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Tenure has one primary purpose: to spur investment by offering forest companies a guaranteed wood supply. In other words, the

- forest company uses a guaranteed

supply of raw materials as security to borrow the money they need to set up shop. With this money, they build or upgrade an existing mill and buy the various pieces of sundry equipment they need from time to time in order to manufac- ture lumber or pulp. For the forest

' industry, tenure is simple. Tenure

is the economic catalyst that keeps their industry humming along.

Few members of the public really

understand the term tenure, how- ever. Most people recognize it as something big and powerful but at the same time see it as something shrouded in mystery. For most people, tenure is something for politicians, bureaucrats, Company executives and financial wizards to dabble in; not something for the common man to ponder.

Tenure is complex. There are several different types; each with

‘its own set of rules. Is this really

necessary? Tenure is confusing. Not every-

he mystery of tenure

one qualifies for a particular type of tenure. On the surface, it almost appears to be selective by com- pany status. Is this really true?

Tenure is mysterious. No other industry in the western world needs a guaranteed, supply of raw materials in order to operate. Why the forest industry? Money lenders don’t ask Alcan, for example, to put up a bauxite mine as security for a loan. Alcan’s security, as is common in our economic world, is a quality product and an estab- lished market.

It’s the same for a local retailer. His security is the product be has

to sell and the potential market he has to sell it to. A furniture store doesn’t need to own the factory. The owner buys and sells on the open market.

For some reason, though, when the forest industry was establishing itself in our province, it was decid- ed that in order for the forest in- dustry to operate they had to own the resource they wished to use in the manufacture of their product. This was a problem, though — the

Tesource was sitting on public land

and a way had to be devised to

Letter to the Editor Sad reflections on rail travel

Open letter to:

VIA RAIL CANADA INC. P.O. Box $116

Station A

Montreal, Quebec

H3C 3N3

All my life I’ve been a great rail fan. I think train travel is the best mode of transportation and am very sad at the current cut-backs in Canada.

Having said this, 1 must tell you about a recent trip | had that may put some humour in your life today, as it was really a joke.

I boarded the "Skeena’ train at Burns Lake, B.C. At least I think it was Burns Lake. The station was boarded up, glass was strewn all over the platform with a few wine bottles still intact, and the area was

totally in darkness. At 4:09 in the »

morning a morgue would be live- lier. The conductor later said he

- was embarrassed to let passengers

off there.

‘Anyway, the train did stop and pick me up, but the conductor said he could not sell me a ticket to my destination, Terrace, but only to Smithers, which was where his territory ended. The fare from Burns Lake to Terrace is $25, but buying a ticket to Smithers and then another to Terrace would cost me $6 more. After about an hour of contemplating what to do, he suggested I just wait and buy a ticket in Smithers from the atten- dant there. On arrival in Smithers, the lady in the waiting room said she didn’t work for VIA but rather for CN, and the station didn’t sell

tickets anyway. I would have to buy my ticket from the new con- ductor.

Well, I finally did buy my ticket, not from the conductor, but from the baggage man, who seemed to be in charge of this important

matier. The previous conductor obviously didn’t know this. 1 always thought the conductor was the chief of the train, but I guess times have changed.

It was very nice to see better equipment on the ’Skeena’ includ- ing a dome car, but why were all the seats facing backwards? | suppose someone forgot to turn the car around, but later I discovered this happens quite regularly, even though I understand there are facilities in Prince Rupert and Jasper to do this. I guess VIA feels it’s more fun to see where you've been rather than where you're going. The railway has been going backwards for the last few years anyway. .

I wonder why no one cleans the windows? Oh well, what can you do. At least this train is still oper- ating, for now.

In the dining car, where by the way, the staff were very pleasant and the food surprisingly good, conversation got around to why VIA didn't promote the *Skeena’ train service in towns and cities: along the route as it certainly is a pleasant way to travel. Is there a marketing and promotion team in the VIA management? Most people in the area don’t know the train is still running, but I guess

. Terrace Review — Wednesday, August 8, 1990 A7

by Tod Strachan, in consultation with Rod Amold and Doug Davies

rent or offer ownership of that resource. The end. result was a form of lease called- tenure.

It must have made sense at the time but in retrospect the arrange- ment seems a little strange. How can you use something you don’t own as security? How can you offer as security something you

tenure, along with what might be one of it’s biggest flaws. Basically, we (the government) rent our trees to a forest company, which cuts them down and turns them into a product worth moncy. The trees, in most cases, are supposed to be replaced, and from this we get the idea of “Forests Forever". Once

lease or rent, and have your banker believe he will own it if you don’t pay off your loan? Isn’t this a little like leasing a truck and then using it as collateral to borrow the money you need to buy your own? Ask your banker if this option for personal development is available to you.

In the past couple of weeks we've introduced the idea of

PE ill a”

the easiest way to get rid of the service is to not tell anyone about it.

One rumour I heard perked me up, though, and that was about Amtrak bidding for the rights to operate a train from Seattle to Prince Rupert via Vancouver and the tracks of B.C. Rail to Prince George. What a marvelous idea to connect mainland U.S.A. to Alaska by rail and the Alaska Marine Ferry system. ,

Isn’t it strange to you that the *Skeena’ only goes from Prince Rupert to Jasper? Anyone going in this ‘direction wants to at least go as far as Edmonton. To complete the journey to Edmonton you must wait eight hours in Jasper until the ’Canadian’ transcontinental comes by. Going west, it’s a little better. Only a six-hour wait. 1 guess the businesses of Jasper are happy. What else can you do for eight hours in Jasper? You would think the timetable planners could have done a little better job. Maybe they own a restaurant across from the VIA station in Jasper. What other explanation is there?

All over the world, railways are exploring and making train travel an important part of their transpor- tation system, including Australia.

When are we going to wake up? .

Maybe our politicians should ride

‘backwards to work in the dome

car. It's the only way they seem to look.

Robert Q. Smith

. A great rail fan

‘Terrace.

this new crop grows up we can rent them again to the same or a different company, and so the process goes.

The basic problem we pointed out last week, however, is that we’re renting the trees and not the land. We have no way of knowing if the first tenant is harming the

land in such a way as to render it useless, We have no guarantee that

the ‘next°crop of trees will even

grow.

Over the next two weeks we're going to take a cursory look at the basic forms of forest tenure, and in subsequent weeks look at each in greater detail.

To begin with, there are seven basic forms of tenure, only four of which really offer any kind of long term security. The four are the Tree Farm Licence (TPL), the Forest Licence (FL), the Timber Licence (TL), and Crown Grants. The. other three, which take a slightly different form, are the Pulp Harvesting Area (PHA), the Tim- ber Sale Licence (ISL), and the Wood Lot Licence. Today, we'll look at the Tree Farm Licence and the Forest Licence.

The Tree Farm Licence, one of the biggest forms of tenure, is land based, In other words, it has defined boundaries. The term of this form of tenure is 21 years, and it can be renewed every five years. This means that the forest com- pany holding a TFL never has less than a 16 year supply of timber.

The licensee is responsible for

John Pifer —

Continued from page AG

Parting Thought: ‘Highlight’ of the week at the Parliament Build- ings was the visit of a New York TV crew from the slick’n’sensa- tionalizing ‘tabloid news’ pro-: gram A Current Affair. And yes, they were here to do the Bud Smith and Margot Sinclair saga. Can you imagine the kind of ’topspin’ they will put on that one?! I’m told the segment will alr within the next (wo weeks.

basic silviculture. He must take care of the seedlings he plants until they are considered to be free growing. Free growing is the point where a tree is considered to have: matured sufficiently to survive competition from other species of plants or trees.

The owner of a TFL isn’t given a wholesale licence to cut every- thing in sight. He is restricted to some degree by an Annual Allow- able Cut (AAC), calculated on the total volume of timber available within the TFL. This AAC deter- mines exactly how many trees the licensee can cut each year, and, according to theory, means that by the time he reaches the opposite end of his TFL the point where he began will be ready to harvest again.

For rent, the holder of a TFL pays 45 cents per cubic metre based on the AAC, not the total volume of timber in the licence ‘area, -In- addition. to: this, the licen- see pays 15 cents per cubic metre when he signs his first contract. This amounts to a performance bond which insures silviculture work will be done and full stum- page fees will be paid.

A Forest Licence differs from a TFL in the length of contract, cost, and the fact that it is volume-based rather than land-based. A Forest Licence offers a 15 year term, renewable every five years, and the rent is set at 25 cents per cubic meter based on the AAC. There is a first-time 15 cents per cubic metre fee for the performance bond.

Under this form of tenure, the licensee is assured a specific volume of timber in a Timber Supply Area (TSA) but ail the timber won't necessarily be in the same geographical location. Over the entire TSA, however, he is offered a guaranteed AAC.

The licensee surveys the TSA, finds an area of timber he wants tO cut, and asks the Ministry of Forests’ permission to do so. As long as the licensee is below his AAC, however, there is an obliga- tion on the part of the Ministry to grant permission.

Forest Licences sometimes cause a little disagreement between com- peting forest companies. On occa- sion, more than one company expresses a desire to cut the same stand of timber. When this happens the Ministry has a “hands off" policy. It’s up to the forest com- panies involved to come to a mutual agreement on ‘their own.

Next week, we'll look at the

Temaining five forms of . forest

tenure before examining the pros and cons of each in gteater detail.