Orders of the Day

Hon. M. Farnworth: In this chamber, I called continued estimates debate on the Ministry of Energy, Mines and Petroleum Resources. In Committee A, I call Advanced Education, Skills and Training estimates.

[2:35 p.m.]

Committee of Supply

ESTIMATES: MINISTRY OF ENERGY,
MINES AND PETROLEUM RESOURCES

(continued)

The House in Committee of Supply (Section B); L. Reid in the chair.

The committee met at 2:37 p.m.

On Vote 21: ministry operations, $95,006,000 (continued).

J. Rustad: Unfortunately, I was unable to be here the other day when you were doing the estimates on Hydro. However, I have a number of questions that I need to ask, and hopefully, the minister will be in a position to be able to provide some answers.

In particular, there is a number of forest companies around the province that are currently utilizing wood waste for producing power. So the first question I’d like to ask the minister is: does the minister believe or think that power production from wood waste is something that fits into the future portfolio for the province and for B.C. Hydro?

Hon. M. Mungall: The short answer would be yes. In fact, biofuels — and wood waste products, particularly — play a very important role in our overall hydro-generating capacity. Right now, we don’t have B.C. Hydro staff with us, but the ADM responsible for Energy is just out there looking at me to come in. So I’m going to sit down, get him in here, and then we can give you a fulsome answer.

[2:40 p.m.]

I imagine that the member opposite is going to have a few questions around this, so I’ll keep this answer very brief, which is, of course, the answer remains yes and that wood waste and biomass plays a significant role in all of our independent power project portfolio, and that includes pulp mills and stand-alone as well.

J. Rustad: As you know, of course, there are a number of these projects that are around the province. Does the minister see adding new potential power opportunities utilizing wood waste to the mix in the future?

Hon. M. Mungall: To the best of our knowledge, there is no new wood waste under active consideration right now, and there has been no power call for that particular power generation. There has been no approach to B.C. Hydro, as well, in our understanding right now.

J. Rustad: I just want to be clear. So there hasn’t been any approach at the moment. Is the minister contemplating, actually, doing a future call? I get that could be into a future budget, so I can ask that question again in a future budget.

I’m just curious around this, because there are a number of components and commitments that government is making around wood and wood waste. Obviously, generation of power is a significant potential component of that. I’m just curious about whether those opportunities will be there or whether that’s being contemplated, going forward.

Hon. M. Mungall: We’re not contemplating any power call at this time. Should that change, absolutely, we would be anticipating biomass to put bids into that call.

J. Rustad: I guess I need to ask the question as well. Obviously, there are a number of projects that have been in place in British Columbia for quite a few years. Does the minister anticipate a reduction in any of the current capacity that we have for power that’s being generated out of wood waste?

[2:45 p.m.]

Hon. M. Mungall: As the member may know, there is actually a number of contracts that are around biomass generation. They’re coming up for renewal, and B.C. Hydro will be considering those renewals. This government is not directing any type of reduction whatsoever. As B.C. Hydro considers those renewals, our government is supportive of them moving forward in a way that, of course, works in the best interests of ratepayers.

J. Rustad: Yes, there are a number of contracts that are coming up for renewal. Over time, of course, they will all come up for renewal. The challenge, I think, that many of the forest companies are having today, given that we wanted to get rid of beehive burners and get rid of the burning of waste and be able to utilize that waste for other products….

We encouraged companies to find those solutions. Power production, of course, was a big part of that — pellet production as well. Pellet production falls outside of the minister’s purview, obviously, but power is a key component of being able to utilize that wood fibre.

Current negotiations with B.C. Hydro are such that it may make it impossible for these contracts to be renewed because of the price points. Is the minister aware of these negotiations, the price point pressures that are being put on these companies?

Hon. M. Mungall: I appreciate what the member opposite is saying. That being said, ultimately these are commercial negotiations. B.C. Hydro has to make sure that any time they enter into negotiations, one of the main things they’re considering is ensuring that they get the best rate — the best price point, as the member said — for ratepayers.

J. Rustad: Thanks, Minister, for that answer. I’m in agreement that as a government, whether you’re opposition or government side, we should be trying to get the best rates we can, obviously, on these.

The challenge, of course, is that government is proposing a carbon tax on the burning of wood waste, particularly slash. Without these power projects being able to continue in some fashion or another, companies are going to be forced to have to eliminate the waste product through burning of that product without producing power. There’s only so much, in terms of the price point, that’s within there. The negotiations that are going on with B.C. Hydro are focused, to my understanding, solely around price point, where there are other conditions that need to be taken into consideration.

[2:50 p.m.]

Would the minister consider engaging with the companies and with B.C. Hydro to consider all factors that led to the ultimate decisions to build these plants and what needs to be done to be able to make sure that we can utilize the waste fibre for something like power production, as opposed to going back to having to burn it either in the woods or through beehive burners?

Hon. M. Mungall: I know that the member knows that these types of negotiations are never easy. They’re always difficult, because there are a variety of factors to consider. The big one will always be the rates and what goes back to the ratepayers. B.C. Hydro has to do that — that primary duty of making sure that they are operating in a function that is keeping rates as low as possible.

They can’t just — ideally, they wouldn’t — wave any price point and say: “Sure, that’s what we’ll do. It’s not good for ratepayers.” I mean, I know the member knows that they have to work in the best interests of ratepayers, and I’m sure he would anticipate that and want that himself.

His question is about if the ministry is at all engaged in any of this. Actually, it is. The ministry has already been engaging with industry and with Forest, Lands and Natural Resource Operations and Rural Development to ensure that we are identifying best ways to use wood waste, including electrical generation.

J. Rustad: I appreciate that obviously there are conditions that need to be looked at in terms of how to renegotiate these agreements. But when you look at the cost of moving fibre — carbon tax included in the cost of moving that fibre, the cost of labour and other components — the simple generation of power and the cost of producing the product at a plant do not take into consideration those transportation costs and the other factors that are required to be done in order to be able to make an operation viable.

This is where I’m suggesting to the minister that there needs to be another lens put on it outside of the mandate that B.C. Hydro has, because B.C. Hydro cannot, to the best of my knowledge, take those other factors into consideration.

The question to the minister is: is there an avenue for the minister and the ministry to engage in this process, to be able to factor those other components into the cost of power production so that we can get agreements renewed and see the continual use of this waste fibre being put towards power generation?

Hon. M. Mungall: First, I want to start by saying that I absolutely am always going to be working in the best interests of ratepayers and wanting to make sure that we keep rates as low as we possibly can. That being said, I hear what the member is saying, so I’m going to take the time to look into it and maybe have a meeting with him directly to talk more.

J. Rustad: I appreciate that offer, and we’ll schedule something down the road, I’m sure, when we have an opportunity.

[2:55 p.m.]

Moving on to part of that — because a big piece of this is how we dispose of the wood waste — it was one of the solutions. Obviously, doing pellets — there are other types of products they produce. But power was one of the solutions to help the mills move away from beehive burners. It’s a critical component. It’s a direction, obviously, that the previous government gave to the industry to try to remove the beehive burners and the need for burning of those wastes.

Along those lines, the current government is now proposing a carbon tax on slash burning on the wood waste that’s left behind. I’m assuming that could potentially expand to any kind of wood waste, I suppose, that is left behind.

Given that one of the viable options, and one of the most viable options, for utilizing of that fibre is to be able to generate power, is the ministry engaged with the Minister of Environment with regards to the carbon tax components of what that will mean and the potential of that waste being an energy source for our electrical needs going forward?

Hon. M. Mungall: Ultimately, the two ministries that are primarily the leads on this very issue are actually the Ministry of Forests and the Ministry of Finance. That being said, to answer the member’s question, my ministry is engaged because we are looking at the possibility for electrical generation.

J. Rustad: In estimates for the Minister of Forests and the Minister of Finance, they pointed me to the Minister of Environment. But that’s okay.

It’s an important component of what needs to be thought about. In particular, what I’m looking at is that because of the cost factor and Hydro trying to get to the lowest rates in terms of power production, there may be an opportunity to be considered, an offset through a credit or some other value system that could be set up through a tax on, say, wood waste.

Now, if you look across the forest industry broadly, the amount of wood that’s being wasted, that’s being burnt at $50 a tonne would equate to about a half a billion dollar hit to the forest industry. So anything that could be done, obviously, to recoup those costs….

Now, I’m assuming that’s going to go straight $50 a tonne. I haven’t heard direction yet from government, and I know government’s going and looking at these things. But if there is anything that could be done to reduce those costs by having some sort of offset that would allow that waste to go into power, it might be able to achieve what B.C. Hydro is trying to do as well, which is get the rates.

The question to the minister is: is the ministry looking at these kinds of options and considering bringing forward these types of solutions? So for projects that are already built that are needing to be renewed and have been struggling trying to get those price points, or for future projects that may be proposed to try to utilize some of that waste — whether or not she or the ministry would be advocating, for a solution to help brings those cost lines in place to what B.C. Hydro is trying to achieve.

[3:00 p.m.]

Hon. M. Mungall: The ministry is looking at a range of options. Across ministries, as well, government is looking at a range of options to manage wood waste, and absolutely, power generation stays and continues to stay on the table as one of those options.

J. Rustad: I’ll just wrap up. One more comment around this. I know, from my questioning of the other ministers around the carbon tax component, that government has taken some time to look at this. It could be one, two or three; who knows how many years out in terms of how the process goes. It may happen quicker than not.

We have a challenge because we’ve got agreements that are up here in the next few months that need to be renewed. It puts at risk operations. For mills that do not have an alternative to be able to get rid of the waste…. It actually puts those mills in jeopardy in terms of having to close down. If they can’t burn the waste and they can’t use the waste for power, what do they do with it? Where does it go? There aren’t alternatives.

During this period of time, I would encourage the minister to engage with the companies and B.C. Hydro around trying to find a solution so that we don’t end up seeing situations where mills may have to curtail operations simply because we haven’t been able to find a solution in terms of the waste and been able to come to an agreement for that. As the minister knows, forestry is the backbone of many communities, including some communities, I’m sure, in her area. The need to be able to resolve this in a timely way is critical.

I think I’ve made my point. I look forward to the opportunity to meet with the minister and to try to work this thing through so that we can make sure we create as much certainty as we can and overcome this uncertainty that’s being created right now with these negotiations that are going on between companies and B.C. Hydro.

Hon. M. Mungall: I was wondering if anybody was going to get up and ask a question. I didn’t hear a question in there. But I just want to comment. I do look forward to working with the member opposite on this very issue. I know that this is near and dear to him because it is something that’s impacting his very backyard.

As I said earlier, I hear his points about looking at the big picture, not just the price point. I hear that, and I look forward to working with him on this issue.

T. Redies: Minister, today you made the announcement that you’ll be freezing B.C. Hydro rates for a period of one year starting April 1, 2018. That was a little surprising because yesterday you’d talked about doing a review and trying to find cost savings.

I’m just curious. Now that you’re forcing B.C. Hydro into this $150 million hole, how is this going to be made up? Are additional capital projects going to be cancelled?

Hon. M. Mungall: We canvassed this issue quite extensively yesterday with B.C. Hydro staff. The announcement made today was actually exactly what I said we would be doing yesterday. So there’s absolutely nothing different from any of our conversation, any of the questions that the member opposite asked. All the answers would still stay the same.

At the end of the day, I asked if B.C. Hydro staff could go home to Vancouver or if they were required to stay to answer any further questions. I was told that there wouldn’t be any more B.C. Hydro questions. So I don’t have the appropriate people to go deeper, if the member is wanting to do that. I’m happy to take any questions in writing and make sure that I get back to her in a timely manner.

That being said, it’s her time. If she wants to ask questions, she can, but I’ll let her know now that my answers from yesterday would be the exact same today.

T. Redies: Thank you, Minister, for your answer. I’m just very surprised that you have made an announcement. That’s why we’re back today. You’ve made an announcement. Rather, the minister has made an announcement. Pardon me. The minister has made an announcement that is going to affect the company by $150 million.

[3:05 p.m.]

Would there have been no discussions with B.C. Hydro in terms of how this would be made up? I mean, you wouldn’t just make a decision about $150 million without having some idea of how this was going to be made up. Surely, the minister must know something.

Hon. M. Mungall: As I was saying yesterday, the rate freeze has always been tied to a review of B.C. Hydro. Also, as I said yesterday, the rate freeze will be starting in April 2018. If it goes forward…. We hope that it does. The BCUC, ultimately, is going to be looking at this.

What has happened is that we have collaboratively worked with B.C. Hydro. B.C. Hydro is changing its revenue requirements application from the 3 percent rate increase it had in that RRA for April 2018 to zero percent. They’ve amended their RRA that is currently before the B.C. Utilities Commission.

The B.C. Utilities Commission will then do the due diligence that is required and determine whether a zero rate increase is acceptable. Should it be acceptable, then we will move forward with that rate freeze and conduct a review of B.C. Hydro over the course of that year. Because the rate freeze doesn’t come into effect until April 2018, it actually gives us time, by the time all the accounting is done in that year of review, to look at ways where we can mitigate any impacts of the freeze.

T. Redies: I’m now very confused. The minister and her government just announced today a rate freeze. But I think, based on her answer, she’s saying it may or may not happen because the BCUC might decide it’s not appropriate. Is that correct? Is there a rate freeze or isn’t there?

Hon. M. Mungall: There is going to be an application for a rate freeze before the B.C. Utilities Commission.

T. Redies: If it wasn’t a done deal, why would the minister and her government go out with a public release today telling the public that there is going to be a rate freeze starting April 1, 2018? That makes no sense.

[3:10 p.m.]

Hon. M. Mungall: I’m sorry if the member opposite didn’t feel that I was clear yesterday. I felt that I was. I thought that I was very clear that we would always be going forward to the B.C. Utilities Commission in this very fashion. That was part of the news release that we put out, and it’s what I said to reporters just an hour and a half ago. Members opposite, I do believe, had staff people recording that, so they can go back and see that. But that has always been the process that we talked about — yesterday as well as today.

T. Redies: I know what the process is, Minister. I know what the process is. I’m just confused as to why the minister would go out with a public press release announcing this rate freeze, when she didn’t know whether or not it was going to actually happen. Isn’t that a bit misleading for the public?

Hon. M. Mungall: As I said to the member opposite, the process was clear. It is in the news release. I was clear with all of the media about the process — that we’re bringing it to the B.C. Utilities Commission for review.

A. Weaver: With respect to the minister, I’d like to read the formal government press release. It says this:

“The British Columbia government is delivering on its promise to freeze B.C. Hydro rates, putting an end to years of spiralling electricity costs that have made life less affordable for B.C. homeowners and renters, Minister of Energy, Mines and Petroleum Resources announced today.

“B.C. Hydro rates have gone up by more than 24 percent in the last four years, and by more than 70 percent since 2001. The minister says that in 2016, B.C. Hydro applied to the B.C. Utilities Commission for three years of increases, with a 3 percent increase planned next year, but will be pulling back its request, consistent with this administration’s commitment to a rate freeze.

“‘After years of escalating electricity costs, British Columbians deserve a break on their bills,’ said the minister. ‘From the moment we took office, we’ve taken action to make life more affordable. As part of that, we’re going to make sure that B.C. Hydro is working for the benefit of British Columbians and that its rates reflect that commitment.’

“The rate freeze will provide government the time to undertake a comprehensive review of B.C. Hydro. That review will identify changes and cost savings to keep rates low while ensuring B.C. Hydro has the resources it needs to continue to provide clean, safe and reliable electricity. Details of the scope and process for the review will be developed once government has made a final decision.

“After completing a comprehensive review of B.C. Hydro, any cost and revenue adjustments identified will be reflected in the rates starting in April 2019.

“The rate freeze” — again — “follows government’s commitment in its September budget update to phase out the provincial sales tax on electricity.”

It says nothing about approaching BCUC. It’s very clear, and I concur with the member opposite. I feel that this is quite misleading. I would like the minister to please clarify why the press release says, on the one hand, there’s a rate freeze, and now here today we understand that there’s not really a rate freeze but an application for a rate freeze.

Hon. M. Mungall: He read the press release in full, and he also read directly from the paragraph that talks about B.C. Hydro going to the B.C. Utilities Commission and exactly how the full process is taking place, how it’s tied to a review.

[3:15 p.m.]

I am sorry that he finds it misleading. I personally am curious as to how he does. I mean, it seemed to be really clear to me.

T. Redies: Now that the minister has gone out with this press release, what does she plan to tell British Columbians if BCUC comes back and says: “No, you can’t have a zero percent rate increase”?

Hon. M. Mungall: That’s a fair question, absolutely, and we’ll cross that bridge when we come to it. We have to go through the B.C. Utilities Commission first. We value the input that the BCUC has in our rate-setting process. We value the input that they have overall in managing our public utility from an independent, expert body looking out for the interests of the public. So we feel that the appropriate process, as defined in legislation and regulation, is to go through the B.C. Utilities Commission first and foremost. We will see what their decision is.

T. Redies: We are not quibbling about the process with BCUC. This is a process that B.C. Hydro has undertaken pretty much every year. They have a regular dialogue with BCUC, and if there are going to be rate increases — I guess now zero increases — they have to get BCUC’s permission. What we’re questioning is why the minister would go out with an announcement that signals, I think, to the public very clearly that they are responding to their prompt campaign promise and they are delivering on a rate freeze when she doesn’t have any degree of certainty that she’ll actually be able to deliver on that.

Hon. M. Mungall: I think that it’s appropriate to bring the public along with government as we take action on a number of items. I think that it’s appropriate to let the public know that we’re taking action on this item that was very important to them.

It was clear on the doorsteps I knocked on and, I’m sure, on the doorsteps the member opposite knocked on — and on any doorsteps in this province — that people are concerned about affordability. Every dollar counts when we’re dealing with an affordability crisis. So we committed to freezing hydro rates as part of our larger package in dealing with affordability. I think it’s appropriate to then tell the public what we’re doing to meet that commitment and be upfront about it, and that’s what we’re doing.

M. Bernier: Just trying to understand and clarify this, then. The minister made an announcement earlier, saying that they’re saving $150 million of taxpayers’ money through the rate freeze. She’s also on record saying that she respects the autonomy of the Utilities Commission. But by this announcement, she’s also admitting, it sounds like, that she’s prejudging the outcome now of that same group of which she says she respects their autonomy.

Can the minister explain to not only this House but to the people in British Columbia, because now we’re really confused: are they saving $150 million right now? Or are they, as she says, just putting the application forward and having to wait now to see what the Utilities Commission is actually going to say and whether they’ll approve that application?

[3:20 p.m.]

Hon. M. Mungall: I just want to be very clear, for the record, that I’m not prejudging, and nobody in this government is prejudging, the outcome at the B.C. Utilities Commission. What we are doing is the appropriate process, and we are being upfront and honest with the public. I think that is the right thing to do. I think we all in this government think it’s the right thing to do, so that is what we’re doing.

M. Bernier: Can the minister, then, clear the air in the sense of letting the public know and letting this House know: was it an accurate comment for her to make to say that the taxpayers are now saving $150 million? Or was it more of a fair comment to say they’re waiting to see if the Utilities Commission approves their application? At which point, if approved, they might be saving money.

Hon. M. Mungall: Just to clarify. I’m sure the member meant this, but just in case, and for the people who might be watching at home, the savings of $150 million would be felt by ratepayers, not taxpayers. I’m sure the member knows that difference, but I just want to clarify for anybody who might be watching.

Again, I think what is important to note here and what I’ll be sharing — and it sounds like it might be over and over again — is that we made a commitment during the election to make life more affordable for British Columbians. We are living up to that commitment.

One of the ways that we said we would do that is to freeze hydro rates. There is a process to go through to get to that place. We’re following that process, and we’re being upfront and honest with the public about what that process is. We intend to live up to our commitment, absolutely, but we’re going to follow the process to do that.

M. Bernier: I’m well aware of the process. I managed a utility company — was part of that for 22 years. I worked with the Utilities Commission through rate applications for that entire time, so I’m well aware of it. Every single time, we were always told that we had to wait, because sometimes on a Utilities Commission application, there are opportunities for intervenors, opportunities for discussion, opportunities on a wide gamut of things.

You could never prejudge what the Utilities Commission would say. It’s an independent body that’s actually directed to be independent, to look out for the ratepayers of British Columbia, as we canvassed yesterday and as the minister was quite open on when we talked about Site C and the role of the Utilities Commission then.

Again, I’m just trying to understand, because the minister is publicly saying that the taxpayers, to make life more affordable, are going to be saving $150 million, but I have yet to hear the commitment. Is she actually directing the Utilities Commission to accept this application? Is the Utilities Commission being told, then, by government that they have to actually put this rate freeze in and accept that?

[3:25 p.m.]

Hon. M. Mungall: As I’ve said earlier, there’s been no direction to the B.C. Utilities Commission. Should they disagree with the rate freeze, we’ll deal with that when the time comes.

M. Bernier: Is the minister willing to retract her press release and the comments, then? Her government has come out and announced that the taxpayers of B.C. are saving $150 million. I think it’s fair now to say, from the line of questioning here and the answers, that they’re actually not. It’s still a maybe.

I know her government has made promises. I know her government and the ministry have made commitments. I’m not trying to take away from that. What I’m trying to ascertain is whether those commitments are actually still a pie in the sky. Are they happening? Are we waiting for reviews? Or is she actually telling BCUC what to do?

It sounds like the minister is not directing the Utilities Commission to accept this application. So in essence, is the minister willing to retract the press release and say that in essence, again, the people of British Columbia aren’t necessarily going to be saving $150 million yet?

Hon. M. Mungall: We’re going to have to agree to disagree here. I feel very, very solidly that our press release, everything I’ve said to media and everything I’ve said in this House has been consistent. There is no inconsistency, from my perspective. I feel that we’ve been upfront. We’re being transparent. The members opposite may disagree. I’m not really surprised by that. I mean, they’re the opposition, and that’s their job. But we’re going to have to agree to disagree here.

A. Weaver: Before I ask the questions, I’d like to seek leave to make a brief introduction.

Leave granted.

Introductions by Members

A. Weaver: I’d like welcome a group from Vancouver Montessori School here who are accompanied by their teacher, I understand, Mr. Michael Lee, from Vancouver. I just saw them come in the audience, and I thought we’d introduce them and give them a little idea that what we’re debating here is actually budget estimates for the Ministry of Energy, Mines and Petroleum Resources. The Liberal members opposite, with the Green Party members, are debating with government on this particular topic. With that, I welcome you, and I’m sure the rest of my colleagues here would welcome you as well.

Debate Continued

A. Weaver: I’m really troubled by the line of questioning here, and I’m really troubled by what’s being revealed. I have read that press release carefully. It is very clear from that press release that the government is telling British Columbians that they are going to freeze hydro rates by April 2018. That’s the only message that you can take from this press release. It’s the only message that we took from our no-surprises, good-faith confidence and supply agreement discussions about this issue here.

This is a surprise that we are not actually freezing rates, but we’re going to the BCUC to ask them whether they will give us permission to freeze rates. We’re not going to influence them, on the one hand, because we respect the independence of the BCUC, but on the other hand, we’re saying that we’re saving $150 million. You can’t have it both ways.

So I would like to reiterate the concerns expressed by the member for Surrey–White Rock and the member for Peace River South and suggest, in emphatic terms, that I believe the minister owes British Columbians a formal correction in a press release. I will ask: will she be willing to do that in response to the line of questioning that we have seen here today?

[3:30 p.m.]

Hon. M. Mungall: I guess, also, the Leader of the Third Party and myself and our government are going to maybe have to agree to disagree in terms of the wording of the press release. I feel it’s very clear. He did read it out. I don’t know what is unclear about that, but I think we’re just going to have to agree to disagree on this.

A. Weaver: The press release should have said this, “B.C. government will seek the ability from BCUC to freeze rates,” not “B.C. government will freeze rates.” But they said, “B.C. government will freeze rates,” and that’s simply not correct. There’s no other interpretation here.

[R. Chouhan in the chair.]

Sometimes it’s okay to admit that you’ve made an error, but it is not okay to double down in defence of something that is clearly wrong. Again, to the minister: will she correct this publicly? It is misleading, and people across British Columbia think that their rates are going to freeze in April 2018, when they’re not. They’re not going to freeze unless the BCUC says they will.

Hon. M. Mungall: We’ve been canvassing this issue for about just over 45 minutes now. I haven’t offered any new information or anything different, and I think we’ve come to the conclusion that this government and members opposite are just going to have to agree to disagree in terms of the wording of a press release.

The Chair: Member, just a caution. We must try to word it better than this when we are asking questions. So if the question has already been canvassed several times and the answer was the same, maybe we should move on.

This is just a caution. I’m not stopping the members from doing it, but that’s a caution from the Chair.

M. Bernier: It is unfortunate. We were expecting to be finished estimates yesterday. I’m now seeing that we might end up even going into tomorrow, because we do expect answers to these questions. And I think the member of the Third Party, the leader of the Green Party, raises a very good point. When a press release goes out from government that says they’re saving $150 million when they truly might not be, all we’re asking the minister to do is stand up and clarify that this is a maybe. That’s all we’re asking her to do.

She will try to say that it’s “agree to disagree.” The press release doesn’t even talk about the fact that they’re going to send this to the Utilities Commission for a review. The press release doesn’t talk about that this might happen. The press release doesn’t even reference the fact that the Utilities Commission has a say in whether they’ll approve this or not. The press release is actually very clear.

They’re trying to make it very clear to the people of British Columbia that $150 million to the taxpayers is going to be saved. That is absolutely false if it’s not approved by the Utilities Commission. So again to the minister, it’s one of two things: either the press release is misleading to the public, or the minister is actually going to be directing the Utilities Commission on what to do. In either case, the public deserves to know what the answer to that is.

Hon. M. Mungall: Hon. Chair, I request a five-minute recess, please.

The Chair: The committee will be in recess for five minutes.

The committee recessed from 3:34 p.m. to 3:48 p.m.

[R. Chouhan in the chair.]

Hon. M. Mungall: I believe that I answered the member’s question on multiple occasions this afternoon.

They’re entitled to their interpretation of whatever this government does. I don’t expect them to agree with this government. I don’t expect them to agree with how we word our press releases. They’re the opposition. It’s their job to provide an alternate perspective. However, that being said, I will keep saying the same thing. We’re going to have to agree to disagree here.

M. Bernier: It’s unfortunate that the minister is taking that position, because I think it’s quite apparent that it looks like she’s misleading the public, when you actually have a situation where a press release goes out and says they’re saving $150 million when it sounds like they truly aren’t.

I guess an easy question, hopefully, if she can give me a yes or no. If I actually go on Twitter right now and I tweet out that government is wrong and that you’re not saving $150 million from the announcement today, is my tweet correct?

[3:50 p.m.]

The Chair: Member, I think the minister has said very clearly that you can agree to disagree. The answer is going to remain the same. So are we going to continue with the same angle over and over again? How long…? Because we can’t have a stalemate here.

M. Bernier: With all due respect, it’s a completely different question. I’m not asking whether she’s going to actually tell the public. I’m asking her: if I tell the public, is that correct?

Hon. M. Mungall: What the member opposite chooses to tweet is entirely his business. This ministry has no opinion on that whatsoever. It’s not a budget item in this ministry. It’s not a program in this ministry. It has just nothing to do with this ministry. How he wants to exercise his freedom of speech, he’s fully entitled to do so.

T. Redies: I’m sure the minister is aware that B.C. Hydro’s fiscal year ends March 31. Why this is important is if the government, the minister, makes the decision to terminate Site C, the $2.1 billion that is sitting on the balance sheet at Hydro becomes an impaired asset and has to be written off, or it has to go to a regulatory account, which has to be approved by the BCUC.

The reason I bring this up is because if, let’s say, they do what BCUC suggested, which is to put the money into a regulatory account, it has to be amortized and expensed through the company’s income statement. Realistically speaking, even at the beginning, if they make the decision to terminate Site C, that will result in a $200 million to $250 million amortization expense that the company will have to start incurring. On top of that would be the $150 million revenue shortfall from a rate freeze.

Could the minister explain how BCUC could possibly approve a zero percent rate increase in light of the fact that it would cause a shortfall to B.C. Hydro of close to $400 million?

Hon. M. Mungall: My apologies to the member. Can she repeat the last bit of her question?

T. Redies: I know this is complicated, but I just want to try and be really clear here. If the government chooses to terminate Site C, it becomes an impaired asset. That impaired asset has to be dealt with either by a straight write-off to the company’s bottom line or, like the BCUC report suggested, it can be put into a regulatory account and then amortized over several years. If it is amortized over several years — B.C. Hydro was suggesting yesterday over ten years — B.C. Hydro is going to be facing an amortization expense for the write-off of somewhere between $250 million to upwards of $400 million when the full costs come out.

If you add that amortization expense to the revenue shortfall that the government is proposing with a revenue freeze, it’s a $400 million shortfall. So my question to the minister is: how could BCUC possibly approve a zero percent increase in rates, because it would put the fiscal situation of B.C. Hydro into jeopardy?

Hon. M. Mungall: With respect to the member, there are quite a number of hypotheticals in there. There’s a lot of speculation about two different items and then speculation about a decision that may occur by the B.C. Utilities Commission and speculation that may occur by the government. I’m not going to join in that speculation. I just don’t think it’s appropriate to prejudge any outcome of processes that have been set in place and have not had decisions on them yet.

M. de Jong: I’ve had a brief conversation with the Government House Leader, and I wonder if the committee might recess for just five minutes.

A. Weaver: With respect to the member opposite, the Opposition House Leader, he has not consulted with the House Leader of the Third Party. I would request that he do such consultation before any decisions are brought back to the Legislature.

The Chair: The committee will be in recess for five minutes.

The committee recessed from 3:55 p.m. to 4:02 p.m.

[R. Chouhan in the chair.]

Hon. M. Farnworth: I move that the committee rise, report progress and ask leave to sit again.

Motion approved.

The committee rose at 4:02 p.m.

The House resumed; Mr. Speaker in the chair.

Committee of Supply (Section B), having reported progress, was granted leave to sit again.

Hon. M. Farnworth: I call committee stage, Bill 16, Tenancy Statutes Amendment Act.

[4:05 p.m.]

Committee of the Whole House

BILL 16 — TENANCY STATUTES
AMENDMENT ACT, 2017

The House in Committee of the Whole (Section B) on Bill 16; R. Chouhan in the chair.

The committee met at 4:07 p.m.

On section 1.

Hon. S. Robinson: I just want to take a moment to introduce some staff that I have here with me today as we go through committee stage. I have Tyann Blewett joining me from our policy division, along with Audrey Panter. And I have Greg Steves, ADM for housing, who’s joining us in this process.

S. Sullivan: I would like to just make a couple of comments before we get into the whole bill. The bill is structured in a way that sort of mirrored, first, the manufactured homes and then the residential tenancies.

We do have a number of questions, although I must say that Her Majesty’s Loyal Opposition is very supportive of what you’re trying to do here. But there are a number of questions we have, and I know that the Third Party also has some issues they would like to discuss. I thought we would push most of the residential tenancy questions into the manufactured home section, because we think it would be easier to manage the process.

Some of the issues that we have are around some conversations we’ve had with people in the industry. Some of them are about the use of the fixed lease as a way to initiate a relationship between tenant and landlord. Some landlords use a very short fixed lease at the very beginning to suss out if there’s a good mix and if the tenant relates well to their fellow tenants.

Then there are issues around agricultural issues, especially when you have employment related to fixed lease. And then there are some other issues about recreational property, in that some feel there will be some serious issues created and that we may actually end up losing some rental properties if we don’t address these now.

[4:10 p.m.]

I know the Third Party also has some questions about definitions and such. I believe we can go through that. There are some issues around section 1 right away, so I will let you carry on, Mr. Chair.

J. Thornthwaite: I was wondering if I could get a definition of “sublease.” I have one question about a situation, so if you could perhaps give me a definition of sublease.

Hon. S. Robinson: A sublease situation is when a tenant has to leave for a short period of time, and with the landlord’s permission, they offer a sublease to another tenant, who then is going to move out at the end of that sublease.

J. Thornthwaite: The concern that my constituent had…. I’ll just read it. The concern is the requirement that a landlord cannot “withhold consent to a sublease or assignment if there are six months or more remaining in the term.” His point was that tenant mix is important not only to the landlords, who must arbitrate conflict between tenants, but to all tenants in a building. His point was that landlords should be able to determine that mix. Is that issue covered in this section?

Hon. S. Robinson: The six-month component is a subsequent amendment. That’s already in there. It has always been in there.

Sections 1 and 2 approved.

On section 3.

S. Thomson: I appreciate the chance to ask a couple of questions here, and I appreciate the agreement of the member for Vancouver–False Creek to allow an intervention here. I’m going to ask a couple of questions that may have some follow-up questions from the member for West Vancouver–Sea to Sky because it relates to the same issues.

It relates to the agriculture industry. I’m not sure whether this is the exact place where I should raise this issue. But since this section did deal with…. In the section notes, it talks about this being where you deal with the requirement around…. It generally eliminates the option of including a requirement to vacate the fixed-term agreement. It also makes reference to a regulatory framework that can provide circumstances where the requirement to vacate is authorized.

You may know that in the agricultural industry, a very seasonal industry, the industry has significant seasonal employment requirements. We have a program here in British Columbia called the seasonal agricultural workers program, an agreement between the province, the federal government and Mexico that brings in about 6,000 workers a year under a contractual arrangement or program and agreement. There are a couple of requirements in that program.

One is a maximum of eight months of employment, so those employees are here for various ranges — four months to six months to eight months. It can be spread over 11 months in some cases, depending on the nature of the employment.

There is a requirement to provide housing for the workers. We have a number of different circumstances that cover that off. Sometimes it’s on-farm accommodation. In some cases, farmers will purchase a rental unit, where they use that for the accommodation for the seasonal workers and then, in the gap, look to fill that rental accommodation during the time when the seasonal workers are back in their home country, back to Mexico.

[4:15 p.m.]

You could have other arrangements where a farmer will go out and secure a longer-term rental place, with the agreement that it will be part-time — part of the year with the seasonal workers that are under the program and part-time with filling that gap. One of the requirements in filling that gap is that if somebody comes in to fill that gap, you have to have the ability in the agreement that that person will vacate when the seasonal workers come back into the program. In many cases, it’s done on a fixed term. You’ll come in for four months or five months, with an understanding agreement.

What I’m probing, I guess, and wanting to make sure of is that we don’t have an unintended consequence in this, where those kinds of arrangements would suddenly be caught up in this, and the agriculture industry would lose the ability to manage that type of accommodation, particularly for a program that is meeting a very critical need for the industry.

I wonder whether the minister could comment. Have you contemplated that in the crafting of the legislation? Have you accounted for it? Is it covered in regulations? Do you see a significant set of regulations that are going to have to be put into place to address this? Just how might this be handled? Was it contemplated, and was it looked at in the development of the regulatory changes that are being proposed here?

Hon. S. Robinson: I do appreciate the question, recognizing that there are some unique challenges in different parts of the province and different ways of actually implementing the legislation.

We are aware that there will be situations where landlords use a vacate clause in fixed-term agreements for very specific circumstances. There is a range of exceptions that we’re looking at in terms of regulation. This is one of those sorts of examples, where there needs to be some understanding of these unique uses.

I do want to point out that in the act right now, an employer may end the tenancy of an employee, in respect of a rental unit rented or provided by the employer to the employee to occupy during the term of employment, by giving notice to end the tenancy if the employment is ended. That currently exists in the act.

S. Thomson: The nuance in this is that in some of these cases, the employment, because it’s part of a program, has not necessarily ended. You know, there’s an agreement that those employees are coming back under the program, so there’s sort of a continuing relationship and things in the program. I would be concerned that that provision that is specifically there now, may not, from a legal perspective, cover those circumstances. So just to make that comment and flag that for the minister in terms of developing the regulations.

I would also ask: has the minister reached out and had any consultation or engagement with the agriculture sector on this? The B.C. Agriculture Council — their western agricultural labour initiative looks after the seasonal agricultural workers program. Have you had some discussions on this issue with them?

Hon. S. Robinson: I want to assure the member that we are exploring potential exceptions in the regulation. I appreciate him bringing this forward, and we’ll certainly be sure to reach out to those particular sectors where this may be nuanced, as the member explained.

I want to really be clear that putting them in regulation sort of allows for some of that flexibility where we have some of these unique housing challenges. But we also need to make sure that we don’t create new loopholes for landlords to take advantage of renters, and I believe I do have the assurance of all members of this House that everyone is in agreement with that. Certainly, going forward with the regulation, I’ll make sure that we consult with the appropriate bodies.

[4:20 p.m.]

J. Sturdy: Just to carry on with my colleague’s comments here and to provide a little more clarity. The issue…. I think we all understand that accommodation in conjunction with employment can be terminated once the employment ends, but there are also situations where there is an opportunity for fixed-term accommodation in the off-season.

In the agricultural sector…. It may well be through the SAWP program, but also, there are many seasonal workers that come from across Canada and other places and come to pick fruit or come to work on farms for a number of months, and then that accommodation is no longer required over, let’s say, October, November, December, January, February.

What will happen is the employer, on accommodation either on their farm or accommodation that they acquire through rental or purchase off the farm, will put in place a fixed-term agreement for that off-season. Then they’ll put in other people. They’ll give them a chance to stay there five months, with the understanding that at the end of that five months, that accommodation is required for those seasonal workers. It’s not just associated with employment. It’s associated with just an opportunity to expand the rental accommodation.

One of those unintended consequences will be — and I can speak with confidence — that that accommodation, which would otherwise be out there for fixed term, will not be out there at all. Especially in the agricultural sector, the employer just cannot risk not having that accommodation available when they need it in the spring. I just wondered if this is something the minister would consider in terms of the regulation.

Hon. S. Robinson: Absolutely.

J. Sturdy: Thank you. I appreciate that consideration. I’d like to bring one other circumstance that may not have been contemplated to the minister’s attention, specifically around resort accommodations. The circumstances that I’m most familiar with are in Whistler, but I’m sure it’s common to a variety of different resort municipalities and others.

In the case of Whistler, there is zoned property that allows for two different uses. It allows for nightly rentals or longer-term rentals. A common practice on these nightly rental properties in Whistler, in particular — generally in the village core, but potentially in other places — is that over the course of the winter season, that accommodation would be provided as a nightly rental. Then, for the summer season, it would be a fixed-term rental.

Again, this type of issue could be problematic there. I’ve received numerous pieces of correspondence that suggest that the nightly rentals are too valuable. The default will be: “Well, we just won’t make any fixed-term rental accommodation available,” with the net result of reducing accommodation opportunities.

Hon. S. Robinson: That’s another example of what we would consider for regulation.

J. Thornthwaite: I wasn’t too sure whether this was a section 3 or a section 5 question, so I didn’t want to miss out on the section 3 part. A constituent has written me on this, the “generally eliminates the option of including a requirement to vacate the rental unit in a fixed term tenancy” section. He’s got a scenario here. I’d just like to read it out into the record.

“I understand this is proposed to prevent landlords from forcing tenants to enter a new tenancy agreement with higher uncontrolled rent at the end of a fixed term. However, there are circumstances that warrant fixed-term leases, especially in the case of short-term tenancy agreements where the landlord is renting out parts or all of their principal residence.

“For example, if a landlord is travelling for a fixed term, i.e. snowbirds, and wishes to rent out their property for a period that matches the fixed travel term; or if the landlord has a suite in their principal residence occupied currently by a family member, and family members may well be away for a fixed term, perhaps to school, etc.; or the owner of the property passes away, and their estate wants to rent it out for a fixed term while the estate is settled, the amendment acknowledges that there are circumstances which a landlord may include in a fixed-term tenancy agreement. But would those examples be included in that exemption?”

[4:25 p.m.]

Hon. S. Robinson: This is actually right at the top of our list, in this kind of situation, to include in the regulations. So if a landlord or close family member is leaving for work, school, vacation, that will be there in the regulation.

J. Sturdy: I apologize to the minister. I missed the earliest part of this debate. But I just wanted to confirm that my earlier comments were germane, not just to the manufactured home legislation, but to the Residential Tenancy Act piece as well.

Hon. S. Robinson: Yes. Thank you. That was set up by the member from False Creek — that it applies equally.

S. Sullivan: I would like to ask a question. I think it relates to several other sections, but it does relate partly to section 3. So maybe this is the time to bring it up.

One of the issues that has been discussed is that some landlords use the fixed-tenancy lease, for example, three months or six months, as a way to explore if the tenant-landlord relationship and the tenant-tenant relationship will be successful. The goal is not to subvert the intent of the rent control issues. It is just to find a way that if a tenant clearly does not have a good relationship with the other tenants around — maybe they’re disruptive or such — there is a way for them to end the tenancy very quickly at the beginning so that there won’t be a big administrative burden with the residential tenancy branch and these kinds of things.

I just thought I would probe the minister to see if she has considered that, or does she consider that a valid tool that some landlords have been using?

Hon. S. Robinson: We are aware that some landlords have been using the vacate clause as a way to test out tenants before they enter into a longer-term tenancy. But that was never the intention of the vacate clause. That was never the intention.

There are remedies under the act if a tenant is not appropriate. If either their behavior or their choices do not work for the tenancy, then there are certainly other opportunities for them — other parts of the act for them — to use to help alleviate that situation.

S. Sullivan: Okay. Yes. There are other mechanisms. From my discussions with some landlords, there is a lot of administrative burden that actually does create a burden for the residential tenancy branch as well as the landlord. Some of the landlords who are not as sophisticated as others find it a bit of a challenge to go through that. This may be a way to reduce the burden on the residential tenancy branch, to have an immediate way to end the tenancy at the beginning when it’s very clear that there is not a good relationship.

Hon. S. Robinson: I just want to say for the record that the very first thing we did before we even looked at this legislation was to increase the funding for the residential tenancy branch, because that’s what it’s set up to do — to address some of those challenges.

It’s important, I believe, that we make sure that the vacate clause is used for what it was always intended to be used. With this legislation, we’re closing the loophole that several landlords were using inappropriately. We’re just tightening up the act, as it was intended.

[4:30 p.m.]

A. Weaver: I thank the member opposite for raising this issue at this particular section. I was going to raise a similar issue at a subsequent section, as it does come in at numerous places.

I want to start by commending government for actually addressing an issue that clearly is an important issue and for providing additional resources to the rental tenancy process, because it is a very burdensome process. I do want to bring forward the concerns that were just expressed. It is an issue that I raised at second reading too. The problem is that, I suspect, there are a lot of unforeseen consequences that might arise if this is not thought through in its entirety.

I give an example, and the member opposite, the member for Vancouver–False Creek, highlighted a number. One is, let’s suppose, hypothetically, that you have a rental agreement with a number of renters, and these renters are living in the same quarters. The problem is that when you sign an agreement, you’re actually protecting other renters as well as the landlord. By signing a short-term agreement, you might have multiple people with tenancy agreements sharing rooms in a basement suite, and in fact, what’s critical is that you ensure that there’s a relationship not only between the landlord and the tenant but between the tenants themselves.

Now, we understand that there is a process to go through this by appealing, etc. But it is so burdensome, it is so impossible…. I mean, those who have had to try to remove a tenant, even with damage or not paying rent, can issue all the eviction notices they want, but the reality is that it’s very, very difficult to evict a bad tenant as it stands.

The beauty of a short term…. When I’m talking a short term — I think the member for Vancouver–False Creek and I have discussed this — we’re talking three months, four months. What we’re thinking here is that you’re giving a short-term contract — this would be all done in a regulatory fashion, obviously — which would allow for renewal but no increase in rent attached to the unit.

What this does is…. The advocacy groups were trying to attach rental increases to a unit. That, obviously, is not going to work, for a variety of reasons. However, you could take what they’re suggesting for a short-term lease of three months, say, and say that the rent cannot increase if the tenancy is a fixed-term lease for three months. Then, in fact, the rent increase is attached to the unit.

I’m wondering if the minister might consider this, as she discusses with civil servants, as a means and ways of protecting not only landlords from bad renters but other tenants as well. By having — pick a number; say, three months…. You will allow three-month fixed-term leases, but there can be no rent increase if a lease is terminated after three months. The rent must remain fixed at the previous value. This would allow landlords and other tenants to be protected in the case of an inappropriate relationship or a tenant who’s created some issues.

[L. Reid in the chair.]

Hon. S. Robinson: Part of what I’m hearing, actually, makes things more unstable for renters in terms of this idea that unless they’re on their best behaviour and no one complains about them, then they don’t know for three months whether or not they actually will have a place to live after 90 days. That creates more instability and, I think, more terror for the 1½ million renters in British Columbia.

There are provisions in the act that allow a landlord, should there be a problem tenant…. Even if it is with other tenants in the building or in the basement suite or whatever the arrangement is, there is an opportunity to have that tenant removed. That currently does exist in the act.

A. Weaver: With respect, again, I reiterate that every landlord in the province of British Columbia understands that there’s a process, but heaven forbid you actually have to enter into this process, because the process is very prejudicial, in my view and in many people’s view, against the landlord.

You could have tenants who are not paying rent for months. Try to get a tenant out if they haven’t paid rent for three months. You can get the sheriffs involved. It’s very, very difficult, even with the existing rules, because of the lack of teeth to those rules in a manner that actually allows the landlord to evict those bad tenants.

[4:35 p.m.]

So I appreciate, again, the potential for uncertainty. But the reality is, I would argue, there wouldn’t be uncertainty because right now landlords are using such clauses for short-term reasons, and they’re using them for precisely the reasons articulated by the member for Vancouver–False Creek. It’s just to test rental situations. The single most important thing for a landlord is to ensure they get a tenant who will be there for a long term. Every landlord wants to get the tenant who will never move out, because when they get such a tenant, they’re not painting the walls again, they’re not replacing this. They’ve got a stable tenant.

We’re talking about a few landlords and a few tenants in all regards here, but we’re focused entirely on the tenants who’ve been abused, frankly, by those few landlords who’ve created the need for this regulation. But I worry that if we’re not thinking about those few bad tenants as well and about protecting landlords, we could create troubles down the road.

I’m not going to belabour this, because we’re going back and forth. But I urge the minister, with her staff, to seriously reflect upon the comments made by the member for Vancouver–False Creek as well as these comments, as you move forward, to ensure that good landlords are protected — not just by having to go through this abyss of a process to evict bad tenants — and supported as well.

There is a danger here. In having a long conversation with the various associations and one particular association involved with landlords, there’s a lot of concern in the province of British Columbia about this from landlords, good landlords — forget the bad landlords; from good landlords — and that’s why I urge caution.

Hon. S. Robinson: I take the member’s concerns quite seriously, and our government does. That’s why we have increased funding to the residential tenancy branch significantly, with an additional $7 million over the next few years. And we are developing a compliance unit that will deal with challenging tenants and challenging landlords to make sure that is addressed, because we have heard that landlords need some teeth for the act. So we’re also making sure that we’re strengthening the administrative penalties.

We’ve heard that feedback, and we’re strengthening the act. We’re strengthening the ability of the residency tenancy branch to do its job as it’s supposed to. We’re also simplifying the process for accessing the residential tenancy branch and getting the help that it needs, and we’re going to be monitoring it closely. I have asked for feedback to make sure that it is doing what it’s supposed to do.

At the end of the day, this is about managing relationships. We know that a landlord-tenant agreement is a relationship, and we want it to work. I think they do work most of the time. When things do go sideways, it’s important to have an outside body that can either help manage that relationship or help dissolve the relationship.

The act has in it times in which you can dissolve that relationship. Making sure that we have a robust residential tenancy branch that has the capacity to do its job is very, very important, and we’re going to be monitoring it closely.

A. Weaver: I just wanted to thank the minister for her thoughtful response to the questions.

S. Sullivan: I thank my honourable friend for his concerns that he expressed. I have a bit of a different approach on this. It is clear that there are cases where a fixed term at the very beginning could protect other tenants. My concern is that if landlords do not have access to an easy way out of potentially difficult relationships, the landlords would now tend to want to be very careful about who they let into their space, especially in these times of very low vacancy.

[4:40 p.m.]

If a potential tenant shows up that maybe doesn’t present well, maybe has a dog or a child or whatever other issues, would the landlords be more likely, then, to be very conservative about who they would allow to take the tenancy? Would that possibly harm renters who are simply looking for a place and the landlord would be not as willing to take a chance and may opt for a sure thing — somebody that they think is not going to have a challenge with the relationship? I just wonder if the minister has considered that. It might be worthy of taking that into consideration.

Hon. S. Robinson: First of all, I do believe that landlords are always careful. This is a significant investment that they make, and sometimes it’s into their own home. I invite landlords to always be very careful about who they consider for tenancy. But I think the issue that the member is presenting is more about a zero vacancy rate. That’s actually the bigger challenge. I don’t think that it’s about the tenancy agreement and eliminating the vacate clause, the way we’re proposing to do that.

I think that he’s presented a very significant argument for why we need to make sure that we have more rental supply — that when you have a zero vacancy rate, landlords, who should be choosy, often leave out those who can’t access housing.

I also want to draw the member’s attention to the fact that tenants are protected from discrimination through the B.C. human rights code. So you can’t discriminate because there are children. That’s unacceptable, and we have a remedy for that as well. But at the end of the day, we need to make sure that landlords, you know…. There is no guarantee that if landlords use a fixed-term lease in the way that’s being proposed, they’re not doing so for prejudicial reasons. So we do need to make sure that there’s fairness in the system.

That’s what we’re proposing to do. That’s why our government has really committed some significant resource into the residential tenancy branch, because we think that will help to ease some of those challenges.

S. Sullivan: I just want to say that I don’t believe that it’s all about the low vacancy. It is about some tenants who, for whatever reason, don’t present themselves well, and the landlords would be concerned. As you note, it is a very big investment to take someone in, sometimes into their own home, and they would want to make sure that they’re not getting into trouble for themselves.

I think about the people who would be seeking a rental opportunity who may, for whatever reason, not present as well as other tenants and would, therefore, find it very difficult to get a good site, a good home. We may actually be making it harder for them. Whereas, if a landlord knew that there was a way out…. “If this just doesn’t work, okay, I can take a chance on this person.” They may be wonderful as a tenant, and the relationship would be good, but we wouldn’t have an opportunity to actually explore that because the landlord would say: “I don’t have this option. I’m going to go very conservative on this, and I’m not going to accept that tenant.”

Hon. S. Robinson: I do again want to remind everybody that this is really about providing some assurance and some security for renters. While I do appreciate that the example the member is providing sort of suggests that there are going to be certain people who will be left out in the cold and as a result, won’t be able to access housing that they need, I do believe that’s really a function of the vacancy rate.

[4:45 p.m.]

When we have a healthier vacancy rate, no landlord wants their suite to sit empty. They need to collect rent, so they will take a chance, because that’s who’s coming to see it. So when you have a better vacancy rate, I do think it’s better for all renters. Then there’s enough homes for people. But right now I think that the significant issue the member is raising is really more about having a near-zero vacancy rate in many of our cities.

J. Thornthwaite: Just a quick question follow-up, because there’ve been a lot of references to how these things will be dealt with in regulations. Does the minister have any idea of a timeline as to when these regulations would come into effect, since the bill could change agreements immediately, and landlords need certainty?

Hon. S. Robinson: I just wanted to consult with my team to look at some timing. In terms of the regulations, they will come into force when the bill is enacted. We definitely have one regulation for that right now. In a few more weeks, we’ll have some of the others as we go forward with consultation.

J. Thornthwaite: Would the minister or the ministry be interested in the comments that my colleagues and myself have been offering? Would you be interested in hearing from our constituents directly?

Hon. S. Robinson: Absolutely.

Sections 3 to 21 inclusive approved.

The Chair: Shall section 22 pass?

Some Hon. Members: Aye.

The Chair: So ordered.

The member for Vancouver–False Creek on section…?

S. Sullivan: I think that you passed the section, but I will just articulate it to the minister. The issue of the sublease — that a person could take a sublease, and that person can then have a fixed-term tenancy. Is there some potential for abuse, in that that might be a loophole that people could take advantage of?

Hon. S. Robinson: I just wanted to confirm that we were certainly trying to identify if there was that risk, and the only risk that we’ve been able to determine — but we think we’ve captured it — is if a landlord were to not properly…. So in order to do a sublease, the landlord has to give an okay in writing. We protected that so that everyone understands what the nature of the lease is and what the sublease is, so it would be covered off because we’d have something in writing.

S. Sullivan: So this is still possible as long as the landlord has the note? They can still have a fixed term? They can actually have a fixed-term lease?

Hon. S. Robinson: Yes, I just wanted again to double-check. Yes, it absolutely permits sublets. You’re still able to do that.

S. Sullivan: Does it permit fixed-term subleases?

Hon. S. Robinson: Yes.

S. Sullivan: There is a possibility that this could be used to circumvent the current system of rent control.

Hon. S. Robinson: No. The tenant has to return to end the sublease. The tenant is coming back.

[4:50 p.m.]

Sections 22 to 26 inclusive approved.

On section 27.

A. Olsen: I just would like to know, on section 27, Minister, if you could give some background on this section and why this change is needed.

Hon. S. Robinson: I wanted to make sure that I was able to cover off the entire rationale.

First of all, it was an oversight not to include this in the original act. The significance is to strengthen the administrative penalty framework and improve transparency overall. It’s making sure that the current system is strong enough to act as a deterrent and making sure that people are managing their landlord-tenant relationship well and that there are some penalties if they don’t behave in the way that they’re expected to behave and make decisions in the way that they’re expected to make decisions.

Section 27 approved.

On section 28.

A. Olsen: Could the minister please provide some of the circumstances that might be considered under the regulation that will allow for the use of a vacancy clause?

The Chair: Would the member kindly repeat the question?

A. Olsen: Just in terms of when a vacancy clause might be used and in terms of what’s being considered in the regulation for when that might be used.

Hon. S. Robinson: This has been canvassed in the House. I’ll repeat it, as well, so the member is aware. When we take a look at the regulation…. We are aware of situations where landlords use a vacate clause for specific circumstances. We recognize that there’s some opportunity where it does make sense. So we are exploring potential exceptions that would be in regulation.

An example might be a landlord or close family member is leaving for work. They’re going overseas for six months, and they’re expecting to come back. That might be a fixed-term lease with a vacate clause. Or you rent out your basement suite for your kid or whatever or someone goes away to school. We’re looking at employment. We’ve heard about seasonal workers and making sure that there is some housing — seasonal tenancies.

[4:55 p.m.]

Sale of property. I think there was another example provided by a member opposite of a home after somebody dies. They’re holding on to the property, and they want to lease it out until they sell the home.

There are certainly some opportunities that we’re exploring to include in regulation. This provides us with the flexibility. It makes sure that we close the loophole and recognizes that there are some circumstances where it makes sense to have a vacate clause.

S. Sullivan: A question to the minister. You would get a handle on all of the options and the opportunities and the scenarios where someone might want to use the vacate clause in a legitimate way. If you haven’t covered some of them and we discover something in the near future, is there a way for that to be dealt with quickly or does that have to then go through another process of regulation? Or how long would that take?

Hon. S. Robinson: I want to point out, first of all, that by providing resources to the residential tenancy branch, we have an opportunity to track if there are patterns. But that can be done by order-in-council, so it’s a relatively quick process, as opposed to this, which takes a lot longer.

Sections 28 to 37 inclusive approved.

On section 38.

S. Sullivan: I note this is about the security deposit and pet damage deposit as being double the portion of the security deposit. Has that not always been the case, or is that new?

Hon. S. Robinson: This is section 30, which is the order for return of security and pet damage deposit. It’s always been the case. We’re just providing an expedited opportunity because of the lengthy amount of time that it can take. This is an opportunity that will just make things much easier for all parties.

Sections 38 to 50 inclusive approved.

On section 51.

A. Olsen: I’m just wondering if the minister is concerned that the provision here will change the terms of the contracts that were already signed by two parties. Perhaps there might be some impact there. Maybe the minister can talk a little bit about that.

Hon. S. Robinson: Can the member just signify which section he’s referring to?

A. Olsen: Section 52. The last section here.

Section 51 approved.

On section 52.

[5:00 p.m.]

Hon. S. Robinson: I appreciate the member’s question about this piece in section 52. The significance of this is that without making sure that we had a good transition, 1½ million renters were at risk of being asked to live out their tenancy and then have a bump in the rent. That was a pretty significant risk to the 1½ million renters in our province.

S. Thomson: I was going to ask question this earlier and, in the haste, went by the section. It gets covered here, too, in the transition section, which really, in a sense and in application, is providing retroactive provisions of the legislation. Maybe I’ll ask the minister.

Firstly, I know that in the process of drafting legislation, when it comes through, it gets reviewed by the Attorney General’s department. It is either — I forget the colours — red-flagged or yellow-flagged or green-tagged. Were concerns raised by the Attorney General’s department in the legal review of this around potential challenges that may arise because of a retroactive application of legislation on agreements that were already in place?

Secondly, did the minister consult with landlord associations and those groups on this provision and the retroactive provisions? Did they raise concerns, a significant level of concerns, about a retroactive application of the legislation?

I understand what the legislation is trying to do, but were those concerns flagged, raised by legal counsel? Did the minister assess the potential of a legal challenge and risk to the retroactivity of this component of the legislation?

Hon. S. Robinson: First of all, I learned a new word. It’s called “retrospective.” This is actually, technically, not a retroactive act. That would require going back to tenancies that are ended. Retrospective is when they’re in progress. Certainly, I had that discussion with others, and the word is actually called retrospective.

You can add that, and I encourage any of you to use that in question period — retrospective.

Legal took a look, and it was fine. The thing that’s important to recognize about this is forcing tenants to leave and ending tenancies. That’s not what we’re intending here. Making sure that there’s a retrospective piece is certainly supported, and we didn’t get any flags.

S. Thomson: I appreciate the comments from the minister. That is a nuance or a new approach to it. I dare say it is nuanced in terms of retrospective and retroactivity. It still will have that intent of applying legislation backwards or retrospectively or retroactively in this.

I appreciate that the minister has advised that no flags were raised. I would think, though, there is still the potential that this section may get challenged because of that retrospective nature of it. I know she is aware of it. Otherwise, they wouldn’t have had to address that through the Attorney General.

[5:05 p.m.]

I just wanted to note that I think there is still that potential. Even with supporting the intent of what you’re trying to achieve here, I think there is potential that that could take place.

Hon. S. Robinson: I had neglected to respond to another part of the member’s question relating to consulting with landlord organizations. LandlordBC is well aware of this provision that we have put in. They stood with us at the announcement and are pleased to see this going forward.

Sections 52 to 62 inclusive approved.

Title approved.

Hon. S. Robinson: I move that the committee rise and report the bill complete without amendment.

Motion approved.

The committee rose at 5:06 p.m.

The House resumed; Mr. Speaker in the chair.

Report and
Third Reading of Bills

BILL 16 — TENANCY STATUTES
AMENDMENT ACT, 2017

Bill 16, Tenancy Statutes Amendment Act, 2017, reported complete without amendment, read a third time and passed.

Hon. S. Robinson: I call second reading of Bill 15, Local Elections Campaign Financing Amendment Act, 2017.

[5:10 p.m.]

[L. Reid in the chair.]

Second Reading of Bills

BILL 15 — LOCAL ELECTIONS
CAMPAIGN FINANCING
AMENDMENT ACT, 2017

Hon. S. Robinson: I move that Bill 15, the Local Elections Campaign Financing Amendment Act, 2017, be now read a second time.

This bill proposes amendments to the Local Elections Campaign Financing Act that will ban corporate and union donations, put reasonable limits on individual contributions and ban out-of-province donations at the local level.

Our government is committed to improving the lives of British Columbians and listening to the things that they are asking for. British Columbians have said, loud and clear, that they want to ban big money from their election process. We’ve heard from the public, and we’ve heard from local governments who share our goal of successful and fair election campaigns that are free of the influence of wealthy donors. We have listened to leaders from communities throughout British Columbia about how we can level the playing field for local candidates in our province and limit the influence of big money in our democracy. People have said that they want their democracy back, and our government has listened to their desires.

This bill responds to that. We developed this bill following consultations with key stakeholders, such as Elections B.C.; the Union of B.C. Municipalities, an organization that represents B.C.’s 189 local governments; and the Islands Trust. As local elections also include boards of education elections, the Ministry of Education was consulted, as was the B.C. School Trustees Association.

The proposed bill will amend the Local Elections Campaign Financing Act for the 2018 general local elections, which are happening this upcoming October, a year from now. The proposed bill will prohibit organizations such as unions, corporations and individuals who are not British Columbia residents from providing contributions to candidates, elector organizations and third-party advertisers.

It will also establish an annual $1,200 limit on an individual’s contributions to a candidate’s campaign as well as a $1,200 limit on an individual’s contributions to an elector organization’s campaign, including all of its endorsed candidates. The $1,200 contribution limit applies to the election campaigns of independent candidates and elector organizations equally.

Making sure that everyone can participate and that we have fair elections is really important, and making sure that we put a contribution limit on it that was reasonable was one of the key things that we did in this bill. It means that one donor’s total contributions to the election campaign for an elector organization and all of its endorsed candidates cannot exceed $1,200 per year.

We want to make sure that big money is not influencing our local elections. These contribution limits will apply provincewide for the 2018 general election for a straightforward transition to the new rules. We do understand that factors like population and type of local government may affect what is considered an appropriate contribution limit.

We recognize that all these communities are unique, and that’s why this legislation includes flexibility for contribution limits for future local elections to be set by provincial regulation, a regulation which could take into account community differences. We will continue to work closely with the UBCM to determine whether any changes to the limits are required, and we will have some good information after the 2018 election that will help us move forward on that.

The amendments will also make a minor change to the definition of “third-party advertiser.” Due to the small scale of many local elections, the current definition of a third-party advertiser could limit political self-expression, a very important part of our democracy. So third-party advertisers must register with Elections B.C. and record and disclose information about contributions and expenditures related to election advertising.

This amendment is intended to help ensure that people who put up their homemade signs and want to express their opinions and their thoughts about a local election are not actually considered a third-party advertiser, and therefore, they won’t be subject to those stringent rules.

Additionally, the legislation makes several amendments related to the contribution source bans and contribution limits. For example, the legislation establishes that only savings institutions and eligible individuals can make loans to candidates, elector organizations and third-party sponsors to use in their election or advertising campaigns and applies specific rules to these loans.

[5:15 p.m.]

The amendments in this bill have been made in consultation with staff from the Ministry of Attorney General so that we have some consistency with similar amendments to the Election Act through Bill 3. That was a really key objective.

Once again, we heard for a number of years that people really do want their democracy back. They really want to make sure that they’re fair and that people can participate in a meaningful way — so making sure that we have a level playing field, making sure that we have rules that everybody can play by and participate in, and, really, eliminating the Wild West reputation that British Columbia has received over the last number of years.

I do want to point out that there are some differences between the proposed amendments in this act and the amendments to the Election Act, which has been debated in this House. These differences flow from the unique nature of local elections and local election campaign financing issues. In many communities, people can just spend a few hundred dollars and get their flyers out — and that’s great — and they could get elected quite handily. We know, provincially — that if only it were that easy and that inexpensive. I do want to point out that unlike the amendments proposed in the Election Act, we don’t have a provision for public financing as there has never been any public financing or tax credit at the local level.

There are some things that this legislation does not do. For example, contribution limits will not apply to third-party advertisers as that would require some significant policy work and legal review, and we just don’t have the time to actually undertake that work and be ready for an October 2018 election. We felt that it was important to deal with the much bigger issue, which is the influence of large, significant donations that really do take away from our democracy.

The other reason why we didn’t put in this legislation for contribution limits was that there are new rules on election expenditures that are coming into force for 2018 which limit them to 5 percent of a mayoral spending limit in a local election in larger communities. For smaller communities, the spending cap for a third-party advertiser is $750. Because the expense limits are coming into force, we believe that that will actually help manage that so that we may not actually have to do contribution limits.

We’re committed to monitoring very closely, going forward, and seeing if it is a problem, and we’re prepared to do that policy work to address that, should it be a problem.

The amendments will apply — I think it’s important for everyone in this House and for British Columbians to know — to all local elections that are scheduled to take place next October and any by-elections thereafter. If there are by-elections between now and next October, these will not apply. We just couldn’t get this ready in time, so really, it starts with the October 2018 election and thereafter.

The legislation also establishes some transitional rules which will help guide campaign participants, third-party advertisers and the public between the old rules and these new rules. These new rules will be made retroactively — not retrospectively — effective to the first day after the first reading, which was October 31, to prevent prohibited contributions from being made between the time that the legislation was publicly introduced and royal assent.

With these changes, British Columbia will join the number of other jurisdictions across Canada that already impose restrictions on who can provide contributions and implement contribution limits in local elections. Alberta, Manitoba and Ontario already have this kind of legislation.

In conclusion, the proposed amendments will introduce significant changes to the Local Elections Campaign Financing Act, consistent with our government’s commitment to a fairer framework for election campaign financing, something that British Columbians have been begging for, for a number of years. These amendments, in addition to campaign expense limits, which apply for the first time for the 2018 general local elections, will enhance the integrity and fairness of local election campaigns, put people back at the centre of elections and get big money out of our local politics.

I look forward to further debate on this bill.

T. Stone: It does give me a great deal of pleasure to rise and speak to second reading of Bill 15, the Local Elections Campaign Financing Amendment Act, 2017.

[5:20 p.m.]

Before I go through my remarks, I just want to acknowledge the support that the minister provided through her staff, who were very kind in making themselves available for a briefing that I found very informative. I certainly appreciate the fact that they answered all of our questions that we had at that time. That makes this whole process, I think, that much more collegial and more efficient.

At a high level here, I can say that the official opposition supports this piece of legislation. We do have some areas of concern that we will explore in more detail in committee stage. Many issues that we thought maybe were bigger issues than they are were sorted out at the staff level in that briefing. Again, to the minister, thank you for making your staff available.

These amendments really build upon changes that our former government brought in, in 2016, when we amended the Local Elections Campaign Financing Act. As part of those changes, we modernized B.C.’s local elections. The whole point of that, as the minister mentioned in her remarks, was to really maximize fairness, transparency and accountability. I think there’s a lot of support across all sides in this House to do everything we can to strengthen our democracy here in British Columbia.

The changes that we brought forth, that we put in place, dealt with expense limits. It was all about helping to level the playing field for all local government election candidates, including those for councils, regional district boards, school boards and certain special purpose bodies. The expense limits also applied to third-party advertising sponsors. There was a cap placed on the expense limits. Those follow a consistent formula for all candidates, regardless of where they run in the province, and are generally based on the population of the election area. We agree, in the official opposition, that it’s very important to provide a level playing field for those interested in seeking and potentially holding a seat within local government.

The changes that were made back in 2016 followed extensive public consultation. There were 31 broad recommendations that came out of a joint task force, in addition to a significant amount of feedback and advice that was provided by the Union of B.C. Municipalities and the B.C. School Trustees Association. Those changes all come into effect as part of the 2018 local government elections.

Now, this particular piece of legislation here, Bill 15, really builds upon that foundation that was put in place by our former government. While the definition of what constitutes a contribution was provided for previously in the Local Elections Campaign Financing Act, it’s the concept of limits now and the fact that the government is introducing limits to those contributions that’s really the hallmark or the centrepiece of this piece of legislation.

I will say that as with Bill 3, the Election Amendment Act, we certainly support the ban on union and corporate donations and, generally, the campaign finance reform that is provided for through this piece of legislation. Again, these amendments, these proposed changes, build upon changes that we made previously. It’s all about strengthening our democracy, underpinning that foundation of democracy here in British Columbia. And, yes, it is about getting big money out of politics, and that is a good thing moving forward.

We certainly support the changes that are proposed in this legislation that relate to contributions coming from individual donors only and, indeed, B.C. residents. No more contributions flowing into British Columbia from those outside of the borders of British Columbia. That is a provision that is provided for in the Election Amendment Act, which also bans out-of-province donations. That’s a good thing.

[5:25 p.m.]

I know I speak very strongly on behalf of the official opposition when I say that we’re very happy that there are no taxpayer subsidies provided for in this piece of legislation. We certainly would hope that the government would rethink their decision to use taxpayer dollars to fund provincial political campaigns, as provided for currently in Bill 3. It has been pointed out to us by more than a handful of people that it seems a bit inconsistent to not feel that taxpayer subsidies make sense or have a place in local campaigns but that they have a place in provincial campaigns.

It is, and I have said this in the context of debate on Bill 3, absolutely wrong to be digging deep into the taxpayer’s pocket to fund political campaigns with taxpayer subsidies. We will continue to try to get the government to see the error of their ways on Bill 3, which is actually reflected well in this bill, Bill 15 — no reliance on taxpayer subsidies. As I said a moment ago, obviously we’re pleased that the Union of B.C. Municipalities has been thoroughly engaged and consulted in the drafting of this bill and the components contained therein.

Now, there are some areas of concern that I will quickly highlight and then dive into in a bit more detail on a few of them. First off, we are going to need a bit more clarification — and this, I’m sure, will come through the committee stage process on this bill — with respect to the lack of retroactivity in this legislation. There is certainly, again, an inconsistency between the lack of retroactivity here, whereas the provisions in Bill 3, which deal with the provincial election campaign finance reforms, are intended to be retroactive.

We’re not clear, in the opposition, as to why the government would feel it is necessary to be retroactive in nature with respect to Bill 3, and provincial election campaign finance reforms, and not be retroactive with respect to this piece of legislation in the context of local campaign finance reform. We will canvass that in more detail in committee.

The lack of contribution limits for third-party organizations is also a potential loophole that bears more examination.

Now, I did hear the minister, in her opening remarks, actually acknowledge that there is a willingness on the part of government to potentially look at that issue, albeit only after the 2018 election if it is deemed to be a problem. I would suggest, or surmise, that it is problematic to not be considering contribution limits within the context of third parties. If we truly want to ensure that there is no influence on the political process, then ensuring that we are doing everything we can with respect to the influence of third-party organizations is something that I think is very important.

I do understand that there is a tremendous amount of policy work that likely is involved in diving deep into that — looking into contribution limits with third parties — but it’s a bit disappointing and, I would suggest, regrettable that that policy work hasn’t been done in time to be concluded in this legislation. We’ll talk about that more in committee stage.

We have been speaking with many mayors and councillors, elected officials at the local level, since this Bill 15 was first introduced in this chamber. It must be stated very clearly that there is a fair bit of concern and frustration amongst a lot of locally elected officials with respect to the $1,200 maximum individual contribution limit in the context of those who finance their own campaigns. I’m speaking very specifically about the dozens and dozens of small communities spread across British Columbia.

It is very common in a community like Chase, in my riding, or Barriere or Fernie or Lumby — or Cumberland, for that matter, on Vancouver Island — where candidates for the office of mayor or council or school board don’t spend a lot of money. They might spend a couple thousand dollars. They might spend $3,000. It’s just about getting some signs and maybe an ad in the small newspaper.

[5:30 p.m.]

In most cases, those local officials — those mayoral candidates, councillor candidates, school board candidates — will simply opt to finance their own campaigns. They will contribute two grand, three grand, five grand to their own campaign. We’re not talking about multi-millionaires here, the Donald Trumps of the world who are buying their election. We’re talking about a lot of small towns, where it is not outside the realm of normal for local candidates to spend two, three, four, five grand.

In the city of Kamloops — which is, actually, not a small town; it’s a city of 100,000 people — you’d be hard-pressed to find many candidates running for mayor or for council that do any fundraising. Most of them don’t spend very much, which is a reality in and of itself. Those that do spend a little bit will often finance their own campaigns.

[R. Chouhan in the chair.]

It has been expressed to us in the opposition — and again, we’ll canvass this in more detail in the committee stage of the bill — that there is a fair bit of frustration within small communities that this $1,200 maximum individual contribution limit applies also in the case of financing or self-financing your own campaign.

We’ve also been in discussions with a number of the larger communities, mainly in the Lower Mainland, where there are electoral organizations. While I think we generally support the intent of what this bill strives to achieve, insofar as the $1,200 maximum contribution to an electoral organization and/or to an individual who runs with an electoral organization, that it’s one or the other…. We generally understand the intent behind that — to get big money out of politics, really level the playing field.

There are concerns that have been expressed, which I think are valid, to an extent, in the larger centres in Burnaby and Surrey and Vancouver, where there are electoral organizations. My understanding is that there are approximately 16 municipalities in the province, mostly in the Lower Mainland, where there are electoral organizations.

There are a number of folks actively involved with these electoral organizations who really feel that the contribution limit of a maximum of any combination of $1,200 contribution to the electoral organization and candidates that might run under the banner of that electoral organization is really going to constrain the ability of electoral organizations to recruit new candidates, new blood, and be able to adequately support the campaigns of those new individuals. It’s important to be cycling. You want to see rejuvenation. You want to see renewal in any political organization, at any level of government.

I certainly don’t think that that is necessarily a point that warrants not supporting this piece of legislation. But I do think that perhaps there is an unintended consequence inherent in this legislation, insofar as how restrictive the $1,200 maximum contribution limit is for any combination of donations to an electoral organization and candidates who run for that organization — again, in the context of really enabling those electoral organizations to go and find new people and put those people’s names out into their communities. It costs money to run a good campaign in a large city like Burnaby, Surrey, New Westminster or Vancouver, not to mention other mid-size cities in other parts of the province.

I’ve also had a number of individuals express frustration that this legislation does not provide for income tax credits for local contributions. Income tax credits are available provincially and federally. They’ve never been available locally, so this piece of legislation continues what has been the practice at the local level. But again, it’s a valid question to ask in the context of these new rules. If there is to truly be a level playing field within all levels of government, perhaps there is some merit to tax credits being made available at the local level. That is something that we may ask a few questions about in the committee stage as well.

[5:35 p.m.]

With respect to this, the minister mentioned in her remarks the concept of wanting to change the definition of third-party advertisers in the context of this piece of legislation. I do think that that’s important. I do support the proposed definition, insofar as the minister is, I think, right. Again, in the context of small communities, you certainly don’t want someone who has gone down to their local art supply store and has spent $50 or $100 on some cardboard and some wooden posts — individuals that might make their own signs and make their own posters and those kinds of things for local campaigns…. You don’t want a definition which is pretty rigid and stringent at the moment to capture those types of situations.

But I would also suggest that there is an issue of free speech associated with this particular issue as well. I’ll be interested to know in committee…. We will ask the minister just what the advice was that she may or may not have received with respect to any potential constitutional challenge around saying to an individual, whether you’re in a small town or a big city, that you can’t go and take out an ad in your newspaper if it costs more than a certain amount.

If you’re self-financing and you’re paying for every aspect of the campaign out of your own pocket, including perhaps a radio ad or a perhaps an ad in your small newspaper, that the value of that contribution on your own behalf — it’s coming out of your own pocket for the good of your own campaign — somehow should not be allowed because it exceeds the $1,200 maximum contribution limit…. I do have an issue with that.

Again, I think this may be an unintended consequence of this piece of legislation. The intent is clear, to get big money out of politics and ban union and corporate donations. That’s good. But precluding someone in Barriere who wants to seek a school board position there and wants to take out a few ads in the paper and maybe run an ad on NL Radio out of Kamloops…. Barriere is captured in their catchment area. The total cost of that is, say, two grand. Not being able to actually do that advertising out of your own pocket to finance your own campaign because it exceeds a $1,200 limit doesn’t seem fair to me. So we’ll dive into that in a little bit more detail in committee as well.

There are a number of other details provided for in this legislation that we’ll get into more detail. We do understand that there is a very clear separation or distinction made in this legislation between the concept of an electoral organization and the concept of a slate — the main difference being, in an electoral organization, candidates are deemed to be part of an electoral organization if the name of that electoral organization actually appears on the ballot under the individual’s name, whereas a slate might be just a group of people that are united because of a common issue. They might be sharing some space on a sign. They don’t get caught in the definition of electoral organization. That’s an important distinction, again, in the context of small communities and small rural communities around the province.

There are a number of provisions in this legislation that deal with loans. I do appreciate the flexibility that’s been built in, in terms of allowing loans from financial institutions with no limit to those loans. That’s based on an assumption of there’s a reasonable expectation of repayment, and if the repayment doesn’t occur, then the loan would then be deemed to be a contribution. I think that’s entirely reasonable.

[5:40 p.m.]

The bill does allow for loans to be provided from individuals — again, limited to that $1,200 maximum. The distinction there is that there’s no expectation of repayment from that individual and that no loan guarantees are required for loans from individuals. I think there is a fair bit of flexibility that’s built in there. We’ll have some questions for the minister, when we’ll dive into that in more detail.

At the end of the day, we’re pleased that this piece of legislation bans union and corporate donations. We’re pleased that this piece of legislation does not allow out-of-province contributions. We support the fact that there are no taxpayer subsidies provided for in this legislation. We would hope that that was the case with respect to the campaign finance reform at the provincial level that the government has brought forward.

We will have questions around the retroactivity aspects with respect to the lack of a contribution limit for third parties. We will want to discuss with the minister the concerns that we’re hearing, particularly from smaller communities, rural communities, where candidates self-finance.

We will want to talk a bit more about the ability of electoral organizations to continue to be viable moving forward within the context of these changes.

With that, I again thank the minister for making her staff available for a very good briefing prior to the resumption of the process on this piece of legislation. We’ll look forward to getting into a lot more detail with the minister when we get to committee stage.

Hon. J. Darcy: I welcome the opportunity to rise in my place and speak in support of the Local Elections Campaign Financing Act. I congratulate the Minister of Municipal Affairs and Housing for bringing this forward.

I must say, off the top, just listening to the member opposite from Kamloops–South Thompson, he speaks as if the former government, now members of the opposition, have supported local election financing reform for many, many years, when in fact we know that not to be the case. They haven’t supported finance reform at the provincial level nor at the local level, despite many, many attempts by people now on this side of the House raising these questions and introducing private members’ bills over many years.

It’s a situation that resulted in British Columbia becoming known around the world, frankly, as the Wild West and a situation that certainly encouraged political cynicism. That’s the most detrimental thing about it — the cynicism that it encouraged amongst citizens in British Columbia.

This bill really is a step forward in putting people at the heart of politics, not just those with deep pockets. Our government has decided — and I’m very proud that our government has decided — to reform local election campaign financing in order to limit the influence of big money in local elections. This will put people back at the centre of community politics and local government decision-making.

The legislation will ban corporate and union donations, put reasonable limits on individual contributions and also ban out-of-province donations at the municipal level. We have heard from the public on this issue, I’ve certainly heard from constituents in New Westminster on this issue, and we have heard from local governments on the issue. They share the goal that we have worked for, for many years and now are able to put in place, which is that we have fair election campaigns at the local level, election campaigns that are not influenced by big money.

We’re acting on what we’ve heard from leaders in communities throughout British Columbia, from people in our communities, that it is absolutely long overdue that we level the playing field for local candidates. As the Minister for Municipal Affairs and Housing has spoken about so eloquently, we have consulted with key stakeholders, like Elections B.C., UBCM, 189 local governments, the Islands Trust as well as the B.C. School Trustees Association.

As I’ve mentioned, we will be banning corporate and union donations. As well, reasonable limits on individual contributions will be capped at $1,200. Contributions for each candidate or electoral organization — $1,200 per donor per year. And has also been stated, contributions can only be made from residents of British Columbia who are Canadian citizens or permanent residents.

[5:45 p.m.]

This bill also speaks to banning donations from corporations, unions or other organizations to local candidates, to their electoral organizations, to third-party advertising and assent-voting advertisers, all of which will be strictly prohibited.

I want to congratulate the minister, also, for ensuring that these changes are put in place in time for the 2018 local elections.

Why are we proposing these changes? Well, because British Columbians want fair election campaigns. British Columbians want to have confidence that their local and provincial governments will be working for all voters, not just those who are able to write the largest cheques.

We are taking action on this at the provincial level, and we’re also taking action now at the local level to make sure that democracy at the local level works for everyone, not just for a select few. It’s something, as I’ve mentioned, that local governments have been asking for, for many, many years, going back to 2009. It’s an issue that, in opposition, we raised repeatedly — and proposals that the previous government refused to act on year after year.

I am very proud that our government has listened and has acted, especially now, with local government elections just around the corner. These new rules will apply to all local election campaigns, starting with the 2018 general local elections, and any by-elections that follow that, including for councillors, mayors, electoral areas and school trustees.

I am very proud that, beginning with the now Minister of Finance, the member for Victoria–Beacon Hill, since 2005, we’ve been introducing legislation for campaign finance reform eight times. And eight times, I have to say, despite this last-minute conversion after the results of the last election, it has been the B.C. Liberal government and the members opposite, many of whom are still sitting there, who blocked this legislation time and time again. That led to us being known as the Wild West right across the country and right around the world.

This is really about restoring faith and trust in our political system and restoring faith in our democratic system of government. That’s why we have introduced this legislation. It’s also why we’ve introduced provincial financing reform for provincial elections. It’s also why we’ve introduced the lobbying registration act, rules for lobbyists so that the public can know who it is who’s meeting government and about what and when.

Finally, this is also very closely connected to the legislation that we’ve introduced on proportional representation, because a system where you have first-past-the-post essentially means that for millions of British Columbians — or hundreds of thousands of British Columbians, depending on the election — their vote essentially does not count.

First-past-the-post has not served us well. It does not put people at the heart of our democracy and at the heart of the political system. I think that change needs to be seen together with what we’re doing on provincial election financing reform and the Lobbyists Registration Act reform as well as this piece of legislation. They really are all part and parcel of the same approach, which is about putting people at the heart of our democracy and making sure that it is individual voters, their desires and their vision for the future that are able to be reflected in outcomes of elections, whether at the provincial or the local level.

Again, I conclude by congratulating the Minister of Municipal Affairs and Housing. There are many issues that may in the future, after the next election, require further discussion, as the minister has indicated. But I think it shows real leadership that our minister and our government have acted on this quickly, rather than if we had listened to the questions that we’re hearing from the opposition. Or if we had followed the path of the previous government, we could be waiting 16 long years before anything was done.

It’s good to see that there does seem to be consensus at this time on this bill. That would be wonderful. That is the desire of the people of British Columbia. It’s certainly what I hear from people in my community.

[5:50 p.m.]

Thank you for my being able to take my place in the debate. I look forward to the opportunity of voting in favour of this legislation and having this enacted as the law of British Columbia.

Deputy Speaker: The member for Saanich North and the Islands. [Applause.]

A. Olsen: Thank you. Wow. That never gets old.

I come to this House from local government. I was elected to the Central Saanich council table almost a decade ago for the first time. Many of our colleagues in this House have taken a similar path to becoming an MLA. It’s a great place to learn how to work with like- and different-minded people, to problem-solve and, ultimately, make a thoughtful, evidence-based, informed decision. Raising your hand or standing and being accounted for is actually a much more difficult act than it perhaps appears.

I have a tremendous amount of respect for our colleagues in local government. They are passionate about their communities, and they want the best. There is so much value to the respectful difference of opinion around a council table. I often said that it was our job to find a way to represent 16,000 differences of opinion in Central Saanich with a single yes or no vote. It is the diversity at the council table that reflects the diversity of our friends, our family, neighbours and neighbourhoods.

This House has a lot to learn from that. When we form these political tribes and consolidate power within them, effectively muting the diverse voices that exist to portray a strong political front in public, I’m not sure that the diversity of British Columbians is truly or fairly represented. In my mind, that is the most important reason why majority governments are problematic. Sure, they make our lives much easier, when we can turn over the responsibility of representing our constituents to a powerful party leader and ride the pine for the next four years. But are we truly reflecting the diversity of British Columbia?

I had an exchange with a former colleague of mine from the Central Saanich days on Facebook yesterday. He was in Costa Rica, and I was in my office in the basement. I think he was probably in a warmer, better situation than I was in. But when we were elected to the Central Saanich council table, he was to be my nemesis. For the first couple of years, we did battle with each other across the table, until we realized our community was stronger if we allowed our differences to exist and, instead, worked together to move the community forward. So we focused on common ground. To this day, we have a place to discuss and debate differences in a mature, respectful way. My nemesis has become an important adviser to me.

It was the experience of running small, inexpensive campaigns that taught me I could be a more effective representative of the diversity of opinions in my community if I focused on quality interactions, integrity, trust, accountability and transparency rather than endless amounts of cash, newspaper ads and mailouts. The latter promotes closed-mindedness, an unwillingness to work with others. It perpetuates the “I am right; you are wrong” mentality that we are all vulnerable to in this House.

I attended the Association of Vancouver Island and Coastal Communities in the Union of B.C. Municipalities conferences every year. I found them to be incredibly useful to share ideas across jurisdictions, to incubate ideas and to ensure that there aren’t 200 communities all trying to recreate the same wheel. This last UBCM was a special convention to me for a number of reasons, not the least of which was the fact that it was the very first convention that I attended as a member of this House.

While the relationship-building across local governments was always a highlight of my time at the AVICC and UBCM, there was always one major frustration. No matter how much work we did as local government officials to advance issues and solutions that were important to us and our communities, it felt like the provincial government did not hear them. Sure, we took them up on their offer to sit for 15 minutes and share our experience. But I often left those meetings feeling like the decision was made. The path was chosen, and the minds were closed.

Each time I sat through the final speech of the convention delivered by our Premier, I would listen for the important issues raised by the delegates, yet I’d hear very little.

[5:55 p.m.]

Instead, we were delivered a flowery speech laden with the Premier’s agenda, the Premier’s priorities. I would leave the convention disheartened by the disconnect between the two levels of government.

Ultimately, I am here today because I wanted that to change. I have promised the UBCM and my current and former colleagues in local government to never forget those days, to never forget that feeling of disheartenment. Whether it was the chastised B.C. Ferries report, ignored Strong Fiscal Futures policy, derelict boats or urban ungulates, the provincial government has had a culture of ignoring the most important partners in creating a vibrant, innovative province for the 21st century. That is local government.

When I was the interim leader of the B.C. Greens, a time when our party had scarce resources, I lobbied our staff to make sure that we attended the UBCM, that we were present and attentive to the needs of local leadership.

That is why I stand in this House today and offer my thanks to the minister and to the government. How local government elections are funded, how contributions are made — the amount of money in local elections is on the agenda today because our government decided it was a good idea to listen to the mayors, councillors, regional directors and trustees and to speed up a policy process that our local government elected officials have long been advocating for.

Without any doubt, this bill is an enormous step forward for local election financing in B.C. I’m very proud of the government for moving decisively on this issue and bringing this first round of changes before the 2018 election. For all the attention that the massive holes in our provincial financing laws received over the past couple of years, our local government elections have been just as bad if not worse. For too long, local elections have been allowed to be the black box of financing — no limits, limited disclosure requirements, donations from any source. This is not how you ensure a strong democracy.

Our caucus, the B.C. Green caucus, approached campaign financing reform with a number of objectives. First, we wanted to eliminate the influence of special interests in B.C. elections. This meant ensuring corporate and union donations of all kinds were banned, as were donations from foreign sources. Second, we wanted to see B.C. have the lowest contribution limits in the country. Third, we wanted to reduce the overall spending limits. And finally, we wanted to close loopholes to avoid U.S.-style super PACs, where money flows in from unaccountable third parties.

On some of these objectives, this bill is a massive success. A clear donation limit and new rules about who can donate are some of the most important changes that could have taken place. Others were taken up in legislation previously, including a bill in 2016 by the former government that introduced new spending limits for local elections.

One area I still want to better understand in committee is the disclosure regime that this bill establishes and how we are ensuring maximum transparency. However, I come back to the fact that this government had to move quickly to introduce legislation if changes were to be made before the 2018 election, a move I want to support in the strongest possible terms. Thank you, Minister, for taking a bold step forward.

I hope the minister is open to considering this to be only a first step in local government reforms. The 2018 election will be an excellent opportunity to see what worked and what didn’t. I hope this House takes the opportunity following the 2018 local government elections to reflect on the outcomes, to bring forward additional changes, as needed, to complete the positive work that we have begun on this issue.

I hope that the UBCM would be an active partner in this process, gathering its membership’s feedback and helping the provincial government to continue to update our local election financing laws. I believe today that we send a strong message to local government officials that their important work at the UBCM is not in vain, that their collaboration, their spirit of innovation and creativity is not going to be ignored and that, as Ron and I came to understand, our province is far better off when the provincial and local governments are working together. HÍSW̱ḴE. Thank you.

[6:00 p.m.]

D. Barnett: As I rise today to speak on Bill 15, the Local Elections Campaign Financing Amendment Act, I would like to tell the House that I come from the wild west called the Cariboo-Chilcotin, where I spent 17 years as mayor of a local rural community. Financing is not an issue in our small rural communities. Most of us don’t even get donations. The most I ever spent on an election was $800 out of my own pocket.

Interjection.

D. Barnett: Yeah, but I was in a different era, where the dollar was higher.

In rural communities, to people that run for local elections, it is not a huge issue, believe you me. I can say that being in local government is a real, real privilege. You accomplish things. You don’t have badgering. You have consensus, you work together, and you collaborate well. I can honestly say that UBCM is a good institution, also, while we’re talking about UBCM.

But there’s one thing that is forgotten in this whole bill and this process — the public. The public out there in the urban centres, I believe, are the reason this bill is here, not because of small-town rural British Columbia, believe you me.

This proposed legislation, of course, follows a similar bill, Bill 3, the Election Amendment Act. The themes of those two bills are similar, albeit they apply to two different levels of government. Like Bill 3, this bill before us seeks to change the way we finance election campaigns in our province. The bill proposes banning union and corporate donations, as well as introducing contribution limits for individual donors. It will also prohibit individuals who are not B.C. residents from donating — which, I have read over the years, in some of our urban centres are large donations.

British Columbians have asked for change, and those British Columbians usually are local politicians. I have been around for a long time, and I’ve never had a constituent come to me and ask for change in financing of local governments.

If passed, this bill will help to level the playing field for candidates, and by doing so, hopefully, will help to make local politics more accessible to those who are not currently involved but wish to be.

As I said before, as a former mayor of 100 Mile House, I know firsthand the direct impact that local politicians make and the value of serving your community through local politics. I always encourage those who want to get involved to do so.

I’m glad to see the minister is here, because there are many other issues with the Local Government Act that I would hope we could discuss in the future. From this standpoint, this bill is positive for the future of our communities and our system of government and will, hopefully, help ensure we continue to have fresh ideas and fresh perspectives represented.

The changes proposed in this bill will not be retroactive, unlike the provincial bill, but these changes will take effect in time for the 2018 general local elections. They will apply to all local government elections in B.C., including municipal, regional districts, school boards and park boards.

While the two pieces of campaign financing legislation we’re examining in this House, Bill 3 and Bill 15, are similar in a lot of ways — indeed, the Minister of Municipal Affairs noted this in her introduction — I can’t help but notice one key difference. While at the provincial level the government introduced a taxpayer subsidy to replace the revenues that would be lost from corporate and union donors, there is no such stipulation in the equivalent local bill. Given the government’s argument in favour of this principle at the provincial level, I find it interesting that the same logic did not apply at the local level.

[6:05 p.m.]

The minister did address this disparity, quoting that the bills contain “some differences to account for the unique nature of local election campaign financing issues.” Therefore, the provincial bill contains public financing while the local version does not.

The minister makes the argument that because there is not currently any type of public financing at the local level, there isn’t a need for a taxpayer subsidy. But there’s no per-vote subsidy currently at the provincial level, and its introduction would be a remarkable shift. Direct per-vote financing is in no way on the same level as income tax cuts that are currently in place at the provincial level.

Don’t get me wrong. I don’t believe the public should be subsidizing election campaigns, and I am happy that there is no such proposal at the local level. But I can’t help but further question the motives behind the government introducing a taxpayer subsidy in the first place. I know members on this side of the House have questioned whether this subsidy was perhaps introduced with self-interest rather than public policy in mind. I have to say the fact that the bill before us here today contains no mention of a per-vote subsidy does nothing to quell these suspicions. I sincerely hope the government will reconsider the notion of a taxpayer subsidy at all.

Now, while I do support the substance of the bill before us today, it is also important that we hold this bill to the same level of scrutiny that we would with any other proposed piece of government legislation and ensure we are taking a close look at it so as to avoid any unintended consequences that are not in the spirit of this legislation.

There are a couple of potential consequences that I can see in this bill where I would like to raise a word of caution. This bill proposes limiting individual donations, capping the amount a person is able to donate to a campaign at $1,200 per person, per campaign, and capping loans from individuals at $1,200 as well, but with the expectation of repayment.

This limit may restrict candidates from self-financing their own campaigns over and above $1,200 when they would otherwise wish to do so. If the purpose of this bill is to remove any perception of undue influence, I’m not sure that a donation cap is applicable to this scenario. There is also no donation list for third-party organizations, which I think we should approach carefully and ensure this cannot be exploited.

But once again, despite a few words of caution, I think this is overall a good piece of legislation. The actions that it proposes are supported by members of the Union of B.C. Municipalities, local elected officials who make up half of this financing equation. The other half of the equation, the B.C. public, has also made it clear they want to see changes in the way campaign financing is done in this province. But I have not seen any public consultation, particularly in rural British Columbia.

This is good policy when policy is asked for and supported by those it affects. I would, however, as I’ve said before, like to see some public consultation. When government talks about making changes to our democracy, modernizing the way we do things, these are the kinds of changes we should be looking for — changes that come from all British Columbians, not changes that come from the top down.

British Columbians wanted to ban big money from politics, yes. But they certainly gave no suggestion they wanted big money replaced with their own money, particularly when there was no indication that this is what would be happening, and they were effectively blindsided by the move.

British Columbians didn’t ask for changes to our Constitution Act, reducing the threshold for party status from four members to two.

British Columbians didn’t ask for yet another referendum on proportional representation, the third in just over a decade. British Columbians have twice rejected proportional representation. It’s now government’s job to listen. This isn’t what the public has in mind when we talk about modernizing our democracy, as the government puts it.

[6:10 p.m.]

Where campaign financing is concerned, British Columbians did say they wanted to see changes. I support the government in helping to make these changes and helping to strengthen our system of local government — with a word of caution: we must talk to the public.

P. Milobar: Mr. Speaker, just to let you know off the top, I am our designated speaker, but I’ll be more than happy to wrap things up as the other House comes back to report progress on estimates.

Deputy Speaker: Carry on.

P. Milobar: Thank you, Mr. Speaker. It’s my privilege to stand here and speak in response to Bill 15, the Elections Campaign Financing Amendment Act. It’s an act that I think we hear a fair amount of support for from both sides of the House already, and I think it’s an act that, in its spirit and its tone, is headed in the right direction. As we have heard already from members on our side, though, there are a few concerns that I think, hopefully, we can address as we get into committee stage and move forward to make sure that the spirit and the intent, which I think we all agree with, fully gets captured and gets no unintended consequences of making local elections more difficult for people in smaller areas.

Myself, I have run in five municipal campaigns. I started in 2002, when I ran my first municipal campaign. It was myself and my large campaign team of, essentially, my wife. We strung together a few dollars, and we self-financed that campaign. Back in 2002 I think it was around $3,000, $3,100. And, you know, it was nice to not have to rely at the local level on trying to elicit donations and be able to say to people: “No, it’s okay. We want to try this.”

It’s always a bit nerve-racking, especially going into local government without a team and a machine behind you like you might see with provincial or federal political parties. So it was nice to have that latitude and that flexibility to be able to take a bit of a risk, take a bit of a gamble but not feel like you had got donations from people and put that extra level of expectation and pressure on yourself, feeling like you might let them down because they financially supported you and you weren’t successful in your election campaign.

I, fortunately, have been able to be successful in all five of my municipal campaigns, but nevertheless, that pressure is always there every time. And so that’s why I think it’s sections of this bill that do lead to a little bit of worry around how, in practice, this will work.

When you look at those campaigns, the smaller-scale campaigns, there’s no doubt that people are a little bit nervous. You see it every time. They get very excited. The media puts your name out in the paper, and you’re on social media nowadays right away, and there are a lot of news stories, and you think this is going to be pretty easy. The crowdfunding pages come up, and people think: “This is going to be great. This is going to be wonderful. I’m getting all this great feedback that I’ve decided to run locally. So the donations should flow in. People will give me $20 or $50, and everything will be great.”

Then, unfortunately, what happens in most cases, the media…. Someone else announces they’re running the next day, and from there, all of a sudden, your media attention kind of disappears. You can see it through the various elections. I’ve witnessed it several times in our elections in Kamloops for city council. There are typically 25 to 30 people running as councillors. So you see these stages of what happens when you’re running for office. It’s very hard to compete for media time. It’s very hard to get anything you say in an election forum printed in the paper or clipped on a radio newscast.

So you see the people suddenly feel almost — not totally demoralized, but it’s a change where they realize: “Okay, I’m not yesterday’s news anymore, because there’s somebody new that just announced.” So all of a sudden, they realize that it’s a lot harder to fundraise than they might have expected.

The problem with that is that then they start to rely on trying to self-finance their campaign. The reason, I think, partly, that it’s very tough when you’re trying to fundraise on a municipal level is that as you’re seeking those donations, unlike provincially and unlike federally, there is no tax receipt coming back to that person that donates their money to you. Be it through their own personal bank accounts, they entrust with you their donation to go and do good for your community.

[6:15 p.m.]

That’s a wonderful thing. It’s a very pure thing. But it does make fundraising that much harder when people don’t have that tax receipt to receive on the back end of that donation. As a result, we don’t see, outside of large Metro areas, huge donations of dollars to campaigns.

So I fully support the spirit and the intent. I think that we do need to work on this, and I think we do need to address that. I think, collectively, as we have heard from previous speakers, there are a lot of former municipal politicians in this House. That way, we’ll be able to find that sweet spot.

When you look at the Election Act amendments that were brought in by the previous government…. I, after having several different election campaigns under different rules municipally, ran in that last election, where some of the new rules were enacted and in place, specifically around some of the reporting and how Elections B.C. tracks. I think that was a good thing.

It was a big shift, and there was a lot of worry with people running, in terms of: “Would I make an honest error that would suddenly disqualify me from office?” That was a big concern for a lot of people running in local elections, because they want to be honest, they want to be forthright, and they want to make sure they’re doing things right. They don’t want to be put in a position of feeling like they’re playing a slight game when it comes to things as serious as election financing and donation limits and reporting of expenses and revenues coming in.

When Elections B.C. did the more comprehensive follow-up after the last election…. In fact, I had paid $10 to a fellow candidate, who had arranged for a debate at a local seniors centre. She was a former council colleague as well. It was $10 to participate, and that would cover the cost of the room.

Her sister was collecting the money. I said: “Well, here, just hang on the $20. I’m sure there’s going to be another candidate coming that probably forgot and doesn’t have the money. I don’t want you to be stuck with paying extra out of your own pockets, seeing as you have organized everything.” Totally slipping my mind and forgetting….

Elections B.C., doing their due diligence, had followed-up and cross-referenced, because that $20 had been denoted on the organizer’s campaign expense and contribution forms. They phoned, and they double-checked with my finance person. As I was running for mayor, I had a larger team. We corrected the paperwork to make sure that it was accounted for and that $20 error was accounted for. It was an honest error, and it was corrected. Elections B.C. was very good to work with.

It’s those types of small errors that can happen that I don’t think is the spirit and the intent of what the minister is trying to correct with this bill. I think, rightfully so, that the minister is making sure that big dollars in local campaigns do not continue to influence what we see in the Lower Mainland.

I think what we’re witnessing is a bill that is bringing a sledgehammer to a fly of a problem in areas outside of Metro Vancouver and, potentially, the CRD area and still using that same tool — rightfully so in those larger centres, where there are much larger dollars at play, much larger populations, more expensive campaigns due to expensive media and outreach initiatives. That’s totally understandable.

When I look at the previous work that was brought in and the new expense limits that will be coming in, there’s a recognition within that work that there’s a scalability to it in terms of the size of municipality you’re in or regional district you’re in, electoral area or district that you’re trying to represent, in terms of how much you can spend, how it’s calculated. I think that’s a good thing. I think we’re even already hearing that being reflected in some of this in terms of elector organizations and percentages and those types for third-party advertising.

But that needs to carry forward and be reworked so that people that are self-financing their campaigns can do so without fear that someone is going to overly scrutinize the paperwork and find some loophole and trigger by-elections or make it seem like a school trustee or a mayor or a councillor was trying to play fast and loose with the rules.

The reason I say that is with a $1,200 personal limit, it would be impossible. As I say, when I ran in 2002, I ran a very lean city council campaign. That was still $3,000, $3,500, somewhere in that neighbourhood. That was 15 years ago, so imagine if my personal limit was $1,200.

[6:20 p.m.]

Technically, back in 2002, my kids were all under 18. So technically, I guess, under these rules, I could write a cheque in their names and give it back to myself and collect another $1,200 times three. I don’t think that’s what the minister was intending at all, but that’s the scenario that could be created with this, where people are technically following the letter of the law but not the spirit of the law. It has hamstrung their ability.

My kids are all older now. They’re 19 and above. You wouldn’t even have that kind of latitude, I guess, to play fast and loose with the rules, because they’re not dependent children anymore. But that’s the type of scenario I’m talking about.

I think people running at the local level truly want to make sure they’re following the rules, but we have to make sure the rules are structured in such a way that it allows them to easily follow those rules and to be aboveboard with everything and not find creative ways to try to circumvent the rules, which are there for a very good purpose and very good reasons.

In terms of a $1,200 donation limit per person per candidate, that’s…. I don’t have a big issue with that as a limit. I think most people, outside of Metro and other areas, would be very hard pressed to find people, with the lack of a tax receipt, to donate more than $1,200 to a municipal campaign, frankly. However, there’s still that gap piece with the personal contribution to your own campaign that is problematic.

It does create, as I say, the ability for people who would be technically following the letter of the law, as it’s written, if you had a larger family, to be able to finance, to a much higher level, out of essentially, still, the same bank account. But if you were somebody that lived alone and had older kids and didn’t have a large extended family in your area…. You may have a huge network of friends. You’re totally electable. You could probably top the polls. But all of those people would be subject to the $1,200 limit.

You would have to actually go start asking all of those people for donations, when in the past, you may have just self-financed your own campaign. To be your own “person” is what you always hear when people say: “I didn’t take any donations. I didn’t want to be beholden to anybody.” That’s where I think we need to look at this piece specifically.

As I say, my experience in the five municipal campaigns I’ve run in…. The different levels are also very different. I ran twice as a city councillor. The second time I ran I was able to still be in that $3,000 range, and that would have been 2005. I reused my signage. I was able to maximize a few things from lessons learned from the first election.

Even though it was three years later and rates had changed slightly, I was able to still be able to construct a campaign in that $3,000-to-$3,500 range, if memory serves correctly. Making sure that you were showing a serious effort to get elected in a city the size of Kamloops, to the voting public, not taking things for granted but trying to move forward in a cost-effective way and still minimize those donation asks.

Then, in 2008, when I ran for mayor for the first time…. That changes things, when you’re in a city the size of Kamloops. It dramatically changes if you’re down in Surrey or Vancouver, and I recognize that. I think those are the dollar-level campaigns, especially down in the other areas, where you start to see the big-money donations really come into play. Even at that, even in Kamloops…. And it’s all been publicly disclosed. Anyone can look this up on line. Even at that, every time I ran for mayor, I was able to fundraise. Sometimes there were significant donations, $4,000 and $5,000 donations, from individuals or companies.

A mayor’s campaign in Kamloops runs anywhere from…. To run a serious campaign, you’re anywhere from $30,000 to $50,000. That’s not unusual. That’s not spending at will. That’s just trying to cover a large geographic area with signage. Advertising is expensive in Kamloops, as it is in the Lower Mainland, even more so in the Lower Mainland. That’s the reality of trying to mount a campaign.

[6:25 p.m.]

I think, at the mayor level, you probably could find those extra people to donate at the $1,200 limit and still be somewhat able to mount a campaign without significant personal dollars going in. Again, there are other people that run for mayor in a city the size of Kamloops or that would run in much smaller centres, like a Barriere or a Chase or a Clearwater, who would want to just self-finance. And $1,200 does not go very far if that has now, almost de facto, become their spending cap as well as their self-donation cap because that’s what we’ve limited them to. That’s really at the crux of where some of the problems that I have with this bill are.

The second time I ran for mayor, the same thing kind of happened. In fact, I was three hours away from acclimation. We had put everything on hold. I didn’t want to just spend money for the sake of spending money and start campaigning ahead of knowing if there were even other candidates or not. There were other candidates.

Frankly, I came very close to not being successful in that election, because people again felt that…. The number one thing I heard was they felt I was taking it for granted, as an incumbent, when in fact what I was trying to do was to be fiscally prudent and not spend money for the sake of spending money. That still required fundraising, so that campaign was a little bit cheaper because we started a little bit late. It was literally the last day of the campaign when we knew we even had a campaign. It was a very short campaign.

Again, the $1,200 probably wouldn’t have been a big problem per person, but any personal top-up funds that a candidate may find themselves in…. You could lay out the best campaign idea in the world, but if you’re hoping to maybe generate donations as the campaign is going on, it’s pretty tough to start placing ads if you know the only money you know for sure you have to spend is $1,200. Even if you have an extra few thousand dollars of your personal money that you would like to put towards that campaign, under this bill, you would not be able to do that.

I want to stress this: the fundamentals of this bill are totally supportable. I have no problem with the ideal and the intent of what this bill is trying to accomplish. I’ve absolutely no problem. I think that, especially when we look at what happens in Metro Vancouver, in Surrey, in the Burnabys of the world…. Those large centres definitely need to make sure that we are really clamping down and really making sure where those big-dollar campaigns are happening. That’s where we need to focus.

It’s not like a provincial or a federal realm. If somebody is impaired from donating large sums of money in Vancouver, they are not going to suddenly seek out the candidate in Cranbrook that’s running for mayor and say: “I wasn’t able to donate $50,000 in Vancouver, so I’m going to donate $50,000 to a candidate in Cranbrook.” That’s not how municipal government works.

The people that would want to put money into a certain campaign at a local level, local being the key…. They are targeting local areas for a reason. Either they’re developers, or they’re business people or union members within those areas. They want to see a certain person elected for that town, for that city, for that village, and that’s really the key to this.

I think there is a way that the collective brain power of this House — with all of the past experience of people that have been in local government and have run in local elections, coupled with a lot of the legal expertise of minds in this House as well — should be able to come up with a way that we can recognize that there are some differences between the two areas of the province in terms of where the large donations are.

That’s not to say that we can’t always amend this if there are still problems and the money does suddenly flood out of the Lower Mainland into far-flung areas of the province. But I would find that very hard to believe, because if it’s not there already, I don’t see why people would have this itching desire to go and spend a $50,000 donation, without a tax receipt, in a different area of the province that they’ve previously never paid attention to or worried about the local politics of that area.

I think there’s a way to address the personal spending limit without degrading that $1,200 personal limit for people that aren’t running for office and to make sure that there is truly a level playing field out in the communities for the people that are trying to do the right thing. They’re running for school board because they want to make their towns better. They’re running for town council, they’re running for mayor, because they want to make their towns a better place to live.

[6:30 p.m.]

You think about the sheer number. I think it’s…. What are we at? We’re close to about 1,000 people, in total, that have ever been MLAs. I think in the last election…. I remember looking at a stat at a previous debate. In the last municipal election, we had almost 3,400 people running for municipal council. In the last provincial election, I think we had about 376 people running to become an MLA. So there’s much more interest from people.

Not everyone is looking to become an MLA or an MP when they run for office locally. They’re just trying to do their best for their community, they’re trying to do their best for their family, and they’re trying to do it in a very honest fashion. I think the intent of trying to make sure that they can follow the rules easily is very good. I think the intent of getting the big money out of local elections is absolutely supportable.

However, telling somebody that their own personal expenditure in an election on their own personal campaign — I don’t think that was the original spirit and the intent that the minister intended with this legislation. I think that we have an opportunity here, as it goes into committee stage, to make sure that we’re addressing that and catch that ahead of time, instead of making an error that makes it almost impossible for properly run elections in outlying areas — outside of the metro areas of this province.

That’s, ultimately, the worry I have with this. If you put a personal donation cap for a candidate at $1,200, and you turn around and enshrine that for the next municipal election, once the realization that that actually was in error — it’s too late. The election is underway. We will find, in a level of government that already has chronically low voter turnouts….

As I referenced before, ten times as many people run municipally as run provincially, yet we get half the voter turnout municipally that we get provincially. It’s not that people don’t care about local politics. I can assure you they do. I got many more emails a day as a mayor than I do as an MLA. People do care about their local politics, but for whatever reason, it gets a little bit tougher to get out and vote that day. Even though there are ten times as many people going around asking their friends and families and neighbours to try to come out and support them at the polls, we still get half as many people to show up and vote.

If you look at the historical donation numbers, which are all available on line from Elections B.C. from previous elections, there just simply are not the dollars in municipal campaigns, outside of the Metro area, to create the same level of worry around people self-financing their own campaign.

If someone chooses to…. If we figure out a way to raise the level that someone could fund out of their own personal funds, and that person still chooses to try to find a creative way around that, well, then I think we need to have very firm penalties in there. The removal of office and those types of things need to be acted upon, because at that point, we’ve tried to be as fair as possible. We’ve tried to make sure that people can actually run a proper campaign, a campaign that would alert the public that there’s even an election going on, and still give them the ability to self-fund that campaign without feeling like they’re breaking the rules, without feeling like they have to be creative.

That would, I think, really encompass the spirit and the intent of what the minister is looking for. As I say, I have absolutely no problem with trying to ban big money donations from local elections, none whatsoever. I think that’s the right thing to be going towards and doing.

My big concern, having run in five municipal elections, knowing intricately how they tend to be financed and how hard it is to fundraise — the small dollars, in the grand scheme of things, that are generally involved in most campaigns — is it would be very punitive if you were essentially saying to people: “Unless you’re prepared to go out and start fundraising, you can only spend $1,200 on a local campaign.” That’s what this bill says right now.

If you’re in a city the size of Vernon, more of a mid-size city, or a Cranbrook, that’s impossible. There’s no way that you could run a campaign for $1,200 in a serious fashion, either for councillor or for mayor. Now, there are always people that spend $300 or $400, but I would suggest, if you look at where they finish in the polls…. It’s not a case of trying to buy your way into a seat. It’s a case of trying to make sure you have enough money to properly advertise to inform people what you’re running for, what you’re standing for, what your ideals are and what you feel the public would benefit by electing you to be in that seat. All of those types of scenarios need to play out.

[6:35 p.m.]

[Mr. Speaker in the chair.]

There is the occasional person that runs and spends very, very little and gets elected. I had a colleague that did that. He topped the polls every time. I think he owned three wooden signs. He’d paint and reuse them every single time. He topped the polls every time he ran for school trustee. He topped the polls every time he ran for city council. I think he was on both, between the two of them, for about 20 years. So there are some people that can get away with spending next to nothing and still do very, very well at the polls, but those people are the exception, not the rule.

The problem is all around this personal limit. I think that if there was a recanvass of the UBCM membership through a simple email distribution that UBCM themselves would send out, making sure that their members could provide quick feedback…. I agree that we need to have this in place for the next election. You just don’t want to rush it or delay it to the point that that can’t happen. But even if there was a quick reach out through UBCM’s redistribution network…. I know they have it. They hit send, and it goes to every municipally elected official in the province.

I think that if they knew and it highlighted specifically that they understood their personal expenditure limit of donation to their own campaign was at $1,200, it would actually be a very quick and easy way for the minister to just double-check with UBCM that they truly understand that clause and they’re comfortable with it. That’s really the fundamental clause piece that I think is problematic. It’s the one that I think we need to seriously look at and address.

I recognize the other areas around third-party advertising. Those calculations get to be very complicated, and I support that we need to do something there. So whether those are 100 percent right or wrong, worst case is that a special interest group doesn’t get to try to spend a bunch of extra money.

I’m more concerned about the actual local candidate, boots-on-the-ground candidate, and making sure they have the ability to run a very honest, very open, upfront and transparent campaign and not unnecessarily tying their hands while still figuring out a way to ban the big money, which we do want to ban, especially out of the large cities. That’s where we’re seeing it. We have tons and tons in track records around that. That’s really the key to all of this.

I know that I’ve talked to a few local elected officials that I’m former colleagues with. They have concerns around this. That’s not to say…. Even the last time, when the new legislation was brought in, there was a lot of apprehension by local government officials, as I mentioned, in terms of: “Am I following the rules?”

What happens when the candidate…? In Kamloops’s case, there are eight council seats. The big worry was: “Okay, what happens if I accidentally don’t follow every single rule to the letter, even though I was trying my best to do it, and the ninth-place person decided to mount some big challenge and I automatically get tossed from office?” Now, that didn’t happen, because there’s a recognition within the act that…. That’s why Elections B.C. does a very thorough and professional job of following up and catching those small errors, those small tweaks.

As I say, I had a $20 omission on my form that I had no idea I needed to declare. We cleaned up the paperwork. It was absolutely no problem. But that’s the type of uncertainty or worry that gets created around council and regional district tables. So that’s the type of thing that I think we have the opportunity, with this bill, to make sure that we catch the first time.

The worst-case scenario is that right now there’s no limit. If we enact a limit that your personal campaign funding can only be X and we find out after this next election that it was a little too high, there was still a limit at least. Right now there’s no limit at all.

I would suggest that it would be much easier to ratchet that limit down after the next municipal election, after some real-world experience with how it all played out, than start it so low that we’ve already hamstrung people from doing the right and honest thing with their own campaigns, making sure that they can run well-publicized, well-articulated campaigns to make sure that the public know who they’re voting for.

We always hear about the power of incumbency. A lot of that power of incumbency is, I think, not just name recognition; it’s because the public feel comfortable because they know what that person stands for. A lot of times, if you don’t get re-elected and you’re an incumbent, if you look at your voting record, there are a lot of times that local governments…. Your thought process has been all over the map, and — this is my own personal belief — the public don’t feel that they get a true sense of who you really are, whereas when you’re very consistent, even if the public doesn’t agree with every piece of your ideology and every thought process that you go through, they know what they’re getting.

[6:40 p.m.]

If you’re a brand-new candidate, that’s a very hard thing to try to impart to people, especially if your personal spending limit is $1,200. You want to be able to let those non-incumbent council candidates and mayor candidates have the ability — and it does cost money to do — to articulate out to the broader public they’re trying to appeal to so that people can make an informed vote. They can insert people in.

Typically, in most regional districts, you have about a one-third changeover of the board every election. Municipal councils are similar; it’s about one-third. You want people who are making those choices on those one-third of brand-new faces that they’re going to have for four years — ruling how the water gets distributed and how many roads get paved and potholes and all of that stuff they rely on, on a daily basis — to have a very clear sense of who they’re electing and who they’re voting for. But that does take funds.

I totally support banning the big donations coming out of this. But the reality is that in the smaller centres, it’s not the big donations we need to worry about. How do we not jeopardize those smaller areas having that ability to reach out to their community, better inform their own people, make sure everyone knows what they’re voting for and try to make sure that we don’t degrade even further the voter turnout for municipal elections? Because it’s at about 33 percent right now.

It’s chronically low. It’s horribly low. It’s an embarrassment. But reducing the amount of advertising that candidates can do so that the busy public has even less opportunity to understand there’s even an election going on — that actually is counterproductive to try to make sure we have well-attended elections.

There’s obviously a big interest. As I said, we had almost 3,700 people or 3,400 people run in the last municipal election — ten times who ran for the provincial election. So there’s a lot of interest out there from a lot of people that want to step up and do good for their community, but they need that ability.

I really do hope that, as we move through with this bill and as we get into committee stage, we can try to do that quick reach out to UBCM and see if they can’t do a quick distribution to their membership and really make sure that they understand. Just from the amount of members that I know at UBCM and having been elected for 15 years as a municipal councillor and a mayor, you get to know a lot of people.

As we heard from the member earlier, when you go to UBCM, it’s like Old Home Week this year. You realize just how many people you know from across this province, from the various committees and boards and commissions and conferences you go to. And I can assure you that, knowing most of them as I do, I think they would have real concerns if they were told that you can’t personally finance your campaign for more than $1,200.

I’m sure if the research was done…. I’m not sure how much research the government put into this on the back side with Elections B.C. filings, but I’m willing to bet that outside of the metro areas, the vast majority of municipal campaigns for council have been self-funded, when you look at what they have for donations. Probably almost all of them will have next to nobody donating for them, and it’s all personal funds. If the vast majority of those campaigns are run in the $3,000-to-$5,000 range and the vast majority of those are all run by self-financed campaigns, a $1,200 limit instantly creates a problem. It flat-out instantly creates a problem.

All of the data is there. It’s all available. It’s readily available. One would hope that we would have some government researchers looking into this to come up with what that average spend is in these smaller areas outside of Metro Vancouver.

Metro Vancouver has the party system. There’s not a party system where I come from. Everyone is an independent. Everyone runs on their own. There is no party structure. So I totally support and understand why we would want to make sure that parties like Vision and NPA are held to a standard as a provincial party would be as well, That I totally get. That is, to me, the overriding concern. That’s the overriding problem.

I do note the hour, though. I can continue, if the Speaker would wish, or I can not. I’m not sure what the Speaker would prefer.

[6:45 p.m.]

Point of Order

M. de Jong: Just on a point of order. I am advised that a comment I made during the course of question period has caused the minister of state for daycare some distress. That was certainly not my intention, and to the extent that it has caused her distress, I want to withdraw and apologize to her.

Debate Continued

Mr. Speaker: Seeing no other speakers, Minister, closing debate.

Hon. S. Robinson: I certainly took great pleasure in listening to what my colleagues had to say about this bill. I want to thank the Minister of Mental Health and Addictions, the members for Kamloops–South Thompson and Saanich North and the Islands, the member for Cariboo-Chilcotin and the member for Kamloops–North Thompson for their thoughtful comments on this bill.

I want to assure everyone in this House that the UBCM has been consulted and is very excited to support this bill. They certainly recognize, as do most British Columbians, that it is time to get big money out of all of our politics. I would just like to remind everyone that while we have a very low voter turnout for local elections, part of that low voter turnout is that people no longer believe that they have democracy — that it’s money that influences.

While people seem to think it’s only in larger cities that we have big money influencing, there are examples all across this province where, in small communities, the corporate and union donations have had significant impact.

I look forward to getting this bill into committee stage and making sure that it passes so that British Columbians going forward know that in October 2018, they have their democracy back.

With that, I move second reading.

[6:50 p.m.]

Mr. Speaker: Members, if you could please take your seats to facilitate the division.

Second reading of Bill 15 approved unanimously on a division. [See Votes and Proceedings.]

Hon. S. Robinson: I move that the bill be referred to a Committee of the Whole House to be considered at the next sitting of the House after today.

Bill 15, Local Elections Campaign Financing Amendment Act, 2017, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

Committee of Supply (Section A), having reported resolution, was granted leave to sit again.

Hon. M. Farnworth moved adjournment of the House.

Motion approved.

Mr. Speaker: This House stands adjourned until 10 a.m. tomorrow morning.

The House adjourned at 6:55 p.m.