Sustainable Financing Options for a Marine Protected Area Network In

photo: marilyn mcclelland

Sustainable Financing Options for a Marine Protected Area Network in British Columbia Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Contents

Introduction...... 3

Falling Short...... 4

Public Funding...... 4

Public-Private Partnerships (P3)...... 5 Case Study: The California Marine Life Protection Act Initiative ...... 6

Private Donations ...... 7

Case Study: The Arctic Home Campaign...... 7

Payment for Ecosystem Services...... 8

Blue Carbon Offsets ...... 8

Marine Bioprospecting Fees ...... 10

Resource Use Fees...... 10

Case Study: User Fees in Bonaire National Marine Park...... 11

Community and First Nations Management...... 12

Case Study: Gwaii Hanaas National Marine Conservation Area ...... 13

Conclusion...... 14

Appendix 1: Summary Table ...... 15

Work Cited...... 16

We gratefully acknowldege the generous support of the Gordon and Betty Moore Foundation which has made this report possible.

Vancouver Office Sointula Office #207-343 Railway St. 235 First Street, Box 320 Vancouver, BC V6A 1A4 Sointula, BC V0N 3E0 604-696-5044 250-973-6580

www.livingoceans.org | [email protected] Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Introduction Marine Protected Areas (MPAs) are one of the most effective tools to conserve and protect marine biodiversity . There are many different types of MPAs, but all are ocean places that are set aside like parks through legislative or other means for the purpose of providing sanctuary for individual species and entire food-webs so they can recover and thrive . When planned and managed effectively, MPAs can shield ecosystems from harmful human practices such as destructive fishing practices, offshore oil and gas drilling and other industrial activities; they mitigate the impacts of climate change by protecting coastal and estuarine areas that serve as carbon sinks; they benefit the economies of coastal communities through businesses such as marine tourism and sustainable fisheries . Additionally, MPAs ensure that coastal First Nations can carry out traditional subsistence and ceremonial fishing (Gardner, 2009) . One of the most important factors in establishing and managing effective MPAs is ensuring that sustainable, long-term financing is available . The level of stakeholder engagement necessary for fisheries management in MPAs and the enforcement of the resulting fisheries closures can only be achieved with adequate resources and capacity . The IUCN defines protected area financial sustainability as “the ability to secure sufficient, stable and long-term financial resources, and to allocate them in a timely manner and in an appropriate form ”. 1 In Canada, MPA development and management has historically been governed and financed by the federal and provincial governments . However, given the lack of progress in MPA establishment, it has become clear that alternatives to the current model of MPA development and financing must be employed . Therefore, a combination of financing options could be considered to fund the development and management of a viable network of MPAs on Canada’s Pacific coast .

1 . https://portals .iucn .org/library/efiles/html/BP13-sustainable-financing/Part%20I-section3 .html

photo: gary davis Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Falling Short The Government of Canada has committed to establishing a network of Marine Protected Areas (MPAs) in the country’s three oceans through international agreements such as the UN Conven- tion on Biodiversity, through which Canada agreed to conserve 10 percent of its marine areas by 2020 . This was confirmed at the 2002 World Summit on Sustainable Development (Hutching et al ., 2012) . TheOceans Act also mandates that the federal government, through Fisheries and Oceans Canada (DFO) and other federal agencies, establish and manage a network of MPAs (Hutching et al ., 2012; OAGC, 2012) . However, Canada is not even close to meeting its commitments (Hutching et al ., 2012; OAGC, 2012; Robb et al ., 2011) . In a 2007 study, Canada ranked 70th out of 228 countries in establishment of MPAs (DFO, 2013a) . This is particularly true in British Columbia, where just 0 .7 percent of the province’s waters have been designated as MPAs (B .C . Ministry of Environment [BCMOE], 2009) . A 2012 report to the Auditor General of Canada listed ‘insufficient resources’ as one of the major impediments to progress in establishing MPAs . This same report asserts that establishing a national MPA network in Canada will take several decades due to a lack of funding (OAGC, 2012) . Public Funding In Canada, MPAs are largely funded by the provincial and federal governments . The 1996Oceans Act mandated that the Minister of Fisheries and Oceans coordinate the efforts to establish a national network of MPAs . Environment Canada, Parks Canada, provincial government agencies and First Nations are also expected to play key roles . The Government of Canada’s plan to establish a network of MPAs was further outlined in both the National Framework for Canada’s Network of Marine Protected Areas and Canada’s Federal Marine Protected Areas Strategy (DFO, 2013a). The Canada British Columbia MPA Network Strategy2 was released in June 2014; it states that funding for the B.C. network needs to be identified, and that timelines will depend, among other things, upon resources required and available. In a 2012 report by the Office of the Auditor General of Canada, Fisheries and Oceans Canada and Environment Canada stated that recent budget cuts may impede their ability to meet their mandates regarding MPAs (OAGC, 2012) . In 2013 The Green Budget Coalition, a network of 14 conservation organizations, suggested that the federal government would be required to spend a minimum of $35 million per year, over the next three years, to establish MPAs in five percent of the nation’s oceans (only half of Canada’s commitments under the Convention on Biological Diversity ) (GBC, 2014) . In the 2014 federal budget there was an announcement of a National Conservation Plan, with a budget allocation of $37 million over five years to strengthen marine and coastal conservation . That allocation works out to only $5 .14 million per year over the life of the plan, substantially less than what is required to meet Canada’s domestic and international commitments regarding MPAs . While the federal government should continue to play a key role in the establishment of an MPA network, budgetary cutbacks have necessitated that alternative funding sources be considered to supplement public funding .

2 . http://www .for .gov .bc .ca/tasb/SLRP/pdf/ENG_BC_MPA_LOWRES .pdf Canada, 2014

photo: jeff george Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Public-Private Partnerships (P3) There is a long history of private citizens, companies and NGOs (non-governmental organizations) purchasing or repurposing land and managing it for the purposes of biodiversity conservation . The Nature Conservancy, for example, uses private funds to purchase and set aside land with high biodiversity value to preserve it from agricultural or industrial uses . However, Canada’s oceans cannot be owned by a private entity . The federal government has sovereign and jurisdictional rights over exploration and management within Canada’s 200-nautical-mile Exclusive Economic Zone (EEZ) as well as the management of fishing and marine transportation activities in all of Canada’s waters . Provincial governments have jurisdictional rights for tenured activities and those waters within the “jaws of the land3 ”. Therefore, any attempts to manage activities in marine areas in British Columbia must be done with the jurisdictional authority of the federal and/or provincial government bodies that oversee the waters or activity in question . A public-private partnership (P3) is a partnership between a public government agency and a private entity (usually one or more NGO, charitable foundation, academic institution or private company) for the purposes of achieving a stated goal . In P3s, the private entity provides funding and sometimes also plays an active role in the planning and managing process . P3s can provide numerous advantages for both planning and managing MPA networks . Private entities have supplemented wavering government funds during the planning phases as well as for ongoing management and monitoring purposes (Fox et al ,. 2013) . P3s have also been shown to diversify and strengthen the technical capacity, expertise and infrastructure available from government sources (Fox et al ., 2013) . In many cases, the private entity has improved access to data and research, and the efficiency and capacity for adaptive management (Ban et al ., 2012) . Creating a management partnership can increase accountability and ensure that all members, both public and private, are meeting the stated conservation goals (Weible, 2008) . Those P3s in which control has been decentralized may be more conducive to bilateral monitoring and auditing, which could give stakeholders more trust in the process (Fox et al ., 2013; Weible, 2008) . This was demonstrated through the Natural Areas Conservation Program, a P3 between the federal government and the Nature Conservancy of Canada (NCC) for the purposes of establishing terrestrial protected areas (NCC, 2013) . Instead of managing the program directly, the government disperses the funds to the NCC to purchase and manage lands for conservation . The NCC, in turn, submits progress reports and audited financial statements to Environment Canada, and undergoes third party audits and evaluations to determine that the program is being run effectively and efficiently (NCC, 2013) . There is potential to use this same funding model for MPAs . P3s in MPA network planning can be controversial if any of the parties involved fear that the funding body might interfere to create a biased outcome that supports its own needs or agenda (Kirlin et al ., 2013) . Such was the case in 2011 when the Government of Canada pulled out of the Pacific North Coast Integrated Management Area (PNCIMA) planning process which had been launched after years of work by conservation groups, the fishing sector, tourism out- fitters, First Nations, scientists, and coastal residents . After consultation with a broad range of stakeholders, the governments of Canada, B C. . and First Nations agreed to pursue a P3 funding model where the federal government’s participation was paid for by a grant from The Gordon & Betty Moore Foundation—which has a long track record working with U .S . state governments on multi-use ocean planning . Nonetheless, the federal government withdrew from the funding agreement and the planning process after the marine transportation sector repeatedly voiced its concerns that the PNCIMA marine plan would stand in the way of its interests in moving diluted bitumen from the Alberta tar sands to Asia .

3 . The jaws of the land refers to the waters and submerged lands of the Strait of Juan de Fuca, the Strait of Georgia, Johnstone Strait, Queen Charlotte Strait, and the waters and submerged lands between major headlands which are owned by the province of British Columbia . http://www .nauticapedia .ca/Articles/Waterfront_Property .php http://scc-csc .lexum .com/scc-csc/scc-csc/en/item/5267/index .do

5 However, challenges such as these can often be overcome through the creation of a binding agreement between the parties that clearly defines the roles and responsibilities . For example, the California Marine Life Protection Act Initiative created a binding memorandum of understanding to ensure all partners had full agreement from the outset (MLPAI, 2007) . Such an agreement can also create safeguards to ensure that no one institution has undue influence on the process (Weible, 2008) . There are also concerns about the long-term security of private funds, as private funding entities could change their focus or face dramatic cutbacks, which could put protected areas in jeopardy (Emerton et al ., 2006) . This has been overcome in some situations by the creation of a jointly managed endowment fund in which only the interest accrued from the fund is spent, with the capital remaining in place to grow and support the protected area in perpetuity (van Beukering et al ., 2006) . When an endowment fund is not an option, then P3 agreements at least need to hold the private entity responsible for maintaining funding for a set amount of time, to allow for both short-term and long-term planning (Emerton et al ., 2006; Fox et al ., 2013) .

Case Study: The California Marine Life Protection Act Initiative

In 1999 California passed the Marine Life Protection Act (MLPA), which mandated that the state redesign its current MPA system in order to build a coherent, effective network (CDFW, 2013). The legislation was ambitious and two early attempts at implementation were unsuccess- ful. The first attempt at MPA network planning was done by a relatively small group of government employees and scientists, with little to no stakeholder involvement. When preliminary MPA plans were finally presented during public meetings, the response was largely negative and the plans were shelved. During a second attempt in 2002, the government tried to organize regional stakeholder groups to better engage the public, but a complete lack of financial, technical and human resources prevented success (Fox et al., 2013). In 2004 implementation of the MLPA was indefinitely suspended due to the state’s severe budget crisis (Kirlin et al., 2012). Public outcry led several members of the state’s legislature to lobby for the involvement of private, charitable foundations. That same year, a memorandum of understanding (MOU) was signed by the California Resources Agency, the Department of Fisheries and Wildlife and the Resources Legacy Fund Foundation (RLFF), an independent, non-profit organization (Kirlin et al., 2012). The MOU created the Marine Life Protection Act Initiative (MLPAI), a public-private partnership designed to move the planning process forward despite large cutbacks in government funding (CDFW, 2013). The MOU set clearly defined roles and responsibilities for each of the three organizations. The two government agencies involved retained organizational control over the MPA planning process. The main roles of the RLFF were to obtain, coordinate and administer philanthropic investment, provide additional contract staff and ensure that opportunities for regular stakeholder input were available (Kirlin et al., 2012). Several volunteer groups were formed, including regional stakeholder groups and a statewide interest group, a science advisory team and a blue ribbon task force of experts from both science and public policy sectors(Kirlin et al., 2012). These volunteers donated thousands of hours during the seven year planning process. Private charitable foundations, including the Packard Foundation, the Gordon and Betty Moore Foundation, the Keith Campbell Foundation and the Annenberg Foundation, contributed a total of $19.5 million (Fox et al., 2013). The state provided $18.5 million of public funds. As a result, MPA planning has been completed in four out of the five regions (CDFW, 2013). The government is now in the process of implementing 124 MPAs, covering over 16 percent of California’s waters, with 9.4 percent being no-take1 MPAs (Kirlin et al., 2012). The success of this P3 can be attributed to several key factors: • substantial public interest • a high level of transparency and coordination between partners • substantial funding ensured sufficient scientific data and expertise • extensive and meaningful public consultation It is important to note that the MLPAI took transparent steps to ensure that the private funders had no undue influence over the outcome of the planning process. The signed MOU stated that private funding was solely in support of the process and not contingent on outcomes of the planning process (MLPAI, 2007). The MOU also ensured that roles and responsibilities for each signatory were clearly defined from the outset (MLPAI, 2007). As the implementation process moves forward, the MLPAI continues to serve as an important example of sustainable MPA financing. •

1 A no-take zone is an area within a marine protected area that prohibits all extractive activity including fishing, dredging, dumping and construction. No take zones can act alongside other conventional management tools to encourage the conservation and preservation of marine wildlife or heritage sites and to improve fish stocks for future generations to enjoy. http://www.dfo-mpo.gc.ca/oceans/management-gestion/marineprotection-protectionmarine/boo-fram2011/faq-eng.htm

6 Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Private Donations Case Study: The Arctic Home Campaign While P3s involve direct collaboration between a public and private entity, there are also many examples of individuals, companies and philanthropic foundations funding conservation activities without becoming actively involved in the process . Private donations are one important mechanism for funding protected areas, often through donations to organizations that are responsible for their establishment (Emerton et al ,. 2006) . For example, in the case of the MLPAI, some private entities became actively involved in the process while several foundations simply provided much-needed funding (Fox et al ., 2013) . While many donors support worthy causes for altruistic reasons, it can also be beneficial for private companies to get involved in cause marketing; increasingly, consumers are demanding that photo: ilo gassoway companies be more environmentally and socially responsible . Donating to conservation-related causes is one way that businesses seek to improve their social license . Tying products to a larger conservation message can also In 2011 the Coca-Cola Company partnered with the World Wildlife Fund (WWF) to support its Arctic Home be an effective marketing tool (van Beukering et al ., 2006; Emerton et al ., campaign for the conservation of polar bears (Coca- 2006) . Large transnational corporations have donated millions of dollars Cola, 2012). Coca-Cola pledged U.S. $3 million over to marine conservation activities, including Shell, British Petroleum and five years for the project (Coca-Cola, 2012). This has Coca-Cola (Emerton et al ., 2006) . Funding from private sources should been supplemented with funds generated from the be accepted with caution, however, particularly when it originates from WWF’s private donors. While the polar bear is the companies with questionable environmental records . charismatic species used to market and promote Private funding can be channeled into an endowment fund to generate the campaign, it is more largely focused upon Arctic long-term, sustainable funding . An endowment fund consists of an in- habitat preservation. More specifically, the WWF is helping to facilitate the creation of an integrated man- vestment fund established by an institution or charity that accepts private agement plan for the Arctic region (Tesar, 2011). The donations . The capital of an endowment fund is invested to generate a WWF states that their role is to “facilitate discussion long-term stream of funds through interest and investment income without around the future management of this Last Ice Area, depleting the initial amount (van Beukering et al ,. 2006) . There are already add capacity (financial and technical), and coordinate examples of endowment funds used for conservation in British Columbia . international interest (Tesar, 2011, 2).” Coast Opportunity Funds is an independent organization that manages a This campaign is an example of a mutually-beneficial $116 million endowment provided by private foundations and provincial partnership between a conservation organization and and federal government agencies to support conservation and economic de- a transnational corporation. The WWF benefits through velopment in the Great Bear Rainforest (Coast Opportunity Funds, 2013) . substantial funding from Coca-Cola and increased Private funding can supplement existing funds in perpetuity and can also public awareness through Coca-Cola’s commercials generate an initial influx of funds for the planning process . The fund raising that highlight the soft drink company’s contributions. Coca-Cola hopes to benefit by establishing a repu- campaign required to solicit these donations will also help to educate the tation as an environmentally-responsible company public and may lead to policy changes as a result of increased awareness . through linking their product to a conservation cause. However, there are some downsides to being overly reliant on private do- Coke produced 1.4 billion cans of soda with polar nations . Fund raising campaigns can require substantial up-front resour- bear-themed labels which the company acknow- ces, which are often lacking in smaller regional conservation efforts (van ledged was intended to increase product demand Beukering et al ,. 2006) . Furthermore, the public is fickle in their charitable (Weisberger, 2011). Furthermore, it represents an giving and it is difficult to forecast the amount of funding that could come excellent tie-in to their own branding, since Coca-Cola from private donations far in to the future . Private donations, though, have has used polar bears in their advertisements for over the potential to be an excellent source of supplemental revenue during the 80 years (Weisberger, 2011). By focusing on conserv- MPA network planning process (Emerton et al ., 2006) . ing polar bears instead of promoting the more complex and procedural regional management process, both Soliciting private donations often requires the managing body to create entities have generated public interest and support. a public relations or outreach campaign to promote the cause . There are This effort has not been without detractors though. also many examples where substantial funds for particular causes are raised There has been some controversy within local Inuit from many individual donors . Conservation efforts usually strive to pro- communities due to the association between Coca- tect entire ecosystems, but fundraising campaigns often focus on a single Cola’s product lines and obesity. • charismatic ‘flagship’ species that is easy for the public to connect with (Leader-Williams, 2000) . For example, the successful marketing campaign to protect the northern coastal temperate rainforest ecosystem in B .C ., now referred to as the Great Bear Rainforest, centered on the Kermode or ‘spirit’ bear which became the rallying species for conservationists and donors alike (Hayter, 2005) .

7 Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Payment for Ecosystem Services Protected areas have historically been thought of as an economic cost to society, while the benefits provided were considered to be cultural or intrinsic in nature . That mindset is changing, though, as the economic impacts of environmental degradation caused by natural resource extraction have come to light . Climate change is one example: the environmental impact of treating Earth’s atmosphere as a free dump for carbon pollution is resulting in economic costs to our society . As a result, the benefits that protected areas provide are now recognized as extending beyond the intrinsic to include important services such as flood control and habitat resiliency that protect economic interests . Healthy marine ecosystems contribute to human health and well-being through services such as carbon sequestration and food production (OAGC, 2012; DFO, 2013a) . Heretofore, humans have not had to pay for these services rendered by nature, despite their considerable value . A new concept called Payments for Ecosystem Services (PES) represents a collection of market-based approaches to promoting biodiversity and protected areas . It is based on the idea that those who economically benefit from the exploitation of natural resources should be required to pay to ensure the ecosystem’s continued viability (Potts et al ., 2012; Emerton et al ., 2006) . There is significant potential to use PES as a way to generate funds for an MPA network . In order to set up a PES, the ecosystem services must be identified and, wherever possible, quantified (Pagiola, 2008) . It also must be determined how these services would change or be diminished by ecosystem degradation so that the method of charging ecosystem service users can be established (Pagiola, 2008) . According to a 2008 report, “no PES programs have been implemented for coastal and marine ecosystems (Pagiola, 2008, 15) ”. This can be largely attributed to the fact that benefits and costs may be difficult to establish given the inherent uncertainties associated with marine ecosystems . Often the ecosystem services provided by marine ecosystems are incredibly diffuse and occur on a global scale . Given this complexity, provincial or federal governments may be the only entity large enough to administer a PES program for coastal and marine ecosystems (Emerton et al ., 2006) . However, there are two ecosystem services that have demonstrated the potential for market development: blue carbon and marine bioprospecting . Blue Carbon Offsets Climate change is a major problem that is already affecting many aspects of our lives . The ocean is also being significantly affected by changes to the atmosphere . One third of all carbon dioxide emitted into the air is absorbed by the ocean which alters its chemistry and makes it more acidic . Climate change is also resulting in warmer ocean temperatures . One of the major ecosystem services provided by marine ecosystems is carbon sequestration . In coastal and estuarine habitat that contains salt marshes and seagrass beds, carbon is stored in mineral form in the sediments for thousands of years (McLeod et al ., 2011) . In B .C . there are approximately 400 square kilometres of salt marshes and seagrass beds that sequester approximately 180,200 tonnes of carbon each year (Campbell, 2010) . The ocean’s carbon storage capacity, often referred to as ‘blue carbon’, is a key ecosystem service that has global benefits to humans . One way to recognize this ecosystem service could be by creating blue carbon offsets . The World Resources

Institute defines carbon offsets as “a unit of carbon dioxide-equivalent (CO2e) that is reduced, avoided or sequestered to compensate for emissions occurring elsewhere” (World Resources Institute, 2013) . The use of carbon offsets is controversial and research continues into the appropriate use of offsets . The IUCN has developed a “mitigation hierarchy” that gives guidance on the appropriate parameters for the use of biodiversity offsets . Blue carbon offsets should specifically fund the conservation and protection of coastal and marine vegetation to promote carbon sequestration . In British Columbia, terrestrial carbon offsets have been used to create a carbon-neutral provincial government and public sector (Pacific Carbon Trust, 2014b) . This was managed briefly by Pacific Carbon Trust (PCT), a crown corporation that offset carbon through numerous

8 photo: janna nichols

A lion nudibranch rests in a bed of eelgrass. Coastal ecosystems are up to 2,000 times more efficient than land plants

at removing CO2 from the atmosphere.1 In order to take full advantage of their “blue carbon” capabilities, we have to make sure our seagrass and salt marshes are safeguarded as part of a network of marine protected areas.

1 . http://www .habitat .noaa . gov/coastalbluecarbonreports . html

projects, including those focused on alternative energy, forest and agricultural management and improved energy efficiency (Pacific Carbon Trust, 2014a) . Since PCT was folded in to the B .C . Ministry of Environment’s Climate Action Secretariat (CAS) in 2013, the provincial government has maintained its commitment to a carbon-neutrality . The CAS has not yet explored blue carbon offsets as a potential addition to the range of terrestrial offset projects that it supports, although blue carbon offsets are being explored on a local level: a project led by the Comox Valley Project Watershed Society is exploring the possibility of funding the conservation of coastal ecosystems through blue carbon credits . The non-profit organization has partnered with Vancouver Island University and the B .C . government to identify key blue carbon habitat, evaluate costs of blue carbon projects and undertake conservation and restoration activities in these key habitats (Project Watershed, 2013) . While doing so, this partnership will explore the creation of a viable, sustainable blue carbon market in the province . If blue carbon projects could be developed and commercialized by public or private carbon offset companies subject to stringent verification standard, offsets may present a significant source of funding for the development and maintenance of nearshore MPAs .

The Mitigation Hierarchy

Figure 3. Ref: IUCN Technical Study, April 2014 Managing impact on biodiversity for new projects is a serious problem for resource extraction industries. One way is to com- mit to developing new projects in a way that avoids then mini- mizes impacts to biodiversity. After project completion the re- sidual impact of the project is offset by investing in marine or terrestrial biodiversity projects that have been registered as potential offset projects.

9 Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Marine Bioprospecting Fees One key service to humans provided by biodiversity is the provision of raw biological and genetic resources for the development of products . ‘Bioprospecting’ involves the collection and testing of these resources to determine whether they have potential to be used in products such as medicines and cosmetics (Hunt and Vincent, 2006) . There have been many examples of exploitation or theft through bioprospecting as it has historically involved the use of local and indigenous knowledge without compensation . For this reason, it has become increasingly accepted that private companies wishing to exploit biological resources must provide compensation to indigenous peoples, conservation organizations or local governments (Demunshi & Chugh, 2010; Geary et al ., 2013) . This has been confirmed internationally by the Nagoya Protocol, an amendment to the Convention on Biological Diversity (CBD) that establishes guidelines for fair and equitable use of biological and genetic resources (Geary et al ., 2013) . Canada is a signatory of CBD and must therefore comply with the guidelines laid out by the Nagoya Protocol . There is potential for channeling a portion of these marine bioprospecting fees into marine conservation initiatives (Geary et al ., 2013) . This was demonstrated in 1992 when the U .S . National Cancer Institute paid the Coral Reef Foundation $2 .9 million for reef samples needed in cancer research (van Beukering et al ., 2006) . British Columbia’s marine environment is incredibly diverse and therefore a strong potential exists for product development . If some portion of any future bioprospecting fee is dedicated to marine conservation, it could represent a significant funding source for MPAs . Resource Use Fees Resource use fees are simply a payment made for non-extractive uses of an MPA, such as access for tourism and recreation . This is a way to capture some of the intrinsic and scenic value of the MPA which is used to fund its management (Emerton et al ., 2006) . This type of financing has been very important to terrestrial parks and protected areas, and is now being extended to MPAs around the world (van Beukering et al ., 2006; Emerton et al ., 2006) Resource use fees are a common source of funding in developing nations’ MPAs, particularly those with tourism- friendly coral reefs (Thur, 2010; Green & Donnelly, 2003) . Activities such as whale watching, recreational fishing, scuba diving, surfing, kayaking and sightseeing are enriched by the presence of an MPA network and can result in increased tourism revenue for coastal communities (Dharmaratne et al ,. 2000) . However, this increase in revenues may not translate to funding for MPA management . In some jurisdictions, governments have captured some of these benefits through payment vehicles such as entry fees, vessel surcharges and licenses for recreational fishing or scuba diving to fund MPA management (Thur, 2010) . The presence of well managed and enforced MPAs ensures the values that draw the marine tourism industry remain viable in the long-term (Thur, 2010) . User fees can be an important source of supplemental funding for MPAs, though in some cases MPAs and marine parks have been exclusively funded in this way (Thur, 2010) . The fees target only those who directly benefit from the presence of the park and thus are likely to be more socially accepted than a more general tax increase or reallocation . Furthermore, several studies of tourists who have paid user fees for an MPA have indicated the majority of tourists are willing to pay (Thur, 2010) . In British Columbia, users of provincial parks are accustomed to paying a fee for entry . For example, canoeing the Bowron Lakes costs CDN $60 per person (BC Parks, 2014) . A 2014 survey conducted in British Columbia by Living Oceans Society found that individual marine users, particularly recreationalists, were open to the concept of a user fee as long as there was transparency about how it would be used . Similarly, tourism businesses were tentative about paying a user fee unless it led to a more transparent MPA process (Living Oceans Society, unpublished data, 2013) . Many of the disadvantages of user fees stem from the logistical difficulties associated with ensuring fee payment . There are no physical barriers to entering an MPA and additional resources would

10 Sustainable Financing Options for a Marine Protected Area Network in British Columbia

be required to monitor and enforce the payment system (van Beukering, 2006) . There may also be some backlash from tourists or tourism operators who resent having to pay additional fees or increase their prices (Depondt & Green, 2006) . One study of scuba divers in Bonaire Marine Park (see case study) found that some tourists believed they did not get anything as a result of the fee or disagreed with being charged in order to access nature (Thur, 2010) . This could be remedied if tourists and operators were properly educated on both the overarching and tourism specific benefits of MPAs and how their fees contribute to its management . Finally, while user fees have the potential to be an important source of revenue for MPAs near coastal communities, those MPAs that are hard to access or closed to the public because of habitat sensitivity could not generate revenue in this manner . If revenue from the accessible MPAs were used to finance a full regional network, even the most remote MPAs would benefit .

Case Study: User Fees in Bonaire National Marine Park

photo: clark anderson/aquaimages Bonaire National Marine Park is unique as a fully self-financed MPA (Thur, 2010). Bonaire, a small island within the Dutch Antilles, generates a significant amount of revenue from diving and marine tourism. The park is managed by the Netherlands Antilles National Parks Foundation, an NGO that is entirely responsible for the park’s day-to-day operations (STINAPA, 2013). The island’s waters were designated as a Marine Park in1979 with the full support of the Dutch government and an initial influx of revenue from the WWF in Holland (STINAPA, 2013). After its initial funds ran out, the park experienced significant financial difficulties and lapsed in to a ‘paper park’ for several years (Thur, 2010). In an effort to revitalize the failing park, in 1992 an annual user fee of U.S. $10 for scuba divers was implemented to support proper management. This fee structure has since been expanded and now all visitors to the marine park pay an annual fee ranging from $10 to $25 (STINAPA, 2013). Once this fee is paid, visitors receive a ‘tag’ allowing access to the park for one year. Visitors are also asked to participate in an orientation session to ensure the park is used in a sustainable manner. While the park fees remain relatively modest, one recent study found that scuba divers were willing to pay between U.S. $61 and $134, indicating that an increase in user fees would not reduce demand for park access (Thur, 2010). Several characteristics of this marine park made it a viable candidate for user fees. There is a significant demand for recreation within the park, which would be reduced if the park wasn’t properly managed. It is also in a relatively small geographic area, making monitoring and enforcement more feasible. Furthermore, there was significant support from the surrounding local communities; since tourism is at the center of the island’s economy, residents are supportive of the park’s management and conservation. The fact that the user fees are paired with an educational component ensures that tourists and visitors understand the fee and are respectful of the protected area. • Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Community and First Nations Management Community-based ecosystem management (CBEM) is a bottom-up, holistic approach to resource and environmental management . CBEM has grown increasingly common in the last few decades and is now a central feature of many MPAs, particularly in developing countries (Govan et al ., 2009) . For example, in the South Pacific, locally-managed MPAs have led to the protection of over 12,000 square kilometres of ocean, while those managed at higher levels of government have largely devolved into ‘paper parks’ (Govan et al ., 2009) . The benefits of establishing locally-managed MPAs include “recovery of natural resources, improved food security, increased economic opportunities, improved governance, access to information and services, health impacts, improved security of tenure, cultural recovery and strengthening community organization (Govan et al ., 2009) . There is an integral role for local communities and First Nations in MPA planning and management in British Columbia . A recent study by Edgar et al . (2014) found that the implementation of fisheries closures and the effective enforcement of MPAs are two of five elements critical to their success . It has been demonstrated that the support of nearby residents is a prerequisite to successful protected areas; their involvement also has the potential to ease financial burdens and generate funds for MPAs . Decentralization of management authority can reduce administrative costs as well as the costs associated with monitoring and compliance since locals can play a role in monitoring and are more likely to comply with regulations if they are actively involved in management (Aalbersberg et al ., 2008) . There is also the potential for revenue generation for MPAs through user fees and benefit-sharing agreements (Thur, 2010) . First Nations and local communities can bring traditional and place-based knowledge and values to the MPA planning and management process, increasing its effectiveness (Parks Canada, 2010) . However, using CBEM in MPA management is not always a feasible option . There may be issues related to jurisdiction and the ability of the local community to legally enforce regulations within their MPA . Finally, it must be ensured that there is adequate capacity and resources within the community to manage the MPA effectively . Many of these issues can be remedied through a policy environment favorable to CBEM and planning resources to deal with internal conflicts .

12 Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Case Study: Gwaii Hanaas National Marine Conservation Area Reserve

Gwaii Haanas Marine Conservation Area Reserve (GHMCA), located off the southeast coast of Haida Gwaii, was established in 2010 as a formal government-to-government partnership between the Haida Nation and the Government of Canada (Jones et al., 2010). It is part of an integrated co-operative conservation plan of 5,0002 kilometers of land and waters. This marine area contains 3,500 identified species and numerous different types of marine habitat (Parks Canada, 2010). It is integral to Haida culture and history, and is an important source of livelihood. While only three percent of GHMCA is a ‘no-take’ zone, there are differing levels of use restrictions throughout the entire area. This agreement has been beneficial for the Haida through increased tourism and other economic opportunities, sustainable use of their traditional marine resources and incorporation of their knowledge and values in to the decision-making and planning processes (Jones et al., 2010). The government has benefitted through improved on-the-ground technical and logistic support from the Haida and increased local support for the establishment of the GHMCA. While the comprehensive marine use plan will not be completed until 2015, the GHMCA represents a promising first step forward in First Nations management and self-determination in the MPA planning process. The GHMCA will be managed by the Government of Canada and the Haida Nation and will be based upon the following management objectives: Objective 1 Establish and implement effective collaboration for planning and management. Objective 2 Protect, conserve and restore marine biodiversity and ecosystems. Objective 3 Sustain the continuity of Haida culture and protect features of spiritual and cultural importance. Objective 4 Promote ecologically sustainable uses of marine resources. Objective 5 Advance understanding of biodiversity and ecosystem functions, natural and social sciences, cultural resource values and sustainable uses. Objective 6 Enhance awareness and understanding, among local and national audi- ences, of the natural and cultural heritage. Objective 7 Foster meaningful connections for all Canadians, and provide opportunities for memorable visitor experiences. • Gwaii Haanas National Marine Conservation Area Reserve and Haida Heritage Site Interim Management Plan and Zoning Plan, May 2010. www.pc.gc.ca/ Sustainable Financing Options for a Marine Protected Area Network in British Columbia

Conclusion MPA networks safeguard the ability to seed and repopulate areas that are damaged elsewhere on the coast because of human activity . Currently, only one percent of Canada’s oceans and Great Lakes are protected in federally designated MPAs . If Canadians hope to find a way to use the ocean without using it up, it is time to reverse the stagnation that has beset MPA planning and establishment . This paper has looked at a handful of the funding sources available to finance an MPA network in British Columbia in the absence of adequate public funding: public-private partnerships, private donations, payments for ecosystem services, user fees and CBEM all present potential alternate options . However, comprehensive cost-benefit analyses must be completed before alternative supplemental funding sources are sought out . This will help to determine who stands to win and who would lose out in the development of an MPA network, and ensure that the proper people, businesses and industries are paying for the benefits derived as well as compensation for their losses . It is clear that the people of British Columbia cannot be wholly reliant on government to protect their ocean ecosystems from degradation . Despite federal government inaction on marine planning and budget cutbacks on this issue, an MPA network is still an achievable and feasible goal . In order to succeed, however, MPA managers will need to creatively seek out and arrange a diverse portfolio of funding sources in order to ensure long term financial sustainability of protected areas if Canada is to meet its international commitments to protect its oceans .

14 Appendix 1: Summary Table

Funding Description Advantages Disadvantages Case Study Mechanism Public- A partnership between a Diversifies funding Public concern over bias California Marine Private government agency and Increases public participation Differing ideologies between Life Protection Act a private entity (usually Partnership Improves transparency and ac- entities can create conflict Learn More: one or more non-gov- countability Funding isn’t always long- http://bit.ly/1dl4h4p ernmental organization, term charitable foundation, Improves technical capacity academic institution or and expertise private company) for the Increases public trust purposes of achieving a stated goal. In P3s, the private entity will often provide funding as well as play an active role in the planning and managing process.

Private Individuals, companies Diversifies funding Private funding can be fickle The Arctic Home Donations and philanthropic founda- Can improve marketing and Expensive to solicit dona- Campaign tions provide short-term communications capacity tions Learn More: or long-term funding to Increases awareness and pub- Concerns over private fund- http://bit.ly/1fAoZ59 conservation initiatives. lic engagement ers environmental record (e.g. BP)

Payments for A collection of market- Diversifies funding No prior example of PES NA Ecosystem based approaches that Improves economic efficiency used for MPAs Services ensures those who bene- by creating markets for MPAs Logistically difficult/requires fit from ecosystem servi- Provides justification for public extensive research ces pay to ensure the spending on MPAs ecosystem’s continued viability. Can help to compensate those who bear MPA costs

User Fees Resource use fees are Diversifies funding Difficult to enforce fees in Bonaire National payments made by those Ensures those who directly open ocean area Marine Park wishing to use the MPA benefit from MPA bear some Not applicable to remote Learn More: directly, often through cost as well MPAs http://bit.ly/1ahXc9y tourism and recreation, Benefits the local economy Mat be backlash from tour- which is then used to through ensuring long-term ism operators regarding de- fund the management of tourism revenues creased demands the MPA. Encourages public education and outreach related to MPAs

Community- MPAs are funded and Can lower conflict and increase May be conflict amongst Gwaii Haanas Based managed by a community public support amongst re- community members National Marine Management or First Nation independ- source users Can lead to uncoordinated Conservation Area ent of governmental juris- of MPAs Decentralization of MPA man- management amongst MPA Learn More: dictions, or in partnership agement networks http://bit. with them. Allows for use of traditional May not be legally recog- ly/1im8A4C knowledge nized by the government Easier to monitor and enforce MPA rules Improved relationship building, coordination and communications between communities and government. Sustainable Financing Options for a Marine Protected Area Network in British Columbia

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