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Archive for October 23rd, 2008

Town Hall on SFPR at the North Delta Firehall

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UPDATED October 28 with link to Eric’s speech

I was privileged to be invited to be an “expert” at a meeting last night. My assigned subject was the lack of economic rationale for the Gateway in general and the SFPR in particular. But by the time my turn came to speak both Joe Foy of the Wilderness Committee and Don Hunt of the Sunbury Residents Association had pretty much covered that ground. The Panama Canal, the North West Passage and Prince Rupert had all been mentioned.

I did start with the decline in trade from China, which has already created spare capacity at other Pacific Coast ports. But the point I think I missed is the one about railways. The SFPR is anchored on the notion that ii is somehow necessary to truck containers from Deltaport to Port Kells. But actually the CP and CNR both run double stack container trains directly from Deltaport to their shared mainlines across the Rockies. The containers that leave the port on trucks are for local distribution and mostly the goods they carry get unloaded at various warehouses and the sorted and loaded back into other containers and trailers for delivery to retail stores. I have noticed increasing numbers of CN trucks on the roads around the region, and that is because CN is increasingly a vertically integrated logistics company. I suspect that it may help the railways reduce the number of trains on the Deltaport line – which is mostly single track and runs though a lot of level crossings in Langley. The coal traffic through Deltaport is no longer solely a Canadian affair as both BNSF and UP have been running coal trains to the Roberts Bank terminal.

Guy Gentner, the organiser of the meeting, is an advocate of short sea shipping. He points out, quite correctly, the none of the alternatives like this were properly examined yet the EA certificate was issued anyway. He had a copy of a report to the Port of Vancouver which examined this subject a few years ago and found that it would be cheaper than trucks. Which is quite credible, given the number of containers that could be moved on a barge. But it still bothers me that double handling containers on and off a barge just to put them back on a train – for example at Surrey Fraser Docks – must still cost more than putting them directly onto trains at Deltaport. A few years ago there was considerable congestion in the railyard there, but that is certainly not the case now.

CN Double Stack container train at Roberts Bank October 5, 2008

CN Double Stack container train at Roberts Bank October 5, 2008

Charlie Wyse the NDP MLA for Cariboo South was in the audience and he talked about the availability of land in his constituency that lies between the CP and CN main lines and would be a much better place to store containers than farmland in Delta. It is also happens to be well located for containers from Prince Rupert as well. Though again I am not sure that containers need to be stored quite so much, as the declining dollar means exports to China and other Asian destinations are more competitive. Although typically Canadian exports to these destinations are overwhelmingly bulk commodities that are uneconomic to containerise, US ports are reporting increasing flows of loaded export containers.

Eliza Olson was, as usual, highly persuasive about the importance of Burns Bog – and the issue of the the Covenant which protects the bog and the ability of Delta Corporation to use this as a legal block to port development is likely to continue. Unfortunately the finely nuanced details of this procedure is not the sort of thing that gets much discussion at this sort of meeting, but the number of Delta Councillors present, and the imminence of local elections, suggests to me that it will continue be a very significant issue there.

Eric Doherty was quiet and measured – but dealt with the subject of P3s with considerable humour. The complexity of these deals, the shakiness of many of the institutions that promote them and the continuing credit squeeze all point to the conclusion that the Gateway is anything but a done deal. Of course while this meeting was assembling Gordon Campbell was making his announcement which includes accelerating unnamed infrastructure projects. While a number of private sector developments under construction have been halted (the developers say “temporarily”) I do not have any sense that this is yet freeing up a lot of capacity. I am still struck by the amount of imported labour and expertise that is necessary for projects that include major civil engineering works, and I am skeptical that there is much of a local multiplier if most of the money spent on bridges and tunnels actually gets sent abroad. I tend to agree with Carole James that this announcement was slapped together hastily and it shows.

The star of the evening was Corky Evans, who is not running in the next provincial election, and was therefore even more unconstrained than usual. He was at the same time funny and rabble rousing. He picked up the point about the SFPR being more about land development than transportation. There are, he said, two easy ways for capitalists to make money. “1. Add sugar 2. Change zoning” The good thing about the second one is that you do not have to even buy sugar. “Paving over what we need [to grow food] to eat is whacko”. He farms on the side of a hill and on thick sticky clay. Farmers in Delta have flat land and the best soil in Canada. But once this is paved over for container storage and big box stores it will be lost forever. He praised Guy Gentner for standing up against the Tsawassen land deal – and defying party discipline to do so. He also pointed out that the only other way to make a ninefold return quickly on invested capital is dealing heroin. And there is a strong similarity in the morals of drug dealers and property speculators.

Guy Gentner expanded on this theme, and detailed the activities of a “bunch of lawyers” who set up a company called (appropriately enough) Quick Assets. They have been active along the Sea to Sky and the SFPR purchasing land along the corridor before the final route determination. One 20 acre parcel they bought for $1.7m (an otherwise worthless piece of land due to soil contamination) which was later sold for $3.7m. He also noted that the project has not yet started expropriation but is willing to buy properties along the route that are offered. But the prices the project will pay are well below comparable properties in other parts of the region. That is because the route of the SFPR has been generally indicated for over 20 years and that has had a depressing effect on prices even before the present credit crunch. For people without mortgages accepting these offers now seems preferable to waiting longer in a declining market, but a group of owners whose homes are threatened are gathering together to try and present a united front.

The arrogance of the BC Liberals appears to be cracking. The Premier has now recalled the legislature – only a few weeks after cancelling the fall session becuase there was “nothing to talk about” and MLAs were better occupied in their constituencies. I do think this is going to be an interesting session.

Written by Stephen Rees

October 23, 2008 at 7:36 am