B.C. deferring stumpage for three months
The B.C. government today announced it is deferring one of the fees it charges to help people, communities and forest companies navigate through the COVID-19 crisis.
Stumpage, the fee operators pay the province to harvest, buy or sell trees from Crown land, is being deferred for three months.
“As government, we had already taken a number of steps to help forest communities and the industry because they were facing tough times even before the COVID-19 crisis came along,” said Premier John Horgan. “Now, we’re deferring stumpage fees so companies can maintain their financial liquidity, which will not only benefit them, but ideally, forest workers and communities as well.”
The deferral with interest is available to Tree Farm Licence, Replaceable Forest Licence and First Nations’ Woodlands Licence holders who are in good financial standing with the Province. They also must be following through on their reforesting obligations, explained an April 30 Ministry of Forests, Lands, Natural Resource Operations and Rural Development media release.
The deferral will leave eligible companies with an estimated $80 million so they can pay employees, pay contractors and pay other bills needed to keep their doors open or reopen them faster.
“We’re building on other measures we’ve taken to help the forest sector navigate this crisis,” said Doug Donaldson, Minister of Forests, Lands, Natural Resource Operations and Rural Development. “What we’re announcing today may allow some companies to get back online sooner rather than later when we get through the situation we’re in now – or it may save other companies from having to shut down altogether.”
Ravi Kahlon, Parliamentary Secretary for the Ministry of Forests, Lands, Natural Resource Operations and Rural Development, said: “COVID-19 just added to the challenges facing our forest sector. In conversations with the forestry industry, the deferral of stumpage was a key ask, and I am pleased our government has been able to deliver support to companies, contractors and workers.”
Kahlon added that the $69 million fund announced last fall to support British Columbia forest workers affected by mill closures and shift reductions in several B.C. Interior communities included new supports to make sure people have access to the services they need. This includes everything from training, to work placement, to early retirement. It also includes community support grants for communities that have been hardest hit by a mill closure or curtailment.
On March 26, government announced a list of health and non-health services that are essential, as part of its ongoing response to COVID-19.
These include businesses that ensure global continuity of supply of primary and value-added forestry/silviculture products (e.g. lumber, pulp, paper, wood fuel, etc.), including soft-pulp products, such as protective masks, gowns, drapes, screens and other hospital supplies, as well as household paper products.
Government also acted to deliver relief and support in response to COVID-19, including a $1,000 boost to any employee eligible for employment insurance (EI) or the new federal emergency benefits for those who don’t qualify for EI. It’s also why legislation was tabled that will mean no one can be fired for taking time off work to follow the advice of the provincial health officer.
As well, major industries like pulp and paper mills and mines, will have the opportunity to defer 50% of their BC Hydro bill payments for three months.
“The deferral of stumpage fees is an important short-term measure to help alleviate some of the unprecedented financial pressure brought on by the COVID 19 crisis. It will help B.C.’s forest companies put people back to work in communities as markets come back and we move towards economic recovery,” stated Susan Yurkovich, president and CEO, Council of Forest Industries.
The stumpage system in B.C. is called the market pricing system. Stumpage is calculated every three months, ensuring companies that harvest on Crown land are paying a fair market rate and the people of B.C. are getting fair value.
Unlike Alberta’s tenure system, B.C. does not have a universal stumpage rate because B.C.’s forests are more diverse. Stumpage is based on volume of timber, species and grade.
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