British Columbia Hansard — 13 March 2018, p.m., Issue 103 (41st Parliament, 3rd Session)

20180313pm-Hansard-n103

British Columbia — Debates (Hansard)

Third Session, 41st Parliament OFFICIAL REPORT OF DEBATES (HANSARD) Tuesday, March 13, 2018 Afternoon Sitting Issue No. 103 THE HONOURABLE DARRYL PLECAS, SPEAKER ISSN 1499-2175

PROVINCE OF BRITISH COLUMBIA (Entered Confederation July 20, 1871) LIEUTENANT-GOVERNOR Her Honour the Honourable Judith Guichon, OBC Third Session, 41st Parliament SPEAKER OF THE LEGISLATIVE ASSEMBLY Honourable Darryl Plecas EXECUTIVE COUNCIL Premier and President of the Executive Council............................................................................................................... Hon. John Horgan Deputy Premier and Minister of Finance............................................................................................................................Hon.

Carole James Minister of Advanced Education, Skills and Training..................................................................................................... Hon. Melanie Mark Minister of Agriculture.........................................................................................................................................................Hon. Lana Popham Attorney General.................................................................................................................................................................Hon.

David Eby, QC Minister of Children and Family Development............................................................................................................ Hon. Katrine Conroy Minister of State for Child Care......................................................................................................................................Hon. Katrina Chen Minister of Citizens’ Services.................................................................................................................................................... Hon.

Jinny Sims Minister of Education............................................................................................................................................................ Hon. Rob Fleming Minister of Energy, Mines and Petroleum Resources...............................................................................................Hon. Michelle Mungall Minister of Environment and Climate Change Strategy.............................................................................................Hon.

George Heyman Minister of Forests, Lands, Natural Resource Operations and Rural Development..............................................Hon. Doug Donaldson Minister of Health.....................................................................................................................................................................Hon. Adrian Dix Minister of Indigenous Relations and Reconciliation ......................................................................................................... Hon.

Scott Fraser Minister of Jobs, Trade and Technology............................................................................................................................ Hon. Bruce Ralston Minister of State for Trade...............................................................................................................................................Hon. George Chow Minister of Labour...................................................................................................................................................................Hon.

Harry Bains Minister of Mental Health and Addictions............................................................................................................................ Hon. Judy Darcy Minister of Municipal Affairs and Housing.................................................................................................................. Hon. Selina Robinson Minister of Public Safety and Solicitor General........................................................................................................... Hon.

Mike Farnworth Minister of Social Development and Poverty Reduction..............................................................................................Hon. Shane Simpson Minister of Tourism, Arts and Culture.....................................................................................................................................Hon. Lisa Beare Minister of Transportation and Infrastructure................................................................................................................ Hon.

Claire Trevena LEGISLATIVE ASSEMBLY Leader of the Official Opposition................................................................................................................................Andrew Wilkinson, QC Leader of the Third Party ....................................................................................................................................................Dr. Andrew Weaver Deputy Speaker................................................................................................................................................................................

Raj Chouhan Assistant Deputy Speaker................................................................................................................................................................... Linda Reid Deputy Chair, Commi ttee of the Whole................................................................................................................

Spencer Chandra Herbert Clerk of the Legislative Assembly ....................................................................................................................................................Craig James Deputy Clerk and Clerk of Commi ttees.................................................................................................................................

Kate Ryan-Lloyd Clerk Assistant — Commi ttees and Interparliamentary Relations ..........................................................................................Susan Sourial Sessional Law Clerk...............................................................................................................................................Loredana Catalli-Sonier, QC Sergeant-at-Arms ................................................................................................................................................................................. Gary Lenz

ALPHABETICAL LIST OF MEMBERS Ashton, Dan (BC Liberal)........................................................................ Penticton Bains, Hon. Harry (NDP)...............................................................Surrey-Newton Barnett, Donna (BC Liberal)................................................... Cariboo-Chilcotin Beare, Hon. Lisa (NDP).............................................Maple Ridge–Pitt Meadows Begg, Garry (NDP) ..................................................................... Surrey-Guildford Bernier, Mike (BC Liberal).......................................................

Peace River South Bond, Shirley (BC Liberal)......................................... Prince George–Valemount Brar, Jagrup (NDP)..................................................................... Surrey-Fleetwood Cadieux, Stephanie (BC Liberal)....................................................... Surrey South Chandra Herbert, Spencer (NDP) ..................................... Vancouver–West End Chen, Hon. Katrina (NDP).....................................................Burnaby-Lougheed Chouhan, Raj (NDP) ............................................................... Burnaby-Edmonds Chow, Hon.

George (NDP)............................................... Vancouver-Fraserview Clovechok, Doug (BC Liberal)................................ Columbia River–Revelstoke Coleman, Rich (BC Liberal)...............................................................Langley East Conroy, Hon. Katrine (NDP)......................................................... Kootenay West Darcy, Hon.

Judy (NDP) ............................................................New Westminster Davies, Dan (BC Liberal)..........................................................Peace River North de Jong, Michael, QC (BC Liberal)............................................ Abbotsford West Dean, Mitzi (NDP)...............................................................Esquimalt-Metchosin D’Eith, Bob (NDP) ...............................................................Maple Ridge–Mission Dix, Hon. Adrian (NDP)......................................................Vancouver-Kingsway Donaldson, Hon.

Doug (NDP).....................................................................Stikine Eby, Hon. David, QC (NDP).............................................Vancouver–Point Grey Elmore, Mable (NDP)....................................................... Vancouver-Kensington Farnworth, Hon. Mike (NDP) ...................................................... Port Coquitlam Fleming, Hon. Rob (NDP) .....................................................Victoria–Swan Lake Foster, Eric (BC Liberal)........................................................... Vernon-Monashee Fraser, Hon.

Scott (NDP) ................................................ Mid Island–Pacific Rim Furstenau, Sonia (BC Green Party) ........................................... Cowichan Valley Gibson, Simon (BC Liberal)................................................. Abbotsford-Mission Glumac, Rick (NDP)........................................................Port Moody–Coquitlam Heyman, Hon. George (NDP).............................................. Vancouver-Fairview Horgan, Hon. John (NDP) ...............................................

Langford–Juan de Fuca Hunt, Marvin (BC Liberal).......................................................Surrey-Cloverdale Isaacs, Joan (BC Liberal).........................................Coquitlam–Burke Mountain James, Hon. Carole (NDP)...................................................Victoria–Beacon Hill Johal, Jas (BC Liberal)...............................................

Richmond-Queensborough Kahlon, Ravi (NDP)..............................................................................Delta North Kang, Anne (NDP)..................................................................Burnaby–Deer Lake Krog, Leonard Eugene (NDP) ..................................................................Nanaimo Kyllo, Greg (BC Liberal)............................................................................ Shuswap Larson, Linda (BC Liberal).............................................Boundary-Similkameen Lee, Michael (BC Liberal)......................................................

Vancouver-Langara Leonard, Ronna-Rae (NDP) ....................................................Courtenay-Comox Letnick, Norm (B C Liberal)............................................Kelowna–Lake Country Ma, Bowinn (NDP)................................................... North Vancouver–Lonsdale Mark, Hon. Melanie (NDP) ..................................... Vancouver–Mount Pleasant Martin, John (BC Liberal)...................................................................... Chilliwack Milobar, Peter (BC Liberal)....................................

Kam loops–North Thompson Morris, Mike (BC Liberal)..........................................Prince George–Mackenzie Mungall, Hon. Michelle (NDP).................................................... Nelson-Creston Oakes, Coralee (BC Liberal)...........................................................Cariboo North Olsen, Adam (B C Green Party)........................... Saanich North and the Islands Paton, Ian (BC Liberal)......................................................................... Delta South Plecas, Hon.

Darryl (Ind.) ..........................................................Abbotsford South Polak, Mary (BC Liberal)............................................................................ Langley Popham, Hon. Lana (NDP)..............................................................Saanich South Ralston, Hon. Bruce (NDP) .......................................................... Surrey-Whalley Redies, Tracy (BC Liberal)..................................................... Surrey–White Rock Reid, Linda (BC Liberal)................................................

Richmond South Centre Rice, Jennifer (NDP) ............................................................................ North Coast Robinson, Hon. Selina (NDP) ....................................... Coquitlam-Maillardville Ross, Ellis (BC Liberal)..................................................................................Skeena Routledge, Janet (NDP) .................................................................. Burnaby North Routley, Doug (NDP) ................................................Nanaimo–North Cowichan Rustad, John (BC Liberal)..............................................................

Nechako Lakes Shypitka, Tom (B C Liberal).............................................................Kootenay East Simons, Nicholas (NDP) ........................................Powell River–Sunshine Coast Simpson, Hon. Shane (NDP)................................................ Vancouver-Hastings Sims, Hon.

Jinny (NDP) .............................................................Surrey-Panorama Singh, Rachna (NDP) ........................................................Surrey–Green Timbers Stewart, Ben (BC Liberal)................................................................Kelowna West Stilwell, Michelle (BC Liberal)..............................................Parksville-Qualicum Stone, Todd (BC Liberal)........................................

Kam loops–South Thompson Sturdy, Jordan (BC Liberal).......................................West Vancouver–Sea to Sky Sullivan, Sam (B C Liberal)...............................................Vancouver–False Creek Sultan, Ralph (BC Liberal)......................................... West Vancouver–Capilano Tegart, Jackie (BC Liberal)................................................................ Fraser-Nicola Thomson, Steve (BC Liberal).....................................................Kelowna-Mission Thornthwaite, Jane (BC Liberal).............................

North Vancouver–Seymour Throness, Laurie (BC Liberal)..................................................... Chilliwack-Kent Trevena, Hon. Claire (NDP) .............................................................. North Island Wat, Teresa (BC Liberal)................................................Richmond North Centre Weaver, Dr. Andrew (BC Green Party) ......................... Oak Bay–Gordon Head Wilkinson, Andrew, QC (BC Liberal).............................. Vancouver-Quilchena Yap, John (BC Liberal)..........................................................

Richmond-Steveston LIST OF MEMBERS BY RIDING Abbotsford-Mission ..........................................................................Simon Gibson Abbotsford South ..................................................................... Hon. Darryl Plecas Abbotsford West.................................................................... Michael de Jong, QC Boundary-Similkameen.....................................................................

Linda Larson Burnaby–Deer Lake ...............................................................................Anne Kang Burnaby-Edmonds ..............................................................................Raj Chouhan Burnaby-Lougheed................................................................... Hon. Katrina Chen Burnaby North................................................................................

Janet Routledge Cariboo-Chilcotin............................................................................Donna Barnett Cariboo North .................................................................................. Coralee Oakes Chilliwack.............................................................................................. John Martin Chilliwack-Kent..............................................................................Laurie Throness Columbia River–Revelstoke........................................................

Doug Clovechok Coquitlam–Burke Mountain................................................................. Joan Isaacs Coquitlam-Maillardville..................................................... Hon. Selina Robinson Courtenay-Comox ................................................................. Ronna-Rae Leonard Cowichan Valley............................................................................

Sonia Furstenau Delta North ...........................................................................................Ravi Kahlon Delta South.................................................................................................Ian Paton Esquimalt-Metchosin.............................................................................Mitzi Dean Fraser-Nicola........................................................................................

Jackie Tegart Kam loops–North Thompson............................................................Peter Milobar Kam loops–South Thompson ................................................................Todd Stone Kelowna–Lake Country....................................................................Norm L etnick Kelowna-Mission.............................................................................

Steve Thomson Kelowna West.........................................................................................Ben Stewart Kootenay East.....................................................................................Tom Shypitka Kootenay West...................................................................... Hon. Katrine Conroy Langford–Juan de Fuca............................................................. Hon. John Horgan Langley....................................................................................................

Mary Polak Langley East.......................................................................................Rich Coleman Maple Ridge–Mission ............................................................................ Bob D’Eith Maple Ridge–Pitt Meadows ..........................................................Hon. Lisa Beare Mid Island–Pacific Rim .............................................................. Hon. Scott Fraser Nanaimo...............................................................................

Leonard Eugene Krog Nanaimo–North Cowichan.............................................................. Doug Routley Nechako Lakes...................................................................................... John Rustad Nelson-Creston.................................................................. Hon. Michelle Mungall New Westminster......................................................................... Hon. Judy Darcy North Coast..........................................................................................

Jennifer Rice North Island............................................................................ Hon. Claire Trevena North Vancouver–Lonsdale................................................................. Bowinn Ma North Vancouver–Seymour......................................................Jane Thornthwaite Oak Bay–Gordon Head..........................................................Dr. Andrew Weaver Parksville-Qualicum .....................................................................Michelle Stilwell Peace River North..................................................................................

Dan Davies Peace River South............................................................................... Mike Bernier Penticton................................................................................................ Dan Ashton Port Coquitlam .................................................................... Hon. Mike Farnworth Port Moody–Coquitlam .....................................................................Rick Glumac Powell River–Sunshine Coast.....................................................

Nicholas Simons Prince George–Mackenzie..................................................................Mike Morris Prince George–Valemount.................................................................Shirley Bond Richmond North Centre ........................................................................Teresa Wat Richmond-Queensborough.......................................................................Jas Johal Richmond South Centre........................................................................

Linda Reid Richmond-Steveston.................................................................................. John Yap Saanich North and the Islands............................................................Adam Olsen Saanich South............................................................................Hon. Lana Popham Shuswap .................................................................................................... Greg Kyllo Skeena.........................................................................................................

Ellis Ross Stikine ..................................................................................Hon. Doug Donaldson Surrey-Cloverdale...............................................................................

Marvin Hunt Surrey-Fleetwood...................................................................................Jagrup Brar Surrey–Green Timbers ......................................................................Rachna Singh Surrey-Guildford....................................................................................Garry Begg Surrey-Newton.............................................................................Hon. Harry Bains Surrey-Panorama........................................................................... Hon.

Jinny Sims Surrey South...............................................................................Stephanie Cadieux Surrey-Whalley........................................................................ Hon. Bruce Ralston Surrey–White Rock............................................................................. Tracy Redies Vancouver-Fairview ............................................................ Hon. George Heyman Vancouver–False Creek.......................................................................

Sam Sullivan Vancouver-Fraserview .............................................................Hon. George Chow Vancouver-Hastings.............................................................. Hon. Shane Simpson Vancouver-Kensington ..................................................................... Mable Elmore Vancouver-Kingsway ................................................................... Hon. Adrian Dix Vancouver-Langara.............................................................................. Michael Lee Vancouver–Mount Pleasant................................................... Hon.

Melanie Mark Vancouver–Point Grey...........................................................Hon. David Eby, QC Vancouver-Quilchena......................................................Andrew Wilkinson, QC Vancouver–West End....................................................Spencer Chandra Herbert Vernon-Monashee...................................................................................Eric Foster Victoria–Beacon Hill................................................................ Hon. Carole James Victoria–Swan Lake .................................................................. Hon.

Rob Fleming West Vancouver–Capilano................................................................. Ralph Sultan West Vancouver–Sea to Sky ..............................................................Jordan Sturdy Party Standings: BC Liberal 42; NDP 41; BC Green Party 3; Independent 1

CONTENTS Tuesday, March 13, 2018 Afternoon Sitting Page Orders of the Day Commi ttee of the Whole House............................................................................................................................................ 3433 Bill 2 — Budget Measures Implementation Act, 2018(continued) Hon. C. James S. Bond T.

Redies Reporting of Bills..................................................................................................................................................................... 3441 Bill 2 — Budget Measures Implementation Act, 2018 Commi ttee of Supply .............................................................................................................................................................. 3441 Estimates: Ministry of Forests, Lands, Natural Resource Operations and Rural Development Hon. D. Donaldson J. Rustad D. Barnett C. Oakes S. Bond D. Davies M. Morris I. Paton A.

Olsen Proceedings in the Douglas Fir Room Commi ttee of Supply .............................................................................................................................................................. 3460 Estimates: Ministry of Education (continued) T. Shypitka Hon. R. Fleming J. Thornthwaite J. Rustad B. Stewart D. Davies Estimates: Ministry of Environment and Climate Change Strategy Hon. G. Heyman P. Milobar M. de Jong

TUESDAY, MARCH 13, 2018 The House met at 1:32 p.m. [Mr. Speaker in the chair.] Orders of the Day Hon. M. Farnworth:In this chamber, I call continued commi ttee stage of the Budget Measures Implementation Act,Bill2. In Commi ttee A, I callcontinued debate on the estimates of the Ministry of Education, to be followed by the Ministry of Environment. If we finish Bill 2, then I will be calling the Ministry of Forests, Lands and Natural Resources estimates. Commi ttee of the Whole House BILL 2 — BUDGET MEASURES IMPLEMENTATION ACT, 2018 (continued) The House in Commi ttee of the Whole (Section

B) on Bill 2; L. Reid in the chair. The commi ttee met at 1:35 p.m. On

section 85 (continued). Hon. C. James: We were having a discussion, before we broke forlunch, aboutsome language thatis in the actthat, as I talked about,was routine language thatis in alltax stat- utes— in fact,it’s in alltaxstatutesacross the country — and that the protection is there for basic clericalerrors. I think that’s probably the best way of describing it.

This doesn’t absolve administration or staff or the bur- eaucracy from making errors, butitensures, if there was an error— an example, like somebody’s name is misspelled on the form or somebody’s phone number is wrong — that it preventsthe courtfrom overturning a fee thatis in placefor good reason and thathas gone throughdueprocess. If some- body has a fee to pay, it protectsgovernment from having that fee overturned. Thatdoes nottake away from the ability forpeoplestillto say: “There was aproblemhere. Due diligencewasn’tdone.

I can go to court.I can stillhave the opportunity to have the administrative process takenalook atto make sure there was due process.” Butthis protectsgovernmentagainsta simple clericalerroroverturning whatis avalidreason forsomeone to have afee in placeso thatthey have to pay the penalty and pay the fee.

Section 85 approved. On

section 86. S. Bond:Good afternoon, Minister. I understand thatsection 86 is simply consequentialto the amendmentsmadein

section 32. But perhaps the minister couldjustoutline forme: whattypes of “Regulations in rela- tion to tax paymentagreements” undersection 32 does the ministerenvision may be necessary with respectto this new eligibletaxservice?Is there some way to providean example of what would be captured under that clause? Hon. C. James: I think the easiestexamplewouldbe tim- ing of self-assessing the tax. Thatcouldbe in the regulation: here’s the timingof how they have to self-assess the taxthatis here now, with the eligibletaxableservices.Thatwasn’tthere before. Timing mightbe an exampleof whatwouldgo into the regulation.

Section 86 approved. On

section 87. T. Redies:

Section 87 adds regulation-making powers to exclude some on-line marketplaces from being on-line accomm odation platforms. Whatis the purpose behind this — forexempting some on-line marketplacesfrom the oblig- ation to pay tax? Couldyou give us some examplesof how this would fit? Hon. C. James: As we talked aboutin previous sections, this is related to on-line accomm odation platforms, where money exchanges hands — where a service happens and money is exchanged or payment is received.

An example would be somewhere where that isn’t happening. [1:40 p.m.] Thatwouldkind of be the flip sideof that:where there is no exchange of money — simply an ad, forexample— where it’s not an on-line accomm odation service, where people don’t reserve and then pay on the on-line platform. It may be just a basic ad advertising something or asking for something, where no money is exchanged. The key, really, on these pieces, on the previous

section that we talked about, and on this section, is the collection of money orthe collec- tion of the fee for the accomm odation. T. Redies: Thank you for that clarification, Minister. In terms of this particular section, are all operators currently required to collectand remitprovincialsalestaxwiththe on- line marketplace platform? Hon. C. James: This really is focusing on those on-line accomm odation providers outsidethe province.

They’re cur- rently outsideBritish Columbia.Therefore, we are putting in placethis enablinglanguage to enablethose individuals to be ableto collectand remitto government.That’s whatthe sec- tions provide for. There couldbe, rightnow, peoplepaying on line forhotels thatexistin British Columbia. They already have the ability 3433

to be able to collect tax because they’re based in British Columbia. An existing hotel could be going through this process and collecting the tax. This is focused on those on- line accomm odation providers outsidethe province. Cur- rently there is no provision for them to collectand remitto government. This provides that opportunity. S. Bond: We’re setting up the framework and the system to allow for taxes to be collected for platforms like Airbnb and others. We always use thatone because it’s the one we all remember, and it’s probably the most mentioned. Whatrequirementswillbe increased atthe ministry level?

I’m assuming, if we look atthe accumulation of the sections thatwe have…. We’re now on

section 87. There’s alotof new work beinghanded outhere. We’re lookingathow we collect taxes and when we collecttaxes, and we’re adding new taxes. Now we’re adding a new on-line accomm odation platform. What are the ministry requirementsin terms of managing this new tax collection system? Hon. C. James: There is work being done withinthe min- istry, so existing staff, to setup the geography and the infor- mation that’s needed from the on-line accomm odation pro- viders, but the existing tax structure for peopleto register and then to filereturns is already there.

There’s no additional work required forthat.That’s already an infrastructure that’s in place. They willjustuse the same infrastructure as other businesses do to register and to file returns. It’s really m aking sure thatthey’re setup to getthe right inform ation in. We’re going to provide som e additional support, butthere’s notan expectation thatitwillrequire additionalstaff. Rightnow that’s being m anaged withinthe ministry. S. Bond: Couldthe ministerjustdescribe for me whata “prescribed designated accomm odation area” is, please? [1:45 p.m.] Hon. C.

James: A prescribed area is related to the muni- cipal and regional district tax. So it is the geographicarea. The municipality or the regionaldistrict,howeverthey put themselves togetherto be ableto access the MRDT — that’s what a prescribed area is. Sections 87 and 88 approved. On

section 89. T. Redies:To the minister: can you explain whatthe intent of this particularsection is in terms of creating acategory of dwelling property? Hon. C. James: I think maybe the bestway to startthis, before I go through the definition, is justto look atwhatthe goalwas. The goal, through this schooltax, is to identify the homes or the types of homes where owners have benefited the mostfrom rising property valueswithouthaving the tax fall on providers of rental housing, for example. As I go through it,you willsee there is some included and some not included.

That’s really what we’ve done in defin- ing dwelling property. The tax base for dwelling property includes— and I’lljustrun through the list,if that’s helpful forthe member— a residenceand related residentialbuild- ings on farm land butnotfarm outbuildings; vacantland in class 1, unless the vacant land is in the agricultural land reserve; fee-simple homes and unstratified duplexes and triplexes; stratified condominiums and townhomes thatcur- rently receive a property assessment notice and a property tax notice. Whatdoes the tax base notinclude? I’lljustcontinue on with that,because I think that’s helpful.

Itdoes notinclude certain types of properties as described in the Residential Tenancy Act, so co-op housing rented to a member is not included; certain living accomm odations of an educational institution; emergency shelters or transitionalhousing; cer- tain health care facilities. [1:50 p.m.] Then there willbe regulatory powers thatgo with this act thatallow you to remove things, notto addthings. To add things is here in the legislation, but the regulatory powers willallow you to remove thingsif an exception comesup that needs to be addressed. T. Redies:Thank you, Minister, for that clarification.

In subsection 3, it refers to the ability to apply regula- tion retroactive to tax years 2019 or 2020. Is it the intent of this subsection, then, to notallow any retroactive regu- lations afterthe 2020 tax year, or is itthe intentto capture tax regardless of when the tax is implemented? How would this apply? Hon. C. James: This really is asection that’s putin placeto address anew taxcoming in. It’s notanew tax.It’s an expan- sion of a tax — buta new tax coming in — and the ability to be ableto, again through regulation, address any timing issuesthatmay arise thatweren’tthe purpose of the bill.

So it gives us the chancefortwo years, as we implementthis, and if we catch that there were timings when…. Forexample, the yearfinished on December31. You star- ted the new year. The tax billcame out.There were months in there thatwere charged thatshouldn’thave been charged. This givesus the ability to be ableto address thatthrough the regulation, forthose two years, as we implementthis taxbill. T. Redies: Why is it necessary to authorize the Lieu- tenant-Governor-in-Councilto m ake regulations respect- ing any m atterfor which regulations are contemplated by the definition of this “dwelling property”?

Itseems to give the Lieutenant-Governor very open-ended powers to tax property owners. Hon. C. James: The restriction on this power, so to speak 3434 British Columbia Debates Tuesday, March 13, 2018

— orthe authority, so to speak — is that:“…may make regu- lations respecting any matterforwhich regulations are con- templated by the definition of ‘dwelling property.’” It refers back, again, to the dwelling property list.Thatcomes back, again, to the piece that I talked about before, where you won’t be able to add to that list. It’s the definition thatis here and any regulations related to the definition thatis here, notadditionalpieceswhere it may be decided regulations are needed. So it’s limited by the dwelling property definition.

Section 89 approved. On

section 90. [1:55 p.m.] S. Bond: I understand that this is consequential to the amendments. I’m just interested in…. Maybe the minister could explain the context. We’re talkingaboutsection 90, referringto the SchoolAct,

section 119. What is the purpose of striking out the word “school”? In fact, it also takes out “school taxes underthis Act.” We’re creating a differentframework here. Also, “sub- stituting ‘taxes under this section’” and striking out “each class of property.” Could the minister explain to us what exactly

section 90 is doing? Hon. C. James: Basically, what we’ve done is created a new section, a separate

section to dealwith the additional school tax, and cleaned this one up to deal with the cur- rent school tax. These amendments make no changes to the existing schooltax. The terminology has changed so you can distin- guish this section, with the existing schooltax,from the new section, with the new schooltax. We feltitwas importantto make sure that the

definitions were clear for people. The

definitions of “variabletaxrate system” and “property class,” forexample, whichapplied only to the existingtax,are moved into this

section — again, to make sure thatthis sec- tion is clear, thatit’s talkingaboutthe existingschooltax.The new

section talks about the new school tax. Sections 90 and 91 approved. On

section 92. T. Redies: This section, of course, deals with the imple- mentation of the new school taxes. So we’re going to have some broad observations as well as some questions for the minister. I know there was a little bit of a discussion yesterday about what m odelling the government does to determine the impact of som e of its decisions. I think we got to a point where the minister confirm ed that they actually do analysis and m odelling ahead of justbringing forward their taxes.

What I would like to hear from the minister is actually what analysis has been done in advance of the budgetto determine the impactof this schooltax increase in conjunction with allof the othertax increases thatwere announced with this budget. [2:00 p.m.] The FinanceMinisteris on record as having said thatshe wouldlike to see the housing marketgo down. I guess what I’m trying to understand is…. Exactly whatare you predict- ing willhappen with these tax increases, particularly in the context of your 30-point housing strategy?

What are you expecting to have happen in terms of the housing market, particularly around prices and affordability? Hon. C. James: Just to, once again, make sure that the record is clear, I have certainly said thatI hope thatwe see more affordable housing in British Columbia. I have cer- tainly said thatI hope we see a moderation in the market.I think that’s going to be critical in our housing market. As we look at the analysis of our 30-point plan, as we look at the m easures that we’re putting in place, we’ll be continuing to look ata numberof indicators to track over the coming year.

Vacancy rates, obviously, is one of those critical pieces. Foreign ownership is another piece that we’llbe tracking in ourprovince. House pricesis another piecethatwe’re going to be tracking — construction num- bers, developm ent in British Columbia. That’s just an exampleof the kinds of indicators that we’re going to be tracking as we go along. Certainly, as I said, I do hope we see a moderation in the market.I dohope thatwe see more affordablehousingin our province. We believe thatthis is one measure thatwill, again, provide supportfor a numberof the othermeasures in our 30-point plan. T.

Redies:Maybe I was notclearenough in my question. What I’m asking is: what analysis was done before you broughtthe budgetforward with respectto the totalnumber of these taxes on the housing market?I presume thatthere was some analysis made, and I’d like to understand whatthat analysis told you. [2:05 p.m.] Hon. C. James: I think this is a repeatof ourconversa- tion yesterday — I think itwas yesterday; I’ve losttrack — around the number of m easures that influence what will happen in the housing m arket.Certainly it’s why, as I said yesterday, we took the time to puttogethera comprehens- ive housing strategy.

We analyzed notonly the taxmeasures butthe supply and demand measures — allof the measures thatare withinour housing strategy. We believe the mix of measures that we have provided willmove in the direction of, as I said, mod- erating the market,providing more affordablehousing and creating that balance. Whenitcomesto the impactthatoccurs afterthe taxesare in place, as I mentioned in the discussion yesterday, thatgets Tuesday, March 13, 2018 British Columbia Debates 3435

builtinto oureconomic modelling. Oncethey’re in placeand once those taxes have been passed or become part of the budget,thatthen becomes partof the economic modelling thatthen looks atfirstquarter, second quarterand building into next year’s budget. T. Redies:I think I understand the process now, butwhat I’m not hearing is an answer to my question. The minister has indicated — actually, even indicated yesterday — thatwe do economic modelling, obviously. We take a look atimple- mentingand dothe modellingof new taxescomingin. I pre- sume thatthey didthatwith the schooltaxand the property transfer tax.

What I’m asking is: what did that analysis tell you, par- ticularly in lightof the othertaxes thatyou were looking at implementing with this budget? Hon. C. James: I come back again…. I know the member and hercolleaguedidn’tagree yesterday around supply and demand. Again, when itcomes to measures, ouranalysis when we took a look atthe percentage of homes in British Columbia thatare impacted, when we took a look atthe formula that we used to put together this tax, we believe it’s a modest rate. We believe thatitwillgenerate revenue thathelps with affordability.

We feltthatitwas a measure thatcouldbe implemented and that along with the other measures being put in place around supply and demand, that’s going to have a positive impact on affordability of housing for families. S. Bond: Well, thank you very much, Minister. We appre- ciate the comm entary. However, budgetsaren’tbuilton feel- ingsand thinkingaboutwhatmightormightnotbe putin at some laterdate. Justweeks ago the ministertabled a budget in this House and projected revenue attached to a whole seriesof new taxes.

I find itquite implausiblethatthere were notassumptions and modellingthatactually generated those numbers. Let’s see if we can getto an answerthatspeaks to us about exactly whatassumptions were madein terms of the reven- ue, the impactson British Columbians, the fact that when it comes to developing a project in British Columbia now, there will be taxes levied at three different times, with the impacts being felt by British Columbians.

What we’re trying to do here is understand the assump- tions thatwere madein the budgetand how the revenuepro- jections, which are captured in a budgetthat was tabled in this House, were arrived at. [2:10 p.m.] Hon. C. James: As the member knows, there is analysis done on all changes that occur and certainly when you’re looking at tax changes. Analysis was done on the revenue that could be generated on the various measures that we are looking at — on the number of individual homes or homeowners ordwellingsthatwere going to be impacted by the various taxes.

All of that was analyzed to arrive at the decisions around which measures were going to be utilized and which measures were not.Thatwas achoice, as italways is, by governmentand by cabinet.Those were the numbers that came forward. We looked at the revenue that wouldbe generated. We looked atthe revenue stream s. We looked atthe impacton the households and the numberof households for each of the various m easures, including whethera householdwas impacted by one ortwo m easures.

We looked atoursupply and demand, ourcomprehensive housing strategy and the revenue thatwouldbe utilized to provide those program s and servicesfor affordability, and m adethe decisions that we made. T. Redies: I hear what you’re saying. I guess what I’m asking is: was there any modelling done on the cumulative impact to housing prices of the property transfer tax increase, the spec tax increase, the school tax increase, the EHT? If so, whatwas the impactgoing to be on the housing marketto make itmoderated or more affordablefor British Columbians? Hon. C.

James: As I’ve said overourcoupleof days of dis- cussion, a coupleof these measures, as the memberknows, are new, including the speculation tax. That is something new and bold, a boldmeasure thatwe are bringing forward in British Columbia. As we bring ourcomprehensive hous- ing strategy forward, we willbe analyzing itas we go along.

We wouldn’tpresume to predictanew impact.We certainly, as I said, believe thatallof ourmeasures taken togetherwill have an impacton affordability and housing, both in supply and demand. [2:15 p.m.] Those are the big areas, as I talked about yesterday, that certainly we have beenencouraged to move aheadin, wheth- eryou’re talking abouteconomistsorresearchers orprofess- ors in the area of housing or individuals’ recomm endation. To move, in abroadway, on those issuesis whatwe are look- ing at and coming forward with. We will be continuing to analyze, as well, all of the outside factors.

I think we also have to remember that there are outside factors thatimpactthe housing market— interestrates, the changes thatwere mademortgage-wise atthe federallevel. It’s notsimply an analysis of ourmeasures.Those are critical, and we are going to analyze those as we go along. As I said, they willbecome partof the economic model. Therefore, we’llstartgetting that,in firstquarterand second quarter. It’llgive us achanceto be ableto dothatkind of ana- lysis that’s needed.

We will also be tracking, at the same time, the kinds of changesthathave beenmadeon the outsidethatalso have an impacton the housing market— to be ableto make sure if there are changes thatneed to occuroradditionalmeasures that need to be put in place. That’s what we’ll be looking at. 3436 British Columbia Debates Tuesday, March 13, 2018

We certainly don’texpect,as we look atthe housing mar- ketfive years from now, that we might not need some dif- ferentkinds of measures ordifferentapproaches. We believe thatthat’s why we’re bringing in along-term, comprehensive strategy. One measure isn’t going to address the housing affordability crisis that we have in placenow. It’s going to take a number of measures. It’s going to take real analysis of those measures as we go ahead, as we bring them in, and that’s what we plan to do. T.

Redies:I think whatyou’re telling me is thatyou actu- ally don’t know what the cumulative impact of these taxes on the housing marketis, which is incredulous to me — that you wouldnot have some idea as to how these various tax measures thatyou’re taking are going to impactthe housing market. Am I correct or not? Hon. C. James: In fact, the analysis that is done…. As I said, we analyze each tax as we’re looking to bring it in, or a housing change that we’re looking to bring in. That is analyzed. We certainly believe, and ouranalysis shows, that we will see upward pressure around vacancies.

But if you increase supply and demand — looking back, again, to sup- ply and demand — we willsee downward pressure when it comes to foreign ownership. And we willsee a moderation on housing prices. That is what our analysis shows. If the memberis looking for a percentage or pricepoint thatwilladjust….I think, again, as I mentioned earlier, we are looking atboth ourmeasures thatwe are putting in place and external pressures that impact the housing market.So we are notsetting a particularpriceora particularpercent- age. We are going to dothatanalysis month by month.

That’s going to be critical as we look at our plan. Certainly, the analysis, as I said, thatwe showed…. That’s why we took our time to do a comprehensive housing strategy. It was to make sure that the measures that we broughtin hadbeen looked ataround how they willimpact vacancies,how they willimpactamoderation of prices,how they will impact foreign ownership in a way to address affordability for British Columbians. [2:20 p.m.] S. Bond:The ministersuggeststhatthere’s beenan analys- is and thatit’s going to begin to dealwith the issue of afford- ability.

There are significantnumbers of builders, peoplewho are going to be partof the solution in terms of the housing and affordability challenge in British Columbia, expressing significant concerns and, obviously, not having had input previously. In fact, when you look at the property transfer tax, the foreign buyers tax, the schoolproperty tax and the yet-to-be-defined speculation tax,this willaddto the costof residential building in British Columbia. Has the minister considered what the impacts of the layered-on levels of taxation forbuilders in British Columbia will do?

How will it impact British Columbians directly? Hon. C. James: I know we hadthis discussion yesterday, butI’m happy to have itagain. That’s partof the reason we put the comprehensive plan together. Yes, we have been listening to developers. Yes, we have been listening to co-op housing. Yes, we have been listening to faith groups and comm unities. Yes, we’ve been listening to individuals and organizations that work with homeless people. Yes, we’ve been listening to peoplewho are strug- gling to find housing.

We, in fact, have been spending the fall consulting with allof those individuals, which is why we came up with the 30-pointplan thatlooks ataddressing supply and demand. Yes, we factored in the impactof allof the 30 pointsin our plan and the impact that they will have. We believe that a comprehensive approach is actually going to address supply and demand, which is going to address affordability in our province.

Whether we’re talking about the housing hub and the partnerships that we’re looking at; whether we’re talking aboutthe revitalization areas and the opportunity to waive the school tax in those areas for developments,for rental- built housing; whether we’re talking about the money that we’re putting in for purpose-built rental housing — all of these measures are measures that,again, we have been hav- ing in discussion with housing groups, faith groups, developers and the private sector about how we can make sure that affordability is addressed. T.

Redies:Minister, I’m sure, with allthese conversations that you’ve been having, that none of the residential developers said: “Please taxus more so we can help you.” I’m sure that’s the case. I’m pretty sure they wouldn’tappreciate the employers health tax, either, as a way of making iteasier for them to put more supply out there in the marketplace.

In fact,actually looking atsome of the statisticsthatUDI has given us, on a $30 million property with about 80 units….I think everybody in this chamberknows how long it’s taking to get residential property permits through the various municipalities— anywhere from ayearto five years. [2:25 p.m.] Looking atthe costsof the additionalschooltax and the property transfertax, which my colleaguehas already noted getsapplied three times in thatprocess, itwouldaddclose to $2 million onto a project— the schooltaxes and the prop- erty transfer tax — which, if divided by 80 units,is about $25,000 perunit.Thatis before the employerhealth tax and the doubling up of the MSP in the one year are applied on these residential properties.

How is increasing the end-unit prices of condos and townhouses by $25,000 ormore a unitgoing to make things more affordable for British Columbians? Hon. C. James: We’ve hadthis conversation. We can con- tinue to have this conversation. I will continue to raise the 30-point plan that we have. That is a comprehensive plan that approaches a number of different areas that we have Tuesday, March 13, 2018 British Columbia Debates 3437

looked at: increasing development, purpose-built rental housing to provide affordability. We have talked about the work we’re going to do through the housing hub with developers, with the private sector. We believe this is action thatis necessary, thatis needed and thatwillbegin to address the crisis. It’s certainly not going to address it overnight. There is no question aboutthat.Butwe are going to continue to act in a way thatBritish Columbians expectus to and, in fact, elected us to. S.

Bond: The people of British Columbia also elected this governmentto lay outa budgetand be ableto explain how the targeted revenue numbers are in the budget.Over the last number of days and weeks, we continue to hear that, yes, there are revenue targets,but by the way, we’re going to look at exemptions. We have room for this. We have room f or that. The questions we are asking today as Finance critics for the opposition are simply to have the ministerexplain the m etrics with good solidbudgetplanning.

We are presen- ted with a budget document that has revenue targets in it,yetthe ministerhas been unableto explain, otherthan pointing to a 30-pointplan, exactly how thatrevenue tar- get was generated. Subsequentto that,we hearthis afternoon thatapparently, atsome pointduring the day, the Premierhas madeitclear that oh, yes, there’s room to fix all kinds of issues. In fact, some of the taxes might get fixed before the end of session. I think British Columbians also want to know how this budget was put together.

Onceagain to the minister: when we look atthe assump- tions and the layering on of taxes and the cost to British Columbians aboutmultilevels of taxation thatwillbe applied to building units….We now have the schooltax increasing on those properties. We have the property transfertax. We have all of these taxes. What numbers can the minister provide to us that would explain how the revenue targets were generated and how on earth there is now any sort of credibility with the numbers that have been presented? Hon. C.

James: I’ll say again to the member across the way that the memberhas the budget.The memberhas the numbers, as allBritish Columbians do, on the revenue that we expectto come in on the taxes and the various measures in the budget.They are listed in the budgetdocument.They are done.

As I talked about,the analysis has been done on each of those tax measures, taking a look at the number of dwell- ings or the numberof houses or the land that’s going to be impacted; takingalook atthe ability forthose developments; taking alook atthe ability fortheirhomeowners orvehicles, if we’re talking aboutvehicles.If you look atthe range of tax measures in here, the ability forthose individuals to be able to contribute towards affordablehousing for the peoplein British Columbia…. I wouldcorrectthe member, again, when itcomes to the speculation tax.

The member knows that I said on budget day thatdetails wouldbe coming, thatwe wouldbe finalizing the details, that we would take our time to finalizethose details, thatwe wouldtake alook atthe issuesthathave been raised and that we would bring forward the specifics. [2:30 p.m.] The legislation willcom e in the fall. The specifics,as I’ve said, will com e later in the spring. Those details will be coming. I’ve m entioned that.I can say itin a differentway forthe m ember, butthat’s the answerthatis there, because that’s the fact. T.

Redies: If the goal is to try and create more supply and more affordablehousing — I’ve justmentioned thaton a $30 million, 80-unit project, you’re going to add at least $2 million in costs on school tax and the property trans- fertax alone — why notgrandfatherthe existing residential developments underway in Vancouver? Hon. C. James: I appreciate the memberlooking atwhat she believes wouldbe a way to address some of these issues, butI think grandfathering, orgrandparenting, wouldcreate a two-tierdevelopmentsituation. I can think of allkinds of complications that would be addressed there.

We believe thatthe comprehensive approach — allof the measures, when taken together — will address supply and demand. Both of those pieces need to be addressed, we believe. We don’t believe there’s going to be one measure that’s going to make orbreak it.We believe the changes we’re making on the schooltax and the changes we’re making on the property taxare going to bring in revenue thatwillassist withaffordability and spuron furtherdevelopments.And we believe that that’s going to assist the market. S. Bond: To pursue my colleague’s line of questioning, which I very much appreciate….

While the minister assumes,hopesand is crossingherfingers thatitwillactually do what is being suggested it would do, people who have expertise in residential building in Metro Vancouver have expressed significant concerns. In fact, the minister would be well aware of the concerns that have been sent to her which suggest that tax increases that are significant, which they note, willhave the unintended consequence of further undermining housing affordability.

We have expertswho buildin Metro Vancouver, we have projections of additional costs that work their way down to the purchaser, and the very peoplewho the minister is expecting to assist on the supply side have expressed sig- nificant concerns. Did the minister and her staff look at the impacts of tax increases, particularly on development sites in Metro Vancouver, and considerthe unintended con- sequences of the impacts on housing affordability? The Chair: The Minister of Finance. 3438 British Columbia Debates Tuesday, March 13, 2018

Hon. C. James: Well, thank you very much, Chair, while you change shifts. [R. Chouhan in the chair.] Yes, I’ve been hearing the concerns, and I’ve been hearing the praise. I’ve been hearing the issuesthathave been raised, and I’ve been hearing the encouragement for the direction that we’re taking. Whenever you make change, there are people who are going to agree; there are people who are going to disagree.

The importantfactorhere is looking ataffordablehousing and making sure thatwe’re doing the analysis thatneeds to occur, making sure thatwe are continuing to take a look at the market,continuing to look at affordability for families. That’s the key here, and I will agree to disagree with the member. T. Redies:I’m justlookingatpage 89 of yourbudgetbook. Yourministry is actually expecting residentialhousing starts to falloverthe nextthree years, from 32,000 unitsin 2018 to 29,500 units,in the medium term. Whataboutthis strategy is increasing supply? It certainly doesn’t look like it. [2:35 p.m.] Hon. C.

James: The member is correct. We do expect a moderation from the extremely high levels thatwe saw the previous year thatin factdid notaddress affordability. That was the challenge. If you saw the extreme housing num- bers thatwere being built,itwas notaddressing affordability. Those were notaffordablehouses. So, yes, we expecta slight moderation, stillwellabove the historicalaverage, continu- ing to be above the historical average. Included, as well, in that

section of the budget, as the memberknows, is the factthatwe expectthe average house price to moderate. We believe those measures, again, are addressing supply and demand, are addressing the more affordable demand and supply that are needed and, taken together, willmake sure, as I said earlier, of moderating the market, providing affordability for people. S. Bond:I wantto go back to the question and the discus- sion around modelling. Often when governmentsare look- ing attheirbudgets,they contemplate the cumulative effect of impactson familiesand individuals.

In fact,I know cer- tainly we wouldtake the opportunity to look ataperson with a particular income. Itmightbe a singlesenior. Itmightbe a couplethatwere seniors. There is a lotof modelling, and assumptions, in terms of how you put the budget together. When itcomes to the schooltax, I wouldlike to ask the minister if, in the analysis…. Although I get the distinct impression this is tax first; analyze later. We’re certainly seeing adjustments.

There’s going to be tweaking taking placealloverin the nextlittlewhile, as Brit- ish Columbians have spoken out,especially abouttaxes that were not supposed to apply to them. “No British Colum- bians,” we were told, but lo and behold, there are British Columbians. Let’s look atextraschooltaxes. Let’s look atthe factthat there are peoplewho live in Vancouver— and elsewhere in the province, butparticularly in Vancouver— who happen to own a home, a Vancouverhome thatwas purchased dec- adesago. Through no faultof theirown, the value has gone up.

Thatperson, thatfamily, those individuals, may be living on a fixed income. So they mightbe described as assetrich. They have a very valuable asset. Did the minister do modelling when she made an assumption about them being able to handle additional schooltaxeswhen they live on afixed income? Was thattype of modelling done? [2:40 p.m.] Hon. C. James: Certainly, consideration was given to peoplewho may be living in homes thatthey boughta long period of time ago. Those are problems now. Those are issues now for individuals.

That’s why — I know the previous governmentlooked at this as well— you have the ability forpeopleto look atdefer- ring their taxes. If they are in years where they have low income or years where they have smallchildren, dependent children, they have the option of deferring theirtaxes when they have an assetthatmay be worth more than $3 million, as we’re talking about in this section. Those supports are available.

But we felt, overall, that bringingin the additionaldollars forpeoplewho own homes worth $3 million or $4 million or $5 million, when they’re sitting on that kind of asset,was reasonablewith the sup- portsin place, as I said, for individuals, for seniors — indi- viduals with dependentchildren and seniors — to be ableto look atthe deferment,if they hityears where they’re notable to pay their taxes. S. Bond: Well, I think that this afternoon we’ve just walked through what is a significant difference with the way that we believe that budgetsneed to be built.

I think whatis becoming abundantly clear, notjustin this Legis- lature butin ourprovince, is the factthatthere has been a lack of m odelling. I mean, I’ve been here along time, and I can tellyou there are processes, there are models, and there are assumptions thatneed to be checked and made. In fact,the ministerhas talked abouthow this is aboldplan. This is aplan thatpoten- tially lowers the value of equity thatpeoplehave earned in their most valuable asset, their home.

From that, the minister has extrapolated that by doing that,somehow, by layeringon taxesto those very peoplewho she will be expecting to help build on the supply side — layered on levelafterlevelof taxation and the concerns that have been expressed by builders in British Columbia…. We cannotmake ourcase any more clear. We believe that there has been a lack of modelling looking at the assump- tions. In fact,the very plan thatwas tabled in this Legislature Tuesday, March 13, 2018 British Columbia Debates 3439

has the very real possibility of actually — hopefully, they were unintended consequences— enhancing the affordabil- ity crisis. Whilewe’ve appreciated the collegialdiscussion here, this is about numbers; it’s about facts.But it’s about familiesin British Columbia. [2:45 p.m.] First we heard British Columbians were out of the tax. Now they’re in the tax. Now we’re going to fix the tax. We have no ideawhatthe basicassumptions thathave generated specificrevenuetargetsin this budgetare. In fact,we’re hear- ing now that they could well be changed.

We justwanted to clearly be on the record thatwhen you look atthe combination of taxes,includingthe schooltax,on peoplewho may wellhave significantassetvalue, who may wellhave limited incomes, there willbe an impacton British Columbians. We’ll leave it there. If the minister wantsto lay out any more numbers or factsor details, that wouldbe helpful to demonstrate thatthere has been the kind of modelling that British Columbians expectbefore those costsare passed on to them. It’s one thing to deal with taxation when it comes to people’s earnings, butwe’re now taking a run attheirassets.

We’re now taking a run at theirproperty. The wholehope, cross our fingers, is that somehow it’s going to help the affordability issue and the availability of housing in British Columbia. We respectfully disagree with that. I think that the discussion over the last coupleof days has m adeitvery clearthatthere is very littlespecificdetail availableto be ableto assure British Columbians that the budgetthatwas tabled here and thatthis billbrings to life has the kind of m etrics and m odelling and assumptions that shouldbe m adewhen bringing a budgetforward for British Columbians. Hon. C.

James: We will respectfully disagree, Member, particularly around the analysis that continues to be done. Whatis clear, I wouldsay to the member, is that,yes,we have differentpriorities. There is no question aboutthat.We, on this side of the House, in government, believe in address- ing affordability in housing. We believe in taking some bold measures to do just that. We continue to analyze the information thatis there. We continue with the rigour that has always been there with the staff in the Ministry of Finance, who continue theirfine work.

I will take umbrage with the member’s comm ents around the lack of rigourthathas been done. The rigourhas been done. We have done the kind of analysis thatneeds to be there. Itis factbased, as italways has been and always will be with the fine people who work in the ministry. I recognize, from the member’s discussion thatwe’ve had, that the member does not agree. That is the member’s prerogative — to disagree with the actions we take on hous- ing. That’s why we have a legislature, why we have demo- cracy, why we have an opportunity to debate this. The mem- bers will disagree on action around housing.

We believe that’s an importantpriority, and we willcon- tinue to move ahead on affordability on housing. We will continue to analyze the work that’s been done. We willcon- tinue to listen to British Columbians. When they believe that there are areas that need to be adjusted or need to be addressed, we will continue to do that, because that’s what the public expects. The publicexpectstheirgovernmentto listento them. The publicexpects their government to act on the things and the commi tmentsthatthey hadmade. We commi tted to act- ing on affordablehousing.

We are following through on that commi tment.Willthere be changes thatwillbe needed over the next year, in two years? Yes, I expect so. Housing is an issue, as I said, thatdeals with supply and demand, thatdeals withthe issueof outsidefactors. I am cer- tain thatthere willbe changes thatneed to be made. That’s partof ourjob — to make sure we do thatanalysis and we make the changes as they’re necessary.

Section 92 approved. S. Bond: We’ll give notice to the Chair that we have no further questions to the end of the bill. I do want to reflect on the minister’s final and closing comm ents.She wouldvery wellknow thatmy comm entsor any of ourcomm entswere notatallrelated to the publicser- vice in British Columbia. Having spent 16 years in various cabinetpositions, I fully understand how this process works and the exceptionalnature of the publicservicethatworks in this province. On thatnote, we wantto extend ourthanks to the staff for the briefingsthatwere provided.

Though shortand complex, the time was very much appreciated, as was the time here in the Legislature. Sections 93 to 117 inclusive approved. Title approved. [2:50 p.m.] Hon. C. James: Thank you to the critics for their very good questions. Partof the realstrength of democracy, as I said, is having an opportunity to have good, strong debate, agreement and disagreement, on these taxes. I thank the members for their questions. I particularly thank the staff in the Ministry of Financefortheirincredible work. This is a very large bill, as we’ve talked about, and I want to express my appreciation.

With that,I move thatthe commi ttee rise and reportthe bill complete with amendments. Motion approved on the following division: [2:55 p.m.] 3440 British Columbia Debates Tuesday, March 13, 2018

YEAS — 43 Kahlon Begg Brar Heyman Donaldson Mungall Bains Beare Chen Popham Trevena Sims Chow Kang Simons D’Eith Routley Ma Elmore Dean Routledge Singh Leonard Darcy Simpson Robinson Farnworth Horgan James Eby Dix Ralston Mark Fleming Conroy Fraser Chandra Herbert Rice Krog Furstenau Weaver Olsen Glumac NAYS — 40 Cadieux de Jong Bond Polak Wilkinson Lee Stone Coleman Wat Bernier Thornthwaite Paton Ashton Barnett Yap Martin Davies Kyllo Sullivan Isaacs Morris Stilwell Ross Oakes Johal Redies Rustad Milobar Clovechok Shypitka Hunt Throness Tegart Stewart Sultan Gibson Reid Letnick Larson Foster The commi ttee rose at 2:58 p.m.

The House resumed; Mr. Speaker in the chair. Reporting of Bills BILL 2 — BUDGET MEASURES IMPLEMENTATION ACT, 2018 Mr. Speaker: When shallthe billbe considered as repor- ted? Hon. C. James: Mr. Speaker, with leave, now. Leave not granted. Bill 2, Budget Measures Implementation Act, 2018, reported complete with amendments, to be considered at the next sitting of the House after today. [3:00 p.m.] Hon. M. Farnworth:I call, in this chamber, the estimates of the Ministry of Forests,Lands, NaturalResource Opera- tions and Rural Development.

Commi ttee of Supply ESTIMATES: MINISTRY OF FORESTS, LANDS, NATURAL RESOURCE OPERATIONS AND RURAL DEVELOPMENT The House in Commi ttee of Supply (Section B); R. Chouhan in the chair. The commi ttee met at 3:05 p.m. On Vote 28: ministry operations, $473,452,000. Hon. D. Donaldson: I’lljuststartoff withafew briefcom- ments.We have lotsto cover. It’s a big, big ministry, and we wantto getallof the questions thatmembers wantto ask on behalfof theirconstituentsand on behalfof everyone in the province.

I’d justlike to introducethe peoplewho are assistingtoday and throughout the next number of days: Tim Sheldan, deputy minister with the ministry; Trish Dohan, ADM of corporate services; Sarah Fraser, the executive director of ruraldevelopment;Dave Peterson, ADM withruraldevelop- ment,lands and innovation; Rick Manwaring, ADM, south area. Given the size of the ministry, we’llhave a lotof staff over the course of this estimates debate. I justwantto say a coupleof brief comm entsto startoff.

We became governmentjustten days aftera state of emer- gency was declared around the wildfires.The enormity of the wildfire event is still settling in to government and to the MLAs in this room who represent areas impacted by that. Those impacts will go on for a number of years. Itwas the longeststate of provincialemergency on record, more than 65,000 peopledisplaced and 1.2 million hectares burned. There was a lotof directwildfire cost— $548 mil- lion spent. However — we’ve said this before, and I know members in this House always wantto recognize this — not one life was lost as a direct result of the wildfires.

I think that’s atribute to the Wildfire Servicepersonnel, comm unit- ies, non-profits and volunteers. I’m notgoing to go into details of Budget2018 because I know we’llbe going through thatin the budgetquestions, just three or four highlights. So $72 million is additional funding, commi tted overthree years for wildfire recovery and to build comm unities’ resilience to wildfires, in this budget. An additional $16 million over three years has been commi tted in this budget to land use planning, $14 million over the next three years to improve wildlife m anagement.

And in rural developm ent, the rural dividend funding of $25 million per year has been exten- ded to 2020-2021 in this budget. I know thatthe criticand the members willhave anumber of questions around those upliftsto the budget. So with Tuesday, March 13, 2018 British Columbia Debates 3441

those opening comm ents, I’ll let the questions proceed. J. Rustad:To the staff, I just want to recognize the staff and thank them for theirwork and theirdedication to the work that’s done around the province. I know this pastyear has beenavery challengingyear, especially withthe wildfires and the floods and allthe challenges — the switching over of governments,all the issues that come with that. I know the ministry has done a professional job, as it always does through these sorts of challenges and work. I look forward to the nextfew days thatwe have in terms of going through the estimates process.

There’s a lot of materialthatwe need to coveroverthe course of this period of time. I understand thatthere may be some change of staff. [3:10 p.m.] Whatwe’lltry to do as bestwe can is to structure this as we go so thatwe can group questions, although there willbe a numberof questions thatwillcome in from my colleagues — perhaps some later today, certainly some on Thursday and maybe even some on Wednesday — which may require some challenges as we go. I’lldomy bestto try to coordinate through the various topics that we’ll go through. Just as a note.

Because of the Minister of Agriculture recusing herselfforthe issue of marijuana, forthe questions thatwere asked in the Ministry of Agriculture, we’re hoping thatwe’llhave an opportunity to ask those questions, poten- tially today, if you have the staff available. If not, those are things thatwe couldmove into a discussion tomorrow with the appropriate staff. To start with, as we work through today, the intent is to work on ruraldevelopmentfirst.We have anumberof ques- tions, and my colleague from Cariboo-Chilcotin will lead those discussions around rural development and the ques- tions that’llcome.

There willbe a few others thatwillcome in to have questions around thatas well. There willlikely be some overlap between those questions and otherfunctions within the ministry, butit’s in the contextof ruraldevelop- ment through that. We’llthenmove on. Hopefully, we’llbe ableto canvass and spend ashortbitof time, I suspect,on the issueof marijuana, and then go into fish farm tenures and perhaps a few other topicsif we gettime to today, before focusing on the meatof the estimates, on forestry and otherissuesgoing into tomor- row.

I’m sure there’llbe anumberof otherquestions thatwill come withregards to the budgetand canvassingthe amounts that the minister had mentioned, as well as the amounts from the budget. At this time, I will take my place and turn it over to my colleague from Cariboo-Chilcotin to start off with the budget debate on rural development. D. Barnett:I’d justlike to say a few words aboutthe rural strategy that was put together by the previous government and the work thatwas done to create aruralstrategy, which I believe was the firsttime in British Columbia. I’d like to rec- ognize the staff that is here with you today.

Many of them participated in the strategy that was put together, worked very hard and understood what rural economic develop- ment really and truly is. The strategy thatwas puttogetherwas builton work that began in 2014 with the release of Supporting Rural Devel- opment from UBCM. The pine beetlecoalitions put a doc- ument together called A Voice for Rural British Columbia. It was a great document. It took them a coupleof years to put it together, all working, the coalitions, throughout — SIBAC, which is the Southern Interior BeetleCoalition, the Cariboo-Chilcotin BeetleCoalition and the Omineca Beetle Coalition.

It created a voice for rural British Columbia. It artic- ulated government’s promises to rural B.C., including a commi tm ent to give rural comm unities a stronger voice and opportunities to develop localsolutions to m eettheir specific needs. Many of the actions in the strategy that we put together are based on advice and feedback from the rural advisory council, which was 13 citizens from across this province, some in localgovernment,some in economic development, some in industry and some citizens.

Government built on the success of the council, which broughtforward new ideas to supportbusiness owners, leaders, workers and families.It continued, day in and day out, to come forward with new ideas thatwe couldcreate jobs, notjustbuildthingsbutkeep people working after what they were doing was built. Now I see the ministeris putting togethera new strategy. The strategy was on line for 28 days. There were meetings heldin afew comm unitiesof the province, and by invitation only to attend these meetings. I find this is notvery collab- orative. I find itis notopen.

In the on-line comm ents,I see there were 351 hits only. The 13 members of the pastadvisory councilspentmany, many hours in theircomm unities bringing forward sugges- tions and solutions. [3:15 p.m.] It frustrates me, and it frustrates many people to see a program — and a document called building on our rural strategies — thattook time, energy and many, many dollars of staff and others now going to be puton the shelf. I under- stand thatthe new ruralstrategy is going to be based more on social programs than economic development.

My first question to the minister is: could you please explain to me what the new strategy is going to look like, whatthe new strategy willentail, who is going to puttogeth- erthe strategy and how itwillbecome a strategy thatreally and truly has economic developmentfirstand jobs forfam- ilies, not just social programs? Hon. D. Donaldson: Well, we want to thank the work thatthe ruraladvisory councilcompleted underthe previous government, and we want to buildon that work. We have been visiting comm unities with our engagement process over16 face-to-facesessions thathave been heldacross the province.

Over 400 people have attended those sessions. 3442 British Columbia Debates Tuesday, March 13, 2018

We’ve also had over3,000 visitsto the engagementwebsite around rural development. We’re a new government looking at a new strategy. We look at it in a holistic fashion, both social and economic factors driving the economy of small, rural comm unities. That’s the way it shouldbe. We’re basing it on principles of comm unity economic developm entand those five prin- ciples of self-reliance, asset-based, sustainability, com- munity-based and participatory.

I especially want to emphasize the participatory element, especially when it com es to the focus of this government on Indigenous inputs early in a process, which is being accomplished through our engagement process. As faras whatthe strategy willentail, well, we’re justwrap- ping up the engagementprocess. We’llbe putting togethera reportthatwillbe availablepublicly as faras whatwas heard atthe engagementsessions, whatthe themes are. That’s what we do. We listen to what the people have to say.

I’m not going to presuppose what that report will say, because it’s coming directly from the peoplemostimpacted, from people in rural comm unities. We’ll be seeing that report very soon. D. Barnett:I thank you, Minister, for youranswer, butI will make another comm ent, Minister. When we did our rural strategy, it was done by many, many, many people throughout the province of British Columbia.

It was certainly done with the interests of eco- nomic development.Some of ourbestproposals, if you look through the filesand if you look through those that were awarded ruraldividend funds, came from ourFirstNations comm unities. They were such good proposals. The amount of jobs and innovation that have been created in our First Nations comm unities because of the past rural dividend is amazing. They are carrying forward with this.

I take a look at som e of the new announcements that have been m ade recently for rural developm ent, and I would ask: are you using the sam e criteria that was put there by the previous government, or have you changed som e of the benchmarks? Hon. D. Donaldson: I justwantto say thatI agree with the comm entsaround the focus and the need for attention to ruraldevelopmentthatthe memberhas laid out.Justas a littlebitmore information, one of the themes thatis arising from the engagementprocessesis the need forthose livingin ruralcomm unitiesto access investmentdollars, access capit- aldollars.

That’s somethingthathas come up again and again in our engagement sessions. Also, an overriding theme that’s come up is the need for our government to continue on our journey with imple- menting the United Nations declaration on the rights of Indigenous people. This is seen as aruraldevelopmentissue, and the themes are coming up. Of course, supportby gov- ernment for rural development is a theme that’s come up on the ground and in comm unities.

Those are the kinds of themes that we’re looking at that this report will outline. [3:20 p.m.] As far as the reinvesting in rural comm unities, we are definitely reinvesting in rural comm unities. I gather the m ember’s question is around the criteria for the rural dividend fund — the $25 million peryearthatthis budget allocates for the nextthree years, so $75 million. The cri- teria have not changed. D. Barnett:Thank you for that answer. Back to ruraldevelopment.Willthere be a new advisory council? If there will be, how will the council be chosen? Hon. D. Donaldson: Again, I’m not going to speculate.

The reportwillbe outsoon. The peoplewho participated in the extensive engagementsessions have maderecomm enda- tions around how they wouldlike to see ruraldevelopment inputorganized in relation to adviceand strategies and co- development of policies with the government. D. Barnett:Maybe it’s nottrue, butwe have heard thatthe new ruralstrategy willbe one thatwillonly be includingloc- algovernmentsand FirstNations, thatcomm unitiesoutside of localgovernments— independentpeoplewho have soci- eties, who have organizations thatcreate many jobs in rur- alBritish Columbia — willnotbe included in the new rural strategy.

Is this going to be the case or not, Minister? Hon. D. Donaldson: Thatwillnotbe the case. There have been key informantinterviews conducted, as well, with over 50 key informantsand key stakeholders interviewed fortheir knowledge, expertise and experience in ruraldevelopment. Some of the organizations that the member is alluding to, ones that don’t include local government or First Nations, have been key informants in the process so far. D. Barnett:Thank you, Minister. You’ve putoutthe fourth phase of ruraldevelopmentpro- jects.Have they allbeen announced?

When we didthe rural developmentprogram on this sideof the House, itwas one of ourobjectives to make sure thatthe opposition MLAs knew when projectswere coming to theircomm unities.Willyour ministry keep the opposition MLAs informed as to which projectswillbe delivered to theircomm unities?As of today, for the last round, we have been told nothing. Hon. D. Donaldson: I’m very happy to discuss the results of the fourth intake so far.

The fourth intake for the rural dividend fund closed December 15, 2017: 71 applications from the project development funding stream were announced, for a funding totalof $693,678, and 28 project awards for wildfire-impacted comm unities, including spe- cial circumstance requests, for a funding total of $3,809,518. [3:25 p.m.] The rest of the projects that will be allocated funding under this fourth intake will be forthcoming quite soon. Tuesday, March 13, 2018 British Columbia Debates 3443

Definitely, we willendeavourto ensure thatMLAs in whose constituenciesthese funding awards have been allocated will get a heads-up. D. Barnett: Thank you, Minister. So far that has not happened. We have found outby goingto the mediaforwhat is happeningin ourcomm unities.We certainly wouldappre- ciate a heads-up, as ourcomm unities also are very engaged with us on this side of the House. My colleaguefrom Cariboo North has a question, so I’ll turn it over to my colleague. C. Oakes:To the minister, first,I didreadthe press release today around rural dividend funds that were distributed. Thank you.

We do certainly appreciate the announcement, and the support is appreciated. A few questions, if I may canvass, are justfollow-up ques- tions from estimates raised around this in the fall. Formany of the comm unities or individuals that were affected, spe- cifically guide-outfitters and trappers, they were looking…. The only opportunity for a funding source, really, for these specificsectors was through the rural economic develop- mentfunding pot.We had canvassed the opportunity, per- haps, to have smallbusinessesbeingableto access funds as it correlates to FLNRO files, such as guide-outfitting territory.

Again, I reviewed the update this morning. It looks like it’s all local governments and First Nations comm unities. I didn’t see any individual announced through economic development.Couldthe ministerperhaps update us on what individuals, for example…? I’llstartwith guide-outfitters. Specifically, StewartFraser has raised on multipleoccasions that he is still waiting to hear back from the FLNRO office. The conversation started in December. The request is a continued, “We’ll get back to you. We’ll get back to you,” and we haven’t still heard.

Can Stewart Fraser and guide-outfitters expect any funds through the rural economic development strategy? Hon. D. Donaldson: Thank you for the question. It’s an importantpartof whatgovernmentis there for — to assist peopleafter, really, a natural disaster. Many guide-outfitter territories were impacted, some more severely than others. Underthe criteria thatthe previous m emberjustques- tioned on around the rural dividend, you’re right. Indi- viduals don’t qualify currently under the criteria around rural dividend.

We do have, under our socioeconomic recovery line within the ministry, ouragreementswith the Canadian Red Cross, which has funding availableforsmall businesses. They’ve handed out a substantial am ount of m oney under that category. They’re still able to consider further applications under the small business part of the Canadian Red Cross. We’re also working with guide-outfitters on options around permitting and fees and those kinds of things. So we’re open to creative thinking around this. [3:30 p.m.] C.

Oakes:One of the elementsaround the ruraldividend was specialcircumstances,and one of the thingsthatwe had canvassed in the fall was looking at how individuals may work with organizations around special circumstances. As itpertains, again, to guideand outfitters, where tenure is purchased through the province, does the minister have funds to, in fact, support purchasing back the tenures of guideand outfitters?

In particular, one of the guideand out- fitters in our area lost theirranch, lost theirproperty, lost their guide-and-outfitting territory and had to return the $80,000 worth of huntsthatthey had already presold. Now they are supposed to be doing trade shows in April. They’re waiting to hear back from FLNRO on what to expect this season. They had the significant hit from last year. They’re faced with significant challenges heading in, April1. Is there clarity? Is there support?Is there something that individuals can expect through the rural dividend? Hon. D.

Donaldson: Thank you for the specific case you’re talking about and the applicability it might have to other cases as well. Of course, on this specificcase, if you wouldlike to encourage the individualto getin touch with the ministry, we’d be happy to meet with them about the challenges they’re facing. Some of the questions raised deal with things like: was insurance availablefor some of the losses? That’s one of the first things that’s looked at when claims are made— were they insurableitems?

Again, with the Canadian Red Cross support to small business — they have an allocation of $29.1 million, and $6.8 million has been spentand commi t- ted so far. So there’s stillavailability through thatline. We’re also looking at, with some affected guides,for them to be able to provide hunts outside their guiding area. I wouldencourage the m emberto ask the individualto getin touch with us directly, and we can explore options. The option of purchasing back guiding territories has not been put on the table, as an option, to Treasury Board at this point. C. Oakes:Thank you very much, Minister.

The particular case that I did identify had reached out in December to FLNRO and were asked to waituntilFebruary for a follow- up and are still waiting. Where they want to sell the hunt is clearly in the FLNRO jurisdiction, and they are trying to figure outwhat they’re going to do as of April1. If we couldexpedite that — and I know ourofficehas senta letter— thatwouldbe appreciated. [3:35 p.m.] Moving now to trappers, are trappers availablethrough the ruraldividend?

Again, when we canvassed in November, many of the filesthatwe broughtforward we were directed to putin the comm unity’s wildfire response to comm unities. Are there goingto be extrafunds announced? Lookingin the budget,obviously we didnotsee that,so I assume that’s com- ing through the rural dividend. Is there funding allocation 3444 British Columbia Debates Tuesday, March 13, 2018

or opportunities for trappers through the rural dividend? [L. Reid in the chair.] Hon. D. Donaldson: The same criteria apply that have been in placeforthe ruraldividend fund, so individuals are noteligibleatthis point.Buttrappers are smallbusinesses. Again, I direct the member to the fact that we’re address- ing smallbusinesses. One of the tools is through the Cana- dian Red Cross and the supportto smallbusiness program of $21.9 million. We are definitely exploring other opportunities, as well, with those trappers who have seen significant damage to theirtraplines through the wildfire season.

That’s something we’re doing in the short term. In the longerterm, of course, recovery and resilienceini- tiatives willensure thatthe land is rehabilitated to the state thatenablestrappers to undertake whatthey’ve done as their livelihoods. ButI fully recognizethatthat’s along-term view. In the shortterm, trappers can seek assistance through the Canadian Red Cross smallbusiness program as wellas dir- ectly with our ministry, in specificcases, to explore some other creative opportunities. C.

Oakes: In the previous answer, the minister opened up the opportunity for guideand outfitters to look atother areas, perhaps — where guidesand outfitters who may have lost significant territory might be offered hunts in other areas. Could the minister provide more detail? Hon. D.

Donaldson: I justwantto say thatwe’re working hard as a ministry to accomm odate the impactsof the wild- fires on guide-outfitters and trappers. [3:40 p.m.] As far as the guide-outfitters go, and looking athuntsin otherareas, thatwouldobviously be something thathas to be coordinated with peoplewho already have guiding ten- ures proximate to otherareas, as wellas in consultation with FirstNations, and itwouldbe species-specific.We don’thave a policy framework for thatyet.We’re trying to dealwith it and trying to assist people on a case-by-case basis. C.

Oakes: One of the challenges, or the opportunities, around economic developmentin ruralcomm unities is sig- nificantly impacted by transportation corridors orforestser- viceroads. A significantamountof damage did happen due to the wildfire seasons. We had the opportunity to canvass, through the Ministry of Transportation, funds for damaged roadnetworks, dueto the wildfires,thatleadto key econom- ic development opportunities in our region.

Are there funds through the ruraldividend or through the ruralstrategy, specifically, to investin those forestser- viceroads or transportation connections to key economic drivers? Hon. D. Donaldson: Again, ruraldividend criteria….If a transportation elementis partof an application by an eligible applicant, then that can be considered. It does not include the maintenanceforserviceroads in the ruraldividend fund right now. Having said that, transportation has been an element of some of the projectsin the pastin the ruraldividend fund thathave been approved.

As well, we have a modestbudget within our ministry for capital projects on forest service roads and replacement of structures and maintenance. C. Oakes: How much of the smallam ountof m oney in the budget do you have for the rural roads that you just m entioned? [3:45 p.m.] Hon. D. Donaldson: I suppose “m odest” is always a relative term when it com es to dollars, but in the bigger picture, it is a m odest am ount. It’s $13 million per year, ourengineering program, thatwe have forcapitalfunding. It’s deemed as sufficient to date. To date, we’ve expended less than $500,000 to repairand replacebridge structures.

That’s the overallcapsulethatwe have for the engineering and capital funding work. C. Oakes:The experiencein Slave Lake, whatthey found afterthe significant fire…. Because the forest service roads use plastic culverts,one of the challenges thatwe had on a lotof the sideroadissues was thatthe culvertshadmelted. Come spring, we are going to be faced with a significant challenge to a road network. While$13 million may seem like a considerableamount of money, whatI can say is thatone bridge is $500,000.

So when we’re looking atthe contextof $13 million and a sig- nificant amount of hectares that were affected by the wild- fires…. These roadnetworks are critical. This capitalassetis criticalto economic development,through tourism, mining, placer, ranching, forestry. What is the plan? Hon. D. Donaldson: Post-wildfire risk assessment has been done throughoutthe area thatthe memberrepresents, as wellas throughoutthe Cariboo.

Allof those risk assess- ments are complete, including road and drainage assess- ments.Priority areas have been identified around the freshet risk — in otherwords, the risk of erosion impactsfrom the spring melt.Those risks are ableto be addressed underthe current budget the ministry has. However, we do share the concerns that if there are unforeseen circumstances — due to weather issues, for instance — we will ensure that we make submissions to Treasury Board to address those. C.

Oakes: Then this risk assessment and the drainage piece — wouldthatcom e underthe $13 million, orwould thatbe aseparate line item in the budget?If so, whatis that am ount? Perhaps a secondary question that ties in with that. Tuesday, March 13, 2018 British Columbia Debates 3445

Slope stabilization is going to be a critical component, as well, to the road networks. Would that fall under your ministry orthe Ministry of Environment?Are there alloc- ated funds for that? [3:50 p.m.] Hon. D. Donaldson: The impactsfrom this wildfire are considered unforeseen eventsas far as the core work of the ministry goes, budget-wise. Where it is addressed, the assessing ongoing risk and rehabilitation, is underthe next vote, underthe B.C. Wildfire vote. Therefore, the work that has been done in this pastfiscalyearwas underthat— over $600 million in direct costsof addressing the wildfire situ- ation.

That’s where the risk assessmentdollars came from as wellas some of the rehabilitation work. Similarly, as we go forward into this coming fiscalyear, that’s where the funds will be allocated from. Hon. M. Farnworth:I don’tdo this very often, butI ask leave to make an introduction. Leave granted. Introductions by Members Hon. M. Farnworth:In the gallery and in the precinct today are four classes from one of the best elementary schools in PortCoquitlam, Cedar Drive. I hadthe pleasure of meeting the studentsand theirteacher. They asked some amazing questions, including, “You guys aren’t fighting in there?

I thoughtyou guys fought,” as one littlekid asked me. I said: “No, no, no. There’s a lotof good debate.” They were great students with great questions. I’d ask the House to please make the kids from Cedar Drive Elementary most welcome. Debate Continued C. Oakes: The reason I’ve been canvassing the question around side roads or transportation corridors as they lead to economic development is I noticed in the press release today thatthrough the ruraldividend, a significantamount of funds was given to promote or educate peopleon the…. There is a road that’s being….

Work is being done in the city of Quesnel on our main street. We have an economic development rural dividend fund, I think to the tune of $68,000 or$63,000 — excuse that I don’thave the exactamount— thatwe are providing funds to localgovernmentsorto organizations to talk aboutroads thatwork is going to be done on. Couldthe ministerprovide more detail or clarity on how roads getthrough the rural dividend program? [3:55 p.m.] Hon. D. Donaldson: I wantto thank my assistantdeputy minister, Dave Peterson, because there were a lotof projects approved.

The specificone that the member is referring to, one of the ones thatwas approved forQuesnel, was through Ques- neland the downtown business association. Thatmoney was targeted forensuring thatan advertising campaign wentout to make peopleaware that the downtown businesses were open forbusiness whileroadconstruction work was under- taken. That was the aspect of that application. C. Oakes: In estimates in November, we canvassed the critical need for emergency roads — again, both from an economic developm ent perspective but as an emer- gency….

We talked about the work that Lhoosk’uz Dené, Nazko and Lhtako have put forward for the Blackwater Road connection. Can the minister please update us on when that project will be starting? Hon. D. Donaldson: Well, I’m happy to report that $7 million in capitalfunding is now in placeto supporttheir two connector projects,which the member is referring to, with the Lhoosk’uz Dené. What we’re embarking on right now is an engagement with the First Nations comm unities around route selec- tion. We’re engaged on a planning phase on engineering for design options.

Of course, much of this engagement work with the comm unities also relates to the issue of cari- bou habitat. Happy to reportthatthe $7 million is in placenow. We’re going to be starting the engagement work with the com- munities, looking at commi ssioning design options and route selection. C. Oakes:Is thatpartof the $13 million, oris the $7 mil- lion in addition? Hon. D. Donaldson: It’s in addition to the $13 million. [4:00 p.m.] C. Oakes: I know thatthis is a long-awaited project.We really look forward to that moving forward, so thank you very much on behalfof the FirstNations comm unities that live out there.

Anotheremergency access pointthatis of criticalconcern and thathas been broughtforward is the Purdenconnector. The Purden connector is for folks who live out in Bowron Lake and Wells. When we saw significantfire activity, one of the challenges that we have out in that area is that there is no otheremergency exitpoint.I am wondering if the Pur- denconnectorwouldbe availableto apply forany of the pro- grams that the minister has discussed today. Hon. D. Donaldson: I recallthis topic well. I remember meeting with the regional district representative, having maps laid out and having a look at the Purden connector.

This is a separate topic from the last one we talked about, 3446 British Columbia Debates Tuesday, March 13, 2018

which was capital funding. I believe that that $7 million came through the Ministry of Transportation. We wellunderstand the concerns, and if thatprojectwere packaged as partof atourism initiative, an economic initiat- ive through Tourism, then itcouldconceivably be submitted underthe ruraldividend fund. Butthe ruraldividend fund generally is up to $500,000. Roadwork takes a lotof money, and it’s something that we’re well aware of the concerns on. C. Oakes:It’s aless expensive project,where I think there’s only sevenkilometresleftto connecton the road, and I think it’s $3 million.

So I’m putting thatoutthere as a really good, importanteconomic generatorforthe region. I willprovide thatadviceto the districtof Wells, aboutthe opportunity for putting that in through the rural dividend program. My final question. It couldbe just the challenge on the ruralstrategy orthe ruraldividend application. I think what I heard earlierwas thatDecember15, 2017 was the deadline of the applications thatwere announced this morning, and I think the wildfire comm unity consultations have just wrapped up.

Maybe that’s where the disconnect is, but our volunteer fire departments — critically important for the safety of ourcomm unities — really needed support in this budget with equipment caches or some really basic supplies. We’d canvassed thatthrough allof the ministries back in November. Really, the ruraldividend is probably ouronly option to support these volunteer fire departm ents with accessing capitalto supportthingslike generalcapitalpur- chases. Was itjusta disconnecton the timeline of December15 — thatwe didn’tsee any volunteerfire departments,as non- profits,receive any ruraldividend funds?

Can they stillapply for the next phase, and when would that deadline be? [4:05 p.m.] Hon. D. Donaldson: To ourknowledge, we didn’treceive, in this lastcallthatfinished December15, any applications from volunteerfire departments,from non-profits.The abil- ity for those organizations, which…. The memberhas done wellto highlightthe challenges faced by those volunteerfire departments when it came to the wildfire season, and the equipmentneeds and some of the equipmentthatgotcon- sumed during that.

There’s stillthe ability forthem to apply underspecialcir- cumstances.I have the ability outsideof the actual, general period, which is often a month, to receive applications. That regularopening callforapplications willbe conducted again in the spring, after this budget has been presented. There is also the ability, under gaming grants, which shouldbe examined by volunteerfire departments.Funding through the Ministry of MunicipalAffairs, gaming grants,is asourceas well. I don’tknow if this was canvassed underthe minister responsiblefor emergency management B.C., but that was another possibility.

Those are some options. I justwantto say thanks to the volunteerfire departments, because they keep my comm unity safe as well. C. Oakes:Thank you to the minister. I know thatyou rec- ognize how important our volunteer fire departments are. We need to getallof ourcomm unities safe. We need to be prepared, and we’ve gota really shortwindow. Comm unity gaming grantsforpublicsafety — thatnextintake is actually August.By the time thatintake happens, we’re already into another wildfire season. I will report back, during our constituent week, that volunteer fire departments can put in the special circum- stance.

I think it’s critical. It’s in allof ourbestinterests,both from a safety perspective and from an economic perspect- ive, to ensure thatourcomm unities are ready and prepared forthis upcoming fire season. So any work thatthe ministry can do in partnership to support that, I think, is critically important. Thatends my questions around ruraleconomic develop- ment. Thank you very much. D. Barnett: Economic development is not just putting new projects out. Economic development is existing and retention.

With this new budgetthat has come out — and you are, of course, putting togetheranew economic strategy — I sincerely hope thatin yourwork, there willbe policies put in placethat are going to protect some of our existing industries. An exampleI willgive to you of economic developmentin ruralBritish Columbia,of course, is forestry, which is ahuge partof the Cariboo-Chilcotin. With the new health care tax and the new carbon tax, I have hadmany phone calls from logging contractors who, through the pastwildfires, didnot work for 3½ months.

Some of them went out and fought fires, butthe rate they are paid was enough, basically, to pay for their help, pay for their fuel and their equipment. [4:10 p.m.] With these new taxes coming in, many of them will not make itvery long in the future, and many of them are think- ing that if there is not some assistance and some changes forthese businesses,which are ruraleconomic development, they will not be there. They will be at the auction sale. Through yournew economic strategy, are you looking at policies for retention of existing businesses? Hon. D.

Donaldson: I just want to thank the 800-plus contractors that assisted with the wildfire efforts, many of them in the member’s constituency. Also, to talk about the forestry business, we have many tools withinthe ministry to ensure thatlocalcontractors and local businesses that depend on forestry are supported in that. The main tool is the management of the forests. We expedited 1.3 million hectares of fire-impacted wood, got them under cutting permits, since the wildfires happened lastseason. I think that’s an incredibleamountof wood.

Of course, if you’re an associated business, with hauling wood orharvesting wood, then thatmeans certainty around work and getting a paycheque. So, yes, underthe ruraldevelopmentstrategy, one of the Tuesday, March 13, 2018 British Columbia Debates 3447

top things on my mind is ensuring that the existing small businesses we have related to forestry are ableto continue. Specifically from my ministry, that means managing the resource in a sustainable manner. D. Barnett:Thatdoes notanswermy question. This is an economic question. This is ruraldevelopmentretention for existing businesses that through no fault of theirown and no faultof anybody, need assistancewith policies,because of the new health care tax and the carbon tax. Otherwise their equipment will be going to auction.

Is there going to be something new in yourruraldevelop- ment portfolio to assist these existing businesses? Hon. D. Donaldson: The membercan referquestions that are associated with the health taxand smallbusiness taxes to the Minister of Finance during her budget estimates. We’re very concerned around contractors. We are awaiting the review of the contractors’ sustainability report from George Abbott.As I said, the bestway, from my ministry and what’s underthe jurisdiction of my ministry, to ensure the viability of contractors is to ensure the viability of the forest sector.

That’s whatwe’re doing, as faras replanting areas that have been impacted by forestfires, addressing foresthealth issues and ensuring that cutting permits for fire-damaged timber are expedited. D. Barnett:I wouldlike to really congratulate yourstaff in the Cariboo-Chilcotin forestry regions. They’ve done an am azing job of getting permits out and doing the great work they do. Still, underrural development, if we can’t keep existing businessesand retention, then we really are failingwith rural economic development.

I will ask the minister one more time: willthere be policieswithinyournew strategy to help retain existing businesses in ruralBritish Columbia, such as logging contractors, etc.? Hon. D. Donaldson: The rural development strategy is being created from the ground up through the engagement process I outlined earlier in the discussions. [4:15 p.m.] Key informants have been interviewed. People in com- munitieshave been engaged. There have been over3,000 site visitsto the engagementwebsite. So I’m notgoing to presup- pose what’s coming out of that engagement.

That will be a publicly available document, and we can go from there. Contractor sustainability is an issue throughout the province. It’s on my mind, and that’s why we’re currently reviewing— the contractorsustainability review thatGeorge Abbott is conducting. There likely couldbe policy recom- mendations that come out of that — in fact, I hope there are — to address contractor sustainability. Once those are reviewed, then I will be able to discuss them publicly. D. Barnett: I understand that Mr. Abbott has signed off on thatreview. Couldyou please tellus whenthatreview will be publicly released? Hon. D.

Donaldson: The report, the review by George Abbott,is being analyzed withinmy ministry. I haven’tseen it yet.When I do see it, then I’ll be ableto give direction about publicpolicy initiatives that will arise out of it. I’m anxious to get it out the door. I know, having metwith the Truck Loggers Association, forinstance, on numerous occasions, and knowing from the localcontractors in my area, thatthere are some majorcon- cerns aboutsurvivalwithinthe industry. Itgoes to the point that the member is raising about retaining existing busi- nesses, which is essential.

There are areas of the province where, for example, the timberprofilethat’s already allocated has notbeen ableto be harvested and broughtto mills as soon as whatwe wouldlike because of a lack of contractors. I know that’s been happen- ingin the areathatthe memberrepresents.So I’m anxious to get the review out as soon as possible. D. Barnett:Will that report be released publicly? Hon. D. Donaldson: Thank you for the interest in the report.Generally, any recomm endations thatare approved outof my officethatare based on the reportwillbe m ade public.

I just want to give the caution around release of the full report, because there might be some legal implications around the softwood lumberagreement.We wantto be care- fulwith thatpart,because we don’twantto damage ourcase in front of NAFTA and some of the appeals we’ve launched. I wantto assure the m emberthatI believe in transpar- ency and that the recomm endations that stem from the reportthatI’m going to putforward willdefinitely be pub- licly available. D.

Barnett: Back on October 16, 2017, when we were doing estimates, I asked you a question about the rural dividend fund: woulditbecome a fund forfloods and wild- fire issues? You comm ented: “The remaining ruraldividend funds thatwillbe distributed are nota disasterfund. I want to assure the memberthatthat’s nothow we’re going to typi- fy it.Itis notdirectly associated as adisasterfund orarecov- ery fund.” [4:20 p.m.] One of the concerns I have, Minister, is thatallourareas — ourcomm unities; ourruralareas; ourcitizens, of course — are concerned about wildfire mitigation.

I see the announcements which came out from the government through the fourth intake of the rural dividend fund did include some wildfire mitigation in a particular comm unity. My question to you, Minister: now that the gates have been opened on the ruraldividend fund to do wildfire mit- igation, willitbe one thatis going to continueon? Can every area and society thatis concerned aboutwildfire mitigation 3448 British Columbia Debates Tuesday, March 13, 2018

use this fund as that? Hon. D. Donaldson: I stand by the fact that the rural dividend is not a wildfire recovery fund. Having said that, there are special circumstance applications that are special circumstances. I’m happy that $3,809,518 was awarded to wildfire-impacted comm unities. Some of the proposals might have been funded even if there hadn’tbeen wildfire situations. It’s impossibleto artifi- cially separate outthe situations related to wildfire and not wildfire. I want to make sure that the member knows that $693,678 was awarded duringthe projectdevelopmentfund- ing stream.

The other$3,809,518 was underspecialcircum- stancerequests.In this budget,there is an upliftof $72 mil- lion targeted at wildfire recovery and wildfire resilience activities. D. Barnett:Minister, I appreciate the assistance thatour comm unitiesare getting. My question was notaboutprojects that are being funded in comm unities with wildfire. My question was about the wildfire mitigation on a corridor, which means wildfire mitigation to protectthe comm unity againstotherfires. The ruraldividend fund is there to create jobs, and the wildfire mitigation is there to protect com- munities.

My question to the minister is: is this fund going to be utilized forwildfire mitigation to protectcomm unities, oris it going to be used for rural economic development? Hon. D. Donaldson: The $72 million that I highlighted already — which I’m sure we’ll getsome further questions about, because it’s a good-news story — is associated with one aspect,wildfire resilience. The ruraldevelopmentfund is notspecifically targeted forwildfire resilience. That’s notthe specificpurpose of the fund. However, sometimes there is some overlap.

Some of the projectsthathave been approved mighthave offshootsthatmean employmentin those kinds of activities, butit’s notthe targetof the ruraldevelopment fund. The targetfor wildfire resilience is the $72 million in uplift of the budget that I alluded to previously. S. Bond: Good afternoon, Minister. I have a number of questions. I wantto buildon some of the questions thatmy colleagueshave asked, and there may be a bitof repetition, but that never hurts. [4:25 p.m.] I mightas welljuststartwhere we leftoff with the mem- ber’s questions.

The issue of the ruraldividend and the fund that’s availableis certainly not about being critical of sup- porting wildfire recovery in British Columbia. Our com- munity, as arecipientof thousands of evacuees and stepping up on a daily basis, certainly understands that. The concern — or, at least, the clarity we’d like — is the size of the pie. There are a lot of rural comm unities that require assistance in terms of ruraleconomic development. If there is a blurring of the line, where we’re suggesting now that: “Yes, there may be overlap. And we’re going to put a few otherhere.

And yes, there is specialcircumstancefund- ing….” The point is that there has always been far more demand in thatfund than there has been an ability to fund those projects. Is there acap on the specialcircumstancesfund to ensure that as…? I can’t imagine, I’m hopeful, that the entire size of the fund willgrow. We have increasing demand in rural comm unities. This fund plays a criticalrolein comm unities thatI represent.So is there a cap on specialcircumstances? Is the ministeradvocating on behalfof wildfire recovery to receive additional funding rather than taking it out of the rural dividend fund? Hon. D.

Donaldson: Thank you for the question. I acknowledge, as well, the citizens of Prince George who reached out, above and beyond, to host — I think at one point it was 9,000 — visitors from fire-impacted zones. I know the member was volunteering at some of the evacu- ation centres as well. I just want to make sure that people know how welcoming Prince George citizens were for the people in the province that were in need. There is additionalfunding addressing wildfire recovery and wildfire resiliencethatI advocated for. Thatresulted in a $72 million upliftto the budgetfor those two particular areas.

I fully agree with the member that there is way more demand in ruralareas than what’s availablewithinthe rural dividend budget — and an increasing demand. The rural dividend fund is notbeing used as an alternative to address wildfire recovery. However, if acomm unity makesan applic- ation for a legitimate project and there’s job creation involved from that,then it’s something thatwe wantto con- sider in a balanced approach. I didn’tgetto the cap on specialcircumstances.I under- stand where the member may be going. You have a rural dividend with certain criteria,and you wantitto be used for those criteria.

You don’twantitoverly allocated for special circumstances that are a result of an emergency situation. There is no cap on specialcircumstancesfunding within the rural dividend envelope, but we make those balanced decisions. [4:30 p.m.] S. Bond: Thank you to the ministerfor his response. Itis appreciated. I think the fact that the rural dividend is continuing is incredibly important.

I think that unless you are an MLA — and I certainly know the minister is — that represents regions of the province that utilizethis fund, I’m not sure peopleunderstand the impactsof having afund where com- munitiesthatare really strugglingto try to sortoutwhatthey look like in the future need that kind of assistance. I do appreciate the ongoing nature of the program. Cer- tainly, I wouldagree with the minister. We know thatthere needs to be a particular emphasis when there are circum- Tuesday, March 13, 2018 British Columbia Debates 3449

stances that warrant that, which are very extreme. I just wantto m ake sure thatthe principleof the ruraldividend fund remains intact,which is m aking sure thatcomm unit- ies thatare grappling with theirruraleconomic issueshave those kinds of funds availableto them. You know, shrink- ing the pot. I think the ministerdescribed itwell. It’s notan alternative funding forwildfire recovery. That’s really important.Itis an essential issue, but it needs to be paid for. And the invest- mentsthat the government makes need to pay for wildfire recovery.

So I appreciate those answers, and I’m sure that my constituentswillfeelmore comforted by the factthatthe program will be ongoing and there will be room for com- munities that haven’t faced catastrophic circumstances. I wantto pursuethe ruraldevelopmentstrategy. Kudosfor continuing the ruraldividend initiative. Notso many kudos for embarking on a wholenew rural strategy. I know that a greatdealof time and effortwas taken by a lotof people to create a framework and a discussion around the rural strategy that was put in placeby the previous government. Times change, and we’re going to see a new one, I guess.

The ministerreflected on whatmightbe publicand what mightnotbe public.This was a publicconsultation process in terms of the strategy that was going to be created. The input,as I understand it,closed on February 28, so can the minister be a bit more specificabout the timeline within which we might see a public strategy? Ruralcomm unities are challenged today, and they don’t have a lotof time to sitaround and waitfor governments to have conversations.

They need strategies thatare going to bring benefit.Couldthe ministerbe a bitm ore specific with whatthe nextsteps are, now thatthe inform ation ses- sion gathering time has closed? Whatcan we expectto see and when? [R. Chouhan in the chair.] Hon. D. Donaldson: The publicconsultation actually…. The publicinputis on the website. Itwas availabletillMarch 7, and the finalface-to-faceengagementsession is in Prince Rupert this Friday. We haven’t quite wrapped up the final parts of the public consultation. We wantto make sure….

I fully understand the member’s perspective about rural comm unities facing a lot of chal- lenges and notwanting to waitaround forthe government’s strategy. Having recently joined government, I understand things take longer to getmoving than many peoplewould like to see. However, we’llhave thatpublicstrategy available later this spring. S. Bond: Again, a complete strategy willbe laid outthat willthen be shared, I’m assuming, publicly. Willthere be a feedback loop for comm unities and peoplewho had input, provided suggestions?

I’m assuming there willbe some sort of comm unications plan where this strategy willgo outand the minister will receive some direct feedback about how comm unities feel about whether they were heard or not. [4:35 p.m.] Hon. D. Donaldson: We are goingto go back to the public with:“This is whatwe heard.” Itwon’tbe, I think the member said, a complete strategy. We’re notgoing to go back with a complete strategy. We wantto make sure thatwe letpeople know thatthis is whatwe heard so they have confidenceand trustthatthis is the summ ary of whatthey provided as feed- back. That will happen publicly in the spring. S.

Bond: Thank you to the minister for that response. I think peoplewillbe pleased thatthey’llhave an opportun- ity to see theircomm entsorideas reflected. I think that’s an important part of the process. I want to ask a more broad question about economic development.I think one of the concerns that,certainly, I’ve hadas alegislator, overmy time here, is the wholeconceptof ministriesthatwork in isolation from one another. Ittakes a greatdealof effortto make sure thatthere are cross-ministry approaches.

I think thatwhen itcomes to ruraldevelopmentand rural economic development,it’s one of the criticalareas, where it is nota stand-alone ministry — because transportation net- works matter, all of those things that contribute to a com- munity’s ability to grow and to develop an economy. Does the m

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Collection	British Columbia — Debates (Hansard)
Citation	20180313pm-Hansard-n103
Type	hansard
Volume / chapter	20180313pm Hansard n103
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