Good morning, honourable members. My name is Harry Nyce. I am president of the Union of B.C. Municipalities. I'm joined here today by Barbara Steele, first vice-president, from Surrey, and Gary MacIsaac, who is the executive director for UBCM.
UBCM is an advocacy organization that acts on behalf of local governments in British Columbia. Membership of UBCM is voluntary, but we are proud to say that all municipalities and regional districts in B.C. are members of UBCM.
In preparing for this submission, we were instructed to provide examples of situations facing local governments in British Columbia. We will do so, presenting several instances today.
First of all, we wish to state that the commitments made by the federal government to local government infrastructure in the 2009 budget were substantive and welcomed by the communities of British Columbia. The stimulus funding programs are proving to be successful. For many years, local governments have made the case that there is a need for all governments to work together to renew and expand community infrastructure. We believe there are some localized issues with respect to the March 31, 2011, deadline that are best dealt with on a case-by-case basis in an administrative manner, rather than by wholesale program change.
In preparation for this submission, we surveyed our membership. In every instance, the survey respondents indicated that they are working towards completing projects in advance of the deadline; however, there are some instances in which certain concerns have been voiced about the March 31 deadline.
As you consider the impact of the deadline for these programs, we would ask that you do so in consideration of another date: when the funding decisions were made. The rollout of the infrastructure stimulus fund and the Building Canada community top-up fund was slower in British Columbia than in most other provinces. We understand that as soon as funding announcements in most other provinces and territories were made, in late spring or early summer of 2009, they were in effect allowed two construction seasons to complete the projects. This did not happen in British Columbia. The vast majority of announcements involving local governments did not occur until the end of September 2009.
The principal reason for the delay was that there was a provincial election in May of 2009 and a need for the newly elected government to bring forward a budget update, which was not introduced until September 1, 2009. Not all of the British Columbia approvals were announced in September. Some were later.
Let's take a look for a minute at Metro Vancouver, with a population of 2.3 million. In Metro Vancouver's case, funding for Annacis Island Centre for Excellence was not announced until January 2010. This is despite the fact that their application was submitted early in 2009. The project was indeed shovel-ready when it was submitted early in 2009, but almost a full year passed before it was approved.
Metro Vancouver has reported that while they plan to substantially complete construction for the $9 million centre by the deadline, they are aware that the short timeline allows no room for any delays.
Our most important message to you, the committee, as you consider the March 31, 2011, construction deadline is that the late announcement of funding decisions effectively limited the period of construction for these projects to a single season. In many communities, the construction season is April to October, with key suppliers such as asphalt plants closing operation in mid fall and opening in spring. So while the funding announcements in B.C. might have been four months later than in other parts of the country, some communities effectively lost a year when you consider that we lost a full construction season.
To offset the challenges resulting from the late announcements, some local governments are taking aggressive steps to implement projects.
Let us take the District of Chetwynd, for instance. Chetwynd is a municipality of 3,000 residents in the Peace River region of northeastern British Colombia. In their case, they decided to award a construction contract to implement a communities component top-up storm drainage project in advance of securing a signed agreement with the funding partners. While the grant had been announced, and verbal commitments in relation to the funding agreements were given, the decision to award the construction contract was not without risk for the municipality, a risk that Chetwynd was willing to take to ensure the project could be completed by the deadline. Chetwynd comments that it simply would not be possible to have completed the full scale of the project in the timeframe allotted had they not taken this extraordinary step.
We provide the District of Chetwynd as an example to show the commitment of B.C. local governments to meeting the March 31, 2011, deadline. Other local governments also reported fast-tracking various parts of their projects to do everything possible to ensure they could meet the construction deadline. This was a common response to our survey.
However, we all know that despite best efforts, unexpected events and delays do occur. Many of these were outside of the direct control of the local governments. We think there needs to be a level of flexibility around the March 31 deadline on a case-by-case basis. We will provide a couple of examples of the need for this flexibility.
When it comes to managing local government infrastructure projects, there are many aspects of the process that lie outside a local government's scope of power or authority. As projects move through the design, engineering, and construction stages, federal and provincial bodies play a vital regulatory role.
Most of these projects involve approvals from multiple regulating entities, including everything from approval of work plans, to environmental assessments, to a host of permitting requirements. Consider the case of the city of Kamloops, a city of 86,000 in the Thompson Nicola area of south central B.C. The city received approval for the Westsyde riverbank protection under the Building Canada fund's communities component.
An environmental assessment is required for the project, and the city began preparing the environmental assessment document months ago. One of the components of the document was an archeological overview assessment to be provided by the Kamloops Indian Band. As of last week, the archeological assessment had not been completed, which means the city's environmental assessment document remains incomplete and the project cannot proceed.
Kamloops is working to meet the expectations of the Department of Fisheries and Oceans, which requires that the construction occur within the limited timeframe due to fish habitat constraints. If the timeframe is missed due to the issues associated with the environmental assessment, the project could potentially be delayed until the next appropriate window, which will likely be some time next year. This would mean that Kamloops would not meet the March 31, 2011, deadline.
There are a number of examples of situations in which the regulatory process can delay a project. These delays are often out of the hands of the local government, and indeed may be out of the hands of the regulatory agencies, particularly where several approvals from multiple agencies are required.
Some of our members, particularly in the northern, rural, and remote regions, are experiencing delays due to shortages of material, qualified workers, and professionals. A good example of this is a project under construction in Tumbler Ridge. The District of Tumbler Ridge is located in northeastern British Columbia, 1,200 kilometres from Vancouver. It received funding to upgrade its recreation centre under the recreational Infrastructure Canada program.
The panelling specified for the project is a new, high-energy-efficient product, carried by only three suppliers. The product is popular due to its energy efficiency, and the suppliers are unable to keep up with demand, resulting in delivery delays. In the case of this project, delivery has delayed the project by about six weeks.
Tumbler Ridge is also experiencing a shortage of qualified professionals and has experienced lags of up to a month to obtain approvals from structural engineers at critical points in the construction process. This problem is exacerbated by the limited number of contractors in the area, since their work must be coordinated with that of the engineering professionals.
While these delays may seem minor, they must be considered in the context of a construction season that is extremely short. A delay of even a month or two will mean that construction cannot be completed before winter sets in, delaying further construction until late March 2011.
As stated earlier, we are not recommending an overhaul of stimulus programs that by and large are working well. Instead we believe there may be opportunities to provide some flexibility around the March 31, 2011, deadline, on a case-by-case basis, while maintaining Canada's objectives for the program. Two specific ideas to provide this flexibility relate to claims management and an integrated management approach for regular and top-up communities component funding. Claims could be managed by using the federal portion of the grant towards costs incurred prior to March 31, 2011, and for those projects that are not fully complete at that date, withholding provincial funding pending project completion. Integrated management of the regular and top-up funding would provide an opportunity to recognize any communities component project completed by March 31, 2011, as a stimulus project.
While we have shown some examples of top-up projects that are behind schedule, there are examples of regular communities components that are ahead of schedule and will be complete prior to the March 2011 deadline. Integrating the management of both programs would provide the needed flexibility to designate any project completed by March 31, 2011, as a stimulus project.
As we have indicated throughout this presentation, we are not seeking an across-the-board extension of the March 31 deadline. However, as these examples show, there are circumstances where local governments have acted in good faith but are threatened with circumstances beyond their control. In these instances, we would like to see administrative flexibility to address these projects on an individual basis.
I thank you for this opportunity, Mr. Chairman and honourable members.