Chapter 3.3: Responsible Resource Development, Conserving Canada’s Natural Heritage, and Investing in Infrastructure and Transportation

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Highlights

Responsible Resource Development

• The Government will develop and present detailed responses to the recommendations made by the Tanker Safety Expert Panel and the Special Representative on West Coast Energy Infrastructure.
• $28 million over two years to the National Energy Board for comprehensive and timely reviews of project applications and to support the Participant Funding Program.
• Eliminating tariffs on mobile offshore drilling units used in offshore oil and gas exploration and development.
• $66.1 million over two years to renew the Atlantic Integrated Commercial Fisheries Initiative and the Pacific Integrated Commercial Fisheries Initiative.

Supporting Mining, Forestry and Agriculture

• Supporting mineral exploration by junior companies by extending the 15-per-cent Mineral Exploration Tax Credit for flow-through share investors for an additional year.
• $90.4 million over four years to continue to support the Investments in Forest Industry Transformation program.
• $18 million over four years for early intervention to prevent the spread of spruce budworm in Atlantic Canada and Quebec.
• Expanding the types of farming livestock that qualify for tax deferral on sale by farmers dealing with extreme weather conditions.

Asserting Canada’s Sovereignty by Investing in the North

• Exercising Canada’s sovereignty over the North by securing international recognition of the limits of Canada’s extended continental shelf, including the North Pole.
• $40 million over two years, starting in 2014–15, to renew the Strategic Investments in Northern Economic Development program delivered by the Canadian Northern Economic Development Agency.
• Working with territorial governments to develop transportation infrastructure in the North.
• $70 million over three years for a new, targeted and time-limited fund to increase health services in the three territories in priority health areas and to reduce the reliance on outside health care systems and medical travel.
• Enhancing funding for Nutrition North Canada to help improve access to healthy food in the communities it serves.

Conserving Canada’s Natural Heritage

• $391.5 million over five years on a cash basis to the Parks Canada Agency to make improvements to highways, bridges and dams located in our national parks and along our historic canals.
• $15 million over two years to extend the Recreational Fisheries Conservation Partnerships Program.
• Encouraging additional donations of ecologically sensitive land by doubling, for income tax purposes, the carry-forward period for donations of such land.
• $10 million over two years to improve and expand snowmobile and recreational trails across the country.
• $3 million over three years to support the Earth Rangers Foundation to expand its existing family-oriented conservation and biodiversity programming.
• Expanding tax incentives for clean energy generation to include a broader range of equipment.

Investing in Infrastructure and Transportation

• $165 million over two years on a cash basis to advance the construction of a new bridge for the St. Lawrence.
• $378 million over two years on a cash basis to advance the repair and maintenance of federal bridges in the Greater Montreal Area, including the Champlain Bridge to ensure it is properly maintained until the new bridge for the St. Lawrence opens.
• $58 million over two years to support the continued operation of the Digby, Nova Scotia–Saint John, New Brunswick, Wood Islands, Prince Edward Island–Caribou, Nova Scotia, and Îles de la Madeleine, Quebec–Souris, Prince Edward Island ferry services.
• $40 million over two years on a cash basis to accelerate repair and maintenance work at small craft harbours across Canada.
• $33 million over two years to support the divestiture of regional ports to local interests and the continued operation and maintenance of federally owned ports.

Responsible Resource Development, Conserving Canada’s Natural Heritage, and Investing in Infrastructure and Transportation

Major natural resource projects are an important source of development and job creation in all regions of Canada. Our diverse and abundant natural resource sector is an asset that benefits all Canadians, especially Aboriginal peoples. Economic Action Plan 2014 proposes to take further steps to ensure safe and responsible resource development.

Mining, forestry and agriculture represent important contributors to the Canadian economy and create jobs, particularly in many rural communities. Economic Action Plan 2014 proposes to continue to support innovation in the forestry and mining sectors. The Government has also made significant investments to help farmers create jobs and prosperity.

Canada’s North is a fundamental part of our heritage, our future and our identity as a country. Building on the Government’s vision for a new North, Economic Action Plan 2014 is taking action to ensure that the North realizes its full potential by exercising our Northern sovereignty, promoting economic prosperity and supporting the health of Northerners.

Protecting the health and well-being of Canadians by promoting a safe and clean environment is a Government priority. As highlighted in the recent Speech from the Throne, the Government will soon introduce a National Conservation Plan. To that end, Economic Action Plan 2014 proposes measures to invest in national parks, conserve recreational fisheries, protect ecologically sensitive land, expand recreational trails, and support family-oriented conservation and clean energy generation.

Economic Action Plan 2014 also makes strategic investments in public infrastructure and transportation services, including in major bridges, small craft harbours and ports, and ferry services. These investments will contribute to economic growth and job creation and provide a high quality of life for Canadians.

Responsible Resource Development

Responsible resource development is an important part of the Government’s economic plan to create jobs, growth and long-term prosperity. Through the responsible development of our immense natural resources, Canadian companies are creating good, well-paying and highly skilled jobs in communities across Canada. In fact, Canada’s natural resource sector represents 18 per cent of the economy and over half of our exports, and supports 1.8 million jobs directly and indirectly. Furthermore, it generates about $30 billion annually in revenue to governments, equal to approximately half of all spending on hospitals in Canada in 2013.

Canada is a major player in the world energy economy, in addition to its strength in mining, forestry and agriculture. Hundreds of resource projects are underway or planned over the next 10 years representing a total potential investment of $650 billion. According to the Conference Board of Canada, British Columbia’s natural gas sector alone could attract an average of more than $7.5 billion in new investment each year from now until 2035.

These projects will create hundreds of thousands of jobs and generate significant economic growth. Canada’s energy advantage translates into concrete benefits for all Canadians as increasing revenues allow the Government to finance critical social programs and lower taxes.

The significant employment and profit opportunities for Aboriginal peoples associated with natural resource development cannot be overstated. The Government will continue to consult with Aboriginal partners on maximizing opportunities related to resource projects.

Action Plan to Improve Northern Regulatory Regimes

Territorial governments, Aboriginal groups and industry have repeatedly expressed the need for more predictable regulatory processes in the North that enhance environmental protection, while encouraging exploration and investment. Significant progress has been made to date as part of the Action Plan to Improve Northern Regulatory Regimes, including the Northern Jobs and Growth Act, which passed into law in June 2013. The Government is continuing to work with partners and stakeholders to improve regulatory regimes in the North, including through enhancements to the regulatory system in the Mackenzie Valley, presently being considered by Parliament, and through upcoming improvements to the Yukon Environmental and Socio-economic Assessment Act.

Strengthening Canada’s Marine Oil Spill Prevention, Preparedness and Response Regime

The National Energy Board estimates that Canadian crude oil production will reach 5.8 million barrels per day by 2035, an increase of nearly 75 per cent over 2012 levels. In 2035, the oil sands are expected to account for nearly 86 per cent of Canada’s oil production, compared with 57 per cent in 2012. The Alberta government anticipates over $200 billion in capital investments in the oil sands between 2013 and 2022, each dollar of which would create about $8 of economic activity. The British Columbia government indicates that there is potential to create 21,600 construction jobs and 2,400 permanent jobs for operation and maintenance from liquefied natural gas facilities. Currently, about 98 per cent of Canada’s crude oil exports and 100 per cent of our natural gas exports are to the United States. Exporting only to the U.S. market has resulted in significantly lower Canadian crude oil prices relative to global benchmarks in recent years. This is significantly reducing the value of Canadian exports and gross domestic product.

As reiterated in the 2013 Speech from the Throne, ensuring safe and responsible resource development remains a key priority for the Government. Developing the infrastructure to build safe pipelines and strengthening the tanker safety regime to transport our energy exports to new markets are essential for Canada’s future prosperity and security. Canada’s west coast provides the most direct route for western oil and gas resources to fast-growing Asia-Pacific energy markets.

Since 2012, the Government has provided funding in support of increased tanker safety inspections, a new incident command system, new and modified aids to navigation, and stronger oversight requirements for pollution prevention and response at oil handling facilities.

The Government is taking steps to continue improving the tanker safety regime as energy exports are expected to grow and create many high-quality jobs in Canada. On March 18, 2013, the Government announced the creation of the Tanker Safety Expert Panel to review Canada’s current tanker safety regime and propose further measures to strengthen it. The Panel was asked to conduct a pan-Canadian, evidence-based review and assessment of Canada’s tanker safety regime and to make recommendations to the Government on the development of a world-class system. The review had two components: the first component focused on the regime currently in place south of the 60th parallel, while the second component was to address the requirements for an Arctic regime.

The Panel submitted its first report on the regime south of 600 N to the Government on November 15, 2013. The Panel made several recommendations regarding how the industry, communities and governments could better prepare for and respond to oil spills, including through enhanced planning, improved response capacity and stewardship. The Panel also suggested regular reviews to promote continuous improvement of the overall regime. The Government is carefully reviewing the Panel’s report and will present measures to respond to its recommendations in consultation with industry and Canadians.

Review of Pipeline Projects

Economic Action Plan 2014 proposes to provide $28 million over two years to the National Energy Board.

The National Energy Board is an independent federal agency established to regulate international and interprovincial aspects of the oil, gas and electric utility industries, including interprovincial and international pipelines. Economic Action Plan 2014 proposes to provide $28 million over two years to the National Energy Board to review project applications, such as TransCanada Pipelines Limited’s Energy East Pipeline Project, within legislated timelines to provide timeline certainty and to enhance the Participant Funding Program. This funding will be fully cost-recovered from industry.

Supporting Offshore Oil and Gas Development

Economic Action Plan 2014 proposes to permanently eliminate tariffs on mobile offshore drilling units used in offshore oil and gas exploration and development. The duty-free status of these units, which was scheduled to expire in 2014, lowers business costs by $13 million annually, improving the global competitiveness of Canadian energy projects, and increasing the potential for valuable resource discoveries in Canada’s Atlantic and Arctic offshore areas. This measure will provide important maintenance and repair opportunities for Canadian shipyards.

Special Representative on West Coast Energy Infrastructure

In 2012, more than 30,000 Aboriginal people worked in energy, mining and forestry jobs throughout Canada. And equally important, innovative partnerships are being formed between Aboriginal communities, governments and the private sector to capitalize on the potential social and economic benefits offered by natural resource development.

In March 2013, the Government appointed a Special Representative on West Coast Energy Infrastructure, Mr. Douglas Eyford, to engage with Aboriginal communities in British Columbia and Alberta on energy infrastructure development. The Government has made public the Special Representative’s final report and is closely reviewing the recommendations made in all four areas: building trust, fostering inclusion, advancing reconciliation and taking action. The Government will present measures to respond to Mr. Eyford’s report.

Supporting First Nation Fishing Enterprises

Economic Action Plan 2014 proposes to provide $66.1 million over two years to renew the Atlantic Integrated Commercial Fisheries Initiative and the Pacific Integrated Commercial Fisheries Initiative.

The Atlantic and Pacific Integrated Commercial Fisheries Initiatives help integrate First Nation fishing enterprises into existing commercial fisheries, providing economic opportunities for First Nation fishermen and improving the overall management of fisheries on the Atlantic and Pacific coasts. The Initiatives support First Nation participation in decision-making processes to ensure they are directly involved in the responsible management of commercial fisheries.

To build on the progress achieved to date and to continue promoting the integration of commercial fisheries, Economic Action Plan 2014 proposes to provide $66.1 million over two years to renew funding for the Atlantic and Pacific Integrated Commercial Fisheries Initiatives.

Supporting Mining, Forestry and Agriculture

Mining, forestry and agriculture are important contributors to the Canadian economy. These sectors create jobs and prosperity, particularly in many rural Canadian communities. Economic Action Plan 2014 proposes to continue to support mineral exploration by junior companies and the forestry sector. The Government has also taken recent action to strengthen the agricultural sector.

Supporting Junior Mineral Exploration

Economic Action Plan 2014 proposes to extend the 15-per-cent Mineral Exploration Tax Credit for flow-through share investors for an additional year.

Canada is one of the world’s leading mining nations and has had the largest global share of spending on exploration for non-ferrous minerals every year since 2002. According to the Mining Association of Canada, over 90,000 Canadians are employed in mineral extraction and mining support activities in communities right across the country.

Promoting the exploration of Canada’s mineral resources by junior exploration companies helps create jobs and economic development across the country. The 15-per-cent Mineral Exploration Tax Credit helps these companies raise capital by providing an incentive to investors in flow-through shares issued to finance mineral exploration. This credit is in addition to the deduction provided to the investor for the exploration expenses “flowed through” by the company that issues the shares. Since 2006, the Mineral Exploration Tax Credit has helped junior mining companies raise over $5 billion for exploration. In 2012, over 350 companies issued flow-through shares with the benefit of the credit to more than 30,000 individual investors.

The credit is scheduled to expire on March 31, 2014. However, to support the mineral exploration efforts of junior exploration companies in a context of continued economic global uncertainty, Economic Action Plan 2014 proposes to extend the credit for an additional year, until March 31, 2015.

It is estimated that the extension of this measure will result in a net reduction of federal revenues of $45 million over the 2014–15 to 2015–16 period.

Supporting Canada’s Forestry Sector

Economic Action Plan 2014 proposes to provide $90.4 million over four years starting in 2014–15 to continue to support the Investments in Forest Industry Transformation program.

Canada’s forestry sector directly employs over 200,000 workers in all regions of the country, including in 200 communities that rely on the sector for at least 50 per cent of their economic base. First established in Budget 2010, the Investments in Forest Industry Transformation (IFIT) program has been successful in enabling Canadian forestry companies to lead the world in demonstrating the viability of innovative technologies that improve efficiency, reduce environmental impacts, and create high-value products from Canada’s world-class forest resources. For example, IFIT provided support to the Tolko Industries Ltd. mill in Meadow Lake, Saskatchewan, to develop the first facility in North America to use innovative technology to boost productivity by enabling the production of different types of oriented strand board on a single production line. Economic Action Plan 2014 proposes to provide $90.4 million over four years starting in 2014–15 to renew the IFIT program.

The Government continues to work with the forestry sector as it invests in innovative new products and pursues new markets for Canadian forest products.

Protecting Jobs in Eastern Canada’s Forestry Sector

Economic Action Plan 2014 proposes to provide $18 million over four years, starting in 2014–15, for early intervention to prevent the spread of spruce budworm in Atlantic Canada and Quebec.

The spruce budworm is one of the most damaging insects for spruce trees in Canada, causing defoliation and tree mortality. Early intervention to prevent the spread of spruce budworm in Atlantic Canada and Quebec will protect the region from losing valuable forest resources to the severe defoliation that would be caused by a major outbreak.

Economic Action Plan 2014 proposes to provide $18 million over four years starting in 2014–15 to support early intervention measures to stop the spread of the spruce budworm in Atlantic Canada and Quebec, including $2 million through Natural Resources Canada. These measures will help to maintain a viable forestry sector in eastern Canada and protect the jobs of workers that rely on the industry’s health.

Supporting Farmers

The agriculture and agri-food sector plays a significant role in the Canadian economy, accounting for over $100 billion in economic activity and providing employment to over 2.1 million Canadians in 2011. The Government continues to take action to strengthen Canada’s agricultural sector through the new Growing Forward 2 policy framework, which came into effect on April 1, 2013. Under the framework, federal and provincial governments are providing more than $3 billion over five years for investments in innovation, competitiveness and market development. The framework also provides producers across Canada with an effective suite of Business Risk Management programs to assist in cases of severe market volatility and disasters.

Launching a Pilot Price Insurance Program for Western Livestock Producers

Sudden drops in market prices are a major source of risk for livestock producers. Starting this Spring, a new pilot price insurance program will be available to cattle and hog producers in Western Canada, offering insurance against unanticipated price declines. The four-year pilot Western Livestock Price Insurance Program is a unique and collaborative arrangement between the federal government and the Western provinces to enhance risk management options available to the livestock industry. The program will be actuarially sound and self-sustaining, with premiums fully funded by producers.

Tax Deferral for Farmers

Economic Action Plan 2014 proposes to expand the types of farming livestock that qualify for tax deferral on sale by farmers dealing with drought or excess moisture conditions.

A special income tax rule is available to farmers who dispose of breeding livestock due to drought or excess moisture conditions existing in specific regions in a given year. This rule permits farmers to exclude up to 90 per cent of the sale proceeds from their taxable income until the year following the sale, or a later year if the conditions persist. Economic Action Plan 2014 proposes to extend this tax deferral to bees and to all types of horses that are over 12 months of age and that are kept for breeding, effective for the 2014 and subsequent taxation years.

It is estimated that these changes will reduce federal revenues by a small amount in each of 2013–14, 2014–15 and 2015–16.

Modernizing the Plant Breeders’ Rights Act

To continue supporting innovation and competitiveness in Canada’s agricultural sector, the Government has introduced the Agricultural Growth Act. The Act will enhance trade opportunities and the safety of agricultural products, reduce red tape and contribute to Canada’s overall economic growth. The legislation will also amend the Plant Breeders’ Rights Act to align it with the 1991 Convention of the International Union for the Protection of New Varieties of Plants (UPOV 91). Stronger intellectual property rights for plant breeders will encourage investment in Canadian research and development, improving access to new and innovative seed varieties for Canadian farmers. The new legislation includes Farmers’ Privilege, allowing farmers to continue to save and reuse seeds for replanting on their own farms.

Removing Red Tape for the Beer Industry

The Government will modernize the compositional standards for beer under the Food and Drug Regulations to reflect innovation in the industry. The Government will also develop a plan to modernize other compositional standards.

The Government of Canada recognizes that some provisions under the Food and Drug Regulations are not keeping pace with industry innovation and changing markets. For example, the specific standards of composition for beer under the Food and Drug Regulations do not account for some new styles of craft beer on the market. The Government will develop a plan to address these issues through regulatory modernization initiatives.

Asserting Canada’s Sovereignty by Investing in the North

Canada’s North is a fundamental part of our heritage, our future and our identity as a country. Building on the Government’s vision for a new North, Economic Action Plan 2014 is taking action to ensure that the North realizes its full potential by exercising our Northern sovereignty, promoting economic prosperity and supporting the health of Northerners.

Securing Recognition of Canada’s Extended Continental Shelf

The Government must define and assert its national borders and control access across them. This exercise of sovereignty is a core Government priority.

The Government will therefore continue its efforts to exercise Canada’s sovereign rights and secure international recognition of the limits of Canada’s extended continental shelf, including the North Pole, under the United Nations Convention on the Law of the Sea. In December 2013, Canada filed a submission that supports our claim to sovereignty of approximately 1.2 million square kilometres extended continental shelf in the Atlantic Ocean, but our work is not yet complete. When it comes to asserting a claim to an extended continental shelf, the currency of sovereignty is scientific data. The Government is therefore developing options to obtain the data required to support Canada’s claim to sovereign rights of additional territory beneath the Arctic Ocean, including the Lomonosov Ridge.

Supporting Northern Economic Development

Economic Action Plan 2014 proposes to provide $40 million over two years, starting in 2014–15, to renew the Strategic Investments in Northern Economic Development program delivered by the Canadian Northern Economic Development Agency.

Canada’s North has tremendous economic potential, particularly in the mining and oil and gas industries, and in renewable resource industries such as commercial fishing. The Strategic Investments in Northern Economic Development (SINED) program focuses on enhancing the economic infrastructure of the territories; developing the capacity of Northern organizations and individuals to help them take advantage of economic opportunities; promoting economic diversification; and increasing dialogue on Northern economic development issues.

This core program of the Canadian Northern Economic Development Agency (CanNor) has advanced economic growth in the North and helped Northerners to benefit from resource development activities. To support development in the North, Economic Action Plan 2014 proposes to provide $40 million over two years, starting in 2014–15, to renew CanNor’s SINED program.

Developing Transportation Infrastructure in the North

The need for a strong network of transportation infrastructure in the territories has intensified as a result of population growth, increased demand for ecotourism and investment in resource development projects. To help unlock the economic potential of the North, the Government of Canada will work with territorial governments and local municipalities to develop transportation infrastructure in the North.

Territorial Health Investment Fund

Economic Action Plan 2014 proposes to provide $70 million over three years for a new, targeted and time-limited fund to increase health services in the three territories in priority health areas and to reduce the reliance on outside health care systems and medical travel.

To support the provision of timely access to quality health care in the North, the Government recently renewed long-term, predictable funding through the Canada Health Transfer and Territorial Formula Financing. In recent years, the Government has also provided additional funding to facilitate the transformation of territorial health systems to ensure greater responsiveness to Northerners’ needs and improve community-level access to services. This three-year investment will help territorial governments to improve health services in targeted areas while completing the transition to delivering more efficient and effective in-territory health services sustained by the significant and growing support provided through federal transfers.

Improving Access to Healthy Food for Northerners

Economic Action Plan 2014 proposes to enhance funding for Nutrition North Canada.

The cost of nutritious food is much higher in isolated Northern communities than other parts of Canada, making it more difficult for many families to eat healthy. In order to address these challenges, the Government introduced Nutrition North Canada in 2011. With a budget of $60 million per year, the program subsidizes retailers located in remote and isolated communities for the high cost of stocking perishable nutritious food in their stores, helping to reduce the price consumers pay and increasing their access to healthy food. People living in 103 isolated Northern communities benefit from this program, which also promotes culturally appropriate nutrition education and health promotion initiatives.

Economic Action Plan 2014 commits to enhance funding for the program to help improve access to healthy food in these communities. Details will be announced in the coming months.

Conserving Canada’s Natural Heritage

Protecting the health and well-being of Canadians by promoting a safe and clean environment is a Government priority. Since 2006, the Government has taken significant action to protect our natural areas, including taking steps to add more than 160,000 square kilometres to the Canadian federal parks and marine conservation system—a more than 58-per-cent increase—and securing almost 4,000 square kilometres of ecologically sensitive private lands. Economic Action Plan 2014 proposes to provide over $400 million on a cash basis for measures to protect and preserve Canada’s rich natural heritage by making improvements to Canada’s national parks, conserving recreational fisheries, encouraging additional donations under Canada’s Ecological Gifts Program, expanding recreational trails, supporting family-oriented conservation and expanding tax support for clean energy generation.

The 2013 Speech from the Throne announced that the Government would act to protect Canada’s rich natural heritage through a new National Conservation Plan to further increase protected areas, focusing on stronger marine and coastal conservation. Details regarding the Plan, which will build on the measures proposed in Economic Action Plan 2014, will be announced in the coming months.

Sustaining Canada’s National Parks

Economic Action Plan 2014 proposes to provide $391.5 million over five years on a cash basis to the Parks Canada Agency to make improvements to highways, bridges and dams located in our national parks and along our historic canals, facilitating better access to these national treasures.

Federal infrastructure plays a critical role in enabling the safe and efficient movement of people and goods, creating employment opportunities in many communities and supporting economic growth. Economic Action Plan 2014 proposes to provide $391.5 million over five years on a cash basis to the Parks Canada Agency to make improvements to highways, bridges and dams located in our national parks and along our historic canals. Proposed projects include structural repairs to the Crow Bay Dam, which is part of the Trent-Severn Waterway in Ontario, as well as paving and other repairs to the section of the Trans-Canada Highway which passes through Glacier National Park in British Columbia.

Conserving Recreational Fisheries

Economic Action Plan 2014 proposes to double annual funding for the Recreational Fisheries Conservation Partnerships program by providing an additional $15 million over two years.

The Recreational Fisheries Conservation Partnerships Program was established in June 2013 to support projects aimed at improving the conservation of recreational fisheries habitat. The Program brings partners together and pools their resources to support the common goal of conserving and protecting Canada’s recreational fisheries.

During the program’s first year, a total of 96 projects have been approved. For example, the Ontario Federation of Anglers and Hunters’ Community Stream Steward Program received funding to complete projects that removed barriers to fish passage such as debris and log jams and enhanced habitat by stabilizing riverbanks.

Economic Action Plan 2014 proposes to provide an additional $15 million over two years to extend theRecreational Fisheries Conservation Partnerships Program. Funding will allow the Government to support additional conservation projects in communities across the country.

Donations of Ecologically Sensitive Land

Economic Action Plan 2014 proposes to double the carry-forward period for donations of ecologically sensitive land.

The Ecological Gifts Program provides a way for Canadians with ecologically sensitive land to protect natural areas and leave a legacy for future generations. Under the Program, donations to certain registered Canadian charities of land that has been certified as ecologically sensitive are eligible for special tax assistance, including the Charitable Donations Tax Credit for individual donors and a deduction for corporate donors. Charitable donations not claimed in a year may be carried forward for up to five years. To encourage additional donations of ecologically sensitive land, Economic Action Plan 2014 proposes to double the carry-forward period for donations of such land to 10 years, as recommended by the House of Commons Standing Committee on Finance in its February 11, 2013 report, Tax Incentives for Charitable Giving in Canada.

It is estimated that this change will reduce federal revenues by a small amount in each of 2013–14, 2014–15 and 2015–16.

Improving and Expanding Canada’s Snowmobile and Recreational Trails

Economic Action Plan 2014 proposes to provide $10 million over two years to improve and expand snowmobile and recreational trails across the country.

Canada has a vast network of recreational trails, which allow Canadians to experience the outdoors and appreciate this country’s natural beauty. Through Budget 2009, the Government provided $25 million to the National Trails Coalition, a non-profit organization, to create, upgrade and sustain snowmobile and all-terrain-vehicle trails throughout the country. Additional funding was leveraged from the coalition and its partners and close to 500 projects were completed under this initiative. Federally supported investments include: over $56,000 for safety improvements to trails in Lakefield, Ontario; $244,000 for improvements to bridges and trails in Val d’Or, Quebec; and $550,000 for the development of the Confederation Trail in Prince Edward Island.

Economic Action Plan 2014 proposes to provide an additional $10 million over two years, beginning in 2014–15, to the National Trails Coalition to improve and expand snowmobile and recreational trails across Canada.

Exploring Opportunities to Restore Access to Partridge Island

Economic Action Plan 2014 proposes to provide $200,000 in 2014–15 for an engineering study to examine the feasibility of repairing the breakwater that connects Partridge Island to mainland New Brunswick.

Partridge Island, located at the entrance of the Saint John Harbour in New Brunswick, played a significant role in the development of our nation, particularly the Maritime provinces. Partridge Island was used as a quarantine station for many early maritime immigrants, including Irish immigrants fleeing the Great Famine in the 19th century.

Economic Action Plan 2014 proposes to provide $200,000 in 2014–15 for an engineering feasibility study of the breakwater connecting Partridge Island to mainland New Brunswick. This study will examine options to provide safe access to Partridge Island via the breakwater.

The Earth Rangers Foundation

Economic Action Plan 2014 proposes to provide $3 million over three years to support the Earth Rangers Foundation to expand its existing family-oriented conservation and biodiversity programming.

Earth Rangers is a conservation organization dedicated to educating children and families about biodiversity and empowering them to become directly involved in protecting animals and their habitats. Economic Action Plan 2014 proposes to provide $3 million over three years to support the Earth Rangers Foundation to expand its existing family-oriented conservation and biodiversity programming.

Expanding Tax Support for Clean Energy Generation

Economic Action Plan 2014 proposes to expand eligibility for the accelerated capital cost allowance for clean energy generation equipment to include water-current energy equipment and a broader range of equipment used to gasify eligible waste.

The income tax system encourages businesses to invest in clean energy generation and energy efficiency equipment by providing an accelerated capital cost allowance (CCA) rate. CCA Class 43.2 includes a variety of stationary equipment that generates energy by using renewable energy sources or fuels from waste, or conserves energy by using fuel more efficiently. It allows the cost of eligible assets to be deducted for tax purposes at a rate of 50 per cent per year on a declining-balance basis—faster than would be implied by the expected useful life of the assets.

Economic Action Plan 2014 proposes to expand Class 43.2 to include:

• water-current energy equipment; and
• a broader range of equipment used to gasify eligible waste.

It is estimated that these measures will reduce federal revenues by a small amount in 2014–15 and by $1 million in 2015–16.

Investing in Infrastructure and Transportation

A safe, dependable network of highways, roads, transit, water and wastewater facilities and other public infrastructure assets are essential to Canada’s long-term prosperity and to a high quality of life for families in every community across Canada.

All levels of government have a responsibility to strengthen the public infrastructure assets they own and maintain. The Government of Canada  partners with other levels of government to invest in provincial, territorial and municipal infrastructure assets that support economic growth and strong communities. The Government of Canada also provides support to First Nations to build, maintain and operate their community infrastructure on reserves.

Since 2006, the Government of Canada has provided an unprecedented level of investment in public infrastructure across the country:

• Through the $33-billion 2007 Building Canada plan, the Government has supported over 12,000 provincial, territorial and municipal infrastructure projects across Canada.
• The stimulus phase of Canada’s Economic Action Plan supported an additional 30,000 infrastructure projects that created immediate jobs and enhanced Canada’s long-term economic growth and competitiveness.
• The Government has provided increased and ongoing federal support for municipal roads, public transit and recreational facilities through the Gas Tax Fund—first doubling the size of the program to $2 billion per year in 2009 and then passing legislation to make funding for the program permanent in 2011 and further indexing it at 2 per cent per year, starting in 2014–15, with increases to be applied in $100-million increments.
• Investments totalling $9.2 billion, including ongoing funding, have been made in First Nations communities across Canada to build, operate, maintain and renovate community infrastructure on reserves.

The Government’s predictable, long-term support for public infrastructure is achieving tangible results: improved roads, highways and public transit systems have shortened commuting times and facilitated the flow of goods and services; enhanced water and wastewater facilities have helped safeguard the environment and the health of Canadians; and upgraded recreation and tourism assets have contributed to building stronger communities across Canada.

Building on this success, Economic Action Plan 2013 announced a new 10-year, $53-billion Building Canada plan, representing the largest long-term federal infrastructure commitment in Canadian history. New investments under this plan will help build roads, bridges, subways, commuter rail and other public infrastructure assets that promote productivity and economic growth, in cooperation with provinces, territories and municipalities. This long-term commitment will also afford predictability and flexibility for provinces, territories and municipalities to plan and deliver large infrastructure projects efficiently.

Starting in 2014–15, the $53-billion Building Canada plan will provide:

• $21.8 billion over 10 years through the Gas Tax Fund, including an additional $1.8 billion in support over 10 years through the indexation of payments at 2 per cent per year.
• $10.4 billion over 10 years under the incremental Goods and Services Tax Rebate for Municipalities.
• $14 billion over 10 years for a new Building Canada Fund to support major economic projects that have a national, regional and local significance. The Government continues to consult with the Federation of Canadian Municipalities and other stakeholders to finalize the parameters of the new Building Canada Fund and is committed to launching the new Fund by March 31, 2014.
• $1.25 billion over five years for a renewed P3 Canada Fund to continue supporting innovative ways to build infrastructure projects through public-private partnerships (P3s).
• $6 billion in federal support to provinces, territories and municipalities under current infrastructure programs in 2014–15 and beyond.
• $155 million over 10 years for First Nations on-reserve infrastructure from the new Building Canada Fund, in addition to allocations from the Gas Tax Fund.

This funding will support innovative approaches to building infrastructure projects faster, for example through P3s, which provide better value for money and improve the delivery of much-needed infrastructure projects. P3s can help jurisdictions across Canada achieve better value for their infrastructure dollars through improved upfront planning and effective risk transfer to the private sector. Projects with eligible costs of more than $100 million submitted for federal funding under the new Building Canada Fund will be subject to a P3 screen.

PPP Canada Inc., a federal Crown corporation, will continue to lead federal efforts in encouraging the use of P3s where they can generate better value for money. Executing complex P3 transactions can be a challenge for smaller, inexperienced jurisdictions. As the Government of Canada’s centre of expertise on P3s, PPP Canada will increase its efforts to share best practices and promote the greater adoption of the P3 model in Canada. As part of this work, it will undertake additional efforts to provide smaller municipalities with information, guidance and tools to support P3s and promote the bundling of projects.

The Government is also providing increased support to help municipalities pursue long-term planning, including asset management plans, through the Gas Tax Fund.  These tools allow governments to take into account the costs associated with building an asset, as well as maintenance and rehabilitation costs, over the project’s full life cycle.  By incorporating such analysis and planning in infrastructure investment decisions, governments maximize the value of these investments for taxpayers and ensure sustainability over time.

The Government is also continuing to make significant investments in its own infrastructure portfolio of buildings, bridges and ports that contribute to economic growth and job creation in communities across the country. In Budget 2011, the Government announced that all federal projects with capital costs of $100 million or more would be subject to a P3 screen to determine whether procuring the project though a P3 would deliver better value for taxpayers. The Government will take measures to further leverage the expertise of PPP Canada to ensure the successful delivery of federal P3 projects.

Economic Action Plan 2014 proposes to allocate a further $1.3 billion over two years on a cash basis to support additional strategic investments in public infrastructure and transportation services across Canada, including funding for the Windsor-Detroit International Crossing outlined in Chapter 3.2 and funding for highways, bridges and dams located in national parks and along historic canals outlined in this chapter.

Building a New Bridge for the St. Lawrence

Economic Action Plan 2014 proposes to provide $165 million over two years on a cash basis to advance the construction of a new bridge for the St. Lawrence.

The Champlain Bridge between Montreal and the South Shore of the St. Lawrence River is one of the busiest in Canada—used annually by about 50 million vehicles—and is a key crossing for the Montreal area, supporting the movement of people and goods. In order to ensure safe and efficient transportation for commuters, public transit users and commercial vehicles, the Government will build a new bridge over the St. Lawrence by 2018 to replace the existing structure.

This project will be delivered through a public-private partnership, which will allow the Government to harness the innovation of the private sector to deliver better value for money for taxpayers and users, and build the bridge on budget and on time. PPP Canada will provide advice to support the delivery of the project.

Tolls will be instituted on the new bridge when it opens to traffic in order to recover the cost of construction and pay for operating and maintenance costs going forward, limiting the exposure of Canadian taxpayers to ongoing costs.

Economic Action Plan 2014 proposes measures to ensure the construction of the bridge by 2018, including $165 million over two years on a cash basis for procurement and project delivery activities for the new bridge for the St. Lawrence. The activities will include engineering studies, property acquisition and utility relocation, and project management functions. The procurement process to select a private sector concessionaire will be launched in 2014.

Rehabilitating and Improving Montreal Bridges

Economic Action Plan 2014 proposes to provide $378 million over two years on a cash basis to advance the repair and maintenance of federal bridges in the Greater Montreal Area.

The Jacques Cartier and Champlain Bridges Incorporated (JCCBI) manages federal bridges and other transportation infrastructure in the Greater Montreal Area, including the Jacques Cartier and Champlain Bridges, the Bonaventure Expressway, the federally owned portion of the Honoré Mercier Bridge, the Melocheville Tunnel and the Champlain Bridge Ice Control Structure. The safety of federal bridges in Montreal is important to the Government of Canada, and the Government is taking all necessary measures to ensure safe passage for users.

These structures were built in the 1930s and 1960s and require rehabilitation and repair measures over time. Economic Action Plan 2014 proposes to provide $378 million over two years on a cash basis to JCCBI to fund repairs and to operate federal bridges and related structures in Montreal to support their ongoing safety.

Funding for Atlantic Ferries

Economic Action Plan 2014 proposes to provide $58 million over two years to support the continued operation of the Digby, Nova Scotia–Saint John, New Brunswick, Wood Islands, Prince Edward Island–Caribou, Nova Scotia, and Îles de la Madeleine, Quebec–Souris, Prince Edward Island ferry services.

The Government of Canada provides vessels, terminal facilities and operating support for ferry services between Digby, Nova Scotia and Saint John, New Brunswick, Wood Islands, Prince Edward Island and Caribou, Nova Scotia, and Îles de la Madeleine, Quebec and Souris, Prince Edward Island. In 2013, the Government announced that it would purchase a replacement for the MV Princess of Acadia used on the ferry service between Digby and Saint John. Economic Action Plan 2014 proposes to renew the Government’s commitment to the three ferry services by providing $58 million to support their continued operation over the next two years.

Improving Small Craft Harbours

Economic Action Plan 2014 proposes to provide $40 million over two years on a cash basis to accelerate repair and maintenance work at small craft harbours across Canada.

Through its Small Craft Harbours Program, Fisheries and Oceans Canada operates and maintains a network of small craft harbours to provide commercial fish harvesters and other harbour users safe and accessible facilities.

Economic Action Plan 2014 proposes to invest an additional $40 million over two years on a cash basis in the network of small craft harbours. This investment will support the creation of jobs in coastal communities and help ensure that harbour facilities meet the needs of commercial fishermen.

Improving Regional and Local Ports

Economic Action Plan 2014 proposes to provide $33 million over two years to support the divestiture of regional ports to local interests and the continued operation and maintenance of federally owned ports.

Canada’s ports are important transportation and economic gateways, connecting communities to markets around the world. As communities and port users are best placed to determine local needs and service level requirements, the Government is divesting regional and local ports to the users and local interests best placed to operate them. To date, Transport Canada has divested or otherwise transferred 180 regional and local ports that it owned until the late 1990s, with 60 ports remaining under federal ownership. Economic Action Plan 2014 proposes to provide $33 million over two years to support the further divestiture of remaining port facilities and the continued operation and maintenance of federally owned ports.

Moving Forward With the Pickering Lands

The Government of Canada is committed to both the economic development and conservation of 18,600 acres of land it owns in Pickering, Ontario. In June 2013, the Government announced that 8,700 acres of this land will be retained for a future airport. A total of 5,000 acres is being transferred to Parks Canada for use as part of Rouge National Urban Park to build on the Government’s strong record of conservation. The balance of roughly 5,000 acres is set aside for regional economic development.

In 2011, the Government of Canada released a needs assessment study that indicated an additional airport in the Greater Toronto Area will be needed as early as 2027 and that Pickering Lands is the prime location. The Government has identified the southeast quadrant of the existing lands as the site to be protected for a future airport.

The Government is consulting with a broad range of stakeholders on the future of the Pickering Lands. To date, over 600 submissions have been received from the public. In the coming months, the Government will hold a series of roundtables with local stakeholders to ensure development benefits local businesses. The Government remains committed to managing the Pickering Lands in a manner that will preserve a high quality of life in the region, accommodate continued growth of aviation in the Greater Toronto Area, and provide opportunities for economic development and job creation.

Notes: A dash indicates an amount of less than $500,000. Totals may not add due to rounding.

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