CROWN FOREST SUSTAINABILITY ACT, 1994 / LOI DE 1994 SUR LA DURABILITÉ DES FORÊTS DE LA COURONNE
THUNDERS WOODLANDS ASSOCIATION
NORTHWESTERN ONTARIO TRUCKING AND LOGGING ASSOCIATION
STURGEON TIMBER LTD DORION FIBRETECH LTD
KIASHKE RIVER NATIVE DEVELOPMENT INC
CONTENTS
Thursday 25 August 1994
Crown Forest Sustainability Act, 1994, Bill 171, Mr Hampton / Loi de 1994 sur la durabilité des forêts
de la Couronne, projet de loi 171, M. Hampton
Laird Van Damme
Thunders Woodlands Association
Alfred Fortier, president
Sharon Lapierre, secretary
Northwestern Ontario Trucking and Logging Association
David Bak, president
Pat Lundy, secretary
Sturgeon Timber Ltd; Dorion Fibretech Ltd
Keith Harris, vice-president
Kiashke River Native Development Inc
Tim Esquega, president
Geoff Pattyson, forestry consultant
Niigaani Enterprises Inc
Tim Esquega, owner
Geoff Pattyson, forestry consultant
Jack Stokes
River Lake Timber Ltd
C.G. Spittlehouse, owner
Ted Frisby, company forester
STANDING COMMITTEE ON GENERAL GOVERNMENT
*Chair / Président: Brown, Michael A. (Algoma-Manitoulin L)
*Vice-Chair / Vice-Président: Daigeler, Hans (Nepean L)
*Acting Chair / Président suppléant: Ramsay, David (Timiskaming L)
Arnott, Ted (Wellington PC)
*Dadamo, George (Windsor-Sandwich ND)
Grandmaître, Bernard (Ottawa East/-Est L)
Johnson, David (Don Mills PC)
*Mammoliti, George (Yorkview ND)
Mills, Gordon (Durham East/-Est ND)
Morrow, Mark (Wentworth East/-Est ND)
Sorbara, Gregory S. (York Centre L)
Wessenger, Paul (Simcoe Centre ND)
White, Drummond (Durham Centre ND)
*In attendance / présents
Substitutions present / Membres remplaçants présents:
Bisson, Gilles (Cochrane South/-Sud ND) for Mr Wessenger
Carr, Gary (Oakville South/-Sud PC) for Mr Arnott
Hodgson, Chris (Victoria-Haliburton PC) for Mr David Johnson
MacKinnon, Ellen (Lambton ND) for Mr Mills
Martin, Tony (Sault Ste Marie ND) for Mr White
Miclash, Frank (Kenora L) for Mr Sorbara
Ramsay, David (Timiskaming L) for Mr Grandmaître
Wood, Len (Cochrane North/-Nord ND) for Mr Morrow
Also taking part / Autres participants et participantes:
Wood, Len, parliamentary assistant to Minister of Natural Resources
Clerk / Greffier: Carrozza, Franco
Staff / Personnel: Yeager, Lewis, research officer, Legislative Research Service
The committee met at 0900 in the Valhalla Inn, Thunder Bay.
CROWN FOREST SUSTAINABILITY ACT, 1994 / LOI DE 1994 SUR LA DURABILITÉ DES FORÊTS DE LA COURONNE
Consideration of Bill 171, An Act to revise the Crown Timber Act to provide for the sustainability of Crown Forests in Ontario / Projet de loi 171, Loi révisant la Loi sur le bois de la Couronne en vue de prévoir la durabilité des forêts de la Couronne en Ontario.
The Vice-Chair (Mr Hans Daigeler): Good morning, ladies and gentlemen. First of all, I have to excuse myself for my voice but I picked up that bug that seems to be going around and it seems to not improve yet.
Mr David Ramsay (Timiskaming): Is that the Rainy River bug, Mr Chair?
The Vice-Chair: The Rainy River bug, yes. Well, I won't say where it's coming from.
Mr Len Wood (Cochrane North): It is spreading.
The Vice-Chair: In any case, I do hope you can hear my squeaky voice nevertheless. We're continuing the public hearings on Bill 171.
LAIRD VAN DAMME
The Vice-Chair: The first presenter this morning is Laird Van Damme, president of the Ontario Professional Foresters Association and the Ontario advanced forestry program at Lakehead University.
You have half an hour, Professor Van Damme, and if you leave some time for questions and answers at the end of your presentation, it would be much appreciated.
Mr Laird Van Damme: Thanks very much. I'm pleased to address this group. I've never done this sort of thing before.
The Vice-Chair: There's always a first time.
Mr Van Damme: Yes, that's right. I could read my submission and that will take about 20 minutes, or I could be very efficient and highlight the key points and we could probably get through it in 10 minutes. That would leave more time to follow up in summary, I guess.
The Vice-Chair: Proceed whichever way you want.
Mr Van Damme: Okay. Well, I'll summarize what I have passed out to you.
The first page is an introduction and it's fairly long-winded because I'm wearing two hats. I'm pretty comfortable doing that, as I represent two organizations, but I also am speaking from a personal viewpoint. I wanted to make that quite clear.
The Ontario Professional Foresters Association is an association of professional foresters that came into being in 1957 under its own legislation, the Ontario Professional Foresters Act. We have an executive director of the association, who is really the only full-time employee, and he's going to speak to this group later and will provide you with a lot more detail about the association, but it's worth bearing in mind now that some of the legislation that governs the behaviour of that body has some relevance to this act. I go on to make a case later that there are a lot of interrelated pieces of legislation and these all have to be looked at if this proposed act is going to have a real impact and really meet the aspirations of its authors. That's the real case I want to make.
I also represent the Ontario advanced forestry program. This is a continuing education program for professional foresters. As you can see, both programs have an interest in professional foresters, but the association is solely concerned with the behaviour of members, and this behaviour is both an ethical behaviour, a knowledge-based behaviour, an approach-to-practice behaviour, and it applies only to those who are members. It has no jurisdiction over others who are engaged in forestry activities; it has no impact on their behaviour. Now, this act will have impact on their behaviour, so you can see the importance of the interrelationship between this act and the Professional Foresters Act.
The Professional Foresters Association's objective, when it was created in 1957, was "to increase the knowledge, skill and proficiency of its members in all things related to forestry and to regulate the standards of practice of its members." It's only this year that it's getting around to adding standards of practice to the codes of ethics that were put down in writing in 1957. This increase in knowledge, skill and proficiency is also a shared interest of the OAFP, the Ontario advanced forestry program.
We have trouble with the acronyms all the time. In publications and that I call it the Ontario advanced forestry program -- its acronym is OAFP -- but in the submission I gave to you, to keep it distinct from the professional foresters association acronym, which is OPFA, I call the one OPFA in this paper and the other AFP.
Although this year I'm the elected president of the OPFA, I'll be really speaking to this group from personal insights. There wasn't time to get together and provide input that reflects the association in an official way. By the same token, there was no way for me to meet with the people in the Ontario advanced forestry program and put forward a formal case. So I'm speaking to you from my experience in working with these two associations over the last three years, and then building on the experience that I had before as an independent forestry consultant from about 1984-91, where I worked in this province. These are the viewpoints that I'm bringing to this discussion.
The submission has three following sections. I talk in general terms about the legislation, and these are personal reactions when I read it and the supporting manuals. I got a copy of the draft manuals in the mail.
In the first case, the general reaction to Bill 171 is about how power is distributed. I would guess all things in law and politics are about power, and it appears that the minister does gain some power over the cabinet and the Finance minister while remaining responsible for management of crown forests. In this Bill 171, I can also see that citizens gain power through appeal and influence through advisory committees, but citizens can also acquire some measure of authority and responsibility through forest management boards. These are really interesting innovations, by the way, from my perspective. Licensees have more accountability; they assume a greater financial burden, it would seem. The professionals, the ones I'm going to really talk about, the foresters, retain authority as plan authors to certify management plans and may now be required to certify forest operations prescriptions. I'm going to speak a lot about that later.
All of the above tends to bring responsibility, authority and accountability closer to the ground. This is a really positive step. However, some will argue, and I'm sure you're going to hear from them, that the balance of responsibility and authority is not always consistent. For example, licensees appear to have more responsibility but perhaps some diminished authority than existed under the Crown Timber Act, but I'll let them speak on their own behalf, those who hold licences.
I want to make a case not only about the interrelationship between the different pieces of legislation that are implicated by this change to this legislation, but I also want to make a case that the legislation could create some space for the application of professional judgement by individuals engaged in the management of forest ecosystems. It already does this, but it's a matter of emphasis, and that's what I want to talk about in the sections related to professional judgement and certification that follow. This is where I put most of my attention, and most of my thinking went into this.
The legislation is, I believe, unique, and I'm not a lawyer nor a legislator. I don't know of any other, offhand, that is linked to a set of manuals, and these in turn depend upon 38, and counting, guidelines. The interdependency of these manuals and guidelines really requires their availability as a complete set, and it's kind of frustrating that it's hard to find these. Some of them, even the simplest ones, are out of print; for example, the jack pine silviculture guidelines. They're hard to come by, and it would be nice to get them in sets. It's also hard to obtain others that aren't in a constant state of draft. On the one hand that's frustrating, but on the other hand it's entirely understandable. These things are just packed with current state of knowledge about forests, and knowledge is a very dynamic thing. So we're never really going to have these complete manuals, and that's okay; they're in a state of constant evolution.
But what is worrisome to me personally is that the language of the bill gives such weight to manuals and guidelines, the sense of the bill, the tone, and although this is quite consistent with the EA terms and conditions, I see an alarming trend, which is reinforced by some of the manuals, in particular the Forest Information Manual. This alarming trend to me is that knowledge under Bill 171 appears to become more centralized and is acquired more by those who develop manuals and synthesize information under the Forest Information Manual guidelines. They have a standardized information-gathering approach, and I can talk a lot about that later if you want to pursue those ideas.
The problem with this, I believe, is that those who are gaining the greatest insights on how the forest ecosystem is working and how management actions interact with natural processes and change forest cover over time are those who write manuals, and they have nothing to do with on-the-ground application of forest management practice. Now, of course, the intended audience are the practitioners, but it's a single source, these manuals. There's a whole pile of other material that these manuals tend to synthesize, but the original source material, somehow there should be some accountability to look for that.
This requires the professional to be constantly searching for the most up-to-date information. I think the emphasis on the manuals tends to detract from that, and it comes through to me loud and clear in this legislation and the tone in the manuals themselves about how they're a centralized authority of knowledge. I think this is a step backwards. I have philosophical problems with it from a point of view of science and a point of view of adaptive management.
I think this has surfaced as a search for accountability, and I label it bureaucratic accountability, a neatly followed paper trail. It's nice to have real clear standards. However, I think this system might work really well in a lot of human-engineered environments and a lot of environments that produce complicated things, like jet aircraft, but these things have known outcomes, very predictable performance, and forests don't. They just won't behave that way.
All natural systems, be they an individual human being or a forest, are going to have unpredictable responses to stimuli, unpredictable behaviour, and you only find out about it by fiddling with it, searching for knowledge constantly. I cannot imagine legislation for health care that would attach prescriptions in operating manuals for use by physicians. There wouldn't be that link. The unpredictable performance of these systems demands the creative genius of the human spirit and it demands an individual accountability. I want to talk about that, focus back to the people who are making these decisions on the ground.
0910
As an aside, there are about 700 RPFs in Ontario. This is equivalent, by the way -- this is trivia that I just found out -- to the number of foresters who work in the state of New Hampshire, and New Hampshire is about this big on a map and Ontario is this big. There are precious few Ontario RPFs, registered professional foresters, who actually practice forestry on a full-time basis. I'm a case in point. I'm an RPF but I left active professional forestry practice three years ago when I became involved with the Ontario advanced forestry program. I'm now more of an educator than a practising forester. To entertain myself, I look after 6,000 hectares of forest with Abitibi through the university, one day a month. That is not atypical.
Of that 700, it's more like 300 are actually involved out there, and I think this is quite unfortunate. I think it's through their direct and personal intervention that you're going to develop the kinds of applied knowledge that can really be effective in achieving the goals that this bill speaks about, and I don't think the bill puts enough emphasis on the individual. The emphasis is on the manuals, the emphasis is on procedures, and it would be wonderful to see more emphasis on the individuals. That's not to say there's no discussion at all about individuals in this bill, but it's a matter of emphasis, once again.
It does speak in the bill about certain audits and things like this. Again, the attraction of the manuals is some level of accountability. Well, the audits could go and actually audit the individuals and their performance. That's not spoken to in this bill at all. This could be addressed in changes to the bill that governs the Ontario Professional Foresters Association and a variety of other legislation.
I asked a friend of mine who is a forester and then became a dentist -- he works in town here -- "What's happening in dentistry?" He said, "Well, it took 12 years for them to write the new Regulated Health Professions Act." You guys would know about it. What he told me is that they were looking at how you guarantee competency assurance and all this sort of thing, because if you don't have a nice guidelines approach and manual approach so that you always have a solid reference point on how work is being done that's written down, how do you have quality assurance of the individual or the position? They were looking at a variety of means in this new legislation to facilitate this, and they worked with the various professional associations.
The route the dentists took was one of mandatory continuing education, but there are other techniques. In the United States, for example, the teachers have taken on a portfolio review approach. They're required to keep portfolios of their best work, and this is reviewed by peers as a means of recertification rather than mandatory continuing ed, because with continuing ed the assumption is that by embarking on continuing education, you retain your level of competency in the face of changing ideas on how things work. Well, that's an assumption. The only other way, the third way, is to do the audit of the individual. They're doing this in Quebec, but it's a pilot study and it's voluntary, a random audit of the professional foresters in that province.
Now, the Crown Timber Act had nothing to do with this in the past. This bill doesn't get into that sort of thing. But again I'm just making the case that as you consider changes to the Crown Timber Act, you've got to consider changes to a variety of other acts as well.
Certification: The new bill does state that RPFs must certify forest management plans, and they've done this in the past. But I do recall in the EA that they were talking about certification of work schedules and ground rules by an RPF, and it doesn't appear to be mentioned in the bill. I could have missed it. I've only read this a couple of times. It might be in there; I might have missed it. I think that would be an important small point to look at for consistency, because the planning document is one thing, but these other elements of the plan, the standardized elements of the plan, might require additional certification.
One of the most interesting parts of Bill 171 is section 13, which describes operations prescriptions. This is really written quite well. It speaks of a requirement to describe current stand structure before you go in and do any kind of activity, the prescribed actions, and forecasted stand structures. This is the essence of adaptive management, which is alluded to in the other manuals. It's spoken to in section 13, but then the interpretation of operations prescriptions in the manuals is quite contradictory. The planning manual describes a process of identifying preferred options from silviculture ground rules on an operating area map, and then the forest operation manual implies a field survey approach prior to harvest, like what is done now by law in British Columbia, a pre-harvest silviculture prescription where they go in and for each stand specifically state what's going to happen there, and these are all signed by an RPF.
Now, that's quite an extreme situation in British Columbia. They've got now 36,000 of these signed-by-an-RPF stand descriptions on file, and they're not sure what to do with them. Their act came into effect in 1987. Yet still there's something really nice about the way section 13 is written. It really describes elegantly and legally what adaptive management is about that the manuals try to get at. In this submission I go on to say that this kind of wording could be looked at and expanded to approaches to forest management planning that would allow you to perhaps move away from the emphasis upon the manuals that this is a principle we're going to follow in our approach. That part I could understand you could have in law, and a lot of professional people wouldn't have any problem with that.
Why am I hung up on certification? It gets back to where in the very beginning of the paper I talk about building a case for space for professional judgement. I think there has to be space created in the legislation for people to cultivate personal knowledge about forest ecosystems, exercise professional judgement. What ends up happening in the manuals is they try to give the professional space. He can, or she can, for example, do things differently than what is required or discussed -- not required; described -- in the manuals, but has to explain why. That's okay. But again, it's a matter of emphasis. If you can clearly make space -- and I have some suggestions on how to do this in margin notes, but I won't get into that now. It's just the idea I want to get across and keep hammering here: creating space.
So I'm going to finish up right now. I've wandered a little bit from my text. You can read it later. I organize my thoughts most clearly when I write, not always consistently when I speak. It's real easy for me to take off on a tangent.
I mention in the last page about this Regulated Health Professions Act. The idea came from a dentist. You folks might know more about it. I'm becoming really intrigued by it what really happened there. When I get some time later on this month, I want to pursue it further.
I'll be speaking with John Ebbs, the executive director of the Professional Foresters Association, but when we look at changes that might follow from changes to this act in the Ontario Professional Foresters Act, the idea of a self-regulated body certifying forestry and resource management practitioners beyond the classical domain of forestry practice, I think we've gained some public support. I think during the EA process they were saying, "You cannot use the adage `Trust us.'" They were speaking about government-level trust. Individual-level trust among members of society is still fairly high, and this is supported by a recent Environics poll of 1991.
Anyway, I believe this bill is a small step in the right direction. A real stride will take complete revision of a variety of acts. For example, in this crown timber act, "forest ecosystems" and "forest products" refer only to the plant kingdom. There's no reference at all to the animal kingdom. This is probably because that's handled in the Game and Fish Act. But if you're going to really make some strides with this act, the Game and Fish Act has to be looked at at the same time. They can't be seen as separate things. There's the Trees Act and there's a variety of others. A lot of these have gone under scrutiny, but this one has gone furthest, and I'm surprised that it's gone this far without the others coming along with it.
Thanks for the opportunity to address this committee. I'm pleased to answer questions now if you have any.
0920
The Vice-Chair: Thank you. Each caucus is given a certain amount of time for questions, and following the rotation from yesterday, the government caucus is first.
Mr Wood: Thank you very much, Mr Van Damme, for coming forward with an excellent presentation. I just want to look at a couple of different areas. Maybe one area that you've talked about is under your "Power" heading: responsibility, authority, accountability.
I guess at this point in time we've had about two hours of presentations from the Ontario Forest Industries Association, professional foresters who either made presentations on their own or working for the companies, on behalf of the companies. They're saying that Bill 171 is moving too fast, nobody can get a handle on it and it should be delayed. I just want to throw that comment out there to you. You're saying you feel that Bill 171 is a step in the right direction, it's moving ahead and, taken from that, there's been enough consultation out there that the professional foresters know where we're going on that.
Mr Van Damme: I think it's a progressive bill. From their point of view, I can empathize; it might be moving too fast. You're talking about fairly large structures that are harder to change than individuals. An individual can read this and interpret it and say, as a professional forester, there are some things here that make sense, but if I had a licence, it's that balance of accountability and responsibility. For example, there's a clause in there about cease and desist orders if you damage plant life. You can't do any forest operations without damaging plant life.
There are some strange things in the legislation, but I chose not to speak about those specifics because I thought you'd certainly get two hours from them and I think they can make their case stronger than I can. I'm empathetic with their situation.
As far as too fast, I think this took 12 years to get the Regulated Health Professions Act. It's going to take a lot longer than what's been allotted so far for this act, I would think.
Mr Wood: To move from timber to forestry?
Mr Van Damme: I believe so. For example, a buzzword and even a policy on integrated resource management was dominating the way we thought about forestry work last decade, and it's interesting. I could draw you a nice diagram about this because I was explaining this phenomenon to someone just the other day.
In traditional forestry, society was only interested in foresters interpreting forest cover on their behalf as it came to timber. That's what they asked us to do, and we did that fairly well right up until about 1970. Then there was interest in multiple resource use and that required minor modification. Then integrated resource management meant that you not only had to consider timber, you had to look in a different dimension of other values, moose and everything else at the same time. There was no legislative change for that.
Now, the imprint space is not just stands, not just a few different values; it's almost an endless array of values in one dimension, worried about millennia and genetic conservation in the time dimension and worried about stand and landscape phenomena in the spacial dimension.
So this three-dimensional working space just exploded in the last three years, and this legislation is trying to capture that. That's good, it's in the right direction. Our imprint space for work should be that big. But it's a fairly big jump and it's going to require a variety of things. That's why the Ontario advanced forestry program was created, in part to allow practising foresters an opportunity to reacquaint themselves with basic ideas on forest ecosystems to see what this meant for their new expectations. So it's been important for us.
Mr Ramsay: Thank you for your presentation. I just want to get a clarification about how the Ontario Professional Foresters works today. Is it not self-regulating?
Mr Van Damme: Yes, it is.
Mr Ramsay: Okay. Because you say on your last page, "A self-regulating body certifying forestry and resource management practitioners would gain public support."
Mr Van Damme: It's that second word that's the radical one, resource "managers." Right now the "foresters" definition has been pretty classical, and even within our association we choose to have it rigidly defined by a certain type of training. But you have out there, working quite effectively in forestry, people with different backgrounds and other resource management professionals: hydraulics, geographers, biologists, wildlife biologists. All of those are unregulated. There are some regulating bodies for biologists at a national level but not at a provincial level, and that's where it really counts because then it dovetails with provincial legislation. So it's that word; that's what needs to be done.
Mr Ramsay: Okay. On the page before that you say another alternative is mandatory continuing education and periodic recertification of professional foresters. Are you saying there that's what you'd like the government to legislate?
Mr Van Damme: That would involve changes under the Ontario Professional Foresters Act, or we could even do it ourselves if we chose to do it. But the problem is, if you do these things out of sync with one another -- members are voluntary members, you know? Why would they go through all the hassle of mandatory CE if there's not a requirement or a recognition in the workplace? Now, that can be a cultural thing.
Mr Ramsay: Well, this act says that you have to have your working plans certified by a professional forester.
Mr Van Damme: Yes, that's right. There are 90-odd management units so that's 90 foresters. Mandatory CE for 90 people? I don't think so. It would be hard to do; there are logistical things. But I think that 90 is too small and that personal accountability is too small.
Mr Chris Hodgson (Victoria-Haliburton): Thank you very much. I enjoyed your presentation. I wish you had an hour. There's a lot of --
Interjection: He wouldn't get it.
Mr Hodgson: He wouldn't get it, no.
Interjections.
Mr George Dadamo (Windsor-Sandwich): Time's up.
Mr Hodgson: Yes, really. Thanks, George.
Mr Van Damme: I talk too much as it is. I can talk for an hour.
The Vice-Chair: Mr Hodgson, you have the floor.
Mr Hodgson: Yes, thank you very much. Can you go through with me again this question of where your concern is about centralized authority on the data collection?
Mr Van Damme: Yes. It's the language and general intent of the legislation relying upon manuals, and in particular the Forest Information Manual. It's talking about a way of standardizing data collection, and then it's all interpreted.
I think centralized data collection can be really useful if it's only for centralized purposes. It appears they're trying to use this to also feed back information for local decision-making. For example, I think Statscan is an incredibly effective organization. They have a standardized survey. It's theirs. It's centralized data collections that they use. People can access it, interpret it at their will. That's okay.
But what I find in practice is that sometimes a client wants to know a particular thing about a forest. It has always ended up being, to be effective, a customized survey, customized data collection, with real specific purposes for a particular user.
This emphasis on the Forest Information Manual is one of a standardized approach across the province so that all can be aggregated upward so that they don't have to do their separate surveys, like Statscan does. So it's a pattern that's worrisome. It's a pattern that's reinforced in each manual. It's a pattern that tends to be reinforced in the language of the bill, and this pattern is this centralized knowledge idea that I have. It's hard to put your finger on it.
Mr Hodgson: You touched upon an issue that's kind of the heart of this whole bill and that's the credibility or the accountability with the public. As you mentioned, there are three dimensions here that we're trying to show sustainability on, and you're suggesting that if you're making a jet airplane, you have an outcome that's very specific and you know what you want to achieve. It's dynamic and it might change. How do you get that public trust and that accountability at the same time?
Mr Van Damme: I think some of the better parts of this legislation are beginning to build that. The allowance for these forest management boards is a real good innovation, and it looks like it builds on the ideas behind conservation authorities, forest authorities. The trust comes from a stronger sense of ownership at a local level, I think, and this is moving that way.
What does this mean for the individuals and how they respond? An example of this is, for a lark -- not a lark -- as part of an educational experience in one of our modules in the Ontario advanced forestry program, we asked a group of 20-odd practising foresters for their definitions of "sustainable forestry." Most of them tended to hinge around the Brundtland definition, you know, "meeting the needs of today without compromising the needs of the future" kind of thing. But one said, "It's whatever we decide it to be at that time," and that was a real interesting one.
The general principles behind the concept of sustainability everyone can hang on to. The specific nature, for people to really have a sense of credibility and a sense of ownership, they must decide on their own, and that could change region by region, I would think. The nitty-gritty is going to defy codification.
Mr Hodgson: Exactly.
The Vice-Chair: Thank you very much for appearing before the committee. You certainly brought some new thoughts and challenging ideas before the members, and they will try to reflect those, hopefully, in the clause-by-clause considerations in the middle of September.
0930
THUNDERS WOODLANDS ASSOCIATION
The Vice-Chair: The next presenters, I understand, are here: Thunders Woodlands Association, Mr Alfred Fortier, president. Could you have a seat, please, and also introduce the lady who is with you. We have simultaneous translation if anybody wishes to use French either in their presentation or in the questions and answers. So if you'd go right ahead and introduce yourself again for purposes of Hansard, and the lady who is with you.
Mr Alfred Fortier: My name is Alfred Fortier. I'm president of Thunders Woodlands Association. I want to present my secretary, Sharon Lapierre, the one who is speaking for us basically.
Ms Sharon Lapierre: I'm Sharon Lapierre, and basically what I do is assist in interpreting what we have to present in English for him.
I'd like to thank you for allowing Thunders Woodlands Association this opportunity in presenting its opinions and concerns regarding this very important bill.
The Thunders Woodlands Association represents 118 independent logging contractors. We are the grass roots of the logging industry as we operate the feller-bunchers, skidders, delimbers and slashers in the forests. We represent a significant part of the logging industry in northwestern Ontario. As such, we take great pride and interest in the implementation of Bill 171 as it has a direct impact on our livelihood and that of our children.
We appreciate the doors being opened for involvement and participation by groups such as ours. We work in the forests on a day-to-day basis and we also share your concerns in forest management on all fronts; namely, social, economic and environmental needs. We believe our input can enhance certain areas of Bill 171.
We are looking at this section with the understanding that a large company would have to prepare a forest plan for a management unit.
Subsection 9(2), "Minister's powers": "The minister may approve the plan, reject it or approve it with modifications as may be made by the minister."
Recommendation: The minister must clearly state that any penalties and/or fines imposed on the holder of the forest resource licence must be paid by the holder and in turn the holder cannot impose that cost on to an individual independent logging contractor. In other words, the licence holder is held accountable.
Reason: Situations have arisen in the past whereby an independent logging contractor, under the direction of the employer, had to move to another cutting site and was not given sufficient time to clean up the area. The independent logging contractor had to incur the cost of the fine plus the cleanup cost.
Results: If the recommendation is implemented, two things would happen:
(1) It would assist in preventing infractions under the act, as the licence holder would have to absorb the cost.
(2) The independent logging contractor would be given proper time allotment in cleaning up an area prior to moving to another site and also would not incur exorbitant unfair expenses.
Under part II of this legislation, section 12, "Local citizens' committees": "The minister may establish local citizens' committees to advise the minister on the preparation and implementation of forest management plans and on any other matters referred to the committees by the minister."
Recommendation: Any large holder of a forest resource licence: The minister shall establish local citizens' committees which would include the independent logging contractor or their representatives.
Result: Minister will obtain a clear picture of the situation; long-term viability of large companies and independent logging contractors, as proper forests conditions will be maintained.
Under part IV of Bill 171, "Measurement of resources," subsection 42(1): "A person shall not remove forest resources in a crown forest from the place of harvesting unless the resources have been measured and counted by a licensed scaler."
Recommendation: All wood should be scaled by Ministry of Natural Resources scalers.
Results: consistent scaling practices. This would avoid the use by companies of volume tables and cull standards different from those applied by the ministry, which result in different volumes being calculated for the same timber, as admitted by Cameron D. Clark, regional director, northwest region, June 29, 1994. His letter is attached to this presentation for your convenience. It would also resolve the conflicts between the holder of the forest resource licence and the independent logging contractors. The ministry would have control of the situation.
"Exception," subsection 42(2): "Subsection (1) does not apply if the person has the written authorization of the minister."
Recommendation: specifics required if it impacts on the independent logging contractor, as he/she must be informed.
Part IV, "Methods of measurement," subsection 42(3): "A person who measures, counts or weights forest resources shall do so in accordance with the Scaling Manual or, if directed by the minister, in such other manner as the minister may direct in writing."
Recommendation: ministry official staff scales and weighs forest resources.
Results: eliminates problems and conflicts; ministry has situation under control.
"Records," section 43: "A person who removes forest resources from a crown forest shall keep such records as are prescribed by the regulations."
Recommendation: ministry scales and weighs the forest resources.
Results: problem solved; accurate records kept at all times.
General: We would like to recommend that this legislation be written in a working person's language.
British Columbia's Ministry of Forests Bill 13-158.4, mediation and arbitration under contracts and subcontracts: authorizes the Lieutenant Governor in Council to establish a mediation and arbitration system for use in resolving disputes under timber harvesting contracts and subcontracts. We believe that this piece of legislation is significant and would prove to be appropriate if incorporated into Bill 171.
In the management of the forests, every tree that is cut should be processed. That would eliminate waste on the forest floor and also eliminate any unnecessary cutting.
The importance of accessibility to the Ministry of Natural Resources by the independent logging contractors in the forests cannot be stressed enough. It is only appropriate to repeat one more time that as long as the holders of the forest resource licences are allowed to scale their own wood and use volume tables and cull standards different from those applied by the ministry, the result will be different volumes being calculated for the same timber.
In conclusion, meeting the present and future needs of the forests requires the full participation of all forest-related industries and workers. We support Bill 171. We sincerely hope our suggestions and recommendations are taken into consideration for the implementation of an act to provide for the sustainability of crown forest products in Ontario.
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Mr Frank Miclash (Kenora): Thank you very much for your presentation. It's very straightforward, very easy to follow. As you may have noted in the newspaper on Monday or, I guess, Tuesday's newspaper, a presenter who was before us on Monday felt that Bill 171 would have very significant effects on his operation. He was an independent contractor. Do you see any of these effects on your operations as well?
Le Vice-Président : Si vous voulez vous exprimer en français, on a la traduction simultanée.
Mme Lapierre : Okay. Tu peux parler en français, Fred.
Le Vice-Président : Une seconde, s'il vous plaît, pour distribuer les petites machines.
Ms Lapierre: Excuse me, sir, do you also have a machine for him so if someone asks a question in English -- ?
The Vice-Chair: Yes.
Mme Lapierre : Ça fait qu'il va demander en anglais.
Mr Ramsay: Might I suggest at the beginning of every day that everybody get the headphones so we don't have to interrupt the presenters? It should be just a matter of course so that the flow can be continuous and people feel comfortable speaking any language they wish.
The Vice-Chair: We'll take that into consideration.
Est-ce qu'on est prêt ? Alors, je demanderais à M. Miclash de répéter sa question. Mr Miclash, if you'd please repeat your question.
Mr Miclash: I was asking the presenters what effects they see Bill 171 having on their operation. As was indicated by an independent operator who was before the committee on Monday, he felt that Bill 171 would have grave effects on the operation that he was conducting in the forests. I'm just wondering what you have seen in terms of the effects this bill will have on the independent operators.
M. Fortier : Numéro un, ce qui figure sur le bill : si on regarde le gaspillage de bois qui se fait actuellement dans les forêts, comme jeter du bois à terre et puis le laisser pourrir puis le «movent» pas back, ils ne le «movent» pas où il doit être et le reste du wood reste où il est. Tous les employés qui charrient ce bois-là ne sont pas payés pour ça. Ils ne sont vraiment pas indemnisés pour le bois qu'ils ont coupé et puis le bois n'est pas posé pour aller au moulin.
On a des mouvements actuellement qu'on peut montrer plus dans le nord de l'Ontario, et une compagnie surtout. On a des «pictures» là-dessus pour montrer la réalité que le bois est vraiment endommagé dans nos forêts ici dans le nord.
On a dans le moment des scales qui sont vraiment short par nos contracteurs à l'heure actuelle. On a des proofs qu'on peut montrer partout. On a des fois des scaleurs qu'on a scalé back et les contracteurs sont tant dédommagés pour l'ouvrage qu'ils ont fait, absolument.
Mr Miclash: My second question is around the local citizens' committee, part II of the bill. You've come up with a good suggestion here that the independent contractor should be a part of these committees. Who else do you see as being members of these particular committees and what would you say the mandate of the local citizens' committee should be?
Ms Lapierre: For that particular section of part II, I would think the forest technicians, specialists of the forest, the grass-roots individual and, I would even venture to say, even the large companies should be represented. That way you have a full body of people. Neither side is biased, but you're balanced.
We have the expertise with the professional foresters. You have the grass-roots individuals who are certainly very knowledgeable if they've been in the bush for many years. Also with the individual companies, their cost etc -- they certainly know that at the tip of their fingers. For balancing, I would think that would be very important and perhaps even an environmentalist; a good solid core of people from different walks of life to ensure balancing for everyone concerned.
Mr Miclash: Do you see other users of the resource, such as the tourist operator, the anglers and hunters, groups such as that as well being part of this?
Ms Lapierre: Very much so because if we do miss that sector, which is such an important sector, we'd certainly be amiss in arriving at concrete goals.
Mr Hodgson: Thank you very much for your presentation. You've got a couple of issues in the appendix of this letter that was sent to -- firstly, your association's got 118 independent members. It must be quite a job. The independents in our area are independents for a reason: They like being independent. I commend you on that.
I want to go into this whole issue of scaling with you. You're suggesting that the ministry actually do the scaling or standardize the scale method and make it one method. The difficulty I'm having is that if the MNR -- it has an interest as the crown, as the owners of the land; they don't own it, the people of Ontario own it -- is responsible for that to make the volume look high -- the person cutting the wood has an interest to make the volume look high, but the company that processes it has an interest to make the volume look low. Are you suggesting that the MNR get involved in that as the land owner? I've owned land before that's taken logs to the mill and I'll tell you, the mill owners wouldn't like it if I was the one measuring it.
Ms Lapierre: Yes, we certainly anticipated running up against a bit of opposition with that recommendation. There are a couple of avenues that can be taken. The MNR certainly should have more direct control as to the resources that are being removed from its land. As with any other business, you have to be able to control the flow.
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I was at one meeting with Minister Howard Hampton and Minister Shelley Martel where in fact the individual who works for the forestry service had stated that he has scaled approximately 500 skidways over a two-year period. We're looking at a million of those logs being hauled out in a year, so you see we're way out of balance here. Something has to come up so that it would be fairer, perhaps with the ministry being involved, having its scaler but also an independent scaler, independent of the ministry service and of the company.
Mr Hodgson: That's what I was wondering, if we could get something like that --
Ms Lapierre: Exactly.
Mr Hodgson: -- sort of like an independent audit, but have it in the scaling thing; they'd be independent, instead of the standard measurement.
Ms Lapierre: Exactly, and perhaps if the Ministry of Natural Resources could not have all those scalers available, at least in the bush once a week and the independent scaler following through, there would be recourse for the independent loggers to say, "The job just isn't being done here," and with that resource both the company and the loggers then are on equal footing.
Mr Hodgson: I could agree with that. That's a good concern. On this letter of June 29 that was sent to you from the regional director in the northwest region, can you explain to me how you read that third paragraph? What does that mean?
Ms Lapierre: For scaling there is the Wolf River system and there is also another system applied. Unfortunately, for the Minister of Natural Resources the companies are allowed to use the Wolf River system, but when it comes to actually scaling the wood, for the loggers another system is applied, yet you're looking at the same log or the same pile of logs, but you're getting two different averages here. I do not have an in-depth research as to exactly how both systems are calculated, but it is exactly how he explains it; we are coming out with different measurements, which doesn't seem quite feasible. A pile of wood is a pile of wood.
Mr Hodgson: I guess we'll have to ask the minister how the stumpage pays.
Mr Wood: Thank you for coming forward with what I see as an excellent presentation in support of Bill 171. As were the presenters prior to you, you're saying there are some recommendations and suggestions. One of them I notice is that you're saying you'd like to see a pamphlet or a simplified plain-language leaflet out there explaining what is happening with Bill 171. This recommendation was also brought forward by another presenter a couple of days ago, suggesting the same thing, that we get plain-language pamphlets out there to the general population.
I'm interested in your saying that your group represents 118 independent logging contractors. That is a significant portion of the logging that is done out in northwestern Ontario. In supporting Bill 171, your concern is not about job loss or extra cost involved in this?
Mme Lapierre : As-tu compris ça, Fred?
M. Fortier : Non, je n'ai pas compris ça.
Ms Lapierre: No. At this time, the scaling factor is --
Mr Wood: You're quite --
Ms Lapierre: Yes, and of course job loss is always a concern but in these present times, with mechanism --
Mr Wood: You're not concerned.
Ms Lapierre: No, we don't think this bill -- it'll certainly have an impact on price increases etc, but not significantly enough. Our main concern is the proper administration of scaling.
Mr Wood: There's a section in there, section 13, which means regenerating -- you don't really have to refer to it -- how do you regenerate a forest? Some of the phrases we've been using over the last couple of years are that if you go out and cut a hectare of forest, you should be able to regenerate that hectare of forest in 70, 80 or 90 years.
I'm wondering if you had a comment, or how you feel on this approach that we've taken over the last couple of years, compared to counting the amount of trees we put in the ground, the seedling and then say: "This is what we've done." Now we're saying that what is cut should be regenerated.
Ms Lapierre: Whatever is cut should be replaced; the exact amount should be replaced.
Le Vice-Président : Je vous remercie pour votre présentation. Ça termine les 30 minutes qui ont été allouées à vous. Je peux vous assurer qu'on va prendre au sérieux vos commentaires. We thank you for appearing before the committee and we will certainly take your comments into serious consideration.
Mr Ramsay: Is it possible to bring up a point of procedure?
The Vice-Chair: You can always bring up a point of procedure. Of course, we would not be able to discuss it at length right now, but if there's an opportunity to do so later on. We have had cancellations before. That opportunity will present itself.
Mr Ramsay: I would just like to ask the committee to reconsider the vote it took yesterday in not allowing the Ontario Forest Industries Association to come before the committee for an hour instead of 30 minutes. I was in Toronto yesterday, and Marie Reuter, the executive director of the association, called me and she was quite shocked that this committee would not give another half-hour to basically one of the largest associations representing the industry when I know there is time next week.
As you know, it's a very long bill, it's very complicated and their presentation would exceed a half-hour and of course they want to allow members time to engage in questions. I've just put before the committee that we would reconsider it so we could give some positive news to one of the biggest associations in the province.
The Vice-Chair: That's certainly a point you may want to bring up again. However, the next presenter is here and I think it wouldn't be fair to the presenter to begin a lengthy discussion on the point that you raised. However, as I said, either at the end of the morning or if there is a cancellation, you may well bring this point up again and we can then have a discussion of this matter.
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NORTHWESTERN ONTARIO TRUCKING AND LOGGING ASSOCIATION
The Vice-Chair: Northwestern Ontario Trucking and Logging Association, Mr David Bak, president. Please introduce yourself and the lady who's with you.
Mr David Bak: My name is David Bak, president of the Northwestern Ontario Trucking and Logging Association and our secretary, Pat Lundy, is here with me today.
We haven't had a great deal of time to study this proposed legislation. I haven't really kept up to date on what you've got back in feedback. I saw a little bit in the paper. They said it's vague and fuzzy, and we'll have to concur with those sentiments, I guess. It seems to me there are a lot of good things in this legislation, but there are a lot of vague things too, and it's being rushed a little bit fast. I think it's such a change and there are so many different aspects being brought into it here. You've probably heard all that anyway. We've got another few points I'd like to delve into regarding private lands mostly. I'll just read on here a little bit.
The purpose of the Crown Forest Sustainability Act, as defined, is "to provide for the sustainability of crown forests and, in accordance with that objective, to manage crown forests to meet social, economic and environmental needs of present and future generations." Now, "crown forest" is defined as "a forest ecosystem or part of a forest ecosystem that is on land vested in Her Majesty in right of Ontario and under the management of the minister." Therefore, the intent of the act would appear to be to provide for the management of timber on crown lands. So that's on crown lands only.
However, when you arrive at subsection 58(1), you find a new legislated right for any ministry agent or employee to enter and inspect private land at any time that agent or employee feels is reasonable. Subsection 58(1) is under the "Remedies and Enforcement" section, but there's no provision in there for ministry officials to produce a search warrant or show cause, show grounds for suspicion or anything like this. It seems just a flat legislated right to walk in at any time, and that's on to private land, when we're dealing with a bill that's dealing with crown land, as far as I can understand it.
We don't think private property should be opened up to intrusion by public officials at will, and we note that in the past, attempts by the province to force work permits, the Trees Act and these other regulations on private land owners has helped to force down property values, especially in the rural areas, because you're scaring away buyers who can no longer rely on privacy and enjoyment on their property. Just that fear alone is not helping property values.
If there's a suspicion of stolen timber, for instance, being on private property or something like this, I'm sure there should be something in the legislation that the agent or ministry employee has to show cause or prove grounds for suspicion, or a search warrant at the highest level, but there should be some justification, not just a flat legislated right that anybody can walk across the front of your patio any time and for any reason. This is a pretty broad interpretation, especially when you're dealing with crown lands in the first place.
Another section there is the crown timber reservations. As we stated earlier, even though this act appears to limit a crown forest to crown land, paragraph 29 of subsection 67(1) of the draft regulations allows the ministry to grant cutting licences on private land to individuals and companies other than the land owner of that property for the harvesting of trees that are reserved to the crown in the original patent. Clause 2(a) of the regulations also provides for management and regeneration plans to be prepared for crown timber on the private land where the harvesting is to take place. The regulations seem to indicate that the land owner with crown timber reservations will pay all or most of the regeneration cost on their land in this process. It's a little vague, and there's another thing that should be ironed out that we see.
Most private lands that have timber reserved to the crown -- it's mainly pine trees -- were patented under the various legislative acts, such as the Mining Act, the Boer War veterans act, the Public Lands Act, the Homestead Act, and you can go on and on, the Fenian veterans act. Processes were made available under those acts for the disposition of crown timber for harvesting by licence holders or the land owners themselves, and those processes have been in use for decades.
However, not one of those acts provides for government-enforced regeneration programs forced on the land owners who have these pine or crown reservations for the trees. That's quite an expense added on. How much it'll be we don't know. We don't know what the stumpage rate will be. The old acts, mining acts etc, say that the land owner or the licence holder will pay the going rate for stumpage. We don't know what that is. What's it going to be now with these regeneration charges added on? There's this pretty grey area here for dealing with.
I'd like to add that many of these private lots with pine or other trees reserved to the crown have been managed for generations by the land owners, consecutive land owners, and they've received nothing from the crown for their efforts. The crown has taken no interest in managing these properties, and all of a sudden they want to step in now. We don't think the ministry should be allowed to step in, grab the high stumpage fees and put the forest regeneration and forest management costs on the individual land owners. After all, it's the land owners who have paid the taxes on these properties, in most cases anyway.
One other item is on the "forest resource" definition. it would seem that there is too broad a definition for "forest resource" in the act. The definition should be revised to clearly exclude private timber. We would suggest the following wording:
"`Forest resource' means trees and any other type of plant life prescribed by the regulations that are the property of the crown that are in a forest ecosystem."
That would clear that up for future problems, future interpretations.
Outside of that, as I say, there are many good points in the act, but I think there are a lot of things that have to be cleared up that you should be dealing with and involving the public a little more. And bringing this into private land when it's defined as for crown land, I question even the legality of it, to be honest.
Thank you. That's basically all we had to say on that part.
Mr Gary Carr (Oakville South): Thank you very much for your presentation. Up to this point, I wonder what type of involvement you've had with the bill. Have you been involved in it, or with the --
Mr Bak: Not really. It just came out and we got something about a month ago.
Mr Carr: Yes, and you haven't had too much time, I guess, then, to go through all the various manuals and regulations?
Mr Bak: Not really. I've looked at some of the regulations. I've scanned over it.
Mr Carr: Many people have said that, and as you know, we're going to be going through clause-by-clause in September. As things come out, a lot of people, as they dig into it, may have some more suggestions, so we would encourage you to send anything you have to the clerk, who then would distribute it, because I think we ran into a little bit of a time squeeze. In a lot of cases, people didn't have a chance to go through it and we're talking about something very complex.
One of the questions I've been asking various people, particularly the large companies that have come in -- because they've come in and they've talked about some of the things they'd like to see changed. Almost everybody to a person has said they agree with the theory behind why we're putting this act together and they agree that everything, including the title, is fine, but when you get into the nuts and bolts, many people are very concerned about it.
As we've gone across various communities in the north, Spruce Falls, Avenor here, E.B. Eddy, have said if there aren't major changes, we shouldn't pass the bill. It makes it very difficult for somebody like myself, who will be one of the 129 members who gets to vote on this bill, when you hear from communities with large employers -- in each of those communities they're probably the largest employer -- that are saying to me: "Don't pass this bill. If you don't make the major changes, we don't want it."
I just wonder what your thoughts are. If the bill isn't changed, if you were in my position, the one who gets to vote on it, how would you vote when it comes to the third reading and final passage of this bill?
Mr Bak: Don't pass it the way it is, whatever you do, please. Don't leave the door open with a bunch of --
Mr Carr: You wanted to say something too?
Ms Pat Lundy: No. I agree with you.
Mr Carr: You just wanted to jump forward and say it too.
Mr Bak: Do it right or don't do it. Don't rush it through, whatever you do.
Mr Carr: I don't know as a group how much opportunity you have to follow what goes on, but since I was elected in 1990, I've seen bills come in with a tremendous amount of amendments. Over the last little while, I've seen some bills go through the way they are. We will be attempting to take your thoughts into consideration in proposing amendments, but as you know, even on this committee, the government has the majority.
If somehow you can find out what is happening, and it'd be difficult to do that, and follow it, I would like some guidance on it, because I will tell you right now, I will be voting against it based on what I've heard from the various people unless there are major changes. I don't know how people in communities, whether they be the member from Thunder Bay or even Len in Kapuskasing, could vote for something when their largest employer says, "Don't vote for it."
So it's going to make it very difficult, but we are going to have some amendments come forward, and what I would encourage you to do is somehow try and at that point make a decision, because we don't get, after clause-by-clause, a chance to say, "Well, maybe the regulations will be better and maybe things will change." We will need your guidance and I would encourage you to do that as best you can so that when the vote comes, we'll be able to make an informed decision on how to vote. But I appreciate you coming forward and giving us your thoughts, and we'll continue to look for your guidance.
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Mr Wood: Thank you for coming forward and making some ideas and suggestions. You've made some comments as far as private land is concerned and why that is covered in here. What we're talking about here is under the Crown Timber Act, amendments to the Crown Timber Act to the present act, Bill 171, and those sections were in the Crown Timber Act of 1952, which is 40 years ago, to allow for the seizure of timber if dues weren't being paid on it on private land. So it's on the advice of the Attorney General and those ministries it's continued on in Bill 171. It's nothing new; it's just that it's still covered under that particular act.
Mr Bak: The legislated right on to private, though, is a little bit more broadened and intrusive, as far as I'm concerned, in this act than it was in the old Crown Timber Act.
Mr Wood: Yes, I know exactly what you're saying, but it's not something new. It's been there for 40 years, and it was probably there in the 1926 timber act as well.
There's no doubt that there are going to be some discussions in the fall on what kind of template or plan is out there for the private lands. Mr Hampton has mentioned this in the Legislature on first and second reading, that right now we want to deal with the crown lands out there and that there be some discussion with all three parties as to how we set the template out there for the private lands and the forests that are on there.
I don't really have a question, other than following up on what Mr Carr is saying, that there is some opposition to the bill without certain amendments or clarification on it, but there is also a lot of support. The presenters who came forward this morning are very strongly in support of Bill 171 moving ahead, and there's no fear of losing any jobs or any extra costs involved. I know Mr Bisson has a question that he wants to ask.
Mr Gilles Bisson (Cochrane South): I'd like to apologize; I didn't catch your whole presentation, and the questioning caught my interest. I'm looking at subsections 58(1) and 58(2) of the act, and basically what it says is that it gives the ministry the power to be able to go and inspect land in the event of this act. In other words, if there are forestry practices happening on land that are inconsistent with the act, they would have the ability to go and inspect. Just to clarify for me exactly, do you feel the crown should have no jurisdiction over private land, is that what you're saying, when it comes to reforestation?
Mr Bak: Well, not in reforestation. If there's an agreement or there's a -- but this leaves it open to any -- if there's one pine tree on a property, and 85% of the land in this country has a pine right on it, that allows anybody any time to come in and walk right through.
Mr Bisson: For what purpose, though?
Mr Bak: Well, for any purpose.
Mr Bisson: Because what I understand --
Mr Bak: It doesn't preclude any purpose, does it?
Mr Bisson: I just want to make sure I understand where you're coming from, because if there's a question, you know, that the right to privacy and the right to tenure of land is something that's very -- it's what our principles are all about in this country. I'm trying to figure out, because what it says is that it's in regard to this particular act and that you can't go into a private dwelling or anything else unless you've got a search warrant, which is consistent with the laws of the land, and I'm wondering, I'm not too sure --
Mr Bak: Well, you've got it -- I mean, your forest --
Mr Bisson: Is your fear --
Mr Bak: It doesn't, but okay. As I say, you're dealing with crown land. In one place you say crown land and the next place you're jumping into private land. Is this bill dealing with both or it is dealing with crown lands, land vested in Her Majesty in right of Ontario?
Mr Bisson: So the point is, if harvesting is happening on private land, your belief is that 171 should not be applicable. Is that what you're saying?
Mr Bak: If it's a crown timber reservation, there's supposed to be an agreement anyway. Then that's understandable, of course. The ministry employees already have that right, or an agent of the ministry, to go on to private land to --
Mr Bisson: So as long as the entry on to the land is consistent with the laws of the land, that's fine. That's what you're telling me.
Mr Bak: Yes.
Mr Bisson: Okay. I've got you.
Mr Michael A. Brown (Algoma-Manitoulin): Good morning and thank you for your presentation. You have raised some issues that previously hadn't been raised, and I think they're important issues, especially regarding the entry on to private land. It seems to me that we are providing a huge new power to the ministry here. If everything was subject to section 2, to the search warrant, would that satisfy your particular concern here?
Mr Bak: Well, they should show grounds or there should be something there. It should be spelled out a little different than it is. That's too broad an opening there for abuse in the future.
Mr Brown: It would seem to me to be consistent with other Ontario law that we would require a search warrant --
Mr Bak: I would think so.
Mr Brown: -- on private land and that that would be the remedy here. I don't know why it's written and haven't heard a satisfactory explanation from anybody about why it is written in such broad terms. I always have this fear of Big Brother, justified or unjustified. In an age of photo-radar and an age of increasing electronic surveillance of the ordinary folk, it seems to me that Parliament, or the Legislature, has some duty to look after the rights of individuals in this province.
On the second question, I know you've raised this issue with me on a number of occasions, and that's the trees reserved on crown land, and in this area I understand it's mostly pine. We heard a presentation, I believe it was in North Bay or Kapuskasing -- North Bay, I believe -- from a forester who was in the employ of the ministry at one point but is now a consultant, who is suggesting a very radical remedy, and that was, he believed, because at least in the northeast in some areas, there are huge amounts of timber on private lands that are not really looked after by anybody -- the owner is absentee, and often we don't even know who the owner is any more -- there is a huge amount of timber that is not being utilized in a way that is appropriate. Is that the case in the northwest I guess is what I'm asking.
Mr Bak: There are not that many areas. There are a few absentees. There are some people from Europe who own a few large tracts.
I can understand that there is some need to manage or to -- you don't want to see the timber falling down, but I guess I'm saying, let's manage the crown land first, if we can do that. We see budworm by the hundreds of thousands of cords going down and that's not being managed, and the pine rights, the pine trees on the private lands, haven't been managed. Now, let's try to manage crown land, and I'm sure our ministry people -- they've got enough to do with crown land. I don't think they want the added burden of investigating every private land in the property in the district. I think they've got enough to do just looking after crown these days, especially with the cutbacks and everything else, budget cuts. Let's look after that first. That's our opinion.
Mr Brown: I've heard the argument from some friends of yours that the pine that is on those private lands certainly hardly belongs to the crown any more. The crown got their timber three generations ago, and it was replanted and tended by other people, and now we have mature stands again and the crown had little or nothing to do with those trees.
Mr Bak: That's true enough. The thing is, as I say, they haven't managed it, but now they want to come in and take over, get the high stumpage out of it and force the land owner into -- I mean, you might as well just walk away from those lots and let them go for taxes. They're going to be worthless if they have any amount of those reservations on there.
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The Vice-Chair: We actually have a little bit of time, since the next presenter is only scheduled for 10:30. We can either begin with the next presentation or, Mr Ramsay, if you want some discussion of the point that you brought up earlier, we have about seven minutes.
Mr Ramsay: Thank you, Mr Chair. Yes, I'd like to, and that's why I wanted to give some advance warning, so the members of the committee could think about the motion I would be about to then put on the floor. I would move that we would again consider the request by the Ontario Forest Industries Association for an hour of the committee's time to discuss the very important forestry bill that's before us today. Is there a seconder?
The Vice-Chair: The motion doesn't require a seconder. Do you want to write that out? Mr Mammoliti.
Mr George Mammoliti (Yorkview): While I appreciate Mr Ramsay's motion, I need to talk a little bit about why I'm not going to support it. It's no secret to anybody that I think that in view of what's happened with the subcommittee in the past, and talking about how much time should be allocated to presenters and finding out as well that there had been many people who have asked for more than a half-hour, and because we have wanted to expedite and hear from as many people as we could, a half-hour was allocated to everybody. To pick one group and say this one is more important than the rest I think is unfair to the rest of the groups. What will all of those other groups say if they find out that we are allocating one particular group an hour when a lot of them would have preferred an hour in front of this committee? So, in view of that, I would suggest that we continue with the schedule as planned, and I'll be voting no to the motion.
The Vice-Chair: I encourage everyone to be quite brief because we have only five minutes.
Mr Carr: I'll be very brief. As I look at it, this is a bill that's very important. If we can't give one extra half-hour to an association that represents major players in here, then I think there's something wrong. They have a detailed presentation. I think most other people, including the companies that are represented and have been in here, would say that this group deserves extra time. I think it would be silly not to give an extra half-hour to a group that's such a major player, so I'll be supporting Mr Ramsay in his motion.
Mr Brown: I of course made the original motion, so I'm in support of hearing from the forest industries association. To the point that Mr Mammoliti made, I am not aware, as a member of the subcommittee, of any group that has asked for more than half an hour. I am also aware that informally, anyway, and at least in practice, many groups have had 45 minutes before this committee because there was the time available. I'm also unaware of any group that the committee has refused to hear. We have heard everyone.
There's no time pressure on this bill that would require the committee to hold hard and fast to a half-hour rule. When you're looking at the Ontario Forest Industries Association, you are looking at the major players, from an employment standard in the province of Ontario, talking about a change to a bill that was first enacted in 1952. We're talking about 42 years later, major changes and we're not willing to listen to them for more than half and hour when we have the half an hour.
A union gladly said, "We'll permit the Ontario Forest Industries Association the time, to get the extra half-hour because they know the importance of employment and good forest practices to the people of Ontario." The Ontario lumbermen are fully in agreement with this, and I would be happy to give the Ontario lumbermen, if they want, an hour. We have the time. The idea that we don't have the time is a myth. It makes me quite upset that we won't listen to one of the major players for more than half an hour.
Mr Wood would say: "Gee, some of their members have talked for a little bit of time. We should count that in with theirs." Well, I don't think so. I think we need to deal with the major players for this bill to have any credibility when it gets into the clause-by-clause.
The Vice-Chair: Thank you. Mr Hodgson and Mr Mammoliti, and then I will think we'll take the vote because we're getting very close to 10:30.
Mr Hodgson: I'll just draw the committee's attention back to last week. For those who weren't with us last week, we went to a very nice place called Kapuskasing and we were presented with a representative of Spruce Falls named Kent Virgo, I believe, and Kent was allowed two presentations.
I think a precedent's been set there, and we've also allowed other groups to join after the deadline. We passed a motion just yesterday that allowed two other groups to join after the deadline. This could be treated as another request for an additional half-hour and that would be quite consistent with what we've done in Kapuskasing with a man who wanted to have an hour. We divided it up and called it two half-hour presentations, and it would be consistent with our motion yesterday to try to accommodate everybody who wants to speak before our committee to have an opportunity to do that.
So I'll be supporting this motion because I look at it as another half-hour request, which would make the total one hour for this very important organization.
Mr Bisson: That organization's more important than all the others.
Mr Hodgson: No, it's not.
Interjections.
The Vice-Chair: Order, please. Mr Mammoliti has the floor.
Mr Mammoliti: My point exactly, and I just heard some heckling from Mr Carr. Mr Carr was saying that they'd be prepared to listen to them by themselves if that's what you want, and you've got quite a bit of time on your own time --
Mr Carr: All on the record in Hansard.
The Vice-Chair: Mr Mammoliti has the floor.
Mr Mammoliti: We're all on the record.
Mr Carr: Yes, you don't want --
The Vice-Chair: Mr Carr --
Mr Mammoliti: Through the Chair --
Interjection.
The Vice-Chair: Mr Carr, Mr Mammoliti has the floor.
Mr Mammoliti: Through the Chair, and I think that the point my colleague Mr Bisson makes --
Interjection.
The Vice-Chair: Order, please.
Mr Mammoliti: -- is a good point and we need to remember that indirectly, by saying today that this organization deserves an hour, what I believe we're telling the rest of the grass-roots organizations and the independents and others who have come in front of us is that they're less important than this organization.
Quite frankly, while I know the intention is good perhaps on both sides, the Liberals' and the Conservatives', I think that indirectly that's what we'll be telling the rest of the organizations that have been in front of us and perhaps the ones that want to be in front of us. Again, I'd reiterate that by doing this I think that --
Mr Miclash: Tell us who.
The Vice-Chair: Order. Mr Mammoliti has the floor.
Mr Miclash: Who?
Mr Mammoliti: -- we'd also be setting a precedent in that subcommittees have always dealt with time allocations and --
Mr Brown: We thought we had an agreement yesterday.
The Vice-Chair: Mr Brown.
Mr Mammoliti: Well, you didn't have an agreement. My understanding is that there wasn't an agreement, and it came to the committee and the committee voted on it and now I see another motion in front of us again. That's another point that needs to be brought up: the fact that this is the second motion, and I'm not even sure whether that's in order, Mr Chair.
The Vice-Chair: Thank you.
Mr Mammoliti: But we'll leave it at that and we'll take the vote.
The Vice-Chair: I have consulted with the clerk and he assures me that it is in order. We will now take the vote. I'll read the motion again.
Mr Carr: Make it recorded.
The Vice-Chair: That the committee allocate one hour to the Ontario forest products industry association to make its presentation before our committee in Toronto next week. Recorded vote. All those in favour?
Ayes
Brown, Carr, Hodgson, Miclash, Ramsay.
The Vice-Chair: All those opposed?
Nays
Bisson, Dadamo, Martin, MacKinnon, Mammoliti, Wood.
The Vice-Chair: The motion is lost.
1030
STURGEON TIMBER LTD DORION FIBRETECH LTD
The Vice-Chair: I would like to return now to our regular agenda. The next presenter scheduled for 10:30 is Sturgeon Timber Ltd and Dorion Fibretech, Mr Keith Harris. Please have a seat.
Mr Brown: Mr Chair, just while he's coming to the mike --
Mr Carr: He's already there.
Mr Brown: -- if I can just give you notice of a motion that I will move that Marie Reuter be given half an hour to present to the committee.
The Vice-Chair: If there's an opportunity, a motion is always in order.
Interjection: She's given up her spot.
The Vice-Chair: Mr Harris, you have half an hour, and please leave some time for questions and answers at the end for each caucus. Go right ahead.
Mr Keith Harris: Thank you. First off, I don't intend to go over an hour. All in favour?
Interjections.
Mr Harris: Good morning, ladies and gentlemen. Before I make my comments on Bill 171, I would like to familiarize you with just who I represent and the amount of people I represent and what it is we do.
I'm the vice-president of Sturgeon Timber Ltd and Dorion Fibretech Ltd. These are two companies that are situated in Dorion, about 40 miles east of Thunder Bay. Sturgeon Timber was started in October 1986. It was a takeover of an existing live-in camp operation by Avenor and it employed about 120 personnel. Then, in October 1986, my partner and I bought out the operation and we took it over and we've been the largest contractor for Avenor since then.
We are working on what is called the Black Sturgeon forest management unit. That's located about 50 miles northeast of Thunder Bay. Our operation is out of the bush camp and it's called Camp 45. They number all the camps around here. It's quite familiar to the whole area where this district is.
We employ about 120 unionized people, from mechanics, truck drivers, you name it. It's a 12-months-a-year operation and we produce about 270,000 metres of woodfibre. All of that goes directly to the Avenor mill. In our operations, we are responsible for the planning, the roadbuilding, the harvesting and the regeneration of the allowable cut plan. The planning is done with our own licensed foresters working in conjunction with Avenor Inc forestry personnel and the Ministry of Natural Resources personnel, which we have a very good relationship with, so far.
In one year, our roadbuilding program will consist of about 25 kilometres of class 1 road, about 75 kilometres of class 4 and 5 roads, most of which are maintained year-round. Most of our areas are well used by hunters and fishermen, along with our neighbour who is on the same limits, Canadian Outward Bound Wilderness School.
In our harvesting program, we extract spruce, balsam and poplar to be chipped onsite and sent to the Avenor pulp mill for the making of the news and kraft pulp paper. We also take out quite a large amount of sawlog material and send it to the local sawmills and we also take out the high-quality poplar veneer logs to be sent to the MacMillan Bloedel plywood mill. So in our operation we're feeding off not only Avenor; all the existing mills. Wherever the highest-quality product should go, that's where it goes, and we've been doing that for -- well, I've worked on that limit for 25 years, but we've only owned the operation since 1986.
Our reforestation process begins with scarifying our cut areas as soon as they're harvested so that tree planters can come out the following spring and plant the new trees that are grown in our local tree nursery in Dorion. We have quite a unique situation, because the area we live in has a tree nursery and the people in our little community there, about 800 people, do the harvesting and also the wives and the students, during the summer, do the planting of the trees, back in the same cycle again.
So you can see that our operation is one that creates employment for local residents and also a lot of enjoyable recreation for all the public.
Just about the whole Black Sturgeon management unit block was harvested once before in the 1940s and 1950s, using horses, bucksaws and the river drive method for wood deliveries. So we've gone back now and we're harvesting the same area. In fact, we have employees in our operation who have cut the same stand twice. It's kind of a unique situation because they started, when they were 14 years old, with the old bucksaws and that and it was quite a unique thing to have the guys cut the same tree twice.
A large majority of our stands of timber that we harvest today have grown back naturally -- nothing was planted -- and it's very heavily infested with the spruce budworm, so it's more of a salvage operation. Our average tree age would be 40, 50 years. We have very little of the mature 120-, 160-year-old timber left. What's happening now is that we're trying to salvage everything we can out of it because the whole area is completely becoming dead. It's about 8,000 square kilometres, this Black Sturgeon unit. It's quite a large area.
There was some spraying done back in the 1950s that did help, but since new laws have come into place, there's no more spraying being done and we've lost quite a bit of timber. So we're in a salvage mode there and that's one of the reasons why the chipper's there. You just can't touch the stuff very often. You can't make a sawlog out of it. You can't play with it with the different harvesting equipment. It just breaks up into pieces. The chipping operations are quite effective.
Also, on our Black Sturgeon licence we have a large amount of scientists from Forestry Canada and they're doing extensive research now. This is a 75-year project on the effects of harvesting on the environment. This is quite a unique situation. They're doing it down to the ecosystem, to the budworm and the bugs and you name it.
The Black Sturgeon licence has about 15 years of woodfibre left at the rate that we're going on it. At the present time, there are only two contracting operations working on the Black Sturgeon licence: us and a smaller contractor just out of Thunder Bay here.
Since 1991, we've had two portable chip harvesting machines that chip the full tree at the stump. But, going to portable chippers in the bush, we have been able to gain the fibre utilization of about 15% per hectare. There's no more waste in the branches and the tops are all being utilized right now. This is compared to the old conventional system, where they were bucking it up into pulpwood and there was quite a bit of waste and residue left in the bush. That's our first operation.
Our second operation is Dorion Fibretech. This is strictly a chip plant operation that is situated in Dorion. This operation was started in 1993, when the Avenor mill turned over to chip deliveries for their only fibre requirement. They used to take about 1.4 million cords of roundwood. Now, through modernization, they've gotten rid of the wood-rooms and they've downsized the amount of people in the mill. Production has stayed up. We do all the chipping right in the bush, dump it in the trucks, it comes in and it's dumped right in the digesters. It's about a six-hour time frame right now from the time a tree is cut and it's going to the digester and the newsprint. So it's quite a modern operation.
Because they went to this chip only, a lot of their suppliers were not only large contract operators under the Avenor group; there were a lot of little farmers and jobbers and you name it around the local area who had wood to cut and sell off to private property. Some had crown timber management licences; some had OICs. They were kind of stuck. They had nowhere to get their wood chip now.
At Dorion Fibretech, at the present moment we have about 95 contracts out there. These are all little independents that can't afford to go and buy a three-quarters-of-a-million-dollar chipper to get their woodfibre to the mills. So we purchased a chip plant from BC last year and we set it up down in Dorion. It's an ideal location. It incorporates pretty well all the little jobbers east of Thunder Bay and we do all the chipping for them. We buy the wood from them but it's up to them to get the licences from the crown to get the timber cut. We're strictly just a supplier. Actually, we're just a middleman. It's just a process they're going through to get the wood fibre to the mill. They just pass it through our door and out the other end.
1040
The purchase wood -- we call it "purchase wood" -- is part of the wood that the company used to purchase on its own. Because of union agreements, they were allowed to go out and purchase only 31%. Since then, that's changed somewhat, but they've turned the purchasing over to us, so we go down and deal with all the little jobbers.
Our workforce at the Fibretech plant is about 18. We rely on about another 15 truck drivers to deliver the chips to the mill for 90 different contractors. These wood suppliers consist of jobbers -- that's what we call little private operators. We now cooperate with three native bands that are supplying us, farmers and independent contractors.
Many of these guys have been in business for many years and a lot of them are family operations. They've always sold their wood to different pulp mills in eight-foot form, but because the mills have changed over to wood chips they've been forced to sell their pulp to local chip plants. So far there are only two. There's one east of Thunder Bay and one west of Thunder Bay.
All the woodfibre purchased from these suppliers has already had the veneer and the sawlogs extracted from it. This is very important because we are feeding the local mills with the value products. It's very important also that we allow these contractors to take out the higher-valued woodfibre because it's where most of their profit margins lie, in the sawlog or the veneer. The rest of it for pulpwood has a pretty standard price throughout the northwest.
Our production at the chip plant is about 250,000 metres of poplar chips and about 50,000 metres of conifer chips. Along with Avenor Inc being our biggest customer of wood chips, we also send them our bark. They utilize it as hog fuel to burn in their cogen plants. Kimberly-Clark of Canada in Terrace Bay also takes some of our fuel.
There's a lot of talk now about generated waste. Domtar in Red Rock is talking about possibly a cogen. Our local tree nursery is looking about putting in a small cogen from Finland. That's going to be quite unique, because the trees that are harvested, the bark will be put back into the cogen plant to create hydro and heat to generate the new trees that grow right back on the same tree site again. It's quite a cycle we're going to have going there.
To service both Sturgeon Timber Ltd and Dorion Fibretech, we also built a large service garage. We do a lot of repairs to all the public and our own equipment. We employ about seven mechanics in that garage on a full-time basis.
By passing this Bill 171, we feel that our operations will be put in great jeopardy. Did you all receive the handout? I'm going to get to that in a minute. That's the mainstay of our discussion.
What we need is a guaranteed fibre supply annually to keep us operating. With our two operations it's kind of a difficult situation because the Sturgeon Timber group is under the Avenor blanket right now and Fibretech is a separate issue that works off the crown management units. Avenor looks after the licensing of the limits. We must maintain a guaranteed fibre source to our operations because we have a guaranteed market.
With Fibretech we've got a 10-year agreement signed with Avenor for chips, as many as we can produce, and our capacity is 300,000 metres. It must be made clear that the announcement of surplus hardwood timber, whoever's going to decide that, not interfere with the existing operations that are running efficiently right now. Without the guarantee of a long-term wood supply for our operations, it will make it very hard to deal with the banks if we need capital dollars for expansion and modernization. Having a mill licence for only one year will not make for a very secure operation.
On these chippers, one of the recommendations in Bill 171 was to license whole-tree chippers. First off, there's a misconception in the word there because a professor of forestry pointed out to us that these are not full-tree chippers. They don't take the full tree. The stump is still there; it's just the stump up. This is a point that came up in last week's review here.
One of the things about these chippers over a sawmill chipper is the quality. There's been a lot of extensive research done, and development. It's a very broad field right now, chippers, because all the mills are turning over to that. The chips coming out of a full-tree chipper or a total-tree chipper are quite superior to those of a sawmill chipper. The sawmill chips, mainly from the slab of a sawlog, contain the knots, any bark left on and the exterior of the tree. The chips from a sawmill are not recommended for the process in the paper industry.
In today's competitive pulp and paper market it is of the utmost importance that high-quality woodfibre be used to ensure good dollar for your product. We feel very threatened by woodfibre supply management, which will control the supply and the price, whether it be the sawmills having the option to make lumber or to make chips. Right now, we have sawlog material going through sawmills strictly for chipping. Or will it be the government having the right to issue mill licences or not to issue them? Could sawmills have a monopoly on the woodfibre? We're going to get to that in a minute.
We feel that there would be lack of flexibility to react to the market demands. What I mean by market demands is that when we went to chips in the mills they no longer had a large inventory of roundwood at their disposal. Today, if the mill goes on to hardwood craft, they run over to the hardwood pile and grab that wood. That's not there any more. They've got three chip piles -- one's poplar, one's spruce and one's jack pine -- and they can gobble those up very, very quickly.
What happens now is that in the bush and at the chip plants we are the ones who have to do the running around very quickly. If they want poplar kraft, we've got to move everything and go find it. We need that flexibility to react. They don't know what the markets are until a month ahead of time.
Controls imposed by the regulations of the mill licences subject us to possible loss of licence if we have substantial changes in volume or product type during the year. We will be penalized for trying to be more efficient or meet the new market demands. Also, the minister would decide whether or not the business could be sold. If you have no licence, you have no sale for your company. That's always been the last resort of the businessman, that if worst comes to worst you can sell off your assets. Without a mill licence you'd be up a creek, I think.
In closing, I would suggest that the whole-tree chippers for chip plants be exempt from having to have a mill licence so long as the wood flow is charted by the customer with a central scale agreement with the MNR, since chipping is just another element in preparing the woodfibre for the mill process and making a finished product.
I urge you greatly to do what you can to help maintain the economic growth in the rural areas where forestry has always been a way of life for many years and not let larger companies monopolize the markets at hand. The pulp mills, being the mother of all markets, must maintain a diversified woodfibre supply in order to guarantee survival in our changing and competitive manufacturing world.
The mainstay -- it's not an hour speech -- is the sustainability of the forest and the social values of Bill 171. One thing that's started already is that just last year when Howard Hampton, the minister, announced the surplus of hardwood fibre in the northwest. When we saw the studies that the ministry had done, we were very disturbed to find out that the Black Sturgeon licence was included as surplus. I've operated there for 25 years and I've been to every corner of the limit. According to the volumes, they had 884,000 metres of excess fibre. We sure as hell haven't found it.
With that, I guess, with job creation, whether it be the election coming up or whatever, but --
Mr Brown: Oh, say it's not so.
Mr Harris: Well, say it's not so, but --
Mr Mammoliti: It's a long way away yet.
Mr Harris: Whatever. He had set people loose on what they call surplus fibre. This handout I've got here is just the beginning of what we see could happen with mill licensing. If they offer this sawmill operator the mill licence he's after, it's going to put hundreds of people out of work.
1050
If you go on to page 2 of your handout, this is already in the midst, so I presume this fellow already has his licence. He's started to put in equipment already. You see down at the bottom of the page, or in the middle of the page, under item number 1, it says, "The MNR has conditionally committed poplar and white birch volumes from 11 management units." The 11 different management units are from Sioux Lookout to White River. It takes in pretty well the whole northwest.
If you go down to item 2 there, towards the bottom, "Minister has committed 622,500 metres" of hardwood annually to this operation. All right? That's just hardwood. In order to commit 622,000 metres of hardwood, there has to be about a 30% recovery of softwoods in those stands. In essence, he's going to be committed to about almost a million metres annually for a mill that hasn't started up yet.
Out of that, in the hardwood only, 187,000 metres is going to be used in the sawmill. This is what they're saying: It's going to be job creation and hardwood lumber. If you use your mathematics, there's a large amount of waste that's coming out of the 622,000 metres and there's only thing that can be done to it. That's chipped and fed somewhere. There's nowhere in the States that'll take it because we're too far away from any markets down there.
But by doing this, this operation is going to have complete control of the hardwood chip market in northwestern Ontario, because even out of the 187,000 for sawlogs, about 30% of that is going to become chips; 70% will become lumber, if that's ideal.
Also, up on page 3, at the very top there, where a lot of our suppliers make their profit in their operation is in the plywood. That's a very highly specialized product, making plywood hockey stick handles and you name it, and it's a very high dollar. For instance, poplar pulp right now at our plant in the local area will go for roughly $65 a cord or $27.50 a metre, where plywood will go anywhere from $90 to $110. They'll go as far as Fort Frances to pick up plywood for $160 a cord, just for the quality of it.
If this local sawmill operator gets this, he's going to supply 100% of the veneer for this mill. Again, all these jobs -- this is just our area -- these 270 families that we support will be wiped out. There are offers to bring tree length in from Sioux Lookout to White River and do all the sawing and merchandising here, which is a very economical way to do things, except we're very afraid of the leftovers. Three quarters of this guy's timber supply has to be chipped and the markets right now are captive, they're very full. Avenor can't handle any more. If this guy come on stream, what he's actually going to do is replace existing operations with a one-man show. This is why we're quite concerned with the mill licensing. It's just an example that's started already. They could put a lot of people out of work and we're hoping that will not happen.
If you go to the very back page, it'll tell you the crown management units, Nipigon and Thunder Bay and all the other management units that are under forest agreements right now with different companies, that the government has just committed 620,000 metres from. He's been in the area a long time. He's a very smart operator. He's a very large operator. He owns seven sawmills in the northwest. But the very thing we can't allow to happen is for somebody to monopolize the whole gamut. It'll put a lot of union men out of work. The natives are just starting to get into it now. They've got some very economical operations running and we've got meetings with them again tomorrow. They're going to start supplying us with a lot of fibre off their lands.
But one of the things that he has -- on the third-last page -- on licensing -- and he's got this right now; this is one of the things that is a problem with the act -- is a first right of refusal. A lot of our operators are just small guys; they might cut 2,000 cords a year. But this is always hanging over their heads, where they can't sell their product where they want to because he's already got the first right of refusal on sawlogs.
We designed our chip plant, for instance, to take 16-foot because of the fact it's more efficient, less gaps, easier to handle, less slashing in the bush, less steps you're going through. It's cheaper all the way around. But because these jobbers are working on district cutting licences, DCLs, from the crown, the sawmills have the first right of refusal, so those logs have to go to that mill unless we can beat the mill's price. Then it just becomes a price war. You'll see under licensing he's also gone for first right of refusal on the poplar and white birch sawlogs. In essence, we won't be able to buy any more wood from any of the crown management units.
It's an example right there of the licensing that has taken place. Maybe they've jumped the gun on the act, I don't know, but that's our very big concern right now, the sustainability of the forest. I've worked on that limit for 25 years. If he says there's 884,000 metres of poplar there, I'd like to know where it is, because right now we're down to 40- and 50-year-old stands of harvesting, and that's strictly just to regenerate it back into a better work site. They come back naturally. It's just thick and it's not growing very fast and the budworms are into it. So we harvest it, we scarify it, we'll plant good, healthy trees back in there and then we'll have a good forest. But as I say, I'm very doubtful that this surplus hardwood is available. Short-term possibly, but that 622,000 metres is more than Avenor, MacBlo and Abitibi use annually.
The Acting Chair (Mr David Ramsay): Thank you very much, Mr Harris, for your presentation. There's just a minute left for each caucus, I suppose, to make a statement or a very short question, but there's just a minute each since you've taken up 27 minutes of your time. But it was a very good presentation.
Mr Bisson: I just want to say thank you very much for your presentation. I thought it was informative. We've heard a lot, especially in the northwest, about the whole question of chipping. I really question where in your presentation you're talking about, "We're chipping stands of timber that are 40 years old," from what I understand. I really wonder. The whole idea is that what we have to do for the industry is that we need to make sure that there's a sustainable flow of the wood to be able to support the investment and mills and the paper mills and all of that industry. I understand the predicament that you find yourself in with regard to chipping facilities, but I really wonder if that's the best end-use approach that we should be taking when it comes to the utilization of the forest.
I certainly would like to have a little bit more time. Maybe afterwards we can have a bit of a chat and get specifically into things, but I don't know -- we've heard different things. We've heard some people talk to us about chippers, that nothing goes in bigger than four-inch; we've heard it going as high as 23-inch. If we're chipping logs that are 23 inches in size, that is not a good use of the fibres. I think what we need to do is have a policy that says we need to make sure that the sawmills are able to be supplied and the excess chips go over to the mills. But we'll talk about it later.
The Acting Chair: Mr Harris, I'm sorry, we won't have time. We just have a minute each. The committee just voted on another motion not allowing presenters more than 30 minutes, so I'll have to adhere to the committee's wishes. Mr Brown, one minute, please.
Mr Brown: You have raised, I think, an issue that we have been trying to grapple with for some time. That basically is, what process does the crown go through to determine surplus and then how do you allocate the surplus, if in fact there is one? We are told it will be by competitive bid. However, we are not told what criteria there are for the competitive bid. We find this to be a total mystery. We're glad you brought this to our attention and certainly we'll be looking at these licensing questions very carefully.
Mr Hodgson: Thank you for your presentation. I just have a follow-up to Mr Brown's, actually; it's related. There have been a number of announcements that have received a lot of press play on our trip through northern Ontario. That's all the jobs and the investment. We were in Fort Frances the other day and they were suggesting $100 million. But the surplus hasn't been identified yet. Do you think it would have been wise to wait until you know about the surplus before you make the announcement?
Mr Harris: I think it's very wise, because somebody should do their homework.
Mr Bisson: The surplus has been identified.
Mr Hodgson: It hasn't been identified, Mr Bisson.
Mr Harris: I've talked to MNR personnel who were involved in doing the study, and they've all said that is not there; the hardwood surplus is not available.
The Acting Chair: Thank you, Mr Harris. We really enjoyed your presentation. It was very informative and we'll certainly be considering that in our deliberations.
1100
KIASHKE RIVER NATIVE DEVELOPMENT INC
Mr Tim Esquega: Good morning. My name is Tim Esquega, and I am the president of Kiashke River Native Development Inc. This company is based at Gull Bay, a native community on the west shore of Lake Nipigon, approximately 200 kilometres north of Thunder Bay. Since 1974, for 20 years, I have conducted harvesting operations, silviculture operations, in the Kiashke unit. This small company management unit, only 90 square kilometres in size, is located approximately 20 kilometres north of Gull Bay. The intent of the Kiashke unit is to provide both employment and economic opportunities for the residents of the community of Gull Bay.
We were a form of community forest long before the term "community forest" was used in the Ministry of Natural Resources. Our continued existence 20 years later is proof of our business success. The company is independent in that the timber harvest is not obligated to be sold to any particular sawmill or pulp mill. I have the freedom to sell woodfibre or other products to open markets. This flexibility has contributed at times to my business success, and at other times has caused anxious moments. It has been essential for me to understand market conditions, be aware of costs, product activity and product quality. While ensuring that the company is a business success, I also have followed sound forest management practices and regulations set out in the legislation. The Kiashke management unit has been recognized by many groups as a model of good forestry management.
From 1974 until 1991, the company was labour-intense, using men with power saws and cable skidders to harvest timber. During this time, the company sold roundwood to sawmills, pulp mills and veneer mills in the Thunder Bay area. In 1991-92, factors were affecting the success of the company. The labour-intense operation was extremely costly due to the high WCB expense. The company has not kept up with the improved harvesting technology over the years. For the sake of keeping jobs for the people of Gull Bay, in order to produce a cost-efficient product to sell on the open market, changes have occurred in the harvesting operation.
Secondly, after discussions with wood purchasers in Thunder Bay, it became obvious that the most attractive product form would be wood chips. Not only was there a great opportunity to increase profits, but also the chance to secure a long-term commitment for sales of timber. I purchased a mobile full-tree chipper in the spring of 1992, which has assured the long-term business success of the company. The community of Gull Bay will continue to receive employment and economic benefits.
As a native person, I have been affected by provincial legislation, with impacts upon my lifestyle, particularly as related to hunting and fishing. Now as a businessman I believe I will be affected by the legislation proposed as Bill 171. Kiashke must perform all the forest management functions that large companies perform but with a much smaller timber volume base. Area charges since the recent amendment are very costly. The cost of preparing a forest management plan as a condition of the forest resource licence is expensive. The proposed penalty assessment structures would wipe out the financial resources of the company even for one mistake. There are no rewards for practising good forest management on a small company licence. There appears to be some incentive to remain as a small, independent businessman.
Also, as a mobile full-tree chipper owner, that Bill 171 requires for the forest resource proceedings a facilities licence for the field chipper is a serious concern. The committee has already heard much discussion about the subject. As an independent logging contractor, I have survived for 20 years selling timber harvested from Kiashke unit on the open market. This regulation could impact on my company's ability to succeed. I do not think the government should be directing where and how I sell timber produced on Kiashke unit. Based upon my experience and understanding of the local markets, I have chosen a harvesting system utilizing the latest technology that allows the company to succeed and continue to provide benefits to the community of Gull Bay.
I thank you for this opportunity to make this presentation.
I also have a feeling, a very strong feeling, getting into the mobile chipping business was to perfect a chip that the companies need. Now I hear that the sawmills have a first priority on chip quality over our chipper. The thing is it seems to me that I spend a lot of money to perfect a chip to the open market. Now it comes to a point that I'm on the bottom of the totem pole on my chip quality, and the sawmill has the first priority on chips, and they're in the business of making lumber. We're in the business of making chips and lumber.
But these are the things that really concern me. In our community we've been talking about Indian self-government for many years. I think, you know, there's suppression with all policies that are being made upon us. We cannot survive under the conditions that are in front of us here. We are a very proud people. We don't want to live on welfare. We want to succeed in our logging operations, but it seems very, very difficult to just maintain a logging operation in our area with all these policies that are being changed. Maybe the logging operation down east is totally different from the northern areas. We seem to be used as the eastern part of Ontario, to try to use that same system in the northern part, and we're not sawmill owners. We're just barely surviving. I haven't finished paying for my machinery.
The one-year thing is another thing that's really bothering us. There's people buying chip trailers and they can't go into a bank and say, "We want to get into hauling chips" for our company, because we've got only a one-year licence. We don't have any long-term goal that we used to use, let's say around five years: We'll be in operation five years. Today we don't know if we're going to be in operation next year. The financing companies don't look at you if you've got a one-year. If you're buying a half-million dollar machine, they won't even look at you or even talk to you if you've only got a one-year commitment on logging.
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The thing with chip marketing -- I thought the government would be able to look at the underdog and try to help out the community people, the grass-roots people who are working under our companies, to kind of help out the smaller guys. Instead, they're interfering with our business entrepreneurship, to be able to exercise our knowhow in our own business. I've been logging all my life pretty well and I want to continue logging. I've worked hard to have something for my family. When I retire, I'd like to have my company turned over to my family, but that's out of the question now with the regulations that they have.
I've worked for nothing all my life, and it's not fair. I've worked to provide employment for my community people, for my family, for them to take over, to continue doing what I've been doing. But that's not the case with the regulations that are in front of me here. So it's a big blow to native people. I have, as an individual, wanted to employ or even start other operations in other bands and help them to get going in the logging business, but it looks very bleak today of ever starting another native operation anywhere up in the northern country.
Those are the things I wanted to bring out.
The Acting Chair: Thank you very much, Mr Esquega. Does the other person at the table want to make a presentation?
Mr Geoff Pattyson: I'm here to provide support for Tim.
The Acting Chair: Thank you very much. Maybe just for the record, you could identify yourself today.
Mr Pattyson: My name is Geoff Pattyson and I do forestry work for both Kiashke and the other company that Tim owns.
The Acting Chair: Thanks, Mr Pattyson. That will give us about 17 minutes altogether, so we would start with Mr Brown.
Mr Brown: Meegwetch. Thank you very much for this presentation. I think it's very important from a number of standpoints: first from the standpoint of your communities that you represent, and secondly, we're back to that issue of chippers and the licensing thereof.
I just need some things clarified. I'm getting confused on this issue. If your chipper, same machine, was sitting at the Avenor mill, in their yard, would it require a licence, in your view?
Mr Pattyson: If Tim is the individual owner of that particular piece of machinery, under our understanding of the proposed change to the legislation, yes, he would have to have his own particular licence because he is the individual owner of that piece of equipment.
Mr Brown: I guess we shouldn't speak specifically, but if a private individual or private company had leased on a long-term basis the machine to Avenor and it was sitting in Avenor's yard, would it require a licence, in your view?
Mr Pattyson: I would suspect that it would be covered under a mill licence issued to Avenor.
Mr Brown: That's what I suspect, too. If Avenor owned the chipper and it had it in the bush, rather than in its own yard, would it therefore require a licence under this act, in your view?
Mr Pattyson: I think that is a grey area. That is not clear.
Mr Brown: I'm having real difficulty. If the issue from the ministry's standpoint is best end use of the wood, if that's what this is about, then that can be described in the various licences that are given out. Wouldn't you agree?
Mr Pattyson: I would think so, yes. It would be covered in the forest resource licence rather than in the processing facility licence.
Mr Brown: So best end use couldn't be an issue, because that would be described in the licence that was given under the forest resource licence.
Mr Pattyson: That possibility would exist, yes.
Mr Brown: Then if it isn't about end use, best end use, I'm having difficulty here seeing -- this is obviously a very intermediary step. It is not a manufactured product; it is just an intermediary step to take the wood somewhere. Why the licences are going to be required of a private individual or a private company, where if it's the same machine owned by the same person but leased to the finished product company, Avenor in this case, sitting in their yard wouldn't require the licence -- I'm as confused as you are about this particular regulation, or definition, I guess. I don't see how it all adds up. I don't know. I guess I'm sorely as confused as you are at this point about why this is being put. Have you any idea what the reason for this might be?
Mr Pattyson: First of all, I would suspect that your confusion is also similar to all the other people who have been up here making the presentation that they are confused and that's why they're here making these presentations, hoping for some type of clarification. Just a comment on the best end use: How do you determine best end use? Is it simply the particular product that can be made out of it? In Mr Esquega's case he is selling his fibre on the open market. His best end use is that which will provide the greatest profit margin, but that may not fit other particular situations.
Mr Brown: I understand and I'm wrestling with that issue too. I understand what you're saying. The first part just confuses me all to heck.
Mr Hodgson: Thank you for your presentation. So you feel the passing of Bill 171 will force you out of business the way it's presently written?
Mr Esquega: I feel that way. It's very unpredictable. I don't know what's coming up and I don't know how to -- changes scare the hell out of me, and the idea of all the suppressions we're getting at our community level. It's one suppression after another, you know, and we've got to have a licence for everything, what we do and what we used to do as aboriginal people. The way of our life is suppressed with policies that we have to have a licence to get everything now. We've got to have a licence to hunt. We got to go to a course for getting a licence for a shotgun or something like that. We're suppressed with all kinds of different policies, and we just exist in our communities now and there's nothing we can do. We cannot hunt without a licence. We cannot drive without a licence. You cannot go hunting without a licence. You cannot get bullets for your gun without a licence. We're suppressed to all kinds of different policies. We've got to go to a trapper's course to go trapping, and we've been trapping all our lives. So these are the kind of things that I feel about this change here.
Mr Hodgson: Yes, I think there are a lot of us that are tired of that and want change. In the interests of brevity, I'll turn my time over to the other party. Thank you for your presentation and bringing us your concerns.
Mr Bisson: Thank you very much. I appreciate your presentation. I detect in your presentation what you were alluding to is that there's a whole sort of notion of uncertainty in regard to how you view the bill.
I'd like to just clarify a couple of things because I think for the record they need to be straightened out a bit. First of all, when we talk about licences, I don't think most people are aware, but a paper mill has a licence that's issued every year and renewed every year. That's been the practice in the province and has been the practice in the country for years, that licences are issued every year according to compliance and making sure they live up to the conditions set out when they built their mill. What's intended in the legislation is not so much to encumber, but more to reflect what really is the common practice within the province.
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Anyway, the issue that people have brought to this committee is, should we be licensing mobile equipment? I think that's a separate issue and that's something the committee is prepared to look at. But just to put it clearer, Kimberly-Clark and Malette lumber and Abitibi-Price in Iroquois Falls, all of them have licences that are for one year and renewed. Banks are lending money and have been lending money for these institutions in the hundreds of millions of dollars for a long time on one-year licences, so I think we need to put that clear.
The other thing is that you talked about the penalties. To clarify the question of penalties, you don't jump from an offence within the Crown Timber Act presently or under the new sustainable forestry act, directly from, "You have an offence," to, "Do you know that you have an infraction?" and you jump automatically to an administrative penalty or an offence under section 61 of the act.
The way the act is written, it says, first of all, that we recognize within government -- I think all legislators from all political parties and the Ministry of Natural Resources and the public, to a certain extent -- recognize that the majority of operators in the bush have been doing a damned good job over a period of years. We've been learning. It's been an evolving process. We've learned how to better harvest, we've learned how to better manage and we've learned how to better reforest our forests and take care of them over the years; that because of legislation that was started under the Tories some years ago, carried on -- well, tried to get kicked off with the Liberals. They didn't want to do it, so we're here with this legislation today.
Industry and operators have been learning how to do their jobs a lot better, and we're sort of in an evolving process about just how good and just how expensive it gets as well, because the more we learn and the better we do the job, the more it costs us. If you look at the cost of reforestation 30 years ago, it wasn't very expensive compared to what it is today, in 1994. I'm sure that in 2010 it's going to cost more money, based on the fact that we learn how to do it better and we start to take into account other things, and that's what this act is trying to do.
So the way the offences go is that if somebody does an infraction, the first thing that is recognized is that sometimes those things happen and it's not by choice. There's an error that's made, you start cutting a little bit outside of where you should be or you don't cross a stream in the right way, and you would be asked to repair the damage.
Only in cases where people say, "No, I refuse to do what the regulations set out to do," then you may end up into an administrative penalty. But only in cases where there's a flagrant abuse of somebody who says, "No way, I'm not listening to the bill. I'm going to go out and I'm going to harvest in an unsustainable way. I'm going to knowingly go out and damage the forest," only there you would get into offences under section 61 of the act. So it's not intended to go directly to that. I guess what I would suggest from what I hear through people making presentations is maybe we need to clarify how you go from section 53 to 54 to 61 a little bit more clearly.
Now we get to the questions. In regard to preparing their management plans, the forest that you cut on now, are you cutting on an order-in-council licence?
Mr Pattyson: Yes.
Mr Bisson: So you have an order in council. So you're the only operators on that order-in-council licence. All right.
What you're saying is that now, under this act, we're going to have to prepare a forest management plan that looks at the ecosystem and that's going to cost us a little bit more money and we're afraid of what the cost of that is going to be, basically. Is that what you're sort of saying?
Mr Pattyson: I think it was a comparison relative to what the large multinationals, if you want to call Avenor, Abitibi-Price -- what their capabilities are, what their resources are with a fairly substantial volume. Mr Esquega's companies have to meet those same requirements with a much smaller volume base to work on.
Mr Bisson: Just for you to know, there is the opportunity within the legislation that if you don't have the expertise within your organization to be able to prepare forest management plans, the ministry or others can act in a consultative method, or you can ask that the ministry does that for you, at which point you would be probably charged back, if you have an order in council, the cost of doing that. But the cost of the work being done would be drawn from the trust fund.
I guess what the bill does is that it puts a certainty that the money is there to do the work, first of all, to prepare the land and then to go out and do the actual work in regard to reforestation. Have I still got a few minutes?
The Acting Chair: Yes, you do.
Mr Bisson: The thing we have to look at as a committee is, how do we deal with order-in-council licences? Because, clearly, people who presently have FMAs today in orders in council are in a bit of a different class, and I guess we need to look at that a little bit more clearly.
The other thing is what I really want to get, because your presentation and the other presentation touched the same thing, and that's the question of best end use. Where do you get the notion that all of a sudden you're going to be told that you have to sell your lumber to a certain mill? Because there's nothing in the legislation that says that.
Mr Pattyson: The requirements of the forest resource facility licence are for a business plan and a wood supply analysis to occur.
Mr Bisson: But that's an economic factor. If I go out and borrow money in order to set up a forest resource plant, I have to have somebody to sell my product to.
Mr Pattyson: Okay. Mr Esquega's situation is he has no affiliation whatsoever to any particular company, so he's been selling his wood on the open market now for 20 years. He has made those same judgements that you are now saying are basically required. Why does it have to be duplicated?
Mr Bisson: What has to be duplicated?
Mr Pattyson: This wood supply analysis and this preparation of a business plan.
Mr Bisson: But the comment that you were making in your presentation and that I think the former gentleman was making is that you would be told where you can sell your product, to which mill. Is that what you're saying?
Mr Pattyson: That was based on information and discussions with MNR officials, who have basically said that the overall intent of making this licensing structure is to manage and control the direction of wood flow.
Mr Bisson: No, it's more to manage how we approach the harvesting practices. There's another exercise that's happened within the ministry for some time, talking about best end use. I'm wondering if what's happening is that people are looking at the best-end-use discussion and lumping it in with 171. Maybe we should be doing that. I heard a presentation here the other day where somebody was saying they were chipping 23-inch sawlogs.
Mr Pattyson: I made that statement.
Mr Bisson: Was it you who made that?
Mr Pattyson: Yes.
Mr Bisson: I'll tell you, I've got a whole bunch of sawmills in my area that would go absolutely nuts with that.
Mr Pattyson: That comes to my comment that I made to Mr Brown as far as best end use. If that contractor's best end use is greater profits, in that particular situation the best end use was to make it into chips, because that was where the greatest profit margin lay.
Mr Bisson: So then that would be developing a sustainable policy based on the economics. Is that necessarily what's the best for the forest, though, and for the socioeconomic impact on communities?
Mr Pattyson: The forest resources plans will dictate what is the best for the forest. The market will determine what is best for the markets that are produced from the forest.
Mr Bisson: Which is another discussion outside of this bill with regard to best end use. I'm out of Timmins, and the argument we all have is that, for an example, there are not enough sawlogs to go around at times, especially for, as you say, the smaller, independent operators who have smaller mills and who don't have tenure to an FMA. Where do they get their wood? The only way they can rely on that is through the right of first refusal on crown units or excess wood they may be able to get through this legislation on an FMA.
Those operators come to me and say, "Jeez, Gilles, they're chipping logs that are 23 inches in diameter," and I'm saying, "No, it can't be." Then I come to Thunder Bay and find out it is so. Maybe we should be talking about best end use.
Mr Pattyson: Mr Esquega alluded to the differences between northeastern Ontario and northwestern Ontario. I think your situation, where you have multiple individual owners in northeastern Ontario, it would be a very competitive market situation and obviously that 23-inch tree is going to be very valuable to those particular sawmills. However, in northwestern Ontario it's basically a monopoly. The price that is paid for sawlogs generated in the woods is restrictive.
The Acting Chair: Thank you very much, and thank you, Mr Bisson. I suspect you're going to have further opportunity to engage with these presenters as we call up the next company. It happens to be the very same presenters who are going to make representation on behalf of Niigaani Enterprises Inc.
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NIIGAANI ENTERPRISES INC
The Acting Chair: Mr Esquega, you're noted here as the presenter, and you can proceed any time you wish.
Mr Esquega: I want to thank the committee for the opportunity to make this additional presentation. Kiashke is a separate entity to its own licence. The Niigaani Enterprises, of which I am the owner, operates on a third-party licence with Avenor, Abitibi and the prime licensee. These areas are immediately adjacent to Kiashke management unit.
Niigaani Enterprises Inc has been in existence since the mid-1980s, when both Avenor and Abitibi recognized that a successful operation was already occurring in the vicinity of Gull Bay and it would be mutually beneficial for the prime licensee of the community of Gull Bay to enter a third-party agreement.
Both of these agreement areas are in a forest management agreement forest, so Niigaani not only harvests timber but is responsible for silviculture, such as site preparation and tree planting. Niigaani, like Kiashke, is committed to overall good forest management practices.
There is a close relationship between Kiashke and Niigaani in both harvesting and silviculture operations, shared equipment and management. This shared agreement allows both companies to produce the cost-effective product that neither company could do by itself.
The success of each company and the ability to provide benefits to the community of Gull Bay are all closely related. Niigaani Enterprises Inc obviously is also concerned with any part of Bill 171 that will impact upon the company's ability to be successful.
Niigaani also has a concern dealing with the forest resources proceeding facility licence. A full-tree chipper increases utilization of fibre on a yield-per-square-hectare basis, provides a fibre product with greater profit margin than a roundwood product form, a superior product of the activity for the sale to pulp mills.
The marketplace has allowed Niigaani and Kiashke to be successful. No further controls should be placed upon the sale of timber products derived from the harvesting operations.
That's all. Thank you.
The Acting Chair: Thank you very much, Mr Esquega. We will then start with the Progressive Conservative caucus, and I'll recognize Mr Carr.
Mr Carr: Thank you very much for your presentation. As you know, as we get a little closer, there is going to be some clause-by-clause. When people get a chance to really go through some of the details, we're hoping that they will present us with an update, because a lot of people haven't had a chance to go through it. Hopefully, you'll be able to do that as well. I know it's difficult to follow what's going on in Toronto with the bill, and with your daily operation it's tough to spend the time, but it is going to affect you a great deal, so hopefully you would do that.
But I've asked this question to numerous people as we've gone right across this province. We heard from some of the big players, Avenor and Spruce Falls Inc, that said to me they suggest I vote against this bill in its present form. I want to tell you that what I have done when we met with the minister up in his riding of Fort Frances is I took the conclusion page from a couple of the presentations and said, "This bill is bad; don't pass it," and I told him exactly who the companies were.
The reason I did that is the staff -- and people from the ministry are very nice people; we travel together, but I don't know them and I don't how much the minister is hearing about this bill. I want to tell you that I personally handed it to him and told him that the two largest employers -- I guess the other one was E.B. Eddy; I handed him their presentation -- said, "Don't pass this bill."
I did that not to be political in front of everybody and to make a big show of it, but I wanted him to know, because I don't know what the staff is telling him. He needs to know very clearly that in this case the three largest employers in those communities said, "This bill's bad; don't pass it."
I would have included some of the smaller players as well, but knowing how busy he is, I didn't know if he'd get a chance to read it. I underlined it. They were very powerful presentations. They said, "The bill's bad; there are major flaws in it; don't pass it."
So I want you to know that, that the minister, who is not only a minister but also comes from a community that's highly dependent on it -- and boys, you gave us a good tour -- knows very clearly that the major players in this province do not like his bill. I want you to know that because often what goes on with Hansard and so on, sometimes the minister doesn't know. This won't slip through the crack. As a matter of fact, the conclusions were so small, very short and sweet and to the point, that he actually read them in front of me. So I want you to know that: The minister knows very clearly that the people in this province, the major players, do not like this bill.
What he does with that, I told him very clearly, is up to him, and how they're going to make the amendments and what changes they're going to make is going to be very difficult. But I can assure you if major changes are not made, I won't be voting for this bill. The problem is, of course, that I'm only one of 129 and have a very small voice in all this. But I want your assessment of what you would like to tell the minister before he proceeds with clause-by-clause.
Again, what I will attempt to do is give that to him. I may not see him until October 31 now, but I certainly would put together in a letter form some of the comments. If you could sort of, very short and sweet, tell the minister something, as this will affect you a great deal, what would you like to tell him?
Mr Esquega: The thing I feel about this whole rigmarole here -- I don't know, everybody seems to be confused of what we're talking about. It's a high-profile type of thing and I'm just a simple person. I don't quite understand what the changes are, how it's going to impact on our operation. Those are the scary things, and some of the people who are talking here are not quite sure of what they're talking about. They're confused, I'm confused, and when it comes to that point, it's scary as hell.
The changes that are coming on in the future are going to have a very strong impact. Our operation has 25 or 30 people working 10 months a year. That's in jeopardy and these are the things that I'm concerned about. What protection do we have over bigger companies? The bigger companies are listened to; the smaller guys are pushed away. Those are the things that scare the hell out of me.
If I was talking to the minister, these are the things I'd tell him: the concerns of our future, the concerns of the people who are working, the families that our company supports in the future, within the 20 years that we've been in operation. Those are the ones that I feel responsible for. They've got families, they've got children. Those are the things that are scary.
I can't seem to pinpoint exactly what I would tell him directly, but those are the feelings. It's an overall kind of scary feeling that I have in my own country. I feel very suppressed in my own country and I can't seem to grow. I am a proud man. I want to be a success in my livelihood. I don't want to be -- what do you call it? -- a burden to my country. I want to be part of the success of my country, and I think I've got a right, a full right as an individual, to have that kind of feeling. There's a lot of people out there who have tried and been suppressed by other policies that have a stranglehold on people to succeed in their own country.
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These are the things that really bother the hell out of me. It's my country; I'm an aboriginal person. I'm being controlled to a point that I cannot move. I'm suppressed and, you know, we can't live on welfare. We've got to be able to go out there and exercise being able to be self-governing in some way or some fashion. But what all these other policies -- that can really have a stranglehold on our own development as native people. I want to speak from the heart. I want to talk about my way of -- we've operated, we did everything within the management way of doing things in our operation. We plant over 700,000 trees yearly. It's a big spinoff of people that are involved in our operation.
I can't seem to pinpoint the question I would tell the minister, but it's a whole lot of different things and it would take not only a question, but it would take a book, I guess, to explain everything about how --
Mr Carr: Thank you very much. Just listening to you, I appreciate you coming in. It's people like you that I think have built this great province, and continued luck and success.
Mr Wood: Thank you very much for coming forward with your presentation under two different companies and your concern about Bill 171. I just want to go back a little bit. I understand that you're operating on crown land, so to a certain degree -- and supplying to Avenor?
Mr Esquega: Yes.
Mr Wood: And your business relationship is with Avenor to supply basically chips to their operation in Thunder Bay or Dryden?
Mr Esquega: Yes.
Mr Wood: Okay.
Mr Esquega: I used to sell logs to all different companies, and log material.
Mr Wood: Okay.
Mr Esquega: With Abitibi, Northern Wood.
Mr Wood: Okay. There's no doubt in anybody's mind that the technology that is there -- having moved to Kapuskasing in 1959 and seen the horse operations in the woods going to small tractors, to skidders, to sawmills being shut down, modern sawmills being built, the chip and saw operations and now in the northwest to more chipping operations.
I've spent most of my life before being elected in the forestry business at Spruce Falls, and there were some comments, I guess it was from one of the previous presenters, on the quality of chips versus chipping whole logs compared to chip and saw operations where you sell one by twos, one by threes, one by fives, one by sixes. I'm well aware, depending on which operation and who you talk to -- if you talk to Spruce Falls you get one story from the chemical engineers who are responsible for the finished product to other companies and there's no doubt that there's some concern. But what I want to know is, we heard a presenter before saying he's representing 118 different independent logging operations and he doesn't see Bill 171 affecting them as far as cost, as far as manpower -- he doesn't see any effect on it whatsoever. Yet we're hearing now that there is a concern, security of employment later come down the road.
I guess it's not clear in my mind -- you have a business relationship with Avenor, which used to be Great Lakes Paper before -- how the employment is going to affect -- they're still going to want to produce paper on their paper machines and they're going to need the chips. They're going to need the roundwood.
Best end use: Some people are telling me that best end use -- we talked to Boise Cascade, which is now Rainy River Forest Products, saying their best end use is putting four-foot logs into the groundwood mill to produce a filler for the sheet. Other people are saying best end use is chipping the whole log.
I'm well aware of the operation from the ground right to the finished product going out but I fail to understand where you're saying that the fear is there, because other people are not saying that.
Mr Esquega: Well, the fear I feel is financing heavy equipment and hoping you'll be in operation the following year to be able to pay for that machine or go bankrupt. Those are the unknown fears. Everybody is afraid of change. You don't know what it's going to turn out to be and once it's law there's no way you can change that. That is the scary part. It becomes law and that's the way the country's going to go, whether I like it or not.
It's going to be a big impact on individual entrepreneurs who are trying to create employment for people and their communities. Community forests is what we're talking about. We're not talking about transient people who are coming by. This is our area and I think we should be the ones to log our area. Those are the kind of things.
Mr Wood: There's no doubt that different companies have different methods of operation. Like Spruce Falls where I was working, they spend millions and millions and millions of dollars on equipment and people work by the hour to supply wood to their sawmill that they're building right now and going to produce, or to the TMP plant and in turn, into newsprint. I understand Great Lakes, which used to spend millions and millions of dollars on the large equipment, are now expecting individual contractors to buy their own equipment even if it's $750,000, to do the operation that was being done before.
There is a change, there's no doubt about that. They were financing the operation; now they're expecting the individuals to finance their own operations.
Mr Pattyson: The cost aspect of it, once again, and Mr Esquega's talked about the fear aspect of it: This definition was not in the previous legislation under the old Crown Timber Act, or it was there in a much different form. The intent and the application in the change of the definition is where there is the potential to have additional costs imposed and there is the potential for -- and it's been stated by MNR officials -- that the intent is to regulate the market. I guess that is where the confusion lies and that's where the clarification is required.
Mr Wood: The intent is to protect jobs, to protect communities and create jobs out there -- as the announcement was just made, to create up to 1,500 jobs with three new operations that are out there, with the resources that the province of Ontario has there. This is the intention: to protect jobs that are there, create new jobs and protect the communities, and also make sure we have a forest for the next 80 to 90 years that's going to be continually reproducing so that we eliminate the fears you people are bringing forward here today. That's the intent of the legislation.
Now, what amendments do we have to put in there to make sure we achieve that goal? This is the reason for the public hearings.
Mr Brown: I think Mr Wood said, "The answer is we want to regulate the market," to be short. I think that is maybe a growing concern. I think MPPs are at best just generalists; we know a little bit about a lot of things but maybe not very much about specific things. As we started to go through this exercise, you have to understand that from the time the bill was presented to the Legislature until the time it got second reading was two weeks. There was hardly any time given for interest groups of any kind to let legislators know about what they thought. That's fine. As the Liberal critic, that was okay because we're going to go through these public hearings and people are going to come before us and be able to express their concerns and certainly you're having that opportunity today.
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In reflecting upon it, we have something like -- I haven't counted them, but there's probably 1,000 pages in those manuals. There are regulations. There's a bill with, I don't know, 70 or 80 sections in it and I'm trying in my own mind -- first I thought it was my problem. I didn't understand all of this. I'm kind of starting to wonder whether I should be able to understand it and, therefore, if it's the right way to approach the entire problem.
Perhaps there's another way. You have expressed to us your frustration with mounting government regulatory burden in every field of endeavour. If there's a problem, we fix it. We fix it even if there isn't a problem. As the burden of regulatory process impacts at the ground level, I think people are starting to feel their freedom quite diminished. I think the case you're making here is that markets determine many of the issues that we're trying to deal with today.
My question is: As the government has been unable to define "sustainability," define "ecosystem," how is it that we would be able to put those very promising concepts as the benchmark and then place the regulations in the manuals beside those benchmarks and say, "Yeah, this is sustainable forestry"?
Mr Pattyson: We don't agree with your question.
Mr Wood: We've defined sustainability, we just want to see if everybody agrees with it.
Mr Brown: Well, Mr Wood, and I'm just thinking out loud; this is certainly not a position, it's just kind of rambling thought and we seem to have a bit of time to do that today, would it not have been a far better way to say, "This is what sustainable forests are and we'll put a stamp on that product if it comes from a sustainable forest and let you decide how to deal with the actual nuts and bolts of the forest, knowing that your product couldn't be certified if you couldn't meet an independent audit of the operations?"
Mr Pattyson: To a degree, I guess that's some of the results that came out of the class EA for timber management and I think there are obviously some linkages being made with that four-and-a-half-year process. I think, correctly or incorrectly, that a lot of the regulations and so forth that are in this particular bill are simply saying: "Well, we've gone through basically that process for four and a half years. If we link it closely enough, then that should be sufficient."
Mr Brown: But the EA is law. The cabinet didn't appeal the EA. That's the law of the land. That's how it's got to be. That's a benchmark in and of itself, I think, although it just dealt with strictly timber management rather than forest management. The benchmark is there because the EA has said that this is what's acceptable.
I guess what I'm saying, rather than a lot of regulation, a lot of manuals to say, "This is how you're going to do it," rather than all that kind of stuff, have an independent audit come in, establish on a regular basis that you're actually regenerating the forest, because I think that's essentially what this bill is about. And if that's the case, fine; if not, well, you'll have to fix it. The mechanisms through the trusts, penalties and what not are there, but rather than having somebody chase you around all the time saying, "You can't do this, you can't do that, you can't have that chipper there, you've got to have it over here, blah, blah, blah" --
Mr Pattyson: I think there should be simply some basic, broad, general outline and the interference should be kept to a minimum.
Mr Brown: Because really, what society wants to know is that our forests are being taken care of for both the good of the forest and the good of the ecosystem and also the good of the workers and the communities. It seems to me the market forces, as you mentioned, are going to determine on the one side what a lot of those answers are going to be. We can't be like the Luddites in industrial England who went around breaking the machines because they thought they would threaten their jobs, because what threatens your jobs is not moving with the technology of the day.
The Acting Chair: Thank you very much, presenters. You've given us much to consider and we'll be doing that in the next few weeks.
JACK STOKES
The Acting Chair: I call Mr Jack Stokes to come forward. As everybody knows, Mr Stokes is an ex-MPP who's a legend at Queen's Park. We see his portrait up on the wall still, of course, because he distinguished himself as a Speaker, serving the Legislative Assembly of Ontario for many years, while he was also an MPP. Mr Stokes, we welcome you to this committee.
Mr Jack Stokes: Thank you very much, Mr Chairman. At the outset, I would like to particularly thank Franco for arranging time for me to make a presentation. I was originally scheduled for Fort Frances and then they changed it to Thunder Bay on Monday, I believe it was, and here I am today, after three hours of going through road construction between my home town of Schreiber --
Mr Wood: Jobs Ontario; all those jobs we created.
Mr Brown: The election's coming, Jack.
Mr Stokes: You wish it was tomorrow, didn't you?
It's so nice to see people like Pat and Franco, because I always said when I was down there, it was people like them who kept the Legislature moving. We, as members, always thought that it was us, but on closer scrutiny, you know that it's people like them who are the salt of the earth and it's so nice to see them again.
Over the years, dating back to 1948, we had the Kennedy report, the Brodie report, the Ontario Economic Council report, the Armson report, the Baskerville report, the Reed and Associates report, the Rosehart report, the old-growth forest report, the Hearnden report and many, many others. Some were never made public or saw the light of day for obvious reasons. All dealt with some aspect of forestry, proper husbandry, regeneration, inventory and socioeconomic impact. All, without exception, have advocated the expenditure of more funds for regeneration, greater and more extensive and intensive management techniques to ensure sustainability.
Ontario has a land area of 89 million hectares, of which 56.6 million is considered productive forest land: 35 million is boreal forest, some nine million is boreal barrens and some 12 million is temperate mixed wood-hardwood stands. More than 90% of the productive forest land area is publicly owned and the responsibility of the Ontario government, specifically the Ministry of Natural Resources. Seventy-five per cent of all manufacturing activity in northwestern Ontario is directly related to the forest industry and well over 50% of all employment which is forestry related is in southern Ontario. It is obvious that if we ignore the importance of forestry to Ontario and Canada, we do so at our own peril.
For this new initiative, Bill 171, to reach its intended goal, it requires a total commitment by this government, you as legislators, industry, labour and academia as well as all residents of northern Ontario. This bill and proposed regulations are predicated on the development and use of an information manual, an operations and silvicultural manual, a management plan, a scaling manual and of course the regulations manual itself. For this legislation to have the desired effect requires a change from just timber management to ecosystem management planning and biodiversity. This indeed will be an awesome task of balancing timber, wildlife, wilderness and tourism values and preservation of old-growth forests.
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Another major challenge will be the need to very quickly update inventories to ensure that fibre now being committed to new strandboard and speciality products mills is not at the expense of long-established operations.
All of these new approaches are being planned at a time when operating budgets within the Ministry of Natural Resources over the past two years have been cut by as much as 50% in some MNR district offices.
It remains to be seen whether or not these trust funds that are to be set up will be dedicated in total to renewal and sustainability and adequate funding for additional ministry staff to implement the dictates of this new legislation. Additional funding will be essential for the establishment of audit teams, markers and scalers and data retrieval systems, along with the consultative process involved in setting up planning and citizens' committees.
It is disturbing to learn that depletion, renewal and tending data is not available in the FRI database. It will be interesting to see what the promised annual report of past forest operations will reveal in terms of depletion, renewal and inventory, which are so critical to the stated objectives of sustainability and a holistic approach to ecosystem management.
The draft regulations will include socioeconomic objectives for communities, both native and non-native, and resource industry sustainability. This is an approach which I heartily endorse, but I would ask this committee and the ministry to review the effect or the impact that the concentration of timber licences or volume agreements in the hands of large operators could have on the economic wellbeing of small operators and employment opportunities in small resource-based communities.
It's my understanding that in your earlier hearings, you've had some representations in that regard. I think you should take a really good look at it. If you look at a map in any district office in northern Ontario and you look at the amount of forest land and the volumes of timber of a variety of species that have been dedicated to one particular operator, you can understand the concerns of many of the presenters here, including Sturgeon Timber, including Tim Esquega from Gull Bay. I think their concerns are well founded and I share those concerns.
Another aspect of timber harvesting that is a source of trouble and concern to independent loggers is scaling methods and in paying them for the timber they cut. MNR has a direct and understandable interest in ensuring the accuracy of weight scaling or domestic scaling done by the mills. Generally, they accept the bills of lading provided by industry, with periodic check scaling done by the ministry.
I am advised that the figures used for purposes of collecting stumpage fees by the province can and do vary by as much as 25% to 30% from what the logger receives after the cull factor is taken into account. The ministry says it is not its concern but is strictly within the domain of the buyer and the cutter. This is a source of great anxiety which has caused many small logging companies to declare bankruptcy and a total loss of their life's work. Under this legislation, this is likely to continue unless you people can come up with something that will intervene and make sure that all the players in the forest industry are given a fair shake.
I think it is accurate to say that all stakeholders in the field of resource management feel very strongly that a new approach to land, timber, wildlife, fish and wilderness management is long overdue. Now, we all know that the act that Bill 171 replaces was promulgated 42 years ago, and anybody who says that a new approach to the way we manage not only our timber values but our total ecosystem values is not needed is just not being realistic.
This is not a perfect bill, but a major amendment or a replacement of the Crown Timber Act is obviously long overdue. Anybody who says otherwise, rather than being a part of the solution is a part of the problem. They now feel and realize that our traditional way of life in the past in this part of Ontario depends to a large extent on our collective ability to plan and manage and use and share these resources for the perpetual benefit of this and future generations.
Multiple use has been used as a description for proper sharing of resources for the benefit of society within this region and for those who find an attraction to it from outside. Many people have come to accept the user-pay principle as a way of protecting all of the values that are spoken of in Bill 171 and they also demand results to assure them that these assets that are seldom found anywhere else will be there in perpetuity for all concerned. It follows then that all the audiences that have expressed and will continue to express an interest in and concern for adequate and relevant resource management must be given a role and a collective responsibility and a forum for their views and input into the lifeline of life as we perceive it in this part of the province.
In this bill, I see the opportunity for all stakeholders to buy into the process. If you as legislators present them with legislation that will enable them to continue to enjoy a high level of employment, economic stability and a way of life second to none anywhere in the world, you will have done a service to society that will do you proud and will long be remembered.
It's unfortunate, and this is the nature of the beast, that this bill is so far-reaching, so all-encompassing that you can't do justice to it in the time that's allocated. I was told that I had 15 minutes. I know that members, legislators, are given to verbosity, but this is one subject that has been near and dear to my heart for the past 30 years.
What I have presented you with today really doesn't do justice to the entire process but, given the constraints of time, I'm sure that a lot of the other presenters will have covered most of the things you will want to hear and need to hear in order to come up with either Bill 171 in its present or an amended form, that will accomplish at least the majority of the things that people in this part of the province have aspired to in the past and want to look forward to: a way of managing what is the lifeline of this part of the province for the benefit of all concerned.
I want to apologize that I don't have the facilities for duplicating material that you people have access to down there, but I do have some for Hansard. I would have had more, but my paper crumpled when I got past seven copies, so I gave it up. There are some copies of it there if you want to refer to them, but if there are any questions, I'll attempt to answer them.
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The Acting Chair: Mr Stokes, you are scheduled for a 30-minute time slot and you've just used a little more than 10 minutes, so if you do wish to continue or leave the rest of your time for questioning, that's up to you, however you wish to use your 30 minutes.
Mr Stokes: Well, I tend to ramble when I don't speak from a text. Rather than spend more time in making a more in-depth presentation, I would prefer to respond to questions from the members of the committee, if that's okay.
The Acting Chair: Fine. As you wish. So that'll leave about six minutes for each caucus then, and we'll start with the parliamentary assistant, Mr Wood.
Mr Wood: Thank you very much, Jack, for coming forward and making the presentation. We've had discussions over the years on forestry. You can comment, or you don't have to if you don't want to, but the question I would have out there is that the forest companies, whether it be the large sawmills, pulp mills, paper mills, whatever -- you went back to 1948 when the government, the companies and the MNR had been doing all kinds of studies.
I've met with a large number of the major stakeholders and one of the comments they make to me, either at the committee or in person outside of the committee, is that Bill 171 is moving too quickly. It's moving too quickly for the companies. They can't absorb everything that is there. In your presentation, the way I take it, you're saying that since 1948 we're moving to the point where we are today with Bill 171 and people should have been prepared for it.
Mr Stokes: I used to spend half of my time just researching all of these reports and seeking out people in the industry, in civic government, in labour and saying: "This is what so-and-so is saying. What say you?" We have played around with the Crown Timber Act for well over 40 years, and for anybody to suggest that a Ministry of Natural Resources of whatever political stripe, however it's motivated, is moving too quickly -- I'm not saying this is perfect, but anybody suggesting that it isn't time for a change, a new approach, in my opinion isn't living in the real world.
Mr Wood: Thank you. I know that Mr Bisson wants to ask a question, but you commented that some of your district MNR budgets were cuts as much as 50%. I can relate back to the summer of 1990, when Peterson and the Liberal government decided that the revenues were dropping off very quickly there and they didn't want to face what we had to face as a government and make the expenditure controls and do the things because the revenues were dropping very quickly, and we were heading into a recession or were very close to a depression in 1989 and 1990. I just want to throw that out there. I'll give my time to Mr Bisson.
Mr Bisson: Thank you very much, Mr Stokes. It's always a pleasure to be in your presence. You always have an interesting point of view to bring, especially with all your years in the Legislature and your work on this issue.
I want to come to the question of scaling because that's been raised before. I'm wondering if you can give me some detail. You made the comment that scaling methods utilized by industry are somewhat inaccurate by something like 20% to 30%, you were talking about, in regard to weighing. My understanding is that most of that is done on weigh scales when they bring them into the processing plant, either the paper mill or the sawmill, and I would think that would be regulated by the Ministry of Transportation or somebody in regard to knowing if those things are accurate. Can you explain what this is all about?
Mr Stokes: What happens in practice is that wood is cut and scaled at the roadside or in the cutting area by industry scalers and it's hauled into the mill in two ways. The first way is that it's hauled into the mill and run over a government-inspected scale, and there are bills of lading that are developed as a result of that weight-scaling method. The ministry does an audit of all those bills of lading and on that basis collects crown dues, stumpage dues.
Mr Bisson: On the weight taken off the weigh scale?
Mr Stokes: Yes.
Mr Bisson: Okay.
Mr Stokes: Now, there are other arrangements with other mills where the buyer does the scaling in the traditional measurement way.
Mr Bisson: In the bush.
Mr Stokes: From time to time, the weights and measures section of the Ministry of Natural Resources will do check scaling. People within the ministry responsible for those activities say that with existing technology and with their method of auditing, they feel that what they're being paid by way of crown dues accurately reflects what it is that is being trucked into the mill.
That's a far cry from what an independent logger who is hauling his fibre into the mill receives. I have sent scaling chits from many, many independent loggers into the ministry and asked them to do a check scale on this, but usually it's after the fact and it's almost impossible to trace it. They're saying, "We realize that what the logger gets paid is not a true reflection of what we as the crown get paid."
It's cause for great concern to me and my past constituents when they will invest literally hundreds of thousands of dollars in equipment to go out and try and make a living by operating on a third-party agreement and taking this fibre into the mill, only to learn that in a load, say, with 20 or 22 cords they're getting paid for maybe 18 or 19 cords. You wonder, now, what do they do with that wood? If 22 cords of wood went into that mill and the logger only gets paid for 18 or 19 cords, what happens to that? Obviously, they don't burn it. They chip it and they receive compensation for processing it.
It may not be totally adequate for the production of dimensional lumber, but I feel that the ministry has a responsibility to more closely monitor what goes into those mills. If they want to accept the weigh scale bill of lading, they should look at what a good many of these mills are using as a cull factor. I believe that it is way out of whack, and a lot of people I've spoken to, and literally, unless they go to court -- and there was one case taken to court here within the past year and the logger was successful, but that's a very, very expensive process.
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Mr Brown: Good to meet you for the first time, Mr Stokes. Our problem with this act is basically trying to determine whether it lives up to its title, whether we're really talking about forest sustainability.
You've talked about the numerous reports, and as a relatively new Natural Resources critic I've seen most of them and not been able to fathom most of them. But I've seen most of them, and I understand there are well over 50 studies being done for the ministry at this present time about numerous issues relating to the forest.
It seems to me that it is time for this bill. It seems to me that after the timber EA reported, it was time for the bill. Our problem seems to be, and I guess that's what I'm asking you, does this bill reflect, in your view, sustainability, as the title says?
Mr Stokes: It goes some distance towards trying to describe sustainability. From my point of view, that buzzword came out of Norway and Prime Minister Brundtland and it's been discussed in international fora and it's like statistics. If you talk to five economists, you'll get six different opinions on any given set of statistics.
I'm not suggesting for one minute that this is the be-all and the end-all, but it's at least a beginning. Of course, if you look at the commitments made by the minister and the people who are responsible for such things in the ministry, you come to the conclusion that they're approaching this with an open mind. I don't think they're claiming for one minute -- it would be ridiculous for them to suggest -- that they have all the answers in this bill. But as I said in my presentation, anybody who suggests that it isn't timely and that it isn't time to get on with it I think is deluding themselves.
Now, sustainability to my mind is making sure that whatever harvesting you do, whether it's timber, whether it's wildlife, whether it's fishery values, it doesn't matter; if it's related to the biosphere in which we operate, sustainability in my mind is, don't harvest any more at any given time than you think is there as a base for it to renew and to regenerate itself. You can't do what happened to the cod fishery on the east coast or could very well happen to the salmon fishery on the west coast by running it down to where you don't know whether it's going to be able to rehabilitate itself.
I think we have time, with the values we're talking about, and we must leave enough there, after cutting enough to take care of present needs, but making sure there is a pool, a base, so that it will always be there for future generations. Briefly, that's my idea of sustainability.
The Acting Chair: Who's first? Mr Carr?
Mr Carr: I'll go first with a quick one. Thank you very much, Jack; a pleasure to hear from you.
As we went across the north, for example, a couple of days ago Avenor said, "Don't pass this bill." We were up in Kapuskasing; Spruce Falls Inc said, "Don't pass this bill as is"; in Espanola, E.B. Eddy said, "Don't pass this bill." You heard today the small companies saying, "Don't pass this bill." The native groups, had you been in Fort Frances, said, "Don't pass this bill."
As a former member, how would you suggest that we hear this overwhelming evidence from people -- and I must admit that's without changes, so there may be some changes there -- saying, "As is, don't pass this bill"? How would you as a former member respond to a member like myself who says, "How can I possibly support this bill when the overwhelming players in these communities are saying, `As is, don't pass it'"? How do I do it?
Mr Stokes: I think it's human nature for people to be fearful of the unknown. If you ask them if they're happy with the situation under the existing Crown Timber Act, they will say no. They spend every waking hour being critical of the situation that they find themselves in at the present time. So it's clear that the status quo is not acceptable to anybody. If you ask Avenor, if you ask Boise Cascade, if you ask Kimberly-Clark, if you ask Spruce Falls, all of the major players, they're not happy with it. If you ask the small operators, they're not happy with it.
The thing is, you as legislators are going to hear that. That's understandable. That's almost a given. But that doesn't detract from your collective responsibility to try and fix it. Now, this is an attempt to improve upon what we already have and trying to assure sustainability, as Mr Brown was asking about. But I think you're abdicating your responsibility if you say, "Well, everybody's against Bill 171, so let's just tear it up and go on our merry way." That is not acceptable. That's an abdication of government responsibility.
Mr Hodgson: Thank you, Mr Stokes. It's a pleasure to be here today. We've been grappling with this bill that's called forest sustainability, and I think everyone's agreeable to the broad principles of the act. There's a consensus in society for that. It's disturbing to myself, and we've mentioned it before, and I'm glad to see that you've mentioned it, about this base of information, to know what the benchmarks are and how we can sustain that harvest.
I'm sort of thinking here out loud, but you bring up the analogy of the cod in the Maritimes and the fisheries in the Maritimes. The harp seal has a great deal to do with the cod and there's a connection between when we banned the harvest of harp seals and when we depleted the fish stock, and nobody talks about it in the media. We'd like to blame man for everything. The proof of the pudding is that the Liberal government has reintroduced the harp seal hunt this year and there hasn't been a word of it in the newspapers. They recognize the problem. There was a connection there. We need this information in order to find the connection in how you will have a sustained yield.
My concern is that sometimes we bring in regulations -- the only people who can afford to define these connections on what will be sustainable in our forest ecosystem are the people who have the resources to hire and do the studies. As you've mentioned, the MNR staff have been cut back and the resources aren't there.
My fear is that when we try to regulate, the regulations are based -- nobody'll come out and say, "This regulation's going to help my company." They're going to say, "This is for the public interest and this meets the goal of sustainable achievement."
The small independents that you talk about don't have those resources. And an unintended consequence might be that they're not as competitive any more.
I'd just like your opinion on that. The scaling I've talked about before, and you went into some detail on that. If you take out the cull factor, they'll lower the base price. But I'd like your comments just on the first bit about, how do you measure this?
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Mr Stokes: Well, it was always a great concern of mine, whenever I asked the Ministry of Natural Resources how much the allowable cut was, what portion of the area that had been cut over in any given year was artificially regenerated, which was left to its own -- they call it now free-to-grow -- and it's still a concern of mine, notwithstanding what was said in EA and their report, where they said, "Generally speaking, we don't think there's much of a backlog in untended areas and areas that have been allowed to grow into a weed species."
At one time, when I first got involved, poplar and birch were weed species. You know, you pulled away. It was just a nuisance. Now we've got people prepared to kill just to get a licence to cut those two species. I wish they could do something with the alder, because I could show you tens of thousands of hectares that have been allowed to grow in that. We haven't found a use for them.
But it's that kind of thing that we're not on top of. As I said, I mentioned in there that in the FRI database they don't have a handle on depletion, they don't have a handle on renewal, they don't have a handle on tending, and unless we dedicate sufficient funds within the ministry or academia or within the industry itself to come up with the answers to these things, we're still going to be sort of groping in the dark. But it doesn't mean that you can afford to sit by and do nothing. That's why I think it's important to make a start, as imperfect as it may be.
Mr Hodgson: But it's also important to do it well. Thank you.
The Acting Chair: We'll have to cut it off there. Mr Stokes, thank you very much for coming before the committee. You've given us a lot to consider, and we'll certainly be doing that in the next few weeks.
Mr Stokes: It's been my pleasure. Thank you very much for your time.
RIVER LAKE TIMBER LTD
The Acting Chair: I'd like to call up the next presenter, and the last presenter for our venue here in Thunder Bay, River Lake Timber Ltd. I believe we have a Mr Spittlehouse and an Edward Frisby who will be coming forward to represent this company.
Mr C.G. Spittlehouse: My name is C.G. Spittlehouse and I have with me our forester, Mr Ted Frisby. We appreciate the opportunity of being invited here today to present to you and your committee the reasons why we feel Bill 171 should be rescinded as it pertains to field chipping.
We represent River Lake Timber Ltd, and the function of River Lake Timber is as an independent logging contractor supplying wood chips and sawlogs harvested off Avenor Inc limits at Dog River, Ontario. It's chips being shipped direct to their Thunder Bay mill operations only and sawlogs being delivered to the local sawmills, as per Avenor's instructions. Our total number employed to sustain this operation amounts to approximately 60 people.
Hereunder we shall attempt to outline our reasons why this legislation pertaining to full-tree chippers does not apply:
(1) The fact that River Lake Timber does not have a wood source of its own, but rather operates on Avenor limits. It would therefore be impossible to supply a business plan. As you know, one of the requirements of such a plan is a source of woodfibre.
(2) Under Bill 171, we no longer have security of wood supply as we are being forced to operate under a one-year processing licence. Due to the large capital costs involved to set up such an operation, it is doubtful our financial institutions would be willing to provide financial support under such circumstances. As a matter of interest, the capital outlay to finance a chipping operation such as ours amounts to $5 million. In addition to this, support backups such as road-building equipment, maintenance facilities and transportation vehicles will amount to a further $2.5 million.
(3) The fact that our entire chip production is delivered to Avenor's pulp and paper mill precludes any possibility of our exporting to other markets. If reporting of the disposition of the chips is a concern, they -- Avenor -- capture all of the production from our chipper at the mill, and this information is readily available.
(4) The mill that we supply must compete in quality and price on world markets. The additional cost to formulate business plans and forest resource supply analysis will drive our wood costs up, which will in turn have to be passed on to the mill, putting the mill at a competitive disadvantage.
(5) Will processing licences be granted to the highest bidder with the best business plan? If so, we must then compete with non-unionized operations that do not pay union wages or benefits. Our entire labour force is comprised of union people, all of whom are members of Local 2693 of the IWA. Should our attempts fail in this regard, such a failure will have substantial impact on the union. Avenor operations alone consist of a minimum of 400 woodlands employees.
(6) We do not feel our type of operation falls in the same category as mills, including sawmills, for the simple reason that the mills are in a process of manufacturing a finished product, such as paper, pulp and lumber. This is clearly outlined in the ministry's copy of Bill 171 on page 9, subsection 27(1), a definition of manufacture in Canada:
"A forest resource licence that authorizes the harvesting of trees is subject to the condition that all trees harvested shall be manufactured in Canada into lumber, pulp or other products."
It must be clearly pointed out at this time that our primary function is to produce an ingredient to produce such a product, along with various other ingredients in addition. We also produce sawlogs for the sawmills by processing 16-foot bolts of the larger trees and full-tree chipping the residual. We are committed to a specific quota of logs as specified by Avenor. They in turn have an agreement in place each season with the sawmills with an overall quota embracing all their contractor operations.
(7) A great deal of emphasis appears to be pointing to sawmills that are processing wood in roundwood form. We must point out that our process entails the utilization of the entire tree, including limbs and tops, being a full-tree chipping operation. The quality from field chippers versus sawmills is far superior, being fresher, lower in bark content and are the optimum size distribution which yields per hectare up to 15% versus the old roundwood operations. Such a system bodes well in keeping within the harvesting limits set out in the said licence, which all helps to maintain a sustainable crown forest.
To sum up, the requirement to have an annual processing licence, as we see it, would: (a) place us at a competitive disadvantage with non-unionized operations; (b) remove incentive for future development and financial expenditure as there is no guarantee of future licences; and (c) most certainly jeopardize full utilization of our forest resources.
We ask that the requirement for the full-tree chippers to have an annual processing licence be removed. If for some reason that cannot be achieved, we feel that full-tree chippers supplying wood to a mill under the umbrella of a sustainable forest licence should be exempt from having a mill licence.
That is my presentation, Mr Chairman, and I have copies here I will leave for your panel.
Mr Brown: I've had this discussion with a number of presenters, probably before you came in, but this is an issue that has been raised over and over again here in Thunder Bay. The point I guess I was making was that the chipper is really an extension of the mill. It is just really in a different location.
We've had a lot of debate about what's best end use and whether there really is anything but the market that should decide best end use. Given the fact that some people believe that sawlogs are the best use and then you chip the rest, you're telling me you do that on your limits anyway, that's how you operate.
Mr Spittlehouse: Yes.
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Mr Brown: You do have the capacity to chip that whole tree, but you send it to the sawmill, which is different than some other operators who say they are chipping the whole tree because the economics of their operation indicate that should happen. If you had a choice, which is the most efficient for you? If you were out there on your own and didn't have contracts with Avenor and didn't have to operate under regulation, would you be chipping the whole tree or would you be sending it to the sawmill, if competitive prices were the only determinant?
Mr Spittlehouse: In answer to your question, no, we wouldn't. I must reiterate that we only take the 16-foot boles out of the trees that are large enough to do this, and we chip the rest. I suppose it would be nice to just throw the whole thing through the chipper. I myself have been in this game now for 29 years. Ted is a university graduate. He's been in it several years. We've also been heavily involved with regeneration. No, we don't think merchantable timber like that should be thrown in and chipped. It's not necessary. We would prefer to continue supplying sawlogs as we are now.
Mr Brown: But really, that determination can be made in the forest just by the licences granted by MNR on that particular area, so the government would have control. It really doesn't relate to the actual method of harvest or how you transport the tree to the plant. That's really what it's about: You're making it easier to transport and more efficient to transport the tree to the mill by chipping it rather than leaving it in a roundwood form. Am I wrong in that? There would be transportation advantages to chipping it right where it stands, besides the obvious efficiencies in the woodland itself.
Mr Ted Frisby: That's correct. The efficiencies aren't only in transporting the wood, but there are certain other steps that you can eliminate from the process -- delimbing and slashing, those sorts of things.
Mr Brown: I understand the first part about the woodlands efficiencies, but could you give me some indication just on how more efficient it is to transport chips rather than wood in the round? Obviously you get more chips per cubic foot of space on a truck. Do you have any numbers on that?
Mr Spittlehouse: I think the proper way to answer that one is that when you're shipping roundwood to the mill, you're shipping probably 10 to 15% of waste in the form of bark and so on, whereas chips are solid woodfibre. That's where the big difference is.
Mr Brown: You're also shipping a fair bit of air between the logs and what not when you're moving them in round as compared to what they would be --
Mr Spittlehouse: That is correct.
Mr Brown: It would cost more trucks to do it.
Mr Spittlehouse: Yes.
Mr Brown: Maybe we can have this discussion after.
Mr Wood: There's air between the chips, too.
Mr Brown: Yes, I understand that. The parliamentary assistant's a lot of help most of the time here.
Mr Carr: Thank you very much for your presentation. You laid it out very well in terms of what you want to see. I take it that if these changes are incorporated, some of the things that you've outlined here, if they come in as amendments to the bill, then you'd be happy with the bill, as long as you get these changes?
Mr Spittlehouse: Yes, sure.
Mr Carr: Okay. When we go through clause-by-clause we're going to hopefully get an indication of what changes the government will make. Obviously we don't know. We've heard numerous people like yourself outline some of the concerns. I think that will probably be addressed in clause-by-clause and we would appreciate your feedback at that time. I know it's difficult to keep in contact with what is happening, particularly when you're trying to survive and prosper, but if the amendments do come in and the changes and what the government says it will do make it acceptable, we need to know that. Hopefully through the clerk we can do that. Certainly we'll attempt to make sure that the government brings this forward, but we obviously need to rely on the government for the decisions.
I think you've laid it out very clearly. They certainly have heard this day after day in our hearings. Now it's up to the government how it's going to respond. We'd appreciate whether you still, at the end of the day, feel like your amendments have been met. If so, we would look for your guidance.
I think Chris had a question. I see him looking at his watch. He probably wants to get on with it. Good luck.
Mr Hodgson: Thank you for your presentation. I just have one quick question, just a clarification. We've been told -- we've heard before too -- about the financial implications of a one-year licence, that it's not enough guarantee to the banks. But we've been told that it presently exists that way to the operators -- not yourselves -- who were responsible for it in the past.
Section 5, paragraph 5, of your presentation: Can you explain this in a little more detail? Your concern is on how the licences will be granted if you do it every year and that you will have to compete with non-unionized -- it'll be done probably competitively. Is that your indication?
Mr Frisby: Yes, right. We are concerned that the licensing process will be used to regulate who can conduct business to operate as a contractor or a chipper operation in Ontario. Will the licensing process, by having a business plan, be given to the highest bidder who has the best business plan, who is operating with non-unionized people, who can cut certain costs that we can't?
Mr Hodgson: I'm interested in the government's response to this as well, so I'll forfeit my time to allow more lengthy give and take with the government, if they should so wish.
The Acting Chair: That's very generous of you, Mr Hodgson. We'll go over to the parliamentary assistant first.
Mr Wood: I think that next Tuesday in Toronto we're going to have an opportunity to get into more dialogue with this with the IWA Canada union. It's coming in to make a presentation. I'm sure that we can get a dialogue as to how they feel their membership throughout Ontario could be affected.
I want to get into another area of concern that's crossed my mind as we're talking about chipping operations, whether it be permanent chippers or whether it be portable chippers, and the waste, sawdust and bark. In Spruce Falls's operation in Kapuskasing, they save millions of dollars a year by burning the bark and sawdust. They save on natural gas costs and they produce the steam and whatever. In Cochrane they have cogenerating plants. It's a fuel they use to produce electricity. There are these operations all throughout northeastern Ontario and I'm sure there are some in northwestern Ontario at some places. What happens to the bark and sawdust that other companies like Spruce Falls use as fuel? They save millions of dollars a year in using this product. What happens to it now? Is it trucked or transported to some spot or is it left in the bush?
Mr Frisby: I can only speak now on behalf of Avenor -- they're the people we work for -- which does some cogeneration at the moment. Some of these closer-in chipping operations are producing what they call hog fuel. They don't ship just the bark and waste in that form; they process it in the bush with the hog fuel processors and it is trucked to the mill.
Avenor still is processing roundwood for, I believe, another one year, when this operation will cease. Then this hog fuel operation will be increased to compensate for the loss of the waste their getting out of their wood rooms now. I would certainly expect that we ourselves will be processing that within another year.
Mr Wood: I'll leave my time to Mr Bisson.
Mr Bisson: I'm curious about something. I take it that your operation -- you're a wood-chipping facility for what company again?
Mr Frisby: Avenor.
Mr Bisson: So you're not taking the wood from your own limits; you're cutting off other people's licences?
Mr Frisby: Right.
Mr Bisson: Do you presently get some kind of a licence to operate?
Mr Frisby: No.
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Mr Bisson: I guess what's before us as a committee is how do we deal with wood-chipping facilities, because as you know, presently all wood-processing facilities have licences like any other business. From the corner store to the business that's down the street here in regard to the paper mill, all get a licence every year. That's a requirement of doing business, and with those licences there are conditions that you have to meet in order to hold on to your licences. I guess what's at question is, should wood-chipping facilities be licensed? That's what I'd like to pursue here a little bit.
The concern that you have is that -- I'm not sure if I follow this 100% and this is where I need clarification -- if you're required to have a licence, you're worried that your licence will be tied to the flow of wood off your own section 24 licence. Is that what the concern is?
Mr Spittlehouse: Well, the fact that we do not have a licence, that we operate on Avenor's licence. We do not have a wood source. Therefore, how can we produce a business plan if we don't have a limit?
Mr Bisson: If I was to go out and start a wood-chipping facility now and I'm going to go to the bank, I've got $100,000 of my own money and I'm going to go to the bank and borrow some money to be able to start the business, what's going to predicate me from being able to get the dollars from the bank is a contract with another wood-processing facility that I'm going to sell my chips to. Right?
Mr Spittlehouse: Right.
Mr Bisson: That's basically how I read how this works. I was looking at the regulations through your presentation. What it's basically saying is, "Before issuing, renewing or cancelling a forest resource processing facility licence, the minister may require that a business plan be put forward." It doesn't say "shall"; it says "may." I guess it gives the minister a certain amount of flexibility when it comes to your kind of operation. But I would not be able to borrow the money unless I've got a contract for somebody supplying me wood and somebody to sell it to. The bank would never give me the money. Where I'm having a problem trying to make the connection is how the licence would put you out of business, because it's not the licence, it's the ability for you to get a contract to sell your product.
Mr Spittlehouse: The point I made there was the fact that a processing licence is only going to be granted for a term of one year, as we understand it.
Mr Bisson: Like every other licence in Ontario, yes.
Mr Spittlehouse: I don't think that's the way it is now, is it?
Mr Bisson: Every mill processing facility, be it a paper mill, a sawmill or the corner store, gets a licence to operate for one year. Some are municipal licences, others are provincial.
I sympathize with where you're coming from, but I just want to make sure that I understand, because what I'm interpreting you and others saying is that what you're worried about is that if you get a licence it would mean to say that you have to have the supply of wood. In talking to ministry officials, that's not how I read this. I read this as saying that we don't want to allow people to go and build up mills and not have a supply of wood. Because of the battle we're having now in the forest, there's sometimes not enough wood to go around. If you allow more and more sawmills to establish themselves, or chipping operations or pulp and paper mills, if you don't have the supply of wood to supply them, you're going to have a real mess on your hands. That's what this is intended to do.
I see you as an extension of a wood room, basically. That's taking the wood room out of the operation, putting it into the forest, and your licence is really subject to your availability to sell your product to the mill. If we can, let's say, calm your fears in regard to that, that it doesn't mean to say that you have to have a supply of wood -- in other words, under a section 23 or a section 24 of the bill -- that it's predicated on your business plan in regard to you can sell your chips because somebody wants to buy them and somebody is going to supply you with the raw material, would that satisfy your fears or would that answer your fears?
Mr Frisby: We are somewhat concerned that, maybe not today, maybe not five years from now, but at some point in time, as the legislation would stand the minister could say: "There are too many chips on the open market being supplied by sawmills and such. We're not going to grant you a licence this year." Does that possibility exist?
Mr Bisson: It exists now by virtue of the market. We had that exact situation in Hearst, and in Cochrane and Timmins, where the market wasn't there for the chips and it basically shut down the mills to a certain --
Mr Wood: Sawmills had to shut down.
Mr Bisson: The sawmills, yes.
Mr Frisby: All of our chips are captured by Avenor's mill, so we have a definite person we supply our wood to. But could you in the future say that these chips that are being produced as a byproduct of a sawmill, there are enough of them on the market that we no longer can operate, that Avenor must absorb all the chips produced at sawmills, thus not granting us a licence in the future?
Mr Bisson: I'd have to go back and check the answer on that to make sure, but the way I understand the legislation is that it's not intended to deal with the best end-use policy, and that's what you're referring to. There's a fear within industry that this is what we would like to do, and to a certain extent maybe that's something we should look at. But what I want to do is I want to make sure that the legislation works for you. Everybody on this committee has that as an interest. If we can clarify the question of the portable mill issue in regard to the legislation, in order to make sure that we view you as the extension of the wood room and not so much the person who holds the section 23 or 24 licence, my question to you is, does that respond to the fears? Would that satisfy your concerns? I want to make sure that you can do business. That's the bottom line here.
Mr Frisby: Yes, I understand that. I guess that is part of the fear that we have, that there isn't that line drawn that we are an extension of the wood room, because we've always been producing wood in raw wood form and sending it in. That was fine. But this doesn't define that we are an extension of the wood room. It sets us up to appear to be a mill separate from everything else, operating on our own. That's some of the fear we have.
The Acting Chair: Gentlemen, thank you very much for your presentation. There is much to consider. We appreciate your appearing before the committee here today.
Mr Brown: Mr Chair, I would move that the Elk Lake Community Forest, represented, I believe, by Paul Tufford, be heard in Toronto next week.
Interjection: Agreed.
Mr Bisson: For a half-hour?
Interjection.
Mr Brown: I would also move that Marie Rauter be heard for one half-hour in Toronto next week.
The Acting Chair: Let's just deal with one at a time.
Mr Brown: I think the first one was agreed to.
The Acting Chair: The first one is agreed, so there's no discussion on the first one. That's one of the government's pilot projects. We're going to see that.
You've now moved a second motion distinct from the first.
Mr Brown: That Marie Rauter be heard for one half-hour.
Mr Mammoliti: Can I just get an indication of the schedule next week?
The Acting Chair: Sure. I'll defer to the clerk.
Mr Mammoliti: I know that I've made a number of plans myself next week and I'd like to know what the schedule is before we go any further.
The Acting Chair: I'll call upon the clerk to answer that.
Clerk of the Committee (Mr Franco Carrozza): At the present time, Mr Mammoliti, there is time for the Elk Lake Community Forest, and if the committee agrees to the request from Mr Brown, there is time for a half an hour for that individual.
Mr Mammoliti: When?
Clerk of the Committee: Next week. I can give you an idea.
Mr Bisson: Can you tell us what the time slot is?
Mr Mammoliti: Yes, what are the time slots?
Clerk of the Committee: We could have 4 o'clock to 4:30 on Tuesday, August 30, and 4 o'clock on the Wednesday. The dates are open.
The Acting Chair: That answers your question, Mr Mammoliti? All right. Is there any more discussion on the second motion of Marie Rauter coming before the committee or is that agreed to by the committee?
Mr Hodgson: When we talked about this earlier, I stated that it's been the common practice of this committee to allow people to speak for half an hour, and this just follows along with that. Kapuskasing was an example; today is an example.
Mr Mammoliti: I was just concerned about the dates.
Mr Bisson: I view this as a friendly motion and I think this is something the government can support. Our only concern is that we want to make sure we don't send out the signal that one group is more important than the other. But certainly we've had the opportunity where people have made more than one presentation. We'd support that.
The Acting Chair: Thanks very much. Is any more discussion needed or can we just vote on this?
Mr Wood: Just briefly, the difference here is that she's not bumping anybody else out of their spot who would have to be rescheduled.
The Acting Chair: I take it, then, that's accepted by the committee. All right. Thank you for that.
The committee will adjourn to Toronto on Monday, 1 o'clock.
The committee adjourned at 1300.