Fisheries Committee on May 13th, 2008

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

Thank you, Mr. Chairman.

I listened to all your explanations, and there were a lot of them. I'm going to say good morning and welcome to the committee.

Tell me if I've understood. You've reached an agreement with the Department of Fisheries and Oceans for the divestiture of the port concerned. If I understand correctly, around that port, you intend to create an additional holiday resort that will attract tourists. When you started work on the wharf, you discovered problems. I don't want to accuse the government, Fisheries and Oceans, or the municipality of bad faith in the negotiations. Let's say there are unforeseen circumstances.

You invested only $3.6 million for the unforeseen circumstances that arose. Does that $3.6 million come from the $15 million that you obtained, and is it therefore subtracted from the $15 million? If that's the case, I don't know whether you've approached the department—I'm going to tell you all this in one shot, and then you'll answer me—to obtain assistance to address those circumstances. Earlier I listened to the mayor, who said they wanted to retain... I think that keeping the tourists for a few more days is the idea of the entire municipality or of the entire county. We know that's good for all the businesses, the hotel industry and so on. We see that a bed tax is charged in a number of places, a fixed amount of $2 in addition to the price of a hotel room, which goes to the municipality for development. I believe Ontarians have been aware of this way of doing things for a long time. I believe Quebec has copied Ontario. The fact remains that, eventually, you'll definitely feel an impact.

Have you calculated that in the administration of the port as such? You have additional infrastructure. Is the shore infrastructure calculated in the $15 million, or is that only for the transfer of the wharf?

[Steve Hyndman]

Perhaps I'll try to answer, and Marjorie can assist as need be.

To confirm the first question, the $3.1 million that's been spent does come out of the $15 million. That's not an extra on top. The MIII moneys that come from the province are on top of the $15 million, but of course that's not part of the agreement between DFO and the city.

Have we asked DFO for additional assistance? In a formal way, no. In an informal way, we have made it clear that we are facing some challenges. So we've spoken to staff and we've spoken to Mr. Kramp about this. In an indirect way, yes, we have expressed those concerns, but there has not been a formal request or a formal application, if you will, that's been put forward. We'd certainly welcome the opportunity, presented by our appearance today, to perhaps make that concern somewhat more formally.

In terms of tourism, yes, we do see this as an opportunity for us to grow our economy. With the county and the city participating in this, we do believe there is opportunity for growth, and the harbour is a very important part of that future. On the idea of the city realizing some benefits from that, indeed, we would certainly hope that would be the case.

We do recognize that oftentimes jobs created through the tourism industry are seasonal. They're not quite the same in terms of income and they don't have quite the same long-term economic impact as, say, a full-time manufacturing job. We'd have to take that into account, not that we still don't want to pursue it. That is a factor certainly that we're very well aware of.

We haven't done any formal long-term economic impact assessments with regard to this. There's no question that the benefit of harbour divestiture, of harbour development in terms of the city's long-term prospects for tourism, was a factor that helped council make the decision to, if you will, take the risk and move ahead with the program, because they do see those benefits. We haven't quantified those impacts in any formal way.

I hope that answers your question.

[The Chair, Conservative, Fabian Manning]

Thank you, Mr. Lévesque.

Mr. Stoffer.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Thank you very much.

I admit I'm very pleasantly surprised that a council would want to keep something in the public hands. It is sort of like a good New Democratic, social democratic type of thing to do. I'm glad to see that your chamber of commerce supports that, because where I come from, most chambers of commerce are strictly there for the private sector and not necessarily for a municipal council. So I'm very pleased to hear that.

Have you done a survey or an estimate of how many boats you anticipate would use the pier or the harbour on a regular basis? From that, have you done an estimate of how much revenue you would be able to generate just from recreational boating itself?

[Marjorie Buck]

In regard to the change in our operations, I'm actually very pleased to advise the committee that Meyers Pier in Victoria Harbour right now is at approximately 80% capacity.

So anticipating that we can just take that extra little step and have a full operation, we are looking at, from our seasonal boaters, an approximate revenue of $150,000 per year.

If we have the opportunity to advance in regard to our commercial development on the pier itself and make that an attraction.... What we are hearing from our boaters who pass us by and go down to Cobourg, which is another outstanding harbour that the municipality is involved with, is that our amenities are lacking. We need to look at our infrastructure for wireless communication for boaters who take their work on vacation or who just want to be in touch with their family.

From our transient boaters, we average about $35,000 a year in revenue. Our fuel sales range anywhere from $120,000 to $141,000 a year. Regarding improvements, which are covered under this contract coming up, we are changing our fuel system, which should enhance it.

We are competing against our neighbours to the west, Quinte West, which is the entrance to our Trent-Severn system, and again, if our boaters are doing the Trent-Severn system, they'll go by and they'll fuel up at the Fraser docks.

If we had the extra amenities, I think they would stay and look at it. We're projecting that with some investments, commercially as well as to infrastructure for the actual boater, we should get up to at least a 90% to 95% factor.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

So at the end of the day, when all is said and done, the hope is that this won't cost the taxpayer money, and if anything, it could be revenue neutral.

[Marjorie Buck]

That's our focus and our direction. When it comes to our existing budget, right now, for instance, our city taxpayers are subsidizing that site at $49,000 a year, but out of that $49,000 there is an annual payment to the federal government--not that we begrudge that at all--of $38,000. So that subsidy right off the bat will be reduced, because your share of the revenues will remain in the City of Belleville.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Very good. Excuse my ignorance on the following question.

Is there any first nation component to this development? Are there any commercial fishers, any land concerns, any rights issues in that particular regard?

[Marjorie Buck]

No, there is not, at either Victoria Park or at Meyers Pier. There is a plan that is dated 1838 on that particular site. I forget the proper name for it, but it was from 1838, and it was well established. Actually Victoria Harbour was part of the harbour commission back in the 1800s.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

I wish you the very best of luck in your future plans. All the best.

[The Chair, Conservative, Fabian Manning]

Thank you, Mr. Stoffer.

Mr. Calkins.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

Thank you, Mr. Chair.

It certainly is a pleasure to be here in Daryl's riding. He speaks very highly of the people who support him and who he works with here. It is certainly great to be here. I'm one of the few permanent members of the committee who is from a landlocked riding.

I actually live in Alberta, and I certainly have a keen interest in the fishery and small craft harbours. I think we have three in Alberta, from the federal government. I've been to all of them, and I'm looking forward to seeing some of the harbours you have here.

Most of my questions have already been answered. I just wonder, if you have the information, whether it is available.... The $15 million you've had to spend, I would imagine, has escalated since the process began--I think in 1994--or since we've started going down this path. Some of that is to address concerns of the Government of Ontario. Of the $15 million, how much has to be spent to address environmental concerns of the Government of Ontario?

[Steve Hyndman]

It's tough to put a number on it, but I would say certainly the majority of it. Even when you look at some of the surface materials—

[Blaine Calkins, Conservative, Wetaskiwin, AB]

How much of a majority are we talking about?

[Steve Hyndman]

I would say virtually all of it. Part of it has to do with the capping of the site. The site has to be capped for environmental reasons, so we've been able to use the process of this program to make choices as to how to do the capping, in a way that satisfies the Ministry of the Environment concerns but that also advances our work towards the long-term plan. Whether you consider that as environmental or not is subject to some debate, I suppose.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

Has your municipality ever tried to access other funds, whether it's through the Province of Ontario...? We talk about the MIII and so on, but I know there are some federal programs for federal contaminated site cleanups. Has there been any attempt to access any of that funding, or has it simply been through DFO?

[Marjorie Buck]

When we started this process, not only did we have the small craft harbours people at the table in the discussions, we also had representatives from the federal Department of the Environment. Mike MacDiarmid could probably answer this better than I, but the $10 million is funding through the small craft harbours program and Treasury Board—and I believe the Department of the Environment has money at the table—for this whole project.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

I'm going to turn it over to Daryl in a second, but I think it's quite amazing, when the small craft harbours program is spending about $1.5 million a year to divest 15 to 25 harbours, that you have about a $10 million commitment over time. For your community to get that kind of funding out of the small craft harbours program is quite exceptional, so I certainly congratulate you. You must have worked very hard to get that money.

I'll leave it to Daryl to finish my time, Mr. Chair.

[The Chair, Conservative, Fabian Manning]

You'll have a minute and a half, Mr. Kramp.

[Daryl Kramp, Conservative, Prince Edward—Hastings, ON]

Thank you. I'll get right to the point rather quickly then.

The mayor brought up what I think is a bit of a concern for all of us. If you have a pre-determined budget and know exactly what you're going to spend, then obviously you can plan accordingly, you can operate efficiently, and you can reach a desired conclusion. One of the difficulties we have, of course, is the unknown. We've had some unknowns for two reasons: this has gone on for a number of years, and of course there are changing environmental standards and changing bureaucratic rules.

The mayor mentioned the word contingency. Was there a contingency costing put on the original estimates? In other words, if you're going to build a building, you add 15% or 20% for contingency. Was there contingency built in?

[Marjorie Buck]

Yes, there was.

[Daryl Kramp, Conservative, Prince Edward—Hastings, ON]

And what percentage was it? Do you have any idea?

[Marjorie Buck]

At the time of the initial meetings in regard to entering into this whole project, we were anticipating the standard 15% as a contingency.

[Daryl Kramp, Conservative, Prince Edward—Hastings, ON]

And we sense that we have a problem and we're going to be over that, obviously.

When we have something outside the norm like this, then, when it's generally beyond a person's normal business plan, I'm wondering whether the committee would entertain some possibilities and some options to see whether there are means or mechanisms, such as a contingency fund, to deal with unusual circumstances. Is that something DFO and/or Treasury Board should consider?

I'm throwing that out for the committee's evaluation as something related to your point, because I think this is one that is a bit of an exception. It sits outside the norm, and it doesn't look as though we're adequately prepared for this down the road. We all want environmental concerns looked after and we want municipalities and the governments to share costs, and I think we have a win-win all the way through here. There's been a great working relationship, and I would like to see it able to be extended.

[The Chair, Conservative, Fabian Manning]

Thank you, Mr. Kramp, and thank you to our witnesses. It's been a different sort of discussion here this morning from what we've been used to in our travels. But it's good to get the perspective from your success to date. Once again, I thank you for your presence here this morning.

Committee members, we're going to take a five-minute break to get ready for our witnesses from the County of Prince Edward.

Thank you once again.