Making Biggest Bigger: Port Metro Vancouver’s 21st Century

CanadianPoliticalScienceReviewVol2(4)December2008

MakingBiggestBigger(76‐92) 76

MakingBiggestBigger:PortMetroVancouver’s21stCenturyRe‐Structuring–GlobalMeetsLocalattheAsiaPacificGateway

KevinGinnell(SimonFraserUniversity),PatrickSmith(SimonFraserUniversity)andH.PeterOberlander(UniversityofBritishColumbia)1

Abstract

Vancouver’s Port is Canada’s biggest. On January 1, 2008, it got bigger ‐restructuring the Port of Vancouver, the Fraser River Port Authority and theNorth Fraser Port Authority, into a single Vancouver Fraser Port Authority,marketed(asofJune,2008)asPortMetroVancouver.1Thisnewentitywastheculmination of a process of divestiture, re‐organizational adjustment, shift tomarketorientationandconsolidationthathasplayedoutoverseveraldecadesacrossCanada’sports.Thisarticleexaminessomeofthisrecenthistory–bothintermsof(i)divestitureandincreasedmarketorientationand(ii)morerecently,major port consolidation ‐ and governmental responses to ensure Vancouverremains Canada’s busiest port and a central part of the country’s Asia‐PacificGatewayandCorridorInitiative.(APGCI)

I.PastasPrologue:Canada’sPortsDivestitureProgram2

TheearlyhistoryofCanada’sportswasoneofpublic investment,publicownershipandpublicmanagement.FromtheAtlantictothePacific,theArctictotheGreatLakes,hundredsofports,largeand smallwereestablishedandcameunder thepurviewof theGovernmentofCanada.Authoritycame from legislationsuchas theGovernmentHarboursandPiersAct, theNational

1KevinGinnellandPatrickSmith,DepartmentofPoliticalScience,SimonFraserUniversity,BurnabyBC,[email protected]@sfu.ca.Peter,oneofCanada’spre‐eminenturbanists,passedawayDecember27,2008andwillbegreatlymissed.

2ThemajorityofthisworkwasfundedbytheSSHRCC–MCRIprojectonMultilevelGovernance.ItformspartoftheresearchinBritishColumbiaon‘FederalProperty’.PeterOberlanderwasacentralpartofthisworkonfederalproperty,andamemberoftheBCMCRIresearchteam.Themapsincludedmaybeofinterest;theyareforPeter.



HarbourBoardAct,1936,andthe1964HarbourCommissionsAct.2.Bythe1980’s, therewerecloseto600‘portsites’underthecontrolofthefederaldepartment,TransportCanada.3Theseinvolved ownership/management by port commissions under the aegis of the federalgovernment.

By the 1980’s, however, new public management principles had begun to gain ascendancy,challengingthispublicparadigm.Therootsofthisre‐thinkingcameinthelate1950’swiththeMacPhersonRoyalCommissiononTransportation (Report,1961).4 Thelongtermresultofthischange inphilosophywasthatamajorityofCanadianportsweresystematicallydivestedfromdirect federalmanagement during the 1990’s and 2000’s and took onmoremarket‐orientedforms.5VariousFederalGovernments(LiberalandConservative)cametoviewpublicownershipandmanagementasstiflingcommerceandcompromisingCanada’sglobalcompetitiveness.Theperceivedinefficiencyof‘public’portsledtoaproactivepolicyofsignificantfederaldivestiture.6ItalsoproducedparallelpressurestoconsolidatethelargestCanadianports.Withregardtothedivestiture program – started in 1996 ‐ by the end of 2006, Canada had ‘transferred, de‐proclaimedor terminated its interest in466of the549ports identified for suchdivestiture7–underwhat began as the federal government’sNationalMarine Policy of 1995 and the PortsDivestiturePlan,1996andlaterwhichbecametheNationalMarineAct(NMA)ofJune1998.ByDecember,2008,472ofthe549PortsProgramsfacilities“hadbeentransferred,demolishedorhad had their public harbour status terminated.”8 For many of the remaining ports acrossCanada, especially smaller ones, the holdup often has been one of First Nations claims orquestions about responsibility for ongoing liabilities – either of these creating a hiatus infinalizing the remainder of the federal port divestiture plans. Port Stanley, on Lake Erie inOntarioisagoodexampleofthelatter:inPortStanley,prioroil/fuelandothercontaminationofthesoilattheportleftkeyquestionsaboutwhowouldberesponsibleforanyremediation.TheTransport Canada plan had been to divest Port Stanley to theMunicipality of Central Elgin –alongwith any future environmental liability. However, themunicipality was told that undertoughnewOntarioprovincialenvironmentalregulationsitwouldberesponsibleformillionsofdollarsincleanupcostsrelatedtoleachateanddrinkingwatercontamination,etc.Indeeda‘fullremediation’ vs. to less onerous ‘industrial standards’ would be necessary for any new non‐federalowner.PortStanleyremainsoneofthe‘non‐divested’portsofCanadaasaresult.9

Theearly rootsof thepush formoremarketcompetitionandtheNationalMarineActcanbefoundintheworkoftheMacPhersonRoyalCommissiononTransportation(1958‐1961)whichconsideredthegovernment’scontrolovertransportationand“industrystructure,conductandperformance” and advocated inter‐modal competition amongst Canada’s transportationsystems, systematic de‐regulation of rate setting and the use of national transportationinfrastructuretofurtherthecountry’seconomicsuccess.10TheCommission’sfindingsultimatelyled to the passage of theNational Transportation Act (1967), which set out a new nationaltransportationpolicy.11WhatMacPhersonhadrecommendedwasmaximizingefficiencyacrosstheCanadiantransportationsystemwithmorecompetitionviamarketmechanisms:

Public action … in developing a National Transportation Policy must seek toencouragecompetitiveforceswherethestructureofindustrypermitspervasiveandeffectivecompetitiontooperate,andtoregulatewhereitdoesnot.12



The National Transportation Act of 1967 contained this move to market principles. Thislegislativeactionwasfollowedintheearly1980’sbytheCanadaPortsCorporationAct(1983),movingports toCrownCorporation – andmore arms‐length – status.13 In 1996, theChretienLiberalGovernmentinitiatedthePortsDivestiturePlan.Initially,asix‐yearprogramtoeliminatefederal port responsibilities across much of the system, it was extended in 2002 for anadditionalyear;thenextendedagain–forthreeyears–to2006;atpresent,itcontinuersunderathirdextensionbytheHarperConservativegovernment.14Thisprogram–andthecontinuingpushforaclearermarketmodelforCanada’sports‐addedlegislativeformundertheNationalMarineActof1998(NMA),anotherChretieninitiative.

TheNMA“soughtthemodernizationofthemarinemanagementandregulatoryregime,lessredtape, and greater efficiency and effectiveness in the marine transportation sector.” The Actcalled for a shift in the “financial burden of marine transportation to the system users, areduction in excess infrastructure, and [to] place facility operations in the hands of localusers.”15UndertheNMA,Portsshiftedfromtheirfederalcrowncorporationstatus(undertheCanada Ports Corporation Act, 1983) to new Canada Ports Authorities (CPA).16 As part of theNationalMarineAct,theCanadaPortsCorporationActof1983wasreplaced,andamendmentsmadetotheNationalHarboursBoardActof1936,theGovernmentHarboursandPiersActandthe1964HarbourCommissionsAct.17

Through the NMA, the federal government sought the “achievement of local, regional andnational social and economic objectives and (to) promote and safeguard Canada’scompetitiveness and trade objectives.”18 The government cited “over‐capacity andinefficiencies” inthesystemas justificationforremovingthecontrolofthePortsfromCanadaPortsCorporation to localBoardsofDirectorsundernewPortAuthorities.At the time,DavidCollenette,federalTransportMinisterstatedthattheCMAwould“makeiteasierforports,theSeawayandpilotageservicestooperateaccordingtobusinessprinciplesandallowmore localinputintothedecision‐makingprocess.”19

ThePortDivestitureProgram(PDP),beguninApril,1996wascentraltotheNMAct;apartfromendingfederalinvolvementinthemajorityofsmallerports,itcreated18majorPortAuthoritieswiththeirownspecificLettersPatent.20Theoriginalsix‐yearPortDivestitureProgramhasbeenextendedthreetimesto2009.Asnotedearlier,theneedforextensionswascausedbyfactorssuch as “issues relating to First Nations land claims, jurisdictional impediments, andenvironmentalconcerns”–asinPortStanley,Ontario,orTsawwassen,BC.21

Portswerecategorizedintwoways‐eithertheywereofmajorimportancetothecountryandwerere‐constitutedas“Authorities”ortheywereoflocalimportanceorsurplusandwouldbedivested,demolishedorhave theirpublicharbourstatus terminated.At theendof fiscalyear2004‐2005, fully 459(84percent) of the 549 public ports and public port facilities hadcompletedthePortDivestitureProgram.22

The Port Divestiture Program has followed a “land and chattels transfer strategy” to ensurecertainfederalbenefits:

• no offer that leaves the Crown financially worse off as a result of divestiture will beaccepted;



• theCrownreceivesthebestvalueforportlandandotherassets;

• anewportownerwillnotenjoyanywindfallprofitsfromthesubsequentsaleoflands,assetsand/orchattels;and

• TransportCanadafullyupholdsitsfiduciaryresponsibilitywithrespecttoFirstNations.23

Transport Canada initiates the port divestiture process under this strategy after consideringwhetherthereareanyotherfederaldepartmentsorprovincialgovernmentagenciesinterestedinoperatingthefacility.Ifthereisnosuchinterest,asixstepprocedureisundertaken:

a.TransportCanadaregionalofficialsholdpublicmeetingstodiscussdivestiturewithlocalinterests.

b. Local interests then forma legalentity,which signsanon‐binding LetterofIntent to negotiate the port transfer and a legally binding Disclosure ofInformation Agreement with Transport Canada to protect third – partyinformation.

c. Transport Canada provides the local entity with financial data, traffic ortonnage statistics, and any other relevant information concerningenvironmental,technical,engineering,andpropertyorleasingissues.

d.The localentityconductsaduediligenceprocess,usuallywithfundingfromTransportCanada.

e.TransportCanadaandthelocalentitynegotiatefinancialandotherconditionsoftransfer.

f.Bothpartiessignthetransferagreement.24

AspartofTransportCanada’sevaluationofthedivestitureprogramin2003,asavingsof$110million had been realized by the department based on a reduction of expenditures by $284millioninportsoperationsandmaintenance,plusproceedsof$8.4millionresultingfromportsbeingsoldoutrightminus$182milliondisbursementaspartofthePortsDivestitureFundwhichwasintendedtoimproveportsinfrastructurepriortodivestiture.25

The NMA underwent a mandatory five year review in 2003; this resulted in a set ofrecommendationsencompassedinBillC‐61whichwasintroducedinParliament(bytheMartinLiberalGovernment) in June 2005, in order to “fine‐tune the existing provisions andprovideCanadaPortAuthorities(CPAs)withaccesstofederalfundingforcertaininfrastructureprojects(to a capped amount) and national security.” This Act died on the order paper inNovember,2005withthefederalelection‘call’.26

Canadiangovernments–bothLiberalandConservative‐undertookthissystematicdivestitureprogram of Canada’s ports beginning in the mid‐1990’s passing off ownership and/oroperational responsibilities of ports to a variety of provincial,municipal and non‐governmententities.OperationalauthorityoverthePortofVancouverwasshiftedfromtheVancouverPort



Corporation(VPC)toanevenmore“armslength”agency,theVancouverPortAuthority(VPA).The Port remains under the ownership of the Crown; while operations have been divested,ownershiphasnot.

The VPA was an interesting example of the shift to New Public Management whereby anappointed Board ofDirectors became responsible for the overallmanagement and long termdevelopment of the Port with a goal of economic maximization; the federal government ‐throughTransportCanada‐maintainsa“hands‐off”approachanddoesnotexerciseanydaytodayoperationalcontrol.

IfFewerIsBetter,BiggerIsToo:PortConsolidationinVancouver

ThePortofVancouverhasbeenCanada’sbiggestandbusiestformanyyears.

Map1:PORTOFVANCOUVER(priorto2008)



IthasbeenoneofthebusiestintheAmericas.27UptoitsJanuary2008‘consolidation’withthetwoothermajorregional(FraserRiver)ports,thePortofVancouverconsistedof247kilometresof coastline ranging from Roberts Bank at the U.S.‐Canada border, along the south shore ofBurrardInlet,upIndianArmandthenorthshoreofBurrardInlet.TheAuthorityoversaw6,000hectares of water and 460 hectares of land occupied primarily by cargo terminals.Imports/Exports through the port totaled 76.5 million tonnes in 2005 with a value ofapproximately$43billion.ThePortwasthehighestvolumeexporterinNorthAmerica,andontheWestCoastofNorthAmerica.Italsorankednumberoneintotalcargovolume.InCanada,itrankednumberoneintotalcargohandledandnumberoneintotalcontainerthroughput.28

ThePortwascomprisedof“25majormarinecargoterminalsthatcollectivelyoffered56berths,superpost‐Panamaxcapacityandextensiveon‐dock rail facilities.”29 Port activities generated$4billionintotalGrossDomesticProduct(GDP),$8.9billionintotaleconomicoutputandmorethan$763millionintaxcontributionstoalllevelsofgovernment.30

ThePortAuthorityhadthreewholly‐ownedsubsidiaries–

1. CanadaPlaceCorporation(CPC)‐overseeingtheCanadaPlace

tourism/business/conventionspace

2. PortVancouverVenturesLtd.(PVV)‐thePort’sinvestmentarm

3. PortVancouverHoldingsLtd.–thePort’spropertyholdingcompany

Employingover62,000peopledirectly,thePortconsistedof17bulk,3container,2cruiseshipand3generalcargoterminalsthatwereservicedbytheCanadianNational,CanadianPacificandBurlingtonNorthernRailways.In2005,thePorthandled1,767,379containersandhosted2,677foreign vessel arrivals. The majority of exports from the Port emanated from theWestern/Prairie provinces and – consistent with the Asia Pacific Gateway Initiative –overwhelminglywenttoAsia(66%),aswellastoLatin/SouthAmerica(13%)andEurope(11%).Theseexportsprimarilyconsistedofnaturalresourcesincludingcoal(25milliontonnes),grains(8.4 million tones), wood pulp (4.3 million tonnes), sulphur (6.1 million tones), potash (5.9milliontonnes),chemicals(2.2milliontones),andpetroleum(1.2milliontones).31

ThePortalsodevelopedacruiseshipbusinessasthehomeportfortheVancouver‐Alaskacruiseroute. In2005, justunderonemillion (910,172)passengerson33 cruise ships from16 cruiselinesused thePorton272 sailings to/from thePort generating$1.4billion ineconomic inputand$2millionpersailingtothelocalandregionaleconomiesofBritishColumbia.32

Historically, the Port of Vancouver has represented Canada’s Pacific Gateway: in 1987, forexample, five of the top ten destinations of Port of Vancouver exports were to Asia Pacificnations; this represented fully 83.6% (34millionmetric tons) of suchexports.33 By 2006, thePortofVancouverwasnow‘NorthAmerica’sgatewayforAsiaPacifictrade’,thebusiestinNorthAmericaintotalforeignexports–‘$43billionintradewithmorethan90tradingeconomies’and‘ranked#2intotalcargovolume–73.6milliontonnes,andthebusiestonthewestcoastoftheAmericas.’34



Globalization and competitiveness concerns, as noted in Section I above, had pushed federalauthoritiesandthePorttoconcludethatasbigasthePortofVancouverwas,marketadvantagewould improve if itwasmade even bigger. This occurred in January, 2008,when the Port ofVancouverwas amalgamatedwith the twoother significant regional river Portsof Fraser andNorth Fraser.35 Collectively, this new Port Authority of Vancouver Fraser is nowmarketed asPortMetroVancouver.

Ineconomicterms,amajorNovember,2008studybyInterVISTASidentifiedtherecentimpactsofPortMetroVancouveronthelocal,BCandCanadianeconomies:

132,700totaljobsacrossCanada

Port‐related activities generate $10.5Billion in GDP, $22Billion in economicoutputand$6.1Billioninwages

PortMetroVancouverborderson16MetroVancouvermunicipalities

PortMetroVancouvercovers600kms.ofshoreline

PortMetroVancouverhosts28majormarine terminals,plus severaldomesticintermodalterminals

Port Metro Vancouver’s main sectors include maritime cargo (generating$2.2Billion inwages) and the cruise ship industry (providing 5,700 direct jobsand@$200Millioninpayroll.Cargovalueannuallyisnowat$75Billion

Port Metro Vancouver provides 45,000 regional jobs in Greater Vancouver(3,000inDelta,5,600ontheNorthShoreandover20,000inVancouver)

Port Metro Vancouver generates just under a $1billion ($970Million) in taxrevenues to all levels of government annually ‐ including $657Million to theFeds

ThePortalsoanticipates$4.5Billioninnewinfrastructure/buildingoverthenext10 years – and capital spending of $95Million annually plus Port partner/userpartnerspending

PortMetroVancouverisCanada’slargestandNorthAmerica’smostdiversifiedport, trading $75 billion in goods with more than 130 trading economiesannually.36



Map2:Port Metro Vancouver: Former Jurisdictions, Now Combined

ThereareanumberofintersectsbetweenthefederalPortsDivestitureprogram,thepolicypushtomoremarketorientationandthePortMetroVancouverconsolidations.TheVancouverPortAuthority(andnowPortMetroVancouver)remainsresponsibletotheGovernmentofCanadathroughTransportCanadaandexistsunderLettersPatentissuedbytheGovernor‐in‐CouncilonbehalfofTreasuryBoardandTransportCanada.TheVancouverPortAuthority’s(VPA)BoardofDirectorswascomprisedofninemembersservingthreeyeartermsappointedbythemunicipal,provincial and federal governments and approved by the Minister of Transport. The VPA’sBoard first met on March 1, 1999, on a day the VPA called an “auspicious and promisingbeginning.”37 The Authority was a non‐shareholder, for‐profit corporation governed by theBoardwhichappointsaPresidenttooverseedaytodayoperations.TheBoardofDirectorsalsoformed three standing committees – Audit Committee, Human Resources and CompensationCommittee,andGovernanceCommittee.38

TheBoardofDirectorshadsignificantlocalauthorityandresponsibilitiesfortheoperationanddevelopmentofthePort,however,itwassubjecttofederalgovernmentrestrictionsonthesaleof property, the amount ofmoney it could borrow and on governance issues. Under LettersPatent,theAuthoritypaidthefederalgovernmentastipendbasedonapercentageofitsgrossrevenue, in 2005 this amounted to close to $4million.39 Supplementary Letters Patent wereroutinelygranted inorderto facilitatePortexpansion,changes ingovernance,borrowing limitincreases, etc. The Port of Vancouver, between 1999 and 2006, received 15 Supplementary



LettersPatentinordertoacquireproperty,increaseborrowinglimitsandchangethelengthoftermsfordirectors.40

The Board of Directors has exerted considerable control over the Port since divestiture;however, the Board identified several issues that remained to be improved concerning therelationship between the Federal Government and the Authority. The Authority specificallyarguedforchangesinthefollowingareasaspartoftheCMAfiveyearreviewin2003:

1. Loweringborrowingcosts–theVPAsuggestedthatthroughutilizationofprivatesectorinvestment, using such tools as tax‐exempt bonds, port authorities would have theabilitytolowerborrowingcosts.

2. RetentionofProceedsfromtheSaleofPortLands–theVPAarguedforthesettingupofan investment trustderived fromthesaleofport lands foruse in the future for“landacquisitionandinfrastructuredevelopment.”

3. Endingpayments‐in‐lieu‐of‐taxestomunicipalities–theVPAsoughttohavethefederalgovernmentreconsiderthefeesthatportauthoritiespaytomunicipalitiesarguingthatitisthefederalgovernmentthatusuallymakessuchpayments.

4. RemovalofAnnualStipendPaymentstotheFederalGovernment–theVPAsuggestedthat increased investment at the local levelwould occur if user fees collected by thePort were allowed to be re‐invested locally rather than port authorities having toremunerateapercentageoffeescollectedbytheporttothefederalgovernment.41

TheVPAwas largely supportiveof the findingsemanating fromthe fiveyear review (releasedJune 4, 2003) viewing them as “extremely positive.” Many of the wholesale changes to theCanada Marine Act called for by the VPA have not occurred because the initial enablinglegislation (Bill C‐61)diedon theorderpaper inNovember, 2005. TheVPAhas continued tolobby for legislativeaction to implement the recommendationsof the reviewpanel.42Despitethe lack ofwholesale legislative action, specific VPA initiatives regarding financing have beenundertaken through the Supplementary Letters Patent process, however, the current Harpergovernment is still reviewing the CMA as it considers the future of marine transportation inCanada.43Intheinterim,completingthePortDivestitureplancontinuesasthepolicynorminto2009.

In the VPA’s 1999 Annual Report David Stowe, the first Chairman of the Vancouver PortAuthority, called the divestiture of the Port of Vancouver “seamless,” however, there wereissues raised particularly by the City of Vancouver and other local stakeholders throughoutdivestiturethatneededtobeaddressedand/orarestillbeingaddressedonanongoingbasis.

Specifically,theCityofVancouverhadreservationsaboutdivestitureinfourmainareas:

• Policing – Councilwas concernedover the types of policing services thatwould be inplaceunderthenewAuthority,whowouldprovidesuchservicestothePort,andwhatwouldbethesourceoftheirfunding..



• TaxationRevenue–Citycouncilwasopposedtotheportpayingfeesforserviceratherthangrants‐in‐lieuofproperty taxes.Council feareda lossof revenueandquestionedwhether an appropriate fee structure could be determined and ultimately collectedunder the new system. Framing this area of concern was the Port’s historic lack ofpromptnessintheannualpaymentofgrants‐in‐lieuofpropertytaxes.

• Local Representation on and Accountability of the Port’s Board of Directors ‐ Citycouncilwas apprehensive that thenewgovernance structure of the Port consistedofonly one municipal representative and argued that in order to maintain communityinputandlocalaccountabilityaminimumoffivemunicipalrepresentativesshouldbeinplaceontheBoard.

• LandUseandDevelopment–Councilrecognizedthehistorical cooperationonlanduse issues between the Ports Corporation and the City and urged the federalgovernmenttorequirethenewAuthoritytoseekfederalapprovalpriortoencroachingonmunicipallanduseprocessesandtoallowauthoritiestoenterintobindinglanduseagreementswithmunicipalitiesrecognizingfederalconstitutionalprerogative.44

Former CityManager (and subsequent Deputy to the BC Premier) Ken Dobell, in a report toVancouverCouncil,labeledtherelationshipbetweenthePortandCityofVancouveras“varied”,identifyinglanduseissuesasbeinganongoingsourceoffriction.Dobellsupportedtheideaofformalizing the relationship between the City and Port in a manner that recognized theindependenceofeachjurisdictionandresponsibilitiesofbothentities.45Thedesiretoenterintoa more formal relationship between the Port and City resulted in the signing of the Port ofVancouver/City of Vancouver Charter which sought to identify areas of common interest, toimprove communication, set up a dispute resolution mechanism and simplify the legalrelationshipbetweenthetwobodies.46Specifically,theChartersoughttoaddressthefollowingPort/Cityissues:

a) promotionofthebusinessofthePort

b) enhancementofthemarineenvironment

c) provisionofaccesstothewaterfrontandactivitiesof thePort forcitizenswherethisisconsistentwiththeworkofthePort

d) effectivemanagementoftheuseoftheharbour,includingrecreationalusewherethisisconsistentwiththeworkofthePort

e) provision of effective road and rail access and utility services for theefficientoperationofthePort

f) provisionofaccesstowaterfornecessarycityutilityservices

g) provision of effective policing and emergency services in the Port andadjacent area of the City, including emergency planning and disasterresponse47



The City of Vancouver/Vancouver Port Authority Charter formed the backbone of theCity/Authorityrelationshipsincedivestitureandhasresulted inconsultativeprocessessuchasthose currently surrounding East Vancouver Port lands development. Several other borderingmunicipalitieshavealsoenteredintoCharterarrangementswiththePortwiththeoverarchingintention of mitigating any possibility of negative relationships developing between the PortAuthorityanditsneighbours.48Inmanycases,municipal–andpublic–accesstothewaterfrontisacentrallocalconcern.49ThisoftenrancountertoPortdevelopmentplans.

Under the CMA, the Port has the “authority and responsibility to approve developmentproposals for its lands”, while under provincial law the City has “authority to approvedevelopment applications on any lands located within its municipal boundaries that are notsubject to Provincial or Federal jurisdictions.”50 The process of solving municipal/port issuessincedivestiturewouldhavebeenmuchmoredifficultwithouttheunderstandingscontainedinsuchPort/CityCharter.

In multilevel governance terms, there have been a broad range of entities involved – bothgovernmentalandnon‐governmental.Theseincludethefollowing(seeTable1):

Table1:GovernmentAgencies

FederalGovernmentCabinetTreasuryBoardMinistry of Transport,InfrastructureandCommunitiesTransportCanadaDirectorGeneralPortProgramsandDivestiture DivestitureSecretariat/HQ RegionalDirectorsGeneral RegionalDivestitureTeamsCanadaPortsCorporationPublic Works and GovernmentServicesCanada(PWGSC)DepartmentofFinanceDepartmentofJusticeDepartmentofEnvironmentDepartment of Fisheries andOceansDepartment of IntergovernmentalAffairsDepartment of Indian andNorthernAffairs

ProvincialGovernmentCabinetTreasuryBoardDepartment ofTransportationMinistryofEnvironmentMinistry ofIntergovernmentalAffairsMinistry of AboriginalRelations andReconciliation

MunicipalGovernment=16CityofVancouverCityofBurnabyCityofPortMoodyPortCoquitlamVillageofAnymoreVillageofBelcarraDistrict of NorthVancouverCityofNorthVancouverDistrict of WestVancouverCorporationofDeltaCityofRichmondCityofSurreyetc

Other Entities/SocialActorsFirst Nations – several –including those with newTreaty relationships suchasTsawwassenVancouver PortCorporationGovernments of Alberta,Saskatchewan,ManitobaGreater VancouverRegional District (MetroVancouver)VancouverBoardofTradePortUserGroupsPortUnionsCanadaWheatBoardetc.



MultilevelGoverningLessons

TheAsiaPacificGatewayandCorridorInitiative,thePortsDivestitureProgram,andPortMetroVancouver consolidation, each represent good examples of multilevel governance. On thegroundlocally,inGreaterVancouver,partoftheGatewayprojectinvolvesmajorroads/rail(andportlinks)construction.InMetroVancouverthishasnotbeenwithoutcontroversy:theGVRD’sLivableRegionStrategicPlan(LRSP)ofthe1990’sanditssuccessorSustainableRegionInitiative(SRI),havebeenpremisedonlesseningtheregion’sdependenceoninternalcombustionengineuses to “get around”.51 Meanwhile, well before the late 2008 economic “correction”, theprovincial government, together with the feds, had been working to counter this regionalsustainability themewithmajor highway construction and bridge/highway/rail twinnings – allundertherubricof‘Gateway’.AsrecentlyasmidJanuary,2009,PrimeMinisterStephenHarperandBCPremierGordonCampbellmetattheFraserSurreyDocks(nowpartoftheconsolidatedPortMetroVancouver)toannounce$1Billioninfederal‐provincialfundingforonepieceoftheregionalGatewayroadconstruction.($635MillionfromBC/$365Millionfromthefeds)forthe40km.‘SouthFraserPerimeterRoad–linkingtheFraserValleyandtherestofBC/CanadawiththeFraser/Deltadockfacilities(byroadaswellasexpandedrailservice).52FortheBCPremier,this11‐year construction project (2010‐2021) was to “build BC’s economic competitiveness bystreamlining themovementofgoodsandpeopleandensuring thatwecan tap into the tradeopportunitieswiththeAsia‐Pacific….(It is)partofBC’sGatewayProgramandtheGovernmentofCanada’sAsia‐PacificGatewayandCorridorInitiative.”53

As the same Vancouver‐area announcement, Canada’s Prime Minister emphasized theincreased“efficiencythroughCanada’sAsia‐PacificGatewayandCorridor”–aninitiativestartedbythefeds inOctober,2006.54ThePrimeMinisternotedthattheBC’scontributiontovariouscomponents of this Gatewaywas $3Billion.55 The APGCI is to “bring together infrastructure,policy,governanceandoperational issues inan integrated, intermodal,public‐private strategyto strengthen Canada’s competitive position in international commerce with the Asia Pacificregion. To establish Canada’s Pacific Gateway as the best transportation network facilitatingglobalsupplychainsbetweenNorthAmericaandAsia,Canadaisexploring…innovativewaystodeepentradeandtransportationlinkswithemergingeconomiesintheAsiaPacificregion.”56

Vancouver‐areamunicipalitieshaveremainedmoreambivalentplayers;some,suchasinnercities like Vancouver, Burnaby and NewWestminster, oppose the road expanding aspects ofGateway;anditcontinuestoruncountertoofficialGVRDpolicy.Other,generallyouter–andsouthofFraserRiver‐municipalitiessuchastheLangleys,andSurreyaremoreinfavour,seeingasolution–howevershort‐term‐totheircommutingnightmares.



Map3.MetroVancouver

Private actors – such as truck haulers associations and local Boards of Trade, and quasi‐public/privateentitiessuchasthePortalsohavebeenstrongGateway–andportconsolidation–advocates.

Collectively,thelinkagesbetweentheAsiaPacificInitiative,DivestitureandConsolidation,offermultilevelgoverninglessons.Inconstitutionalterms,theprovincehasprimaryresponsibilityformost infrastructure; such investment generally involves municipal or regional partners.Generally–aswiththeSouthfraserPerimeterRoad‐considerablefederal$‐fundsareneededtomovesuchprogramsforward,andmajorPortsremainunderfederaloversightandultimateownership.Intermsof‘socialforces’,inBritishColumbia,fewsuchmajorprojectsdonotraisequestions about FirstNation relations, even claims toownership/title. The influenceof actualand potential land claims and treaty negotiations during the ongoing implementation of PortdivestitureandconsolidationinVancouverisacaseinpoint.

A local example of First Nation influence is the current relationship between Port MetroVancouverandTsawwassenFirstNation (TFN). ThePort’sRobertsBank facility lieswithin thetraditionallandclaimedbytheTFN–intheVancouversuburbofDelta.(SeeGVRDMap3)TheTFNhadtakentheGovernmentofCanada,theGovernmentofBritishColumbiaandVancouver



Port Authority to court seeking compensation for development of Roberts Bank and plannedfuture expansion of the container facility. In 2004, the then‐VPA and Tsawwassen signed aMemorandumofAgreementwhichcompensatedfor“pastinfringementsontheTFN’sclaimedlandandsought“compensationandmitigation”foranyVPAfutureexpansionthataffectedTFNland which effectively settled the court cases. 57 In December, 2007, the Tsawwassen FirstNation,theGovernmentofBritishColumbiaandtheGovernmentofCanadasignedafinaltreatyagreement covering taxation, financial compensation, natural resources, fishery, certainty,governance and (most importantly re: Gateway) lands. As the FN lands are adjacent to PortMetro Vancouver’s Deltaport – the terminus of the South Fraser Perimeter Road (+ rail)expansion ‐ AND much of this same land has been subject to development limits via theprovincial Agricultural LandReserve, it has produced its own set of provincial and local/Deltacontroversies.TheTFNwishtoenterintoaPortagreementtodevelopsomeoftheirlandsforport‐relatedactivityandlocaljobs.Theywilldoso,asprovidedforintheirnewtreatyandundertheirtitle,butnotwithoutconsiderablepoliticalcontestationaroundthePort,theAgriculturalLandCommission,thetreatyprocessandtheirneighbouringmunicipality.

Have thevariousactorscollaboratedwitheachother?Thenatureof thecollaborationamongthevariousactorsislargelyrelatedtothestageoftheprocess.Therewaslittleimpetusforthefederal government to collaborate much with other actors aside from the Vancouver PortsCorporation in the planning and decision‐making and initial aspects of the implementationstages of the process of divestiture to consolidation. The macro‐goal of divestiture (andsubsequently major port consolidation) in order to maximize economic benefit was a policydevelopedoverseveralfederalgovernmentssincetheMacPhersonCommissionin1961.

The Federal government, the Provincial government, the City of Vancouver (and relatedmunicipalities) and the port authority worked together, out of necessity, to facilitate theexpansion of the port as part of the Pacific Gateway Initiative during the implementationphase.58 In 2005, the Province provided $2.5 million in property tax relief for port terminaloperatorstoencourageexpansionefforts,$400millioninroadinfrastructureinsupportoftheport and other regional transportation modes and $2.5 million in funding for furtherdevelopment of the port’s cruise ship business. 59 Along with the feds, BC continues tocontributeseveral$billionforGateway

ThecollaborationbetweenmunicipalofficialsandportofficialshasalsobeenheightenedsincetheshifttoanAuthoritymodel.Priortodivestiture,municipalofficialswerecollaboratingwithPorts corporation officials that directly reported to the federal bureaucracy/Minister. SincedivestituretherehasbeenenhancedcollaborationbetweenmunicipalitiesandthePortmostlyconcerningfuturelanduseplansandprovisionofinfrastructureinsupportofPortoperations.60

ThenatureofthemultilevelcollaborationhaschangedasaresultofchangestothePortform‐asthePortAuthorityisnotrequiredtoseekTransportCanadaintervention/assistanceinmostdecision‐making, implementationofstrategyand futuredevelopment initiatives.Theability todirectly act without seeking permission from department higher‐ups on every issue lessensbureaucraticentanglementsandenhancestheabilityofthePorttoactquicklyinsituationsandmany local actors (governmental andnon‐governmental) feel better able to conduct businesswiththePort“facetoface.”



Toimplementitsnewmandate,inlateNovember,2008,PortMetroVancouveradvertisedforaPresident and Chief Executive Officer. Amongst the new CEO’s duties are to “continue thepursuitofthePacificGatewayStrategy,collaboratewithgovernmentalofficialsatalllevelsandpromoteabroader commitment tobuilding relationswithneighbouring communities.”61 ThatcollaborationseemscentraltoPortMetroVancouver’scurrentvision. Inan8‐pageinsert intoVancouver’s major newspaper, The Vancouver Sun, the Port’s insert title was simply:“CollaborationiskeyforCanada’sPacificGateway”–andanextensivedescriptionofwhateachofthethreeamalgamatingportsbroughttothetablewithconsolidation.

Port Metro Vancouver remains Canada’s biggest and busiest port. It is a central part of thecountry’sAsia‐Pacificoutreach.AsEvansargueselsewhereinthisvolume,itislikelytoremainamajor componentofVancouver,BCandCanada’sposition into the seconddecadeof the21stcentury.

Endnotes

1 Port Metro Vancouver now encompasses 16 municipalities and over 600kms of waterfront with 28majormarine terminals and several domestic intermodal terminals inGreaterVancouver. It trades$75billion in goods with over 130 countries annually. It represents $10.5billion in GDP and$22.2billion in economic output; it also ‘supports’ 132,700 jobs across Canada, and $6.1billion inwages ($200million locally). See InterVistas Consulting Final Report: 2008 Port Metro VancouverEconomicImpactStudy,(Vancouver:PortMetroVancouver,November25,2008).

2Governmentof CanadaDepartmentof Transport, “TransportMinister IntroducesCanadaMarineAct,October 2, 1997, <http://www.tc.gc.ca/mediaroom/releases/nat/ 1996/96_h081E.HTM>bid.(Accessed,July3,2008)

3InformationprovidedtoauthorsbyTransportCanada,December10,2008.4 For some early discussion of transportation aspects of this see John Baldwin, “The Evolution of

TransportationPolicyinCanada”,CanadianPublicAdministration,vol.20,no.4,1977,pp.600‐31.5See, forexample,RexfordSherman,SeaportGovernance IntheUnitedStatesandCanada,(Alexandra,

VA.:AmericanAssociationofPortAuthorities,2006).6 Vancouver Port Authority, Annual Report, 2004‐2005, <http://www.tc.gc.ca/

programs/ports/annualreport0405.htm>February11,2007.7 SeePress Release: Canadian Port Industry, (Alexandra, VA.: AmericanAssociation of Port Authorities,

2006).ByDecember,2008,fully472ofthislisthavebeendivested.(InformationprovidedtoauthorsbyTransportCanada.December11,2008.

8InformationprovidedtoauthorsbyTransportCanada,December10,20089 On Port Stanley’s ongoing issues with port divestiture and Transport Canada see Francie Dennison,

“AnswersfromTransportCanada”,PortStanleyNews,December9,2008.10 (MacPherson) Royal Commission on Transportation, Final Report, 1961); See also, Canadian

Transportation Agency First Annual Report July 1 to December 31, 1996, <http:www.cta‐otc.gc.ca/publications/ann‐rpt/1996/ann_rpt_1996_e.pdf>February11,2007.

11Ibid.12MacPherson)RoyalCommissiononTransportation,FinalReport,1961.13GovernmentofCanadaDepartmentofTransport, “TransportMinister IntroducesCanadaMarineAct,

October 2, 1997, http://www.tc.gc.ca/mediaroom/releases/nat/ 1996/96_h081E.HTM (AccessedOctober12,2008)

14InformationprovidedtoauthorsbyTransportCanada,December,18,2008.



15GovernmentofCanadaDepartmentofTransportEvaluationServices,“EvaluationofthePortDivestitureProgram Final Report,” September, 2003, <http:www.tc.gc.ca/programs/ports> Accessed February11,2007.

16GovernmentofCanada,DepartmentofTransport,“TransportMinister IntroducesCanadaMarineAct,October 2, 1997, http://www.tc.gc.ca/mediaroom/releases/nat/ 1996/96_h081E.HTM (AccessedOctober12,2008

17Ibid.18 Government of Canada, Canada Marine Act, 1995, <http://www.tc.gc.ca/acts‐

regulations/GENERAL/C/cma/act/cma‐a.html>February11/07.19GovernmentofCanada,DepartmentofTransport,October2,1997,PressRelease..20Ibid.21GovernmentofCanadaDepartmentofTransportEvaluationServices.September,2003.22VancouverPortAuthorityAnnualReport,2004‐2005.23Ibid.24 Government of Canada Transport Canada. Annual Report 2004‐2005,

<http://www.tc.gc.ca/programs/ports/annualreport0405.htm>February11,2005.25TransportCanadaDepartmentalEvaluationServices,September2003.26GovernmentofCanada,DepartmentofTransport,AnnualReport2004‐2005.27 See, for example, Theodore Cohn, DavidMerrifield and Patrick Smith, “North American Cities in an

InterdependentWorld:VancouverandSeattleasInternationalCities”inEarlFry,LeeRadebaughandPanayotisSoldatos,eds.,TheNew InternationalCitiesEra: TheGlobalActivitiesofNorthAmericanMunicipalGovernments,(Provo,Utah:BrighamYoungUniversity,1989),pp.73‐118.

28VancouverPortAuthorityAnnualReport,2004‐2005.29Ibid.30Ibid.31 Vancouver Port Authority, “The Port and Its Operations,”

<http:www.portvancouver.com/the_port/cma.htmll>.32Ibid.33Cohn,MerrifieldandSmith,op.cit.,p.91.CalculatedfromPortofVancouverstatistics,1987.34Foramoreextensivediscussionofthis,onVancouver,seeP.J.Smith,“TheMakingofaGlobalCity:Fifty

YearsofConstituentDiplomacy:TheCaseofVancouver”,CanadianJournalofUrbanResearch,vol.1,no.1, June, 1992, pp.90‐112. On the significance of the Port of Vancouver, see also David Bond,“Sustaining the Metropolitan Economy” in P.J. Smith, H.P. Oberlander and T.Hutton, eds., UrbanSolutions To Global Problems: Vancouver, Canada, Habitat III, (Vancouver: University of BritishColumbia,Centre forHumanSettlements,1996),Ch12,pp.68‐71.And seealsoPortofVancouver,“Port Facts” @ www.portvancouver.com/media/port_facts.html (Accessed March 1m 2006); andPatrickSmith, “GlobalCity‐RegionPolicyOptions:TheCaseofCascadia”,KoreanLocalGovernmentReview,vol.7,no.3,2006.pp.143‐174.

35 Fraser River Port was Canada’s largest FreshWater Port and Auto Port (North America’s 3rd largestautoport),responsiblefor16,100directjobsand$2.8BillioninGDP;NorthFraserPortwasCanada’slargest Shallow Water Port, with 9,000 direct jobs and worth $23Million in GDP. These portsamalgamatedwiththeVancouverPortAuthorityonJanuary1,2008–asPortMetroVancouver.Portof Vancouver, “Collaboration is key for Canada’s Pacific Gateway”, Vancouver Sun, 8‐pageinsert,January,2008.

36 To view the complete version of the economic impact study go to /Pdf/Port Metro VancouverEconomic Impact Study FINAL REPORT (25Nov2008).pdf . See also Port Metro Vancouver, PressRelease: Study confirms Port activities generate 132,700 jobs, $10.5 billion in GDP, November 25,2008.



37 Vancouver Port Authority Annual Report, 1998‐1999,<http://www.portvancouver.com/about/docs/1999_annual_report.pdf>

38VancouverPortAuthorityAnnualReport,2004‐2005.39VancouverPortAuthorityAnnualReport,2004‐2005.40GovernmentofCanada,DepartmentofTransport,“LettersPatentandSupplementaryLettersPatentof

CanadaPortAuthorities,”<http:www.tc.gc.ca/programs/Ports/letterspatent.htm>41 Vancouver Port Authority, “A Stakeholder Update,” July, 2003,

<http:www.portvancouver.com/the_port/docs/cma_update_july_2003.pdf>March9,200742VancouverPortAuthority,“CanadaMarineActReview,”November2003,<http://www.portvancouver.com/the_port/cma.html>February20,2007.43GovernmentofCanadaDepartmentofTransport,“CanadaMarineActReview,”September14,2006,

<http://www.tc.gc.ca/pol/en/acf/cma/menu_e.htm>February20,2007.44CityofVancouver,“ReportonShiftfromPortsCorporationtoPortAuthority,”February19,1996.45Dobell,Ken,“RelationshipBetweentheCityandtheVancouverPortCorporation”June9,1998,Cityof

Vancouver.46Ibid.47Ibid.48VancouverPortAuthorityAnnualReport,2004‐2005.49InformationprovidedtoauthorbyBurnabyMayorDerekCorrigan,Feb.25,2008.50 Vancouver Port Authority, East Vancouver Port Lands Area Plan, January 2007,

<http://www.portvancouver.com/the_port/docs/EVPL%20Draft%20Plan%20Jan%202007>March20,2007.

51On this see, for example, “GreaterVancouver: l’exception canadiennemetropolitaine”, Patrick SmithandH.PeterOberlander,inEranRazinandPatrickSmith,editors,MetropolitanGoverning:CanadianCases, Comparative Lessons, (Jerusalem:HebrewUniversity of JerusalemMagnes Press, 2006), pp.153‐188 and Patrick Smith, “Even Greater Vancouver: Metropolitan Morphing in Canada’s ThirdLargest City Region”,* inWhoWill GovernMetropolitan Regions in the 21st Century?,Don Phares,Editor,[Armonk,NY:M.E.Sharpe,2009],Ch.13.

52LoriCulbertandMikeDeSouza,“HarperandCampbellpraise theirproject:Transportation–Leadersmeet at Surrey docks, cite benefits of $1‐Billion perimeter road”, The Vancouver Sun, Tuesday,January13,2009,p.A5.

53 See Premier’s Office, BC, News Release, “Construction Launched on South Fraser Perimeter Road”,January12,2009.

54 See Prime Minister’s Office, Government of Canada, Press Release – Backgrounder: South FraserPerimeterRoad,January12,2009@http://pmgcca/eng/media/asp.?id=2379.

55Ibid.56Ibid.57VancouverPortAuthority,“VancouverPortAuthorityandTsawwassenFirstNationSignMemorandum

of Agreement,” November 10, 2004, <http://www.portvancouver.com/media/news_20041110‐2.html>March20,2007.

58VancouverPortAuthority.AnnualReport2004‐2005.59Ibid.60Vancouver Port Authority, “Port Plan” <http://www.portvancouver.com/the_port/

docs/Port%20Plan_for%20web.pdf>March9,2007.61 “Executive Opportunities: President and Chief Executive officer, Port Metro Vancouver”, Ray and

Berndston,@http://rayberndston.ca/index.php?id=399&L=4&tx(AccessedNov.28,2008.)

Documents

Making Biggest Bigger: Port Metro Vancouver’s 21st Century