Transport Committee on Oct. 29th, 2024

[Sonia Daoust, General Manager, Organisme de bassin versant de la Yamaska]

Thank you very much. Good morning, everyone.

L'Organisme de bassin versant de la Yamaska was commissioned by the Yamaska committee, comprised of mayors from Mr. Simon‑Pierre Savard‑Tremblay's riding, to conduct a review of literature on the effects of wake boats and the speed of motor boats on shoreline erosion and sediment suspension in certain sections of the Yamaska River. Today, I will present the conclusions of our review that can also be applied elsewhere.

There are a few concepts to define, including eutrophication, i.e., the aging of waterways. Waterways age like humans, but they are increasingly doing so at a much faster rate. That is what is worrisome.

Next, I would like to talk about the movement and effect of waves, known as wake. When watercraft produce waves, each wave is charged with kinetic turbulence energy, and therein lies the problem. The faster a wave breaks on the shore, the more energy it discharges, not in the water, but on the shore.

Wake sports boats are designed to produce large waves of a particular shape using their ballast system. This technology is used for certain water sports such as wake boarding and wake surfing, which other witnesses have talked about.

To assess the effect of waves generated by boats, including wake boats, you have to be able to show that there is a difference between the energy of a wave resulting from wind and natural processes and that of waves produced by boats. If wave energy received on the shoreline is higher when produced by boats than in so-called natural waves, it is reasonable to believe that shorelines and riverbeds will have more damage from waves generated by boats. Then, of course, you have to show that this difference in energy will have a marked effect on erosion and sediment disturbance.

Generally speaking, boats passing at normal speed contribute little to wave energy compared to wind. On the other hand, waves generated by wake sports boats have a bigger impact on the shore. These boats generate waves that transfer more energy to the shore than wind, paddle boats, flat-bottom boats, trolling engines or high-speed boats. We're talking about four to twelve times more energy, depending on the studies we reviewed. It is therefore reasonable to say that the regular passage of boats that create big wakes accelerates shoreline erosion.

Some of those same studies also indicate a positive correlation between turbidity and suspended phosphorus. This shows that increasing wave energy generated by boats can lead to greater phosphorus concentration in water through the disturbance of various bottom sediments and the release of nutrients, which will obviously accelerate eutrophication.

Added to this is navigation speed, which is known to influence shoreline degradation. You've heard it before. Studies show a significant reduction in shoreline erosion when boats travel at low speeds, i.e., 10 kilometres an hour.

As part of our study, we also identified other impacts on ecosystems related to the passage of wake sports boats. First, there is the increased risk of invasion by alien species of the body of water. You've heard how important it is to clean boats. With the ballast system, you have to clean the inside of the boat, not just the outside, or you can run into problems. Then there is the disruption and degradation of aquatic grass beds and wildlife habitats through turbulence, as well as the disruption of bird nesting caused by noise and wave impact.

As a result, wake sports boats shouldn't get close to the shore. The distance between them and the shore, according to the studies we consulted, varies between 90 and 190 metres. Since many parts of the Yamaska, like other areas and bodies of water, aren't wide enough to provide that kind of a buffer zone, our recommendation is to prohibit this type of boat, and therefore the practice of activities such as wake boarding and surfing, and to limit the speed of boat traffic to 10 kilometres an hour.

We believe that with the knowledge we've gained and will gain in the future, we can provide a better framework for aquatic activities and a better way to share our waterways.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Ms. Daoust. You were right on the mark at five minutes. Well done.

I now give the floor to Marie‑France MacKinnon for five minutes.

[Marie-France MacKinnon, Executive Director, National Marine Manufacturers Association Canada]

Thank you, Mr. Chair.

Thank you to the committee for the invitation.

My name is Marie-France MacKinnon. I'm the executive director of the National Marine Manufacturers Association Canada.

As the leading association representing the recreational boating industry in our country, we have over 80 member companies, including renowned boat and engine manufacturers, marine accessories providers and service organizations.

The recreational boating industry is a vital component of our Canadian economy, providing over 80,000 jobs across Canada, particularly in rural areas, where these jobs can be a lifeline for local economies.

Our industry contributes over $9.2 billion to Canada's gross domestic product and generates $4.6 billion in tax revenues for municipal, provincial and federal governments.

However, this economic success is based on one fundamental principle: the right of Canadians to access their waterways.

The National Marine Manufacturers Association Canada advocates for a consultative process that actively involve national, regional and local recreational boating organizations. This participation is essential to ensure that the voices of recreational boaters are heard and taken into account when regulations are proposed.

We believe it's vital to prevent unnecessary regulation under the VORRs, and to seek non-regulatory, consensus-building solutions to local issues. We cannot have a situation that creates barriers to accessing our lakes, beautiful rivers and coastal areas, which all Canadians have the right to access. Regarding the upcoming regulatory changes outlined in the Canada Gazette, we're asking for a formal consultation process when local authorities request navigation restrictions on any of its waterways. We firmly believe we can find practical, non-regulatory solutions to local issues by working together—government, industry, local communities and recreational boaters. It's through collaboration and community consensus that we can enhance safety and enjoyment on all of our waterways, without a patchwork of needless red tape and restrictions.

We also need critical investment to modernize Canada's outdoor infrastructure in order to make recreational boating more accessible. Upgrading our aging marinas, boat ramps and public access points is essential for enhancing safety, promoting outdoor recreation and stimulating tourism.

These improvements provide a better experience for boaters, foster community and environmental management, and inspire a lasting appreciation of our natural resources for the benefit of future generations.

Finally, I want to take this opportunity to address a critical issue impacting our industry, the luxury tax, which you've heard about. This tax has severely affected the Canadian boating industry, leading to a crucial decline in sales of recreational boats over $250,000. Let's be clear. This downturn threatens jobs, the livelihoods within the sector and the hard-working Canadians who are proudly building Canadian products.

The Select Luxury Items Tax Act must be amended so that recreational boats are no longer subject to this unfair tax.

The repercussions of this tax extend beyond lost sales figures. They also lead to a loss of associated tax revenues for the government. CRA data from September 2022 to June 2024 show a total collection of $12 million. That's $40 million short of the PBO's own projection. As a result, people are buying boats in the U.S., not here in Canada. We're also losing critical tourism dollars, especially in B.C., Ontario and Quebec. This isn't a tax on luxury boats and Canada's richest. It's a tax on the middle class and on Canadian jobs that depend on this sector. It's a tax on small businesses, rural communities and local economies across this country.

Thank you for the invitation. We want to work together to ensure that all Canadians can access our waterways and create memories with their families on our beautiful bodies of water. Thank you.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Ms. MacKinnon.

Mr. Bankes, the floor is yours. You have five minutes for your opening remarks, sir.

[Ron Bankes, Port Rowan Harbour Committee]

Thank you.

My name is Ron Bankes. I live in Port Rowan, Ontario, and I've operated my business here in Port Rowan for 37 years. While operating my boat building and restoration business, I was a frequent user of the Port Rowan Harbour Marina.

Today, I'm representing the Port Rowan Harbour Committee. It's a volunteer committee, and our purpose is to work with Norfolk County to ensure the preservation and enhancement of the Port Rowan Harbour Marina as a public resource that is accessible, sustainable and beautiful for the enjoyment and well-being of the community and visitors alike.

This is a very unique waterfront property in Norfolk that offers full public access while still maintaining the commercial and cultural aspects of its operations as it has for many generations. The park area of the harbour is used by the public to host a three-day Bayfest celebration, farmers markets in the fall every Friday afternoon, prayer services on Sunday mornings from May through September and the occasional concert in the park.

Norfolk County has a detailed report outlining items they feel need to be accomplished to maintain the operation of the harbour over the upcoming years. Most important is dredging of the harbour so boaters will have safe access to the marina. Improving the launch ramp and improving transient dockage would attract more boaters to the harbour, and we recognize the importance of the harbour marina facility to Port Rowan and all of Norfolk County.

In short, there is no shortage of interest, suggestions or willingness from volunteer groups such as the Lions Club and others to accomplish these goals; there is only a lack of funding for infrastructure projects.

We support Norfolk in all aspects of fundraising and offer whatever assistance this committee can while developing the policies that will ensure public ownership and access while maintaining the safe operation of this valuable resource for many generations to come.

Basically, I am just speaking about the Port Rowan Harbour and a little bit of its history.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Bankes.

We'll begin our line of questioning today with Mr. Lawrence.

Mr. Lawrence, the floor is yours. You have six minutes, sir.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you, Mr. Chair.

My questions today will be for Ms. MacKinnon.

Ms. MacKinnon, I want to talk to you a little bit about what has happened over the last nine years and the impact that has had on your industry. Over these last nine years, we've seen an exponential increase in red tape. We've seen an exponential increase in taxation. Specifically, I'm talking about the carbon tax, which, of course, will increase the cost of fuel, which is a major cost if you own a recreational boat. We've also seen, of course, as you mentioned, the luxury tax.

Your industry is responsible for thousands of jobs. Recreational boating represents billions of dollars to our economy. Could you talk to us a little bit about how the carbon tax, the luxury tax and the increase in red tape have affected your industry?

[Marie-France MacKinnon]

The luxury tax is a prime example. It's not a tax just on boats; it's a tax on the jobs that we're seeing across the country. What seems to get lost in a lot of this is the broader impact above and beyond recreational boats. It's not just about our sector; think about a marina and everything that goes around that with the tourism of people who come to boat in specific areas. The tourism impact is huge.

Mr. Layzell earlier talked about the jobs lost, but that's specific to our industry. When you think about local restaurants, marinas, shops and everything that's related, all of these taxes compiled together are a huge burden on our companies.

We have only a handful of manufacturers left in our country because it makes a lot more sense sometimes for manufacturers to go south of the border. It's the same way that now boat owners are looking to buy south of the border because of the tax burden in Canada.

The burden of all these added costs on our businesses and manufacturers who are here trying to export boats to other markets is huge. With the extra tax on recreational boat owners, if you own a boat, it's one thing to have a carbon tax and to have the luxury tax, but there are some areas where it costs you $350 to put your boat in the water for a day to take your kid fishing. That's unreasonable. Canadians should have access to all waterways without there seeming to be privatization of specific areas.

All of these taxes are a burden, and it's taking a toll on manufacturers and businesses that are trying to grow their businesses here in Canada.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you, Ms. MacKinnon.

I'll just break that down on a couple of issues that you raised.

First, I'll start off with the carbon tax. The quadrupling of the carbon tax would substantially increase the cost of fuel that would be used by boat owners. I would point out that 60% of boat owners actually earn less than $100,000. This is not the ultra-wealthy; this is the middle class.

Would the quadrupling of the carbon tax hurt or help your industry?

[Marie-France MacKinnon]

It would hurt the industry. Any extra tax is hurting the industry.

When you think about owning a boat, like you said, most boat owners are not yacht owners. These are middle-class Canadians who just have a boat and take their kid fishing or take their pontoon on the water with their family on the weekend.

With the gas and everything that is added onto Canadians right now, to be out there enjoying our beautiful lake and rivers is getting hard for Canadians. We're seeing it in declined sales. We had great sales during the pandemic when our industry saved a lot of Canadians because that was the number one thing you could do to get out there and enjoy it.

All of these burdens of extra taxes now, with the carbon tax and luxury tax, are taking a toll on our sector. A lot of jobs are at stake. A lot of Canadian manufacturers and small businesses are impacted.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

We heard from both viewpoints with respect to the carbon tax and the luxury tax—that it applies to Canadians and the Canadian industry. It will affect the middle class—the workers who are out in the factories building these boats. It will affect, like you said, the mom and dad who want to take their daughter or son fishing.

Now, those folks who have yachts have an ability to get away with this because they could go to the United States.

If they bought a boat in the United States, would they have to pay the Canadian luxury tax or Canadian carbon tax?

[Marie-France MacKinnon]

They just leave their boats out in the U.S. It's way easier. If you're going to buy a yacht or a boat over $250,000 and decide to buy it in Florida, for the amount of money you're saving on the luxury tax, you can fly to Florida a lot of times or drive down. Decisions are being made.

What's also being lost here, when I talked about tourism.... I was talking to a dealer in Quebec who said he used to do 70% of his sales in Quebec and 30% across the border. He is now 70% across the border and 30% in Quebec.

What does that do? That's allowing Canadians or Quebeckers to cross the border and discover other beautiful areas in northern states that are available for boating. We're losing out on that tourism aspect.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

This is a tax that hurts Canadian families and that particularly affects Quebeckers.

[Marie-France MacKinnon]

Absolutely.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Lawrence.

Mr Lauzon, you have the floor for six minutes.

[Stéphane Lauzon, Liberal, Argenteuil—La Petite-Nation, QC]

Thank you, Mr. Chair.

Ms. MacKinnon, I'm interested in the numbers you mentioned. You say, for example, that people are encouraged to go and buy a boat in Florida. When a buyer goes to Florida to pick up their boat at a cost of $250,000, they have to pay a 10% luxury tax, or $25,000. You say that it makes more sense to go to the United States to buy it. However, when you cross the border to enter Canada, you have to pay customs duties on the exact value of the boat purchased in Florida. Do your figures take into account the fact that the tax would have to be repaid in another way before the vessel can be brought to Canada?

[Marie-France MacKinnon]

I would say that people who buy boats in Florida leave them there. It's not just that they're buying a boat and bringing it back to Canada. The problem is that they just decide to leave the boat in the United States, because it makes more sense for them to leave it there than bring it to Canada and have to pay the taxes.

[Stéphane Lauzon, Liberal, Argenteuil—La Petite-Nation, QC]

Ms. MacKinnon, we have Canadian boaters on the rivers. In my riding, there are some who travel on the Ottawa River. You can find $400,000 or $500,000 boats moored at the Fairmont Le Château Montebello. These people don't leave their boats in Florida to avoid $25,000 in taxes. It doesn't make sense. My riding, Argenteuil‑La Petite‑Nation, has 41 municipalities and, in each of them, there are boat owners. That's all I have to say on that topic.

Ms. Daoust, I would like to know how your organization is working with the municipalities. I assume, because I'm not too familiar with your region, that there are a number of municipalities located in the Yamaska watershed. How do you work with them? How do you work with municipalities as an organization and provide information?

[Sonia Daoust]

It's actually a little more complex. I'll have to explain our funding model.

We are funded in part by the Government of Quebec to conduct round tables. Using the round tables, we develop a water master plan. Our mandate is to get the various water stakeholders in the region working towards the sustainable management of our wonderful water resource.

On top of this, we receive requests, particularly from the Yamaska committee. We receive grants that enable us to work on one project at a time. We don't work for free and we don't offer pro bono services, unfortunately. When we work with clients, they have to pay for our services.

We enjoy an excellent working relationship with the municipalities, as well as with the region's county municipalities across the region. We can play an advisory role. We can also play a coordinating role and we can work on various projects and studies, including urban characterization projects. We can also offer our expertise when this service is required.

Obviously, we would like to expand our mandate. I know this is not part of your remit, but we would like our mandate to be broadened so as to collaborate more extensively on everything to do with waterways and the environment.

[Stéphane Lauzon, Liberal, Argenteuil—La Petite-Nation, QC]

For your information, and I say it for the benefit of this committee as well, federal funding has been provided to improve the health of Lake Massawippi. A crisis management committee was created to assess the environmental effects on the lake. This funding comes from Fisheries and Oceans Canada and the Massawippi Regional Park Authority. These stakeholders have been doing fantastic work together since 2021.

I would like to go back to one point. I want to talk about boats that produce large waves. You used a term that was new to me. When you were talking about these boats, you mentioned wake boats as well as high-speed boats.

A number of witnesses and yourself have spoken at length about the height of waves that have an environmental impact on the shorelines. However, you have not said much about climate change that is responsible for the excessive temperatures or winds we have today that we did not have before, and their effect on waves.

Do you take climate change into consideration in your studies?

[Sonia Daoust]

It's important to distinguish between wake boats and high‑speed boats.

We reviewed all the literature on wake boats and high‑speed boats. For high‑speed boats, we didn't find any studies showing an impact. We also just reviewed the published literature, without conducting any study or analysis. I'm giving you the findings of other people's studies.

That's why, unfortunately, I can't—

[Stéphane Lauzon, Liberal, Argenteuil—La Petite-Nation, QC]

Did you take climate change into account in the findings of your studies and in your review?

[Sonia Daoust]

I couldn't tell you. I was told that the authors of some of the referenced studies would be invited as witnesses. Unfortunately, I must stick to my response. I can't answer that question, because we would need to measure the strength of the wind over time. I don't know of any studies on this topic at the moment.

[Stéphane Lauzon, Liberal, Argenteuil—La Petite-Nation, QC]

Over the course of your reading, you consulted extensively with municipalities, boaters and owners of large boats. How many of them talked to you about the impact of the price of gas for their small, medium or $250,000‑plus boats?

[Sonia Daoust]

Thank you again for your question. However, I can't give you an answer, since we consulted only the published literature.

We didn't consult people on the ground. We actually consulted a two‑page list of studies on current navigation issues.