Industry Committee on Nov. 30th, 2009

[Chris Warkentin, Conservative, Peace River, AB]

I know that the Community Futures organizations are successful in my community. For those people who aren't familiar with what they do, they don't only provide or give counsel as it relates to loans. They also provide counsel in terms of building business plans and the rest. They're really an exceptional organization, and this is something that I think deserves a lot of credit, especially since they are community based. They really have a connection with the community, with the directors being community members. We've certainly seen the benefit of that.

I would commend the western folks for having come under common marketing under the Community Futures banner. Up until recently, there were a number of different names for every local agency, and oftentimes that confused people, but the Community Futures common branding has been successful, and I know that it has been very helpful for the general population.

I want to move to a couple of different questions on other programs. The community adjustment fund obviously is something of interest, especially to communities that have been hit hard by the downturn of their respective economies. Maybe this is a broad question to each of the agencies that actually do take responsibility for the community adjustment fund: how is the determination made on what will be funded and what will not?

I just wondered about this in terms of the ranking. Is it first and foremost the...? I mean, do you take a map and say that this is an area has been hard hit as it relates to...? For instance, in my case, we have towns that are exclusively lumber industry towns and they've been hit hard.

Do you do that first and then pull applications out of that? How exactly does that work? What's behind the scenes?

[Daniel Watson]

It's quite a rigorous process. As you can imagine, we're obviously dealing with large amounts of taxpayers' money. Not only are we dealing with large amounts of taxpayers' money, we're dealing with people's lives and economic interests and, in many cases, the lives and economic interests of communities as well. It has been a very scary time for many Canadians and many Canadian communities, and certainly our staff hear that all the time when they're dealing with these people.

There are two categories of things that we look at. In Western Economic Diversification we did a call for proposals. We got almost 1,500 on the RInC side of things and just about 1,100 on the CAF side of things. The criteria for the program are actually up on our website, so any Canadian can look at that website and see exactly what the criteria are.

I'll just run through some of them quickly, because I think they're important. First of all, for CAF, the project had to be located in rural communities with a single industry. That was one of the program criteria. It also needed to create jobs and maintain employment; in other words, if it was a great project to do something, but it wasn't really going to create or maintain much employment, that was a big knock against it.

The project needed to leverage funds from provinces, territories, or other funding partners. That was a strong preference. I mentioned in my opening remarks that in some of these things, and I think it was in RInC in particular, we leveraged a figure of $430 million from other partners that probably wouldn't otherwise have been there. It needed to build on partnership arrangements that were already in place and the reason for that was to move quickly: don't build new things in terms of relationships with other players if you don't need to, but go ahead with what's already in place. And ideally, it was to provide a longer legacy of long-term economic benefits.

Those were all criteria, but then there were some other things on top of that. First of all, what was being proposed had to be completed by March 31, 2011. If you couldn't get started until next year, for whatever set of reasons, then it didn't fit. What was being proposed needed to make sure that it provided benefits to communities affected by the global economic recession. In other words, again, it was tying this to need. Also, it needed to create immediate and short-term employment, start quickly, be incremental, and not simply replace projects that were going to go ahead otherwise.

We considered all of those things in a very vigorous due diligence process and made sure every project that was being considered met all of those criteria.

[The Chair, Conservative, Michael Chong]

Thank you very much, Mr. Warkentin and Mr. Watson.

Mr. Rafferty.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Thank you very much, Chair.

First of all, Mr. Watson, you indicated that 10% of the RInC funding is still uncommitted, if I heard you correctly.

For the other two agencies, is it also the case in your agencies that there is still uncommitted RInC money?

[Pierre Bordeleau]

Yes: uncommitted money in RInC, but very committed money for CAF.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Okay. So in each of the agencies there's... There's 10% in this case, and in the other two cases?

[Monique Collette]

In the agency, for RInC, we have roughly 55% committed, but we expect that by the end of the fiscal year, which is the end of March, we'll have 100% committed—not spent, but committed—and that it will be spent by the end of 2011.

For CAF, we have 67% of the allocation committed, and again, we expect that we should have all that committed by March. There are a lot of applications, but we still need to do the due diligence. We absolutely must have it committed by the end of March, construction season, because most of those projects involve construction.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Mr. McKenzie, is it the same for you?

[Guy McKenzie]

It's about the same. The pickup on FAC was much quicker, obviously. I explained earlier as well that because we have the legislation called Bill M-30 in Quebec, we had to go through the Province of Quebec before we were able to deal with the communautés. Because the election was at the municipal level, in election time in November obviously it took a bit longer.

For FAC, we did most of our investment in forestry, and the pickup was much faster.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Okay.

Mr. Watson talked about CAF funding in particular and about the criteria for dealing with applications. For the RInC funding in particular, I'd like to ask each of you, just very briefly, how your agency is allocating funds or how they have allocated funds for the horizontal initiative--I know that's a little bit different--for recreational infrastructure.

[Monique Collette]

For horizontal, let's take Atlantic Canada, is it something that would touch the four Atlantic provinces?

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Yes. Is there a template you use? I'm looking for sort of what Mr. Watson outlined for CAF a moment ago.

[Monique Collette]

It's not the same. You see, the amounts of money were allocated through RInC based on population only. For CAF, they were allocated based on $10 million per province plus a per capita allocation.

The way the adjustment works is that if, for example, you have something like a project that would create jobs quickly, in something such as forestry... In Atlantic Canada, we have one pan-Atlantic agreement that covers two provinces. We signed agreements with Nova Scotia and New Brunswick to plant trees. That would bring a lot of jobs, fast, to those two provinces. That was pan-Atlantic.

In RInC, it's mostly individual projects from communities, so it's difficult to—

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

How was that decided? Was there an internal template that you used to judge those applications? I'm sure you received many more applications than there was money for.

[Monique Collette]

Yes, but we all have the same criteria.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

You do? Okay.

[Monique Collette]

Yes, we do.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

They are along the lines that Mr. Watson—

[Monique Collette]

Yes, absolutely.

[Daniel Watson]

If I can just say something very quickly, under the terms and conditions of the program, it was required to be arenas, gymnasia, swimming pools, sports fields, various courts, or multi-purpose facilities. So first of all, it needed to be one of those, and again, it needed to be something that you could start very soon. It needed to be something that you had partner funding for and normally it needed to be for the rehabilitation or repair of existing infrastructure, more so than brand new construction.

Those were the criteria that we were all working under. We had to apply them much the same as we had to apply the criteria under CAF.

[John Rafferty, NDP, Thunder Bay—Rainy River, ON]

Okay. That's good.

I have a question for Mr. Saunderson.

You're one of the finance guys, so let me ask you this question. Now, the members of the committee and the witnesses may not know this, but the far west part of my riding is actually where the prairies begin. I know you don't think of northwestern Ontario as the beginning of the prairies, but the prairies do begin in the western part of my riding, so this is a question specifically about Western Development.

Keep in mind, before you answer the question, that children in the very small town of Emo--that's E-M-O, as you would expect--have tears in their eyes right now. They're crying, and I'll tell you why. They're crying because I had an application in for a water spray park that certainly fit the criteria although it's not being rehabilitated; we'll say it's a new building. This is a community of about 2,500. The community has raised $120,000. They needed $30,000 more to complete it and the application was turned down. After I talked to the minister, it was definite that there was no $30,000 coming. You'd think you'd be able to find $30,000, wouldn't you?

Anyway, my question to you is this. Because the prairies actually begin at Emo and we're really the gateway to western Canada, is it possible--because I see the transfer column--to transfer $30,000 extra dollars from your outfit to the Town of Emo? Keep in mind that every time I go there the children are crying.

[The Chair, Conservative, Michael Chong]

Thank you, Mr. Rafferty.

Mr. Saunderson, quickly.

[Jim Saunderson]

Well, technically, yes. As we've seen, it is possible to transfer through the estimates, but it would be a decision that would require the agreement of the ministers involved.

[The Chair, Conservative, Michael Chong]

Thank you very much.

Mr. Lake.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Thank you, Mr. Chair.

It doesn't surprise me to hear that Mr. Rafferty is a prairie boy with his Michael Landon haircut over there.