The committee met at 9 a.m.

[B. D’Eith in the chair.]

B. D’Eith (Chair): Good morning, everyone. My name is Bob D’Eith. I’m the MLA for Maple Ridge–Mission and the Chair of the Select Standing Committee on Finance and Government Services.

We’re pleased to be here in Nelson and would like to begin by recognizing that our meeting today is taking place on the traditional territory of the Sinixt and Ktunaxa people. On behalf of the committee, I’d also like to acknowledge all of those impacted by the wildfires and floods this year and extend our gratitude and appreciation to everyone who came together to support the response.

We’re a committee of the Legislative Assembly, and our membership includes MLAs from all three parties. Every fall we visit communities across the province to meet with British Columbians and to hear about their priorities and ideas for the next provincial budget. This consultation is based on the budget consultation paper that was recently released by the Minister of Finance. For those in the audience, there are copies of the paper available here today for you to refer to.

In addition to these in-person meetings, British Columbians can also provide their thoughts in writing or fill out the on-line survey. The deadline for input is 5 p.m., Monday, October 15, 2018. More information is available on our website at www.leg.bc.ca/cmt/finance. We carefully consider all of the input we receive, and we use it to make recommendations to the Legislative Assembly on what should be prioritized in the next provincial budget. Our report will be available on November 15.

To those of you here today, thank you for taking the time to participate. I know I speak on behalf of all of our committee members when I say that your input is at the heart of the work that we do.

As far as the format today, we have a number of registered guest speakers. Each will have five minutes to speak, followed by five minutes for questions. We’d ask that people please stay to that, because we have a lot of people to hear. There’s also a first-come, first-served open-mike period near the end of the meeting, with five minutes allotted to each speaker. If you would like to speak, please see Mariana at the information table.

Today’s meeting is being recorded and transcribed by Hansard. All audio from our meetings is broadcast live via our website, and a complete transcript will also be posted.

Now I’d like to ask the members of the committee to introduce themselves. I’ll first turn to Deputy Chair Dan Ashton.

D. Ashton (Deputy Chair): Thanks, Mr. Chair. My name is Dan Ashton. I represent the area of Penticton to Peachland. It’s nice to be back in Nelson.

S. Cadieux: I’m Stephanie Cadieux. I’m the MLA for Surrey South.

T. Redies: I’m Tracy Redies. I’m the MLA for Surrey–​White Rock.

P. Milobar: Peter Milobar, MLA for Kamloops–North Thompson.

R. Leonard: I’m Ronna-Rae Leonard. I’m the MLA for Courtenay-Comox, on Vancouver Island.

N. Simons: Nicholas Simons, the MLA for Powell River–​Sunshine Coast.

B. D’Eith (Chair): Great. Assisting the committee today are Jennifer Arril and Mariana Novis from the Parliamentary Committees Office. They keep us on time, on track and well fed.

Steve Weisgerber, our rock star over there, and Amanda Heffelfinger, also a rock star, from Hansard Services, get here before we get here and leave after we get here, and often have to wait for their dinner until they’re all packed up. Thank you so much for all the work you do.

For the first presenter, we have Nelson Kootenay Lake Tourism — Dianna Ducs.

Budget Consultation Presentations

NELSON KOOTENAY LAKE TOURISM

D. Ducs: First, thank you for coming to Nelson. Welcome to Nelson. I am the tourism director for the region from Nelson all the way to Meadow Creek. It is about 100 kilometres all along beautiful Kootenay Lake. If you haven’t explored it, I encourage you to come back when you have a little bit more time and explore it. Thanks for being here in Nelson today.

I have three points that I want to address today — MRDT, transportation and the RMI. Those acronyms, if you don’t know them off the top of your head — you guys have, I’m sure, a head full of information — I can elaborate on. Does anybody need elaboration on those? We’re good? Okay.

[9:05 a.m.]

MRDT, the municipal and regional district tax. We collect 2 percent; we have not moved to the 3 percent. My accommodators feel that we do not need to do it, so we’re staying with the 2 percent. We want to thank you, actually, for some of the movement that you have with the MRDT, in moving it into all accommodations.

We actually had a city plan. We were bringing in all the short-term rentals. We had a $150 fee they paid annually. We actually had a really good bylaw that was going. So when you changed it…. That’s okay. We’re not collecting the $150, but all the accommodators and short-term rentals collecting comes into our bank account eventually. We thank you for creating a fair playing field for all the accommodators. It actually really works for us.

As far as affordable housing goes, the amount that’s going to come in through short-term rental is quite small, probably — we don’t know exactly how many short-term rentals are out there — maybe about $70,000. Putting that towards affordable housing isn’t going to do much, maybe put some doorknobs on the doors and stuff like that.

If there are any other opportunities to assist us with affordable housing, we would look forward to those ideas and working with the government in making that happen. I don’t think this fund is going to make it, and we do need affordable housing. We’re at zero percent. This is a desirable area, all the way along the lake, so we do need more housing for people.

We are a member-based DMO. I have 156 tourism members in this region. When I reach out to them, I want them to be part of our community. The one issue we’re having with the MRDT and the short-term rental is that I no longer can communicate with these new short-term rental people. If any of you have gone on Airbnb, there’s no name. There’s no email. There’s no anything.

If we could somehow get that data, get an email, name or location where they are, from you, that would be highly encouraged. Otherwise, I’m going to have to spend hours trying to find them. I don’t have the staff. It’s a two-woman show that we run here.

Transportation. You’re aware that Greyhound has been cancelled. That is a big issue for us moving people and product in and out of our entire region. We’d love it if there was some sort of assistance from the government with transportation. We are a rural community, so considering that would be extremely appreciated.

There are businesses that are going to try and open up some transportation opportunities. I don’t know how often they’ll be able to run or how frequently and where they’re going to be able to run exactly. We do need some way to move people around — of all incomes and products. I think that would be awesome.

Castlegar Airport — known as cancelgar airport, if you’ve tried to fly in here — trying to get some funding also there to try and get our airport coming and going a little bit better. We sit at about 67 percent of the flights coming and going. However, between the months of October and March, it’s about 23 percent. It’s real tough. That goes back to the Greyhound, being able to move people by bus.

And then the RMI — resort municipality initiative. That has been going on since 2006. Approximately $108 million has been used since then. It was to have expired in 2016, but it’s been extended one year, and now they’ve extended it another three-year term. We are not RMI. That money is going to, as you are aware, resorts.

We are a tourism destination. Kaslo itself is 1,000 people trying so hard to be a tourism destination. They have the SS Moyie up there, restaurants, the Langham theatre. We can’t even afford to put signage to tell people where they are. We cannot get signage on the roads. We have a lot of challenges. The theatre has challenges keeping heated in the wintertime, trying to get a speaker system set up.

What I am requesting is the RMI be redefined — no longer a resort municipality, maybe a rural municipality initiative. Try and support the small communities that need tourism. They need it to be part of their economic viability. If there was some fund, take that RMI, transform it, redefine it and try to support smaller communities. Maybe it’s under 10,000 population. I don’t know what the criteria could be or should be, but I would like that considered, because we need assistance in infrastructure in a lot of our buildings in these small communities and roads.

Revelstoke, for example, used theirs for a splash park and a festival last year. I was appalled that that money was used that way when we can’t even put signs in our communities. I think there’s so much money going out that they didn’t know what to do with it. I’m not picking on Revelstoke. It’s amazing, a favourite destination. But, you know, I think we need to look at, a little bit, what this money’s being used for exactly and reconsider.

Look at that — four seconds over. Nailed it.

B. D’Eith (Chair): Amazing. We should have Smarties or something. You get a Smartie if you hit five minutes.

Thank you very much for your presentation. There’s a lot of really great stuff in there. I can assure you, as far as the Greyhound issue, we’ve heard many times from the Minister of Transportation that it’s a priority. It’s already in the minds of the ministry and the government.

[9:10 a.m.]

Of course, this committee can reiterate, because we’re hearing this a lot. It’s important to bolster the demand from areas like this, so thank you for that.

As far as the Castlegar airport, are you talking about changes to the airport? It’s my understanding that it’s often the weather that actually is the issue, not necessarily the airport. We can’t really change…. It would be nice if we could change the weather but….

D. Ducs: If you could work on the weather, that would be awesome.

B. D’Eith (Chair): The Finance Committee suggests changing the weather.

D. Ducs: It’s the approach equipment. That’s one of them. It’s a technical….

B. D’Eith (Chair): Is it?

D. Ashton (Deputy Chair): The navigation equipment.

B. D’Eith (Chair): Well, we have a pilot with us, so he can advise us on that.

D. Ducs: Oh, there you go. Thank you. Yeah, approach equipment. And then, of course, if we could bring bigger planes in, then we’d need to increase the size of the runway. There are a lot of different considerations.

B. D’Eith (Chair): So there are technical solutions, is what you’re saying. It’s not just the weather.

D. Ducs: Yes. To the best of my knowledge, there are technical solutions.

B. D’Eith (Chair): That’s good to know, because I thought it was a weather issue.

Questions?

T. Redies: Thanks for your presentation. I just wanted to talk to you or get a little bit more clarification around the data challenge you’re having with short-term rentals, Airbnb, and getting that information. It guess it’s probably private information. Airbnb won’t cough it up either.

D. Ducs: True.

T. Redies: Is there any other way you could kind of encourage those people who are doing short-term rentals to give you that information?

D. Ducs: Yeah. Currently I have 56 that have been paying the fee, so I do communicate with them. That’s great. I’ve asked them to continue to communicate with us. “I have your email.” However, there are going to be a lot of new ones. Those 56 are only from Nelson. I don’t have any of the short-term rentals for the rest of the 98 kilometres along the lake.

I don’t know who they are. I could go onto every platform and go onto every Kijiji and try to find them, but that seems a bit silly when the government is actually going to be collecting all of that information. I don’t know what the easy solution is here, but we do want them to part of our tourism community and family.

R. Leonard: Thanks very much for your presentation. I appreciate the challenges around getting signage. In my community, just having how many kilometres to Courtenay and Comox…. It took decades to get that on the highway.

I’m not sure about the rules around the designation for resort municipality, but I do know that at the UBCM we just announced a new program around infrastructure funding — 90 percent and 100 percent around cultural and recreational things. It is something to…. It’s not exactly the be-all and end-all for the kinds of things that you’re looking at, it seems, but it is a recognition that smaller municipalities need a little bit of assistance, a boost.

D. Ducs: Will that be an application-based fund that was just implemented?

R. Leonard: We just heard about it from the Minister of Municipal Affairs and Housing and TransLink. Perhaps the council knows about it.

D. Ducs: Good. That’s a start, for sure.

R. Leonard: I just had a question around how you got the 56 registrations. Is it like a business licence?

D. Ducs: The city of Nelson actually employed a company from the United States to extract the data from all the people that were in Nelson — only in Nelson — so they were able to get that data. Then they sent them letters and said: “You have so much time to apply for your business licence and pay for your tourism fee.” If they didn’t, then they paid a fine. We had 100 percent of people actually getting business licences. That’s pretty good. We were happy with that.

B. D’Eith (Chair): Excellent. Thank you very much for your presentation. A very nice way to start the day.

Next up we have Nelson Interfaith Climate Action Collaborative — Barry Nelson and Julia Roberts.

NELSON INTERFAITH
CLIMATE ACTION COLLABORATIVE

J. Roberts: Good morning, committee members. Thank you for having us. We represent the Nelson Interfaith Climate Action Collaborative, which consists of nine faith communities. Five of our members have committed to the 100 Percent Renewable Kootenays initiative launched by the West Kootenay EcoSociety.

[9:15 a.m.]

We view climate change as the most serious threat facing humankind. Here in B.C. we urgently need to reduce greenhouse gas emissions while adapting to the impacts of climate change that are already occurring.

B. Nelson: I say good morning as well.

One of the steps to reducing GHGs is to provide alternative transportation. What we find here, when we stand at bus stops and so forth and watch cars go by, is just about every one is single occupancy. We do know from B.C. government information that 14 percent of greenhouse gas emissions in our province come from vehicles.

One of the things that impressed us was the amount of money that has recently been committed by the provincial government and by the federal government to excellent transportation in the Lower Mainland, particularly in Surrey and Vancouver.

Also, in 2013, there was quite a revision of the local transportation to a regional system rather than just individual cities, and that has provided significant increases in ridership — in the Trail area at 8 percent and in the Nelson area at 10 percent, which is quite significant. With more improvements, we know that that would increase. There’s just no question about it.

Rural people in our area find it difficult to not have a vehicle, because of having to travel distances. Without good transportation by buses, they have to have that vehicle. In Nelson, in most small communities, in any community in B.C. now…. The costs for accommodation are very high in most cities. Certainly in Nelson, they are. People that are on low income or have disabilities find it difficult to reside in the community, so they have to live in the rural areas — therefore the need for excellent transportation throughout the system.

J. Roberts: Last fall our collaborative began looking at ways to reduce greenhouse gas emissions for travel to faith community events. We conducted a survey around demand for Sunday bus service, which is something we don’t have. And 67 percent of the respondents said that they would take the bus to Sunday services, and 78 percent said that they would take the bus to other activities.

Next we discovered that the Nelson CARES advocacy group, which works with people with disabilities, was circulating a petition for the return of Sunday bus service, and we worked with them on that, getting signatures. In all, we got 1,515 signatures from across our regional transit area, which is Nelson, Castlegar, Trail and adjacent rural areas.

The other thing we looked at was what happens with transit in terms of reducing greenhouse gas emissions. I’m a retired environmental technologist, and I happen to have some experience with calculating this kind of stuff. If you can fill buses, the buses that we have around here, their emissions range from 31 to 43 grams of carbon dioxide per passenger kilometre. If you look on line at vehicles, they range from 200 to 300 grams. So just by getting people on the bus you can probably reduce emissions by about 85 percent.

Those really add up. We found that if you just looked at one return trip with some of our longer bus routes, operating just on regular work days through the year, you could save anywhere from 44 to 127 tonnes of carbon dioxide over the year. Obviously, if we looked at all the trips, the savings would be even greater.

B. Nelson: So how much is it going to cost? What we did is we got some help from the city of Nelson, providing us detailed information about the cost to operate the regional system. We looked at, from the standpoint of Sunday service…. Determining that, if we used the Saturday service numbers, which we do have, and used the same figures, it would cost approximately $400,000 annually.

[9:20 a.m.]

Now, we do know that B.C. Transit, which is the corporation that provides subsidy to rural communities outside of the major cities…. They pay 47 percent of that total, so that amounts to almost $200,000. This would cover a population area of 75,000 plus in the area. If you divide that into the number of people, it’s about $5 for the total cost per person, but B.C. Transit could provide that for a cup of coffee a year.

J. Roberts: Basically, our request is that B.C. Transit have the budget to fund the reinstatement of Sunday bus service. We also think that to achieve maximum greenhouse gas reductions, there also needs to be budget for education and awareness programs to increase ridership.

Thank you very much for your time and attention.

B. D’Eith (Chair): Thank you very much.

Questions?

D. Ashton (Deputy Chair): So 75,000 people in your regional district here.

B. Nelson: It covers two regional districts.

D. Ashton (Deputy Chair): This is Boundary?

B. Nelson: Yes.

J. Roberts: It’s all of RDCK but only part of Kootenay-Boundary.

D. Ashton (Deputy Chair): Which part — up to Grand Forks?

J. Roberts: No, the bus service that we have goes to Trail, Rossland and Fruitvale. The rest of it is here in Central Kootenay.

D. Ashton (Deputy Chair): It’s 75,000 in that gathering area, then, eh? Okay, thank you.

R. Leonard: Thank you for your presentation.

Question. How long has it been since you’ve had Sunday service, or have you never had Sunday service?

B. Nelson: In Nelson, we’ve had Sunday service. The rest of the system has never had Sunday service. In Nelson, it was in 2012, I believe, when that was cancelled.

R. Leonard: What is the ridership on a Saturday? I just know that one of the drivers of usage is the frequency, and obviously, with 75,000, you’re not going to be able to have it every 15 minutes.

B. Nelson: No. Actually, the Saturday service is only approximately every 1½ hours. Also, it stops at 6:30. So if you go to a movie, you walk home.

B. D’Eith (Chair): Great. Well, thank you very much for your presentation. We appreciate you taking the time.

Next up we have Citizens Climate Lobby. We have Judy O’Leary and Laura Sacks.

CITIZENS CLIMATE LOBBY

J. O’Leary: Good morning. Thank you for this opportunity. Citizens Climate Lobby is an international organization, with a big presence in B.C. We’re a non-profit, non-partisan grassroots organization, and our focus is climate change and the political will for a livable planet.

You’ll be happy to know we’re not going to ask you for any more money, any funding. Our focus today is on two revenue issues. I’ll speak about one. The first one is what we see as a significant loss of revenue from supports for fossil fuel industries without much return for that. The second is lack of transparency on carbon tax revenues. I’ll speak about the first.

We feel that the government is actually working against its greenhouse gas targets, which you legislated, by strongly incentivizing fossil fuel use and production in a number of ways. One is through tax and royalty credits. The second is through carbon tax exemptions. The third is through fuel tax rebates.

We’ve done quite a bit of research on these, and we’ve been in communication since January with Energy, Mines and Petroleum Resources and since May with Finance. What we’ve found are a number of things. First, Energy, Mines and Petroleum Resources has been very generous with their staff time, and they have confirmed annual royalty credits of about half a billion a year. That’s billion — every year. That does not include any planned assistance for LNG.

[9:25 a.m.]

We understand that these are there to incentivize natural gas production, but it’s our position that these revenue losses are not really warranted. Gas royalties totalled only $145 million this year, and employment in oil and gas in B.C. represents only 1.2 percent of employment. We feel that for those big revenue losses, you aren’t getting much bang for your buck. You might have other ideas on how to spend that money.

Secondly, the Pembina Institute has estimated carbon tax exemptions for fugitive and vented methane at $150 million. We believe that additional carbon tax exemptions and fuel rebates bring these total revenue losses up to $1 billion per year, but we’re waiting for some confirmation from Finance on some of those numbers. We’ve sent you some details in writing.

In comparison to these really high revenue losses, expen­ditures on clean energy have been confirmed by Energy, Mines and Petroleum Resources at $43 million per year, of which $40 million is a one-time expenditure. We do appreciate that extra $10 million that was just put out.

On this issue, two recommendations: first, that the B.C. government start to phase out the royalty and tax credits for this well-established industry and start to phase out carbon tax exemptions and fuel tax rebates and shift those revenues over to a transition to clean energy and other priorities which you may have.

L. Sacks: Our next topic is about B.C. carbon tax and the need for better transparency and communication. Our carbon tax is among the best in North America, and we strongly support that it’s once again increasing. However, many British Columbians do not understand how it works and where the revenue goes, and most are unaware that other taxes are reduced to offset the carbon tax.

In order to protect the integrity of the carbon tax, we need better communication about how it works, what’s exempted and how the revenue is being used. Without better communication, B.C.’s carbon pricing is vulnerable to coming under attack as being “a tax grab,” as it is happening across the country.

In 2017, the revenue-neutrality requirement was removed. According to the B.C. government’s website, new revenue generated from the carbon tax increase will be used to provide carbon tax relief and protect affordability, maintain industry competitiveness and encourage new green initia­tives.

When we reviewed the latest budget and fiscal document plan, it is not clear what portion of the new revenue from the carbon tax increase is going to each of those three categories, nor what green initiatives will be funded or how that decision process will be made. It’s also not clear how the rest of the revenue, presumably the $30 out of the $35 per tonne carbon tax, will be used. For example, will boutique tax cuts, like those to the film industry, still be done with carbon tax revenue?

We couldn’t find answers to any of those questions when we looked through that document, although we saw stated on page 75 that “the Ministry of Finance and the Ministry of Environment and Climate Change Strategy commit to on­going transparency on the spending of carbon tax revenues.”

We have three recommendations. The first is to include the line-item expenditures for the carbon tax revenue in the budgets, including corporate and personal income tax reductions, low-income tax credits and other tax cuts as well as specific industrial incentives and details on green initiatives. Second, develop a communications strategy to educate the public on the purpose of the carbon tax, an explanation of how the revenue is used and why. Lastly, include fugitive and vented methane in the tax and phase out other exemptions to incentivize low-carbon solutions. Thank you.

B. D’Eith (Chair): Great. Thank you very much.

Questions from the committee?

P. Milobar: Thanks for the presentation. Nice to hear from you again. I’ll just say I have to agree. We’ve been trying to find those same numbers out as well, so we’ll let you know if we find anything as well.

D. Ashton (Deputy Chair): Just quickly, I looked you up. The American…. It’s a parent organization based in California. Is there a Canadian arm?

L. Sacks: Yes. If you look at the actual canada.citizens­climate.org, you’ll find us. That’s the U.S. website.

D. Ashton (Deputy Chair): But you work together, I’m assuming.

L. Sacks: We collaborate and communicate.

D. Ashton (Deputy Chair): Donations? So if a person was to donate, you can donate to the Canadian one, where organizations like yourself get some of that revenue.

L. Sacks: You can donate separately. They’re very separate, financially separate.

D. Ashton (Deputy Chair): Perfect.

L. Sacks: In fact, we are almost 100 percent volunteer-driven in Canada. There is one staff that is international — works internationally in other countries as well as in Canada. But our finances are completely separate.

D. Ashton (Deputy Chair): Okay. Keep up the good work. Thank you.

[9:30 a.m.]

N. Simons: Thank you very much for your presentation. Over the course of our deliberations, we’ve heard witnesses talk about the need to get rid of the carbon tax quite often. Do you think it’s the government’s responsibility to sell the virtues of that tax? Or is that at some point, government puts out the policy, implements it, and there it is? I can imagine if we were spend money on advertising the carbon tax, we’d probably hear from people about that.

L. Sacks: Why don’t you mention the example that you have that went with the rebate?

J. O’Leary: I got one insert from the government — you’ll see in our written documentation — that was sent out by a federal mailing just explaining it. Our position isn’t so much that the government should advertise and promote it. But it needs to explain it and make it really clear to people what it’s accomplishing and where those revenues go.

I think most of the attacks coming on the carbon price right now are because people think all the money just goes right into general revenue. Under the previous government, they actually made it pretty clear where it all went. We might not agree with that previous government on everything, but they did make it really clear where all the revenues went.

Now it has become quite muddied, and I think you are at risk of being in the same situation as other provinces where they say, “Oh, it’s just a tax grab. You just want more money,” and: “What are you accomplishing with it?”

I think the government has a responsibility to answer both of those questions and make that clear to the public.

B. D’Eith (Chair): I was actually really pleased to hear that the electric vehicle incentive program was renewed, which is great. But I know that in rural areas, it’s a lot tougher. People don’t tend to buy electric vehicles.

We just heard about trying to increase bus services and other things. I don’t mean to get off topic, but I’m just curious. In terms of climate change, I’d like to know, in the more rural areas, what measures you think would be important for the government.

I mean, in an urban area, things like an electric vehicle tax incentive makes sense, because people can do that. But are there other things — other than, let’s say, the carbon tax — that you feel we can do in the rural areas to ensure that we’re dealing with our climate change?

L. Sacks: Well, first of all, we do have an exciting new program here called Accelerate Kootenays that’s increasing the electric vehicle charging stations. Getting electric vehicles here for people to buy is one of the big challenges. I think there is a lot of demand for that, especially now that we can move within our region with charging stations.

The public transit issue — night time. I live rurally. I drive a Prius, but I still had to use fossil fuels to come here today, because the bus didn’t quite work with my schedule.

There are a lot of programs that can be improved on for retrofitting existing buildings and making that easier, I think. There are some incentive programs through Fortis and through Nelson Hydro, but I think that those could be improved, as well, and create a lot of jobs, if we can only get it moving.

B. D’Eith (Chair): Great.

J. O’Leary: I’ll just add to that briefly. You would have so much revenue to work on that if you would start to phase out those very generous subsidies that are there for the fossil fuel industry. That’s massive. We see a great opportunity there for that revenue to go to some of the other needs that you’re probably hearing about.

B. D’Eith (Chair): Great. Thank you very much for your presentation. We really appreciate it.

Next we have Selkirk College Faculty Association — Lui Marinelli.

Welcome.

SELKIRK COLLEGE FACULTY ASSOCIATION

L. Marinelli: Thank you to the committee for allowing me to speak. I’m the president of the faculty association at Selkirk College.

Selkirk College is a regional post-secondary education here that services the West Kootenays. The next nearest one is in Kamloops and then Kelowna, so we have a fairly large catchment area providing education to a fairly large student population.

What I wanted to speak to had to do, generally, with the funding to post-secondary institutions.

I think since 2002, when the tuition freeze came off, our institution — as a lot of other institutions — has regularly increased tuition to students the maximum of 2 percent every year. Certainly, our institution has done that quite consistently.

[9:35 a.m.]

Around the same time, or a little after that, with the previous government, there were regular cutbacks for funding to the institution. Certainly, some of these increases in tuition offset some of those. But these are coming, obviously, on the backs of students — the ones who can least afford these kinds of extra burdens.

At the post-secondary level, this is the opportunity for students to investigate, search and find out the things that they really would like to do. For some, the increased burden of the tuition increases means that they don’t come to school and don’t complete their education. Many of them will leave with fairly large burdens that they’ll have to pay off afterwards.

The second point has to do with international students. There’s been a fairly large mandate from the government a few years ago to increase the number of international students. They’ve been a great multicultural input into our communities. There are a variety of things that are problematic about the approach of how things have been brought in, but the one thing that I wanted to speak to has to do with how, as I’ve been told by our administration, international students are counted.

Whenever it comes to a request from our institution for greater funding, they have to demonstrate that they’re full and that we have reached whatever the capacity is for students, but it only is domestic students that they count. They don’t count international students.

I don’t know, but my guess, from the government’s point of view, is that because of the fairly large international fees that these students have to pay…. That’s offsetting things that you might not be getting, because it’s not another domestic student. However, it doesn’t.

We are really bursting at the seams. At Selkirk College, there are a number of things that we simply cannot offer to students because we don’t have the space to offer that to them. We hear, year after year as we speak with the administration, about the challenges that they have having to deal with not being able to get funding to make our space larger.

There have been a few things that have happened over the years, but it takes quite a bit of time to do that.That’s one of the real concerns. With our institution, it has to do with how they actually count and account for the bums in seats, more importantly, as opposed to whether you’re a domestic versus an international student.

B. D’Eith (Chair): Thank you. Very interesting.

R. Leonard: Thank you very much for your presentation. You’ve introduced a new wrinkle that I wasn’t aware of around the international students and how they’re counted.

The question that keeps coming up in my mind is: how many of the international students end up staying in the communities where they get their education? Do they come to Nelson and remain? Does the college track that sort of information?

L. Marinelli: I don’t know if they do track them. From what we hear from a number of the international students, there are a couple of reasons that they’ve come for. There’s a geriatric program that is all international students and was set up exactly for them. The vast majority of them go back to their country with that education.

There are a number of them, though, that it’s a part of their landed immigrant status that they have to come to an institution for two full years before they can get fast-tracked into getting landed immigrant status in Canada. They potentially are staying, but where they’re staying necessarily — in this community or not — I’m not sure. I don’t know that we’re tracking the number of students that are actually remaining in the community.

R. Leonard: How long have you been at Selkirk College? I have a follow-up question to that.

L. Marinelli: Sure. Next year will be my 20th year.

R. Leonard: So you’ve got some longevity. The question that I have is: with the introduction of international students, have you seen a growth in programs where you actually have enough, you know, that threshold to be able to introduce new programs for students?

[9:40 a.m.]

L. Marinelli: In some areas, yes. But not maybe to the extent that we might have expected. What has happened, for the most part, is that courses that are already offered are becoming larger and larger and becoming more and more challenging for instructors to teach because they’ve just added more students to those courses, as opposed to opening up new ones.

R. Leonard: Okay, thank you.

B. D’Eith (Chair): Can I clarify one issue? In terms of counting the seats, is this more in regard to capital expendi­ture and creating capital, increasing the space? Is that we you’re talking about? Or are you talking about general funding for operations?

L. Marinelli: I think it’s both: general operations, yeah — there is, as we understand, a separate pot of money that they go to when they need to build buildings — but also to be able to offer more courses, which means you have to pay instructors to offer those courses.

The hope is that we get to a point of just offering more funding to post-secondary but also putting a limit on the tuition increases as well. It’s just to offer more opportunities for students to come to the college and, therefore, proposedly, having more courses offered that currently have only one or two students in there. It’s just not feasible to offer those courses, but if you can bring that number up to ten and 12, then we can start offering more and more things.

As I described, we have to be everything to everyone in this region. We can’t be a specialized college. We have to be able to offer all sorts of things, but it’s limiting when you have such a small number of students, and some of them are affected by not being able to come because they simply can’t afford it.

It is quite a bit more reasonable here than it is when you go to university. That’s one of the reasons we’re able to retain students for at least the first few years, but it’s a burden for students who are still making minimum wage. The increases in minimum wage haven’t kept up with the cost of living, haven’t kept up with these tuition increases.

B. D’Eith (Chair): Just before we go to Dan, just a follow-up. I can understand why it makes sense to have international students counted, but you could understand why it shouldn’t be pooled, in a sense. Maybe in the calculation it could be domestic and internationals — separate line items so that you can actually see a number and figure out a way.

The government isn’t going to want to fund international students, per se, because they’re supposed to pay full freight — that’s the idea, in my understanding — or maybe a part of it. I mean, I can understand why it’s not all just put into a pool, but maybe there’s a way to suggest that they could calculate it so that they take into account the international students in a better way, a better manner.

L. Marinelli: Yes, absolutely. As I sort of described it, we talk oftentimes of “bums in seats,” and you only have so many seats, regardless of who take them up. You can account up for it differently, but as long as there’s some accounting for those international students, it would be better than what’s currently happening.

B. D’Eith (Chair): Okay. Perfect.

D. Ashton (Deputy Chair): What percentage of additional fees do I pay at Selkirk, if I’m an international student?

L. Marinelli: Quite honestly, I don’t know the amount that they’re paying.

D. Ashton (Deputy Chair): Cranbrook was 1.5, and other institutions are four times, we’ve heard on this trip. So it’s very broad.

B. D’Eith (Chair): Yeah. It’s been interesting.

D. Ashton (Deputy Chair): Last question. Average number of students per class, ballpark?

L. Marinelli: It ranges all over the map, quite honestly. It’s because we’ll have classes that will have up to 100 students in them. We’re quite limited because we don’t have really large spaces for those ones. I teach down in Castlegar — that’s the main campus — and we have one theatre that can seat just over 100 students in it. Otherwise, the seating that you could pack into a room is maybe 25 to 30.

D. Ashton (Deputy Chair): It’s an average?

L. Marinelli: It’s probably in that ballpark, yeah.

D. Ashton (Deputy Chair): Is your flight program still going or not? Does your flight program still run? It’s cancelled? After Dave Williams left, you cancelled it, or what?

L. Marinelli: No, it was cancelled after…. It’s a few years ago now that it’s been cancelled.

B. D’Eith (Chair): Great. Thank you very much for your time. We really appreciate it.

Next up we have the B.C. Fruit Growers Association — Pinder Dhaliwal and Glen Lucas.

I think, Dan, you’ll probably have to abstain on this one. Aren’t you a member?

D. Ashton (Deputy Chair): Yeah, I should. No questions from me.

B. D’Eith (Chair): Welcome.

We just have this as a guide. If we can try to keep it to five minutes and five minutes for questions so we have time, that would be great.

Thank you so much. Go ahead.

[9:45 a.m.]

B.C. FRUIT GROWERS ASSOCIATION

P. Dhaliwal: Good morning. Thank you for the opportunity to comment on the 2019 provincial budget. My name is Pinder Dhaliwal. I am the president with the B.C. Fruit Growers Association. With me today is Glen Lucas, our general manager.

The budget review is very important to our association and its members. We are pleased to be in the heart of the Columbia River Basin to comment on the 2019 B.C. budget.

G. Lucas: The Columbia River Basin is home to farms which grow the latest-season cherries in the world, and it is home to many fine apple orchards, especially in the Creston area. Tree fruit farming was once more widespread throughout the Columbia River valley. Since the Columbia River Treaty, a long decline took place, probably initiated by the loss of much productive farmland to flooding and the consequent reduction in services and infrastructure that support farming.

The impact of the Columbia River Treaty on the tree fruit and potato and vegetable sectors needs to be recognized and action taken. A first step would be something along the lines of establishing a trust to fund infrastructure and climate change projects for the sectors.

P. Dhaliwal: Our association also supports the province’s ongoing review and negotiations of the updated Columbia River Treaty. We support the province’s position, composed of 14 principles, on the Columbia River Treaty renegotiation, established back in November, 2013.

We know it will probably take many more years to negotiate the next version of the Columbia River Treaty. When the new CRT is finalized, the province will be in a position to account for the impacts of the treaty on B.C. tree fruit and vegetable growers, funded by the equitable sharing of benefits under the treaty.

Our association represents 485 commercial tree fruit growers in the Okanagan, Similkameen, Shuswap and Creston Valley. Our mission is a prosperous, sustainable, innovative tree fruit sector in B.C. that grows products that improve health. Based on the most recent agriculture census of 2016, the family-owned tree fruit farms in B.C. generate roughly $118 million per year, with a packed value of $219 million and $776 million of economic activity annually.

G. Lucas: The province recently provided our sector with a $5 million competitiveness fund, which will be launched very soon. That will encourage infrastructure investments, research in new pest-management practices that are area-wide and integrated pest management, and develop a strategic marketing plan that leads us into a bright new future.

P. Dhaliwal: Going back in time to the 1990 commission inquiry, the commissioner at that time pointed out that Okanagan tree fruit growers need to change over to a higher-value variety and plant more modern and high-density orchards. As a result of that report, the replant program was established.

About every five to ten years, the government reviews the replant program and the same conclusions are reached. In order to renew orchards, growers need to replant trees, and they provide approximately 25 percent of the required investment. This initiative to renew has kept the fields green, both with orchards and with the economic boost it provides.

G. Lucas: The current program recognizes that the longer-term approach is needed for tree fruit. Growers must order from nurseries three years before planting trees, and nurseries must order root stocks two to three years prior to that. A replant program that allows growers a plan to order five to seven years in advance, to have that planning horizon, provides stability and matches the planting times in the tree fruit sector.

P. Dhaliwal: The current program is for the period of 2015 to 2021. Our first budget request is to add four years to the replant program, taking us to 2025. With the price indexed, the funding for the program would be roughly about $1.5 million per year. Growers stand to invest a further $5 million per year in replanting their orchards. This funding extension will match the program with the planting times of the sector and allow us to move the sector ahead strongly to meet market demands and provide jobs and investment in B.C. agriculture.

Now we would like to address the questions in the budget consultation paper.

G. Lucas: Question No. 1 is: “What are your top three priorities to help make life better for you, your family and your community?”

P. Dhaliwal: First, extend the replant program four years to 2025, with $1.5 million per year of government funding, triggering an investment of $5 million per year by the tree fruit growers.

[9:50 a.m.]

Second, make the payroll tax fairer. We understand the employment tax is shifting the cost of Medical Services Plan premiums from the employees to the employers. However, our sector employs about 7,000 foreign guest workers from Mexico and the Caribbean. Under the seasonal agriculture worker program, they are not eligible for the MSP, so why are employers being taxed on their wages? We request an exemption of MSP for foreign workers from the payroll tax. Or, reduce the payroll tax for active farms, as is done with the property tax.

Third, get the federal matching funds to invest in water infrastructure. Climate change is here. In 2017, we had no rain for 100 days, and in 2018, we had no rain for 70 days. When we held a roundtable with farmers in Creston, they identified water supply as their number one priority. The province should be able to leverage federal funds for water supply projects, but federal programs are not aligned for this purpose.

For example, the province has allocated $5 million toward a $10 million irrigation water infrastructure project in Oliver, but the federal government programs do not allow matching, and this essential project is stalled right now.

The federal government has, in the age of climate change, not created any matching funds for projects in water infrastructure. With your help, we could change this deficiency.

G. Lucas: Question 2: “If you had $1 to put toward programs and services across government, how would you choose to divide it?”

P. Dhaliwal: Assuming it’s an extra dollar, the BCFGA would naturally invest in programs and services that help our sector to invest and create economic activity. Therefore, that extra dollar we would divide equally between (1) climate change — invest in water supply and climate change programs; (2) economic development — payroll tax abatement and the replant program to 2025 and debt reduction.

G. Lucas: Question 3: “Given the high levels of demand for government programs and services, how would you pay for the new and enhanced programs and services?”

P. Dhaliwal: The provincial budget shows strong growth in government revenues. This is due to the success of in­dus­try and business. Therefore, ensuring a healthy business climate and programs that provide reasonable taxation and programs for business are key to generating funds to pay for social programs.

Increasing taxation on business and creating high tax jurisdictions may actually reduce government revenues. The current issue is that Canada has, at the federal level, become uncompetitive with the U.S. tax structure. Keep the playing field level and programs that support business and infrastructure — in investment, Canadians and British Columbians will compete with any region in the world. In other words, a strong economy relative to other regions is more important to government revenues than simply increasing the taxation rate.

G. Lucas: There was a fourth question with various objectives on there. In general, we support all the listed objectives. I guess the key for the committee is achieving balance between those different objectives.

P. Dhaliwal: In conclusion, thank you for the committee’s effort in reaching out to all British Columbians. We appreciate your efforts in strengthening the B.C. economy and giving direction to the programs. By investing in replant until 2025 and making the payroll tax fair, we can grow the tree fruit sector and secure its contribution to government reve­nues.

We’re at eight minutes.

B. D’Eith (Chair): Yeah. Can I just clarify a couple of things? One is the replant program right now. What year does it go to? You say, extend it to four years. Is it not…? How far is it going now, and how much more…? Do you need to add another four years? Could you just clarify that for me?

G. Lucas: We’re in the middle of a seven-year program.

B. D’Eith (Chair): Right.

G. Lucas: It started in 2015, so we’ve had ’15-16, ’17-18, and we’ve got three more years — so till 2021. It’s the last year. We’re four years into it. We’d like to add four years now.

D. Ashton (Deputy Chair): It’s oversubscribed.

G. Lucas: It is oversubscribed, and the competitiveness fund that we mentioned provides some ability to be flexible. It will be over some years and under some years. It gives us some flexibility to fill the holes in that.

B. D’Eith (Chair): So we take it to 2025? Is that what you’re saying?

G. Lucas: It ends in 2021.

B. D’Eith (Chair): But you want it to be another….

G. Lucas: We’d like to add to 2025, yeah.

B. D’Eith (Chair): Okay. I just wanted to clarify that, because I wasn’t sure when the timelines were.

The other thing was…. I’m just curious. On an orchard, do you know what the average payroll is? Is it over $1.5 million a year?

G. Lucas: No. We’d have a limited number of farms in that category — in tree fruit, probably less than a handful. But there would be, certainly, some that were impacted, on the sliding scale, that are over the $500,000.

B. D’Eith (Chair): So are you saying a good number of them are in that $500,000 to $1.5 million? Or are still a lot under the $500,000?

G. Lucas: You know, it’s like the 80-20 rule. Eighty percent are probably under $500,000, but the 20 percent that are over probably pay 80 percent of the payroll in the industry.

[9:55 a.m.]

P. Dhaliwal: They’re operating more acreage compared to the small farmers.

B. D’Eith (Chair): So they’re larger operations.

P. Dhaliwal: Yeah, larger operations.

B. D’Eith (Chair): And that’s part of the reason why it’s scaled that way.

Okay. Questions? We’re over time, but that’s fine.

T. Redies: Thanks for your presentation. As the wife of a former orchardist, I have actually a fair amount of knowledge about this business. One of the things that strikes me about the B.C. Fruit Growers is the brand of B.C. The quality of the brand is very strong.

I’m now talking about opportunities. What’s your thought in terms of the ability of the B.C. Fruit Growers to increase exports of our products to other countries, from where it is today?

P. Dhaliwal: Since 2011, export in cherries has increased dramatically. It’s going to China and Korea, and another market just opened up. That was announced — Japan. So right around the world. It’s a healthy product out of British Columbia, and it’s recognized, like you said. So markets are opening up over the years. Even apple products are going overseas.

T. Redies: Is there more that could be done to help orchardists in that regard?

P. Dhaliwal: I think more of the red tape, and support in foreign countries to show that our product is a healthy product. Sometimes, like in the Japan case, it was codling moth in cherries, and there is no codling moth that attacks cherries. So sometimes…. That barrier sometimes stalls things for a long, long time. Science and the agricultural community knows that the codling moth attacks more of the apple products than the cherry. I think more government support, with other government support, and getting those hurdles a little lower.

B. D’Eith (Chair): Great. Well, we’re way over time, but Nicholas, we’ll indulge you.

N. Simons: I was just wondering if that $5 million competitiveness fund…. Is that brand-new? Is it replacing some­thing or renewing something?

G. Lucas: Yeah. It was announced last February, and we’ve been working diligently to get it up and running. It’s imminent that it will be launched. We’ve already done some studies and so on with it to help our industry strategy, to see where we’re going.

Before that, there was nothing specific for a period of time. But we’d just wound up an earlier $2 million fund that was also a companion fund to the replant, to make sure that we were planting the right varieties, and that those varieties succeeded in the marketplace. So that fund was available. It ran out of funding about three or four years ago. We had a bit of a gap, but we’re back on track.

B. D’Eith (Chair): Great. Thank you very much for your presentation. We really appreciate it.

Next up we have Beaton Arm Crossing Association — Sandi Frerichs and Earl Frerichs.

How are you?

E. Frerichs: Fine.

B. D’Eith (Chair): This is a guide. What we try to do is…. If you could try to keep your initial comments to five minutes, then that gives us five minutes for questions at the end.

BEATON ARM CROSSING ASSOCIATION

E. Frerichs: We’ll do the best we can. I’ll open my remarks. In April 2004, the Minister of Transportation commissioned a study of possible crossings of the Upper Arrow Lakes. The ND LEA report, with Buckland and Taylor as consulting engineers, was published on April 28, 2004. Of the three options studied, the causeway and bridge option was the preferred option. It was indicated in the ND LEA report that if the ferry remained in place, growth in the region would be less than 1 percent over the next 25 years.

[10:00 a.m.]

Since this report, several other reports and studies have occurred. They are as follows: the InterVISTAS report; Victor Cumming, economic consultant, assisted in the deliberations of the Nakusp economic summit; and the Beaton Arm Crossing Association completed a multiple accounts evaluation looking at the best crossing options of the Arrow Lakes.

In the fall of 2012, the Ministry of Transport surveyed a full-blown intersection and lake access at the very location that Buckland and Taylor had said their causeway would come ashore on the west side of the lake. By 2014, the Ministry of Transport had Urban Systems do an estimate of the back as option 8 from the multiple accounts evaluation. The cost would be $462.658 million.

This brings us to the study that was commissioned by the Columbia Basin Trust, completed by Davies Transportation Consulting, Wave Point Consulting and S5 Services and titled Columbia Basin Trust Regional Shipping and Logistics Analysis: Final Report. I will refer to this as the transportation and logistics report. An excerpt from the chart on page 12 of this report shows the 2006-to-2016 population growth at less than 1 percent.

Here are two quotes from the transportation and logistics report, on page 4: “Our analysis also suggests that the transport and logistics system does not unduly restrict businesses’ ability to scale their operations and growth. However, businesses with low value and/or heavy products are likely to face challenges in competitively accessing distant markets. For micro-entrepreneurs, it may mean that selling their products beyond the region will not yield a sufficient financial return to overcome the shipping and transportation costs. These businesses may have to diversify their product line and focus on local markets.”

From page 32: “It does not matter to the guest that they have travelled to somewhat remote, less densely populated areas. E-commerce and changing customer demographics are driving expectations for a transport and logistics system than can deliver goods in a cost-effective and timely manner.” A one-way trip from Burnaby to the West Kootenay region will run three to five days for three out of five firms contacted.

Since 2004, we have had four occasions where we have been informed, either in report form or directly, that without a change to our transportation system, we will not have economic development. The time has come to take action to correct this.

Now for a look at the current ferry operations. The CO₂ emissions are 5.9 tonnes per day from the ferry. Since the average car emits six tonnes per year, removing the ferry would be equivalent to 359 cars per year off the road, and over 40 years, the lifetime of the ferry, 14,357 cars off the road.

As part of the British Columbia action charter, item 4 states: “The parties share common goals of encouraging infrastructure and a built environment that supports the economic and social needs of the community while minimizing the environmental impact.”

BACA would like to propose a new option at this time — option 9. This would follow the route proposed by Buckland and Taylor but would be a causeway-tunnel combination. By doing this new option, we reduce the total distance by 6.8 kilometres from option 8 and reduce the cost from the 2014 estimate by $120 million. The total amount of the new road to be built is ten kilometres, with a total cost of all construction of $341 million.

Since the federal government will normally provide 40 percent funding, that would equal $136 million. The balance for the province would be $205 million. Perhaps we could use the carbon tax to pay for this. With your support, we can see this project as a reality and bring prosperity to the West Kootenay region.

The other attachments that I have on the back of the handout that I have are supporting documents for my report.

[10:05 a.m.]

B. D’Eith (Chair): Well, thank you very much for your presentation. You’ve obviously put a lot of work into this. So thank you very much.

Do we have any questions?

I have a question for you. As far as progress with the ministry on this, where does all this sit in terms of dialogue and studies and things like that?

E. Frerichs: The studies that have happened over the years have been surrounded…. The InterVISTAS report was an economic report essentially showing the benefits that would come from building the fixed link — not only in the construction costs, etc., but also in the economic stuff that would come from that. There are other studies that have happened that the Beaton Arm Crossing Association has done. The infrastructure one that was just done by Columbia Basin Trust was a key indicator that there was some need for something to happen.

S. Frerichs: His question was related to the Ministry of Transport and what has been done with them.

E. Frerichs: What they have done?

S. Frerichs: What you’ve done with them.

E. Frerichs: Well, our meetings with them have been to discuss the cost analysis. We had a couple of meetings on the cost analysis of it. We have some disagreement on some of the issues that they had put in there.

It’s an awesome study that they did — Urban Systems. It was in minute detail. But there are some things that we thought were excessive. I guess we fail to agree. But that being aside….

Their position on it is that this is not a project that’s not doable. It is a doable project. It’s just that they didn’t see it as being that critical at the moment. But the ferry does cause a lot of costs for the operations. So based on that, we have minimal development happening in the region.

N. Simons: Thank you very much. What is the ridership on the ferry now per year?

E. Frerichs: It would be in excess of 200,000. I have that here.

N. Simons: So there must be good revenue from that ferry, eh?

S. Frerichs: No. It’s free, which you probably are aware of.

Interjections.

S. Frerichs: That’s part of the problem. Because it’s so far to transport, we’re not getting any growth. We’re not getting young families coming in. We’re becoming a community of retirees because the services aren’t there.

We know that if we have a car and our car breaks down, we’re going to have to wait a few days for the parts to come in. But if you’ve got a tourist coming in and their car breaks down, they don’t understand why they should have to wait three or four days for parts to come in. You’ve lived that.

E. Frerichs: The passengers in 2016, 338,638. This is the latest one I have. The number of vehicles coming over the ferry, 204,823.

Now, the problem that you have there is that you have 14,587 missed trips. A missed trip is when you come to the ferry and you can’t get on. Okay, there’s a missed trip. The change from 2015 to 2016 was about a 27 percent increase in missed trips. Now, I don’t have…. I got this from the Ministry of Transport. This is the latest data that I have. But what we have, and I have asked them for information about this….

[10:10 a.m.]

I wanted the missed trips per month per year, and they wouldn’t provide that to me because it’s a big secret, I guess. But the problem is that in the summer…. The ferry is overkill in the winter, but in the summer it’s grossly inadequate.

N. Simons: My follow-up question is: would tourists be interested in driving across a bridge, or do they come there for the ferry?

E. Frerichs: No, I think they come there for the location. But that’s a problem, you see. When they come there and they have to wait in line, they don’t come back. That’s where the issue gets to be, especially on long weekends. If you’re trying to leave there, you can have a four-hour wait to get on the ferry and get out of there.

B. D’Eith (Chair): Great. Well, we’re out of time. Thank you very much for your presentation. We really appreciate it.

We’re just going to take a short two-minute recess.

The committee recessed from 10:11 a.m. to 10:21 a.m.

[B. D’Eith in the chair.]

B. D’Eith (Chair): Okay. We’re back with the Select Standing Committee on Finance and Government Services. Next up we have school district No. 8, Kootenay Lake — Lenora Trenaman.

Hello, Lenora. If you can see that, that’s just a little guide. What we try to do is if we could have five minutes for the presentation, then it allows us five minutes for questions.

SCHOOL DISTRICT 8, KOOTENAY LAKE

L. Trenaman: That’s awesome. I should get one of those for our meetings.

Good morning. I’d like to apologize for being solo here, on behalf of the district. Our superintendent, our secretary-treasurer–chief financial officer and the chair of our finance and operations committee had wanted to be here. Unfortunately, we did not have enough of a heads-up to be able to schedule our time here. That’s why it’s just me. I’d also like to apologize…. Normally, I would come into a meeting like this being exceptionally prepared. I would have a meeting with my staff, and we would get really organized. Again, we were stretched for time and didn’t have that opportunity.

I would just like to start with telling you that in school district 8, our mission is to focus on excellence in learning for all our learners in the district. “Focus, learn, excel” are our key words. Our goals are learning — literacy, numeracy, inclusion and Indigenization; organizational excellence, which includes our strategic plan, our facilities plan and our financial plan; and we have a technology plan.

We have a goal of relationships, which includes resilience, mental wellness, and nurturing students, staff and families to excel. We have a goal of engagement, students first: students, staff, community participation and leadership — local, provincial and global. Our student expectations are for academic success, creativity and imagination, citizenship and resilience.

To give you a little idea of who we are and where we are, we serve about 5,400 students in our district. We have 23 bricks-and-mortar schools operating in six communities and many regional districts. We have schools configured with kindergarten through grade 12, K through 10, K through 5, K through 6, K through 7, K through 6 to 8, 7 to 12, and 9 to 12. We have two distributed learning programs on five sites.

Our geographical area footprint is huge. I was explain­ing to this gentleman that our district is from the east side of Yahk all the way through and around Creston south rural up to Riondel. It crosses the lake, and it goes to the very northern end of the lake, where we have a tiny little school at Meadow Creek, Jewett Elementary. It comes down along the north shore of Kootenay Lake through Nelson and up to Slocan city. It takes 3½ hours to cross our district from one spot to the other.

[10:25 a.m.]

We have a time change for half the year within our district, we have a mountain pass, and we have a ferry. Those long distances and those roads make it very difficult for us in our operations and for our students to travel. Because of our remoteness, we have difficulties in recruitment and retention, although these challenges are experienced by other districts in the province. It’s very difficult, when you’re a rural remote district, for the program delivery to provide equitable education for all our students.

I brought with me today our strategic plan. We’ve been working on this for about four or five years. Our district is quite unique in its inclusion. We collaborate, we’re inclusive, and we’re transparent. We believe that, fundamentally, everything we do for public education for our students will affect our future.

I’m coming at this at this level, as opposed to coming at you with all the financial difficulties and challenges that we have, because I’m hoping that you will listen from your seat, when you’re contemplating finances, as to how important education is to the future of this province. In everything that happens in this province, those that we educate are going to be our tomorrow. They’re going to be the ones that are operating our health care system. They’re going to be the ones that are operating every system of the province and in our governments and so on. It’s important for us all to understand that.

As a mother, I have a daughter who is now 25 years old and is a teacher. When she started school, it was probably one of the most challenging things that a parent could go through. I didn’t know who she’d be with for 75 percent of her day, so I got involved with her school. A lot of parents don’t have that opportunity. We need to be able to engage and keep people’s hearts invested in education. My experience grew from being interested in her to being interested in other children in her classroom, to the school, to the district and then to the provincial level, because I became very aware of how much impact these kids are going to have on all the things that I’ve been talking about.

The world is changing at an exponential rate. The top ten in-demands in 2010 didn’t even exist in 2004. We are currently preparing students for jobs that don’t even exist yet, using technologies that haven’t been invented yet, in order to solve problems that we don’t even know are problems yet.

The world is growing and shrinking at the same time. It took seven million years to reach a population of seven billion, but by 2050, the population will grow to nine billion, and technology is shrinking the globe. About two-thirds of the population is now connected by mobile devices. By 2020, almost 75 percent, or three-quarters, of the world’s population will be connected. As I say this to you, this provides an intriguing challenge for school boards to use their budgets to be able to adapt, accommodate and educate for those changes ahead.

In our district, we are trying to be able to adequately provide for technology. We have challenges of transportation. Just as importantly, we do not have the infrastructure. We have an aging infrastructure. We have capital challenges. That means that sometimes, regrettably, we have to take out of our operating in order to accommodate for the needs of our capital and our facilities.

I’m sure that you’ve heard this many times, but I would implore you, in your decision-making as you move ahead, that you realize that every system that B.C. needs, utilizes and operates under or with is based on the citizens that we educate.

B. D’Eith (Chair): You’re at about eight minutes now, so a few minutes over in terms of the initial…. If you could wrap up, that’d be wonderful.

L. Trenaman: All right. Having said all of this, I would just like to ask you to think about how you can up the support that you give, financially, to education, especially the rural education in this province.

[10:30 a.m.]

Rural, we believe, is the backbone of B.C. We want to be able to be strong in order to support the entire province. That has to be through education.

I brought you all our strategic plan. Inside you will find a card, and it’s got the highlights from this year.

B. D’Eith (Chair): Great. Thank you very much.

Quick question. You mentioned recruitment and retention. What do you think would be the biggest challenges for that, and from a financial point of view, what sorts of things could the government do to help with that?

L. Trenaman: If the government were to consider providing a budget, which would be to help…. First of all, you’d have to make sure that our teachers or our potential teachers are able to attain their goals. So more teachers, more education for the teachers.

More importantly, we could use grant funding to support the outreach schools. In our little Jewett, we need to have somebody there. In our Crawford Bay…. Crawford Bay has about 77 students from kindergarten through grade 12. It’s very difficult for that school to resource. They have class­rooms that are multi-age and multigrade.

We need to be able to give an incentive, a bonus of some sort, to have them want to move there and live there and be there, as opposed to travel there. That would be one way.

Even for our principals in the outreach…. People travel, right? If everybody is coming towards the nucleus of the centre that they shop in and recreate in, an incentive to provide those opportunities, whether it’s transportation or facilities or support or whatever. We need to find ways to be able to support, other than what we do with our own funds.

D. Ashton (Deputy Chair): Just real quick. What’s the longest bus ride for your students?

L. Trenaman: Oh, that’s a really good question. I would say one way would be a minimum of 45 minutes.

D. Ashton (Deputy Chair): So less than an hour, then. Okay. Thank you.

B. D’Eith (Chair): Just before we leave…. Thank you very much for your presentation.

Just to reiterate the purpose of the Finance Committee. We’re not treasury. We’re not the Minister of Finance. We’re not the Minister of Education.

L. Trenaman: Yes.

B. D’Eith (Chair): Those decisions in terms of how funding is allocated…. What we do is we listen to people around British Columbia, and we try to give a good flavour to the decision-makers as to what the priorities are. So I appreciate what you’re saying. I just want to make sure that you understand the role of the Finance Committee, in terms of expectations and what we can do in terms of decision-making.

L. Trenaman: May I make a comment to that?

B. D’Eith (Chair): Yes, of course.

L. Trenaman: I fully understand that. We will be making a submission, which will have numbers and further context and be better organized than this. I wanted to reach the hearts of you — to understand how important education is to our kids and our future.

B. D’Eith (Chair): Appreciate that. Thank you so much.

Next up we have Brent Holowaychuk and Tanya Finley from Finley’s Bar and Grill and Sage Tapas and Wine Bar.

Welcome.

FINLEY’S BAR AND GRILL,
SAGE TAPAS AND WINE BAR

B. Holowaychuk: Thank you for this opportunity. A little bit about ourselves. Tanya and I bought a business in Nelson almost 16 years ago. We were at the ripe age of 26 and bought a business with 100 percent debt, almost zero equity, lots of maintenance….

B. D’Eith (Chair): Sounds like a good deal.

T. Finley: Easy on a marriage.

[10:35 a.m.]

B. Holowaychuk: We saw a chance, and through over a decade of hard work and countless sleepless nights and trials and tribulations, we’ve become successful. We’ve become a mainstay in our community.

Myself, entrepreneurialism is in my DNA. My family has been in entrepreneurial business since as far as I’ve been told. I’m a third-generation publican, started on the coast. My family, specifically, has been in the bar business since the mid-’60s.

Through that process, we’ve seen lots of changes in our industry. Not just our society has changed around alcohol and bars and such, but the legislation has changed around it. The liquor industry, in particular…. The liquor-primary industry would be bars, pubs, nightclubs and such. It has seen, over the years, a significant decline as legislation changed that favoured restaurants.

In the last big liquor adjustments, I guess a few years ago, there was actually a shift back that gave some of the liquor-primary businesses a leg up. That number one leg up for us was allowing minors. So for those of you that were part of that process, thank you. It’s given us a chance to really strive and succeed.

There is a concern for us going forward in the form of a margin squeeze. We’re very concerned about the challenges of rising minimum wages. It’s putting a big shift on us to look at how to become more efficient, how to become more productive with our staff. We are looking at moving into some technology to help us with that — tablet formats.

We’re seeing that shift within the entire industry. Certainly, the big chains are going to self-service models. In certain extreme examples, you’re seeing self-service fine dining restaurants in jurisdictions that have tight costs, for lack of a better term.

One of the things for us that we’re seeing that’s holding us from being able to raise our prices to compete or to keep abreast with rising costs — the minimum wage, carbon taxes, employment health taxes, and such — is that within our industry there isn’t a level playing field. For us, one of the key ones is the microbreweries or craft breweries.

I’m not sure when the shift was made. There was some tax or markup changes that allowed microbreweries to have a leg up over wholesale macrobreweries, like the Molson’s and Labatt’s of the world. It was put in for the intent for them to compete in a wholesale environment. As time went on, those breweries were allowed to have a tasting room, and then later they were allowed to open up lounges and pubs of their own. Now that markup advantage is being used to compete in a hospitality environment, where the markup just isn’t the same.

It doesn’t seem like a whole lot. You know, we’re talking a macrobrewery markup is $1.08 per litre; a microbrewery or craft brewery is 55 cents a litre. It works out to about 25 cents a pint in cost that those businesses are able to keep in their pocket that everyone else is paying.

T. Finley: To give you an example of our business, we do about 900 kegs a year, so breaking that down into numbers is huge when you’re looking at profit margins. We are happy that the microbreweries are here, and we are happy to see the microbreweries have lounges, but what we need to see is that the profit margins equal each other and they’re the same.

The liquor industry, in general, has always tried to keep things fair and consistent across the board, and we understand why they opened that door for them, but you forgot to close one of the other doors when you opened two more. So just to go back and revisit the profit margins. We have these papers here.

B. Holowaychuk: I guess one way of comparing it would be with the floor price or the B.C. minimum price for alcohol.

[10:40 a.m.]

In a wholesale range, if a person was to sell two litres of beer like a growler, or almost a six-pack, the provincial minimum price with tax, I believe, is $7.34. Typically, a growler, to fill it at a microbrewery, is about $14, $15, $16. It’s about 100 percent above what the floor minimum is.

With a 50-litre keg, the typical B.C. minimum price, I believe, is $113, or just over $113. Typically, the prices that they’re selling those kegs for are between $178 and $215 — again, ranging from a 50 percent to 90 percent increase above the provincial minimum.

When it comes to selling draft beer by the pint, the minimum price is 25 cents an ounce. The microbreweries or craft brewers that are in our town are selling that draft beer at 25 cents, 26 cents, 27 cents an ounce. That increase isn’t much more than 10 percent above the floor minimum for the province, and it’s making it very hard for us to adjust our prices with inflation, with our costs going up. We’re finding that there’s this continual margin squeeze.

I don’t think that this is, you know, the only challenge that we’re going to have in this environment. They are a manufacturer. They can produce at a cost that is far lower than us. But these savings that they have, and the markup price, in a hospitality environment is making it harder.

Anecdotally, for us, there are other restaurants in town that have had to drop their prices. There’s a sushi restaurant that is right across the street from one of them, and they’re selling their imported Japanese beer for about $2 below what market price would normally be for it — simply because if they don’t, they feel that their customers are going to take the sushi and go across the street and eat it in the brewpub. That’s a small, little, tiny restaurant that, you know, isn’t the scale that we are. But it’s affecting a lot of places.

Now, one of the ways that I’d ask for us to level this playing field…. There are a couple of ways. One way would be to simply increase the markup on their product, for product that’s sold within their establishment in a hospitality sense. It’s trackable, and it would help level the playing field, or it would level the playing field, at least in a tax sense or markup sense.

Another way that would allow us to compete better would be for us to be able to sell growlers. Right now there is zero competition for them, and that’s why they’re able to sell at a premium markup to the floor price. That would allow us to eat into…. If you look at macroeconomics, we would then be eating into their margin on one item, and they would have to raise their margin on something else to make up for that shortfall.

All of that is just simply in the legislation that we have in place. I don’t think this was the intent when all of this went in. It’s just sort of the natural conclusion of unintended consequences.

B. D’Eith (Chair): Brent, we’re at about nine minutes now.

We don’t really have a lot of time for questions, but are there any questions from the floor?

N. Simons: I have a question. I don’t understand. It’s a complicated industry, it’s a complicated legislative framework, and probably some of it dates back to 1800-something.

B. Holowaychuk: Yes, it does.

N. Simons: The changes that were made…. There were a lot of people supporting the liberalization, for lack of a better word.

My question is: does it make it difficult for small restaurants to serve the small breweries’, craft breweries’, product in their restaurants? Is there a price issue there as well?

B. Holowaychuk: There is.

T. Finley: We carry all their products. We carry Torchlight, NBC and Backroads. We carry them all on tap, basically because if you don’t, you’re not supporting local business. It’s detrimental to your business to not carry them, we felt, which is why we chose them. The problem is what they’re serving it for and what we’re serving it for — our difference in price, because our markups are much larger. So you’re taking a cost hit by carrying their product.

B. D’Eith (Chair): I think we heard from some microbreweries that had some issues on the other side too.

[10:45 a.m.]

This is something that, obviously, the branch…. They’re going to have to look at this in detail to make sure.

T. Finley: I can give you an example, too, just a quick one. When the liquor stores…. If you had a liquor store, and you had a pub, you got a price differentiation when you purchased for your liquor store, but it was different for the pub. It’s looking at those things where people used to go and purchase from their liquor store and move it over to their pub. It’s a mistake that just needs to be relooked at.

N. Simons: I appreciate that.

The other thing is: are lounges or tasting rooms serving food as well? Is that something that they’re getting into more and more, and is that probably encroaching?

B. Holowaychuk: Some are. Some choose not to. Some choose to just have the basic beer sticks and pretzels and the like. I’m not that concerned about the food part of it. That part is competitive, I guess. It’s an even playing field. The bigger issue, I think, is there’s a…. I keep wanting to use the word tax incentive, but it’s a markup, is what it’s called.

B. D’Eith (Chair): We’re out of time, but thank you very much for coming in. We really appreciate it.

A motion to adjourn.

Motion approved.

The committee adjourned at 10:46 a.m.