ONTARIO NORTHLAND TRANSPORTATION COMMISSION
CONTENTS
Tuesday 11 February 1992
Agency Review
Ontario Northland Transportation Commission
Mac Sinclair, chairman
Peter Dyment, president
Cindy Boston, vice-president, administration and development
STANDING COMMITTEE ON GOVERNMENT AGENCIES
Chair / Président(e): Runciman, Robert W. (Leeds-Grenville PC)
Vice-Chair / Vice-Président(e): McLean, Allan K. (Simcoe East/-Est PC)
Carter, Jenny (Peterborough ND)
Elston, Murray J. (Bruce L)
Frankford, Robert (Scarborough East/-Est ND)
Grandmaître, Bernard (Ottawa East/-Est L)
Hayes, Pat (Essex-Kent ND)
Jackson, Cameron (Burlington South/-Sud PC)
McGuinty, Dalton (Ottawa South/-Sud L)
Marchese, Rosario (Fort York ND)
Waters, Daniel (Muskoka-Georgian Bay/Muskoka-Baie-Georgienne ND)
Wiseman, Jim (Durham West/-Ouest ND)
Substitution(s)/Membre(s) remplaçant(s):
Bisson, Gilles (Cochrane South/-Sud ND) for Mr Wiseman
Brown, Michael A. (Algoma-Manitoulin L) for Mr Elston
Farnan, Mike (Cambridge ND) for Ms Carter
Clerk pro tem / Greffier ou Greffière par intérim : Carrozza, Franco
Staff / Personnel: Pond, David, Research Officer, Legislative Research Service
The committee met at 1006 in committee room 2.
AGENCY REVIEW
Resuming consideration of the operations of certain agencies, boards and commissions.
ONTARIO NORTHLAND TRANSPORTATION COMMISSION
The Vice-Chair: This morning we are dealing with the Ontario Northland Transportation Commission. For Hansard, would you give us your names and the positions you hold.
Mr Sinclair: My name is Mac Sinclair. I am chairman of Ontario Northland Transportation Commission. With me is Mr Peter Dyment, president of Ontario Northland, and Cindy Boston, vice-president of administration and development at Ontario Northland.
The Vice-Chair: I presume you have an opening statement you would like to make?
Mr Sinclair: I would just like to perhaps reinforce some of the information members of the committee have received, as I understand it.
Ontario Northland is an agency of the province of Ontario. It has existed since 1902. It provides essential telecommunication and transportation services throughout parts of Ontario. The services are manifested in the form of freight trains, passenger trains, buses, aircraft and marine services, ferry boats principally, in the Bruce Peninsula area and the Manitoulin area. We also have a very strong and busy telecommunications business that runs essential telecommunications services from North Bay to Moosonee and beyond, up to the Hudson Bay coast.
We employ approximately 1,500 people on a regular basis and some of those people work in Toronto, a very few. A lot work in North Bay and up the northeastern corridor. We also have employees who work in the Moose Factory area, Moosonee and Timmins and beyond, to the Lakehead. Essentially it is an agency that operates, and the agency is represented throughout the north.
The Vice-Chair: Thank you. Questions from members. Mr Grandmaître, do you have anything to start with?
Mr Grandmaître: Not for now, Mr Chair.
The Vice-Chair: Okay. Anything from the government side?
Mr Marchese: Is that the presentation or is there any other information that members want to add in terms of other background or issues they are confronting on a regular basis?
The Vice-Chair: I asked Mr Sinclair if they had an opening statement; he said they had not.
Mr Marchese: That was it?
The Vice-Chair: He made a small presentation, so it is up to the committee members now if they want to proceed and ask questions. That is my understanding, unless Mr Dyment or Ms Boston would like to make some comments.
Mr Dyment: We will just leave it the way it is.
The Chair: Mr McLean, I know you have some questions.
Mr McLean: Yes, I have. Is the Ontario Northland Transportation Commission looking at hauling, in cooperation with CN or CP, garbage to Kirkland Lake?
Mr Dyment: We are not. We did at one time work with CN and CP. Both those plans have been shelved.
Mr McLean: At this stage you are not interested in playing a part in that transportation network I understand CN and CP have been dealing with?
Mr Dyment: We are interested in transporting anything into the north or out of the north. We are very competitive and can do a good job. It is my understanding that there will not be such a haul.
Mr McLean: Your transportation link with regard to Star Transfer is not a money-making proposition. With the amount of money that is being lost every year, why are you continuing to pursue the transportation with regard to Star Transfer?
Mr Dyment: The feeling at the moment, and it has been reviewed over the last few years, has been that there needs to be trucking competition in the north. It is also felt that the northern trucking company should be located in the north, headquartered in the north and run from the north. Star fulfils that objective quite nicely.
Mr McLean: I would like to move on to some of the things we discussed yesterday, in camera, with regard to the information we have on the ONTC purchase from Gray Coach and the approval from the Ontario Highway Transport Board. Is that approval a binding agreement, whether it is commercial or not?
Mr Dyment: In this regard I would seek some direction from the Chair. I understand this particular transaction has been sent to cabinet in the form of a petition, so I will need some guidance as to whether the Chair would like me to answer these questions or would like them done in camera.
The Chair: I have a memorandum before me for the information of the members of the committee and the witnesses in respect to the possibility of this matter being raised. The subject could possibly be declared sub judice. I think that if we want to pursue this area, and the witness has suggested this, rather than my making a ruling on it, we may indeed move in camera to discuss this. I know it was the subject of significant in camera discussion yesterday. Perhaps that would be the appropriate way to deal with it.
Mr Marchese: Mr Chairman, I suggest we leave towards the end whatever is to be in camera and let the public discussion go as far as we can let it.
The Chair: I have no problem with that. How does the committee feel?
Mr Grandmaître: That is fine with me.
Mr McLean: Yes, I think that is fine.
The Chair: All right. Can we move into another area for now?
Mr McLean: I can move into another area with regard to that. I had a phone call yesterday from a tour company, Bob-Kat Tours. I asked them to fax me what information they had with regard to their operation. They are a long-standing member of the Ontario Motor Coach Association. They are concerned that you are going to be setting up and operating charter tours out of the city of Barrie. Would that be correct?
Mr Dyment: That is correct.
Mr McLean: Therefore, you would then be offering tours to US destinations and out-of-province tours?
Mr Dyment: From Barrie, yes.
Mr McLean: Do you think that it is appropriate to be spending taxpayers' dollars subsidizing a motor company, ONTC, when private enterprise is in competition with it?
Mr Dyment: No, I think it is inappropriate to spend taxpayers' dollars for that purpose. We have no intention of spending taxpayers' dollars.
Mr McLean: I think I can get into this area, with regard to the Owen Sound-Collingwood corridor. Those routes are not part of what you are taking over?
Mr Dyment: I guess I would seek direction from the Chair. Are we not getting indirectly into what you suggested directly should go in camera?
The Chair: I was not paying attention to the line of questioning. I will have to look to Mr McLean, whether he feels it was touching on the same area.
Mr McLean: It may be. I guess the other question I can ask, then, is with regard to transfer of tickets from one company to another, the area of cashing in, whether Penetang-Midland Coach Lines or another. My understanding was that the tickets were not transferable. We have letters from a young lad indicating a problem he had. I would like to know if that situation has been cleared up or not.
Mr Dyment: There is no formal agreement between bus companies in the province as to interlining of tickets. If you give me the specific information, I could look into it.
Mr McLean: You are not aware of the specific information with regard to transfer from one ticket company to another?
Mr Dyment: No. There is no formal agreement between companies. If you could let me know who the young lad is and where he tried to travel, I will get back to you with the details.
Mr Jackson: If I could go back to two previous questions, you indicated it would be inappropriate to conduct tours outside of Ontario. Did I hear you correctly?
Mr Dyment: With taxpayers' money.
Mr Jackson: I have a copy of your 1990 motor coach brochure. There are 17 tours listed here and only three of them are in Ontario; the rest are outside of Ontario: Nashville, Arizona, Newfoundland, Washington, etc. Are you indicating you can warrant that none of those are operated with any support or assistance from the taxpayers of this province?
Mr Dyment: Yes.
Mr Jackson: How can you do that?
Mr Dyment: I would have to refer you to our financial results and get back into the question Mr McLean wanted to get into with regard to commercial and non-commercial in bus operations, which I am prepared to do, under the guidance of the Chairman, in camera.
The Chair: Personally, I am confused as to why this line of questioning would infringe on that subject area.
Mr Dyment: Fair enough. Our bus operations are a commercial operation which, by memorandum of understanding with the province and by guidance from the Management Board of Cabinet directives, must not be parasitic on public funds. They must be sustained entirely by revenue generated by the Ontario Northland Transportation Commission, and they are.
Mr Jackson: If you are operating buses, period, regardless of whether they leave the province or not, some routes or lines will be more lucrative than others and some you will operate at a loss. Are you assuring us that every one of your lines operates at a profit?
Mr Dyment: Bus companies, certainly in Ontario, and probably in North America, operate scheduled passenger runs, and Ontario Northland is not unlike those other companies in that those passenger runs are not lucrative. In order to subsidize the passenger runs we run charters and tours. These charters and tours are more lucrative than running regular scheduled passenger runs. They in effect assist us in providing the regular passenger service.
Mr McLean: As to the memorandum of understanding with regard to the Ontario Northland Transportation Commission, I thought it was understood that it was to provide services to northern Ontario mainly. Was that not the case?
Mr Dyment: Not entirely.
Mr McLean: What is the memorandum of understanding between the Minister of Northern Development and the ONTC?
Mr Dyment: It is an 18-page document which articulates the way we do business and the way we interact with government.
Mr McLean: So the mandate is also to supply services in southern Ontario?
Mr Dyment: Yes. Ontario Northland provides the link between communities in the north, and provides the link from northern Ontario to the world. In order to provide that link, we must somehow connect with southern Ontario.
Mr McLean: You are saying, then, that you could run a corridor from Windsor to Ottawa without getting a new licence.
Mr Dyment: I do not know how that would provide a link to northern Ontario.
Mr McLean: I thought you just finished saying that it provides a link to anywhere in North America.
Mr Dyment: To the world, and in order to connect to the world we must connect from north to south Ontario.
Mr McLean: Could you not go from northern Ontario to Ottawa to Windsor?
Mr Dyment: We could, but I think that would be stretching it.
Mr McLean: The fact is that it could happen but it does not.
The Chair: Does a member of the government caucus wish to ask a question at this point?
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Mr Waters: I have a couple of questions. I just did a tour of the north on snowmobile, gentlemen. I have some concerns because the rules are inconsistent. I checked with several snowmobile clubs and they are concerned. After all, I represent tourism. When I see in a particular area that to have a crossing on ONR tracks a person has to sign away his life and everything his grandchildren and great-grandchildren will probably ever have if there should ever be an accident, yet in other areas they do not -- that is, these people have to sign an indemnity agreement saying that any losses, damages, costs, demands, claims, charges, expenses, howsoever caused, that these people will have to pay that. That was in one area. I checked throughout the north. These were the only people. Can you explain why this would be happening in one area?
Mr Dyment: To the best of my knowledge, we only have two snowmobile-crossing agreements and they are identical.
Mr Waters: I crossed your track several hundred times this winter.
Mr Dyment: We have just discovered a trespasser.
Mr Waters: You mean that you do not allow snowmobiles to cross your tracks, where CN and CP do?
Mr Dyment: No, we allow them to cross our tracks if they sign an agreement. To the best of my knowledge, we have two signed agreements.
Mr Waters: That is this agreement.
Mr Dyment: Yes, that sounds like the agreement.
Mr Waters: This was the only one that had this that I could find in my travel to the north, which is the indemnity part of the agreement, which is totally separate, a separate signed document.
Mr Dyment: By the same people?
Mr Waters: It was only the one club that had to sign it that I had found. I was just curious about that.
Mr Dyment: We are addressing the question of snowmobile crossings right now. We are working with the Ontario Federation of Snowmobile Clubs, attempting to come up with a standard form of agreement so that other clubs may sign an agreement with Ontario Northland, but at the moment those other clubs have not approached Ontario Northland. Any of the crossings you may have seen were simply trespassing.
Mr Waters: The other question I have is, how long would you say it should take after you sign one of these agreements before you actually receive a copy of it?
Mr Dyment: I am afraid I cannot comment on the legal process.
Mr Waters: Is it about two months? You should have something within two months after you sign it, you should get a copy of an agreement?
Mr Dyment: I would think so.
Mr Waters: That is interesting, because these people have waited over two months so far.
Mr Dyment: And they do not have an agreement?
Mr Waters: They do not have a copy of it, not yet. They signed it and they never ever received a copy of the formal agreement.
Mr Dyment: If you could give me their names, I will certainly get back to them and you.
Mr Waters: This agreement is updated to this year. I would like that back because that is the only copy I have at this point.
We have tried to talk about PMCL and Ontario Northland, and you would like to do that in camera. What about Hammond Transportation and its concerns? Would you sooner do that in camera too?
Mr Dyment: I have no --
Mr Waters: They have some major concerns about your getting into the charter business and going south, picking up people in Muskoka and the Simcoe county area. They have no concerns with your chartering to the north; it is to the south that they are concerned about.
Mr Dyment: I have personally talked to Hammond on two occasions and assured them that we will do nothing that Gray Coach Lines did not do. They have my assurance.
Mr Waters: Did Gray Coach charter to the south?
Mr Dyment: To my knowledge, no.
Mr Waters: Okay, so you are not going to do that, which will relieve those people.
I understand that you do not wish to talk about the PMCL thing until we are in camera, so I move on to another one. The new train coming south, is it running now?
Mr Dyment: Yes, as of February 9.
Mr Waters: I understand they no longer have a dining car.
Mr Dyment: They have a food service car.
Mr Waters: Yes, a snack car.
Mr Dyment: A snack car, yes.
Mr Waters: Was that done for financial reasons, the downgrading of the food service?
Mr Dyment: Yes, it was.
Mr Waters: I cannot tell you who, because they do not wish their names to come forward, but if I were to tell you that someone from Ontario Northland said there was $6,000 to $8,000 a year wasted in the purchasing price of food and overpayments enough to make that dining car unprofitable, would that surprise you at all? They did say they told the management and that the management turned a blind eye.
Mr Dyment: I deal with hundreds of hidden recommendations a year; it is difficult for me to get at. I can tell you that in 1991 the dining car on The Northlander lost $800,000. That is a subsidized service. The taxpayers of Ontario paid $800,000 for travellers to eat. If you would say we could have saved $8,000 on food I would love to know how. I can assure the committee that if it is a prudent, open tendering system I will make sure we save that $8,000. But our task was to save more than $8,000. We tried to cut the $800,000 back. We think we have cut it back by about $500,000 by going for a snack car.
Mr Waters: How are you going to deal with the staff?
Mr Dyment: We have already dealt with the staff.
Mr Waters: I read this and it is a 12-hour trip, so the staff are on the train for 12 hours?
Mr Dyment: They will be, yes.
Mr Waters: They have to work for 12 hours. Do they get time and a half for three or four hours?
Mr Dyment: We have negotiated the arrangement for the staffing of the train with their union. It was done in a spirit of cooperation, an open and frank negotiation.
Mr Waters: Do you have a permit for excess hours?
Mr Dyment: I do not believe we need one.
Mr Waters: Then you are different from most places of employment. We used to have to have them.
Mr Dyment: No, I think there is an averaging system that can be employed.
Mr Waters: You have to have a permit to allow for an averaging system.
Mr Dyment: We come under federal jurisdiction. The federal law does not require that.
Mr Waters: Okay, so what I understand is that these people work for eight hours and somewhere in there you close the dining car or the snack car for four hours or something?
Mr Dyment: That is not our intention. We would open a snack car when it leaves its originating point and close it prior to its terminating point.
Mr Waters: Can you explain to me how these people, what kind of agreement, or is that --
Mr Dyment: No. I can file the agreement with the committee if you wish.
Mr Waters: I would appreciate that. I would like to have a better understanding of that. It is difficult, because what I want to talk about is the part that I cannot. I will pass for now.
Mr Grandmaître: I would like to go back to the Star Transfer Ltd, or the trucking division of ONTC. In your opening remarks, Mr Dyment, you mentioned that you were very, if I can use the word, concerned about using taxpayers' dollars, that you should not be using tax dollars to provide competition. Did you say that or did I misunderstand you?
Mr Dyment: I believe in that principle. I hope I said it.
Mr Grandmaître: The Star Transfer trucking business has been losing money for a good number of year; am I right?
Mr Dyment: Yes, you are right.
Mr Grandmaître: What other competition is there in northern Ontario?
Mr Dyment: The competition for the type of business we are in that I consider to be licenced competition would be Manitoulin Transport and Trans Provincial Freight Carriers.
Mr Grandmaître: If you were to eliminate that division, do you not think these people can do as good a job or maybe a better job?
Mr Dyment: First, I do not believe they would go to all the little locations that Star Transfer goes to. Second, if they pulled out I believe the north would lose a head office.
Mr Grandmaître: The north would lose?
Mr Dyment: Yes, Star Transfer is operated out of Timmins and does all its billing and clerical work and decision-making in Timmins. It is a Timmins-headquartered organization. I believe that if we sold Star, we would probably end up selling it to Kingsway Transports or Canadian Pacific or somebody like that and it would be operated out of the south.
The Chair: I am going to allow a brief supplementary for Mr Brown.
Mr Brown: On that point, Mr Dyment mentioned that Star serves communities that are not serviced by private carriers. I just wonder if we could have a list of those communities that are not serviced by the private sector.
Mr Dyment: Yes, I can provide that list.
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Mr Grandmaître: So in other words, Mr Dyment, you specialize in areas where the competitors, if I can call them that, or the private sector does not provide services. That is the type of trucking business you provide in northern Ontario.
Mr Dyment: No, I believe I have left an illusion with the committee if you have interpreted that. We provide a service where the other carriers also provide a service. We go to some communities that they do not go to in doing so, but the majority of our traffic comes from places like Timmins, Kirkland Lake and Tri-town, where they also serve.
Mr Grandmaître: Why would you be in the business as a losing factor? Why would you stay in this kind of business? You are using tax dollars.
Mr Dyment: No, we are not using tax dollars. It is coming out of our commercial revenue. We are not allowed to use tax dollars. As a matter of fact, we do not have the mechanism for using tax dollars, but this particular enterprise must be subsidized by our telephone company or by our freight train operations.
As I mentioned, it is an northern Ontario company headquartered in the north. If it did not operate, one northern Ontario company would be pulled out of the north and there would be less competition.
Mr Grandmaître: Let's go on to your bus division. Personally, going through my notes, I think you are competing against the private sector and again you are losing money year after year, so why would you stay in business using tax dollars to offer competition to the private sector?
Mr Dyment: First of all we are not using tax dollars and, second, there are no other bus companies up there.
Mr Grandmaître: Where are you getting your subsidies?
Mr Dyment: From the telephone company, from the freight train -- I want to reiterate that there are no other bus companies up there. If Ontario Northland did not run a bus to Timmins there would be no buses running to Timmins. If Ontario Northland did not go to Hearst, Opasatika and Latchford those people would not have a bus.
Mr Grandmaître: Granted, apparently you are providing good services, but I am talking about other lines where the private sector is servicing and yet you are trying to compete with these people.
Mr Dyment: We have operated Ontario Northland bus lines for many years. We started in the 1930s and we have operated in the north solely as a northern Ontario bus company. The northern Ontario population is not growing; it is very sparse and very spread out. The people in the north want to go to Toronto and beyond and we provide that connection. We wanted to better that connection so we picked up Gray Coach, which was providing a bus operation in Ontario, and provided a link from the south to the north.
We have not added to competition; we have simply picked up a line which was providing a link to the south. We are not adding buses and we are not adding competition, but we are providing a better connection for the people of the north and we are adding to the company, which you suggest is not doing well financially, by adding a good financial subsidy to it.
The Chair: Are you finished, Mr Grandmaître?
Mr Grandmaître: For the time being, yes.
The Chair: Mr Jackson, do you have a question?
Mr Jackson: I will yield to my colleague and then if there is time I would like to --
The Chair: We have all day.
Mr McLean: That is great. We will not talk about the agreement. What I would like to talk about is the interline agreement -- you claim there was no agreement -- between your organization and PMCL with regard to tickets being sold in Orillia, Barrie or that type of thing. You have no agreement where you would honour claims for their tickets.
Mr Dyment: We do not have a signed agreement with any bus company in Ontario for the interchange of tickets.
Mr McLean: Do you interchange your tickets with all bus lines?
Mr Dyment: No, we do not.
Mr McLean: Which ones do you not?
Mr Dyment: The ones that compete with us.
Mr McLean: Who are they?
Mr Dyment: I am afraid I do not have the list. It would be Greyhound in some locations. Obviously it was Gray Coach; it is not now.
Mr McLean: I thought the industry operated under an honour system for accepting interline tickets between carriers.
Mr Dyment: It is my understanding, and I cannot speak for the entire industry, that there are various grades of honour.
Mr McLean: There was an agreement drawn up by you for PMCL to sign in order to deal with the interline tickets at Barrie, and there was some figure in there of about $12,000. Do you recall the agreement that was drawn up?
Mr Dyment: I think we are getting into this area where --
Mr McLean: I am not talking about the bus lines; I am talking about working within the framework of what you already have, and within that framework I want to talk about interline tickets. That has nothing to do with whether you purchased it or did not purchase it. I think this is within the mandate of all bus companies to deal with. I am asking you, what bus lines do you interchange tickets with and which ones do you not? I would think you would know.
Mr Dyment: We interchange passengers with Voyageur, Auger and Greyhound in North Bay, with Auger in Kirkland Lake, with Grey Goose and Greyhound in Hearst, with PMCL in Barrie and I would think with a multitude of companies in Toronto.
Mr McLean: Was it indicated to the staff in Barrie and Orillia that they were not to leave up any signs or advertisement by PMCL in order for them to compete?
Mr Dyment: No.
Mr McLean: No one was told not to interline, the staff in Orillia.
Mr Dyment: In Orillia?
Mr McLean: Yes. The city of Orillia at the train station there; that is where the terminal is. Were the staff there not told that they were not to promote PMCL?
Mr Dyment: I have no idea. Orillia is not our terminal.
Mr McLean: Whose terminal is it?
Mr Dyment: To the best of my knowledge, it is owned by the city. Perhaps it is private; I do not know. It is an agency, as far as we are concerned. We pay somebody a contract to operate our buses.
Mr McLean: I see. I will pass for now.
Mr Marchese: Mr Dyment, I want to speak briefly on the role of the ONTC. I want to say that I recognize the paradoxical nature of a crown corporation where, if you are losing money, you get attacked by different sectors of society that say you are running an operation where you constantly lose money, and if you are making money you get attacked by perhaps the same sources for either making money or competing with the private sector. It is a no-win situation, in many cases.
I really believe that when a crown corporation does well, runs efficiently and makes money, it is a good thing. If it provides a service to unserviced areas or unserviceable areas by the private sector, it is a good thing to provide; otherwise people would be without the service. I want to say that I support the crown corporation being in the sector where it does make money. I make that as a statement, and I want you to comment on those two things. Do you see your role as continuing to provide a service to those areas or to those services that do not make money?
Mr Dyment: Yes, I do. I know that Ontario Northland was established in 1902 to provide the communicating links between the communities in the north and to provide a communicating link from the north to the balance of the world. The communicating links we used initially were a telephone company and a train. As other links between communities and from the north to the world were needed we added buses, boats, planes and trucks. We do not differentiate in our service between profitable and non-profitable sources. We pick up from all communities with our trains, buses, boats and planes.
We do, by our memorandum of understanding with the government, become a commercial organization. We are essentially a commercial organization. Our revenues have to exceed our expenses, and there are some areas, such as passenger trains, where we just cannot make revenues in excess of expenses and the government has said, "We will pay you under contract to run those services," and we do run some services under contract for the province.
But our bent is to be commercial and to make money, and there is a good reason for that: The gap between revenues and expenses, the so-called profit, is turned back into the north and becomes our capital expenditure. That is how we replace our plant, that is how we upgrade our plant, that is how we expand our services and that is how we help develop the north.
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In recent years we have gone back to an earlier concept and become a developer. We have built a building in Kirkland Lake, for instance, which has been devastated by fires and devastated by the loss of mines. There was just a total lack of confidence in Kirkland Lake, so we built a bus station and an office building which is being occupied. It showed confidence, and we are doing it on a commercial basis. We will get our return on investment.
We are trying to develop railway lands in downtown Timmins. We have built a badly needed motel and restaurant in Cochrane to service the tourist trade -- not to lose money but to make money -- but nobody else would come to Cochrane and do that. The Cadillac Fairviews of this world do not want to build in Cochrane, so Ontario Northland is doing it. We are doing it with the gap between revenues and expenses, so our commercial bent is beneficial to the north.
Mr Marchese: Okay. On the point of the honour system that was raised by Mr McLean, could you just amplify an answer to the previous question, that in some cases you honour tickets from other carriers and in some cases you do not? It would seem to me that is a traditional practice that has been historical, and if we do not honour those tickets from other carriers, it presents a great deal of difficulty to a lot of passengers who go from one place to the other. Could you explain as clearly as you possibly can why it is that we would honour some and not others?
Mr Dyment: If we were running a bus from, let's say, North Bay to Kirkland Lake and the ABC Co is running a bus from North Bay to Kirkland Lake, and a passenger showed up at the terminal, the passenger has the option of travelling on our bus or their bus. We would expect if he or she bought a ticket for ABC's bus that he or she would get on ABC's bus and not ours. That is where we do not honour them.
Where we are the interconnector -- for instance, we interconnect at North Bay with Voyageur, Auger and Greyhound. You may want to travel from Toronto to, let's say, Sudbury via North Bay. We would take you to North Bay with anybody's ticket and transfer you, because we do not travel to Sudbury, to whatever bus line your ticket represented. We would have no difficulty with doing that, so passengers are not in any way prejudiced at all. But we would expect, if you show up at our North Bay terminal and there are two buses leaving, that you would get on the bus for the company that provided you with the ticket.
Mr Marchese: But is this not an honour system that is similar to or parallels situations in other parts of the country? Is this not something that is practised?
Mr Dyment: Oh, absolutely. We just bought Gray Coach Lines and we bought its honour system.
Mr Marchese: Right. But you were explaining why it is that you do not need to honour certain tickets along similar lines when someone is offering the same service. But that practice of honouring tickets, whether or not there are similar routes that other carriers go to, is that not a practice that is happening or honoured across the country in general?
Mr Dyment: My only experience can be Ontario Northland since 1930; the honour system that has prevailed up there, which I am familiar with, is exactly as you have described. The only other honour system I can describe to you is that which prevailed in southern Ontario, and we bought that particular honour system from Gray Coach. So I would say whatever the industry is doing, we are doing.
Mr Marchese: Okay. I think Mr Waters has another question attached to this, but I have two other questions. The ONTC is planning to replace trains between Toronto and the north with state-of-the-art, all-electric coaches. We understand that as a result of that you will need less staff. The question many workers would ask there is, how could you minimize the layoffs, or are you planning to train a lot of the workers who potentially could be laid off so that they can fit into other parts of the services that you provide?
Mr Dyment: As a result of this particular move we needed 13 or 14 fewer people on what we call our onboard service personnel; these are people who serve on the dining cars. Of those 13 or 14 people, there are three with less than a year's service who will be laid off. We have provided jobs for or are retraining the balance or are offering early retirement in every case. So the only people at risk are those three who have less than one year's service. I also have the assurance of the union that it is completely happy with the way we treated them.
Mr Marchese: That is good. How would you describe labour relations between the ONTC and the workers, just as a general question?
Mr Dyment: We have 19 unions. We have some 20 or 21 agreements, contracts. At the moment, for instance, we are negotiating a contract with the railway, which is the biggest part of our enterprise in terms of employees, and we are negotiating with some 700 railway employees. Those 700 railway employees have 12 unions. Six of them work in our shops and represent one third of the railway employees, and they are headed by the Canadian Auto Workers; I would say that negotiations are going terribly. Two thirds of them are represented by six unions and I would say negotiations are going exceedingly well. There is good-faith bargaining, there is frank discussion, there is a good interchange between us.
So I can only answer that by saying that negotiations are going on. Two thirds of our employees are represented by unions for which negotiations are going exceedingly well and one third are represented by the Canadian Auto Workers and they are not going well at all.
Mr Marchese: Because?
Mr Dyment: My view is that Canadian Auto Workers prefers to bypass the process of conciliation, for instance, and wants to get right to the strike point, whereas the other unions would like to make a deal with management to see them continue their employment.
Mr Marchese: Perhaps some other members might have questions directly related to them. Are you expecting any layoffs in the near future?
Mr Dyment: No, we are not. We had a major loss of product in early 1990 when our iron mines closed down and it was necessary to cut our staff by 120. We did it with only eight or nine layoffs. We did it with an early retirement scheme and by relocation of people, so our layoff record has been very good. If our product shipping stays where it is right now, I do not foresee layoffs.
Mr Marchese: Okay. Thank you.
Mr Brown: I would first like to express my appreciation for Mr Dyment and Mr Sinclair being here. Of course, being the critic for Northern Development for the official opposition, I am quite aware of its activities and I know most northerners are very appreciative of the ongoing efforts by the Ontario Northland Transportation Commission on our behalf. I know that my constituents in particular were very happy to be the beneficiaries of flights of norOntair within the last year and a half -- I cannot really recall the time frame, but it was not very long ago -- and we certainly appreciate that service. So I am coming to this committee hoping that Ontario Northland recognizes how northerners feel about its service and understand that we as northerners appreciate very much what the commission is attempting to do.
I have some questions, however, and the first one relates to a letter that our research sent to Mr O'Connell on January 6. I suspect that time constraints have not provided Mr O'Connell an opportunity to respond to the letter yet, and I am just wondering if we could get a response now. This letter was sent by one of our policy analysts, Michael Brooks, and essentially what it asks is if norOntair Ltd is a separate entity under the direct control of the Ontario Northland Transportation Commission. I suspect that is obviously true.
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The second question is, "with respect to a schedule 2 agency, such as the Ontario Northland Transportation Commission, the terms of any business contract entered into by the commission with any private individual, operator or business are strictly confidential and/or personal information as defined and protected under the Ontario Freedom of Information and Protection of Privacy Act." Is that true? Are all the terms of contracts that the commission enters into private information subject to the Freedom of Information and Protection of Privacy Act?
Mr Dyment: Yes.
Mr Brown: So that no person associated with the commission can release the terms of a contract without the consent of the person with whom the contract has been entered into?
Mr Dyment: We have to abide by the terms of the legislation.
Mr Brown: Well, that is puzzling to me, because we have from the Northern Development estimates a release of some very specific information regarding contracts with companies. In a response to Mr Turnbull at estimates, we have a number of statements by the Minister of Northern Development, who, for example, when talking about Bearskin Air says Bearskin "representatives also signed a contract which said very clearly they would not run Bearskin planes against the norOntair planes in and out of Kenora. They have been doing that in direct violation of a contract they signed with us," meaning Ontario Northland, "for the last four years," which to me, in my humble opinion and our legal counsel's opinion, directly discloses the terms of a contract with a private sector company.
Miss Martel does this in a number of other instances in that Hansard and I am not going to read those for the record, but they are a matter of public record. We find here a minister of the crown disclosing some information. I wonder how you would deal with that. If one of your employees does that, how does that work? Do you have an officer responsible for freedom of information and privacy?
Mr Dyment: Yes, we do.
Mr Brown: So from all requests, he would have to vet those and determine whether they are within the terms of the act before they could be released as private information on a contract?
Mr Dyment: Yes.
Mr Brown: If, in fact, he has a problem -- or she. Is it Mr O'Connell?
Mr Dyment: It is Mr O'Connell.
Mr Brown: So if he has a problem with that act, what is the process? If he is not too certain, would he send it on to the Information and Privacy Commissioner?
Mr Dyment: No, he would handle it. We do not have problems with the act. We have handled a number of requests, as you will appreciate, and we make our interpretation of the act and operate accordingly. There is an appeal process for the people requesting information and then, of course, when they appeal, we get involved through the privacy commissioner. We follow the act, we interpret it ourselves, and if the requester feels that we are wrong, he has an appeal process.
Mr Brown: It seems to me, and I think to any member who will review the Hansard of the standing committee on estimates, that the minister has made direct statements regarding a contract. She has disclosed private information that I understand should not have been disclosed. I am not sure what is appropriate at this time, whether the committee should ask the freedom of information commissioner if he would look into this matter. We are very disturbed that we believe a breach of the act has occurred; our legal counsel believes it has occurred. I am just not too sure where to proceed, but I think if an employee had done the same thing, this would be a far different matter.
Mr Marchese: Mr Chairman, can you direct us in terms of the comments the speaker is making and how that relates to Miss Martel and this discussion?
The Chair: If Mr Brown had made a request, and I am not sure he is posing questions, I think it is certainly something that could be discussed during our deliberations on the report on Northland, but it seems to me that it goes outside of our mandate in respect to taking a look at the operations of the commission. It seems it is something that perhaps could more appropriately be raised in the Legislature, through estimates process or some other avenue, rather than in our deliberations here today.
Mrs MacKinnon: Thank you, Mr Chairman.
The Chair: Obviously, that agreement is not unanimous.
Mr Brown: Thank you, Mr Runciman.
Mr Sinclair: If I might intervene, Mr Chairman. If there is to be a quote of what has been said here, would you quote me? As I am the person responsible, through the commission, for the staff, I would not like the situation raised where a member of the commission is quoted without knowing that is the position of the commission too. I would prefer that any attention be directed at me.
The Chair: I am not sure that all members of the committee really appreciate your concern in this matter. Perhaps you can be a little more explicit.
Mr Sinclair: I just would not want something to come up in the Legislature where they are quoting a member of the staff and getting into a conflict with perhaps a statement of the minister. I would prefer that that quote be directed to me, and I concur with the comments that have been said. I feel that is my responsibility.
The Chair: Mr Brown will take that under consideration.
Mr Brown: Under your direction, I think the line of questioning is probably, you are saying, outside the mandate now. I will respect that, but I think we will probably take it up in camera later on.
The Chair: I have no problem with the line of questioning, simply that a motion or a resolution of this committee requesting the involvement of the privacy commissioner I think would be inappropriate -- stemming from these discussions in any event.
Mr Grandmaître: Mr Chair, is this not part of the operation of ONTC?
The Chair: As I heard Mr Brown, and I do not want to spend a lot of time with this, he was talking about some comments made by the minister and whether indeed they violated the act, and that is not what we are dealing with. We are dealing with a review of the operation of the commission and not the minister's actions, whether they were appropriate or inappropriate. I think another forum and another day is where those kinds of questions should be dealt with.
Mr Brown: What I was trying to discover here was an answer to the letter that we had posed to the commission and we had not received an answer, and I think I have got that. That was quite clearly stated by Mr Dyment and Mr Sinclair. I am perfectly happy with that. I think we now know what the status is under the act and I am not unhappy with that particular response. Obviously, I have some other lines of questioning but I am willing to allow the rotation to continue.
The Chair: Mr McLean, do you have anything more at this point?
Mr McLean: Yes, I have one question. With Dofasco ore mines closed, the ONTC had anticipated about $13 million in revenues and that is lost now because of the shipment of coal to -- is it Hamilton? -- well, anyhow bringing coal south.
Mr Dyment: Iron ore.
Mr McLean: Iron ore. Mr Dyment, last year you admitted that the government's decision would cause financial difficulties for the commission. Could you elaborate on that?
Mr Dyment: I am sorry, which government decision?
Mr McLean: "Last summer, Peter Dyment, the ONTC general manager, admitted that the NDP government's decision would cause financial difficulties for the commission": Northern Ontario Business, June 1991. That is apparently a statement you made in that editorial. Could you elaborate on that?
Mr Dyment: Could you give me some other reference point?
Mr McLean: "The government's decision to prevent Toronto from shipping its solid waste to Kirkland Lake for storage has upset plans for the ONTC's northern railways division. In 1990, Dofasco closed its iron ore mines at Sherwood and Dane. Losing the contract for shipping Dofasco's coal south cost ONR $30 million in lost revenues. The ONTC had anticipated that shipping the garbage would have a lucrative business for ONR." And I read you what the rest of it was.
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Mr Dyment: Yes, and I hope you did not put faith in the statement that says we are shipping coal south. There is no coal in northern Ontario. We have never shipped coal, so the balance of the statement is probably just as accurate. I think what they are referring to is --
Interjection.
Mr McLean: All I am going by is what the research has.
Mr Dyment: Well, they have got coal coming from Adams mine. They have not discovered coal yet in the north.
Mr Brown: We are looking hard, though.
Mr Dyment: We are looking hard, that is all. I would not put too much faith in that article.
Mr McLean: I am only reading what has been presented to me.
The other question I wanted to ask is, do you have a marine operation out of Lake Nipissing?
Mr Dyment: Yes.
Mr McLean: The Chief Commander lost $161,000 last year. Right?
Mr Dyment: Yes.
Mr McLean: What are you doing to turn that around?
Mr Dyment: We are going to do something which is going to upset Nipissing. We are going to discontinue, with one exception, the passenger runs to the French River.
Mr McLean: Where does it run now?
Mr Dyment: It runs to the French River, which is a route it has taken since the 1940s, since it was put on the lake, or its predecessor was put on the lake. It carried tourists and cottagers down the French, and in recent years there just has not been the market for that. It also runs as a charter and tour boat on the lake, and also makes some runs into what we call Callander Bay, which are shorter runs. We will continue those runs.
Mr McLean: You will continue the charter, everything except the run down the French River?
Mr Dyment: That is right.
Mr McLean: How many miles does it go there now, down the French River?
Mr Dyment: Twenty-four miles.
Mr McLean: Twenty-four miles. The other enterprise that you have that is a moneymaker is the Hannah Bay goose hunting camp, which is located near Moosonee. How do people get to that, do they fly in or do they go in by train?
Mr Dyment: There is no train to Hannah Bay, there are no tracks, no roads; it is strictly a fly-in camp. We fly people from Timmins to Hannah Bay. They get to Timmins their own way.
Mr McLean: What are they charged, by the group? Do you have people in there who run this camp? Is that fishing too, or is it just a goose hunting camp?
Mr Dyment: It is for fowl, geese and ducks, and it only operates in the fall. We put a manager in there and local natives are hired to operate the camp.
Mr McLean: How many lines has Greyhound in competition with you?
Mr Dyment: They are in competition between Toronto and Sudbury.
Mr McLean: Just Toronto and Sudbury?
Mr Dyment: Toronto to Sudbury.
Mr McLean: And North Bay, Kirkland Lake, Cochrane, Kapuskasing, that is all Ontario Northland?
Mr Dyment: All Ontario Northland.
Mr McLean: So Greyhound just goes as far as Sudbury, or do they go to the west?
Mr Dyment: They go west, but we do not. They are not in competition with us.
Mr McLean: I see, so the competition is between Toronto and Sudbury.
Mr Dyment: Toronto and Sudbury.
Mr McLean: Do they stop in Barrie and Orillia?
Mr Dyment: No. They go on Highway 400 and then Highway 69.
Mr McLean: So they are an express direct route, more or less?
Mr Sinclair: Well, as direct as that may be.
Mr McLean: I can ask you this question: Is the outstanding remittance to funds owing still outstanding with PMCL? You have never paid them for interline funds?
Mr Dyment: I hope we have not, but I am afraid I do not know what you are talking about.
Mr McLean: Well, this letter on December 9 to the Premier is from Henderson in Penetanguishene, and Mr Waters and myself had a copy of this letter. It was addressed to the Premier with regard to this young man who got his ticket in Midland and was going to North Bay, and then he wanted to go back the same weekend to Port Sydney. He had bought his ticket in Midland and when he took a taxi to get to Northland bus terminal in North Bay, the ticket was no good. This young lad bought his ticket in Midland for the complete trip he wanted. Due to the fact that you will not interchange tickets, this young lad luckily had $20 in his pocket to buy another ticket, and this individual is a little upset that they could not interchange.
I think the stance that you are taking with regard to interchanging tickets is not acceptable to the people of the province who want to travel without worrying about buying individual tickets. What comments do you have on a letter like that?
Mr Dyment: On a letter like that, I would comment that I wrote that person and sent them the refund, and the person sent the cheque back to me saying they were not owed any money, and I have it in writing.
Mr Bisson: Can you repeat that?
Mr Dyment: I wrote back and apologized for the inconvenience. I did not quite understand what the inconvenience was. I sent a cheque along with it, and the person wrote back to me saying he appreciated my concern but he was not owed any money, and returned my cheque.
Mr McLean: You must be talking about a different letter than the one I am talking about.
Mr Dyment: I am talking about the identical letter.
Mr McLean: Supplementary? I have another letter from a constituent with regard to the service being provided since Ontario Northland took over, and it has to do with a couple who left Pearson Airport and were five minutes late getting to Yorkdale. They got there at 7:45 pm and the bus had left five minutes earlier, and there was not another bus for five hours; they had to wait for five hours for the next bus to get to Orillia. What comments would you have on that type of service?
Mr Dyment: I would like to have the letter and be able to look into the situation and reply to whoever wrote it. I am unaware of it.
Mr McLean: Okay. Telecommunications is the one area in which you make money, and what you make on telecommunications pays for all the losses you have, mostly in the other operations. What changes are you going to make with regard to the connections with Bell Canada and these boundary points you have? Any?
Mr Dyment: We are not going to make any.
Mr McLean: Do you feel that profit margin will increase?
Mr Dyment: That profit margin will probably remain steady or decrease slightly.
Mr McLean: The rail freight, $4.4 million net operating loss last year. What are you doing to change the picture on that, if anything?
Mr Dyment: We had a massive reduction of staff, and the results of that will only be seen in more recent months because of the payments we had to make. We do not want to reduce any other staff. We are actively trying to market the railway. We have been successful in marketing some of our skills. We realize that in the north there is not much more product to ship out. We have been shipping our raw resources for 90 years this year. We are a shipper of product, we are not a receiver of product. We only bring in what we can eat, and where.
We are trying to get into some businesses in which we are not, such as the lumber business. We are trying to become more competitive by picking up a CNR line that goes out to Calstock, Hearst and Mattice, where there are lumber markets and where the CNR is doing a pretty poor job.
We recognize that we have modern shops and have other skills to market. As a matter of fact, we were successful in obtaining a contract this past year to refurbish 22 Via coaches, so we are marketing our labour skills. It is those sorts of efforts that we are making. We do not want to reduce our staff. We feel a responsibility to keep jobs in the north. We also have a safety point, past which we do not want to go, in terms of the quality of our roadbed, so we are marketing the skills we have in the north and trying to do work in the north.
Mr McLean: Did you say you were going to purchase 24 Via coaches?
Mr Dyment: No, we have a contract to refurbish 22 of them.
Mr McLean: Twenty-two for Via?
Mr Dyment: Yes, for Via.
Mr McLean: Are you going to make a profit on that?
Mr Dyment: You bet.
Mr Sinclair: It will also save about 23 jobs.
Mr McLean: The other question I have is with regard to the rail services. Yesterday in the standing committee on social development there were presentations made by CN and CP with regard to hauling waste to the Adams mine, and I watched with interest the presentations they made. Have you people made any inquiries of the Ministry of Northern Development and Mines if it would want to participate in that type of freight?
Mr Dyment: It is our understanding that the government is our sole shareholder, and it is our understanding that the province does not want to get into the waste-shipment business.
Mr McLean: It is your understanding that they do not want to, but have you been making any waves, so to speak, to say: "Look, if it's going to happen, we want to be part of it. If there is money to be made for Ontario Northland, we want to be part of it"?
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Mr Dyment: If the waste is shipped north to the Adams mine, as you are suggesting, then there is only one railway from North Bay to the Adams mine.
Mr McLean: And that is the ONTC.
Mr Dyment: That is right.
Mr McLean: Then with the presentation they were making yesterday -- are they going to have to run on your lines or buy service from you in order to do it? Do they do it now?
Mr Dyment: No, they bring their product to North Bay and then we haul it to its destination, or vice versa: We haul it from the originating point to North Bay and turn it over to CN or CP.
Mr McLean: You could haul it directly from Toronto on the line you have, could you not?
Mr Dyment: We do not have a line from Toronto.
Mr McLean: Does the Northlander not run to Toronto?
Mr Dyment: It runs on CNR tracks, at a rental rate.
Mr McLean: That is the question I want to get at. You pay them a rate to use their tracks.
Mr Dyment: Yes.
Mr McLean: Is your passenger service the one that used to hit Orillia at about 1 o'clock in the morning?
Mr Dyment: No, that was a Via Rail train.
Mr McLean: Yours goes down the other side of the lake, I presume.
Mr Dyment: It does now.
Mr Hayes: I would like further clarification on the mandate of the commission. There is talk about operating outside northern Ontario into centres in southern Ontario. The question raised to us by several people is, is your mandate only supposed to provide service within northern Ontario and, if so, why are we going outside that area?
Mr Dyment: Operating transportation or telecommunication services within any defined geographic part of the country necessitates your making a connection to the balance of the country. You cannot operate in isolation. People want to travel, for instance, from Timmins to Toronto and from Timmins to North Bay. We have to get those people to Toronto, because that is where they want to go, so we have to make this incursion into the southern part of the province to make that connection. The phone calls we make are to Greece, California, New York, Edmonton and Kirkland Lake. We have to provide that ability to connect with the world. To make that connection with the world, somewhere we have to meet the balance of the world. That somewhere we are using right now is Toronto. We are not going beyond Toronto.
The people in the north -- in the bus business to which you referred -- also want to go to Florida and to the Yukon. They want to travel in the wintertime. The only bus company in Cochrane, for instance, is us. We give them that opportunity. We also have to make that bus company profitable. Bus companies do that by providing charters and tours. If the people in North Bay want to see the Blue Jays, we will take them to see the Blue Jays and subsidize our regular passenger runs. We are not going to start offering charters from London, Chatham or Belleville, because that does not come within this geographic territory we are providing service for.
Mr Hayes: So all or most of your charters would come out of the north; they would originate from there.
Mr Dyment: We picked up the Gray Coach Lines licence which gave us the North Bay-Toronto geography, but we have agreed not to run charters out of Toronto except back into the north.
Mr Hayes: Have you done any restructuring due to the recession? Have there been any jobs affected or lost as a result of the recession? What are your plans?
Mr Dyment: If I compare us to the 1988 level, we are down about 200 jobs. That is on a base of 1,500.
Mr Hayes: The next question is on the air service. Why did Northland not proceed with its plans to provide the Dash-8 service between Ottawa and Winnipeg and through to the major centres of northern Ontario?
Mr Dyment: Two carriers objected to us flying that route from Winnipeg to Ottawa. The two carriers said that between them they were going to lay off some 75 to 90 people, depending on which figures you use, as a result of this particular competition. We were going to run this service with something like 30 people, which says something for government agencies, when we can do what the other sector requires twice as many people for. None the less, with that massive layoff, the government in its wisdom said if these other carriers would provide the service we had anticipated providing and would do it without laying off 75 people, the employment impact on the north would be beneficial, so we backed off.
Mr Marchese: Could I ask a question on this?
The Chair: I will allow a quick supplementary.
Mr Marchese: How do you explain the other provider of this service saying, "We're going to lose 75 jobs if the competition goes through in this way," and your saying, "We would provide 30 jobs in providing the service"? In your assessment would there have been 75 jobs lost, or is that something a private sector puts out as an argument, as a threat really, saying, "We're going to lose 75 jobs"? Then of course we simply back away, because in the number scheme there are more losses than gains. Did you assess whether there really would be 75 jobs lost? Is that your job or the ministry's job?
Mr Dyment: We provided advice to the minister. It is my assessment that the 75 jobs comprised some which would have been lost, were legitimate; for those legitimate jobs, we were prepared to hire the people. I think it provided some that were a threat and in the 75 were some jobs that would have been laid off anyway.
Mr Hayes: The people who were laid off -- I am not dealing with that one; I am just talking about Northland itself -- did you make any settlements with those employees, or have you provided or do you plan on providing any retraining to the people who have lost their jobs?
Mr Dyment: Definitely. We initially provided a fairly attractive early retirement package. About 110 took advantage of that. Since then, we also have in place with our unions an employment security plan which provides for a laid-off employee to receive a portion of his or her salary for a period of time depending on the number of years of service. As a rule of thumb generally in the railway, for instance, if you have seven years of service and you are laid off, you will receive 70% to 80% of your wages while you are laid off. You must come back to Ontario Northland when we have a job for you in any location or in any field.
We provide the retraining. We try to avoid the implementation of the employment security plan, though. We negotiate with the unions individually to try to relocate people and retrain people. For instance, someone mentioned earlier us laying off people on the train as a result of implementing a snack car. We took some employees and put them in other departments. We transferred four to our clerical ranks, for instance. There were four on-board service staff who seemed to have some clerical abilities so we put them into the clerical group. We have taken one lady and are teaching her to be an instructor, so she is going to go out and instruct people on how to deal with the public, become a customer service representative. These sorts of things we try to do. We have been fairly successful in that people in Ontario Northland have not ended up to any great extent being laid off.
Mr Hayes: How important is the Ontario Northland Transportation Commission, even talking about the Polar Bear Express, for example, to the economic development in Moosonee?
Mr Dyment: My view is that it is extremely important. We try to take 20,000 people a year to Moosonee and Moose Factory. It really is, other than transportation, the only source of income for the residents of the area. It provides them with a group of people who want their services. They want to travel in canoes. They want to see their villages. They want to talk to these people. If we did not bring them up there, the motels in Cochrane would fold; the people in Moose Factory probably would not have an outlet for their water taxis at all; they would lose their market for crafts. I think it is extremely important. Whenever we try to monkey with the schedule, we get such a reaction from the communities up there that we know it is important to them.
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Mr Hayes: I am familiar with the Polar Bear Express because I have actually ridden on it. What is the Little Bear Express service? How does that come into the picture?
Mr Dyment: The Polar Bear excursion runs two months of the year, six days a week. The Polar Bear runs from Cochrane to Moosonee in the morning and back in the evening; it runs up and back the same day. It is called the Polar Bear because I think somebody 30 years ago actually saw a polar bear. That is the only one that has been sighted.
The Little Bear, on the other hand, runs year-round; it runs 12 months of the year. It runs up Monday, Wednesday and Friday, and back Tuesday, Thursday and Saturday to Moosonee. It is a mixed freight-passenger train, which provides the freight and passenger link to Cochrane, not only for Moosonee but for all the communities in between. It has 186 miles of track. The Little Bear is famous for stopping whenever you wave your hand. We service the residents between Cochrane and Moosonee, as well as between Moosonee and Moose Factory.
Mr Marchese: So there are little bears.
Mr Dyment: There are lots of little bears.
Mr Brown: I want to return to Star Transfer for a little bit of information. Does Star Transfer operate south of North Bay? Does it run from Toronto to the north, or does it interline with somebody?
Mr Dyment: We actually have two ways of getting south to North Bay. One is we have an interliner arrangement with Kingsway Transports Ltd. The second is we have a contract with Cathcart Transports. Cathcart is a transport company operating in the south. They actually provide brokerage business for us. They pick up and deliver business for us in Toronto, assist us in marketing our product and help us run broker operations from North Bay to Toronto. Essentially, Star Transfer does not run south. We use the arrangement with Cathcart or Kingsway to make that link for us. We sold our assets in Toronto eight or nine years ago.
Mr Brown: Is Star Transfer involved primarily in less-than-truckload freight or truckload freight?
Mr Dyment: It is mostly LTL. We do have some truckload. We are trying to get into more truckload, but primarily it is LTL. Northbound, it is LTL almost totally. We take truckload -- we will take paper, for instance, from Iroquois Falls south, to run the truck.
Mr Brown: Back in the days when we were discussing deregulation of transportation, the government's argument at the time, which I was not totally convinced of, was that there was no need in northern Ontario to provide trucking services on the basis that Star does. The argument went that free enterprise, if allowed to flourish in the area, would find new and innovative ways of servicing northern Ontario, etc. At the time, I found it very difficult to rationalize that public policy view with the maintenance of Star Transfer. We had a government initiative that essentially said entrepreneurism should flourish and that even the smallest communities would be able to maintain their services perhaps locally instead of with a larger corporation. Yet we see that following that deregulatory initiative Star continues to lose money and actually is increasing its losses. Some might argue that what Star is essentially doing is subsidizing Cathcart and Kingsway, if you are a carrier in competition to them in that north-south route. Do you have any comments on those ramblings?
Mr Dyment: Subsequent to the period of deregulation that you talked about, or the start of deregulation, companies going into the north folded in pretty quick order. Dominion Consolidated --
Mr Brown: To be fair, that has happened everywhere in the province, though.
Mr Dyment: I know. But in the north when you have people like Dominion Consolidated and Brazeau Transport folding and you only have perhaps three or four carriers to begin with, it makes a tremendous impact. You do not have many transport companies you can call to haul your product. When two out of the five fold, you are not left with many in the north. The decision to operate as a partner with Kingsway to me was a sound one in that Ontario Northland and Star Transfer could not provide the vacuum cleaner you need in the Toronto area to pick up parcels for Timmins and Kirkland Lake.
You have to do an awful lot of picking up and delivering in Toronto to single out communities like Kirkland Lake, Kapuskasing, Hearst and New Liskeard, and Star just could not do it given the small territory it served. We needed to make a connection with somebody like a Kingsway who already had a pickup and delivery service. We also had a terminal which was worth something like $1.4 million and you just could not justify that.
Mr Brown: I am still puzzled, however. I do not have a problem with this if our losses are not increasing; if we were competing with this trucking company on an equal footing without subsidization I could understand this. But I am having some difficulty understanding the problem. In some respects Star will be keeping the independent trucker, the fellow who may have a small operation, from getting into this business, because it is there and keeping some entrepreneurship out of the local economy.
I know in my area, while it is true there have been fewer and fewer large companies, there are getting to be more and more small firms doing things that make sense to them. That encourages small business because hopefully competition is greater, rates get better and what not as people find ways of providing services at more efficient rates.
Mr Dyment: My main response to that would be that we are attempting to bring Star closer to the break-even level. We have put into effect some measures which will improve its net by $1 million annually. Those measures are in effect now.
Mr Brown: You have a plan, then, to bring Star at least to break-even?
Mr Dyment: Yes. That plan is now in effect.
Mr Brown: What is your time frame for that?
Mr Dyment: Twelve months. Within a year we plan to improve its net position by $1 million.
Mr Brown: That sounds encouraging and I am sure the committee will be watching that closely. Mr Chair?
The Chair: Would you like to go out and greet your new leader who just arrived?
Mr Brown: That would not be a bad idea. Some of us have to work, though, Mr Runciman. I would yield the floor if other members have questions, but I do have more.
The Chair: We will come back to you if you want to slip out for a little while now.
Mr McLean: I would be interested in knowing what your legal fees cost you in a year for your organization. Any idea?
Mr Dyment: We have two lawyers on staff and from time to time we hire outside people depending on the nature of the business. Our average outside legal bill in a year would be about $200,000. That is the average.
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Mr McLean: You are preparing an action plan for Moose Factory. What is that action?
Mr Dyment: Moose Factory is the reason people go to Moosonee. You do not want to see Moosonee. There is nothing to see in Moosonee. Moosonee is a young community; it was really established when the railway hit there in 1932. But Moose Factory, and not many in Ontario know this, is the oldest settled community in Ontario. It beats Kingston. I usually get a reaction when I say that, but it is the oldest settled community in Ontario.
There is a lot to see and it is deteriorating badly. Our action plan would see the restoration of what history there is: a church, a graveyard, an old Hudson Bay structure. It would see the rebuilding of a fort and the building of a native community, all with a view to letting the natives operate it. That is what the action plan is.
Mr McLean: I would like to go back to the meeting yesterday in social development with regard to the two railways' presentations to the committee about moving solid waste to the north. Have you had discussions with the government or with the principals in the ministry with regard to solid waste transportation?
Mr Dyment: Not recently.
Mr McLean: You have had discussion with them?
Mr Dyment: Earlier, yes.
Mr McLean: In your annual report you indicate: "Ontario Northland submitted an expression of interest for the movement of recycling and landfill of solid waste from the GTA and Metro. The movement of solid waste by rail from Toronto to northern Ontario is seen as an opportunity for Ontario Northland and northern Ontario." When was the last discussion that you had with regard to that?
Mr Dyment: If you will allow me to guess, about June or July of last year.
Mr McLean: Are you pursuing it any further?
Mr Dyment: No we are not.
Mr McLean: The expansion you are having in Kirkland Lake includes a new bus terminal. What would the cost of that bus terminal be?
Mr Dyment: It is difficult to say because it is part of an office structure and the bus terminal occupies about one half of a bottom floor. The entire structure is about a $4-million structure. The bus terminal is kind of, "While we're building an office, let's put a new bus terminal in."
Mr McLean: Will that come under your non-commercial or your commercial?
Mr Dyment: That will definitely come under commercial.
Mr McLean: What about the bus terminal being built in Barrie? What is the cost of that going to be?
Mr Dyment: I have no idea.
Mr McLean: Does anybody?
Mr Dyment: I would say the city does. They are building it.
Mr McLean: The city is building it and you are going to lease it from the city?
Mr Dyment: Yes. We will lease part of it from the city.
Mr McLean: I see. Where will your tour operation be going in?
Mr Dyment: In that same building.
Mr McLean: You indicated that your tour operations out of Toronto would be to the north only.
Mr Dyment: To the north only.
Mr McLean: And the ones out of Barrie?
Mr Dyment: Anywhere. Regular charter or tour.
Mr McLean: Why would the ones out of Toronto only be to the north when you have Barrie, which can go to the south or anywhere?
Mr Dyment: The principle was that by going into Toronto we would be increasing the number of charter and tour operators in the province because we bought an operation from Gray Coach. Gray Coach was not willing to give up the charter and tour business out of Toronto so we would become an additional operator. That is not true in Barrie. We replaced Gray Coach, so the number of tour operators in Barrie remained the same as it was before.
Mr McLean: You are saying that Gray Coach operated tours out of Barrie?
Mr Dyment: They had full licensing out of Barrie.
Mr McLean: But did they operate tours out of Barrie?
Mr Dyment: I have no idea.
Mr McLean: But Ontario Northland is going to operate tours out of Barrie.
Mr Dyment: Yes.
Mr McLean: The interchanging of tickets: You said you are pleased that you have not paid what you have been billed for. Did you cash the cheques that PMCL paid you for using their interchange?
Mr Dyment: I am afraid I do not know what you are talking about. They are in our terminal and they have to pay rent and we would cash those rent cheques.
Mr McLean: I am not talking about rent cheques. I am talking about interchanging of tickets they sent you the money for. Did you cash the cheque?
Mr Dyment: I would be unfamiliar with what those tickets would be for and I would have no idea what the cheque would cover.
Mr Marchese: He always says that.
Mr McLean: That is right.
The other area I wanted to talk about here has to do with the meetings you have with the Ministry of Northern Development and Mines; the chairman of the commission meeting with the deputy minister or ministers. Has that taken place, and when was the last meeting you had with the minister?
Mr Sinclair: We had a meeting in December. The meeting before that was in the fall. We had one in July. We had one at the end of May.
Mr McLean: Was the one in December after you got the directive from the minister to continue allowing PMCL to use the terminal until such time as an agreement was made? Was that meeting late December or early December?
Mr Dyment: I am not sure. The meeting was in December, and I would suggest to you that the dealings with PMCL were not on the agenda. December 16 was the date.
Mr McLean: December 16 was the date of the meeting.
Mr Sinclair: The minister was not at that meeting, Mr McLean.
Mr McLean: Okay. Is the Cree native band in Moosonee doing some consulting work for you with regard to you looking at hotel facilities in Moosonee? Is there a strategy planned there for the private sector to be involved, private sector funding for the hotel?
Mr Dyment: First, there is no Cree native band in Moosonee.
Mr Bisson: There is no what?
Mr Dyment: There is no Cree native band in Moosonee.
Mr Bisson: There are no Cree in Moosonee?
Mr Dyment: There is no Cree native band. There are two bands in Moose Factory but there are none in Moosonee. Moosonee is a creation of the legislation of Ontario. It is a Moosonee development area board. It is not a native or a band community.
Mr McLean: Your annual report indicates Moosonee. "Ontario Northland, in cooperation with the Cree native band, has engaged a consultant to prepare a plan for development of hotel facilities in Moosonee and Waskaganish. Part of the plan is to outline a strategy for attracting private sector funding for this development."
Mr Dyment: That Cree native band is a band located in Waskaganish. Waskaganish is a community on the east coast of James Bay, formerly called Rupert House. That band wants to do a joint venture with Ontario Northland to build a hotel in Moosonee. A hotel is badly needed in Moosonee. The current operators are not doing a good job and the Moosonee development area board, which is the local council, has petitioned us to build this hotel because they know we are doing development in other communities. The band wants a joint venture to the extent of 50% with us, but that is the band in Waskaganish.
Mr McLean: In the opportunities you are looking at, you say, "Ontario Northland is actively pursuing industrial and tourism developments which can create new revenue opportunities for ONTC's operating divisions. For example, Ontario Northland Development's solid waste disposal opportunity forecasted for 1993 is expected to generate significant revenues and profits for rail services." I am referring to page 75 of the annual report. You indicated that you were not pursuing that solid waste aspect of it.
Mr Dyment: Right.
Mr McLean: Yet in your report you said, for new revenues, that is where you are going to get a lot of it.
Mr Dyment: Right.
Mr McLean: What are you saying now?
Mr Dyment: I am saying we are not.
Mr McLean: When was this report done?
Mr Dyment: March 1991.
Mr McLean: Okay. A lot of changes have taken place since then.
What are you doing in the north with regard to expansion of tourism, other facilities you may be looking to establish? You have your bus routes, you have your ferries, your boats, your tourism aspect. What else are you doing with regard to expansion of tourism?
Mr Dyment: We have become very active. We are becoming the catalyst in the north for pulling together all the tourism ventures and tourism associations to try and market the north, or northeastern Ontario, as a geographic bloc. We feel that in the past efforts have been made to promote elements of Manitoulin Island, elements of Moosonee, elements of gold mining communities, but nobody has promoted northeastern Ontario, and that is what we are doing. There are probably some members here who will attest to the fact that we are doing a pretty fair job of it. Over the last two years, while tourism in Ontario has declined, in Manitoulin Island, for instance, it remained static. In Moosonee it was only down 3%, on Lake Nipissing it was only down 13%, on Manitoulin Island it was zero, whereas other parts of Ontario are seeing 20% or 25% declines.
We are putting together a video production which will promote and advertise the entire north; we have put out brochures; we have put out Sunday supplements in the Toronto Star, something like 800,000 copies of a "Be My Guest in Northern Ontario" campaign. So I think we have done a lot.
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Mr McLean: Would your bus service run a charter bus from Toronto to Tobermory for Chi-Cheemaun?
Mr Dyment: No, it would not.
Mr McLean: That is not classified as north.
Mr Dyment: Not by Ontario Highway Transport Board definition it is not. It has to be north of Highway 17.
Mr McLean: They do have a definition of what northern Ontario is?
Mr Dyment: Yes.
Mr McLean: Was that not in the mandate of the Ontario Northland Transportation Commission, to service the north?
Mr Dyment: We have to abide by our authority and our licence.
Mr McLean: I am trying to find in here -- I read somewhere about the initiatives you were trying to take with regard to some overseas markets. Am I wrong?
Mr Dyment: You are wrong. We are trying to market northern Ontario in Germany and in the Orient.
Mr McLean: "The World Bank, the African Development Bank and by actively seeking opportunities through Ontario organizations such as the Ontario Ministry of Industry, Trade and Technology and Ontario International Corp." Are you dealing with them for overseas markets?
Mr Dyment: No, we are trying to sell our expertise. Ontario Northland is a railway and a telephone company, a truck line, a bus line and a boat line and we are much smaller than CN and CP. Canadian consultants are going over to Africa, for instance, to try to sell consulting services to countries that are about the size of Ontario Northland rather than the size of Canada. So there is a niche, a very good niche, for Ontario Northland to sell our human resource skills. We have an awful lot of them. That is what that is.
Mr McLean: A final question: What are you building in Timmins? Is that a new terminal, or what are you doing in Timmins?
Mr Dyment: In Timmins we have freed the downtown railway lands. They are now undergoing environmental correction and we are open for development.
Mr McLean: Are you selling off the railway lands to industry or for shopping malls or for subsidized housing? What are you selling them off for?
Mr Dyment: We have not sold any yet. About half of them have been optioned by the city for its purposes and the other half is open for good suggestions.
Mr McLean: Your interest income ranges from about $3.3 million in 1990 to a borrowing position of $1 million in 1992, and you are "expecting your interest income to improve due to an inflow of cash from a solid waste development opportunity." That will not happen now, will it?
Mr Dyment: That will not happen, no.
Mr McLean: What do you expect your interest income will be, then, for 1992?
Mr Dyment: It will probably be a cost.
Mr McLean: And an interpretation of "cost" would be?
Mr Dyment: Debt, expense, money you owe.
Mr McLean: You cannot already add to that. I am a farmer. I will pass for now.
Mr Frankford: The telecommunications is really a very significant part of your revenue?
Mr Dyment: Yes, it is.
Mr Frankford: On page 71 we have your operating plan and the operating profits and the projections. I guess it is really dependent on a steady increase in operating revenues. Is that something that is taking place or are you having to correct that?
Mr Dyment: That is something that is traditional. If I go back 30 to 35 years, I will find that there has been an increase in every year. The operating revenues have never decreased. That is the rate we are predicting and it is simply because of the long-distance business. The long-distance business has been ever-increasing and despite lowering of rates the elasticity of the market is such that you keep getting more business.
Mr Frankford: Okay. Could you talk about other approaches that are being taken to increase services and revenue for telecommunications?
Mr Dyment: We have done an awful lot. We try to keep pace with the industry. We were the first telephone company in Ontario -- I know Bell does not like this to be said -- that would allow our customers to dial zero and then the digits and be able to make collect calls or pay phone calls that way. We are the first company in Ontario that was fully made what they call zero-plus. We have been keeping contemporary in terms of our regular long-distance services and we sell a whole gamut of TV services, computer-connected links and all these other things in our telecommunications business.
Mr Frankford: What TV services?
Mr Dyment: If you want to buy a TV channel up to Timmins to broadcast a rally we will sell you a TV channel.
Mr Frankford: As a link.
Mr Dyment: Yes, for a TV program.
Mr Frankford: Presumably this is a capital-intensive industry where there are all sorts of innovations going on. Is that predictable here or are you going to be faced with significantly increased capital costs?
Mr Dyment: No, the capital predictions are already included in those amounts.
Mr Frankford: Do you have cellular service there?
MR Dyment: No, we do not. We are predicting to start north of North Bay in two years; we are going to work it north. The market is so sparse up there that you can travel from North Bay to New Liskeard, and in New Liskeard you will find 12,000 people, but between North Bay and New Liskeard, and that is about 100 miles, you will find two small communities and that is it. That is very expensive to service.
Mr Frankford: That will require capital investment.
Mr Dyment: Yes, it will, which has been predicted.
Mr Frankford: Are you going to have cellular service on your trains?
Mr Dyment: As a matter of fact, we are.
Mr Bisson: Can you go through the mandate of the ONTC? What basically is the mandate of the ONTC?
Mr Dyment: We are an agency of the crown, wholly owned by the crown, and we are to service the north for transportation and telecommunications needs and to link the north with the rest of the world.
Mr Bisson: Let me keep on going, then. Basically the service the ONTC provides is service to northerners, some of which we would not get if strictly dependent on the private sector, due to the sparse population, the large geography, etc. Basically what I am getting at is that the whole situation with the ONTC is that on some of your business you make some money; on some of it you lose. Can you just elaborate on that a little bit?
Mr Dyment: The farther north you go, the less lucrative becomes your operation as a business. At some point it will flip and become a loss. We have to depend on our large population centres. To us a large population centre is Timmins, with 50,000 people; to us that is huge. That is the kind of population we are talking about. We have to depend on the Timminses to support the Latchfords, but our revenue has to exceed our expense so that we can regenerate our plant, so that we can capitalize and so that we can upgrade and develop.
Mr Bisson: One of the situations the ONTC finds itself in from time to time is the whole question of competing with the private sector. Playing the devil's advocate on that, what do you have to say to somebody who says you as a crown corporation should not be in direct competition with somebody in the private sector?
Mr Dyment: If the private sector was going to provide the gamut of service that Ontario Northland provides, then there could be an argument. But if somebody says for instance that we should not be running buses from Barrie to Toronto, when that bus route is making sure that we can run a bus from Cochrane to Hearst, then I would say run the bus from Cochrane to Hearst too. That is the whole nature of Ontario Northland. We are running two buses a day from Cochrane to Hearst and we are doing it because we have some larger cross-sections which help pay for it.
Mr Bisson: Basically then, on those runs where the ridership is not high enough, where you lose money, obviously you are trying to offset the money in other centres such as Timmins or wherever you can get more ridership to subsidize it. Speaking of Timmins, a place that interests me quite a bit, actually -- I live there -- there are a couple of issues I would like to get into. One of the issues is something that happened I guess about four or five years ago, maybe not even all that long ago, the whole question of what happened to the rail service in Timmins. Maybe you can walk us through that. As you know, passenger service in Timmins is no longer existent. Being that Timmins is the largest community in northeastern Ontario that you service, can you explain the rationale why the passenger rail service was taken out of Timmins?
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Mr Dyment: Really we took the rail service out of Timmins, and passenger went with it. Our decision was premeditated by freight, not passenger. We used to have a freight line which ran from North Bay up to Porquis and then into Timmins and it terminated at Timmins. It did not go any farther than Timmins; it terminated in downtown Timmins. The amount of freight going into Timmins was something like three boxcars a month and the amount of freight coming out of Timmins was something like five boxcars a month. That does not justify running a railway. We also had a passenger train. South of Timmins but still within the city of Timmins were a mine and a smelter and a refinery.
Mr Bisson: There is a mine; do not say "was," okay?
Mr Dyment: A Freudian slip. There is a mine, and a good customer of Ontario Northland. They shipped a lot of product in and a lot of product out. It seemed to make sense to terminate the railway at that point because it was not being used beyond it. We were able to accomplish many things. First of all we cut out about 10 miles of track, or nine miles of track which was not being used. That nine miles of track -- and you will have to forgive me about 10% -- had something like 18 or 20 level crossings and we would get three or four people a year at those level crossings. We had a couple of scares, for instance a gasoline spill and a propane incident, because of spurs in that nine or 10 miles of track. We had a lot of land that was right in downtown Timmins that people wanted to use.
The decision was that you had a piece of track which did not have any traffic on it. You could terminate it where the traffic terminated and still be within the city of Timmins, and that is what we did. We pulled up the tracks and freed up the land. We are now cleaning it environmentally. Crossing accidents of course are gone. There are no more propane or gasoline spills associated with the railway. We do not think we are to blame in any event, but none the less they are gone and this land is available for development. That was the decision. In that decision, the passenger train could no longer go to Timmins.
Mr Bisson: I guess what I am saying, and I think it is what a lot of people in my community are saying, is that if Timmins is the major market for Ontario Northland when it comes to passenger rail service or bus service or whatever service you are offering, to not have that train come to a community like Timmins, I really have to wonder. I realize people can get on a bus in Timmins and they can go to Porquis Junction and take the train from Porquis Junction down to Toronto. But today what has happened through deregulation in our airline industry is that we have lost jet service in northern Ontario. There is not a community in the north that is now served by jets. The flying time to get into Toronto obviously is a little bit longer. The congestion at Lester B. Pearson International Airport is also adding to that time. I know last winter, for example, I could actually drive to Timmins more quickly than it took me to get from my downtown office in Toronto to my downtown office in Timmins when you look at all the congestion you had at Pearson and trying to get out and being de-iced and the rest of it.
All I am saying is, was there ever an attempt on the part of Ontario Northland to really look at finding a way, if at all possible, to market either a night train or some kind of rail service from places such as Timmins and picking up people along the way into Toronto in order to serve that need? One of the problems we have now is that a lot of our seniors and people who do not want to get on planes for various reasons have no other way to get down to Toronto than by bus. It is not a lot of fun to sit on a bus for eight or nine hours to get into Toronto; actually, it is about 10 hours.
Mr Dyment: We run a bus from Timmins to connect to the train.
Mr Bisson: In Porquis Junction.
Mr Dyment: Yes.
Mr Bisson: I get lots of letters about that.
Mr Dyment: People in Timmins can get on the train in 30 or 35 minutes.
Mr Bisson: Would it not be feasible to have that train come as far as where the Texas Gulf loading area is?
Mr Dyment: If we did that then we could not run to Cochrane.
Mr Bisson: Why could you not run to Cochrane?
Mr Dyment: The train tracks go in different directions.
Mr Bisson: No, well, it connects in Porquis Junction.
Mr Dyment: Yes.
Mr Bisson: The train originates in Cochrane. It used to originate in Timmins; you used to pick up passengers there. Is there not a system that you built in order to pick up passengers in Timmins?
Mr Dyment: On the train?
Mr Bisson: On the existing lines, yes, because they are connected.
Mr Dyment: There only is one train. It goes north to Porquis and it either has to go left or right.
Mr Bisson: But at one time you used to back up and come into Timmins.
Mr Dyment: But it did not go to Cochrane.
Mr Bisson: The point I am trying to make is that within my own community there are a lot of people who would like to be able to take the train -- that is the bottom line -- because of the inconvenience of the bus and the rest of it.
Mr Dyment: You are right. We could go to Timmins, but I think the major point is that we could not then go to Cochrane. When we did go to Timmins the Cochrane people came down by bus. We can do it either way.
Mr Bisson: There are 50,000 people in Timmins and about 7,000 in Cochrane. Anyway, I will deal with that one later.
The other thing is on the question of the development of the the ONTC lands in the downtown core. Where are things at this point? I know there is some discussion about some private sector development on that. There was an issue of somebody trying to develop a hotel. Where are those things at this point?
Mr Dyment: Half the land has been optioned now to the city. It has until 1993 to exercise that option. That is the western piece of the property. The other property we are just holding in abeyance, waiting for some commercial development to come up. We are going to environmentally clean the land and hold it there, waiting for the right time and opportunity.
Mr Bisson: So you are not actively out there looking for a buyer. I mean, it is there for sale and if somebody comes along, fine. Is that what you are telling me?
Mr Dyment: If somebody came along and provided an opportunity that would be good for Timmins and good for us, yes, but I do not think we would sell it for a parking lot.
Mr Bisson: No, I do not think that. But you are not at this point actively engaged in any discussions with any private sector people in regard to developing?
Mr Dyment: We are not, no.
Mr Bisson: The other question is on tourism. I recognize that one of the major roles Ontario Northland plays is, quite frankly, what you were saying about tourism, that the Ontario Northland has been a good for developing tourism markets in northern Ontario. You have touched on a number of them, from the Polar Bear Express to the goose camps to the excursion trips set up by Ontario Northland. You alluded a little while ago to the whole effort on the part of Ontario Northland to get people in southern Ontario, and also in the European market, to understand northern Ontario a little more and try to get people to travel up there.
At that point you market, but what is Ontario Northland actually looking at doing when it does get people up there? Are you planning on expanding services? Are you looking at tour trains? There was some discussion about that at one time.
Mr Dyment: We are looking at trying to tie together the existing attractions, structures and networks rather than creating new ones. We are trying to pull the private sector -- we are having success; the private sector is dealing quite nicely with us. We are trying to pull everybody together, because we think there is enough in the north, if it is properly packaged. Now, there has to be some packaging done, but I do not think we at Ontario Northland have to do much, other than in the Moosonee and Moose Factory area, where we have to do a lot.
For instance, in Timmins you have the mine tours. We think we can put the mine tours in the package, and the Timmins people who operate the mine tours can do quite a nice job without Ontario Northland interfering with them. The same is true of the pulp and paper tour of the park at Earlton. All we have to do is make sure the package is good, the packaging is good, the cosmetics are good, and let the operators operate it. There are some things, like the Polar Bear excursion, where we have to become totally involved. We think ours is a question of marketing the entire thing and only playing the operating role where there is a lack.
Mr Bisson: I know there was some discussion, and I do not know how far this went -- I cannot remember the fellow's name, but you have a fellow who is developing this actual strategy right now.
Mr Dyment: Yes.
Mr Bisson: It seems to me I was at a public meeting he was at and there was some discussion about developing and marketing in the long term, if at all possible, a tour train. The idea, I take it, would be to pick up people from all points in Toronto -- that would be the collector -- and then utilize the train to take people through various communities of northern Ontario to tie into the pulp and paper path, the Cobalt silver mine area, etc. Where is that at?
Mr Dyment: It is fairly dormant right now. There is only the one train into the north. There was some conjecture that perhaps we could tie the Algoma Central Railway to the CNR to the ONR. Whether that could ever be done is unknown at this point.
Mr Bisson: Why could it not be done? Both lines are fairly close to each other in Hearst, are they not? Oh no, there is the CN line up in Hearst, that is right.
Mr Dyment: They actually cross at Hearst, but we were attempting to buy the CNR line from Cochrane to Hearst. That has not yet been approved.
Mr Bisson: At one time the ACR -- I do not know if it still does -- used to run a skidoo tour, for lack of a better term. They were picking up tourists in Sault Ste Marie, loading their machines up on the flatbed and trucking people by train up into places like Hearst, in order to bring people to connect to the skidoo trails up in that area.
Mr Dyment: It was the ACR that was doing that. It is still doing it; it has been organized by the community of Hearst and it is very successful.
Mr Bisson: Has anything like that been looked at? Is it at all feasible with regard to the other part of the line?
Mr Dyment: It is very feasible. The difficulty we have is that we do not have a train that runs into Toronto. The system works where you can go to the market, which would be Toronto in our case, and let people load their skidoos on to a box car or a specially built car and then haul it up to the skidoo trails. But the CNR controls that line from North Bay to Toronto.
Mr Bisson: But you presently run the Northlander on that line. Could you not get into --
Mr Dyment: But no freight.
Mr Bisson: Pardon me?
Mr Dyment: We have no freight trains. We have no ability to get freight cars into a market in Toronto.
Mr Bisson: So you are saying you could not negotiate with the CN people the ability to haul an ONR train from Toronto all the way up, let's say, to Hearst or Kirkland Lake or wherever you are going with these particular things?
Mr Dyment: The rate is something like $14 a mile, which makes it prohibitive.
Mr Bisson: There is a heck of a potential for that, as far as what it would mean for the tourism outfitters and the people in the north is concerned.
Mr Dyment: I agree with you. I have talked to tourist operators and snowmobile associations up there and I am trying to encourage them to get the networks moving within the north. Hopefully the future will give us some way of getting the southern Ontario market up to them. If we can get it to North Bay, then they can plug into the network.
Mr Bisson: As for the Northlander itself, you are not paying 14 cents a mile on that, are you?
Mr Dyment: We are paying $14 a mile.
Mr Bisson: I will get to that on my next turn around. I think we are getting close to lunchtime and people are about to say it is about time. At this point I will break, provided I am still on the list coming back.
The Chair: That raises an interesting point, because some members felt we could finish questions in respect to the open part of this meeting and continue for the next 15 or 20 minutes, but I think it is clear that we are not going to be able to do that. We have Mr Brown, Mr Hayes, Mr Bisson again, Mr McLean and Mr Waters all on this list. On that basis, perhaps we are best to break for lunch now. We will come back at 2 o'clock and try to finish off the open session within half an hour and then get into the in camera session around 2:30, if we can all be back here at 2 o'clock sharp.
Mr Marchese: Mr Chair, we will not allow repeat questions, is that correct?
The Chair: We will try not to, yes. We will break for lunch and we will see you back here at 2 o'clock.
The committee recessed at 1203.
AFTERNOON SITTING
The committee resumed at 1408.
The Vice-Chair: The chairman is a little late, so we will start. I understand there are several questions people still want to ask.
Mr Grandmaître: Mr Dyment, can you tell me about your two operations, the commercial side and the non-commercial operation and how you balance your books, because maybe Mr. Laughren would need your help to balance the books.
Mr Dyment: We are essentially a commercial organization and we run a telephone company, a railway, a truck line, a bus line and a boat line.
Mr Grandmaître: How do you distinguish between the commercial and the non-commercial?
Mr Dyment: We do not, really.
Mr Grandmaître: You do not?
Mr Dyment: In a very great sense, as far as operations are concerned, we do not. We just run, for instance, a railway. We run trains and we keep track of our expenses and our revenues associated with running a railway. As part of running a railway, the government has asked us to run some passenger trains and we have said in previous years: "We can't run a passenger train and make money. We just can't do it." They have said, "Okay, we'll pay you to run the passenger trains then," and each year we negotiate the price to run passenger trains. But that negotiation to run a passenger train is not much different than a negotiation we would conduct with Dofasco to run an ore train or with Marsulex to run an acid train or with any of our customers to run freight. We just negotiate with the province a price to run a passenger train. We are running freight trains and passenger trains, all part of a railway, and we are collecting revenue. In one case it is revenue from the government for a service it has directed us to undertake.
Mr Grandmaître: Do you negotiate with government every year?
Mr Dyment: Every fall.
Mr Dyment: That is all outlined in the memorandum of understanding; the terms of reference and the guidelines for our negotiations are in there. We just try to determine what it would cost us to run that particular operation and then we negotiate the price from there, but I do not find that much different than negotiating any price. We undertake a risk as we would with any customer.
Mr Grandmaître: I thought there was a distinction between the commercial operators and the non-commercial operators. It is all part of one budget; is that what you are telling me?
Mr Dyment: Yes. As far as we are concerned it is one giant budget. This is outlined in our annual report where we have revenues from government-directed services. I can tell you what the government-directed services are: the rail-passenger, the norOntair network, the ferry business in Moosonee, and the Owen Sound Transportation Co. They are in our MOU and you will see them in our annual report.
Mr Grandmaître: It is one global budget except that your budget is divided into five different operations: one for railway, buses and so on and so forth. Is that how you do it?
Mr Dyment: Yes. I think it is six operations.
Mr Grandmaître: Six?
Mr Dyment: Five or six, yes.
Mr Grandmaître: At the end of the year when you are balancing or trying to balance your books, do you have five sets of books or one set?
Mr Dyment: I do not like to use the term "set of books." Our corporate accounting group keeps track of railway expenses and revenues separate from the norOntair expenses and revenues, which are separate from the marine business which is separate from the telephone company.
Mr Grandmaître: At the end of the year, though?
Mr Dyment: At the end of the year they are shown separately and shown in total.
Mr Grandmaître: I see.
Mr Dyment: For instance, if you went through our annual report, which we put in our package to you, and looked at pages 24 and 25 you will see the various operations separately, and if you turn to page 20 you will see them in total.
Mr McLean: I have a couple of questions. Cindy, you are the vice president of administration and development?
Ms Boston: Yes.
Mr McLean: Are you the secretary for the commission members when they meet?
Ms Boston: No.
Mr McLean: Are you in administration in the North Bay office?
Ms Boston: Yes.
Mr McLean: How many staff people would there be in the North Bay office?
Ms Boston: There are 200 people in our head office building: management, non-scheduled and unionized.
Mr McLean: Do you have buildings in Timmins or other offices?
Ms Boston: Yes.
Mr McLean: Whereabouts?
Ms Boston: Throughout the system.
Mr McLean: How many?
Mr Dyment: The question is how many buildings do we have?
Mr McLean: How many offices do you have where you have staff people?
Mr Dyment: Wow.
Mr McLean: Several?
Mr Dyment: Many. We have a freight office in Moosonee, for instance. There would be a clerk there.
Mr McLean: In Kenora, where the airplanes fly out?
Dr Dyment: We do not have any offices.
Mr McLean: You do not have any offices there. How many times does the commission meet?
Mr Dyment: 11 times a year.
Mr McLean: Are there any new members on that commission other than the one who was just appointed?
Mr Sinclair: Mr Marshall?
Mr McLean: Mr Marshall. Are you at your full complement?
Mr Sinclair: I do not think there is a statutory limit to the number. We have recently had three appointments plus Mr Marshall who is the most recent, so there would be four, say, within the last three months.
Mr McLean: Is there a certain number that are on the commission?
Mr Sinclair: Historically I think there have been 10 or 11 people on the commission. We are back to that strength.
Mr McLean: But under the terms of reference of the commission that were set up in the statute by the ministry, would it not say how many commission members there would be?
Mr Dyment: You must have one.
Mr Sinclair: Peter advises me that it says we must have one commissioner.
Mr McLean: There is no maximum?
Mr Sinclair: That is my understanding.
Mr McLean: Then how many members do you have now?
Mr Sinclair: There are 10, including myself.
Mr McLean: I have a letter here from the minister. There has been a copy sent to you. It is a public document. It is something anybody can have. He indicates in this letter, "I am writing to you concerning the proposed purchase of Gray Coach equipment and routes from Sudbury and North Bay to Toronto by the Ontario Northland Transportation Commission." This letter is addressed to Brian Crow, who is president of the Ontario Motor Coach Association.
In that letter he indicates: "You have expressed some concern" -- the minister has -- "to my staff about the competitive implications of certain services that might be undertaken by the commission as a result of this acquisition, specifically, charter buses originating from Toronto and the Toronto-to-Barrie service. As the minister responsible for the ONTC, I am supportive overall of the acquisition because of its positive implications for passenger bus service to northeastern Ontario."
It goes on and says: "However, I do understand that some may have concerns about the bus passenger service that does not directly relate to northern Ontario. While the legislation governing the operation of the commission does not limit its mandate to northern Ontario, certainly its primary function is to serve that region." This is from the minister.
"In this context, I am prepared to examine the policy implications of Toronto-based charter service and Toronto-to-Barrie service, to see how well they fit in the long term with the mandate of the commission. Specifically, I will examine the options of limiting Toronto-based charter services to northern Ontario destinations and selling the Barrie-Toronto route."
Have you had conversation with the minister with regard to that letter?
Mr Sinclair: What is the date of that letter, Mr McLean?
Mr McLean: That letter is January 31, 1991.
Mr Sinclair: There are some intervening events that took place after that. There have been two hearings before the Ontario Highway Transport Board since the date of that letter at which time the position of Ontario Northland and the licences applied for were quite different than when we started out.
Mr McLean: Bob-Kat Tours Inc has indicated very strongly with regard to the Ontario Northland charter tours out of Barrie that they realize Gray Coach did have the right to do that. However, to their knowledge, that hardly ever happened and now they have Ontario Northland coming in and saying it is now going to fulfil the mandate they believe they have to offer tours anywhere in North America.
As to the service that has been there in the past, mainly coming out of Barrie, Penetanguishene and Toronto, you are now fulfilling a mandate that has been fulfilled by private enterprise. The question I have is, do you believe the ONTC should be in competition with private enterprise in those types of tours going out of province?
Mr Dyment: We bought a service from Gray Coach which had a licence to operate charters and tours. We paid for it, signed an agreement and took the request to pick up their licences to the Ontario Highway Transport Board, and the Ontario Highway Transport Board has ruled.
Mr McLean: You are quite pleased to be able to do that. Would you be in any position to be interested, as far as the commission is concerned, in selling off some of those lines you have bought to the private corporation?
Mr Dyment: Our concern, as far as the Ontario Northland Transportation Commission is concerned, is to provide good service for the people of northern Ontario, to make sufficient excess revenue to refund our plant and keep us active in developing the north. If we can satisfy that mandate by selling something, I am sure we would look at it.
Mr McLean: With the $8-million increase you are going to have now with the acquisition of the Stage Coach lines, they figure the northern route will increase annual revenues from $5.4 million in 1990 to $13.4 million in 1995, so you are looking at a four-year overall increase in order to meet that commitment. Your expenses, however, are also going to rise some $7 million. In your opinion, do you feel the purchase will offset some of the loss you have in the transportation business as far as the coach end of it is concerned?
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Mr Dyment: Absolutely, and I think that is shown quite nicely in the report. The other important thing is that the increase in expense is for drivers primarily, and for mechanics to maintain and run our buses, the majority of whom will be located in North Bay and Timmins, which is important to us.
Mr McLean: A final question on this: The fact is that you have runs from Barrie to Owen Sound and Barrie to Midland that are running empty. Why would you continue to run them when they are not making any money? They are going to lose you money. Why would you continue to run them when you have the other direct routes that will make you money?
Mr Dyment: We do not have any runs from Barrie to Owen Sound and Barrie to Midland.
Mr McLean: You are not using that route at all?
Mr Dyment: No, we do not have a license for it.
Mr Waters: A few questions: Some time ago you said that you bought Gray Coach and its honour system, and you indicated that you have not changed anything from when Gray Coach had it. I believe that within a matter of days of purchasing Gray Coach, you sent out a letter to PMCL that said, "Please be advised that effective immediately Ontario Northland is terminating all interline ticketing agreements and arrangements with PMCL." You said you were going to keep their honour system and everything was going to stay the same, yet within a matter of days you sent a letter saying everything is changed. Can you comment on that?
Mr Dyment: Sure. Are we getting into an area that we said we would not get into before we went in camera?
The Chair: You probably have a better sense of it than I do.
Mr Dyment: I think we are.
Mr Waters: I will reserve that one for the in camera session then. Another part I am curious about is that you pay CN to run their lines --
Mr Dyment: We pay CN to run on their lines.
Mr Waters: Yes, to run on their lines. What happens if freight is going to the north or something? Does CN run on any of your lines?
Mr Dyment: We pay CN to run on our lines, and that applies to a passenger train only, because they have no --
Mr Waters: In any way do they run on your lines?
Mr Dyment: Only if they have a train wreck and they have to use our lines for a reroute.
Mr Waters: At that point that they would pay you?
Mr Dyment: That is right.
Mr Waters: How much is it that you pay?
Mr Dyment: Right now we are paying $21 a mile, but that, I have to say, includes some labour to operate trains. If we operated the trains ourselves we would incur some of that expense in any event. I think the figure without labour is $14 a mile.
Mr Bisson: Just for clarification, I thought you were saying this morning it was $14 a mile.
Mr Dyment: Yes. I just explained that.
Mr Bisson: You are saying $14 for a total of $21?
Mr Dyment: When I pay $21 a mile, I said some of that is labour which we would incur in any event if we ran the trains ourselves. If you exclude the labour, I think the figure is $14; exclude the labour we would pay if we had to run the trains.
Mr Bisson: You actually do not run any freight on the CN line. You haul it as far as North Bay and somebody takes it on from there. Is that basically the way it works?
Mr Dyment: The way railways in North America work is that you haul your freight cars, anybody's freight cars, on your lines. When you get to a point of interchange, you remove your locomotive, and caboose if you have one, and the other railway takes it from there.
Mr Waters: As I said before, I just came from a trip up north. As I mentioned to you at lunch so that you would have time to think about it, what do you do in public relations? On my trip up north, it seemed that every town I went into, whether it was tourism-related or not, people were complaining about ONTC, everything from your telecommunications on through.
Part of their concern was with what I was doing, the snowmobiling aspect of tourism. They were afraid that you were going to build hotels, that you would bring the tourists up, and that it would be strictly ONTC, right from the transportation to the hotel to the guide, everything. I would not mind some comment on what your plans are in that respect.
Mr Dyment: We do not have plans to build a lot of hotels. We built one at Cochrane because there was a need. We are building one in Moosenee because there is a need. If somebody else wants to build it in Moosenee, we would be happy to back off. We do not plan any other hotels. In Timmins, where our land is available, there was a joint venture proposed with a hotel on it, but that was based on need, based on the market and the private sector leading the entire project.
We do not plan to bring snowmobilers to the north and put them in our hotels, and we are not in the snowmobile business. There may be some adverse public reaction to our views on snowmobilers. I happen to be one myself, so I do not think they are so evil, but our railway does not like snowmobilers on railway tracks. We are actively campaigning to keep people from trespassing because we have had fatalities, we have hurt people and we think we have a responsibility to keep them off the tracks unless we can somehow control the access. I think I touched on all the points you raised.
Mr Waters: A couple of quick ones here: I seem to recall some conversation earlier on about how you are going to run tours to the north. Why would you be applying for a license -- I do not know whether you have received it or not -- that would specifically allow ONTC to carry passengers from within Ontario to destinations outside the province? It is my understanding that this would affect virtually all of central Ontario. You could pick up anywhere you wanted in Muskoka, Simcoe county, and run tours to Nashville or Florida or whatever.
Mr Dyment: We bought from Gray Coach the routes from Sudbury to Toronto and North Bay to Toronto along highways 69, 11 and 400. Is that what you are calling central Ontario?
Mr Waters: Yes.
Mr Dyment: If that is what you are calling central Ontario, we bought the routes from Gray Coach. We had to apply to the Ontario regulator to verify the passage of licence to us. The licence was transferred. We can run charters and tours from points along those highways. As I explained earlier, we and all other bus companies run charters and tours to supplement our ability to stay in the bus business and run regular passenger runs. I think the intervenors, those who objected to us picking up these licences, are in the charter and tour business as well and recognize that it supplements your ability to become a commercially viable commercial operator.
Mr Waters: I have two more. What is your affiliation with the Toronto bus terminal? Do you own that?
Mr Dyment: No. We are a bus company that rents space and rents our ability to park there like anybody else.
Mr Waters: I found it interesting, when one of my staff phoned the bus terminal in Toronto to get a ticket to go up to Orillia, that she had to make three phone calls. She finally asked specifically about PMCL's schedule in order to get it. The only thing they were willing to give her was the schedule of Ontario Northland. She phoned from my apartment here in Toronto. I know it to be true. It took three calls to get the earlier route out of Toronto. Every time, they kept saying, "Ontario Northland, Ontario Northland." Finally she said, "No, I want to know if there is another bus line such as PMCL that is running at an earlier time." It took three calls to do that.
Mr Dyment: We have no assets here in Toronto. We have no employees answering the phones or directing people.
Mr Waters: I am going to ask one last question. I got the sense when I talked to people up north who are your employees, and my staff went out and made some inquiries and they got the sense -- I will read what my staff wrote down -- "The general sense I got was that intimidation was used to keep people quiet. No one would talk to me if it was not confidential." Everyone is afraid of yourself, sir, the president of Ontario Northland, and they are afraid they have no protection. I would like your comments on this.
Mr Dyment: I would make no comment on that.
Mr Waters: You would make none?
Mr Dyment: No.
Mr Waters: It sounds to me like we have a major problem with employee relations here. That would be all my questions at this moment.
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Mr Brown: I am interested, as you might expect, in the Owen Sound Transportation Co. May I first point out to members who might not all be aware that Ontario Northland, through the Owen Sound Transportation Co, runs the two ferries to Manitoulin Island from Tobermory. We are pleased that we have put a second ferry on, I believe three years ago.
Mr Dyment: Yes.
Mr Brown: That service is certainly much appreciated by those constituents who live on Manitoulin and are on the North Shore. I think it has aided our tourism business significantly, besides helping our local people commute to southern Ontario.
I am interested in knowing when we might expect the Nindayama or the Chi-Cheemaun to be permanently docked in South Baymouth. I understand perfectly that it has to do with the amount of traffic we have, but what is your expectation in terms of the time line for when we will get to volumes that will permit the Nindayama to be moored at South Baymouth, giving us the opportunity of perhaps a couple of more sailings a day?
Mr Dyment: When we put the Nindayama into service, it was, as you will recall, during a period when tourism was on a pretty --
Mr Brown: Those were the days.
Mr Dyment: Yes. We put the Nindayama in there the first year because we were leaving people on the dock, primarily at Tobermory, and we predicted a 10% increase in traffic per year as a result of that. We thought that when the traffic increase was near 40% we would start sailing from South Baymouth early in the morning. We got the 10% the first year and we have resided there ever since. I guess our prediction is still the same: When we get that 40% figure, we will start sailing from South Baymouth in the morning. As you know, we did an environmental study to make sure we would not cause any difficulties. That has been completed, and it is positive.
Mr Brown: That is great. Of course, my constituents are looking forward to the day we reach that 40% because it will mean business is a little bit better on Manitoulin and also that for the first time they will be able to have those sailings first thing in the morning, so it is a convenience factor as well.
The second question I have is about norOntair. Again, we are quite happy with norOntair putting the flights in, as I said, not very long ago. While it is a vast improvement over having no service, we are somewhat interested in the mandate of norOntair and in understanding exactly what the feeling is of both the government and the commission on flying directly to southern Ontario.
I was pleased to note in the Dash-8 announcement that for the first time, at least to my knowledge, you were prepared to fly into southern Ontario -- or maybe eastern Ontario would be more precise -- and Ottawa. I was wondering if that is a change in the commission's and the government's thinking or whether we are still thinking about just having norOntair service the hubs of northern Ontario.
Mr Dyment: Really there is not a firm policy that we shall not fly into Toronto. We have done it. We did it during the Air Ontario strike, for instance, and for a while after that, when Air Ontario did not provide service from Kapuskasing and Elliot Lake, I think it was, we continued our Dash-8 service into Toronto.
The mandate of norOntair has not changed in that its role is to try to collect people from the 21 northern communities we serve and take them to some airport where they can then get a connection to the world. When we take people to the major collecting points now -- Thunder Bay, Sault Ste Marie, Sudbury, Timmins and North Bay -- they can get that connection to Toronto. But we saw a lack of connection from those points to Ottawa and we had complaints, especially from the Highway 11 corridor north of North Bay, that they could not get a connection to Ottawa. There just was not one. We felt there was a void so we filled the void. But we do not think there is a void to Toronto, assuming we get people to those major airports.
Mr Brown: As you know, in the Manitoulin case there was a private carrier in operation that was flying the direct route and for various reasons it found that to be impossible to carry on with. The numbers I was told are that they were carrying approximately 400 passengers between Toronto and Manitoulin per month and that presently the norOntair air service moves about 100 people from Manitoulin either to Sudbury or Sault Ste Marie for connections. I am just looking at it from a service point of view. There was obviously a great demand for the direct flight rather than a kind of shuttle flight to a larger airport. I wonder if the commission would be interested in entertaining a direct flight, given the difference in the numbers in terms of utilization.
Mr Sinclair: There is a seasonal nature to the Manitoulin Air Service, which is summertime only for the most part, with heavy loads in the summer directly into Toronto. It would be expensive to operate.
Mr Brown: I recognize that but I think I was given the 300 as an average number. They were flying daily during their last year of service all year around. Obviously traffic to the north in tourist season is far heavier than it is at other times of the year.
I am just asking you to consider it. I am not exactly sure those numbers are very precise. I would just like the commission to have a look at that because it seems to be a service that was being utilized and now is not to the same extent. You may find some economies there in terms of direct flights that you are not finding in the shuttle service. What I am really saying here is that I am just asking you to look at it. Do not get me wrong. We are happy that you have come in and filled a void that obviously was needed in our area.
Another question I have concerns Algoma Central Railway. Have you been talking to ACR? Have there been any negotiations. Is ACR interested in your getting into purchasing or entering into agreements with it.
Mr Dyment: We have been acting as a resource for the Ministry of Northern Development in talking to ACR and in attempting to evaluate the railway as a commercial venture and run out some prognosis for the future. To the extent that they wanted another railroader's view of how things looked for the ACR now and in the future and what the residual value was, we provided assistance. We certainly have not negotiated with ACR to buy it, nor have we made an offer.
Mr Brown: You acted really in terms of a consultant who has knowledge of operating railroads in northern Ontario?
Mr Dyment: Yes.
Mr Brown: The final question I have -- maybe it is not the final question -- relates to our earlier discussion concerning the minister. Did you supply the minister with the information about those contracts with Bearskin, not necessarily you personally but the organization?
Mr Dyment: I cannot answer that. I do not know.
The Chair: Mr McLean, do you have any questions?
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Mr McLean: Yes, I have two that I could wrap up with. In the letter that was sent to Mr Dubeau by Mr Carmichael, director of bus services, says:
"Please be advised that effective immediately, Ontario Northland is terminating all interline ticketing agreements arrangements with PMCL. Ontario Northland drivers will not accept PMCL tickets on Ontario Northland routes."
The agreement with Gray Coach was that these were interacting and your agreement was that you would take over and supply the same services. It is the public interest I am concerned about. Why would you not allow those interline ticketing agreements to continue as they were with Gray Coach? I cannot understand why you would do that.
Mr Dyment: We will provide the same interline arrangement that Gray Coach had in effect.
Mr McLean: But you are not doing it.
Mr Dyment: I would argue that and I would suggest that we wait until we get in camera. I can get Gray Coach to articulate what the arrangement was.
Mr McLean: I am not worried about that. All I am going by is what information I have. It is here in writing.
Mr Dyment: Is it from a party to the issue?
Mr McLean: I faxed the letter. Yes, it is signed by Mr Carmichael, director of bus services of Ontario Northland, and it was faxed to PMCL advising it that the ticket agreements arranged would be cancelled immediately. That is a public document and it is for discussion. I just want to know why you as head of Ontario Northland would not continue the agreement Gray Coach had. You bought their service. You bought what they had. Why did you not continue on with it as it was?
Mr Dyment: We would be quite willing to continue on with the Gray Coach arrangement.
Mr McLean: Then why was that letter sent out?
Mr Dyment: I think that should be dealt with in camera, but for the public record we would be quite prepared to Xerox the Gray Coach arrangement and change the letterhead to Ontario Northland tomorrow.
Mr McLean: Okay. The final question on this has to do with the routes. You had indicated in my last questioning that you no longer operate Barrie-Midland-Penetang and Barrie-Collingwood-Owen Sound. Is that right?
Mr Dyment: We dropped our request for a licence.
Mr McLean: You dropped your request for a licence and you are not running those routes now?
Mr Dyment: No. We are contracting with Gray Coach, which holds the licence.
Mr McLean: Did Gray Coach and PMCL not have an agreement that PMCL would run those routes and Gray Coach would not?
Mr Dyment: PMCL cancelled that agreement.
Mr McLean: I see. But they were still running it and Gray Coach was not, although Gray Coach probably still had the right to the routes. Would that be right?
Mr Dyment: You are now asking Ontario Northland to comment on a PMCL or Gray Coach question.
Mr Bisson: I want to pick up on something you said a little while ago in light of what my colleague had said. You had said at the beginning that you actually have a good labour relations arrangement with the people who work for the ONR. From what my colleague Mr Waters said, apparently there are some problems. Can you explain what the discrepancy is?
Mr Dyment: I suppose it is an interpretation and it depends whom you talk to. I did explain that we do not have good relations with the Canadian Auto Workers, and we do not.
Mr Bisson: What are the outstanding issues, because that would represent the people who actually work in your shops?
Mr Dyment: No. We are dealing with the railway, which has about 600 to 650 unionized employees. Two thirds of those are represented by six unions. We are negotiating with those six unions right now and they are going well, no problem.
Mr Bisson: What are the outstanding issues with CAW then?
Mr Dyment: CAW wants a 19% wage increase per year and it wants something in excess of 70% in benefits. We think it is outlandish. It is pretty difficult to move things off the table when you are starting with that.
Mr Bisson: My understanding is actually a little bit different than that because I had a chat with somebody in North Bay. The last time I was there somebody buttonholed me on that. The issue actually had to do with some of the non-monetary issues, if you want to consider them that. I think one of them had to do with an employee assistance plan. There was some arrangement trying to be made to put in an employee assistance plan and apparently there was some dispute about whether the workers should actually participate in the plan as counsellors. Do you know anything about that?
Mr Dyment: We had the first employee assistance plan of all government agencies in Ontario. It is still in effect and it is employee operated.
Mr Bisson: I am aware of that. I am just wondering, because that was one of the things that was asked of me.
Mr Dyment: Could you mention the union that referred --
Mr Bisson: It was the CAW people.
Mr Dyment: Then I do not know. We certainly have an employee assistance plan, employee run.
Mr Bisson: It is run by the employees, counselling by the employees?
Mr Dyment: Counselling by the employees with the assistance of the Addiction Research Foundation and we pay for it. The head of the employee assistance program right now is a former union general chairman who is now a union member, so I do not know.
Mr Bisson: I certainly wish you the best with your upcoming labour negotiations.
Mr Dyment: I must say that negotiations with the six majority unions are going well. I would not like those unions to think that I do not feel things are going well, because they are.
Mr Bisson: Just one comment: One of the things that can obviously help in any negotiations is to try to keep comments about the other union to a bare minimum. Who was the trouble with in the negotiation? I would not be repeating that kind of stuff around.
Mr Dyment: But I must answer the questions.
Mr Bisson: I realize that. I just wish you well.
Mr Grandmaître: Mr Dyment, are you in the video production business?
Mr Dyment: No, we are not. We wanted to be but we have now decided against it. We are not.
Mr Grandmaître: When did you decide not to get involved?
Mr Dyment: About November.
Mr Grandmaître: November of last year?
Mr Dyment: Yes.
Mr Grandmaître: When were you asked to consider that possibility?
Mr Dyment: We considered it last summer. As a matter of fact, it gained some impetus on Manitoulin Island, where we felt that there was a good market for us to go and do tourism videos and that the way to pay for it was to get into commercial ventures. But we are not doing that any more. We have decided against doing it.
Mr Grandmaître: Naturally, if you have decided against it, I suppose my next question is useless. Why would you even consider getting involved in video production?
Mr Dyment: Because there are not very good tourism video pieces available for northern Ontario. We wanted to produce for TV, for home consumption and for foreign consumption, videos about northern Ontario as a destination. We could not afford to do it. You are talking about a lot of money. The only way we could do it -- we have internal video equipment for our own use -- and not cost money was to sell our services. We felt that by selling our services outside for anybody who needs video services the revenue we got from that would support doing our tourism videos. We could not go to the tourism operators in the north and ask them to support it because they cannot afford it. This was the only source of revenue we had to provide video productions for the north.
Mr Grandmaître: You are telling me, Mr Dyment, there is nobody in northern Ontario right now in the video business who can provide this government, or any other agency for that matter, with a good video? There is no business enterprise? There is nobody in northern Ontario in the video business?
Mr Dyment: They will do it for a price. We were going to do it for nothing.
Mr Grandmaître: Naturally they will do it for a price.
Mr Dyment: Yes, but how can Manitoulin Island -- and this was our point -- afford to pay for video productions?
Mr Grandmaître: In other words, you would use tax dollars.
Mr Dyment: No.
Mr Grandmaître: That was your intention. To get into the video business you would have used tax dollars to subsidize somebody else, right?
Mr Dyment: No. We have video equipment for our internal purposes. We were going to rent ourselves out and make money and with that money produce videos for the tourism people. But as I said, we have decided against it.
The Chair: Does any other member have any questions before we move in camera?
Mr McLean: Yes, I just have a couple. I am not sure whether I am going back to that letter on the 28th or not. I was reading some of the notes that were prepared by our research: "ONTC informed PMCL it was terminating all interline agreements that it inherited from Gray Coach." My understanding is that PMCL had an agreement with Gray Coach for one year, from 1988 to 1989. There was no agreement with Gray Coach or Stage Coach and you purchased what Gray Coach had. The bottom line is that you have now extended it beyond what they were operating. I just wish you could negotiate some form of agreement that it would be the way it was before you took over, with a private operator able to stay in the business. I do not know whether you can do that or not, but that is what I would like to see you do.
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Mr Dyment: For the record, PMCL has a letter, signed by me personally, which says that all Gray Coach agreements are in effect until we negotiate something different.
Mr McLean: I am going to leave it at that.
The Chair: When were you appointed to the chair?
Mr Sinclair: In August 1989. My term expires June 19 this year.
The Chair: Has there been any indication from the government whether it wishes you to stay on, or have you indicated that you have a desire to stay on?
Mr Sinclair: There have been no discussions at all.
The Chair: Prior to 1989 did you serve on the board?
Mr Sinclair: Yes, I was appointed to the board in June 1986.
The Chair: How much time does the chairman or a member of the board have to devote? We had a reference to 11 meetings per year. I am not sure what this means in terms of time, but I notice the commissioners all serve as directors of seven different boards as well. What does that mean in terms of time commitment for commissioners?
Mr Sinclair: The boards which are served by the members of the commission are subsidiary companies the sole shareholder of which is Ontario Northland. Those are the operating entities, in some cases, of Ontario Northland. For example, the Owen Sound Transportation Co is a subsidiary. It is the entity that operates the boats on the Great Lakes. Star Transfer is one we have discussed; it operates the freight. They are operated as units of Ontario Northland. They are separate legal entities, but they are operated as divisions.
The extra time commitment that a director or commissioner of Ontario Northland makes to those subsidiary companies is just part of his responsibilities as a commissioner. There would be no separate duties. There are separate meetings held at the same time as the regular meeting of the commission itself. We have 11 meetings a year, as you have mentioned, and there might be three or four days a year in addition to that where members of the commission might be travelling to some community where the commission operates services. For example, we have been to Moosonee, Kenora and other areas. Oftentimes those trips out are to coincide with the regular meeting. At the end of March we anticipate having the regular meeting of the commission in Kirkland Lake, which will coincide, we hope, with the opening of the building we have just constructed there.
As for the time commitment of the chair, it is a little hard to tell. I might spend three, four or five days a month away from my home on matters involving Ontario Northland, like today. At the same time, Peter might agree that I phone him too often to inquire about things that come across my desk, communications I might have from people separately or certain matters I am working on that involve the commission where I would be getting in touch with people. It is hard to tell. I think last year it was an average of maybe about four or five days a month that I dedicated to the work of Ontario Northland.
The Chair: When you were appointed by the previous government, did the minister of the day or the Premier -- I am not sure whether it is a Premier's or a minister's appointment, but in any event were you asked to do anything specific with respect to carrying out your responsibilities as chair?
Mr Sinclair: To advise myself, inform myself as to the activities of the commission; to try and deliver some opinions, some expertise, some commitment to the undertakings and the time of the commission, and to try and make a contribution as best I could. I am not a railroader. I am not an airline pilot. I am not a Great Lakes salesman. Nor are any other members of the commission. But when you know the people who are on the commission, there is quite a cross-section. I think the real instructions were to serve the commission as best possible. At the same time, everyone is very much aware that the commission serves the people of Ontario. We try to walk the fine line, as Mr Marchese said this morning. Sometimes in walking the fine line we provide service; other times in walking the fine line we appear to be hard-nosed businessmen. It is sometimes hard to explain to someone in Tobermory that we cannot provide a service because we have allocated funds to, for example, Moosonee or Moose Factory.
The Chair: We just recently dealt -- I think it was mentioned earlier -- with the appointment to the board of Lloyd Marshall, who works on the --
Mr Sinclair: Mr Marshall is an employee of Ontario Northland, yes.
The Chair: Does the board have any reservations about an employee serving as a member of the board? The conflict question arose during our hearings. I would like to know if you have any views on that and if the board has. What union is he a member of, by the way?
Mr Dyment: The United Transportation Union. I might say that when I read the briefing notes, which I got on my desk Saturday morning, the appointment of Mr Marshall was news to me. We have received no official communication, but we are very welcome to have him with us. At the same time, when matters involving areas where he works as an employee and matters involving the board are on the table at the same time, I think he will have to make some decisions and perhaps seek professional advice as to whether he has a conflict.
Mr Farnan: Would that not apply to all members of the board?
Mr Sinclair: Yes.
Mr Farnan: The same standard would apply to this appointee as to any other board member?
Mr Sinclair: Yes, that is correct. We have other members of the commission. For example, Victor Power is identified in the material you have as a guidance counsellor to the Timmins Board of Education. Mr Power is also the mayor of Timmins. There have been discussions carried on between Ontario Northland and the city of Timmins. Mr Power was recently re-elected, in November, but he has to walk the same line. We have had instances where members of the board who are solicitors have had people in negotiations with Ontario Northland; they have had to withdraw from the meetings. Mr Marshall will face a different type of challenge in identifying his potential conflicts.
Mr Jackson: And more frequently.
Mr Sinclair: Perhaps. But at the same time he will be guided by the same principles.
The Chair: Okay, I think we have agreement to move in camera. What I want to indicate before we do that is that the only people who will be allowed to remain in the room are Messrs Sinclair, Dyment and O'Connell and Ms Boston, as well as members of the committee. All others are respectfully asked to leave the room. Hansard will leave the room as well. We will have a five-minute break and then we will reconvene in camera.
The committee continued in closed session at 1458.