32nd ANNUAL GENERAL MEETING CANADIAN NAVAL MEMORIAL TRUST 28 JUNE 2017 – THEATRE IN ART GALLERY OF NOVA SCOTIA 1723 HOLLIS STREET, HALIFAX, NS
32.01 Welcome and Introduction: Chairperson
The Chairman, Wendall Brown, called the meeting to order at 1:21 pm. He introduced the Directors, Trustees Bill and Jette Thomas from Dundas, ON, and Bruce McKean from Ottawa, ON. He acknowledged the presence of the Project Working Group Officer, George Borgal, and the former Project Working Group Officer, Ted Kelly, and thanked him for being at the AGM. There were 59 people in attendance.
A. Prayer for departed Trustees: Padre Andrew Cooke
The CNMT Chaplain, LCdr (Ret’d) Andrew Cooke, read the names of Trustees who had Crossed the Bar during the past year (Annex A)
32.02 Approval of Minutes for 31st AGM
MOTION: It was moved by Bill Gard and seconded by Patricia Martenson that the minutes of the 31st AGM on 29 June 2016 be accepted. CARRIED
32.03 Chairman’s Report: Bryan Elson and Wendall Brown
Bryan Elson and Wendall Brown presented their Annual Reports: Bryan Elson from last year’s AGM to 5 May 2017 and Wendall Brown from 5 May to 28 June 2017. (Annex B)
32.04 Treasurer's Report: Bryn Weadon
The Treasurer, Bryn Weadon, presented a report on the Financial Status of the Trust. There were no questions. (Annex C)
MOTION 1: Bryn Weadon moved and Barry Wile seconded that the 31 December 2015 Audited Financial Statements, provided to members in advance of the meeting be approved. CARRIED
MOTION 2: Bryn Weadon moved and seconded by Ted Kelly that WBLI be retained as our Trust auditors. CARRIED
32.05 Investment Committee Report: Bryn Weadon
Bryn Weadon presented the Investment Committee Report. (Annex D)
32.06 Project Working Group - Battle of Atlantic Place: George Borgal
George Borgal presented the Project Working Group Report. (Annex E)
MOTION: It was moved by Wendall Brown and seconded by Bryan Elson that the Canadian Naval Memorial Trust acknowledges with sincere gratitude the key leadership of Ted Kelly as Chair of the Project Working Group, and of Hugh MacPherson who was the Working Group’s link to government and the business community. Together they provided a never-ending source of ideas to establish the visionary concept for Battle of the Atlantic Place which, when achieved, will celebrate the accomplishment of the generation of Canadians that transformed Canada, and serve to preserve HMCS Sackville for the future benefit of all its citizens. CARRIED
32.07 Ships Operations Report: Jim Reddy
The Commanding Officer, LCdr (Retd) Jim Reddy, presented the Ship’s Operations Report. (Annex F)
32.08 Membership Report: Richard Oland
Richard Oland presented the Membership Report. (Annex G)
32.09 Public Relations Report: Pat Jessup
Len Canfield presented Pat Jessup’s Public Relations Report. (Annex H)
32.10 Website Report: John Pickford
John Pickford presented the Website Report. (Annex J)
MOTION: It was moved by Bill Gard and seconded by John Pickford that the Canadian Naval Memorial Trust acknowledges with sincere gratitude the efforts of Richard Wood to take on the role of Webmaster for the Canadian Naval Memorial Trust's website over the past number of years. This necessitated that he train himself in the details of website administration, how to improve, amend and keep it up to date with Trust Activities. CARRIED
32.11 The Future/The Challenges: Wendall Brown
Wendall Brown presented his thoughts on the Future and Challenges ahead. (Annex K)
32.12 Ratification and Confirmation: Bill Gard
MOTION: It was moved by Bill Gard and seconded by Tony Goode that all actions and conduct of the Board of Directors of the Canadian Naval Memorial Trust, made or undertaken on behalf of the Trust, up to date 28 June 2017, be and are ratified and confirmed. CARRIED
32.13 Proposed Board of Directors for 2017/2018: Bryan Elson (Annex L)
MOTION: It was moved by Bryan Elson and seconded by Bill Thomas that the Slate of Directors as presented for 2017/2018 be accepted as presented. CARRIED CARRIED
32.14 Working Committees
A list of individuals helping the CNMT and Project Working Group to make Battle of the Atlantic Place a reality is provided. (Annex M)
2 32.15 Adjournment:
There being no further business, it was moved by Richard Oland and was seconded by Steve Rowland that the meeting be adjourned at 4:18 pm.
Respectfully Submitted William Gard Recording Secretary
Attached Annexes A to K
Annex A to 32nd AGM MINUTES Crossed the Bar
Padre Andrew Cooke read the names of Trustees deceased since the 2016 CNMT AGM
FROM SUMMER 2016 ISSUE OF ACTION STATIONS
ACHESON, Grace Olive Feb. 28th BINT, Benjamin William (Bill) RCN March 6th BOUTIN, Roger Joseph RCN March 11th CANFIELD, Dan June 2nd FURTNEY, Wayne William Trustee June 5th VERDUN, Dr. (Don) Gilbert RCN March 14th GOULD CD, Sidney C. (LCdr) RN/RCN April 29th JESSUP, Betty Ann (Leading Airwoman) RCAF May 10th JESSUP, Diana Marie Elise July 29th KIDD, DSC. OMM. OS. CD Derek John (Piet) (Surgeon Captain) RCNVR/RCN April McCAIN-McMILLIN, Isobel Rosemary Trustee May 27th MYERS, Ronald (Ronnie) RCN May 27th MacLEOD, Allison Hugh (Commander) Army/RCN July 12th MIELZYNSKI Sr, Peter April 7th MONTGOMERY, Robert A.F. (Captain) RCN April 2nd. OLAND, Ruth (Hurley) May 23rd SHAW, Dennis Beaumont (CPO) RN/RCN March 20th WALKER, Timothy John Feb. 24th WELDON, Lawrence (Larry) RCNVR June
FROM FALL 2016 ISSUE OF ACTION STATIONS
KELLY, John Francis (Jack) Trustee October
FROM SPRING 2017 ISSUE OF ACTION STATIONS
BULL, Hilbert Arthur (Harry) RCN/RCAF Jan. 28th DANIELS, Robert Hugh (Bob) RCN Oct 17th FISHER, CD, Brian (Commander) RCN March 4th CLEMENT, Wilbur (Clem) Trustee Nov. 9th FREEMAN, Russell (LCdr) RCN Jan. 18th 2017 GILLINGHAM, MB, CD., Gerald J. (WO) RCN July 18th GREER, Gerald Eugene (Gerry) RCN Feb. 2016 GUY, CD., Allan R. (LCdr) RCN Dec. 18th
3 HANINGTON, Felicity Margot Oct. 29th KEARNEY, CD., George A. (LCdr) RCN Aug. 17th McEWAN, Harry J. RCN Nov. 2015 McIKERT, Peter John Feb. PULLEN, CD, Hugh F.H. (Major) Army Sept. 6th SHIMANSKY, John Thomas (Sam) RCN Dec. 4th STRINGER, Christina TAYLOR, Douglas Arthur RCN Feb. 21st 2017 UWINS, Lawrence (Larry) (CPO) RCN March 20th WATSON, Joseph Robert (Harry) RCN Feb. 3rd 2017
Annex B to 32nd AGM MINUTES Chairman’s Annual Report
Bryan Elson: Covering the period 1 July 2016 TO 5 May 2017 1. Introduction: Let me begin by adding my own welcome to all of you for attending today. Some important issues will be raised for your information, and of course a new Board will be elected. You will have seen from the Agenda that the usual remarks will be in two pieces. At the January 2017 Semi-Annual Meeting, I made an advance announcement of my decision to step down as Chair of the Board, largely for personal reasons. That decision became effective at the 5 May meeting of the Board, at which the Vice-Chair became Acting Chair. I will be covering the period from the last year's AGM to 5 May. As you are aware, the Trust's Management Structure is built on an array of Committees of Volunteers, each of which has its own duties, aims and budget. Overall Coordination is exercised by the Board as necessary, but much of the work is accomplished at the Executive Committee level, where the Executive Director, Doug Thomas, continues to play a key role. Each one of these committees has to be congratulated on a very successful year. The chairs will be giving an account of their committee’s achievements, so I don't intend to steal their thunder by listing them now. I would also be remiss if I didn't recognize our very small paid staff; each of them earns their pay many times over. Under the guidance of our Treasurer Bryn Weadon and Accountant Debbie Findlay our financial position is good, always barring unexpected demands on our resources. Jim Reddy runs the tightest ship in the harbour. As always, Pat Jessup, does an outstanding job in all the many area she somehow involves herself. All things considered, I believe the Trust runs about as well as any Volunteer Group, and better than most. But that is not to say that a need for changes may not emerge. Nor can we forget the ever- present need for more Trustees to step forward to help strengthen the committee structure
2. Highlights: I would like to turn to a few policy issues that have engaged the Board over the period I am talking about. It was recognized early on that the Trust could soon have some significant challenges. We recognized that as a Board we need to strengthen our ability to face known and unknown risks. A. Chase the ACE: At the suggestion of Neil Black, we pursued the idea of running a Chase the ACE lottery in conjunction with the Halifax Casino. The potential financial rewards were of course very attractive. Steve Rowland did the job of analyzing the ideas, and we went so far as to obtain a License from the NS Gaming Authority. However, it became apparent that the task of management was beyond our ability as a volunteer organization, to the point where the risks outweighed the foreseeable rewards. Regrettably, we put the idea to bed. B. Website: We see the upgrading of our website as a very effective way of strengthening the Trust through enhanced public awareness. John Pickford is chairing a small committee which is producing
4 exciting results. One spin-off might be better coordination of our overall Education and Marketing Communications under the banner of a new committee. C. Battle of the Atlantic Place: From its beginning in 2012 up to today, this very exciting initiative has been managed in the name of the Trust through its Project Working Group. In early 2014, the Trust took delivery of the Concept Design from the Prime Contractor, a very important building block in a phased process. All progress to date must be credited to Ted Kelly and George Borgal for their leadership of the Project Working Group, which remains hard at work and which you will hear more about later. D. Short Term Preservation: The original understanding between Marcom and the Trust was that a docking would occur every six years, subject of course to operational priorities. It is now 9 years since SACKVILLE has docked. In 2014, an internal Hull Survey by a dockyard team resulted in a MARLANT decision to no longer allow the ship to proceed for the Battle of the Atlantic ceremonies off of Point Pleasant Park. Procedures have recently changed. This change means that the Ministry of National Defence must now personally sign a Provision of Services agreement for a SACKVILLE Docking. It appears the Minister's signature has not yet been obtained. In its absence, the docking would appear problematic. All this could have very far-reaching implications, on several levels. Much has happened since I stood down, and the acting Chair and commanding Officer will no doubt pick up the story.
Thank you for your attention, and I will now try to answer any questions.
Wendall Brown: Covering the period 5 May 2017 to 28 June 2017 1. Introduction: Welcome to the annual general meeting of the Canadian Naval Memorial Trust, with appreciation to those who have come from outside the local area to join us today. I would also like to publicly thank the Board of Directors and the many volunteers who make the Trust work. Without their dedicated services, we could not achieve much of anything let alone the amazing things we do. It is about the History, those who served then and now and how best we can continue to tell the compelling story of great Canadian achievement. In the end, it is about Canada and all Canadians. Thank you all for your commitment and for being here today. Have you had time to visit SACKVILLE? She is proudly ready alongside Sackville Landing to welcome our summer visitors. Jim Reddy, the ship’s crew, and many volunteers have her looking pristine. Talk to our civilian tour guides, an RMC Officer Cadet, our sailors and trustee guides. I am sure that you will find them both enthusiastic and knowledgeable. This is an important meeting because we are sailing in uncertain waters; but, we have been there before. I have been reading the records of the acquisition and conversion of the ship. It is déjà vu. All of the issues that we face today, funding, volunteers, and official support, were front and centre from the first initiative to save a corvette in 1975. The encouraging omen as I look around the room is the experience, talent, and demonstrated initiative that I see represented here we just need to apply it to the task at hand.
We will review the past year and outline the critical tasks of the coming months
Annex C to 32nd AGM MINUTES Treasurer's Annual Financial Report
The 2016 Financial Statements were prepared by MNP (formerly WBLI) in conjunction with their 2016 audit. These financial statements provide the financial position as of 31 December 2015 and 31 December 2016 as well as the financial operations for 2015 and 2016. No issues were identified by the auditor with respect to fraud or internal control deficiencies. There were no changes in accounting policies in 2016.
5 2016 Financial Results for each of the four CNMT funds were as follows:
a. The Operating Fund had excess revenue in 2016 of $44,128. Excluding $41,820 in Ship Operation expenses that were funded through a transfer from the Preservation Fund, overall operating expenses were $14,693 higher in 2016 compared to 2015. Revenues were $38,726 higher in 2016, reflecting an increase in donations partially offset by lower life membership sales. The Operating Fund ended 2016 with a balance of $304,464, an increase of $85,948 compared to the end of 2015.
b. The Preservation Fund had excess revenue in 2016 of $284,209, partially offset by the transfer of $41,820 to the Operating Fund for a net increase of $242,389. $17,893 of the Preservation Fund’s revenue came from donations while the remainder of the increase was from investment income. The Preservation Fund ended 2016 with a balance of $1,913,334.
c. The Project Fund had a revenue deficiency in 2016 of $41,878. The Project Fund received $6,920 in Donations in 2016. Funds were expended on outreach and the maintenance of a Project office. The Project Fund ended 2016 with a balance of $190,943.
d. The Endowment Fund received $10,284 in donations in 2016, bringing the total balance at the end of 2016 to $49,076. One percent of the balance as of 1 January 2016 was provided to the Operating Fund as an admin fee while the remainder of the investment income is included as part of the Preservation Fund.
In 2016, the Calendar achieved $3,174 in sales and had net revenue of $757 after including $5,687 in sponsorship received. The Gift Shop, excluding calendars, lost $4,667 in 2016 – however this includes $9,281 in wages. The Mess, with sales increasing by $1,727 while expenses declined by $2,593, achieved net revenue of $2,593.
As of 31 May 2017, the Operating Fund has a year-to-date revenue deficiency of $34,240, approximately $2,400 higher than at the same point in 2016. No concert revenue from using the library location this year as well as additional Gift Shop expenses account for the majority of this difference.
Submitted by: Bryn Weadon, Treasurer
Annex D to 32nd AGM MINUTES
Investment Committee Report
As of 31 May 2017, the CNMT had total investments of $2,301,892.
The 2017 YTD performance for the two investment accounts is as follows:
Transfers Investment 2017 YTD 1 Jan 17 In/Out Gains/Losses 31 May 17 Return
6
Seamark $1,469,696 Nil $78,804 $1,548,500 5.4%
RBC $761,966 ($18,000) $9,426 $753,392 1.3%
Total $2,231,662 ($18,000) $88,230 $2,301,892 4.0%
$145,951 ($145,463 share value plus $488 of dividend income) of the amount shown above is donations held in Trust for the Battle of Atlantic Project in the RBC account.
$20,775 of the 2017 investment gains/losses are the result of dividends or pooled fund distributions that have been reinvested. $67,455 is the result of realized and unrealized capital gains.
The portfolio increased by $38,041 or 1.7% during April and May. This increase was due primarily to Global Equities in the Seamark account.
In addition to the reinvestment of Seamark Pooled Fund distributions, shares in Cenovus were purchased.
Prepared by: Bryn Weadon, Investment Committee Chair, 14 June 2017
Annex E to 32nd AGM MINUTES
Project Working Group Report - Battle of Atlantic Place 2017 Overview:
Since last year’s report the project has continue to advance, albeit slowly.
As most will know from the Semi-Annual AGM, Ted Kelly has stepped back as the Chair of the Project Working Group after some 6 years of constant effort in first developing the concept the Trust has now embraced, and then shepherding our Working Group’s progress in trying to make it happen. In the process, we have come a long way and are now readying ourselves to transition from concept to implementation. To achieve this, we will need to confirm the necessary political and public support essential to ensure the initial, near term, and long-term funding critical to success, and we will need to stand up the Battle of the Atlantic Society.
I will speak more to these points a little later, but first would like to acknowledge the considerable leadership of the two Trustees whom have been instrumental in getting us this far. Many of us helped in small or large measure, but it was Ted Kelly who had the drive, energy and vision to shape the concept, gain the first expressions of support from all three levels of government, and develop the promotional tools that allow us to have presence in the minds of others, such as the concept book, the video, our brochures, not to mention the considerable correspondence and too-numerous-to-count presentations to all who would listen, or who were not quick enough to close the door before his foot was through it. Ted was most ably partnered by Hugh MacPherson throughout these years, until family pressures forced Hugh to withdraw from active involvement a couple of years ago. Hugh was the ultimate team player, had the
7 imagination to stimulate thought and action, and the contacts and perseverance to engage and motivate those who could help the project politically and financially.
The Concept and Its Cost:
I think it’s important at this AGM to reinforce for all Trustees how sound the concept is, and to describe as clearly as I can what the rationale is that supports the economics of the project in terms of costing and sustainability.
To begin with, the concept as developed has been consistently viewed as important and credible by all those to whom we have talked, whether in government, in business or in public conversation. As you know, the Trust has received endorsements of support from cabinet level Members of Parliament, from all three major federal parties, from all provinces, and from the Halifax Regional Municipality. In developing the concept, we also received funding support from all three levels of government and the donations of many Trustees and the general public. To date we have spent about $1.1M, and are ready to go to the next step: implementing the concept. And for this we need to secure initial funds to stand up the Battle of the Atlantic Society, and the political support necessary to assure that future funds for preparation and construction will be in place.
The issue is not so much the idea but the money. To many in government, the indicative cost range is daunting, or at least they say it is, and it’s proving difficult to get past this sticker shock. This is the challenge: how to move who we hope will be our main funders from lip service to rubber on the road, but we have made some progress in establishing the credentials of the economic case. And this is the part all Trustees need to understand, beginning with the estimate of construction.
The concept is bold and imaginative, exactly what the Ivany Report called for, but how much will it cost and how can it be justified? To answer these questions, the Trust contracted for authoritative reports that could stand scrutiny of daylight.
Marshall & Murray Incorporated, Quantity Surveyors and Development Consultants, a nationally recognized expert in costing large projects, were engaged to estimate the costing envelope for Battle of the Atlantic Place. A Class C estimate is what is expected of a project at this stage of development, and their original numbers, along with those of those of Stantec Architecture and Catalyst Consulting, became our Projected Cost Summary. The original range between $180M and $205M was adjusted this year to become $195M and $225M. It is important to note that this adjustment is due only to the effect of time, in terms of inflation and changes in the value of material paid in US funds. It does not represent mission creep. It is also important to note that these numbers are inclusive of the expected range of construction risks, and so represent a range within which higher order estimates are expected to fall.
The Business Plan:
So, we have a firm estimate, and a sticker shock. Does a business plan support this expenditure?
The Economic Planning Group of Canada was contracted to answer this question. With the support of the Atlantic Canada Opportunities Agency, and estimates of economic impacts of tourism related activities in Nova Scotia using the province’s Tourism Economic Impact Model, EPG prepared our Economic Impact Study. This concluded that Battle of the Atlantic Place compared very favourably in terms of costs, benefits and visitor potential with other similar experience centres, such as the National WWII Museum in New Orleans and Titanic Belfast in Ireland.
I hope many of you have taken advantage of the opportunity to read their report recently distributed by
8 the Executive Director. It says many things, but key amongst them is that an experiential institution like Battle of the Atlantic Place is likely to attract as many as 240K visitors per year, about 40K of whom would be new to Nova Scotia. In other words, Battle of the Atlantic Place would be one of the more visited paid attractions in Atlantic Canada, a significant factor for governments to hoist in.
Another key factor is that 2,504 jobs would be created during construction and 618 directly and indirectly afterwards. Given the annual visitorship and the job creation numbers, these translate into an annual addition to GDP during construction of $131M, and annually thereafter of $7M, with annual off-site spending of $20M yielding a further yearly increase to GDP of $12.7M. There would also be tax revenues to the federal government of $13.6M during construction and $1M annually to Canada and Nova Scotia as a result of each year’s operations, with the $20M off-site annual spending yielding a further $1.2M to each. Presuming the three levels of government fund up to $180M of the cost, it’s calculated that the public investment would be returned in 15-20 years.
But can Battle of the Atlantic Place sustain itself once built?
EPG’s report estimated the annual cost of operations to be about $5M. Looking around the world and conservatively basing ticketing on that of similar institutions based on 240K visitors (e.g. 60% of Titanic Belfast rates and less for schools), then adding concession revenue and typical fees for event rental, annual operating revenues would exceed $5M. Adding in the value of any tax deferrals negotiated with HRM, then annual operations are expected to break even or better, meaning no pressure for annual top-up from the public purse, a relatively unheard of circumstance. Because of the conservative nature of our assumptions, it is possible that Battle of the Atlantic Place could operate at very attractive price points to the general public, something which National Parks and Museums, for example, cannot do.
This is the basis of the business plan that we are now advancing to the three levels of government. The Standing committee of Community Programming and Economic Development of Halifax Regional Municipality has been the first to receive the full presentation, and it was very well received. They have tasked city staff to provide a report and recommendation based on our request for funding, and staff have asked for further information to help them with that assessment. While CPED has capped their guidance to staff at levels less than our ‘ask’, final numbers will be a political decision and pressure can be applied for more. The major point is that HRM seems poised to provide funding support to the project.
Now that the provincial election is over, we will be approaching the new Minister of Communities, Culture and Heritage. Towards this end, we have also been meeting with Waterfront Development Company Limited and they have agreed to reissue their support for the land, and have also agreed to facilitate meetings with planners in HRM and the Halifax Port Authority as the planning continues. Federally, we are awaiting a promised meeting with federal Ministers, and with our local MPs.
The Way Ahead:
So, what’s the plan to move ahead?
This slide is a generalization of the path and the phasing involved. [Speak to slide].
Challenges:
So, given what we think is a very credible vision, a positive business plan outline, and a reasonable way ahead, what is the problem with gaining the financial support needed?
9 The short answer is: we’re not sure. While we’re not getting clear responses from the province or the feds, there does seem to be two constant threads we hear about: restricted public cash flow and policy priorities.
Governments say they are reluctant to provide funds for projects that haven’t been budgeted and haven’t already gained significant public funding support. Even with funding support, finding funds within an election cycle means borrowing or displacing something else. Furthermore, it has become evident that the federal government in particular, is marching to policy drums that generally doesn’t include heritage in the sense our project represents. The idea seems to be concentrating on today’s cultural issues that will be tomorrow’s heritage and government legacy.
But all of this isn’t necessarily the whole story, and the truth may be that we have yet to successfully engage the broader constituency that is the voting public. To do that, the Battle of the Atlantic Place needs to be stood up. I hope we learn more from meetings planned over the summer and into the fall.
In general, the following themes are becoming clear:
• Unless carefully messaged, the capital cost estimate can produce a sticker shock first impression, which tends to be invariably negative. It’s critically important that all Trustees ensure that those they speak with have a complete understanding of the concept, its national and local importance, direct and indirect benefits, investment payback over time, and the ability of the facility to sustain itself without resorting to tax payer bailouts. The cost is not high when compared to other similar projects
• Considering priorities between capital funding and the funding for the Preparation Phase, the importance of the second has become more immediate. Until the Navy agrees to docking Sackville for essential maintenance, the Trust will be unable to provide the $500K backstop needed to stand up the Battle of the Atlantic Society. So, PWG efforts will be concentrated on finding alternate sources, and to this end regional MPs will be asked to support ACOA funding in collaboration with the province and HRM
• HRM support is key to gaining the support of higher levels of government. With BoAP being a new kind of project for municipal consideration, there is no clear process to map to, and no regulated limits on the amount of support that can be provided. Decisions will be political and the extent of HRM funding should be finalized by year’s end. While HRM support can positively influence the higher levels of government, the impact of this leverage is uncertain. What is certain is that without HRM support, other governments will probably not help
• WDCL has stated their preference to see a project like BoAP on the waterfront, and is very supportive. Although they are a minority landowner, they are very influential and will facilitate coordination to encourage the support of HRM and the Halifax Port Authority. They can also act as a conduit to the NS government
• Public awareness and active support is a key to success. We need to find corporate and national partners who have the ear and respect of citizens, and therefore politicians. The Royal Canadian Legion is such an example and may become a very significant ally. In addition to the public endorsement of a well-respected national institution, their partnership may allow access to Canadians through their well-established national network – something that we were unable to accomplish through our own chapter-building effort. They may also be able to help with fundraising
10
• The earliest BoAP can be built is 5 years, and that assumes no delays in the ideal timeline. This means that the ship and its current operations have to be maintained through at least one more docking period, and perhaps more
This has been a fairly lengthy report but I thought it important for Trustees to have as clear a picture as possible of where the project is. The take-aways I suggest are:
• The project vision is sound and well supported at the conceptual level; • The business case is credible; • BoA can pay for itself; • What is missing is the constituency backing to influence political will to make it happen, and the funding support of corporate Canada. The two are symbiotic; • Both HRM and WDCL are positive and prepared to help with implementation; • We need to gain the support of respected national organizations and leverage public opinion, which being a major constituency element is an important key to gaining political support; and • There is still reason to remain positive – the economic fundamentals are solid
Thank you for your attention and subject to any comments and questions, that concludes my report.
Respectfully submitted, George Borgal, Chair, PWG
Annex F to 32nd AGM MINUTES Ships Operations Report
1. Since last year's AGM, also in late June, we experienced a strong summer and fall season with numbers up from 2015. This was in line with the other waterfront operators and was attributed to good weather and the weak dollar which kept Canadians home and attracted foreigners. While in 2016 there were no signature Halifax harbour events such as this year's Tall Ships, there were visitor highlights such as: - the General Romeo Dallaire visit in July, - in August, The Mayor manning the gangway for a watch, - the September shift to Pier 23 in support of the three-day DEFSEC which we plan for again this year, - the RCMP veterans' reunion visit and the Company of Master Mariners national AGM reception also in September, - a new social occasion - the ship's company/Duty Trustee appreciation BBQ in October, - the Royal Canadian Mint unveiling onboard of the commemorative Battle of the Atlantic two- dollar coin. This was quite a splash with four veterans celebrated and well covered in Action Stations, - also in October, just after our return to the Dockyard, a visit and lunch for 70 officers from the "five eyes" countries undergoing training at the Warfare Centre in Stadacona. This largely non- Canadian group marvelled that a private Trust could operate and maintain a historic warship that in their own countries would be a public institution. Winter activity was routine. It must be reported that the Dockyard security regime of recent years relaxed last fall with effect that ship access for our core working team and for those attending events became very reasonable. At the suggestion of some senior RCN personnel, we did experiment during the winter with two "open house" days for Dockyard military and civilian personnel. These worked very well. Additionally, we hosted visits of area Cadets, Scouts/Cubs, naval leadership courses and others.
11 It was hoped that the long-awaited docking would occur in this period but that was not the case. As a result, for the third year, the RCN provided the Trust with a replacement frigate for the Battle of the Atlantic Point Pleasant ceremony - this year HMCS Montreal. With painting weather arriving late this year, the team was rushed to complete the beautification in time for the move downtown. The ship did shift to the Museum wharf in early June to meet a longstanding filming commitment and to take part in Doors Open Halifax which did bring 925 visitors in one very busy Sunday. We then had to return to the Dockyard to embark our large gangway which wasn't ready for the first move. Our regular open season began this Monday (26 June). 1. Personnel: We are seeing the results of a hiring an additional CBM/shipkeeper last year. The extra horsepower in leadership onboard simply gets more done. The overall condition of the ship is improved and being commented on. The A/CBM, Kevin Waterman has also taken over the Gift Shop, a longstanding volunteer position. Here we are also seeing increased activity. The CBM has also improved communications with the Navy manning pool resulting in more RCN sailors being loaned to us. Add to that our hired summer staff to guide visitors and run the ticketing and gift shop, we are robustly and efficiently staffed for the beginning of this season. I must also mention our recently established Duty Trustee rotation which provides real depth and background to our "visitor experience". Thanks to Bert Walker for establishing this program and for hosting the two winter training sessions. 2. 2016/17 Maintenance and Preservation: When you visit, you will note the beautifully refurbished long gangway and maybe even the reseated fo'c'sle bollards which had been condemned in this Spring's hull survey. This important work was completed within our annual RCN Provision of Services agreement. You will also notice a second gangway. The not very attractive second gangway is there to meet a Transport Canada two-gangway access safety requirement. It is not our final solution which we expect to be a neat, small gangway off the quarterdeck. The ultimate, secondary gangway is taking some time to design. While the ship internally and externally looks the best she has in years, there are very serious concerns with condition of the deeper hull. We still await the Ottawa approval of the Docking Work Package Provision of Services (POS) agreement with DND. This matter will have been described by the Chair by this time in the meeting. 3. Interpretation and Presentation: Finally, I would like to note that it is a constant challenge to present the ship and her story in a professional and polished way, given our limited resources in the curatorial department. That is an area where we certainly hope to improve. So, I'm pleased to conclude with the assessment that we are in better condition starting this season than we've been in a long time but we do grapple with critical hull preservation and safety issues about which you have heard.
Submitted by: Jim Reddy, Captain
Annex G to 32nd AGM MINUTES Membership Report
New Members 2017: Eleven new Life Members and ten new annual members to date.
Membership Budget: Budget - $7,000 Expended to date: $2,265.59
12 Funds remaining: $4,734.65 Expenditures include: Canada Post, Name tags, Donor Recognition Plaques, Donor Honour Board plus engraving. Anticipated expenses: marketing in Trident, Lookout and Warrior, new poster display units, postage, name tags, donor recognition plaques.
Membership Initiatives for 2017:
1. Stronger connection with MFRCs and Veterans organizations. 2. Complete a standardized poster/promotion/mbrship application/donation form display. 3. Limited advertising in Trident, Lookout and Warrior. 4. Additional articles on family/friends for Action Stations, et al. 5. Better presence during HMCS SACKVILLE education events in liaison with Steve Rowling. 6. Ensuring membership has profile in the revamped CNMT website. Intend making a bigger push on memberships once the new website is operational. 7. Stronger presence during the NDWCC/United Way annual campaign for memberships and general donations. 8. Briefing provided to St. Margaret's Bay Seniors Association on 20 April. Excellent turnout. 9. Information kiosk at the Bay Expo, St. Margaret's Bay, 27 May. Attendance over 500.
Donor Recognition Programme:
Donor Honour Board for 2010 to 2016 has been completed and has been installed onboard.
2017 Major Donors to date: Jan to Mar timeframe - four. Apr to Jun timeframe - seven.
Major Donor Recognition Programme: $500 - $2499 Convoy Class Supporter $2,500 - $4,999 Corvette Class Supporter $5,000 - $9,999 Frigate Class Supporter $10,000 – $24,999 Destroyer Class Supporter $25,000 - $49,999 Cruiser Class Supporter $50,000 - $99,999 Carrier Class Supporter $100,000 - $249,999 Division Level Supporter
Annex H to 32nd AGM MINUTES Public Relations Report
As in years past, planning for upcoming Battle of the Atlantic (BOA) commemorative events started in early January with the usual team of volunteers in place. This year was particularly unique with the staging of the two largest events much reduced to alleviate the work load on the planning team.
The first, the ever-popular BOA concert featuring the Royal Canadian Navy's Stadacona Band in its 19th season, was shifted to Halifax's new and magnificent Central Library - the recipient of a Governor General’s Medal in Architecture in 2016. The concert was our signature piece for the 150th anniversary of Confederation and as a gift to the community, no admission was charged. Our underlying aim to bring our story to a new demographic - young families and university students - was a complete success with all 340 seats occupied and more than a hundred standing in the back or lining the staircases of the facility. A special shout out to volunteers Tim Friese, Steve Rowland, Pat Charlton and Heather Armstrong who manned the membership and information displays before and after the concert.
13 We are already booked for BOA next year but in the meantime, we are working with the Stad Band to host a commemorative concert in recognition of the 100th anniversary of the Halifax Explosion. "A Moment in Time" will be held on Sunday, 26 November, at the Central Library.
The second, was our most successful and enjoyable Battle of the Atlantic Dinner. For the past three years, we have been exploring different venues for the dinner as it became more popular and our numbers expanded. For two years, the Maritime Museum of the Atlantic hosted our event beautifully but this year we shifted to the Officers' Mess at the Wardroom. This move was to reduce the strain on the planners who in the past had to assemble rented furniture and set the tables - all in the one hour after the museum closed and our diners arrived. This year it was all done for us and we couldn't have asked for a better setting than the historic Wardroom. A special thank you to Steve Rowland who was away with the Kootenay survivors at a special ceremony in Ottawa, but still did all the place cards before he left. A thank you also to Roxanne Smith and Carl Anderson, Elaine Tuft, Wendall and Jean Brown for their help with the dinner.
Londonderry Pilgrimage:
Planning continues for our May 2018 pilgrimage to Northern Ireland and we already have a strong contingent of Trustees interested in attending. As usual this is a no-host event although we are guests of the Royal Naval Association and Ulster Canadian Initiative.
This next visit will be particularly poignant with the consecration of the third bell, to commemorate the convoys between Halifax, St. John's and Londonderry. The first two bells reside in Halifax and Londonderry. The third bell, while founded in Northern Ireland, will reside in St. John's.
The original intent of the bell initiative was to place bells in locations of strategic significance to the Battle of the Atlantic – symbolically triangulating the communities of St. John’s, Halifax and Londonderry.
We are raising funds to assist in the manufacture of the bell. If you wish to donate to this important project please contact the pilgrimage coordinator at [email protected]
ACTION STATIONS!
Our magazine continues to evolve and expand. And we are still looking for a replacement editor. Last year, we reduced the number of issues from four to three to alleviate the workload of gathering material, editing and design on our thin resources. While we are pleased with the design concept and thank the Navy for providing modern software to improve the look of the publication it still takes well over 150 volunteer hours of in-front-of-the-computer time to produce. As such, we are looking at alternatives for disseminating information and hope that our new website will fill this gap.
Thank you to our team consisting of Doug Thomas, Len Canfield, Steve Rowland and Debbie Findlay, and photographers Ian Urquhart, Bill Gard and Sandy McClearn for everything they do to assist.
VISITOR’S SURVEY:
In 2015, we conducted a survey to determine the effectiveness of our paid advertising the results are illustrated in the chart below:
14
During the 2016 season we focused on online marketing using social media, i.e. Twitter, Facebook, Instagram and one paid advertisement in Doers and Dreamers ($250.00+). This approach reduced the marketing costs of the PA budget by approximately $6,000.
The pie charts below indicate that 1% of our visitors in July and 4% in August became aware of the ship because of print advertising and the largest number of visitors were "walk bys." We intend to gather statistics again this summer but our thinking is that print advertising is not a contender in how we will promote the ship in the future.
In 2016, we also collected demographic information and it is interesting to note the large number of Canadian visitors. Perhaps a reflection on the weak dollar.
15 SOCIAL MEDIA
Twitter: Our account continues to grow at a steady rate consistent with other museum ships. To date we have approximately 3,080 national and international members representing a gain of over almost 500 new followers since the 2016 AGM. We are very pleased with our numbers and appreciate the regular contribution of Trustees from afar.
Recent activities of the Trust and the ship garnered a huge spike in activity. The first was the movement of the ship to her downtown berth and the second was the coverage of Trustee Fred Turnbull's Legion of Honour from the Republic of France.
TRIP ADVISOR: For the fifth year in a row HMCS Sackville has been awarded a Certificate of Excellence by Trip Advisor. We are maintaining our ranking of 10 out of 138 of places of interest to visit in Halifax. Of 268 reviews by visitors 147 rated their visit as excellent, 105 as very good and 15 as average.
AWARDS AND RECOGNITION: Lieutenant Governor of Nova Scotia's Queen's 90th Birthday Certificate of Volunteer Service Programme
We were very pleased to put forward the names of 37 individuals who qualified to receive the Volunteer Service Certificate by volunteering 90 hours aboard the ship in 2016 in commemoration of Her Majesty the Queen's milestone birthday. The program was initiated by Brigadier-General the Honourable J.J. Grant, CMM, ONS, CD (Ret'd), Lieutenant Governor of Nova Scotia.
IN CONCLUSION:
We are expecting another momentous summer on the waterfront especially on Canada Day and during Tall Ships in late July. We are always looking for more volunteers so if you have some time to spare please contact the Executive Director – Doug Thomas, 902 721 1206. Planners that can “own” an event from start to finish would be most welcome.
Submitted by: Pat Jessup, LCdr (ret’d) Chair – Public Affairs
16 Annex J to 32nd AGM MINUTES
WEBSITE WORKING GROUP REPORT
BACKGROUND: The CNMT Website WG stood up in the fall of 2016. The WG aims were: (1) to prepare a vision to articulate to a design company; and, (2) to develop, with the design company, a modernized website and all that that entailed, including maintenance, security and a marketing plan.
This is not a website refit but a full-blown modernization to develop a first-class website, taking advantage of the importance of social media. The maintenance and security for the website will be robust and will provide core updates, hosting support, performance support, daily backup and security protection. The marketing strategy will appeal to and retain: younger audiences; recruit new trustees; reach audiences external to Nova Scotia and promote wider awareness. A recommendation may be for a yearly baseline plan inserting key campaigns at specific times, e.g., prior to Battle of Atlantic and summer tourist season. Plan will include a review of business objectives, marketing strategy objectives, key performance metrics and media plan, etc. At this juncture, the Trust is only contracting for the strategy not its implementation.
After in-house WG meetings the team met with a full-service integrated marketing agency with an expertise in digital and social media – COLOUR. In early April 2017, three statements of work submitted by COLOUR were approved by CNMT Board of Directors - for website development and training, secondly, for maintenance and security; and, thirdly, to develop a website marketing strategy.
DISCUSSION: Since April, the WG team and COLOUR have had several meetings. To date layout designs and concepts have been progressed, the website map/navigation bar has been agreed, photos, historic and modern day are being amassed, much text has been drafted by the team for input and the final look and feel – font, colours, etc., are being finalized. The intent is to brighten the site through the use of bolder colours like blue and gold to grab your attention and create a WOW factor.
The site will focus on Sackville and the Battle of the Atlantic and not expand into a pan-naval resource. It will be clean and flow in a logical manner. It will retain some aspects of the current site such as Book of Remembrance and Committal of Ashes, the capability to conduct online membership and donations, Action Stations!, the Trust organization, but much superfluous text that had accumulated over the years has been removed. An important aspect of the new site is that it will maintain a current and future ship’s program. Two trustees will receive the appropriate training to input updates on news and events or any other matter.
The new site should go live in early August, if not before. Concurrent with that the maintenance contract will kick in and a small training package will be initiated. The marketing strategy is currently in development by COLOUR and our first review of it will be early July. Depending on the price tag it is hoped to include the execution of the strategy, or aspects of it, in next year’s budget.
CONCLUSION: The implementation of a new website with its support mechanisms and a marketing plan, as described in this note, are essential to the future success of HMCS Sackville. Without a modern platform that will appeal to potential new trustees, especially youth, the risk to the long-term viability of CNMT is in jeopardy. It is critical to success that we recognize the need to maximize the current and future trends in social media and what they can offer to the ship and the Trust.
Submitted by: KJ Pickford, Chairman: CNMT Website WG
17 Annex K to 32nd AGM MINUTES The Future and Challenge
The CNMT is at a critical time, SACKVILLE is three years overdue for a refit on the naval syncrolift. Authority and funding for the refit requires the approval of the Minister of National Defence. The request for approval of the Provision of Services Agreement has been in NDHQ for his signature for three years. I have been working through the Commander Maritime Forces Atlantic to exert pressure to gain the required signature and also to clarify the Navy's interest and intentions with respect to SACKVILLE as the Naval Memorial.
Annex L to 32nd AGM MINUTES
CNMT BOARD OF DIRECTORS: 2017-2018 1. Wendall Brown Chair CNMT
2. Jim Reddy CO HMCS Sackville
3. Bryn Weadon Treasurer, Investment Committee
4. Debbie Findlay Financial Administrator
5. Pat Jessup Public Affairs, Editor ACTION STATIONS!
6. Richard Oland Chair, Membership Committee
7. John Pickford Chair, Website WG
8. William Gard Recording Secretary
9. Steve Rowland Director Education, Duty Trustee Coordinator
10. Tony Goode
11. Dean McFadden
12. Dennis May
13. Neil Black
14. Roger Chiasson
15. Christopher Elson
16. Peter Stoffer
17. Gordon Burns
18. Bill Woodburn
18 Annex M to 32nd AGM MINUTES
WORKNG COMMITTEES:
PROJECT WORKING GROUP – BATTLE OF THE ATLANTIC PLACE
George Borgal Chairperson Hugh Macpherson Corporate Sponsorship / Communications Nancy Margeson Fundraising Gary Reddy Member Whitman Trecarten Member Wendall Brown Member Roger Chiasson Member William Gard Member Bruce Belliveau Member Doug Cooke Webmaster Jennifer Gamble Researcher
EXECUTIVE COMMITTEE: Doug Thomas Chairperson/ Web Site Committee Debbie Findlay Financial Administration/Membership Committee Pat Jessup Chairperson Public Affairs Len Canfield Member, Public Affairs Dennis May Chiefs and Petty Officer’s Association Representative Sherry Richardson NS-NAC Representative Carl Anderson Member Steve Bloom Member Bill Gard Member
ADVISORS TO THE BOARD: Bryan Elson Past Chairperson Doug Thomas Executive Director Sean Layden Legal Advisor Brian Flemming
19 AGENDA 33 nd ANNUAL GENERAL MEETING CANADIAN NAVAL MEMORIAL TRUST 1:15 PM JUNE 28 2018 –NOVA SCOTIA ROOM WARDROOM OFFICERS’ MESS, CFB HALIFAX, NS
ITEM I Welcome and Introduction by Chairman Wendall Brown a) Prayer for departed Trustees Padre Andrew Cooke b) Introduction of out-of-town Trustees and Board Wendall Brown
ITEM II Approval of Minutes for 32nd AGM – June 28 2017 Bill Gard
ITEM III Chairman’s Report Wendall Brown
ITEM IV Treasurer's Report Bryn Weadon
MOTION 1: Financial Statement – Approval Bryn Weadon
MOTION 2: Approval of Auditors Report Bryn Weadon
ITEM V Investment Committee Report Bryn Weadon
ITEM VI Ship’s Operations Report Jim Reddy
ITEM VII Membership Report Richard Oland
ITEM VIII Public Relations Report Pat Jessup
ITEM IX Ratification and Confirmation: Bill Gard
MOTION: Moved that all actions and conduct of the Board of Directors of the Canadian Naval Memorial Trust, made or undertaken on behalf of the Trust, up to date 28 June 2018, be and are ratified and confirmed.
ITEM X Election Board of Directors Bryan Elson Proposed Board of Director Slate for 2018/2019
ITEM XI Presentations
ITEM XII Adjournment
1 THE CANADIAN NAVAL MEMORIAL TRUST
FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2017 CONTENTS
Page
Independent Auditors' Report 1
Statement of Financial Position 2
Statements of Operations and Changes in Operating Fund 3
Statements of Preservation Fund Operations and Changes in Preservation Fund 4
Statements of Canadian Naval Memorial Project Fund Operations and Changes in Canadian
Naval Memorial Project Fund 5
Statements of Endowment Fund Operations and Changes in Endowment Fund 6
Statement of Cash Flows 7
Schedule of Operating Fund Expenses 8
Notes to the Financial Statements 9 - 14
THE CANADIAN NAVAL MEMORIAL TRUST STATEMENT OF FINANCIAL POSITION AS AT DECEMBER 31, 2017
Canadian Naval Memorial Operating Preservation Project Endowment Fund Fund Fund Fund 2017 2016 $ $ $ $ $ $ ASSETS CURRENT ASSETS Cash 67,706 60,918 7,960 136,584 213,568 Accounts receivable (including government remittances of $6,460; 2016 - $4,532) 8,505 858 9,363 11,143 Inventories 22,277 - 22,277 21,610 Prepaid expenses 9,002 9,002 9,540 Due from Canadian Naval Memorial Project Fund 1,420 1,420 839 Due from Preservation Fund 114,438 114,438 105,619 223,348 60,918 8,818 293,084 362,319
CAPITAL ASSETS (note 4) 42,424 9,442 51,866 36,035 ARTIFACTS (note 4) 5,458 - 5,458 5,458 LONG-TERM INVESTMENTS (note 5) - 2,010,521 114,959 60,192 2,185,672 2,180,132 271,230 2,071,439 133,219 60,192 2,536,080 2,583,944 LIABILITIES CURRENT LIABILITIES Accounts payable and accrued liabilities 16,528 3,684 1,669 21,881 16,670 Due to Operating Fund 114,438 1,420 115,858 106,458 Deferred revenue 8,000 - - 8,000 3,000 24,528 118,122 3,089 145,739 126,128 TRUST SURPLUS OPERATING FUND 246,702 246,702 304,463 PRESERVATION FUND 1,953,317 1,953,317 1,913,334 CANADIAN NAVAL MEMORIAL PROJECT FUND 130,130 - 130,130 190,943 ENDOWMENT FUND 60,192 60,192 49,076 271,230 2,071,439 133,219 60,192 2,536,080 2,583,944 APPROVED ON BEHALF OF THE BOARD
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2 THE CANADIAN NAVAL MEMORIAL TRUST STATEMENTS OF OPERATIONS AND CHANGES IN OPERATING FUND FOR THE YEAR ENDED DECEMBER 31, 2017
2017 2016 $ $ REVENUE
Ship Operations Donations - Sea chest 16,400 6,564 Ticket sales 36,205 32,456 Donations - General and Trustees 78,301 223,770 Donations - Life memberships 22,200 23,600 Donations - Memorials 2,633 4,055 Special donations 27,997 33,418 Miscellaneous revenue 8,550 16,064 Grant revenue (note 9) 6,608 6,688 Endowment fund administration fee 491 385 Gift shop sales (note 6) 15,034 25,803 Sackville Mess (note 7) 14,719 17,729
229,138 390,532
EXPENSES Ship operations (See schedule) 122,873 108,240 Administration (See schedule) 161,466 153,544 Promotion and publicity (See schedule) 38,214 41,258 Gift shop (note 6) 24,587 29,713 Sackville Mess (note 7) 13,320 13,648
360,460 346,403
LOSS ON DISPOSAL OF CAPITAL ASSETS (1,439) -
(DEFICIENCY) EXCESS OF REVENUE OVER EXPENSES FOR THE YEAR (132,761) 44,129
OPERATING FUND - beginning of year 304,463 218,514
TRANSFER FROM PRESERVATION FUND 75,000 41,820
OPERATING FUND - end of year 246,702 304,463
3 THE CANADIAN NAVAL MEMORIAL TRUST STATEMENTS OF PRESERVATION FUND OPERATIONS AND CHANGES IN PRESERVATION FUND FOR THE YEAR ENDED DECEMBER 31, 2017
2017 2016 $ $
REVENUE Donations 6,064 17,893 Dividends 20,678 17,864 Interest 37,292 38,159 Gain on disposal of investments 265,815 38,753
329,849 112,669
EXPENSES Investment fees and bank charges 14,997 14,292 Foreign exchange gain (53) (72) Endowment fund administration fee 491 385
15,435 14,605
EXCESS OF REVENUE OVER EXPENSES BEFORE UNREALIZED (LOSS) GAIN ON INVESTMENTS 314,414 98,064
UNREALIZED (LOSS) GAIN ON INVESTMENTS (199,431) 186,145
EXCESS OF REVENUE OVER EXPENSES FOR THE YEAR 114,983 284,209
PRESERVATION FUND - beginning of year 1,913,334 1,670,945
TRANSFER TO OPERATING FUND (75,000) (41,820)
PRESERVATION FUND - end of year 1,953,317 1,913,334
4 THE CANADIAN NAVAL MEMORIAL TRUST STATEMENTS OF CANADIAN NAVAL MEMORIAL PROJECT FUND OPERATIONS AND CHANGES IN CANADIAN NAVAL MEMORIAL PROJECT FUND FOR THE YEAR ENDED DECEMBER 31, 2017
2017 2016 $ $
REVENUE Dividends 5,481 3,469 Foreign investment income (loss) (48) 539 Gain on disposal of investments 16,140 12,747 Donations 2,899 6,920 Donations in kind 2,500 - Interest 36 497
27,008 24,172
EXPENSES Administrative support 44,286 45,152 Bank charges 131 151 Professional fees 1,767 4,743 Printing and stationary 6,423 3,962 Travel and meetings 881 3,463 Rent 7,375 7,719 Amortization 2,360 3,677 Telephone 1,842 1,778 Special projects - 246
65,065 70,891
DEFICIENCY OF REVENUE OVER EXPENSES BEFORE OTHER ITEMS (38,057) (46,719)
UNREALIZED (LOSS) GAIN ON INVESTMENTS (22,162) 4,841
LOSS ON DISPOSAL OF ASSETS (594) -
DEFICIENCY OF REVENUE OVER EXPENSES FOR THE YEAR (60,813) (41,878)
CANADIAN NAVAL MEMORIAL PROJECT FUND - beginning of year 190,943 232,821
CANADIAN NAVAL MEMORIAL PROJECT FUND - end of year 130,130 190,943
5 THE CANADIAN NAVAL MEMORIAL TRUST STATEMENTS OF ENDOWMENT FUND OPERATIONS AND CHANGES IN ENDOWMENT FUND FOR THE YEAR ENDED DECEMBER 31, 2017
2017 2016 $ $
REVENUE Donations 11,116 10,284
EXCESS OF REVENUE OVER EXPENSES FOR THE YEAR 11,116 10,284
ENDOWMENT FUND - beginning of year 49,076 38,792
ENDOWMENT FUND - end of year 60,192 49,076
6 THE CANADIAN NAVAL MEMORIAL TRUST STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2017
2017 2016 $ $
CASH FLOWS PROVIDED FROM OPERATING ACTIVITIES: Cash provided from operations Deficiency of revenue over expenses for the year - Operating Fund (132,761) 44,129 Excess of revenue over expenses for the year - Preservation Fund 114,983 284,209 Deficiency of revenue over expenses for the year - Canadian Naval Memorial Project Fund (60,813) (41,878) Excess of revenue over expenses for the year - Endowment Fund 11,116 10,284 Items in income not involving cash Amortization 13,924 12,158 Loss on disposal of property, plant and equipment 2,033 - Gain on disposal of investments (281,955) (51,500) Unrealized loss (gain) on investments 221,593 (190,986) (111,880) 66,416 Change in non-cash working capital balances Accounts receivable 1,780 2,103 Inventories (667) (2,978) Prepaid expenses 538 147 Accounts payable and accrued liabilities 5,211 (8,818) Deferred revenue 5,000 - (100,018) 56,870
CASH FLOWS USED IN FINANCING ACTIVITIES Proceeds on disposal of long-term investments 316,908 158,839 Acquisition of long-term investments (262,086) (233,766) 54,822 (74,927)
CASH FLOWS USED IN INVESTING ACTIVITIES: Acquisition of capital assets (31,788) (699)
CHANGE IN CASH DURING THE YEAR (76,984) (18,756)
CASH - beginning of year 213,568 232,324
CASH - end of year 136,584 213,568
7 THE CANADIAN NAVAL MEMORIAL TRUST SCHEDULE OF OPERATING FUND EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2017
2017 2016 $ $
Ship operations Miscellaneous 3,757 3,294 Wages 82,114 64,008 Repairs and maintenance 20,333 27,513 Summer employment 16,669 13,425
122,873 108,240
Administration Bank charges 2,764 3,250 Amortization 11,564 8,481 Insurance 16,475 16,424 Postage 183 1,576 Memberships 2,880 4,649 Miscellaneous 8,882 3,732 Professional fees 10,015 9,544 Office supplies 2,720 2,997 Telephone 2,045 718 Travel 27,384 33,527 Stipend and wages 76,554 68,646
161,466 153,544
Promotion and publicity Action Stations newsletter 13,526 13,705 Advertising and promotion 13,560 8,580 Memorial activities and awards 10,093 17,614 Postage 910 708 Website 125 651
38,214 41,258
8 THE CANADIAN NAVAL MEMORIAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2017
1. NATURE OF OPERATIONS
The objectives of the Canadian Naval Memorial Trust are to sustain appreciation of our national heritage through the preservation and promotion of the contributions made by Canada's Navy; to honour those who sacrificed their lives and to remember those who served in the naval service of Canada; to produce, operate and maintain an Interpretation Centre of Canadian Naval and associated maritime history, with HMCS Sackville as the symbol of national achievement in the Second World War; to acquire by way of grant, gift, purchase, bequest, devise, or otherwise, real and personal property and to use and apply such property to the realization of the objects of the Trust; and to buy, own, hold, lease, mortgage, sell and convey such real and personal property as may be necessary or desirable in the carrying out of the objects of the Trust.
2. SIGNIFICANT ACCOUNTING POLICIES
The financial statements were prepared in accordance with Canadian accounting standards for not-for-profit organizations (ASNPO) and include the following significant accounting policies:
Cash and Cash Equivalents The company's policy is to disclose bank balances under cash and cash equivalents, including balances held at a financial institution.
Inventory Inventory is stated at the lower of cost and net realizable value. Cost is determined on a first-in, first-out basis.
Capital Assets Capital assets are stated at cost. Amortization is provided for using the declining balance method over the estimated useful lives as follows:
Computers 55% Equipment and furniture 20%
The website will be amortized on a straight-line basis over five years.
Artifacts Artifacts purchased by the Trust for the ship are capitalized at cost and are not amortized as their useful life is unknown. Artifacts donated to the Trust include items in the foundation artifact, archival, fine art and display and research collections and are recorded as donations in kind in accordance with the revenue recognition policy below. The cost of capitalizing these donated items would exceed the incremental benefit.
Financial Instruments
Measurement of Financial Instruments The Trust initially measures its financial assets and liabilities at fair value, except for certain non-arm’s length transactions, which are measured at the exchange amount.
The Trust subsequently measures all its financial assets and financial liabilities at amortized cost, except for investments in equity instruments that are quoted in an active market, which are measured at fair value. Changes in fair value are recorded through the statements of Preservation Fund operations and Canadian Naval Memorial Project Fund operations.
Financial assets measured at amortized cost include cash and accounts receivable.
Financial liabilities measured at amortized cost include accounts payable and accrued liabilities. 9 THE CANADIAN NAVAL MEMORIAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2017
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
Financial Instruments (continued)
The Trust’s financial assets measured at fair value include long-term investments.
Impairment Financial assets measured at cost are tested for impairment when there are indicators of impairment. The amount of any write-down is recognized in net income. Any previously recognized impairment loss may be reversed to the extent of the improvement, directly or by adjusting the allowance account, provided it is no greater than the amount that would have been reported at the date of the reversal had the impairment not been recognized previously. The amount of any reversal is recognized in net income.
Transaction costs The Trust recognizes its transaction costs in net income in the period incurred. However, financial instruments that will not be subsequently measured at fair value are adjusted by the transaction costs that are directly attributable to their origination, issuance or assumption.
Revenue Recognition Fund Accounting The Trust follows the restricted fund method of accounting for donations.
Operating Fund Donation revenue received for the regular operations is recorded on a cash basis. Amounts received for life memberships are recognized as revenue in the operating fund. Non-monetary artifact donations are recorded at appraised values and are recognized as revenue when received. Donations of shares are recorded at the fair market value of the shares at their donation date. Interest income is recorded using the accrual method of accounting. Revenue from the gift shop, Sackville Mess and ticket sales is recognized on the date the goods are sold. Revenue from grants is recorded in the operating fund based on the terms of the underlying grant.
Canadian Naval Memorial Project Fund The Canadian Naval Memorial Project Fund is an internally restricted fund that has been established by the Trust for the promotion and development of The Battle of the Atlantic Place Project. Donations received for the Canadian Naval Memorial Project Fund are recognized as revenue in that fund. Revenue from grants is recorded in the Canadian Naval Memorial Project Fund based on the terms of the underlying grant.
Preservation Fund An internally restricted preservation fund has been established by the Trust for the purpose of preservation of the ship. The income earned on the Preservation Fund investments is being used from time to time as the Board of Directors determines it is necessary for the on-going preservation of the vessel. Donations and bequests are recorded as income in the Preservation Fund in the period they are received. Donations of shares are recorded at the fair market value of the shares at their donation date. Investment income is recorded using the accrual method of accounting.
Endowment Fund An externally restricted endowment fund has been established by the Trust. The income earned on the Endowment Fund investments is recognized in the Preservation Fund. Donations and bequests are recorded as income in the Endowment Fund in the period they are received. Donations of shares are recorded at the fair market value of the shares at their donation date. The Endowment Fund is subject to an administration fee as determined by the Board of Trustees.
10 THE CANADIAN NAVAL MEMORIAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2017
2. SIGNIFICANT ACCOUNTING POLICIES (continued)
Government Assistance Government assistance is recorded on the financial statements when there is reasonable assurance that the Trust has complied with, and will continue to comply with, all conditions necessary to obtain the assistance. Property, plant and equipmnet grants are accounted for as a reduction of the cost of the asset. Operational grants are accounted for as a reduction of the applicable expense.
Restoration Expenses The costs of HMCS Sackville's restoration are expensed as incurred.
Trust Surplus The Canadian Naval Memorial Trust allocates its surplus based on expected future use as follows: (i) Operating Fund - available for annual operations and maintenance and general use of the Trust; (ii) Preservation Fund - available for the preservation of the ship. (iii) Canadian Naval Memorial Project Fund - available for the long-term conservation of the ship. (iv) Endowment Fund - available for the long-term conservation of the ship.
Contributed Services Volunteers contribute services to the Trust. Because of the difficulty in determining fair value, contributed services are not recognized in these financial statements.
Use of Estimates The preparation of financial statements in accordance with Canadian accounting standards for not-for-profit organizations requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the current period. These estimates are reviewed periodically and adjustments are made to income as appropriate in the year they become known.
3. FINANCIAL INSTRUMENTS
Risks and Concentrations The Trust is exposed to various risks through its financial instruments. The following analysis provides a measure of the Trust’s risk exposure and concentrations at the balance sheet date.
Credit Risk The Trust is exposed to credit risk on the accounts receivable from its members. In order to reduce its credit risk, the Trust has adopted credit policies which include the regular review of their members' credit limits. The Trust does not have a significant exposure to any individual member or counterpart. The Trust has not incurred any bad debt expense for the last two years.
Market Risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk. The Trust is mainly exposed to currency risk and price risk.
Currency Risk The Trust follows the temporal method of accounting for the translation of foreign currency amounts into Canadian dollars. Under this method, monetary assets and liabilities denominated in foreign currencies are translated into Canadian dollars at the exchange rate in effect at the balance sheet date. Non-monetary assets are translated at the historical rate of exchange. Revenue and expenses are translated at the rate of exchange prevailing on the transaction date. Gains and losses on translation are reflected in income.
11 THE CANADIAN NAVAL MEMORIAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2017
3. FINANCIAL INSTRUMENTS (continued)
Price Risk Price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market. The Trust is exposed to other price risk through its investments in quoted shares.
4. CAPITAL ASSETS AND ARTIFACTS 2017 2016 Accumulated Cost Amortization Net Net $ $ $ $ Computers 46,280 44,808 1,472 3,327 Equipment and furniture 90,391 63,435 26,956 32,708 Website 29,298 5,860 23,438 -
165,969 114,103 51,866 36,035
These assets are held for both the Operating Fund and the Canadian Naval Memorial Project Fund.
The asset value of HMCS Sackville is recorded at $1 and the asset value of the model HMCS Sackville artifact is recorded at $5,458. These assets are not amortized as they have an indefinite useful life.
5. LONG-TERM INVESTMENTS
At December 31, 2017, the long-term investments are comprised of: Market Market Cost Value Cost Value 2017 2017 2016 2016 $ $ $ $ Preservation Fund RBC Dominion Securities 335,040 467,255 406,628 513,373 Seamark Asset Management 1,362,909 1,541,476 1,064,990 1,469,696 Cash surrender value of life insurance 1,790 1,790 1,977 1,977
1,699,739 2,010,521 1,473,595 1,985,046
Canadian Naval Memorial Project Fund RBC Dominion Securities 112,639 114,959 121,528 146,010
Endowment Fund RBC Dominion Securities 60,192 60,192 49,076 49,076
1,872,570 2,185,672 1,644,199 2,180,132
Any unrealized gain/loss for the investments held in the endowment fund are recognized in the preservation fund in the year they occur.
12 THE CANADIAN NAVAL MEMORIAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2017
6. GIFT SHOP OPERATIONS
The following summarizes the activity in the gift shop: 2017 2016 $ $ REVENUE Gift shop sales 15,034 16,942 Calendar sponsorship - 5,687 Calendar sales - 3,174
15,034 25,803 COST OF SALES Gift shop purchases 16,086 12,113 Calendar purchases 400 8,104
16,486 20,217
GROSS PROFIT (1,452) 5,586
EXPENSES Bank charges 45 47 Wages 8,056 9,281 Supplies - 168
8,101 9,496
DEFICIENCY OF REVENUE OVER EXPENSES FOR THE YEAR (9,553) (3,910)
7. SACKVILLE MESS OPERATIONS
The following summarizes the activity in the mess: 2017 2016 $ $ REVENUE 14,719 17,729
EXPENSES Bank charges 11 30 Bar purchases 7,609 7,784 Food and supplies 5,700 5,584 Manager's stipend - 250 13,320 13,648
EXCESS OF REVENUE OVER EXPENSES FOR THE YEAR 1,399 4,081
13 THE CANADIAN NAVAL MEMORIAL TRUST NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2017
8. FUNDING ARRANGEMENTS
The DND-CNMT Agreement was entered into during 1989 and provided $100,000 per year, if available, for support services with an additional amount provided during the docking year. The agreement for the hull service/refit was renegotiated subsequent to year-end as described in note 10 and negotiations are ongoing regarding annual services to be provided.
The funding provided by this agreement was not administered by the Trust and, as such, was not reflected in the accompanying financial statements. The Trust is responsible for preservation of the vessel and other administrative expenses only, while the DND-CNMT Agreement is meant to provide needed maintenance.
The Trust receives contributions-in-kind by way of free rent for premises, the value of which is not practically determinable and, therefore, is not recorded in the financial statements.
9. GOVERNMENT ASSISTANCE
During the year, the Trust applied for and was awarded a grant from the Canadian Summer Jobs Program in the amount of $6,608. The grant was recognized as revenue in the Operating Fund in the current year, and $6,688 in the prior year.
10. SUBSEQUENT EVENTS
Subsequent to year end, an agreement was reached between the Trust and the Department of National Defense relating to the hull service/refit. The Deparment of National Defense will provide the Trust with $3,500,000 to cover the cost of the refit. The hull service/refit began subsequent to the end of the 2017 fiscal year with the Department of National Defense advancing $1,400,000 of the funds.
Subsequent to year-end, the Trust entered into an agreement for $97,750 including HST for asbestos removal on the HMCS Sackville which was required to be completed prior to the hull service/refit.
14 REGISTRATION FORM ANNUAL CONTRIBUTION TO THE CANADIAN NAVAL MEMORIAL TRUST AND ANNUAL GENERAL MEETING –NOVA SCOTIA ROOM CFB HALIFAX WARDROOM, HALIFAX, N.S. THURSDAY 28 JUNE 2018 @ 1:15 PM
Name: ______Rank:______Address: ______City/Town: ______Prov: ______Postal Code: ______Phone: ( ) ______Year you joined the Trust: ______Member # (if known): ______Email: ______@______Annual Member-Trustee (Gold Level Supporter) or Life Member-Trustee (Platinum Level) Contribution Annual Member-Trustee Donation ($75.00 or more) or $______Life Member-Trustee – One time donation $1000 OR by $______10 consecutive monthly payments of $100 paid by Cheque or Credit Card Additional Donation(s) Canadian Naval Memorial Preservation Fund: ...... $ ______Canadian Naval Memorial Operating Fund: ...... $ ______In Memoriam: Name: ______Rank_____ Date of Passing: ______$______Membership + Donation Sub-Total: $______Annual General Meeting Events: Yes No AGM (Wardroom / NS Room 28 Jun @ 1:15PM) ______Coffee/Tea ($5) $ ______Reception (Juno Tower/The Bridge @ 5:00 PM) ______Cash Bar, finger foods ($15) $ ______AGM Events + Membership + Donation Total: $ ______
Cheque enclosed: Yes ____ No ____ (Payable to CNMT) Charge to my Mess Bill: Yes ____ No ____ Pay by: Visa, MasterCard, AMEX #: ______
Name on Card ______Expiry ____/_____
I authorize the use of this credit card (initial appropriate space) to:
1. Pay the above amount: Yes_____/ No ____
2. Renew my membership on an annual basis for the amount of $______: Yes_____/ No ____
3. Pay my Mess bill: Yes_____/ No ____
______Date Signature Online Membership, Renewal and/or Donation payments: www.canadasnavalmemorial.ca Note: If you are not attending the AGM then please use the attached form to make your annual contribution in the event you have not already done so. The Trust needs and appreciates your continuing support. Thank you. Contributions of $10 or more are Tax Deductible: Charitable No: BN 11883 4720 RR0001