Regional board puts funding on track

NANAIMO – Regional District of Nanaimo approvs $945,000 to help restore passenger rail on Vancouver Island.

The Regional District of Nanaimo has approved financial support to help get passenger rail service back on track on Vancouver Island, despite opposition from some of the area’s directors.

A 9-8 split divided directors when it came time to vote on the Island Corridor Foundation’s request for funding Tuesday night. In the end, a weighted vote of 37 in favour to 24 against means taxpayers will be on the hook for approximately $945,000 in grant-in-aid money – providing that the foundation can produce a solid agreement from VIA Rail to reinstate passenger service.

The Island Corridor Foundation, a not-for-profit society which currently owns the E&N Railway, has already received a $15-million commitment from federal and provincial governments.

According to the ICF’s business plan summary, $20.4 million will cover the cost of upgrades to meet safety requirements to make passenger rail viable between Courtenay and Victoria, and originating out of Nanaimo.

Approximately $3.2 million of the remaining balance of that sum is being pledged by five local regional governments, including the RDN, and the ICF proposes to raise the rest through financing and community fundraising.

The ICF business plan also states it has developed the terms of an operating agreement with Southern Railway Vancouver Island, to operate the rail way once the rail lines and ties have been upgraded. The draft operating agreement is for a period of 25 years, and the expected investment by the railway company over 25 years is approximately $70 million, $21 million of which is expected in the first 10 years of the contract.

However, the region’s area directors, while in support of railway restoration, were not fully convinced that the ICF’s projected numbers add up.

“The amount of funds required to ensure a safe railway track is about three times more than what has been budgeted.  A full expenditure of the pledged funds ($15 million) will not result in a completely safe track, and there is no assurance that VIA Rail will provide a train unless the track is fully safe.  The result could be either the expenditure of the funds with no result, or a request for more funds for further work. Neither outcome is acceptable,” said Julian Fell, area F director.

Fell said he would have liked to have seen a commitment from the province to fund the rail way through carbon tax, rather than a one-time grant.

Dave Willie, representing the Town of Qualicum Beach, voted against the request, saying he is skeptical that the freight industry on Vancouver Island will be able to generate enough money to sustain passenger service.

“To suggest that a freight business that’s doing less than a million dollars a year now can somehow, over the next 20 years, gather $100 million to start repairs and recapitalization of this line is totally unrealistic,” he said.

Voting in favour of the funding were all seven City of Nanaimo representatives, as well as RDN board chairman Joe Stanhope (Area G) and Brian Dempsey (District of Lantzville).

City of Nanaimo director Ted Greves, who represents the regional district on the ICF board of directors, pointed out the initial railway upgrade plan received commendation from professional engineer Gary Smith, director of engineering services and maintenance of way for Southern Railway, as well Eric Samuelson, provincial railway safety manager of the British Columbia Safety Authority.

“It’s a lot of money, but we are the last regional district to sign off. And I am holding Graham Bruce to his previous statement. It’s a one-time ask and I will not be voting for any more funding for the ICF after tonight,” Greves said.

Nanaimo Mayor John Ruttan said the window of opportunity to save rail on Vancouver Island is limited, and that the federal and provincial commitment of $15 million will not be on the table long.

“They’re going to want a timely decision and if we don’t make that decision now, that money’s gone,” he said, adding that the train service has not been given a fair chance.

“CP [Canadian Pacific Railway], with all my respect for that company, really didn’t make a determined effort to keep that rail going.”

Director Marc Lefebvre, City of Parksville, who voted against the funding approval, called for due diligence to be taken.

“If the vote goes in favour of providing funding, I believe we’ll find out soon enough whether or not $20.4 million is enough,” he said.