An alliance of northwestern municipalities formed in 2014 to push for a revenue sharing agreement with the provincial government for a cut of profits from resource development in the area has been turned down – at least for the time being.
The Northwest Resource Benefits Alliance – which represents the communities in the regional districts of Kitimat-Stikine, Bulkley-Nechako and Skeena-Queen Charlotte – has been seeking an amount in the hundreds of millions of dollars to be redistributed to the area for infrastructure and other upgrades. The communities would be accommodated under a single sharing agreement.
In a letter from the Ministry of Community, Sport and Cultural Development dated April 22 and addressed to Regional District of Kitimat-Stikine chair Stacey Tyers, the government laid out the reason for rejecting a request for $1,131 million for planning and delaying any agreement.
“The tone was a surprise. It was exactly the opposite of the previous correspondence, but we are still hopeful that we can go back to the table and talk to them,” said Tyers, adding that the alliance has already sent another letter “asking on a political level to meet again and try to get on track.”
The money the group asked for was needed to do necessary legwork to secure a wide-reaching deal, she said.
“To actually bring together all three regional districts is incredibly expensive and we would have to do that a couple times just to make sure that everybody is on the same page,” said Tyers.
Local governments and the provincial government have already spent money planning for the agreement which they hope will be like the one the government has with industrial-based communities in the northeast called Fair Share.
According to the government, it is too soon for a revenue-sharing agreement to be signed and they are unwilling to commit more money for the initial planning at this point.
“It is in our view, premature for the province to consider entering into any agreements that would see those revenues dedicated before they are realized,” says the government letter. “Future benefits from LNG development have not been incorporated into provincial revenue forecasts,” it continues.
However Tyers said that the agreement would be based on new money in other sectors, not just the proposed liquefied natural gas industry.
Despite 18 export plants proposed and 12 export licenses granted, not one of the gas companies has made up their mind to go ahead with their coastal liquefaction plants.
“Mining, forestry, any resource development in our area really. We are looking at new revenue, we are not asking them for a piece of the revenue they currently have, we recognize that is committed elsewhere, but we are looking at new resource revenue,” said Tyers.
Tyers said the revenue sharing would be an incremental sharing of this new industrial profit.
“We are looking at a model on a percentage basis, so if they don’t get revenue, neither do we. There’s no reason to wait for a final investment decision to create a framework because then it is too late. They did know that was what it was, so I am not really sure where the communication got lost again, but we are hopeful to get back to the table.”