wilson
C. Bomben
K. Veldman
A. Baker
S. Ionita
T. Luciow
D. Nobels

D. Ashton (Chair): Good morning. I have to say good morning, Elizabeth. Thank you very much for coming this morning.

My name is Dan Ashton. I'm the MLA for Penticton and the Chair of the committee, the Select Standing Committee on Finance and Government Services.

We're an all-party parliamentary committee of the Legislative Assembly with a mandate to hold provincial-wide public consultations on the next provincial budget. The consultations are based on the budget consultation paper that is released by the Minister of Finance. Following the consultations the committee will release a report with recommendations for Budget 2015, no later than November 15 of this year.

This year we are holding 17 public hearings in communities across the province. A video conference session is also scheduled for October 8 to hear from three additional communities, which are Dawson Creek, Quesnel and Smithers. This week we're in Victoria; Prince Rupert, as we are here today; Terrace tonight; Fort St. John, Prince George tomorrow; and then Vancouver on Thursday.

In addition to the hearings, the committee is accepting written and audio and video submissions and responses to a short on-line survey. You can make a submission or learn more by visiting our webpage, which is www.leg.bc.ca/budgetconsultations. You can also follow us on Facebook or Twitter.

We invite all British Columbians to take the time to make a submission and participate in this very important process. All public input is carefully considered as part of the committee's final report to the Legislative Assembly. The deadline for submissions is Friday, October 17, 2014.

Today's meeting will consist of presentations from registered witnesses. Each presenter will have ten minutes to speak, followed by a five-minute period of time where the panel can ask questions. If time is permitted, we will also have an open mike at the end of the meeting, where five minutes is allowed for each presenter. If you wish to speak — although you are registered — people can register at the door.

Today's meeting is being recorded and transcribed by Hansard Services, these fine folks over here. A complete transcript of the proceeding will be posted on the committee's website. Also, all of the meetings are broadcast live in audio via our website.

At this point in time I'll ask members to introduce themselves. Since we're all on the road together, we've gotten a little bit personal here, and we call everybody by first name. So please, it's not being disrespectful. It just makes it a little bit easier for each and every one of us.

C. James (Deputy Chair): Carole James, MLA for Victoria–Beacon Hill and Finance critic.

D. Ashton (Chair): The young lady in the back is Sarah Griffiths, and Jan and Alexandrea are the people from Hansard that are helping out.

Thank you very much for coming. It's nice to see you again. I did kind of remember your face from last time. Please, the floor is yours for the next ten minutes. Then if we have any questions…. I would just encourage you to go ahead.

Thank you for coming back. My name is Elizabeth Wilson. I'm the coordinator of the North Coast Literacy Now steering committee.

We would like to thank you for listening to us the last time you were in Prince Rupert, and especially for your recommendation that provincewide community literacy initiatives receive $2.5 million in funding through Decoda Literacy Solutions.

I realize that you are all very aware of the key messages about the importance and cost-effectiveness of community literacy initiatives. This morning I'd like to talk instead about wicked problems, literacy and budgeting.

Wicked problems are dynamic, complex and multifaceted. When faced with wicked problems, people bring forth highly diverse values, perspectives and opinions. Wicked problems contain unpredictable and shifting barriers and ambiguous criteria. They keep coming back. Even when it seems that they are solved, wicked problems recur. With each recurrence they increase in complexity. Each attempt to create a solution changes the understanding of the problem.
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As a community, a region, a province and globally, we face our fair share of wicked problems. We are frequently dealing with significant change and dramatically diverse perspectives.

We all know examples of wicked problems that continue to challenge us each day. They are situations that elicit significant emotional involvement and high risk. They include, among others, extracting, transporting and using energy resources; adapting lifestyles to counter or adapt to the effects of climate change; working effectively in situations within diverse cultural and religious world views; providing equitable resources within an economically diverse society; and, possibly, developing a budget for a socially, culturally, economically and geographically diverse population.

In order to come to some sort of resolution around these and other wicked problems, we must recognize that requirements for a solution are volatile. Constraints and barriers keep changing, diverse participants can't agree, and the end point is constantly moving.

Wicked problems give rise to both interpersonal and cognitive conflict. They may lead to disintegration and fragmentation of relationships, projects, organizations or countries. They can lead to destabilization of global systems. Considerable time and effort are spent without much to show for it in the way of a solution.

Usual ways of solving problems cannot be used to deal with wicked problems. When there are strong and diverse values and beliefs among participants, where there is not universal agreement about either the problem or the solution, where some decisions must be made and where people will have to change their attitudes or behaviour in the process, there is likely a wicked problem.

The opposite of a wicked problem is a tame problem. Tame problems may be quite complex, but they lend themselves to analysis and solution by known and practised techniques. A traditional linear process is sufficient to produce a workable solution to a tame problem in an acceptable time period, and it is clear when a solution has been reached.

When we try to tackle a wicked problem as though it were a tame problem, we think we will come to a workable solution. In time, however, the wicked problem will resurface in the form of changed constraints, volatile requirements or significant resistance.

High levels of literacy are essential to begin to tackle wicked problems. Literacy is essential for learning, understanding, listening, discussing, working together and accepting personal and societal change as a normal part of life. Strong abilities in learning, understanding, listening and discussing are critical if we are to acquire knowledge, question, present ideas, understand barriers and consider options.

With strong literacy abilities we are able to comprehend ideas from a range of perspectives. With strong literacy abilities we can begin to understand and respect the diversity of values, goals, assumptions, beliefs, meanings and experiences that others bring to the conversation.

When there is no clear and easy way to define either the problem or the solution, we can understand that the problem and the possibilities of solutions are integral to each other and must be worked through together. Literacy means making sense of our world. Increased literacy in all areas and by all members of our communities is the only way that we as communities and as a society will be able to identify the effects of wicked problems in our lives and work with others toward viable solutions.

We realize that the development of a provincial budget is complex, challenging and multifaceted. You will have heard during your meetings diverse and emotionally charged visions of how to allocate the funding that makes up our budget. We thank you for your support and ask for your support again.

We are asking for continued funding of $2.5 million for community literacy, to be funded through Decoda Literacy Solutions.

Anyone who drafts a budget of any size realizes that the problem of budgeting is seldom that of not having any money. Not having any money is a tame problem. Your challenge is considerably more complex. Drafting a provincial budget which involves so much money invariably reflects values about what is important to the government and to the citizens of British Columbia. The decisions you make about what to do with the money we have will reflect the differing values and opinions of those who are creating the budget and those they consult along the way.

We are, therefore, very fortunate that you are making this trip throughout the province to consider the values, perspectives and priorities of your constituents. We believe that providing sufficient resources to support community literacy is critical to a prosperous future for B.C. We also believe that providing sufficient resources to support other forms of formal and informal learning is crucial.

We ask that you communicate your understanding of the significance of literacy as integral to the future of British Columbia. We also ask that you urge the government to act on this understanding by allocating sustainable funding for community literacy through Decoda Literacy Solutions.

In addition to recommending that community literacy receive funding of $2.5 million through Decoda Literacy Solutions, there are other things that you might be able to do to support the critical work of increasing literacy levels in B.C.

(1) Remain current and knowledgable about the positive impact of increased literacy on all aspects of life. Support the organizations in your communities and in the province that work to further literacy. These include a strong and viable public school system, accessible post-secondary education, high-quality affordable early educa-
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tion, well-funded community public libraries, and sustainable adult education and training programs.

(2) Remove barriers for people who wish to continue or upgrade their education. Understand that literacy is a connecting link through everything. Increasing literacy levels in all areas and for all people, not just reading and writing but in all aspects of life, enhances the health and strength of us all. Increased literacy has an incalculable positive effect on all aspects of life.

When we better understand how to stay healthy, how to work with others, how to contribute to our families and communities, how to wend our way through technological changes, how to succeed in our jobs and professions, how to respond to rapid societal changes, how we are influenced by our culture and how to deal with wicked problems, we have more control over our lives, we are better able to make wise choices and we are better equipped to deal with the challenges and problems facing us today and in the future.

C. James (Deputy Chair): Thank you, Elizabeth, for your presentation, and I love the approach around wicked problems and tame problems. It's a great analogy and a great way to be able to look at challenges.

I wonder if you could talk a little bit about the numbers of people that are served in the north coast in the area of literacy or a little bit around the kinds of people that are receiving the programs and services.

E. Wilson: Now, we as a group, our North Coast Literacy Now, actually don't have implementation funding. We haven't received implementation funding probably for about six years. We do still have money because we are very good at dealing with it. We have a steering committee that is made up of members of the organizations that I've mentioned — for one, obviously, Northwest Community College; the school district; adult education; adult tutoring and training programs.

We also have representatives from the aboriginal villages. We represent three different languages in our literacy — French, Sm'algyax and English. Amongst that group is where many of our programs run. They run through those groups and through those budgets. Our own budget is basically limited to being able to provide somewhere between zero and $5,000. So we regularly support the public library here.

We support the Books for Babies program through them. We also support special collections for the northwest through them, particularly collections that are geared to our population. We have run the Mother Goose program for many years, and we do that in partnership with other organizations. Our particular group runs it at the Acropolis Manor, because we involve three or four generations of people in that process.

We've provided a lot of funding to Lax Kw'alaams school for literacy programs that involve multiple generations, elders coming in and working with small children. I'm just trying to think. Maybe, amongst that group of people, there may be 200 or 300 people involved in that. We also run each year a celebration of literacy. That involves, usually, about 20, 25 organizations that put up interactive displays in the mall, and it is a celebration of all the various ways that people in our community are helping other people, basically from birth through elders.

E. Wilson: We try. Well, we don't charge a lot for what we do. We don't charge anything for what we do, and we do work in partnership whenever we can.

G. Heyman: Thank you for your excellent presentation. I particularly appreciate the linking of literacy to citizenship and not simply people's personal economic circumstances, important as that is.

My question is: in the course of your work dealing with people who are overcoming their own lack of literacy or improving their literacy, are you able to identify factors that seem common in their earlier lives in the education system that contribute to the failure to gain literacy through school? Is there an interactive relationship with the local school board or teachers around that issue?

E. Wilson: Obviously, teachers are dramatically involved with literacy, as are all the early learning groups in our community. I would say that from my perspective — and of course, I am immersed in this — we have excellent people working at all levels in formal and informal education.

We also have, in some ways, extraordinary challenges. It's not necessary to sort of recap the historical and sociological effects of life on aboriginal populations and aboriginal communities. Our schools have over 60 percent population of aboriginal students in them. We have an excellent, excellent aboriginal education department that works toward that.

People face challenges from the fact that for many people…. Their parents and their grandparents, who might have guided them toward the way of learning in schools, didn't have positive experiences, so we're looking at maybe the first or second generation of kids who have that.

There's also, of course, not a history of a viable link
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between school success and success in life for many aboriginal populations. That is absolutely changing. We have excellent aboriginal students. That's part of some of the reasons why those experiences may affect somebody's literacy.

D. Ashton (Chair): You'll have to make it quick. I'm sorry. I have one more question, and then we have to move on. I do apologize. Finish, please. Go ahead.

E. Wilson: Okay. The other thing is, as I've mentioned in my presentation, that the requirements of literacy have become considerably more demanding. It is extraordinarily difficult now to understand what's going on in the world and to make decisions about it.

M. Morris: Just quickly, a good segue into my question, the complexity of the society that we live in today. A lot of activity is going on in the northwest here with LNG and some of these other projects that we have. Do you see any…?

We've got a workforce that needs education. Is Decoda involved or is your group involved with helping these individuals out? Could you tell me to what extent?

E. Wilson: Very quickly, yes, that is the case. Recently I met with representatives from Hartley Bay, and they were asking about what they can do to help their entire population increase literacy and also get workplace training.

We talked about the post-secondary institutions and their role in that and also about all of the essential skills involved in workplace literacy and how they might be able to work together in groups and with the resources, both in the northwest and the province, to help their entire community — those kinds of things that we do.

S. Gibson: A quick question. With literacy, people are embarrassed about their lack of language skills and being illiterate. How do you engage with those people to even bring them forward? In my experience teaching university students, most of those folks, even adult learners, hide. They don't come forward and self-identify. How do you engage those people?

E. Wilson: We as a committee don't personally do that, but again, we have a very good adult tutoring program. Also, the college itself is very good at seeking out people. They ran a program this last year for people who were homeless — increasing literacy in multiple areas, figuring out how to wend your way through life when you in fact don't have a home and don't have the usual supports.

In our community we recognize the fact that there are going to be people that have barriers. We try to find ways to eliminate those barriers by searching out those people and making it a comfortable thing for them to do — allowing other things to be involved, not just going in and saying, "Here's literacy," but making it a supportive and comfortable environment for them.

D. Ashton (Chair): Elizabeth, a very good presentation, very good answers to the questions. Thank you again for coming.

D. Ashton (Chair): Before we move, Ian, please excuse me for trying to change your parental given name, so what happened in Prince Rupert stays. You're not "Jan." It's "Ian," and I apologize.

Thank you for coming again. So a ten-minute presentation. I'll give you a two-minute warning, and then we've allotted five minutes for questions from the panel. As you can see, we do have quite a few. Please, the floor is yours, Corinne. Again, thank you for coming.

C. Bomben: Thank you for making Prince Rupert a stop in your consultation process. We appreciate the opportunity to contribute ideas towards the 2015 provincial budget. My name is Corinne Bomben, and I am the chief financial officer for the city of Prince Rupert.

I'll be speaking on behalf of the city as it relates to our ability to meet the needs of the proposed LNG boom in our region. There are some gaps between the capacity Prince Rupert has available and the needs of the proponents. I will begin with revenue challenges and follow it with infrastructure obstacles.
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Since 1996 the city has experienced a significant population decline, mostly due to economic changes in key industries. Although there has been investment in the port as of late, it has not been significant enough to rejuvenate the economy. As a result, the community is in great need of renewal and is faced with significant deferred maintenance challenges.

One of the challenges our community faces is a taxation regime that has capped the mill rate on properties that qualify for the Ports Property Tax Act. The nature of the improvements on these properties is that their assessable value declines. A capped taxation rate on a declining value results in a decreasing revenue stream to the city. All of the major industrial properties in Prince Rupert qualify as a designated property under this act.

The result has been a shift in taxation burden to the residential and business taxpayers. Given the reduced population, this burden has been significant. Although the province provides a ports competitiveness compensation grant, this grant is not sufficient to make up the amount of subsidization of these industries by the remaining tax classes. This tax act has been felt particularly by Prince Rupert, given there is no other major industry that is not capped.

This challenge adds another complication towards maintaining and renewing our infrastructure. Well-planned, properly constructed and well-maintained infrastructure is essential for public health and safety and is key in economic renewal and revitalization. Given the recent interest in our community from a proponent perspective, we have been analyzing our infrastructure to identify the needs of the proponents as well as the needs of the people who currently reside or will reside in our city. I will detail these challenges in the order of water, sanitary, transportation, solid waste and airport transportation.

The city of Prince Rupert collects its raw water from a 100-plus-year-old dam at the mouth of Woodworth Lake, on the mainland. Access to the dam is limited to a 2.2-kilometre walking trail or a helicopter. This restricts all-weather access.

From the dam, the raw water is fed by gravity through an equally aged supply line that runs along the side of a canyon to the treatment facility located at the lower end of Shawatlan Lake. The treated water is then fed through two submarine lines that run under the Prince Rupert harbour to our municipality located on Kaien Island. The submarine supply lines flow through a booster station to an above-ground tank reservoir. It's then distributed to the city by our water piping network.

Almost every component in this water system is past its expected life cycle. The estimated cost to renew the system and improve our access is $12 million.

The current sewerage system within the city of Prince Rupert dates back to the early 1900s and is divided into ten sewerage areas, each with a pipe discharge outfall into Prince Rupert Harbour. The majority of this wastewater is currently discharged into the harbour without any treatment. New federal wastewater regulations have required the city to develop a wastewater treatment strategy prior to discharge. The city is presently working on the third stage of its liquid waste management plan, which will forecast the timelines and financial commitments toward sewage treatment.

The capital cost of treatment for the city of Prince Rupert is estimated at $130 million to $150 million with the existing sewerage footprint.

The city of Prince Rupert's transportation network consists of approximately 62 kilometres of road, four traffic bridges — three of which are wooden — and numerous stacked rock retaining walls. The majority of the city's roads are rated in poor condition, with over 58 percent of them over 25 years old. The city's three wooden trestle bridges are each over 70 years old and beyond their original life expectancy. Although the city has every bridge inspected annually and performs all the maintenance required to keep them in working order, these bridges are on borrowed time and need to be replaced or alternative routing considered.

Due to the city's geography, the transportation network is especially complicated, necessitating retaining walls. Many of the older retaining walls were constructed of stacked rock. These materials are no longer considered to meet structural code requirements, and the walls are costly to replace.

The overall rehabilitation of the road network, including the bridges, has recently been estimated to be $85 million. The bridges alone are $9 million. The road network is critical for the economy and liveability of the community.

The city of Prince Rupert owns and operates its landfill site eight kilometres from town on Ridley Island road. This landfill was commissioned in 1991 and has a lifespan of approximately 100 years, depending on waste intake volumes. The Prince Rupert landfill has been operating on its current footprint for many years, and the air space within this footprint is now completely exhausted.

The waste intake rate was relatively constant for years. However, the volumes are increasing due to regional development, home renovations, more stringent wood-burning policies and bans, multiple commercial building fires and multiple residential home demolitions.

While future waste generation for Prince Rupert and the region will depend on the amount of growth that is expected or experienced with the potential LNG and container terminal projects, at the present rate of air space consumption, in order to keep the landfill operational and maintain the current level of service, the city of Prince Rupert will need to develop the next phase of the landfill within five years at a cost of approximately $7 million.

Airport access is of great concern in our community,
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especially with the potential wave of development. The city operates a car ferry from Fairview Bay at the south end of the city to Digby Island, where the airport is located. This ferry services several scheduled flights a day and is a vital link for the community. Both of the airport ferry docks consist of a single-lane steel vehicle ramp and a small float system that supports the bottom of the ramp to provide a transition onto the ferry. This system was originally installed in 1959 and now has a reduced weight limit due to its age and is in constant need of repair.

The current 198-tonne ferry carries approximately 12 vehicles. It makes up to ten return trips per day, depending mainly on flight schedules, and is moored overnight at the Fairview dock. Due to their age and the extreme environment in which they are situated, this essential infrastructure is in need of rehabilitation. However, with the potential hyper-economic activity, it may be more prudent to replace and upgrade the infrastructure to ensure that this critical link has uninterrupted capacity for increased service.

This particular transportation piece has been identified as unable to accommodate the expected fly-in and fly-out construction for LNG. As a result, this is one of the more immediate challenges faced in need of a relevant and sustainable solution. The estimated cost to improve this link is $25 million. It should be noted that the Prince Rupert airport offers the only yearly temperate climate in the region to sustain year-round airport transportation.

At last count there were seven LNG projects proposed in the vicinity of Prince Rupert. Although there will likely only be a few, the impact to the community and the region is substantial. In addition to an economic swell in Prince Rupert, the greater benefit to the province is the projected elimination of the provincial deficit.

Our small region is geographically rich. That is to say, we have the desired landscape via our ports and proximity to the Asian market. In order to make our communities also a desirable part of the feasibility equation, thereby helping to achieve the provincial mandate of reducing the deficit, it is imperative that we work together to solve some of the infrastructure and revenue challenges faced by our community. This is an opportunity for us to solidify the proponents' choice to locate in British Columbia, which will benefit all British Columbians.

M. Morris: Thank you for that. I'm a real booster for rural B.C. and particularly Prince Rupert. I've worked with the municipal government in the past in my role of public safety, and I understand the pressures and whatnot that you're facing.

Very good presentation. I wouldn't mind a copy of it, actually, if you have it available, because you do have some vital information in there that I would certainly use in deliberations.

C. Bomben: I'd be willing to go ahead and e-mail that to the e-mail address. Sure.

C. James (Deputy Chair): Thank you for your presentation. I echo the clarity that you brought around the infrastructure and the work that needs to happen before any kind of development comes in. You've got your hands full in your role as CFO in the community.

I think you pointed out the importance of doing that kind of planning and not expecting that that's just going to occur. I guess I have two questions. One is: have there been any discussions with any of the proponents around any of the infrastructure challenges and what's going on?

And the second one is…. You didn't mention housing. I know it's not related directly to the city, but I'm certainly hearing those concerns in other communities around the pressures in Kitimat, around the pressures in Terrace, and I wondered if you could talk a little bit about what you're hearing in the community around the challenges of housing as well.

C. Bomben: In answer to your first question, we have been in discussions with the proponents. However, given the fact that they have yet to make a final investment decision, they're not actually that forthcoming with any kind of funding, for instance — right? — because if they don't know they're going to be here, they don't want to be spending a bunch of money up front.

In answer to your second question, actually, housing is of principal concern to the city of Prince Rupert. We recently, just last week on Wednesday, had a housing seminar, where we invited numerous people from Prince Rupert — developers, realtors, transition house providers; and B.C. Housing, the ministry, was here as well — to just discuss housing strategy, because we do realize that there is a huge concern. We are very concerned about displacing the marginalized, for instance, and also just providing affordable housing for anyone so that people that do have homes right now aren't forced out.

We've already heard of countless renovictions, which we've now called it. I'm sure that you've heard about this in other communities as well in this area. It's something that we identify as one of our indicators of impacts to the community should LNG actually occur.

C. James (Deputy Chair): Just one quick follow-up, continuing on around discussions. Have you been having discussions with the government as well? I recognize this is part of that discussion, but have you been having
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discussions around the infrastructure needs and the work that needs to be done ahead of time?

C. Bomben: Yes, we have actually had conversations with B.C. Housing. And at the upcoming UBCM convention next week, we will be providing a few briefs to responsible ministries.

S. Hamilton: You just commented on something I wanted to bring up, and that's UBCM, and I was going to question whether or not you were planning to participate. So I would imagine you're putting together meetings with specific ministers, and you're going to present the same sort of material to them, so that will go a long way to resonate the concerns of the community.

I come from Delta, so I understand the pressures that a lot of port activity can put on a community. The federal government often comes to the table. We've looked at Prince Rupert for many, many years. At least people in Delta and Port Metro Vancouver area have looked at Prince Rupert as sort of that catch basin that's going to be ramping up and coming up to speed and essentially taking on a lot more activity because we do have a limited area for growth in the Lower Mainland, the greater Vancouver area.

What's the federal government's participation been in terms of this infrastructure deficit that you're concerned with? Quite often they come forward with grants. I know that there are grants in lieu of taxes and that sort of thing. We suffer from the same issue when it comes to not being recipients of an appropriate amount of taxation from the feds because of the new rules in place. What sort of discussions have taken place at the federal level?

C. Bomben: We have currently applied for the Building Canada funding, and that is principally the main focus that we've been going towards with infrastructure. I actually rely on our engineering coordinator to find most of the federal grants, and he works actively on that. But as far as I understand, we keep getting told that really, the best spot for us to go right now is Build Canada funding, although we are aware that 3P is also an option.

S. Hamilton: Right, thank you. Just one more question with regard to that. What's your number one ask? It's a big list. If you had to pick one thing off that list, what would it be? I mean, water supply is obviously very important.

C. Bomben: For livability in the community, clearly, water is the biggest one, because that is life-sustaining. However, after that, if you start looking at the other users, potentially like LNG, they're not going to be quite as concerned about the water. They're going to be more concerned about getting their asset built through airport transportation. So that might be the next one.

We have to do the liquid waste management plan regardless of whether or not LNG arrives or any other expansion in any other kind of export facility actually occurs. That is one that we definitely have to tackle regardless.

If we start looking at it on a timeline scale, airport transportation is probably one of the other ones. But water supply, clearly, for health and safety is our number one.

S. Hamilton: I actually made that comment to some gentleman from the port last year when we were up here, that the biggest single drawback is having an airport on an island. It represents some significant logistical challenges.

Well, thank you very much for coming this morning — greatly appreciate it. You will forward us that. We have the Hansard transcript, but a hard copy would be greatly appreciated also.

Prince Rupert Port Authority — Ken Veldman. Good morning. How are you this morning?

D. Ashton (Chair): A ten-minute presentation is allotted. I'll give you a two-minute warning if it looks like you're going to get into that margin of time, and then we've allotted five minutes for questions from the committee. Ken, the floor is yours.

Just in terms of giving a bit of background and context, the port authority is not a federal government agency. Rather, we are an independent organization mandated by the federal government to steward their federal Crown lands in support of the national trade agenda — that's a pretty significant distinction — and furthermore, to do that in a commercially self-sufficient manner. We do not receive funding from the federal government. Rather, all of our revenues come from our operations.

We currently have five primary terminals or lines of business. We're in the cruise industries through Northland terminal. We're in the container intermodal business through the Fairview Container Terminal, and one of our largest exports through that is northern B.C.
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Forest Products. We're in the bulk industry in three terminals. One is in energy and coal at Ridley Terminals, we're in the agrifood industry through Prince Rupert Grain, and we're in the biofuels industry through a new terminal run by Pinnacle Renewable Energy. That's a wood pellet terminal.

Our success is B.C.'s success. We did over 23 million tonnes of cargo through the port in 2013. That's an estimated $6 billion in Canadian exports. It provides about 2,200 direct jobs in the B.C. supply chain and over $11 million in taxes to the provincial government on an annual basis.

We're currently completing a $90 million infrastructure investment, the road-rail utility corridor on Ridley Island, to anchor the port's 2020 development plan and our future growth capacity. In that project the provincial government invested $15 million.

We're very much in an expansion mode right now. Looking at existing terminals, Ridley Terminals is completing their expansion program, which would double their capacity from 12 million tonnes to 24 million tonnes annually; Fairview, the container terminal, is set to move forward pending a final decision by Maher Terminals that would increase its capacity by 500,000 TEUs; and we are obviously looking at a number of new terminals in Prince Rupert as well.

In fact, in excess of $25 billion in capital expansion is currently under investigation on port lands, including two LNG projects; a dry bulk terminal in the form of potash; break-bulk handling capacity that would support expansion in other projects in western Canada; and that's not to mention several other LNG projects, as Ms. Bomben noted, in the area around Prince Rupert. Those are not on federal Crown land, but we would be involved from a marine perspective.

What are we doing as a port to prepare, aside from working with these proponents, to advance their projects? One, we're planning for growth in ship traffic to ensure we can maintain and enhance navigational safety and security. Our current ship traffic numbers about 500 vessels a year. We expect in a high-case scenario, if this entire portfolio was to move forward, that would increase to about 2,000 deep-sea ship visits on an annual basis.

We're strengthening environmental stewardship programming to anchor sustainability through this period of growth, and we're building and maintaining a local understanding of our activities through effective engagement and demonstrating the positive economic impact of not only the gateway economy — local jobs, local tax base, local quality of life — but also the economic value of the trade that it underpins and how this enhances economic development in many communities throughout B.C. and, indeed, western Canada.

I hope I've painted a picture of success, because there has been much to appreciate to date. But I also hope I've painted a picture of a future that's following a planned, practical, sustainable development path that benefits the province as a whole.

We're continuing to increase seaport capacity on the west coast of North America, and it's critical. It's a critical trade issue not only for B.C. but for Canada right now. Our capacity for growth, our land for development and our local support for industry provide the ingredients for a long-term, market-based, market-financed solution.

Let me make the following recommendations on behalf of the port authority to the provincial government to assist the realization of this opportunity and secure a financial return to government.

One, maintain strategic leadership in the development of trade corridors for the B.C. economy. Timely policy, strategic investment and critical infrastructure enhances the competitiveness of the Prince Rupert gateway, its associated northern trade corridor and the B.C. export industries that depend on it.

A great example of this investment is the common-user infrastructure known as the road-rail utility corridor and its strategic multi-industry focus, its multiple investment partners and its infrastructure that supports and enables private sector investment in new terminals and facilities. The continued maintenance of a competitive taxation environment that encourages private sector investment decisions is of paramount importance.

Two, integrated land planning and land access. A key to current and future growth in Prince Rupert will be the integration of additional provincial Crown lands adjacent to the port into gateway development planning. Successful planning will ensure that no individual project will impair the performance of existing or future operations or impair the effectiveness and integration of the gateway as a whole.

It will also mitigate the impact of port activities on surrounding communities in this region. It is much more efficient and much more affordable to plan and design the front end than spending billions of dollars to eke out incremental efficiency gains later.

Three, recognize the challenge — and I'll echo Ms. Bomben's remarks here — that many northern communities may face as they deal with growth issues, whether they be related to economic, social or infrastructure matters. As we realize the opportunity that's before us, our collective ability to manage their growth will have a direct impact on its success.

Many northern communities are on the cusp of significant growth and will grapple to deal with some of these aspects of rapid change. A poor economic decade makes them particularly ill-equipped to deal with them.

We have a role to play, but we can't do it on our own. The port authority believes the commitment to our communities will need to be shared by all of our public and private sector partners. We need strategic partnerships and investments that enhance public health, safety, edu-
[ Page 759 ]
cation and training, congestion, municipal government efficiency and quality of life.

Our growth to date has largely been within the existing capacity of the system, but as we look at facilitating private sector investment in new terminals and new infrastructure, the certainty of the major project review process becomes critical, and this is our fourth recommendation.

Any lack of certainty around standards and timeline infuses risk into the investment equation. It impairs the probability of a final investment decision. It impairs the ability for all of us to plan for it. Capital is global. It has choices globally. It reacts to windows of opportunity.

I want to be clear that we're not advocating for anything less than world-class standards for environmental, health and safety concerns.

The public trust in regulatory agencies and their rigour is paramount to their effectiveness, but a clear, relevant, evidence-based review process that offers a reasonable level of predictability is critical. More resources dedicated to integrating, refining and supporting those processes should be viewed as an investment with a significant promise of return.

In conclusion, Canada's port assets, including Vancouver, including Prince Rupert, are vital strategic assets for the national and provincial trade agenda and in themselves are foundational drivers of the B.C. economy. In Prince Rupert our capacity for growth, our land for development, and support for the port and the associated industries are providing the ingredients for long-term, market-based, market-financed access solutions.

There is a critical role for the provincial government to play in order to maximize its own long-term revenue opportunities. Sound fiscal fundamentals will provide the economic stability that is crucial for competitiveness, but more specifically, strategic gateway infrastructure investment, integrated Crown land access and planning, strategic community capacity investments, and resourcing a timely and efficient project assessment and approval framework would be our four recommendations to this panel.

The seeds of success are sown here in Prince Rupert. A strong alignment of interest between the provincial government and the Prince Rupert Port Authority will be a big part of seeing its fruition.

J. Yap: Exciting times for the community. You mentioned 2,200 direct jobs attributable to the port. What did this change from — let's say, going back three years — and what do you expect it to grow to with the potential developments?

K. Veldman: Well, that's a lot of speculation, but let me put it in this context. Those 2,200 direct jobs were from an economic impact study we did in 2011, so it's probably even much more than that. Let's consider that a conservative number. Our growth from 2009 to 2011, which was about ten million tonnes, provided 900 new jobs. That puts it in a little bit of perspective of how important volume and tonnage are to creating employment within the supply chain.

K. Veldman: Into the future? Well, look, on a local basis, you've got…. Each terminal that we're talking about, roundly speaking, would provide about 300 direct jobs. Double that for an indirect perspective. We've worked with the provincial government in terms of population demands, and there's certainly a scenario here that could see our population come back up to about 20,000 people, if a high case scenario is realized.

C. James (Deputy Chair): Thank you for your presentation. I think it fits well with the city of Prince Rupert presentation, where we really need to make sure that that work is done ahead of time. Whether it's one, two or three — or however many the scenario ends up with — plants coming in, that preplanning is critical.

You talk about integration of Crown land. I just wondered: it obviously related to the most recent court case around the First Nations. It's a larger conversation than simply the province and the port. First Nations need to be directly involved as well. I wonder if any of those conversations have begun, because this isn't usually a quick process.

K. Veldman: Oh yeah, we are fully engaged with our local First Nations partners. In fact, there's a strong track record here in Prince Rupert of reaching agreements associated with terminal developments and expansions. We would expect that to continue. Yeah, we realize it's not a simple equation, but it's something that does need a priority focus to actually be able to reach solutions.

Strategic planning. If you look at Ridley Island and the 2020 development plan that's been put in place, it's a very practical integrated strategy. It's very much with an eye on the future and being done in a way that ensures that we have an integrated export platform there to support the province's trade agenda well into the future.

As I mentioned, ensuring that we've got that planning done on the front end is certainly an incentive for investment in terms of proponents knowing what they're coming into and that there's a platform they can plug into — but just as importantly, making sure that we have the right plans and the right investment on the front end, that we're trying to avoid a number of issues that we've seen in more mature ports on the North American west coast.
[ Page 760 ]

G. Heyman: Thank you very much for your thoughtful presentation. I appreciate your pointing out that while decisions around land use and environmental assessment and other forms of assessment need to be efficient and integrated, they also need to be very robust, evidence-based and reliable. I think that the two can coexist.

My question has to do with your…. In a sense, you raised the same problem that Ms. Bomben raised about the infrastructure needs, both the aging nature of them and the need for the future, and the failure — or not failure, but the reluctance — to invest until a final, full investment decision is made. I'm wondering if you, when you talked about partnerships, had anything specific in mind about where the funding would come from — whether it's general revenue, a share of royalties directly from the proponents or any other means of funding the needed infrastructure improvements.

K. Veldman: I don't think I'd be so bold as to suggest what bucket any funding should come from. What I will say is that it's certainly not the responsibility of any one partner in this. It's a realization that whether it be LNG or otherwise, there are many partners that have a lot to gain from these kinds of terminal investments. There needs to be a recognition of what that looks like, making sure that that kind of investment in basic infrastructure and in supporting infrastructure is an investment with an eye on the kind of return that it can bring down the road.

Ken, thank you very much. Greatly appreciated. Thank you for your input. Nice to see entities working together.

D. Ashton (Chair): The process is ten minutes for the presentation. I'll give you a two-minute warning if it looks like it's going impinge into that, and then we have five minutes for questioning from the panel, if the panel does have any questions. Sir, please proceed.

A. Baker: Okay. I'd just like to thank you and say that I'm here on behalf of myself as a citizen of Prince Rupert. I know a lot of people in town, and these opinions generally reflect many of the feelings and thoughts of people in Rupert, although I can only speak for myself.

My topic is whether the people of Prince Rupert will be better off from resource development in this region. From my own experience and the knowledge I have gained investigating this question, I conclude that most residents have not benefited and will not benefit from resource development, especially the proposed LNG projects.

Some skilled workers, mostly from outside Rupert, will benefit in the construction phase and fill a limited number of full-time operational jobs. But for most of us in Rupert the short-term benefits will be outweighed by the environmental damage, the externalities of resource development.

There are structural problems in place which need to be addressed, such as the subsidization of industry and the underfunding of the city. The government also needs to alleviate the social and environmental problems attendant on resource development with a plan and funding to support community services and train workers. In other words, government needs to stop sitting on its hands with its simplistic balance-the-budget approach to programs and services. A skilled workforce requires a social infrastructure, just as the movement of goods requires container ports, railroads and bridges.

As a resident of Lax Kw'alaams for two years and Prince Rupert for 23 years, I have lived through a few good years and many bad years. About 15 years ago the pulp mill closed down. The forest industry collapsed, and the fishing industry began its long decline. Nowadays even the shore workers who work at Canfisco, the last fish plant in town, can hardly get enough stamps to qualify for EI. The grain terminal and RTI continue to ship grain and coal, and the school district and the city are the largest employers.

But Rupert has remained in a recession until today. The town's population of 20,000 has dropped to 13,000. Schools and government offices have closed down, and retailers have gone under. Much of Third Avenue is boarded up. Most of the town is made up of the working poor or people on EI or welfare. First Nations issues are only addressed perfunctorily.

Under these circumstances, you'd think the government would have tried to stop the bleeding with some fiscal stimulus. Not at all. In fact, when the Liberals gained power in 2001, out came the mantra of "Balance the budget."

In 2001, the last time I presented at the standing Finance Committee, this is what I said. This was 13 years ago.

"If there's a rationale for the government's economic policies, it seems to be supply-side economics, which has long…been discredited. Having ignored the failure of supply-side policy and tax cuts, the present government reduced personal income tax by a flat 10 percent. Tax cuts left a hole in public revenues, which resulted in a large deficit. Even though the economy was in a slowdown, the government pushed ahead with their right-wing agenda to balance to the books. This meant cutbacks to social programs and government services. These cutbacks made a bad situation worse and hurt the economy.

I spent the rest of my presentation giving economic reasons in support of these contentions. Unfortunately, the committee had not a single economist on it.
[ Page 761 ]

Even after the financial crisis of 2008, the Liberal government followed the ideology of balancing the books. Were it not for central banks dropping rates, the feds' bailout and the QE program, the world would still be in a deep recession.

Indeed, Martin Wolf — who The Economist characterizes as an influential columnist for the Financial Times and as "required reading for the international financial elite" in the article "Shifts and Shocks" — is highly critical of policy-makers who too quickly tried to balance the books after the 2008 crisis. This has only helped stall worldwide growth, including Rupert's.

You may wonder how I can talk about economic policy in a post-crisis world, when I said I'd keep my eye only on Rupert. Well, it's because they intersect.

I remember sitting in a staff meeting, early in 2008, listening to Don Krusel, the CEO of the port, giving an optimistic presentation on Rupert's future growth with its new container port. When I asked of the looming crisis and whether it would stall stage 2 of the port's expansion, he said the expansion would go ahead. But the crisis was severe, and only recently, with China's expansion and the glut of shale gas on the market, have port projects kicked back into gear.

About three years ago I began to ask myself the question: why are my municipal taxes increasing if Rupert's future seems so bright, so right as rain? I pay about $2,000 a year for my house and about over $1,000 for utilities. My house is only worth less than 200 grand.

Why, with port expansion, did Rupert seem so little different than in the previous, depressed years? Many people were still unemployed. Student numbers were still dropping. Teenagers were still dropping out. The college was close to shutting down. More retailers were shutting their doors. The cruise ship industry was struggling to survive.

The only bright spots were China's growth, high commodity prices and Rupert's location. Logistically, we were a node in the world's container trade. This boded well, but why weren't things getting better?

I contacted the port authority and discovered that the port's tax base is greatly undervalued. This reduced the payment in lieu of taxes — PILT — the port paid to the city of Prince Rupert. The federal Ministry of Transport assessed the port's lands at artificially low prices. Additionally, the province capped tax rates for businesses operating on port lands. Both governments provided subsidies to companies, which they called incentives. Frankly, I'm surprised the Americans haven't sued B.C. and the feds under the NAFTA agreement.

The port at first refused to release their financials. Luckily, the city's treasurer was more forthcoming, and I learned that the port's PILT payment was only about $450,000. I brought the issue up at city council meetings and at an all-candidates meeting before the last election.

In the last few years, the city has sued the port over low PILT payments. It now receives just over $1 million a year, with the port owing an additional $500K. This is still below the tax rate on commercial property in the city. I doubt the city's lawsuit mentioned it, but the port is actually a tax haven, distorting the open market and encouraging businesses to set up on port lands rather than city lands. This, in turn, reduces city revenues.

If the city were paid its fair share of taxes from the port lands, then the city could restore funding to services and non-profit groups in the community and upgrade its run-down infrastructure. This, in turn, would have a multiplier effect on the local economy.

The feds and the province leave the structural distortion in place to attract business, but a rationale for the market taxation on port lands hardly holds water. The proposed LNG projects are investments so huge that slightly lower taxes count for little when other factors have a much greater effect on oil and gas revenues.

For example, on the demand side, the recent Russian pipeline deal to supply China with natural gas at low prices will squeeze the spread between North America and Asia, costing the oil and gas companies millions of dollars in lost profits. On the supply side, cost overruns for pipelines and LNG plants are causing many companies to cut back on expansion plans around the world — let alone the currency difference. Any drop in the Canadian dollar will help oil and gas companies greatly, and vice versa if the Canadian dollar appreciates.

The benefits of subsidizing LNG projects in the northwest, especially with so many companies vying for the right to export their product, seems highly suspect, nor are long-term studies being done by independent economists on the issue.

We are asked to blithely accept Christy Clark's PR clips about the future LNG mecca. They say a rising tide raises all boats, but what about those who can't afford a boat? Why have a boat if the ocean is too polluted to fish, the air is too polluted to breathe and the ocean is too warm for salmon, whose habitats have been damaged by LNG plants at the mouth of the Skeena?

Company workers, shareholders and contractors will benefit from resource development, but why should the rest of us support oil and gas exports, with their accompanying environmental risk, without any real economic benefits? Government already underfunds social services in our town, and not a whisper has been mentioned about putting more money in place.

Last year the city cut back one police officer while Port Ed approved a 3,000-man worksite, which you can see on the drive out to Port Ed. It's already being built. What are these guys going to do when they get their paycheques?

New people to Rupert can't get a doctor or a dentist. They have to go to emergency if they have any kind of health concern. MC Family, or the Ministry of Children and Family Development, is swamped and ineffectual.
[ Page 762 ]
There are very few bona fide counsellors or treatment programs in town. And despite having the lowest literacy rate in the province for students entering kindergarten, the district schools continue to be underfunded.

Rising rents are pushing the unemployed and working poor into substandard housing. The few apprentice programs in place are reaching only a few people.

In short, right-wing government policy is ad hoc — set by business leaders and the market, with little concern for planning or public services. This is not the best approach to take; it is only the most convenient. It may actually be counterproductive. Unless the benefits of LNG exports are shared more equitably with the local community and government improves social services, opposition to LNG will grow and become linked with Enbridge, the other energy megaproject in the northwest.

G. Heyman: Thank you for your presentation. I want to drill down into it a little bit and just test this with you. If, in fact, residents of Prince Rupert saw a fair share of the economic rents for the development — the infrastructure and various services were raised as a result, and environmental standards were both established and enforced so people were assured that the footprint and impact of the development were minimized — is that a positive outcome in your view and, by extension, the view of people that you've talked to that share your views?

A. Baker: Yeah, there's no doubt that if that were to occur, then most people would be on board. At least, I feel that. There would still be people who'd be opposed to it for environmental reasons, like locating one plant out at Lelu there, right at the very mouth. Some people, including myself, would never agree to that under any circumstances.

Generally, what you're saying is true. People can see things are getting better. And if all those things were put into place, then definitely. There'd be much more support from residents of Rupert.

C. James (Deputy Chair): Thank you for your presentation, Arthur. I think there's kind of a theme that's being presented in different kinds of ways today, which really is just around the planning that needs to go in if LNG is going to benefit the entire community and the entire region — the planning that needs to go into infrastructure, to social programs, to the supports that need to be there.

I wonder whether you've seen any opportunity over the last couple of years, when the LNG really has been on the table, for citizens like yourself and others to be engaged in this kind of conversation. Have there been public meetings? Have there been opportunities, whether through council or through LNG or through other venues, for citizens to be able to raise exactly these kinds of issues and how critical they are?

A. Baker: Well, I can only say there have been lots of open meetings. I don't know what's been going on behind closed doors. There have been some agreements put in place with First Nations people — Metlakatla, Port Simpson or Lax Kw'alaams — but I don't know how much the people of Rupert are being listened to, to be honest. It seems to be the big players that are involved.

S. Gibson: Just a quick question. Thank you for your presentation. I think you have some strong arguments here, based on your sentiments or your way of looking at life. I say this with respect. What is your suggestion, then, for economic renewal for Prince Rupert? I didn't really get…. I know you have a critical…. I'll just let you finish.

My question is…. When people are working, when a family's working, everybody's happier. The whole vibrancy of a community is enhanced when more people are working and benefiting financially from a growing economy. So what is your suggestion for improving the economy of Prince Rupert?

A. Baker: Well, the point I'm trying to make is that when you look deeper, beyond the PR clips, the people of Rupert are not really benefiting, getting jobs. That's partly because we really need to invest more in training programs and in education. Kids are dropping out of school. They're not getting the good jobs. Now, I'm not saying there's not a benefit to the larger province and maybe to Canadians, because the workers are coming in from outside the community, for the most part.

I'd say we'd have to put a lot more in place to help people in Prince Rupert, and we need to put a lot more services in place — medical, etc. The point I'm making is that….

S. Gibson: Supplementary. Yes, I think we heard that. Social infrastructure here is struggling — literacy. I think we get that. But my question to you is: how do you see adding economic vibrancy to Prince Rupert if it's not LNG and other resources? Give us some suggestions, please.

A. Baker: All right. The simplest one is to fairly tax the port's economic activities because those revenues are going to run to the city, and then the city can at least spend them within the city. There's a huge amount of money on the table, and there's a huge amount of investment being laid down.

As the gentleman for the port mentioned…. Did he say $50 billion or something? Well, that money is not ending up anywhere…. Hardly any of it's going to the people
[ Page 763 ]
of Rupert. The only benefits are to people who directly work for those companies and shareholders. That, to me, would be the biggest recommendation.

D. Ashton (Chair): Sir, thank you very much for your presentation today. It's greatly appreciated. Thanks, Arthur.

Welcome, ladies. Thank you for coming this morning. The process is that we have ten minutes for the presentation. If it looks like you're going to get close to that, I'll give you a two-minute warning. Then we have five minutes for questions or comments from the panel.

S. Ionita: Hi, my name is Simona Ionita. Originally, I am from Romania. I grew up in Romania. I'm 14 years in Canada, locally in Prince Rupert. I became a volunteer with Kaien Anti-Poverty Society four years ago. This is my second year being the chair for Kaien Anti-Poverty Society.

Today I am here to address one of the big issues weighing down on Prince Rupert, and not just in Prince Rupert. I think it's everywhere in B.C. and in Canada. I'm talking about child poverty.

Coming from a Third World country, coming from Romania, I came to this country, and I really thank you today for where I am and for freedom — because I'm talking about freedom. Today, being a woman, standing in front of you and speaking with not being afraid of it — that is freedom for me, I'm telling you. The second part is the clean air, the fresh water I'm drinking, a piece of bread I have every day on the table. It's for that I'm really thankful, for what I am today.

But the big issue, which I'm seeing every single day, walking on the street, watching TV and the government…. The issue is child poverty. We are in Canada, with the economy and everything, the benefits, the technology that this country is dealing with today. To have a child poverty issue — I think this is a shame for every single person. Start with me, and start with everybody in the government, and then this goes on.

From research that I did in 2010, Canadian statistics state that one in ten Canadians live below the poverty line. Going back, in 1989 someone stood up in the House of Commons pledging to wipe out child poverty by 2000. Today we are in 2014, so 25 years from that time, and we still have children living in poverty.

Today, 2014, there are about two provinces in Canada…. In one — it's British Columbia — there are 4.3 million people living in this beautiful section of Canada called British Columbia. However, B.C. has the highest poverty rate in Canada: 13 percent of the B.C. population — 550,000 — live in poverty. We have the highest child poverty rate in Canada, at 16 percent. Just think about 16 percent of our children in British Columbia living in poverty.

Why? Honestly, I don't think so. I have to let you know this. I'm sure you know better than me. I want to let you know from my experience in life. It's nothing against…. I really want you guys to understand me, though, how I explain myself.

English is my second language. Honestly, coming from a Third World country, I see our pets, our dogs, have a better life with the people who are living with big money. Put a balance of people who have $300,000 income in a house and people who have $25,000 income in a house. That pet is going for medical care to the vet. It's going to the beauty salon. They have the best food ever. A kid in Canada doesn't have that.

What I see today is a shame on us. It really is. Why is this happening? Why here in this country where we're talking about LNG, we're talking about billions of dollars, and we're looking after somebody else in other countries? First, you have to start about our children here. For me, it's killing. I came to this country with a big dream, and what I see today is a big issue — having people in the street begging for money for a cup of coffee, $2. Why is this happening here?

Plus this, we are multicultural. We are people from different countries, and honestly, we come here for freedom. We don't come here to take anybody's lands. We come here to have a job and have quality of life. Like every human — right? — in this world, they deserve to have something like this.

Where I grew up, I grew up with nothing. I know how to grow up on nothing, because I didn't have anything. My family was really poor. My mom put me a piece of bread and a cup of hot water, and I ate that and went to school. There are people here, believe me, today probably doing the same because they are ashamed to come and say: "I don't have money." Coming from Europe, we are proud of who we are, and we don't come outside and beg. That's why I came here. One day maybe you go home and think about my words. "You know, she's right. We have kids who suffer a lot."

Through our organization we have families who are coming and begging for fresh fruit or fresh vegetables because the parents can't afford to go and buy them from the Superstore because — you know what? — they are expensive. We said we want a healthy life. It's not a healthy life anymore — honestly.

T. Luciow: My name is Tammy Luciow, and I thank you all today for coming to our town of Prince Rupert. I just welcome the opportunity to speak to you today. As we said, we are volunteers with Kaien Anti-Poverty Society, and today we want to put our support behind our colleagues across the province, like Dawn Hemingway, the city of Prince George, I believe Abbotsford, the B.C. Association of Social Workers, asking for a social policy framework.
[ Page 764 ]

Every single day I look in the paper, read in the paper every single time I need to do…. We need to look for money here in Rupert. I try to find out what the social assistance rates are, by region, across B.C. I can't find it. This is frustrating. I do not understand how you can have a budget in the absence of a strategic framework. It's like one half is missing.

It's very much the same as in economics, where you now have to consider the environmental cost of something. I say to you, as you referenced this morning: take a look at our beautiful city and look at our crumbling yet still very charming infrastructure and compare it to the social infrastructure here.

I've gone off topic a bit, but as a social…. Professionals in the north and workers in the north — the price we pay…. If I have knee surgery, I pay that flight to Vancouver. If our relatives are sick, we have to find friends that'll take us in. I love Prince Rupert, by the way. It does have a social fabric, but that fabric can only be stretched so far. You are all aware of that. I'm asking, again…. I want to get back on track there, because I know we have limited time.

Why do a budget in the absence of a social framework? I would also say to you: why be afraid of the baseline? Why is it that here on the ground people think unemployment is much higher than we read in the paper? I, myself, have a graduate degree in social policy. I've been unemployed for years working in the north. We travel farther. I've had to travel from Prince George to Haida Gwaii and back looking for work. Imagine what it's like for people who don't have 27 years of experience in their field like I do.

Again, I'm getting off topic because I want to talk to you about the baseline again. Take a measurement. Find out where you are. Set your goals. Set your objectives. You know what? Social policy and the budget that you're working on — it does equate to human lives.

You know what? Here in Prince George we know that price. We pay that price every single day — some of us with our health, some of us by overburdening ourselves with caregiver burnout, some of us because we deal with agencies that are far away in Vancouver and seem unresponsive to our needs or unable to hear us. Again, it does come back to planning. If you are planner, go to the people, right? You go to the people for your mandate. Come to us. Collect your information and data, both qualitative and quantitative, right? You need that qualitative piece.

I thank you so much for listening to us today, because that gives you that little bit of that piece and that full picture of what it looks like. It's really disappointing when I hear economies in the north compared, almost as if across the province it's all equal.

What does it mean to me to make $30,000 here if I have to support extended family, which we all do? I don't think it's an economy that's been looked at carefully enough, because it differs, probably substantially. I know that pop cans, for example, have played a huge part in my life and in the social infrastructure of Prince Rupert. The exchange of pop cans is an interesting thing. We've read about it in the paper.

I don't want to end on that note. I want to just put my word forward again. I just want to say that when you are reporting on poverty statistics, each of those poverty statistics represent a child. So when you're doing the numbers — crunching the numbers, looking at that budget — base the numbers, in part at least, on what the value is of that child's life when that child doesn't have enough food to eat and they're eating in soup kitchens.

S. Gibson: I have some empathy for your remarks. One of the things that I think government is trying to do is create a climate that is kind of ebullient, so there's a lot of opportunity. You mentioned Abbotsford area. I'm from Abbotsford, and I get excited about….

We have a fellow, a neighbour of mine — this is just anecdotal — from Laos. He came here with nothing. He was a boat person. He has built up a little shoe repair business, and he works seven days a week to do that. I admire this guy. He's got probably a better work ethic than I have, to some extent.

There are so many people with so many good stories out there, people who are willing to work hard, immigrants.

The one thing, I think, as a defence…. I don't think government can provide everything, but one thing I'm excited about is that what we're trying to do in government is to create an environment so that people can have that opportunity. Yeah, a lot of people fall between the cracks. I teach First Nations students. Those folks struggle perhaps more than others because of their own issues they've had to deal with and family infrastructure issues.

That's the thing that gets me excited — when someone like you with a master's in social policy can actually use that degree somewhere. But you may have to move to another town. Sometimes people do move around, right? People are coming to the west.

T. Luciow: I'll just respond briefly, because he did mention a gaps analysis. That's right. When you do that budget, you need to ensure that you have closed those
[ Page 765 ]
gaps. And if you haven't, perhaps your budget isn't big enough. But it's up to the society, I think, to decide. You can't provide everything, but you have to balance the two — the rational, the qualitative and quantitative.

C. James (Deputy Chair): Thank you so much. Thank you for your passion, and thank you for your work.

S. Ionita: Carole, actually, just to let you know, I can't believe I see you, like, face to face today. Like, oh my God, really?

A couple of things that I think are really important I just want to touch on in your presentation. One is we often hear people debate the statistics about what the real numbers are around child poverty. I think that gets us away from the discussion. I think it doesn't matter whether you use one measurement or another measurement. The reality is there are too many children living in poverty, and it gets us off the topic when we start discussing it.

The other piece around the economy is that…. I think what you've identified is that there are individuals and families and people, and it can happen to anyone in anyone's life, where they need a hand to be able to access that opportunity. They need a hand up, whether it's training or otherwise.

The one area you didn't touch on that I'd just be curious whether you have anything to say about it is the issue of housing, because we're certainly hearing about the pressures of housing and affordable housing in communities that are starting to see the economic changes, and I wonder whether you have anything to say about housing in Rupert.

S. Ionita: Right now, honestly, I'm just looking at the whole thing, what is happening in Prince Rupert. There are people who are getting so much rich because of the houses, and there are people who don't have a place to live. Pretty soon we're probably going to have people who live in the street or put a tent or something and start living there. This is a big issue right now.

The people don't have a place to live. The place where they lived before…. What they are doing, the people who own the house is they evict them out, they do a little bit of renovation, and they put the price of rent, like, to $1,500 in Prince Rupert right now. I think it's insane, honestly. That's why we're going to have so many people live in poverty and keep suffering before any LNG is going to start.

They don't even start building, for God's sake. Sorry, this is the way I am. We can't afford. We need the money first. We need the structure. We need the economy to come and be built, and then let's see how we can do it.

G. Heyman: Thank you very much for your presentation and for reminding us so strongly about the reality faced by so many people. We all know that children don't live in poverty while their families live in wealth. It doesn't work that way. We also know people who have overcome growing up without a lot of resources, just as we know people who have been defeated by growing up without a lot of resources. We also know people who have been very successful because they grew up with the resources that lead to success.

I don't want to put words in your mouth, but I think part of what you've put forward to us, I believe, is that as we develop a budget and think about the growth of an economy that can in fact provide jobs for people, we also think about the importance of making front-end investments in people who might otherwise not be able to contribute to the economy and might in fact be a net financial drain on society because of the circumstances with which they've grown up.

First of all, is that accurate? And second, are you saying that you're urging us to do ad hoc targeted investments or develop an overall anti-poverty strategy as has been done in other jurisdictions?

T. Luciow: I personally believe in strategy in all instances, whether it's social policy or poverty. They're very similar topics anyways. But I also wanted to just mention to you that in reference to where to target…. Quality of life is measurable. You can measure that. How do you measure that? Take a sample of a population in this city; take a sample of the population in that city; ask them what their quality of life looks like.

Quality of life is very, very hard to change, because you need income. They've found that. I guess that over time, in the different universities and social sciences, they found that it's very hard to change without adding income. However, you can measure it, and you can change it with…. You can measure that change in the delivery of programs and services across very broad populations.

D. Ashton (Chair): Sorry, Simona. I have to cut you off. I'm sorry. I apologize. Everybody's the same. Simona and Tammy, thank you very much.

Next up we have Skeena–Queen Charlotte regional district. We have Des Nobels.
[ Page 766 ]

Des, welcome. Thank you very much for coming. I think I remember the face from last year. Were you here last year?

D. Ashton (Chair): Yeah, that's what I thought. Thank you again and thank you for the hospitality shown in the community. It's always nice to come back. It was a bit of a drive to get in last night, though. We had to go to Terrace.

Ten minutes for the presentation. If it looks like you're going to punch in, I'll give you two minutes' warning, and then we have five minutes allotted for questions or comments. The floor is yours.

D. Nobels: Thank you very much and welcome to Prince Rupert. I'm somewhat surprised to see you this morning. I wasn't sure when I woke up whether or not you had actually made it. The fog came in quite early last night, and I wasn't sure if you were driving out or if you were going to fly. That was going to be a tough one either way, but you've made it, so welcome.

D. Nobels: As you pointed out, I was here last year, and I presented to you on a couple of issues. I would sort of like to build on those issues again, because I think nothing's changed in terms of what I've seen over the last year. If the remarks that I've heard here this morning are any indication, the necessity and the need for what I'm going to speak to, I think, is even greater than it was previously.

First of all, thank you very much to the committee for the work that you did last year. It's my understanding, based upon some of the comments that were placed here and some of the work that you did, that we saw an increase in the amount of money that came forward to the six municipal community structures here in the region in terms of preparation for this boom that we're presently dealing with.

As you recall, last year I put forward that the province had provided us with $150,000 for six municipal structures to try and find some sense in terms of what we were going to have to do with our infrastructure and needs in the region. Subsequent to my discussion here, that went up to over $1 million from the province for those six municipal structures, and that has gone a fair distance further than the $150,000.

Secondly, I'd also like to thank you for the mention of the strategic environmental and economic assessment that I brought forward last year as a point of interest. I felt that the province should be funding a very well funded and wide economic and environmental assessment of the proposed projects in the region. As many people have commented here this morning, we're looking at a significant amount of development, or at least that's the proposal. Whether or not that's the case in the end is another question.

The reality in the meantime, though, is that we're dealing with a major amount of disruption through the region, and that disruption has created issues, as many have pointed out here, from child poverty right through to homelessness.

I'm of the belief that a strategic environmental and economic assessment should have been done prior to the move to bring all of this material in here. We all know that nine LNG projects just aren't going to happen here. From what we've seen around the world, with Australia and Indonesia and some of the issues that have happened there, this just isn't realistic.

What I would suggest is that the province undertake a very detailed environmental and economic assessment of what these projects actually mean. What is feasible, what is sustainable and responsible in terms of what we can develop within the region, and what can we come together with as communities and make work?

As it stands right now, we have many competing developments in the region. We have many that are sort of — maybe, maybe not — coming and going. It creates all this speculative marketing through the region. All sorts of things happen. It doesn't work well.

As local governments, we are expected…. Well, as a matter of fact, we are mandated to act responsibly in terms of how we budget and in terms of how we carry that budget forward. We are now legislated to ensure that we run these things properly.

We're looking at the provincial government and saying to ourselves: "We're held to a fairly high standard, but it would appear that the province itself is not held to the same sort of standard."

We end up with, like I said, nine projects. Does it make it make any sense? No. We have a huge mining development that's taking place here over the next 15 to 20 years as well. Again, I think we need to look very strategically at just what the reality is there. What is feasible? What is responsible?

Once we've done that, then the communities can actually come together and begin to work to make these things function properly for the region. Right now we have an immense division taking place through the region in terms of some of these projects. We have a lot of people very opposed to specific projects, others highly in favour of, but there doesn't seem to be any unity within the region. This creates problems when you're planning. It's a hell of a job to try and bring all of these diverse groups together when there's no consensus to begin with.

This is why I think governments are tasked with the job of planning prior to, not after, the fact. As such, that allows communities to then develop their needs in conjunction with those plans. That isn't what's taking place.
[ Page 767 ]

What's taking place is a willy-nilly gold rush mentality now that is driving our communities into the dirt. Many of our community members, who have every right to be here and have been here their entire lives, are now having to consider leaving. Leaving why? Because their homes have been removed from them through renovictions, through a range of things that are taking place here that are not in the best interests of this community. As you've heard here today from others, we are not benefiting to the tune that we should be from the development that's taking place in our region.

Here we sit as children of the province, as we are continuously told, and being taken care of by the province. Well, I'll have you know that there are laws in this province against child abuse, and that's how we feel. Many of these communities feel abused.

We were not brought in initially to discuss how this was going to fall out, how we were going to fit into the overall scheme and how we were going to possibly benefit and then disburse those benefits through our communities properly. We haven't had that discussion, and I think it's time to have it.

In terms of further planning in the region, as well, I've been involved over the last five years with a very extensive and intensive marine planning process, both through the Pacific north coast integrated management area — PNCIMA — and through the MaPP, the marine area planning partnership. Both of these processes, I think, are very crucial in terms of how we move forward, both with the development of the region and in terms of how we look after the environment of this region as well. It's an extremely fragile and an extremely diverse environment in which we live here.

Many of the projects that are coming forward…. Petronas — I'll name it by name — on Lelu Island is one that's extremely contentious within the region here. This is right in the midst of the Skeena estuary, and, in many minds, this is the last place you would build this type of industrial structure.

There's a great deal of concern as to what's happening around that marine environment on our doorstep. It's not inseparable from the land. The two of them here meld together. They sort of meld into one, come together, and we benefit from that as a region. This region has always lived off of the forests and the fish that are on our doorsteps. The two are not inseparable. They're one and the same.

Those are economies that were sustainable and will continue to be sustainable into the future, but what has happened is that government has chosen to ignore those two, which always benefited this region substantially, for something bigger and supposedly better — but not necessarily for those people that live in the region.

I would ask the province to very seriously consider, in their budgetary deliberations, the marine planning process and, should the province adopt the process, to ensure that the money is there to implement the process fully — not as we've seen in the past with others, where they've received partial implementation and the rest left sitting on the shelf with absolutely no future whatsoever.

These are extremely important things for the region. I think they encompass much of what we're dealing with in terms of the fallout from the projects that are coming into the region and the development that's being proposed. I think that if we did a proper planning process and if we thought we could do something properly, then the region could come together behind that. You wouldn't have the divisions that exist.

As always, planning is number one. I think that's been a key point here through all the discussions today. You yourselves are well aware of that need, and I think we have fallen somewhat short in terms of our planning around this development. We have let industry decide how they are going to develop, and that is not the way things should be done.

It's time for us to assume the responsibility that we've been seated with as leaders, and it's time to put people before profits.

G. Heyman: Thank you very much for the points you raised in your presentation, particularly reminding us about the marine area planning process. I made some notes about that.

I just wonder if you have some specific recommendations around how government can set up a process with communities, and the people in communities, that is timely but does engage people early on in defining the parameters of development when something as significant as LNG or an expansion of mining in an area is being contemplated and promoted.

D. Nobels: Well, both of these processes — both PNCIMA and MaPP — have been extremely informative on one level. The PNCIMA process, which was a federally led process initially, collapsed. It collapsed for a number of reasons. The primary reason is essentially that industry was very unhappy with what they were seeing developing. They saw restrictions being placed on them, and they saw that they would, in turn, have to go to people other than the government for sanction with regard to some of the projects they were putting forward. On the basis of lobbying in Ottawa, PNCIMA has basically been sitting on the shelf.

Out of PNCIMA was born MaPP. MaPP was the province, First Nations and lo-
[ Page 768 ]
cal communities coming together and saying: "You know what? We need to plan, whether the feds are willing to cooperate or not." So the move was pushed forward, and the province, First Nations and local communities have come together in what we saw as a collaborative governance structure. That is what's really important in terms of this.

PNCIMA was originally billed as a collaborative governance structure as well. That is why many of us bought into it. We've been in many previous processes. I've been involved for over 30 years in many of the marine advisory structures, and they've never had that collaborative component. The feds came to us, stating that this would be collaborative. It would be a bottom-up process, as opposed to a top-down. As such, we felt that there was some good reason to be a part of those discussions and to ensure that that was fully explored.

Subsequent to that, though, MaPP didn't have the federal component and, as such, left us somewhat high and dry, to be perfectly honest, because the feds, of course, have the jurisdiction over federal waters. So the province has limited scope within that structure.

That being said, though, we do believe that the collaborative nature of MaPP does make it a very integral component in terms of any further planning in the region with First Nations, the province and local governments. We think that there is a substantial opportunity there to actually begin to decide what is reasonable, what is rational and what is responsible in terms of development within the region.

One of the things I would suggest, though — and this has been the downfall of many of these processes — is the availability of end run in terms of the process itself. Those who have not felt that they received the dues that they were warranted at the table have chosen, in turn, to end-run the process, going to the back doors in Ottawa, knocking on those doors and saying: "Listen. We have a problem with this. You need to fix it."

We have for years been telling government: "If you set these tables up, then you ensure that everyone understands that these are the tables at which those decisions are made. You do not come back to us and lobby later on for a change to those decisions. If you need those decisions made, then you negotiate those decisions at the table with your fellow negotiators and with your fellow people at the table." That's never been the case in the past, and that is the only way that any of these processes will actually have any legitimacy and move forward with some surety.

D. Nobels: Ah, very good question. We'd like to know that ourselves. At present we've heard nothing from them around PNCIMA. It's sat dead. To be perfectly honest, the marine transportation sector in this country has done a very good job of ensuring that it was shelved for the long term.

G. Heyman: Well, I will make the comment, and you'll correct me if I'm wrong, that my understanding is that the federal government very purposefully killed the Pacific north coast integrated management agreement discussions.

D. Ashton (Chair): Okay. Well, thank you. Des, thank you very much for coming today — greatly appreciated.

D. Nobels: Thank you very much, and enjoy the rest of your day here. I hope the fog lifts.

D. Ashton (Chair): Well, we have a vehicle to go back. Thanks again for coming. See you, Des. Thank you.

At this point in time we don't have anybody else in the gallery, so I will adjourn the meeting.

Access to on-line versions of the report of proceedings (Hansard)
and webcasts of committee proceedings is available on the Internet.

1) North Coast Literacy Now	Elizabeth Wilson
2) City of Prince Rupert	Corinne Bomben
3) Prince Rupert Port Authority	Ken Veldman
4) Arthur Baker
5) Kaien Anti-Poverty Society	Simona Ionita
	Tammy Luciow
6) Skeena–Queen Charlotte Regional District	Des Nobels
(Electoral Area 'A')

Chair:	* Dan Ashton (Penticton BC Liberal)
Deputy Chair:	* Carole James (Victoria–Beacon Hill NDP)
Members:	* Eric Foster (Vernon-Monashee BC Liberal)
	* Simon Gibson (Abbotsford-Mission BC Liberal)
	* Wm. Scott Hamilton (Delta North BC Liberal)
	* George Heyman (Vancouver-Fairview NDP)
	Gary Holman (Saanich North and the Islands NDP)
	* Mike Morris (Prince George–Mackenzie BC Liberal)
	Jane Jae Kyung Shin (Burnaby-Lougheed NDP)
	* John Yap (Richmond-Steveston BC Liberal)
	* denotes member present
Clerk:	Susan Sourial
Committee Staff:	Sarah Griffiths (Committees Assistant)

Witnesses:	Arthur Baker
	Corinne Bomben (City of Prince Rupert)
	Simona Ionita (Chair, Kaien Anti-Poverty Society)
	Tammy Luciow (Kaien Anti-Poverty Society)
	Des Nobels (Skeena–Queen Charlotte Regional District)
	Ken Veldman (Prince Rupert Port Authority)
	Elizabeth Wilson (North Coast Literacy Now)

REPORT OF PROCEEDINGS(Hansard)

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES