COUNCIL MEETING OCTOBER 22, 2019 NORTHERN SUNRISE COUNTY COUNCIL CHAMBER 9:30 AM Page

AGENDA NORTHERN SUNRISE COUNTY COUNCIL MEETING OCTOBER 22, 2019 NORTHERN SUNRISE COUNTY COUNCIL CHAMBER 9:30 AM Page

1. CALL THE MEETING TO ORDER

2. ADOPTION OF THE AGENDA

3. ADOPTION OF THE MINUTES

4. BUSINESS ARISING OUT OF THE MINUTES/UNFINISHED BUSINESS

5 - 9 4.1 Kelly Petraschuk, Alberta Rural Development Network, September 16, 2019 RE: Alberta Rural Coalition on Housing and Homelessness ARCH2 Introduction to the ARCH2 Reply

10 - 15 4.2 RFD: Bylaw B365/19 Intermunicipal Collaboration Framework between Northern Sunrise County and Mackenzie County No. 23 Bylaw B365/19 Intermunicipal Collaboration Framework between Northern Sunrise County and Mackenzie County No. 23 - Pdf

5. PUBLIC WORKS

6. ENGINEERING, PLANNING & DEVELOPMENT

16 - 17 6.1 2019 Development Permits List Update October 16, 2019 Development Tracking Sheet Council October 16 2019

7. FINANCE

18 - 20 7.1(a) EFT Payment List #5416 to #5504 EFT List

21 - 22 7.1(b) Cheque List #55413 to #55445 Cheque List

23 - 26 7.1(c) Charitable Donations Tally Council Grants & Charitable Donations 2019

8. ECONOMIC DEVELOPMENT & COMMUNITY SERVICES NORTHERN SUNRISE COUNTY COUNCIL AGENDA October 22, 2019 Page 2 of 272

27 - 68 8.1 Étienne Alary, Executive Director Conseil de développement économique de l'Alberta, October 2, 2019 RE: Transition for HANA Committeee to Hemp Fibre Development HANA Letter HANA Business Plan_Sept 2019

69 8.2 Norm Duval, President, Mighty Peace Tourism, Octoober 8, 2019 RE: Mighty Peace Tourism Municipal Membership Fees for 2020 MPTA Municipal Fees 2020

70 - 144 8.3 1:00 p.m. with Dan Dibbelt Sunrise Park 2019 Development Strategy Northern Sunrise County - SGBP 2019 Development Strategy Appendix A - Sunrise Park - Phase Development Map Appendix B - Population By Gender and By Municipality Appendix C - Retail Market Summary - PREDA Region Appendix D - Traffic Counts - 2018 Summary - HWY 2 at HWY 688 Appendix E - Alberta Agriculture Exports Appendix F - Entrepeneur Grant Appendix G - AB Municipal Tax Incentive Appendix H - Entrepreneurial Bootcamp Schedule Appendix I - Gasoline Alley

9. PROTECTIVE SERVICES

10. AGRICULTURAL SERVICES

11. NEW BUSINESS

11.1 Invitations

11.1(a) Remembrance Day Ceremony November 11, 2019 in Nampa, AB **Starts at 10:45 a.m. Sharp** **RSVP Required** **The County annually donates $500 to each hosting organization**

11.1(b) Remembrance Day Ceremony November 11, 2019 in Peace River, AB **Starts at 10:45 a.m. Sharp** **RSVP Required** **The County annually donates $500 to each hosting organization**

145 11.1(c) Northern Sunrise County Protective Services Fire Departments Awards Banquet, December 6, 2019 in St. Isidore, AB **RSVP Required** NORTHERN SUNRISE COUNTY COUNCIL AGENDA October 22, 2019 Page 3 of 272 Fire Department Awards Banquet

146 11.1(d) Peace River School Division Joint Meeting with the Board of Trustees February 4, 2020 in Grimshaw, AB **RSVP Required** PRSD Joint Muni's Meeting

147 11.1(e) Rural Municipalities of Alberta Member Conference Call Regarding the Provincial Budget, October 25, 2019 RMA Budget Conference Call

148 - 149 11.2 Notes from the Governance & Priorities Committee Meeting held October 8, 2019 Governance & Priorities Committee - 08 Oct 2019 - Minutes - Pdf

150 11.3 Measuring the Costs and Benefits of Energy Transitions Team, University of Alberta, Future Energy Systems, October 9, 2019 RE: Renewable Energy Projects Survey for Council **Survey to be Completed** Renewable Energy Survey Request

151 - 165 11.4 RFD: Bylaw B364/19 Regional Assessment Review Board Bylaw Bylaw B364/19 Regional Assessment Review Board Bylaw - Pdf

12. COMMITTEE/REEVE/COUNCILLOR REPORTS

166 - 172 Councillor Boisvert Committee Report Councillor Boisvert October 22 2019 Calgary Energy Roundtable Program Guide

173 - 174 Deputy Reeve Duval Committee Report Deputy Reeve Duval October 22 2019

175 - 176 Councillor Williams Committee Report Councillor Williams October 22 2019

177 Councillor Gall Committee Report Councillor Gall October 22 2019

178 - 179 Reeve Kolebaba Committee Report Reeve Kolebaba October 22 2019

180 Councillor Whitehead Committee Report Councillor Whitehead October 22 2019

NORTHERN SUNRISE COUNTY COUNCIL AGENDA October 22, 2019 Page 4 of 272 13. CHIEF ADMINISTRATIVE OFFICER’S REPORT

181 - 184 13.1 Chief Administrative Officer’s Report, Calendar, and 2019 Strategic Priorities Chart, and the Capital Action Items List October 8-21, 2019 CAO Report Strategic Priorities Chart 2019 2019 CAPITAL PROJECTS ACTION ITEMS

14. CORRESPONDENCE

185 - 266 14.1 Elaine Garrow, Chairperson, Peace Region Economic Development Alliance, Lisa Wardley, Chairperson, Regional Economic Development Initiative, September 30, 2019 RE: Northern Commodities - Agriculture Report PREDA Northwest Alberta Agriculture Commodities Letter Northern Commodities Ag Report

267 - 272 14.2 Karla Reesor, Executive Director, Peace River Area Monitoring Program Committee, October 16, 2019 RE: Alberta Airsheds Council Letter to Minister Nixon PRAMP Letter to Minister Nixon AAC letter to Minister Nixon

15. PUBLIC QUESTION PERIOD

16. CLOSED MEETING

16.1 11:30 a.m. with Matt Flette, Darcy Forman, Jennifer Paterson and Dave Rogen, Canadian Natural Resources Limited Third Party Proprietary Information FOIPP; Section 16

16.2 Legal Issue; FOIP; Section 27

17. ADJOURNMENT

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From: Kelly Petraschuk Date: September 16, 2019 at 11:25:31 AM MDT To: [email protected] Subject: Introduction to the ARCH2

Hello Carolyn & Team,

I hope this email finds you well! My name is Kelly Petraschuk and I work with the Alberta Rural Development Network. I am contacting you today to see if you would be interested in joining one of our initiatives – the Alberta Rural Coalition on Housing and Homelessness, or ARCH2! It is a great way to connect with organizations that understand rural issues similar to those you handle on a day to day basis.

The Coalition was started in late 2016 by the ARDN and several communities and organizations we work with in order to provide a united voice on rural housing and homelessness issues, as well as to connect smaller communities and groups from around the province. The ARCH2 currently has 15 members from across Alberta including ARDN and continues to grow quickly as more communities become interested in what the Coalition is doing. I have attached our information brochure to give you more details on what we are all about!

Full memberships are for rural-based individuals, organizations and municipalities outside the 7 cities. Affiliate memberships are available to individuals, organizations and municipalities working in the 7 cities, or outside of Alberta. Fees and benefits are the same for full and affiliate members, except affiliates do not have the opportunity to be elected to the executive.

Yearly Fees are as follows: Individual - $20 (restricted to the individual) Organization - $50 (may designate a primary representative and an alternate) Municipality - $100 (may designate a primary representative and an alternate)

If interested, we will need two things from you to begin:

1) A signed Promise & Declaration form (which is essentially just a non-disclosure agreement that ensures that anything said at ARCH2 meetings remains between ARCH2 members). The form is attached.

2) Your organization's address (for the invoice), and the names and contact information (phone and email) for your primary and secondary (if desired) representatives on the ARCH2.

If you are interested in becoming a member, please send your signed Promise and Declaration by replying to this email at [email protected] (saying that you are joining the ARCH2) and I will proceed with your membership. Please feel free to connect with me if you have any questions about the ARCH2 or any other initiatives the ARDN is currently involved with - www.ardn.ca. We look forward to having you on board!

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From: Kelly Petraschuk To: Jocelyn Gagnon Subject: RE: Introduction to the ARCH2 Date: October 1, 2019 9:48:03 AM Attachments: image001.png image003.png

Hi Jocelyn, Sorry for the late reply to your email from last week – I was away from the office for a few days and am just now getting to a backlog of emails!!

So, here is some more information on the ARCH2 that you can relay back to your Council:

What does the municipality get from becoming a member?

· You will be connected to a network of municipalities and organizations working to address homelessness and housing issues across rural Alberta;

· You will be the first to learn about ARDN or ARCH2 events/publications - opportunities to volunteer for the CRRHH symposium planning committee (discounted tickets to the symposium), be part of new and exciting pilot projects e.g. 20 communities;

· First to know about new grants and funding opportunities, new research and data on rural homelessness and housing;

· Gives you opportunities to participate in stakeholder consultations; · Gives you opportunities to be part of advisory committees for ARDN-led initiatives (ie. Step- by-Step Guide to Building Affordable Housing, Guide to Estimating Rural Homelessness)

· Networking opportunities at the annual general meeting and other events hosted by ARDN or ARCH2 (e.g. affordable housing seminar)

What is the expectation of a municipality if they become a member? Is a designate required to become a member? How often and where are meetings held?

· One representative from each member organization is required to participate (in-person or via teleconference) in 3 virtual meetings per year; A secondary representative can be noted upon joining, in case the primary representative is unable to attend.

· One in-person meeting is held every year, with the option to call in; Representatives are encouraged to share updates on issues, successes, and/or challenges their organization/municipality is currently working on.

· The option of being part of the CRRHHS Planning Committee is available, but not required. · Current and previous members have indicated that the most valuable part of being a member of the ARCH2 is the collaborative network. By connecting with other communities, members have been able to share best practices with one another and leverage existing partnerships especially for those in a similar region. · Teleconferences held quarterly, in-person once a year · You are not required to appoint a designated member. However, to fully reap the benefits of Page 7 of 272

becoming part of the ARCH2, it is encouraged that the same individual(s) attend the meetings.

What other municipalities have become members?

· Currently the following Municipalities are part of the ARCH2 – County of Grande Prairie, City of Chestermere, Town of Canmore, Town of Strathmore, Town of Fort Macleod, Town of Bonnyville

I hope I have answered all your questions – if I’ve missed something, please don’t hesitate to contact me again! In summary, the ARCH2 is a great connecting mechanism for rural communities throughout Alberta to share information and best practices. We try to keep the registration costs low to ensure that every community – big or small- can be a part of the ARCH2! Let me know what you ultimately decide!

Regards,

Kelly Petraschuk Office Manager & Executive Assistant to the Executive Director Alberta Rural Development Network +1.780.964.2736 200, 10578-113 Street NW, Edmonton, Ab T5H 3H5 [email protected] www.ardn.ca We’ve Moved!! Our new address is: #200, 10578-113 Street Edmonton, AB T5H 3H5

From: Jocelyn Gagnon [mailto:[email protected]] Sent: September 25, 2019 3:36 PM To: '[email protected]' Subject: RE: Introduction to the ARCH2

Good Afternoon Kelly,

Council reviewed this information at the regular Council meeting yesterday and has asked for more information.

What does the municipality get from becoming a member?

What is the expectation of a municipality if they become a member? Page 8 of 272

Is a designate required to become a member? How often and where are meetings held?

What other municipalities have become members?

Thanks

[email protected] | www.northernsunrise.net

From: Kelly Petraschuk Date: September 16, 2019 at 11:25:31 AM MDT To: [email protected] Subject: Introduction to the ARCH2

Hello Carolyn & Team,

in what the Coalition is doing. I have attached our information brochure to give you more details on what we are all about!

If interested, we will need two things from you to begin:

1) A signed Promise & Declaration form (which is essentially just a non- disclosure agreement that ensures that anything said at ARCH2 meetings remains between ARCH2 members). The form is attached.

2) Your organization's address (for the invoice), and the names and contact information (phone and email) for your primary and secondary (if desired) representatives on the ARCH2.

Page 10 of 272

Request for Decision Council - 22 Oct 2019

Topic: Bylaw B365/19 Intermunicipal Collaboration Framework between Northern Sunrise County and Mackenzie County No. 23

Administrative Recommendation: That Council give third reading to Bylaw B365/19 Intermunicipal Collaboration Framework between Northern Sunrise County and Mackenzie County No. 23 as presented.

Background: Council gave first and second reading to Bylaw B365/19 Intermunicipal Collaboration Framework between Northern Sunrise County and Mackenzie County No. 23 as presented at the October 8, 2019 regular Council meeting.

The Intermunicipal Committee consisting of the Reeve, Deputy Reeve, and Chief Administrative Officer have worked with Council and Administration of Mackenzie County to develop an Intermunicipal Collaboration Framework in accordance with the Municipal Government Act (MGA).

Mackenzie County will be presenting their Bylaw to Council in October 2019 as well.

IMPLICATION OF DECISION

Financial Implications: None

Policy and/or Legislative Implications: 1. Municipal Government Act Section 708.27 states that "The purpose of this Part is to require municipalities to develop an intermunicipal collaboration framework among 2 or more municipalities".

Public Consultation Required: None

Attachments: 1. Bylaw B365/19 Intermunicipal Collaboration Framework (ICF) between Northern Sunrise County and Mackenzie County No. 23.

Alternative Options: 1. Council could defeat third reading of Bylaw B365/19 Intermunicipal Collaboration Framework between Northern Sunrise County and Mackenzie County No. 23.

REVIEWED AND APPROVED FOR SUBMISSION TO COUNCIL

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Page 2 of 6 Department Manager: Date: October 10, 2019 Jocelyn Gagnon Chief Administrative Date: October 10, 2019 Officer: Cindy Millar

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BYLAW NO. B365/19

BEING A BYLAW FOR THE PURPOSE OF ADOPTING THE INTERMUNICIPAL COLLABORATION FRAMEWORK BETWEEN NORTHERN SUNRISE COUNTY AND MACKENZIE COUNTY NO. 23

WHEREAS, Section 708.28(1) of the Municipal Government Act, being Chapter M-26 of the Statutes of Alberta, as amended, mandates that municipalities that have common boundaries must create an Intermunicipal Collaboration Framework with each other that identifies the services provided by each municipality, which services are best provided on an intermunicipal basis, and how services to be provided on an intermunicipal basis will be delivered and funded;

WHEREAS, Northern Sunrise County and the Mackenzie County share a common border; and

WHEREAS, Northern Sunrise County and the Mackenzie County have reviewed their common interests and are desirous of working together when appropriate to provide services to their residents; and

WHEREAS, the Municipal Government Act (MGA) stipulates that municipalities that have a common boundary must create an Intermunicipal Collaboration Framework with each other that identifies the services provided by each County, which services are best provided on an intermunicipal basis, and how services to be provided on an intermunicipal basis will be delivered and funded.

NOW THEREFORE, by mutual covenant of the Counties hereto it is agreed as follows:

A. TERM AND REVIEW

1. In accordance with the Municipal Government Act, this Intermunicipal Collaboration Framework shall come into force on final passing of matching bylaws that contain the Framework by both Counties. 2. This Framework may be amended by mutual consent of both Counties unless specified otherwise in this Framework. 3. It is agreed by the Counties that the Councils shall review this Framework at least once every four years, commencing no later than 2022, the terms and conditions of the agreement.

B. INTERMUNICIPAL COOPERATION

1. The Councils of each County shall be the forum for reviewing the Intermunicipal Collaboration Framework.

C. GENERAL TERMS 1. Both Counties agree that in consideration of the service agreements outlined in Section D, any costs in the future that require Intermunicipal agreements shall be dealt with on a case by case basis. D. MUNICIPAL SERVICES 1. Both Counties have reviewed the services offered to residents. Based on the review it has been determined that each County will continue to provide the following services to their residents independently: a. Transportation b. Water c. Wastewater d. Solid Waste e. Emergency Services f. Recreation 1

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E. FUTURE PROJECTS & AGREEMENTS

a. In the event that either County initiates the development of a new project and/or service that may require a new cost-sharing agreement, the initiating County’s Chief Administrative Officer will notify the other County’s Chief Administrative Officer in writing.

F. DISPUTE RESOLUTION

1. The Counties are committed to resolving any disputes in a non-adversarial, informal, and cost- efficient manner.

2. The Counties shall make all reasonable efforts to resolve all disputes by negotiation and agree to provide, without prejudice, open and timely disclosure of relevant facts, information and documents to facilitate negotiations.

3. In the event of a dispute, the Counties agree that they shall undertake a process to promote the resolution of the dispute in the following order: a. Negotiation; b. Mediation, and c. Binding arbitration.

4. If any dispute arises between the Counties regarding the interpretation, implementation or application of this Framework or any contravention or alleged contravention of this Framework, the dispute will be resolved through the binding Dispute Resolution Process outlined herein.

5. If the Dispute Resolution Process is invoked, the Counties shall continue to perform their obligations described in this Framework until such time as the Dispute Resolution Process is complete.

6. Despite F(4), where an existing intermunicipal agreement has a binding dispute resolution process included, the process in the existing intermunicipal agreement shall be used instead of the dispute resolution outlined in this Framework.

7. A party shall give written notice (“Dispute Notice”) to the other party of a dispute and outline in reasonable detail the relevant information concerning the dispute. Within thirty (30) days following receipt of the Dispute Notice, the respective Councils shall meet and attempt to resolve the dispute through discussion and negotiation, unless a time extension is mutually agreed by the Chief Administrative Officers. If the dispute is not resolved within sixty (60) days of the Dispute Notice being issued, the negotiation shall be deemed to have failed.

8. If the Counties cannot resolve the dispute through negotiation within the prescribed time period, then the dispute shall be referred to mediation.

9. Either party shall be entitled to provide the other party with a written notice (“Mediation Notice”) specifying: a. The subject matters remaining in dispute, and the details of the matters in dispute that are to be mediated; and

b. The nomination of an individual to act as the mediator.

10. The Counties shall, within thirty (30) days of the Mediation Notice, jointly nominate or agree upon a mediator.

11. Where a mediator is appointed, the Counties shall submit in writing their dispute to the mediator and afford the mediator access to all records, documents and information the mediators may reasonably request. The Counties shall meet with the mediator at such reasonable times as may be required and shall, through the intervention of the mediator, negotiate in good faith to resolve their dispute. All proceedings involving a mediator are agreed to be without prejudice and the fees and expenses of the mediator and the cost of the facilities required for mediation shall be shared equally between the Counties.

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Page 5 of 6

12. In the event that: a. The Counties do not agree on the appointment of a mediator within thirty (30) days of the Mediation Notice, or.

b. The mediation is not completed within sixty (60) days after the appointment of the mediator; or

c. The dispute has not been resolved within ninety (90) days from the date of receipt of the Mediation Notice, either party may by notice to the other withdraw from the mediation process and in such event the dispute shall be deemed to have failed to be resolved by mediation.

13. If mediation fails to resolve the dispute, the dispute shall be submitted to binding arbitration. Either of the Counties may provide the other party with written notice (“Arbitration Notice”) specifying: a. the subject matters remaining in dispute and the details of the matters in dispute that are to be arbitrated; and b. the nomination of an individual to act as the arbitrator.

14. Within thirty (30) days following receipt of the Arbitration Notice, the other party shall, by written notice, advise as to which matters stated in the Arbitration Notice it accepts and disagrees with, advise whether it agrees with the resolution of the disputed items by arbitration, and advise whether it agrees with the arbitrator selected by the initiating party or provide the name of one arbitrator nominated by that other party.

15. The Counties shall, within thirty (30) days of the Arbitration Notice, jointly nominate or agree upon an arbitrator.

16. Should the Counties fail to agree on a single arbitrator within the prescribed time period, then either party may apply to a Justice of the Court of Queen’s Bench of Alberta to have the arbitrator appointed.

17. The terms of reference for arbitration shall be those areas of dispute referred to in the Arbitration Notice and the receiving party’s response thereto.

18. The Arbitration Act (Alberta) in force from time to time shall apply to arbitration proceedings commenced pursuant to this Framework.

19. The arbitrator shall proceed to hear the dispute within sixty (60) days of being appointed and proceed to render a written decision concerning the dispute forthwith.

20. The arbitrator’s decision is final and binding upon the Counties subject only to a party’s right to seek judicial review by the Court of Queen’s Bench on a question of jurisdiction.

21. If the Counties do not mutually agree on the procedure to be followed, the arbitrator may proceed to conduct the arbitration on the basis of documents or may hold hearings for the presentation of evidence for oral argument.

22. Subject to the arbitrator’s discretion, hearings held for the presentation of evidence and for argument are open to the public.

23. If the arbitrator establishes that hearings are open to the public in Section 21, the arbitrator, at their sole discretion, may solicit written submissions. If the arbitrator requests written submissions they must be considered in the decision.

24. The fees and expenses of the arbitrator and the cost of the facilities required for arbitration shall be shared equally between the Counties.

25. On conclusion of the arbitration and issuance of an order, the arbitrator must proceed to compile a record of the arbitration and give a copy of the record to each of the Counties.

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G. CORRESPONDENCE

Written notices under this bylaw shall be provided to the Mailing Addresses of each respective Municipality and Attention to the Chief Administrative Officers.

SEVERABILITY PROVISION Should any provision of this bylaw be invalid then such invalid provision shall be severed and the remaining Bylaw shall be maintained.

EFFECTIVE DATE This bylaw shall come into force and effect when it receives third reading and is duly signed.

Read a first time this ____ day of _____, 2019.

Read a second time this _____ day of _____, 2019.

Read a third time this _____ day of _____, 2019.

Signed and made effective this _____ day of _____, 2019.

______Carolyn Kolebaba, Reeve Cindy Millar, Chief Administrative Officer

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Northern Sunrise County - Development Tracking Sheet Private & Commercial Developments Sub. Date Applicant Location Zone Development DO/MPC Approved Advertised Appeals 09-Sep-19 Lubicon Lake Band/NSC NW-11-86-14-W5M; Plan 8121420; Block 6; Lot 71 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 09-Sep-19 Lubicon Lake Band/NSC SW-16-86-14-W5M; Plan 8121430; Block 1; Lot 3 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 09-Sep-19 Lubicon Lake Band/NSC SW-16-86-14-W5M; Plan 8121430; Block 1; Lot 5 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 09-Sep-19 Lubicon Lake Band/NSC NE-10-86-14-W5M; Plan 8121430; Block 3; Lot 39 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 09-Sep-19 Lubicon Lake Band/NSC NW-11-86-14-W5M; Plan 8121420; Block 5; Lot 59 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 09-Sep-19 Lubicon Lake Band/NSC NE-10-86-14-W5M; Plan 8121430; Block 2; Lot 30 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 09-Sep-19 Lubicon Lake Band/NSC NE-10-86-14-W5M; Plan 8121430; Block 2; Lot 29 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 09-Sep-19 Lubicon Lake Band/NSC SW-11-86-14-W5M; Plan 8121420; Block 10; Lot 95 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 16-Sep-19 Lubicon Lake Band/NSC NW-10-86-14-W5M; Plan 9420933; Block 0; Lot 80 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None 16-Sep-19 Lubicon Lake Band/NSC NE-10-86-14-W5M; Plan 8121430; Block 3; Lot 56 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 16-Sep-19 Lubicon Lake Band/NSC SW-15-86-14-W5M; Plan 8121430; Block 1; Lot 8 LB Single Detached Dwelling DO 18-Sep-19 25-Sep-19 Page 17 of 272

Northern Sunrise County - Development Tracking Sheet Private & Commercial Developments Sub. Date Applicant Location Zone Development DO/MPC Approved Advertised Appeals

07-Nov-18 Wapiti Gravel Supplies E-17-90-14-W5M & SE-20-90-14-W5M F Gravel Pit MPC 25-Jan-19 06-Feb-19 No 13-Nov-18 Northern Sunrise County W-6-82-22-W5M & SE-1-82-23-W5M NRM Gravel Pit MPC 25-Jan-19 06-Feb-19 No

26-Nov-18 Peace Country Ventures SW-26-83-21-W5M; Plan 0621444; Block 1; Lot 1 RM Industrial Camp MPC NO No 11-Jan-19 Lavoie Ventures NW-24-83-21-W5M A Grain Bin DO 01-Feb-19 06-Feb-19 No 14-Mar-19 William Baars SE-22-81-20-W5M A Modular Home DO 19/03/2019 27-Mar-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121420; Block 5; Lot 59 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121420; Block 6; Lot 70 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121420; Block 10; Lot 95 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121420; Block 10; Lot 98 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 1; Lot 3 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 1; Lot 5 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 1; Lot 19 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 2; Lot 27 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 2; Lot 28 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 3; Lot 38 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 3; Lot 40 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 3; Lot 46 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 8121430; Block 3; Lot 53 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 9420933; Block 0; Lot 80 F Lot Clearing DO 02-Apr-19 10-Apr-19 None 18-Mar-19 Lubicon Lake Band/ NSC Plan 9420933; Block 3; Lot 77 F Lot Clearing DO 02-Apr-19 10-Apr-19 None

29-Mar-19 David Troup/ Don & Jackie GourNE-23-82-22-W5M A Single Detached Dwelling DO 08-Apr-19 10-Apr-19 None 05-Apr-19 Dianne Gunning NE-6-84-20-W5M A Detached Garage DO 10-Apr-19 17-Apr-19 None 13-May-19 Northern Sunrise County SW-23-83-21-W5M; Plan 0526120; Block 6; Lot 6 HD Building Expansion DO 15-May-19 22-May-19 None 15-May-19 Kristy Provost SE-15-82-19-W5M; Plan 1921310; Block 1; Lot 2 A Shop DO 22-May-19 29-May-19 None 21-May-19 Mark Sanderson SW-22-81-20-W5M; Plan 1920243; Block 1; Lot 1 A Dwelling Unit; Cottage DO 22-May-19 29-May-19 None

24-May-19 Rene Desfosses NE-27-83-21-W5M; Plan 7823144; Block 1; Lot A A Green house and Solar Panels DO 05-Jun-19 12-Jun-19 None

28-May-19 April Bentley SW-5-85-20-W5M A Single Detached Dwelling DO 05-Jun-19 12-Jun-19 None

Temporary Construction Facilities and 29-May-19 Phoenix North/ Three Creeks PowerNE-15 & SE-22-85-18-W5M F Power Generating Facility MPC 17-Jun-19 19-Jun-19 None 13-Jun-19 Savage CANAC Corporation SE-32-80-19-W5M; Plan 1325468; Block 1; Lot COS Transloading Project Specific Cargo MPC 17-Jun-19 19-Jun-19 None 19-Jun-19 Lubicon Lake Ventures SW-11-86-14-W5M; Plan 8120492; Lot A HP Training Centre DO 20-Jun-19 26-Jun-19 None 20-Jun-19 Kyle Dziengielewski SE-26-84-20-W5M A Modular Home DO 20-Jun-19 26-Jun-19 None 20-Jun-19 Proud Peace Ag SE-33-81-22-W5M A Grain Bins DO 20-Jun-19 26-Jun-19 None Manufactured Home and Detached 25-Jun-19 Julien Lavoie/Lavoie Ventures NW-15-83-20-W5M A Garage DO 03-Jul-19 10-Jul-19 None 15-Jul-19 Lubicon Lake Band & AEP SW-15-86-14-W5M DC Single Detached Dwelling Council 13-Aug-19 14-Aug-19 None Can Gas Propane Inc. & 16-Aug-19 1893177 Alberta Ltd. NW-23-83-21-W5M; Plan 07248/21; Block 5; Lot 5 MSG Propane Distribution Facility MPC 26-Aug-19 04-Sep-19 None 05-Sep-19 Dan Sandford NE-32-80-20-W5M; Plan 9121224; Block 1; Lot 1 A Garage DO 16-Sep-19 18-Sep-19 None 09-Sep-19 Lubicon Lake Band/NSC NE-10-84-14-W5M; Plan 8121430; Block 1; Lot 13 LB Single Detached Dwelling DO 16-Sep-19 18-Sep-19 None Page 18 of 272 Page 19 of 272 Page 20 of 272 Page 21 of 272

System: 30/09/2019 1:47:39 PM Northern Sunrise County Page: 1 User Date: 30/09/2019 COMPUTERCHEQUEREGISTER User ID: Randi Payables Management

Batch ID: CHQ20l9-0930 Audit Trail Code PMCHQ0000l734 Batch Comment: CHEQUEBATCHFOR SEPT30 ,20l9 GOVERNMENTREMITANCES Posting Date: 30/09/2019

Chequebook ID: ROYAL

* Voided Cheques

Cheque Number Date Payment Number Vendor ID Cheque Name Amoun t 00000000000000055413 30/09/2019 00000000000060714 AIC01 PEACE REGIONALABORIGINALINTE 000.00 0000000000000005541430/09/2019 00000000000060715 KELLER01 KELLER,TRENT 219.12 00000000000000055415 30/09/2019 00000000000060716 LONDON01 LONDONLIFE INSURANCECOMPANY 513.10 0000000000000005541630/09/2019 000000000000607l7 PRDCC01 PEACE RIVER & DISTRICT CHAMBER 000.00 0000000000000005541730/09/2019 00000000000060718 REVCAN01 REVENUECANADATAXATION 5 y 830.06 0000000000O000055418 30/09/2019 00000000000060719 TEMP00000000523 PEACE RIVER ROYALS 300.00

Total Cheques Cheques Total $ 141,862.28

-U>\II—'l—|-r—I|—‘*U)-U’) {I} Page 22 of 272 Page 23 of 272

Council Grants Charitable Donations 2019

Total Spent Amount Budget 2019 2019 Remaining $89,275 $200,000 $110,725

Organization 2016 2017 2018 2019 Approved Motion Contribution Contribution Contribution Contribution Number & Date Glenmary Cross-Country Team $325 746/10/08/19 Peace River Regional Women's Shelter - Festival of Trees $1,000 $1,000 $500 $500 738/10/08/19 Aboriginal Interagency Committee Sisters in Spirit Walk $2,000 $2,000 $1,000 $1,000 693/09/24/19 Peace River & District Chamber of Comm. Small Business Week $1,500 $3,000 $3,000 $1,000 691/09/24/19 Peace River High School Senior Boys Basketball Team $1,000 659/09/10/19 Peace Regional SPCA (12th Annual Tails on the Trail) $250 622/08/27/19 Nampa and District Historical Society (Wine Gala) $3,000 601/08/27/19 Peace River & District Chamber of Comm. Golf Tournament $400 $150 $250 540/07/23/19 Miserable Miles Event $5,000 $4,000 $4,000 539/07/23/19 Tri River Triathlon - Peace River $500 $500 $750 $750 430/06/11/19 RCMP Musical Ride Supper $500 404/05/28/19 $1,500 271/03/26/19 Cadotte Lake Metis Local #1994 - Seniors Week Event $600 400/05/28/19 Peace River Stampeders Baseball Club $400 397/05/28/19 Western Zones Racing Associaton - 2019 World Jet Boat Championships $10,000 385/05/28/19 Peace River Motocross Association $10,000 370/05/14/19 Town of Peace River RE: Canada Day Fireworks $2,000 $3,000 $3,000 $3,000 359/05/14/19 Beyond the Heart Clubhouse $5,000 326/04/23/19 Alberta Community Crime Prevention Association Conference $1,500 309/04/23/19 Heart River Golf Club Hole in One Golf Tournament $500 308/04/23/19 Aboriginal Interagency (Pow Wow) $5,000 $5,000 $20,000 $10,000 285/04/09/19 Coalition of Canadian Municipalities for Energy Action (C-69) $1,000 270/03/26/19 Peace River Senior Citizens Club (Seniors' Week) $600 $600 $600 269/03/26/19 McKinney Hall (Seniors' Week) $600 $600 269/03/26/19 Le Club du Bon Temps (Seniors' Week) $600 $600 $600 $600 269/03/26/19 Nampa Golden Pioneers (Seniors' Week) $500 $600 $600 $600 269/03/26/19 Veterans Memorial Gardens $750 263/03/26/19 Christmas Gift Card Program $5,000 $5,000 260/03/26/19 MD of Opportunity and Bigstone Cree Nation Charity Golf Tournament $500 256/03/26/19 Peace Region Dance Society $500 $1,000 219/03/12/19 Big Lakes Invitational Charity Golf Tournament $500 214/03/12/19 Nampa & District Minor Hockey $2,500 $2,500 187/02/26/19 $500 $500 $500 037/01/09/18 North Peace Navigators - Darcy Haugan Memorial Statue $2,500 150/02/12/19 Alberta Assessors' Association Annual Conference $1,000 112/01/29/19 Peace River Aboriginal Hockey - Native Provincials $500 $750 108/01/29/19 Peace River Aboriginal Interagency Committee Treaty 8 Monument $2,000 102/01/29/19 Smoky River Regional Economic Development Hemp Information Session $800 100/01/29/19 Alberta Pond Hockey Association $2,500 $2,500 $5,000 $5,000 099/01/29/19 Good Shepherd School Gr. 6 Visit to the Provincial Legislature $500 098/01/29/19 Town of Peace River Crime Prevention Through Environmental Design $2,500 081/01/29/19 Peace River Curling Club - MS Curl for a Cure Bonspiel $500 $500 $600 $500 044/01/08/19 Smoky River Agricultural Trade Show (SARDA) $5,000 $5,000 042/01/08/19 Peace River Shell Rotary House $18,000 003/01/08/19 Cadotte Lake Metis Local #1994 - Annual Christmas Party $2,000 $2,000 871/12/11/18 Salvation Army Food Bank $10,000 $15,000 $10,000 867/12/11/18 Peace River & District Chamber of Commerce Davis Awards $4,250 $2,500 865/12/11/18 $1,750 906/12/12/17 CPAA Conference Sponsorship $1,250 863/12/11/18 $1,750 $1,500 $1,250 220/03/27/18 Peace Regional Air Show Association $10,000 860/12/11/18 $7,500 $5,000 028/01/09/18 In The Woods Animal Rescue Society $5,000 845/12/11/18 Community Futures Women in the North Conference $2,500 824/11/27/18 $1,500 $5,000 $2,500 077/01/23/18 North Peace Performing Arts Festival $250 $500 $500 823/11/27/18 Families First Home Visitation Program - Christmas Program - Adopt a Family $1,000 $500 $500 822/11/27/18 Page 24 of 272

Council Grants Charitable Donations 2019

Organization 2016 2017 2018 2019 Approved Motion Contribution Contribution Contribution Contribution Number & Date North West Regional Skills Canada Competition $1,000 819/11/27/18 $1,000 140/02/27/18 Peace River Community Events Society (Peacefest) $20,000 $20,000 804/11/27/18 Peace River Cadets - Remembrance Day Ceremony - Nampa $500 $500 781/11/13/18 Peace River Curling Club - Junior Curling $1,000 777/11/13/18 Aboriginal Interagency Pow Wow Calendars $600 $600 772/11/13/18 PR Royal Canadian Legion - Remembrance Day - PR $500 $500 $500 771/11/13/18 Peace River Community Soup Kitchen $3,000 $3,000 727/10/23/18 Pawatum Peace Regional Sports Foundation $10,000 679/10/09/18 Falher Friendship Corner Associaton (new residence for assisted living clients) $10,000 650/09/25/18 Peace Regional Healthcare Retention & Attraction Committee $1,000 637/09/25/18 $1,000 $250 572/08/28/18 Peace River Seventh-day Adventist Church Outdoor Church Service $100 568/08/28/18 Northern Lakes College Golf Tournament Sponsorship (Gala 2019) $2,300 542/08/14/18 Peace Playland Association $3,000 488/07/09/18 Mighty Peace Watershed Alliance - 2018 Alberta WPAC Summit $2,000 410/06/12/18 Catholic Church of St. Isidore - Roadside Cleanup Committee $500 376/05/22/18 Peace River Boating Association - 2018 Gold Cup Jet Boat Races/Boat Launch Maintenance $5,000 373/05/22/18 Northern Heat Conference (Peace Regional Fire Chiefs) $5,000 $5,000 257/04/10/18 Heritage Towers (Seniors' Week) $600 $600 221/03/27/18 Lubicon Lake Band #453 (Seniors' Week) $600 221/03/27/18 Harmon Valley Ag Society (Seniors' Week) $500 $600 $600 221/03/27/18 Society of Local Government Managers of Alberta Conference $3,000 $3,000 $1,500 218/03/27/18 Mighty Peace Tourism Fan Fanatics $1,800 178/03/13/18 Peace Regional RCMP Community Advisory Committee, P.A.R.T.Y. Event 2018 $250 149/02/27/18 Assoc. of Professional Engineers & Geoscientists of AB - Science Olympics $700 $700 079/01/23/18 Watino River Boat Launch Association $8,800 076/01/23/18 Families First Home Visitation Program - Christmas Program $2,000 887/11/28/17 Le Café du Coin - St. Isidore Hot Lunch Meal Program $1,000 818/11/07/17 Peace River Curling Club - Cash Spiel $2,000 $1,000 743/10/10/17 Northern Sunrise Rural Crime Watch Association $500 $500 709/09/26/17 Mitchell Warne - American Kestral Nesting Box Program $1,800 668/09/12/17 Peace River & District Health Foundation (top off annual contribution) $10,000 $10,000 666/09/12/17 Almira Whitehead (2016 Annual Wagon Trail Ride) $2,000 $1,000 502/06/27/17 Metis Nation of Alberta Assembly $0 $500 433/05/23/17 Peace River 4H Multi Club $1,000 $1,500 417/05/23/17 Vision Credit Union Annual Charity Golf Tournament $500 369/05/09/17 Peace River Region Restorative Justice Association $1,000 212/03/14/17 Peace River Ski Club $25,000 192/03/14/17 Heart River Golf Club $32,000 179/02/28/17 Peace Regional Science Fair Bear Cave $500 $500 146/02/14/17 Lubicon Lake Band #453 (Ball Diamond pending) $10,000 099/01/23/17 St. Charles Parish Pastoral Council $5,000 098/01/23/17 Clear Hills County Annual Agricultural Trade Show $1,000 094/01/23/17 Sutherland Nursing Home Peace River Resident Council $1,500 904/12/13/16 Peace Regional Air Monitoring Project $25,000 854/11/22/16 St. Isidore Library $5,000 767/10/25/16 Growing the North Conference $1,500 765/10/25/16 Peace Valley Snowriders Poker Rally $1,850 702/09/27/16 Peace River Bantam "AA" Sabres Program Sponsorship $500 CAO Approved 27/09/16 Peace River Royals Midget AA Program Sponsorhip $500 CAO Approved 22/09/16 Peace River Skating Club $4,600 662/09/13/16 Alberta High School Rodeo Association $1,000 642/08/23/16 Shell Rotary House Dinner & Dance Gift Donation $100 640/08/23/16 MakePeace Foundation $1,000 577/07/26/16 Suicide Prevention Donation $225 CAO Approved North Peace Trappers Demos and Picnic $495 CAO Approved Town of Grimshaw Canada Day Event $100 CAO Approved Nampa & District Pioneer Museum (Museum Conference Expenses) $1,548 427/06/14/16 Lubicon Lake Band #453 (Cultural Programming - Little Buffalo) $15,000 395/05/24/16 Societe des Compagnons St. Isidore $10,000 373/05/10/16 Nampa & District Agricultural Society $819 302/04/12/16 Page 25 of 272

Council Grants Charitable Donations 2019

Organization 2016 2017 2018 2019 Approved Motion Contribution Contribution Contribution Contribution Number & Date North Peace Navigators $500 291/04/12/16 Peace River & District Chamber of Commerce Downtown Dash Event $3,000 267/04/12/16 Marie Reine Homecoming Picnic July 1-3/2016 $1,340 244/03/22/16 Peace River Ukranian Dance Club $500 221/03/22/16 Alberta Rural Municpal Administrators Association Conference $2,500 203/03/08/16 SongRise Music Conference & Showcase $3,500 103/01/26/16 Societe, École des Quatre Vents $6,800 102/01/26/16 Peace River Community Collaborative Group $5,000 083/01/26/16 Peace Regional Victim Services $5,050 050/01/12/16 Totals $163,177 $183,600 $193,250 $89,275 Page 26 of 272

Gift-in-Kind Charitable Donations 2019

2019 Total to Date $3,550

Organization Gift In Kind Donation 2018 2019 Approved Motion Number & Approximate Value of GIK Approximate Value of GIK Date Alberta Rural Crime Watch Provincial Symposium 200 Metal Drinking Straws 300 702/09/24/19 Region 6 Metis Nation of Alberta AGM Silent Auction Item 250 653/09/10/19 Peace River Healthcare Attraction & Retention Gift Basket Items 250 575/08/13/19 Alberta CARE Conference Silent Auction Item; drinking straws; mugs&chocolate 1500 542/07/23/19 FCSSAA Annual Conference Silent Auction Item 250 535/07/23/19 Town of Peace River Centennnial Event Use of Popcorn Machine and Supplies 402/05/28/19 Victim Services Golf Tournament $500 395/05/28/19 CARES Conference Silent Auction Item $250 188/02/26/19 North Peace Gymnastics Club Silent Auction Item $250 046/01/08/19 Knights of Columbus Lobster Dinner Silent Auction Item $200 253/04/10/18 Knights of Columbus Fishing Derby - Winagami Lake Lazy Bear chair $100 CAO Approved Victim Services Golf Tournament Cooler, hat, camp cups, water bottle, $50 Farmers GC $120 CAO Approved

Total $420 $3,550 Page 27 of 272

October 2, 2019

Northern Sunrise County 135 Sunrise Road Bag 1300 Peace River, AB. T8S 1Y9

To start, I want to thank Northern Sunrise County for their financial contribution to the HANA project. HANA plays an important role in stimulating and circulating information about the hemp fiber industry.

The HANA project is now complete, but the steering committee members want to continue the work that HANA started. At the August 22nd meeting a transition committee was put in place to ensure a good transition between HANA and the new province-wide association for hemp fiber development. The transition committee members include: Dan Madlung (BioComposites Group), Lori-Jo Graham (Alberta Agriculture & Forestry), Manny Deol (Clean Energy Technology Centre) and Diane Chiasson (CDEA).

At the final HANA meeting on October 24th, the transition committee will submit a proposal for a non- profit association structure with membership fees for municipalities, farmers and non-profit groups. Currently it is premature to know what the exact annual membership fee will be, but we are confident that the annual fee won’t be more than $3,000.

If you choose to continue to support the hemp fiber industry, we strongly recommended a representative on the board of directors to ensure a strong voice for the northwest region, also because it is a new association we suggest your Economic Development Officer attend the meeting as well as your council representative.

If you require more information, please contact Diane Chiasson at 780-837-6630 or at [email protected].

Étienne Alary Executive Director Conseil de développement économique de l’Alberta

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HANA Business Case to Attract Investment in the Hemp Fibre Value Chain in

Northern Alberta – Phase II

Prepared For

Hemp Alberta Northern Advantage (HANA)

Prepared By Serecon Inc.

September 2019

Page 29 of 272

Specialists in the business of agriculture WWW.SERECON.CA

September 4, 2019

François Catellier President Golden Meadow International Inc. 1 Blackberry Bay, Winnipeg, MB R2J 2G4

Mr. Catellier

RE: FINAL REPORT - HANA BUSINESS PLAN

We are pleased to provide you the Final Report for the HANA Hemp processing facility business plan. We appreciate the opportunity to have worked on this project and look forward to following the potential development of hemp processing in Northern Alberta.

As part of our analysis we have conducted extensive sensitivity and scenario analysis on the key cost and revenue drivers by geographic location for three facility sizes. While there is obviously subjectivity involved in some of the assumptions, we have been careful to qualify the impacts of these and suggest risk mitigation options.

Thank you for the opportunity to work with you on this project. Please do not hesitate to contact me directly with any questions and/or areas of clarification.

Yours truly, SERECON INC.

Enclosure

600, 10665 JASPER AVENUE EDMONTON, AB T5J 3S9 PHONE 780-448-7440 #180 MAPLE LEAF PROFESSIONAL CENTRE, 15 ROYAL VISTA WAY NW CALGARY, AB T3R 1T9 PHONE 403-216-2100 Page 30 of 272

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Table of Contents 1.0 EXECUTIVE SUMMARY ...... 1 2.0 INDUSTRY ANALYSIS - SUPPLY ...... 3

CANADA ...... 3 INTERNATIONAL...... 5 SUMMARY ...... 6 3.0 MARKET ASSESSMENT ...... 7

CONTEXT ...... 7 3.1.1 Canada...... 7 3.1.2 Global ...... 8 3.1.3 Processing ...... 9 MARKETING SEGMENTS ...... 9 3.2.1 Industrial Applications ...... 10 3.2.2 Construction Applications ...... 10 3.2.3 Food Service Sector ...... 11 3.2.4 Livestock and Pet Applications ...... 11 SUMMARY ...... 12 4.0 OPERATIONS ...... 13

OVERVIEW ...... 13 OPERATING COSTS ...... 13 4.2.1 Cost of Goods Sold ...... 14 4.2.2 Labour ...... 15 4.2.3 Utilities...... 17 4.2.4 Freight ...... 17 4.2.5 Overhead & Other Operating Costs ...... 19 CAPITAL COSTS ...... 20 4.3.1 Capacity Considerations ...... 20 4.3.2 Building Costs ...... 21 4.3.3 Land and Land Preparation ...... 23 4.3.4 Summary...... 24 5.0 FINANCIAL ASSESSMENT ...... 25

OVERVIEW ...... 25 ASSUMPTIONS ...... 25 5.2.1 Variable & Fixed Costs ...... 25 5.2.2 Plant Productivity by Size Category ...... 26 5.2.3 Price Benchmarks ...... 27 CRITICAL COST ASSUMPTIONS IMPACTING MODEL ...... 27 BREAKEVEN ANALYSIS ...... 28 5.4.1 Alberta HUB ...... 28 5.4.2 GROWTH Alberta ...... 28 5.4.3 GAER ...... 28 5.4.4 PREDA ...... 29 5.4.5 Summary...... 29 FINANCIAL PROJECTIONS ...... 29 SUMMARY OF RESULTS ...... 35 6.0 CONCLUSIONS ...... 37

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List of Tables

Table 1: Bio-Fibre Based Building Materials Importers (2016) ...... 11 Table 2: Required land relative to hemp straw yield ...... 14 Table 3: Labour Requirements ...... 15 Table 4: Population within 100 km ...... 16 Table 5: Electricity Requirements by Plant Size ...... 17 Table 6: Municipal Non-Residential Mill Rates and Total Tax Burden ...... 19 Table 7: Capacity Input Requirements ...... 20 Table 8: Building Requirements by Machine Size ...... 21 Table 9: Building and Equipment Costs ...... 22 Table 10: Breakdown of Install Cost: 4 MT/hr Decortication Plant ...... 22 Table 11: List of Other Equipment Purchases ...... 23 Table 12: Industrial Land Prices ...... 23 Table 13: Fixed Costs...... 25 Table 14: Variable Operating Costs ...... 26 Table 15: Variable Costs ...... 26 Table 16: Fibre, Hurd and Dust Production by Plant Size and Efficiency ...... 26 Table 17: Pricing Schedule ...... 27

List of Figures

Figure 1: Canadian Acres Plant to Hemp (2017) ...... 3 Figure 2: Area Seeded to Hemp in Alberta ...... 4 Figure 3: Daylight Hours ...... 5 Figure 4: 2017 Hemp Acres – Leading Producers ...... 5 Figure 5 : Global Hemp Imports ...... 8 Figure 6: 2013 European Union Hemp Fibre Domestic Disposition (MT) ...... 9 Figure 7: 2013 European Union Hemp Hurd Domestic Disposition (MT) ...... 9 Figure 8: REDA Groups ...... 13 Figure 9: Cost to Haul Straw to a 10 MT/hr Plant ...... 18 Figure 10: Transport Costs by Location to Edmonton ...... 18 Figure 11: Cash Flow in Year 4 Relative to Initial Investment ...... 35 Figure 12: Cash Flow Relative to Hemp Fibre Prices ...... 36

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1.0 Executive Summary

The purpose of this document is to assess the opportunity, and the marketing, operating and financial plans for the establishment of a 4 MT/hr, an 8 MT/hr and a 10 MT/hr hemp decortication plant on different site locations across northern Alberta. Each site location has contributing factors that give it advantages in key areas associated with building a hemp decortication plant. Some locations have more farmland in the surrounding region, others have advantages in access to a workforce, while others have lower municipal tax rates or industrial land values.

In our assessment, the key critical cost assumptions that differentiate the regions are tax rates, distance from export destination, distance to bring in hemp straw and industrial land values. This document will help the reader make an informed decision regarding various trade-offs related to investment in a decortication plant in northern Alberta.

One of the key assumptions that went into the economic model, and that was used to draw conclusions for this document, is that the market for hemp fibre continues to grow. While continued growth is a reasonable assumption, the extent of that growth has critical implications on the viability of the largest of the hemp decortication plants. Given the growing interest in hemp and the regulatory shift taking place in the United States, we have made the assumption that a 10 MT/hr plant will be able to sell all the fibre, hurd and dust it produces.

Our analysis shows that the 10 MT/hr plant, located in one of the more favorable site locations, has the potential to completely payback $12.7 million in invested capital (50% of the required capital expenditure) in four years of operation. The cash flow generated by the end of year 4 is roughly $22 million (for our example location), with a capitalization rate of 33%. The cash flow and capitalization rate both increase or decrease for every dollar per metric ton change in the price of hemp fibre. While the plant continues to accumulate cash flow if hemp fibre prices drop considerably, the payback period is pushed further out.

With the above conditions in mind, we recommended the following strategy for establishing a hemp decortication plant in northern Alberta:

• Build a 10 MT/hr hemp decortication plant to benefit from economies of scale and be able to take advantage of growing global demand for hemp products. Some companies will choose to grow into a large-scale plant, i.e. start with a scalable 4 MT/hr plant and grow larger as the customer base grows.

• Consider building in regions with either lower municipal tax rates or that are offering tax-free status in the first three years. Securing a three-year tax-free operating window shortens the payback period and increases the capitalization rate.

• Build the hemp decortication plant in a location that has abundant agricultural land in the surrounding region. If more hemp decortication

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plants are built in western Canada, there will be increased competition for supply, and it will be important to be in a region with large productive potential.

• Access to rail is a bonus but not necessary unless the decortication plant is located a considerable distance from markets (e.g. Peace River region shipping to Edmonton). If a plant is built in the northernmost site locations, then access to rail is a must.

The economic model shows that a 10 MT/hr decortication plant is resilient to price fluctuations in the cost of hemp straw and the price of hemp fibre on the world market. However, the conclusions drawn for this document are based on the assumptions outlined throughout.

The approach taken for this assessment recognizes that while there is risk involved if the price of inputs (hemp straw) climbs, or oversupply of hemp fibre causes prices to drop, the potential gains from getting in ahead of the expected growth in the global hemp demand are large. Besides the various reasons outlined in the Marketing Analysis and Marketing Segments sections of this document that lead us to believe there is going to be growth in global demand for hemp fibre, the regulatory shift taking place in the United States and the increasing global demand for sustainably produced products are stand-out contributing factors. Finally, given the apparent support at the national and provincial levels for crop diversification in the prairies, this would appear to be an opportune time to invest in hemp processing in Alberta.

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2.0 Industry Analysis - Supply

Can ad a Hemp cultivation was re-introduced in Canada in 1998. Over the past 20 years producers have gradually been building up sources of certified seed and processors have developed numerous hemp products. However, with the introduction of Canada’s Cannabis Act (2018), growers can process the hemp flowers, leaves, and branches in addition to just the seed. While seed has long been incorporated into a wide range of food products in Canada, the introduction of the new regulation is expected to further increase interest in growing hemp.

According to Health Canada, in 2017 Canada planted a total of 138,000 acres of industrial hemp (Figure 1). While hemp acres have fluctuated up and down over the past 10 years, it is likely that with the regulatory shift in the United States and the growing interest in hemp processing in Canada, producers are capable of increasing acreage in the coming years.

Figure 1: Canadian Acres Plant to Hemp (2017) 7,150

29,900 Saskatchewan 56,250 Alberta Manitoba Other 44,700

Source: Health Canada

Alberta accounts for roughly a third of Canada’s total hemp production, which is heavily concentrated in the Prairie Provinces (Figure 2). Alberta also holds the highest number of licenses for cultivating industrial hemp of all provinces in Canada. Farmers in northern Alberta have been experimenting with hemp cultivation for years. Research suggests they have the knowledge and agronomic techniques to successfully grow a 3.5 MT/acre crop (and growing), and they are ready for further investment in processing in the region to signal that it is time to increase area seeded.

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Figure 2: Area Seeded to Hemp in Alberta 50,000 45,000 40,000 35,000 30,000 25,000 Acres 20,000 15,000 10,000 5,000 - 2014 2015 2016 2017 2018 2019

Source: Statistics Canada and Government of Alberta

The drop in 2018 was directly related to overproduction in 2017. A key market for Canadian hemp had been South Korea, which reduced its purchases from Canada in 2017 because their consumption of hemp products declined, and they started importing from China at lower prices. However, hemp acres rebounded again in 2019. Fluctuations like this are not unusual in a new market scenario where supply chains are not fully developed. It does point to the importance of building relationships with producers in the region where a plant is to be built.

Northern Alberta is home to North America’s largest Research and Development Decorticator facility (Innotech Alberta Vegreville Site). The longer hours of sunshine (Figure 3) and cooler nights allow hemp to see a 30% increase in fibre and a higher concentration of omegas. The long dews advance retting allowing for optimum fibre quality.

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Figure 3: Daylight Hours

Source: Farmers’ Almanac

International In 2017, Canada planted 37% of global hemp acres, China planted 30%, the European 1 Union planted 27% and the United States planted 7%. (Figure 4).

Figure 4: 2017 Hemp Acres – Leading Producers 25,716 USA 115,313 Canada 138,013 EU China 105,016

Source: USA – Vote Hemp; Canada – Statistics Canada; EU – European Industrial Hemp Association; China – Heilongjiang Academy of Sciences

Hemp fibre is an expanding industry in China and has become the most popular fibre in the bast textiles market with 70% of total hemp grown used in textile industry. If hemp production continues to expand in China it could lead to more hemp fibre being incorporated in to manufactured goods, which could in turn increase demand for hemp on the global market. China is the global leader in producing industrial products produced with hemp as an additive. While China does not currently import a significant amount of hemp fibre (they supply their processing industry with domestically produced fibre), further interest in these products on the global market

1 Statistics on global hemp production come from a presentation at the 15th Conference of the European Industrial Hemp Association (EIHA) in Cologne, Germany, in June 2019.

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could expand the processing sector in China and require them to begin importing fibre. Canada is ideally located to supply this market.

For the last ten years, progress in the pulp and paper, insulation and bio-composites markets in the EU have seen steady growth. The growth of environmentally conscious consumers has helped to push this trend. France is the leading producer of hemp straw and intermediate processed fibre, with Germany and the Czech Republic leading the way regarding further processing.

While the United States currently trails the other three leading producers, this is expected to change given the latest developments in the 2018 Farm Bill. Since the early 1990’s, there has been sustained pressure pushing for commercial hemp cultivation again. In 2014, Congress took the first step by allowing some research institutions and state departments of agriculture to grow hemp under an agricultural pilot program. Finally, in 2018 the latest iteration of the Farm Bill directed the U.S. Department of Agriculture (USDA) to issue regulations and guidance to implement a program for the commercial production of industrial hemp in the United States. For the 2020 planting season, U.S. producers are hoping to have regulation in place for industrial hemp production in the United States. This could greatly increase the market for Canadian industrial hemp and hemp by-products.

Su mmary There are several significant changes in the supply chain that are of critical significance to the potential growth of the industry. Canada has made the regulatory changes to promote hemp production, and the world appears to be eager for hemp fibre, especially with the changes taking place in the United States.

While the momentum is very positive it is important that hemp production must increase in Alberta for a large hemp decortication facility to be viable. On the positive side, there were 34,600 acres of hemp planted in Alberta in 2019 and this is likely just the starting point for the industry. As markets mature this figure is expected to grow significantly. Alberta has the agricultural land and skilled producers capable of diversifying their crop rotations by adding hemp. This momentum will obviously increase as markets grow and supply chains become more mature.

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3.0 Market Assessment

Con tex t While the extent of the growth of the global hemp industry is dependent on investment in processing capacity and the development of markets, the growth is clearly taking place. This could spell incredible opportunity for Canada’s hemp industry, including farmers, processors, food manufacturers and researchers. Currently, Canada is the global leader in hemp production and is looking to further develop domestic manufacturing in the hemp sector in order to capture some of the growing global market.

The various marketing segments potentially open to hemp by-products from a hemp decortication facility in Alberta include industrial applications such as technical fibres for advanced industrial applications, non-wovens, (including growth mats and erosion mats) and natural semi-fabricated product for pressing composite materials, and hemp pellets for the injection molding industry. In addition, hemp products are being used for construction applications such as insulation, plate material for external wall insulation and roof construction, non-woven felt for sound absorption, and hemp blocks.

3.1.1 Canada In September 2018, the federal government announced investment of $330,550 CAD in the Canadian Hemp Trade Alliance (CHTA) to develop industry-wide grading standards so that Canadian hemp products could be recognized globally for their quality and consistency. In addition, the federal government has pledged investment of $950 million CAD towards transforming sectors of Canada’s economy to become global market leaders.

Protein Industries Canada (PIC), the newly created organization in Canada representing producers and processors of plant-based proteins, received $153 million CAD in federal funding to put towards projects to further develop the plant-based industry. As a positive sign that investment dollars are behind the hemp industry in Canada, in June 2019, PIC announced their first project investment of $8 million being allocated to creating new processing techniques for hemp and canola in Alberta. This will certainly increase the level of confidence for the industry as a whole and demonstrate long-term commitment to producers.

With projected growth at the global level of between $10-15 billion USD and considerable investment in Canada towards hemp processing, the foundation is set for hemp in Canada to capitalize on the projected growth in the hemp industry south of the border. Canada and the United States trade roughly $25 billion CAD in agriculture and agri-food products on an annual basis, making it the largest bilateral agri-food trading relationship in world. Therefore, Canada is ideally situated to supply growing demand in the United States. The market for hemp products in the United States alone was already estimated at just under $700 million USD back in 2016, displaying year on year growth of 20% since 2011.2 Estimates place the market for hemp-based products sales at just over $1.8 billion USD by 2020 in the United States alone. With a head start by having regulation already in place, and the ideal growing

2Statistics come from a Congressional Research Service report (CRS REPORT 7-5700 RL32725) published by Renée Johnson in 2018 titles: Hemp as an Agricultural Commodity.

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conditions for hemp including long daylight hours in the summer, Canada is ideally located to take advantage of growing U.S. market in the coming years.

3.1.2 Global To date, most of Canada’s hemp related exports have focused on hemp seed. However, with the new regulations in Canada’s Cannabis Act this is expected to change. In 2017, Canada exported 10,500 metric tons (MT) of hempseed valued at nearly $50 million USD. Seventy percent of Canada’s export volume went to the United States, followed by European Union (EU) member countries and South Korea.

The top markets for hemp fibre globally are Germany, the Czech Republic, Spain and Finland. In 2018, Germany imported 6,563 MT of hemp fibre, much of that coming from France. The Czech Republic and Spain imported 5,901 MT and 4,800 MT in 2018, respectively. The average total market for hemp fibre imports has been roughly 20,000 MT for the previous four years (Figure 5).3

Figure 5 : Global Hemp Imports

Source: Global Trade Atlas

Global imports of hemp fibre to date may downplay the potential available market for hemp fibre over the coming years, and in doing so undersell the opportunity for intermediate hemp processing in Alberta. For one, the United States has not yet been accounted for because the USDA is only now in the process of developing regulation for the hemp industry.

Once the United States begins processing hemp it is expected to increase the overall demand for hemp fibre. Secondly, Canada itself (including Alberta) is receiving considerable investment in the hemp processing industry. For instance, two hemp processing industries are looking to build or expand their operations producing non- woven matting and/or hempcrete building blocks, offering potential local demand

3 The data on hemp fibre is limited given its proprietary nature. For the purpose of “Hemp Imports” we have used HS code 5302: (True hemp (cannabis sativa L.), raw or processed but not spun; tow and waste of true hemp (including yarn waste and garnetted stock).

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for both fibre and hurd.4 A hemp processing plant could supply local secondary processing industries.

3.1.3 Processing The most developed markets for hemp fibre processing are in China and the European Union. China is a large hemp producer (Figure 4), accounting for 30% of global production, yet they have not historically imported very much hemp from abroad. The large processing markets for hemp fibre in the European Union are in the Netherlands, Germany, the Czech Republic and Spain. While China may not offer an immediate export market for Canadian hemp, European trade partners could be potential markets from the start.

Recent data from the European Industrial Hemp Association shows that 25,000 MT of bast fibre was produced in 2013. The bast fibre was then divided amongst the following industries: the pulp and paper market, insulation, the BioComposites market, and technical textiles. These are current and well-established markets that Canada could potentially access.

Figure 6: 2013 European Union Hemp Fibre Domestic Disposition (MT) 750 3,500 Pulp & Paper

Insulation

6,500 Biocomposites

14,250 Technical Textiles

Source: European Industrial Hemp Association

In the EU, hemp hurd has traditionally been used as animal bedding, garden mulch, and more recently in emerging sectors such as construction and for the cultivation of fungal crops and for generating heat (incineration). Hemp fibre typically generates a much higher rate of return for processors compared with hemp hurd, but this gap could close if more uses are discovered.

Figure 7: 2013 European Union Hemp Hurd Domestic Disposition (MT)

3,500 860 Animal bedding Garden mulch 8,170 Construction

Other (fungi cultivation, 27,090 incineration)

Source: European Industrial Hemp Association

M arketing In addition to the geographic distribution of markets, it is also important to Seg ments consider the specific market categories across geography. This is a of critical importance as the attributes required are likely more related to function than market location.

4JustBioFiber and BioComposites Group.

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The following outlines the key applications that are currently being considered. Given the significant changes occurring in regulations it is likely that additional markets will also surface. However, the assessment to follow has not considered this directly in the analysis and these opportunities need to be considered in the application of a discount rate.

3.2.1 Industrial Potential industrial applications for hemp include technical fibres for Applications advanced applications such as interior paneling for the automotive sector. In the coming years there could be increased demand from leading car manufacturers interested in incorporating materials into their production process that contribute to a more sustainable vehicle. As in almost every other industry, the automotive sector is trying to improve their image through marketing sustainability.

In recent years leading auto manufacturers in Europe have attempted to incorporate renewable hemp fibre into interior car paneling. However, the technology was not yet at the point where parts providers could maintain the consistency of quality at the required price demanded by the automotive sector to make it feasible on continuous basis, i.e. those auto companies experimenting with hemp fibre returned to polypropylene based technologies. This is not to say that the auto sector does not offer great potential in the coming years, it is that to date it should not be relied upon to support a hemp decortication plant.

A current market that is consistently incorporating hemp fibres is the pulp and paper industry. For example, one of the leading industrial hemp cooperatives in Europe, La Chanvrière, is made up of 800 producers cultivating 20,000 acres in a 140 km radius around a hemp decortication plant located at Bar-Sur-Aube, France. La Chanvrière primarily supplies hemp fibre for paper production in Europe. In the European Union, nearly 60% of hemp fibre is destined for the paper industry. New research is showing that paper produced from hemp has greater recycling potential than traditional wood-based paper. The other industries supplied by La Chanvrière are mattress production (mattress spring covers), the construction sector (mats) and some automotive.

Hemp fibres are also increasingly being used in non-woven and natural semi- fabricated products for pressing composite materials. These products include erosion mats for retaining purposes in the industrial sector. Additionally, the technical fibres can be combined with bio-based polymer into injection mould pellets, which can then be used in several injection mould processes to make anything from plastic cups to home furniture. The industrial applications for the byproducts from hemp processing (fibre, hurd, and dust) appear to be expanding as more companies find innovative applications

3.2.2 Construction Hemp by-products are being used to create insulation, plate material for external wall Applications insulation and roof construction, non-woven felt for sound absorption, and lime hemp and hemp blocks.

They are also being incorporated into building blocks (hempcrete), which is a mixture of hemp hurds and lime used as a new material for construction and insulation. This

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product is currently being marketed as less brittle than traditional concrete building blocks in addition to having favorable insulating and thermal mass qualities. There is currently a company in Airdrie (JustBioFiber), Alberta, producing hempcrete blocks and looking to expand production.

On a global scale, Germany, Spain and the United Kingdom were the largest importers of bio-fibre based building materials for the construction sector (Table 1). Imports of bio-fibre based building materials by these top importers reached nearly $150 million USD in 2016, signaling a growing interest in hemp-fibre based building materials.

Table 1: Bio-Fibre Based Building Materials Importers (2016) Country Imports (US$) Germany $19,918,248 Spain $18,446,647 United Kingdom $18,239,735 Republic of Korea $15,446,565 Switzerland $15,144,403 Denmark $14,886,703 Australia $13,059,744 USA $11,340,010 Russian Federation $11,183,505 France $9,412,371 Source: FAO Trade Data

Bio-fibre based building material exports were led by China ($121 million USD), Japan ($30 million) and Germany ($29 million) in 2016. This is a growing market and one that could provide great opportunity for a hemp decortication plant in northern Alberta.

3.2.3 Food Service Hemp seeds can be consumed or used to produce a variety of food products Sector including hemp milk, hemp oil, hemp cheese substitutes and hemp-based protein powders.

A Manitoba based company has been selling hulled hemp seeds for human consumption for over 15 years. They are well established in the North American market. Farmers in the prairies growing dual-purpose hemp (for seeds and fibre) could easily benefit from selling both the hemp seed and hemp straw. Hemp byproducts are being incorporated into everything from cereals to body lotions and roasted hemp coffee. The possibilities for incorporating hemp into food and lifestyle products appear to be endless at this point although the current demand is relatively small. It is important to recognize that entry into this market has significant regulatory hurdles – getting approval for food products/ingredients is generally relatively complex in most countries.

3.2.4 Livestock and According to Statistics Canada, global imports of dog and cat food were valued at Pet $12.4 billion USD in 2017. Tapping into the pet food market with new hemp products Applications has significant potential for this industry. Hemp-based therapeutic dog products in the form of a chewable are already being exported by a British Columbia company to

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the New Zealand market. In this way, hemp fibre and hurd are already being incorporated directly into pet food itself. Another Manitoba-based company is producing a list of ‘pet booster’ edible products for cats and dogs and selling them on the domestic market. The segment of the pet food sector that appears to have the most growth potential is CBD-based pet treats. This market is growing rapidly and is expected to do so over the coming years.

In addition to pet food, hemp fibre and hurd are being used for various forms of bedding for cats and other pets like rabbits and guinea pigs. Hemp straw and by- products are also being used as bedding in larger livestock production systems for cattle and other animals. A market with large potential for the hemp hurds is the equestrian market. Another British Columbia based company is currently supplying 15 kg compressed bags of hemp hurds (bedding) to the local equestrian hobby market. This sort of business opportunity could provide a value-added revenue stream for a hemp decortication plant in Alberta.

Su mmary The Canadian government has demonstrated their support for the hemp industry by providing investment towards transforming the sector, which coincides with projections of considerable growth in the global hemp industry over the next decade. This is an important signal to industry, as the current market for hemp fibre, hurd and dust is in the early stages of growth. Global demand for the primary commodity seems to be growing based on changing consumer trends. This is a must to make a decortication plant in Alberta viable.

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4.0 Operations

Ov ervi ew This section identifies the various components of the operations having a critical impact on the cost to produce: labour, utilities, capacity, freight, capital use, the impacts of location, overhead, and other operating costs.

Analysis is related to the estimated attainable market as outlined in the previous section as well as linked directly to the financial section to follow. It is also important to recognize that the assumptions made on operations are considered as part of the scenario analysis that has been conducted and that the sensitivity of financial results to these scenarios will be discussed in the following sections.

The regions assessed in the scenario analysis are grouped into their five Regional Economic Development Alliances (REDA’s) (Figure 8).

Figure 8: REDA Groups

Northeast Alberta Information HUB Ltd

Peace Region Economic Development Alliance (PREDA)

Growth Alberta Regional Economic Development Initiative (GROWTH Alberta)

Grande Alberta Economic Region (GAER)5

Regional Economic Development Initiative (REDI) for Northwest Alberta

Source: Modified version from Government of Alberta

Op erati ng The assessment considers operating and capital costs separately so that impacts of Co sts scale economies can be assessed. Key cost drivers are identified and qualified, and the ones with the most impact on net profitability have been used to drive sensitivity and scenario analysis. This enables a more robust assessment of the potential returns of a facility.

5 For our assessment we have also included the region of GAER. While this may no longer be a REDA entity, for the purpose of comparability we have used it in our model as a region.

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4.2.1 Cost of Goods The costliest input for a hemp decortication plant is hemp straw. Therefore, a Sold sufficient and reliable supply is critical for the viability of the plant. In order to be conservative, a yield of 3.6 MT/acre for hemp straw has been used in the benchmark analysis. This is consistent with current estimates in research from the Government of Alberta and the University of Alberta.6

Other current research provides data that indicated yields upwards of 6.7 MT/acre for Mackenzie County, but we have chosen to maintain 3.6 MT/acre in our model because it is a more widely accepted yield variable for hemp at this time. Increased yields greatly reduce the required land and distance hemp straw must be hauled to a decortication plant (Table 2). Given the experience with improvements in yield in the canola industry, it is likely that as investment and acreage increases in the hemp sector yield increases will also follow.

Perhaps even more important is the impact that yield increases might have on price. As the cost per unit of production drops, it is very likely that at least some of this will be passed on to buyers via typical supply/demand relationships.

Table 2: Required land relative to hemp straw yield Size of Plant Required Straw Yield Required land 10 MT/hr 36,500 MT 2.0 MT/acre 73,000 acres 10 MT/hr 36,500 MT 3.6 MT/acre 40,555 acres 10 MT/hr 36,500 MT 6.7 MT/acre 21,791 acres Note: Required farmland assumes that producers are growing hemp on a four-year rotation with other crops.

Farmers that are storing hemp straw on site rather than the hemp decortication facility storing it at their location are incurring an opportunity cost. In inventory management theory, the general “rule of thumb” for inventory carrying cost is 18-25% of the inventory value on hand.7,8 Research out of Kansas State University suggests that the annual cost to farmers per MT of hay stored on site is 14% of the value of inventory. This cost needs to be accounted for in the model, especially considering we are modelling a relatively small lot size for the hemp decortication facility, i.e. limited storage on site. We include the assumption that farmers are compensated to store hemp straw on farm rather than sell it to another prospective buyer. In our model we assume the hemp decortication facility and farmers in the surrounding region form a contract so that the facility has a secure supply of hemp straw throughout the year.

6 Alberta Agriculture and Forestry put the yields at between 2.4 and 4.8 MT/acre for the province of Alberta, with an average of 3.6 MT/acre. Recent industrial hemp experiments conducted by Dr. Miles Dyck and Dick Puurveen in 2017 (University of Alberta) in the Brazeau County region show similar average results. Some other recent work conducted by the Mackenzie Applied Research Association (MARA) in 2017 at their Fort Vermillion research facility shows average yields at 6.7 MT/acre for this region, compared with their findings of 4.8 MT/acre for Southern Alberta. They attribute the higher yields to the northern location and longer days. However, other more current information (2019) from an industrial hemp workshop, presented by Dr. Jan J. Slaski puts average yields at 2 MT/acre for Southern Alberta. Therefore, we have chosen to stick with a value of 3.6 MT/acre for our model given that it comes from a provincial level source and is a more widely accepted yield rate at this time. 7 Richardson (1995) suggests that the total inventory costs can be estimated at between 25%-55% on an annual basis (Richardson, H. (1995). Transportation & Distribution; December 1995, Vol. 36 Issue 12, p94). 8 The authors Stock and Douglas (1987) are often referenced as using 25% as the general rule of thumb for inventory carrying costs (Strategic Logistics Management, 2nd edition, 1987, James R. Stock and Douglas M. Lambert, Irwin, Homewood, Illinois).

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As a rough estimation, we add 14% to the cost of hemp straw to account for inventory carrying cost to farmers. Therefore, the price of hemp straw is $100/MT9 plus an addition $14 for inventory carrying cost. Straw prices for the hemp decortication facility are $114/MT.

4.2.2 Labour With the contraction of the oil and gas sector in Northern Alberta many skilled workers have been left searching for new opportunities. This provides a significant advantage as the oil and gas sectors have invested in training employees, especially in the northern half of the province, and this could provide a unique opportunity to tap into that skilled workforce. The share of the workforce with a diploma, certificate or degree as highest level of education is over 90 percent (2017), suggesting that access to highly skilled labour will not be an issue.

Labour costs for a 10 MT/hr hemp decortication plant account for 5 percent of net expenses on an annual basis by year 5. Due to economies of scale, labour’s share of net expenses reduces as the size of the facility increases, i.e. hemp straw, interest, property tax and depreciation all grow relative in share of total expenses relative to labour requirements as the plant increases in MT/hr capacity.

For the assessment, our models of the three facility sizes requires between 10 and 16 employees. Specifications for labour requirements were developed through consultation with leading hemp decortication equipment manufacturers (Table 3).

Table 3: Labour Requirements Plant Size Managers Supervisors Production Technicians Administrative 4 MT/hr 1 2 4 2 1 8 MT/hr 1 2 8 2 1 10 MT/hr 1 2 10 2 1

The chosen labour schedule for the decortication plant is the same regardless of the plant size. It will operate five days per week with two 7.5-hour shifts per day (i.e. the plant operates 15-hours per day). The total hours worked by the production staff in a year is 1,825, which means that in the year the decortication machines will run 3,650 hours. We have modelled just under 49 weeks on the job for decortication line workers to account for vacations, sick leave and other time away from work. This is industry standard.

In a 10 MT/hr plant as an example, there will always be one supervisor and eight production staff on site operating the decortication equipment as well as one technician troubleshooting repair issues. At the same time, a manager and an administrative employee will work a 7.5-hour shift during ‘regular’ business hours. The manager will supervise the ongoing business-related aspects of the decortication facility as well as being on call to handle any issues beyond the scope of the shift supervisors. The administrative employee will be on site to handle the regular administrative aspects of running a facility of this nature.

9 Our hemp straw price estimate (without the addition of inventory carrying costs) comes from our conversations Chris Dzisiak (Parkland Industrial Hemp), Stephen Christensen (Canadian Greenfield Technologies Corp) and Dan Madlung (BioComposites Group). These sources all suggested a price of $100/MT is reasonable.

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In general, the locations immediately surrounding Edmonton have the advantage regarding population – and thus a reliable source of workers. The locations of Vegreville, Lac Ste. Anne County, Lamont County, Minburn County, Bruderheim, and Barrhead County all have populations within 100 km exceeding 1 million because of their proximity to Edmonton. After these locations, most of the locations with greater than 40,000 population are in Alberta HUB (between Edmonton and the Saskatchewan border). Towns such as Vermillion and Elk Point boast populations of roughly 60,000, when counting the surrounding region. However, all the site locations in the study have population sizes adequate for putting in place a hemp decortication facility. What some regions may lack in population they make up in hemp production potential (i.e. acreage of land in crop), which is a much larger factor when it comes to sourcing and transporting hemp straw.

Table 4 provides a list of the various site proposal locations as well as their populations within a 100 km radius. This information comes from a previous transportation study conducted as a part of the HANA assessment.

Table 4: Population within 100 km Population Population (2018) Site locations (2018) within 100km Barrhead County 4,720 71,294 Big Lakes County 5,772 103,352 Bonnyville MD 6,082 59,865 Bruderheim 1,330 >1,000,000 Cold Lake Indian Reserve 15,205 43,065 Drayton Valley 7,500 123,720 Elk Point 1,474 56,003 Falher 994 21,592 High Level 3,297 20,260 Lac La Biche County 8,452 151,571 Lac Ste. Anne County 10,953 >1,000,000 Lamont County 3,909 >1,000,000 Minburn County 3,244 216,103 Northern Lights County 10,785 55,930 Smoky Lake County 4,503 >1,000,000 Smoky River MD 2,072 71,235 St. Paul County 6,105 134,231 Thorhild County 3,239 >1,000,000 Town of Two Hills 1,377 55,142 Two Hills County 3,187 55,142 Vegreville 5,873 157,843 Vermillion River Country 8,485 59,157 Vermillion 4,154 59,157 Woodlands County 4,786 149,180 Source: Government of Alberta10

10 Population data (2018) comes from the Government of Alberta (link). To gather the population data within the surrounding 100 km area, each region was selected and then the option “By Municipality” was selected and the “Distance From” was set to 50 km away. The example of the population data for Vermillion can be seen here. The column on the right shows the potential labour force that would be able to commute from within 50 km, or a total of 100 km in diameter.

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4.2.3 Utilities Alberta has roughly a $0.02/kWh electricity price advantage for large industrial consumers when compared with Saskatchewan, the other leading province for registered acreage of industrial hemp. As Canada’s leading producer of natural gas, favorable rates can also be expected for heating industrial buildings. Access to telephone infrastructure is also widespread, however, high speed internet connectivity varies by site location. Many of the county site proposal locations are in the process of ‘bringing in’ high speed internet from the local town, but this needs to be assessed on a case-by-case bases. However, satellite high speed internet is becoming more accessible province-wide through organizations - Xplornet as an example.

A hemp decortication facility will require a 575 volt (60 Hz) 3-phase power supply. Electrical costs incorporated into the model have been held constant for all 24 locations at $0.10/kWh. The Alberta Utilities Commission11 provides the most up-to- date rate options, showing that residential regulated rates vary between $0.68/kWh ($0.8294/kWh actual) to $0.68/kWh ($0.9424/kWh actual). While industrial rates will vary from residential rates, this information is proprietary and not made available by energy providers. Natural Resources Canada (NRC) provides an overview of industrial electricity prices across Canada ($0.078/kWh in Edmonton for industrial), however, they do not include line fees and other charges in this price. Therefore, we have used $0.10/kWh in the model because it provides a realistic indication of the actual electricity costs in the REDA regions (when additional fees are included).

A hemp decortication facility will consume roughly 190 kW/hr (140 kW/hr without factoring in compressed air) per MT/hr of output (Table 5). At an electrical rate of $0.10/kWh, a 10 MT/hr plant would cost roughly $730,000 a year to operate. Reducing the cost of electricity to $0.07/kWh reduces the cost of electricity on the same sized plant to $485,000. Increasing the price of electricity to $0.15/kWh, to account for higher prices resulting from carbon mitigation policy as an example, would increase the cost of operating a 10 MT/hr plant to $1,000,000. Negotiating favorable electrical rates with regional provider is, therefore, important to keeping down the cost of operating a decortication facility.

Table 5: Electricity Requirements by Plant Size Machine Size Electricity Consumption 4 MT/hr 760 kW/hr 8 MT/hr 1520 kW/hr 10 MT/hr 1900 kW/hr Source: Industry consultations

4.2.4 Freight Transportation costs have been factored into the model depending on the scenario, but in general they break down into three categories:

• Transport to the site for processing (from the farm) • Transport to Drayton Valley (fibre) • Transport to Edmonton (fibre, hurd and dust)

11 http://www.auc.ab.ca/Pages/current-rates-electric.aspx

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All sourcing of hemp straw and transportation into the site location have been modelled using tractor semi-trailers (truck)12, whereas shipping processed fibre, hurd and dust to Edmonton and Drayton Valley have been modelled with both: (1) truck, and (2) truck and rail.

As with capacity considerations when building a decortication plant, one must not only consider whether the farmland in the region is capable of supplying the quantity of hemp straw necessary to keep a plant running (arable land) at full capacity, but also how far the straw will need to be hauled. If either competition for scarce hemp straw increases, or farmers shift to other crops in the region, transportation costs to bring in straw could impact the viability of the facility. For an 10 MT/hr plant sourcing hemp straw from within a 50 km radius would cost the facility $270,000 in transportation costs annually (Figure 9). Increasing the required transport distance to 125 km increases the transportation costs to $675,000 for the same sized facility.

Figure 9: Cost to Haul Straw to a 10 MT/hr Plant

Taking the average distance of the site locations in each region provides the following visual of the difference in transport costs to move fibre, hurd and dust to Edmonton via truck and rail transport for 10 MT/hr plant (Figure 10). As can be expected, the two northern most regions of the province are at a disadvantage relative to the regions closer to Edmonton, particularly when it comes to transport via truck. However, if access to rail can be secured regions such as Falher become just as competitive as some regions closer to Edmonton given their productive acreage advantage and low tax rates.

Figure 10: Transport Costs by Location to Edmonton

12 In reality the decortication plant will pay a Free On Board (FOB) price for hemp straw delivered at site, but for the sake of comparing site locations it makes more sense to set the price of straw ($90/MT) in the model and have the different locations pay the transport cost to bring it from the surrounding regions to their processing site.

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4.2.5 Overhead & Overhead costs refer to the ongoing expense of operating the decortication facility. Other Unlike other operating expenses such as raw material and labor, overheads are not Operating linked with any cost unit. Costs As this is an intermediate processing facility and not one producing finished goods, the marketing budget has been kept on the conservative side at $10,000 per year. Accounting and bookkeeping services have been budgeted at $500 per month or $6,000 per year. The meals and entertainment budgeted in the model are $2500. The meetings, convention and travel budget for this facility is $3000. The annual office, computer, and telephone budget for the facility is $3000. For some years (e.g. initial setup) the budget will likely be higher, but for subsequent years it will likely be lower, so an annual budget of $3000 should cover office, computer and telephone costs.

Property tax for this model is calculated by multiplying a mill rate by the assessed industrial property value (land, buildings, and equipment). The mill rate is the amount of tax payable per dollar of the assessed value of a property. When tax data was available in the individual site proposals it was incorporated into the model. The remainder of the tax information was collected from the Government of Alberta (Table 6). The site locations with the most favorable tax rates are Woodlands County, Cold Lake First Nations, Vermillion, and Vermillion River County.

Table 6: Municipal Non-Residential Mill Rates and Total Tax Burden Mill Rate Education Other Total GROWTH ALBERTA Barrhead County 17.30% 3.6900% 0.1913% 21.1813% Lac Ste. Anne County 22.63% 3.3060% 0.2910% 26.2280% Woodlands County 10.37% 4.1551% 0.2239% 14.7514% Northeast Alberta Information HUB Ltd (Alberta HUB) Bruderheim 18.64% 3.6325% 0.4985% 22.7681% Cold Lake First Nations 12.32% 3.7879% 0.1679% 16.2750% Vegreville 20.57% 3.5004% 0.1401% 24.2105% Vermillion River Country 13.86% 0.0000% 0.0000% 13.8640% Vermillion 11.04% 3.8952% 0.0786% 15.0088%

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Lamont County 19.56% 3.5587% 0.6531% 23.7704% Minburn County 22.00% 3.5004% 0.1401% 25.6431% St. Paul County 18.86% 3.9426% 0.2610% 23.0610% Thorhild County 22.72% 3.5406% 0.6027% 26.8619% Elk Point 15.92% 3.8320% 3.1830% 22.9330% Bonnyville MD 15.03% 4.8197% 0.0839% 19.9377% Lac La Biche County 18.40% 3.6737% 0.2753% 22.3478% Smoky Lake County 20.28% 4.0900% 1.2356% 25.6056% Town of Two Hills 22.98% 3.3450% 0.5640% 26.8900% Two Hills County 21.87% 4.0811% 0.6663% 26.6183% Peace Region Economic Development Alliance (PREDA) Northern Lights County 14.04% 4.5775% 0.0341% 18.6551% Falher 15.68% 3.9500% 0.1510% 19.7782% Smoky River MD 20.04% 3.5600% 0.1712% 23.7704% Big Lakes County 14.53% 3.7950% 0.1495% 18.4786% Regional Economic Development Initiative (REDI) for Northwest Alberta High Level 14.93% 3.6400% 0.1960% 18.7607% Grande Alberta Economic Region (GAER) Drayton Valley 14.44% 4.0831% 0.2543% 18.7800% Source: Site proposals and Government of Alberta

Property taxes are a significant fixed cost to consider when setting up a hemp decortication facility. For our assessment, we averaged the combined non-residential tax rate, education tax and all other additional tax burden for the respective municipality, county or town (e.g. senior taxes) into one rate and then averaged that rate for the entire region, i.e. each of the REDA groups has an average tax burden for that region. However, for the financial projections in the following section we altered the model to include the specific information for each region.

The average tax burden ranges from 18.79 percent to 24.17 percent across all regions. Taking the example of GROWTH Alberta, the tax burden ranges from 14.75 percent to 26.23 percent, meaning that there is considerable disparity within the average of 20.71 percent. Adjusting the average tax rate for GROWTH Alberta from 20.71 percent down to 14.75 percent (the lowest tax burden for that region) drops property tax’s share of overall net expenses significantly.

Cap ital There are significant capital costs associated with all three facility size categories. This Co sts is a critical consideration as these costs are essentially sunk once assigned and virtually impossible to recover. As a result, a significant amount of due diligence was conducted on this cost category the relevant cost drivers.

4.3.1 Capacity A hemp decortication plant requires considerable feedstock (i.e. hemp straw) from Considerations the surrounding region. This means that productive acreage within a 150 km radius is important for reducing transportation costs to source hemp straw. Under the assumption that hemp is going to be grown on a four-year rotation, ideally, the chosen site location for the hemp decortication facility would have four times the acreage in the surrounding region than is required to supply the facility. The values displayed in Table 7 are modelled at a hemp straw yield rate of 3.6 MT/acre.

Table 7: Capacity Input Requirements Plant Size MT/hemp required Acres of hemp Acres of farmland

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4 MT/hr 14,600 4,050 acres 16,220 acres 8 MT/hr 29,200 8,190 acres 32,780 acres 10 MT/hr 36,500 10,140 acres 40,555 acres

While the REDA site locations have varying levels of productive acreage northern Alberta does appear to be ideally suited to hemp production based on available potential supply of suitable land.

Stem elongation of the hemp plant occurs before flowering, meaning that northern latitudes such as the regions in this assessment, have an advantage in hemp production. With upwards of 17 hours of daylight during the growing season, hemp plants in Alberta can grow up to 15-20cm per day and reach up to 4m in height, which makes it one of the fastest growing regions in North America.

The REDA site locations with the most production acres are Bruderheim, Falher, Smoky River, Vegreville, Minburn County and Vermillion. These regions boast over 600,000 productive acres within the surrounding region. Only three of the site locations have fewer acres than are required to put in place the largest decortication facility in this assessment, which demonstrates the productive capacity of northern Alberta.

However, it is important to keep in mind that our model does not account for competition for hemp straw or fluctuating prices going forward. For example, if demand for hemp straw exceeds supply and prices increase it will affect the revenue generation of the plant. In the model the price of hemp straw has been set at $90/MT, however if through competition it were to grow to $120/MT it would reduce cash flow and increase the payback period.

To house all the decortication machinery as well provide room for the other necessary equipment (air compressor system) and space to maneuver forklifts and other industrial equipment, the facility needs to be approximately 4,300 square feet for every 1 MT/hr capacity of decortication equipment. In addition, the site location requires storage capacity to house all the processed fibre, hurd and dust. For this purpose we have factored an addition 1,075 square feet for every MT/hr capacity of decortication equipment to allow for storage capacity (Table 8). 13

Table 8: Building Requirements by Machine Size Machine Size Decortication Building Storage Capacity Total 4 MT/hr 17,200 ft2 4,300 ft2 21,500 ft2 8 MT/hr 34,400 ft2 8,600 ft2 43,000 ft2 10 MT/hr 43,000 ft2 10,750 ft2 53,750 ft2 Source: Industry consultations

4.3.2 Building Costs Land costs are incorporated into the model separately using information provided in the site proposals in addition to primary research. The average land cost estimates are provided in the following section titled Land and Land Preparation.

13 The land and building requirement estimates are based off an MNP LLP study titled Clean Energy Technology Centre

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The startup costs for the building and equipment have been grouped together into one overall cost (Table 9). Steel building construction costs are estimated at $40/ft2. We have added an additional 15% contingency to the overall cost of the steel building, decortication equipment and industrial land to account for unexpected costs.14

Table 9: Building and Equipment Costs Machine Size Total 4 MT/hr $ 9,534,478 8 MT/hr $ 19,068,955 10 MT/hr $ 23,836,194 Source: Consultation with industry experts.

The breakdown for equipment costs can be separated into various subcomponents that include all of the associated costs with bringing a decortication facility up and running (Table 10). The following table displays the cost breakdown for a 4 MT/hr facility.

Table 10: Breakdown of Install Cost: 4 MT/hr Decortication Plant Description $ CAD Feeding and decortication $1,821,330 Cleaning and refining $1,362,690 Technical fibre baling $257,250 Core cleaning $588,000 Filtration (+ transport of dust to once central point) $543,900 Electrical system $1,134,840 Short fibre baling $105,840 Budget for decortication equipment: $5,813,850

Estimation of cost of ductwork $294,000 Estimation of cost for cables and cable trays $294,000 Estimation of cost for transportation to Alberta (from Belgium) $404,250 Estimation of cost for supervising the installation $382,200 Estimation of cost for starting up, testing, training & commissioning $242,550 Budget for additional equipment: $1,617,000 Total: $7,430,850 Source: Estimates based on Cretes Manufacturing quote. Estimates were provided in Euros and converted to Canadian dollars using a conversion rate of 1.47 for this work.

In addition, there are assumed to be some capital expenditures required for the administration of the business (Table 11). These are initial capital expenditures, but they all require a budget for upkeep following the first year.

Hemp Cluster Feasibility Study published in October 2018. Their estimates are based on interviews with Byron James and Dan Madlung; HempTrain equipment dimensions, Powerzone equipment dimensions. We cross checked these estimates with a recent quote from Crete's (Creative Technical Solutions) dated 15/8/2019 from Stefaan Declerck. 14 We have selected 15% based on a study Canada's Chief Review Services. The review found that contingency on large projects typically ranged from 10-15%, with some as high as 20%.

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Table 11: List of Other Equipment Purchases Furniture (desks and chairs) $15,000 Computers $10,000 Telephones $2,000

4.3.3 Land and Land Consultation with industry representatives suggest that facilities of the sizes modelled Preparation require between 5 to 13 acres. More specifically, for the model we have estimated that a 4 MT/hr requires approximately 5 acres, an 8 MT/hr requires 10 acres, and a 10 MT/hr requires 13 acres.15

A piece of flat land with good ground-bearing capacity would be ideal because the outdoor space would be used for parking trucks and storing hemp fibre. The assumption has been made that less land is required because the majority of the straw will be kept on-farm. Straw is delivered as needed, as is the case for other leading operations such as La Chanvrière Cooperative in France. If the facility adopts a model that requires more on-site storage capacity (less frequent straw delivery), the required land will increase from what we have proposed in our model.

Site preparation includes site clearing and grading (if necessary), excavation and trenching for the building’s concrete pad, water mains, sanitary sewer systems, storm sewer and retention systems, underground (if necessary) electrical and telecommunication systems, road and access parking, and pathways and sidewalks. All the site preparation costs have been factored into the initial capital expenditure and outlined in the Financial Assessment section of this document.

Land prices vary by REDA site location, as well as various other factors including whether the plot of land has: frontage on a main road, municipal water services, rail access, and various other considerations. Therefore, specific site locations will need to be priced on a case-by-case basis. However, for the purpose of our assessment we were able to estimate industrial land values based on the regional averages (Table 12).

Table 12: Industrial Land Prices16 Regions Price per acre GROWTH ALBERTA $ 105,000 Alberta HUB $ 145,000 PREDA $ 105,000 REDI $ 100,000 GAER $ 175,000 Source: Based on site proposals and consultations

15 The land requirement estimates have been altered (reduced) from earlier iterations of the economic model based on more recent consultation with industry. Review of other economic studies and consultation with industry suggest that less land is required for a facility because the straw will be stored mostly on farm, rather than at the site location. As a result of this adjustment to the model, we have also increased the price of hemp straw to account for farmers having to store the straw. 16 Investors should contact site locations directly for updated industrial land value prices. The prices provided in the table above are averages across the region.

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4.3.4 Summary Estimated capital expenditure requirements for a 4 MT/hr, 8 MT/hr and 10 MT/hr hemp decortication facility are approximately $10 to $25 million dollars (CAD) including the land, site preparation, building and equipment (piping, electrical, compressed air, decortication machines, etc.).17

A salvage value of 25 percent of the original value of the capital expenditure is assumed and applied at the end of the 20-year useful life of the facility. This is applied in every financial scenario modelled.

17 Total capital expenditure costs have been adjusted from earlier iterations based on more recent quotes from equipment suppliers. Earlier cost estimates were based on a more complex facility design.

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5.0 Financial Assessment

Ov ervi ew In this section we will present an overview of the financials for operating a hemp decortication facility in Alberta. We have listed and provided context on each of the key assumptions made and provided sensitivity analysis on the impacts of each one.

Each of the critical assumptions made in the marketing and operating sections are assessed as part of the analysis. Different scenarios are used to ensure that the model and results are robust. Any critical success factors are discussed in detail in terms of how they might impact financial feasibility.

The costs associated with setting up of the hemp decortication plant would include purchasing the land, building a steel structure between 21,500 ft2 and 53,750 ft2, purchasing and installing decortication machinery with an output between 4 MT/hr and 10 MT/hr, and all the other associated costs.

At this point the startup value is simply an estimate and would need to be re-priced based on detailed equipment quotes, and detailed engineering plans for the building. This detailed pricing can be completed once the business plan and rough plant layout have been decided upon.

Assu mp tion s

5.2.1 Variable & The following tables outline the main cost elements associated with plant operations. Fixed Costs These are further broken into fixed and variable costs. It is important to note that this information is reflective of what a reasonable person would be expected to pay for the specific cost element.

Table 13: Fixed Costs Salaries Manager $105,000 Supervisors $82,500 Production Staff $50,000 Technician/Millwright $82,500 Administration $48,000 EI/CPP/Benefits 15%

Insurance $90,000/year Professional fees (accounting and legal) $25,000/year Fixed Utilities $2,500/year Finance and banking charges $1,500/year Long term loan interest rate 4% Phone, fax, internet, web page $6,000/year Web page (design and maintenance) Year 1 $20,000 Ongoing $5,000/year Marketing $50,000/year Meals and Travel $50,000/year

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Hemp License $1000/year Recruiting (Advertising for other staff) Year 1 $10,000 Ongoing $2,000/year Software purchases Year 1 $3,000 Ongoing $1,000/year Photocopier Lease $4,800/year Office Supplies $2,750/year Vehicle lease $8,500/year Fuel and oil $10,000/year

Table 14: Variable Operating Costs Labour – Hemp Decortication Plant 4 MT/hr 8 MT/hr 10 MT/hr Hemp Decortication Line $15 2 people/hour 4 people/hr 5 people/hr Supervisor $25 1 person/hour 1 person/hr 1 person/hr Hours per shift 7.5 7.5 7.5

Table 15: Variable Costs Price 4 MT/hr 8 MT/hr 10 MT/hr Hemp Straw $90/MT 15,600 MT/yr 31,200 MT/yr 39,000 MT/yr Trucking $4/km Rail $0.84/km Electricity18 $0.10/kWh 760 kW per hr 1,520 kW per hr 1,900 kW per hr

5.2.2 Plant Plant size has an important impact on financial feasibility. The following tables clearly Productivity illustrate the production differences by plant size. In Year 1 the decortication plant by Size does not produce any output, but in the following years it increases in efficiency until Category it maxes out at 95% from Year 5 onwards. Table 16 shows the output of fibre, hurd and dust for a 4 MT/hr, an 8 MT/hr and a 10 MT/hr from Year 2 to Year 5.

Table 16: Fibre, Hurd and Dust Production by Plant Size and Efficiency 4 MT/hr Output Year 2 Year 3 Year 4 Year 5 77% 84% 91% 95% fibre 2,811 3,066 3,322 3,468 hurd 6,183 6,745 7,307 7,629 dust 2,248 2,453 2,657 2,774 8 MT/hr fibre 5,621 6,132 6,643 6,935 hurd 12,366 13,490 14,615 15,257 dust 4,497 4,906 5,314 5,548 10 MT/hr fibre 7,026 7,665 8,304 8,669 hurd 15,458 16,863 18,268 19,071

18 The Alberta Utilities Commission (AUC) provides details on regulated rate options by retailer. However, pricing is dependent on the exact land location, expected draw, and requirements for upgrading lines and transformers. The additional inclusion of line charges is also an undefined variable in the regulated prices provided by AUC. Therefore, in the model we have used $0.10 kWh as the price in all regions.

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dust 5,621 6,132 6,643 6,935

5.2.3 Price For our model we have used a value of $1,300/MT for hemp fibre (Table 17). The price Benchmarks of hemp fibre has been determined through consultation with industry.19 The other two by-products being modelled for this business plan are hemp hurd and hemp dust, which are priced at roughly $300/MT and $150/MT, respectively.

The following table outlines the benchmark prices, which are then adjusted as part of the sensitivity analysis.

Table 17: Pricing Schedule Commodity Price Fibre $1,300/MT Hurd $300/MT Dust $150/MT

Critical Cost While all assumptions are critical to the evaluation of the model, there is more weight Assumptions given to variables that have the most significant impact on the profitability of the business. The critical assumptions are described below. I mp ac tin g Mo del For the following critical cost assumptions, we have controlled by maintaining a 10 MT/hr hemp decortication plant, located in Barrhead, shipping fibre, hurd and dust to Edmonton by truck.

• Hemp straw costs on a 10 MT/hr hemp decortication plant are $4.2 million per year, modelled using a price of $114/MT. Cash flow in the model is affected when the price per ton of straw goes up, or if the distance required to haul fibre to markets increases.

• The cost of property tax for a $25.4 million 10 MT/hr hemp decortication plant are $570,000 per year (Barrhead), 14% of operating costs. Reducing the tax burden increases the capitalization rate of the plant.

• Interest on commercial loans, modelled at conventional 5-year mortgage rates to cover 50% of initial capital investment ($12.7 million) are roughly $600,000 per year, or 15% of operating costs.

• The difference in price per MT to transport fibre, hurd and dust to Edmonton via rail compared with truck is less than half per MT. This becomes more important the further one gets from Edmonton, especially for the site locations in the Peace River or even beyond.

• At a $0.10/kWh electrical rate the annual cost on a 10 MT/hr plant is close to $700,000. If policy changes in Alberta, such as taxes on electricity

19 Consultation with representatives from BioComposites group provided price estimates for hemp fibre in Europe and various locations in Western Canada.

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produced with fossil fuels (Carbon Taxes), significantly increase the cost of electricity it may alter the viability of a plant. Increasing the price of electricity to $0.15/kWh increases the annual cost to the plant to $1,000,000. In this way, reducing the price to $0.60/kWh reduces the annual cost to $420,000.

Breakev en A breakeven analysis has been completed for the following four generalized 20 An alysis locations :

• Northeast Alberta Information HUB Ltd (Alberta HUB) • Growth Alberta Regional Economic Development Initiative (GROWTH AB) • Grande Alberta Economic Region (GAER) • Peace Region Economic Development Alliance (PREDA)

For the breakeven analysis, the locations were modelled with a 10 MT/hr decortication plant transporting fibre, hurd and dust to Edmonton by truck. The assumption was also made that the plants receive 50% invested capital. The inputs for each location are given below.

5.4.1 Alberta HUB Total Tax Rate: 24% (Mill Rate=19.6% + Education tax + Other) Transportation Distance to Edmonton: 162 Industrial Land Cost per Acre: $145,000 Average Distance to Source Raw Material: 75 km

• Under the base scenario the repayment period is four years and the capitalization rate is 32.4%. • If the price of hemp straw were to increase to $150/MT, the repayment on investment remains in Year 4 but the capitalization rate would drop to 29.7%. • If fibre prices drop from $1,300/MT to $800/MT, the repayment on investment is pushed to Year 5 and the capitalization rate drops to 21.6% (all else equal).

5.4.2 GROWTH Total Tax Rate: 21% (Mill Rate=16.8% + Education tax + Other) Alberta Transportation Distance to Edmonton: 134 km Industrial Land Cost per Acre: $105,000 Average Distance to Source Raw Material: 75 km

• Under the base scenario the repayment period is three years and the capitalization rate is 33.5%. • If the price of hemp straw were to increase to $150/MT, the repayment on investment is pushed out to Year 4 and the capitalization rate drops to 30.8%. • If fibre prices drop from $1,300/MT to $800/MT, the repayment on investment is pushed to Year 5 and the capitalization rate drops to 22.8% (all else equal).

5.4.3 GAER Total Tax Rate: 19% (Mill Rate=14.44% + Education tax + Other) Transportation Distance to Edmonton: 145 km (no rail access)

20 Those seeking the mill rates, transportation distances and industrial land prices for specific regions should contact the municipal or town authorities directly. The above rates are averages across the regions.

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Industrial Land Cost per Acre: $175,000 Average Distance to Source Raw Material: 75 km

• Under the base scenario the repayment period is four years and the capitalization rate is 32.6%. • If the price of hemp straw were to increase to $150/MT, the repayment on investment remains in Year 4 but the capitalization rate drops to 30%. • If fibre prices drop from $1,100/MT to $800/MT, the repayment on investment is pushed to Year 5 and the capitalization rate drops to 22% (all else equal).

5.4.4 PREDA Total Tax Rate: 20% (Mill Rate=16.07% + Education tax + Other) Transportation Distance to Edmonton: 478 km (rail access) Industrial Land Cost per Acre: $105,000 Average Distance to Source Raw Material: 50 km

• Under the base scenario the repayment period is four years and the capitalization rate is 29.8%. • If the price of hemp straw were to increase to $150/MT, the repayment on investment would remain at Year 4 but the capitalization rate would drop to 26.7%. • If fibre prices drop from $1,100/MT to $800/MT, the repayment on investment pushes out to Year 6 and the capitalization rate drops to 17.6% (all else equal).

5.4.5 Summary The critical conclusion from the breakeven analysis is that the impact of the cost of transportation, the price of hemp straw and the price received for hemp fibre are all crucial for decortication plant. When shipping fibre, hurd and dust to Edmonton, the closer locations have an advantage in lower transportation costs.

However, when switching to rail transportation, the northern regions may actually come out ahead – this impact may be further affected by higher yields and thus potentially lower pricing. It is important to note that to this point in time the other two regions have displayed more resilience to fluctuating hemp straw prices and lower prices of hemp fibre on the world market. It would be critical to understand if this would continue given the major change in the marketplace that is likely to occur.

F inan cial A complete financial assessment was completed for a single location in order to test P roj ec tio n s the sensitivity of the key cost elements. All costs were held constant other than those specifically identified in the various options.

Barrhead was selected as the sample location. Four different financial projections (Projection 1, 2, 3 and 4) were built to demonstrate relative earning potential of a 10 MT/hr decortication plant shipping fibre, hurd and dust to Edmonton:

Projection 1: shows the financial projection resulting from the commercial loan to private equity ratio being 50/50.

Projection 2: shows how the financial projections change when the commercial loan to private equity ratio changes to 30/70.

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Projection 3: shows how the projections change given a 50/50 capital split when the price offered for hemp fibre increases to $1,500/MT, all else equal.

Projection 4: shows how the projections change given a 50/50 capital split when the price offered for hemp fibre drops to $800/MT, all else equal.

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Projection 1 1 2 3 4 5 Starting Cash -$ 2,653,205 $ 4,196,999 $ 12,185,853 $ 21,347,300 Gross Sales $ - $ 14,833,819 $ 16,425,083 $ 18,060,748 $ 19,137,446 Cost of Goods Sold $ - $ 3,252,030 $ 3,600,884 $ 3,959,472 $ 4,195,517 Gross Income $ - $ 11,581,789 $ 12,824,200 $ 14,101,276 $ 14,941,929

Operating Costs $ 1,644,936 $ 3,813,039 $ 3,916,798 $ 4,021,283 $ 4,092,429 EBITDA -$ 1,644,936 $ 7,768,751 $ 8,907,402 $ 10,079,993 $ 10,849,500

Bank Loan Pmt -$ 918,547 -$ 918,547 -$ 918,547 -$ 918,547 -$ 918,547 Annual Cash Flow -$ 2,563,483 $ 6,850,204 $ 7,988,855 $ 9,161,446 $ 9,930,953 LOC -$ 89,722 $ - $ - $ - $ - Accumulated Discretionary Cash Flow -$ 2,653,205 $ 4,196,999 $ 12,185,853 $ 21,347,300 $ 31,278,252

Capitalization Rate 32.7%

Invested Capital: $ 12,702,972

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Projection 2 1 2 3 4 5 Starting Cash -$ 1,999,983 $ 5,475,971 $ 14,084,914 $ 23,860,493 Gross Sales $ - $ 14,833,819 $ 16,425,083 $ 18,060,748 $ 19,137,446 Cost of Goods Sold $ - $ 3,252,030 $ 3,600,884 $ 3,959,472 $ 4,195,517 Gross Income $ - $ 11,581,789 $ 12,824,200 $ 14,101,276 $ 14,941,929

Operating Costs $ 1,381,223 $ 3,554,707 $ 3,664,128 $ 3,774,569 $ 3,851,980 EBITDA -$ 1,381,223 $ 8,027,082 $ 9,160,071 $ 10,326,707 $ 11,089,949

Bank Loan Pmt -$ 551,128 -$ 551,128 -$ 551,128 -$ 551,128 -$ 551,128 Annual Cash Flow -$ 1,932,351 $ 7,475,954 $ 8,608,943 $ 9,775,579 $ 10,538,821 LOC -$ 67,632 $ - $ - $ - $ - Accumulated Discretionary Cash Flow -$ 1,999,983 $ 5,475,971 $ 14,084,914 $ 23,860,493 $ 34,399,315

Capitalization Rate 29.6%

Invested Capital: $ 17,784,161

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Projection 3 1 2 3 4 5 Starting Cash -$ 2,653,205 $ 5,623,327 $ 15,191,517 $ 26,089,574 Gross Sales $ - $ 16,260,148 $ 18,004,418 $ 19,797,358 $ 20,977,585 Cost of Goods Sold $ - $ 3,252,030 $ 3,600,884 $ 3,959,472 $ 4,195,517 Gross Income $ - $ 13,008,118 $ 14,403,535 $ 15,837,886 $ 16,782,068

Operating Costs $ 1,644,936 $ 3,813,039 $ 3,916,798 $ 4,021,283 $ 4,092,429 EBITDA -$ 1,644,936 $ 9,195,080 $ 10,486,737 $ 11,816,603 $ 12,689,639

Bank Loan Pmt -$ 918,547 -$ 918,547 -$ 918,547 -$ 918,547 -$ 918,547 Annual Cash Flow -$ 2,563,483 $ 8,276,533 $ 9,568,190 $ 10,898,057 $ 11,771,092 LOC -$ 89,722 $ - $ - $ - $ - Accumulated Discretionary Cash Flow -$ 2,653,205 $ 5,623,327 $ 15,191,517 $ 26,089,574 $ 37,860,665

Capitalization Rate 36.5%

Invested Capital: $ 12,702,972

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Projection 4 1 2 3 4 5 Starting Cash -$ 2,653,205 $ 631,177 $ 4,671,694 $ 9,491,615 Gross Sales $ - $ 11,267,997 $ 12,476,746 $ 13,719,222 $ 14,537,099 Cost of Goods Sold $ - $ 3,252,030 $ 3,600,884 $ 3,959,472 $ 4,195,517 Gross Income $ - $ 8,015,968 $ 8,875,862 $ 9,759,750 $ 10,341,581

Operating Costs $ 1,644,936 $ 3,813,039 $ 3,916,798 $ 4,021,283 $ 4,092,429 EBITDA -$ 1,644,936 $ 4,202,929 $ 4,959,064 $ 5,738,467 $ 6,249,152

Bank Loan Pmt -$ 918,547 -$ 918,547 -$ 918,547 -$ 918,547 -$ 918,547 Annual Cash Flow -$ 2,563,483 $ 3,284,382 $ 4,040,517 $ 4,819,920 $ 5,330,605 LOC -$ 89,722 $ - $ - $ - $ - Accumulated Discretionary Cash Flow -$ 2,653,205 $ 631,177 $ 4,671,694 $ 9,491,615 $ 14,822,220

Capitalization Rate 21.7%

Invested Capital: $ 12,702,972

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Summary of The following summarizes the findings from the financial analysis for the four Resu lts projections described above.

• A 10 MT/hr hemp decortication plant, shipping fibre, hurd and dust to Edmonton via truck generates a capitalization rate of 32.7% with payback on invested capital ($12.7 million) by Year 4. The accumulated discretionary cash flow at the end of year 4 equals $21.3 million.

• Increasing the invested capital to 70% ($17.8 million) of total capital requirement ($25.4 million) increases the accumulated discretionary cash flow to $23.9 million by year 4 but decreases the capitalization rate to 29.6% (see Figure 11).

Figure 11: Cash Flow in Year 4 Relative to Initial Investment

• Two projections were used to demonstrate the effect of the price of hemp fibre. The first illustrates what happens when the price of fibre increases to $1,500/MT and the second shows what occurs when it drops to $800/MT. For a 10 MT/hr plant with 50% invested capital ($12.7 million), the capitalization rate increases to 36.5% and comes forward to year 3 when fibre increase in value and it drops to 21.7% and pushes out to year 5 when fibre decreases in value (Figure 12).

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Figure 12: Cash Flow Relative to Hemp Fibre Prices

• The economic model shows that building a 10 MT/hr hemp decortication plant generates a healthy return on investment under that assumptions that hemp straw prices remain low and hemp fibre prices remain high.

The choice of Barrhead for the benchmark analysis in no way suggests that this location is the most favorable choice to locate a decortication plant. The model requires that a given location be used in order to generate the results for comparison purposes. What it does illustrate is the relative importance of cost of goods sold and market pricing.

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6.0 Conclusions

The basic findings of this feasibility study are that under the market conditions identified, 10 MT/hr hemp decortication plant offers the largest benefits for investors regarding an earlier payback period and the largest accumulated cash flow. A 10 MT/hr plant, located in a favorable region, returns an investors capital in three years with a capitalization rate of roughly 20-35% depending on the price of hemp fibre on the world market.

Regarding where to place the decortication plant, the various site locations need to be assessed on an individual bases to determine their transportation cost advantages, municipal tax rates benefits, and the productivity of their surrounding farmland. However, increasing the distance to haul hemp fibre pushes the payback period later and reduces the cash flow of the operation. Similar results are found with higher municipal tax rates and having to draw from a larger area to source hemp straw (i.e. fewer productive acres in the surrounding region). Therefore, these factors need to be considered when choosing a site location.

While producers in Alberta have recently seeded enough hemp to supply a 10 MT/hr decortication plant, there is by no means a large surplus at this time. As a result, following any initial investment and breaking ground for a decortication plant will need to be followed by outreach to establish growing contracts with farmers in the surrounding region in order to secure hemp straw. With yield improvements in the coming years the required acreage to supply a large decortication plant will decrease but securing supply in the beginning is crucial for the viability of this facility.

In the first years of operation the critical costs for the decortication plant are interest payments on commercial loans, municipal taxes and the cost of goods sold. The price of hemp straw incorporated into this analysis is $114/MT, which allows for accumulation of discretionary cash and various capitalization rates according to the level of invested capital and the price received for hemp fibre.

All of the regions taken into consideration for this assessment have the necessary qualifications to host a hemp decortication facility. However, some regions boast advantages in areas that are critical to keeping down costs. The regions of GROWTH Alberta and Alberta HUB are particularly well suited to hemp processing given their proximity to both Edmonton and the Saskatchewan border, in addition to their relatively large workforces compared with some other regions. In addition, some locations within these two regions have advantages with lower municipal tax rates and access to rail infrastructure, both of which are key to keeping down costs.

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October 8, 2019

Dear Members,

We would like to thank you for your countless years of support towards Mighty Peace Tourism and continuing to make this organization possible.

We are constantly looking to create efficiencies in the organization and due to a few key budget choices we have been able to reduce the original plan of larger yearly increases to only a modest cost of living increase. Municipal membership fees will increase by 2% from $2.60 to $2.65 per capita as voted on and passed at the Board of Directors meeting on September 30th, 2019. The new fees will come into effect as of January 1, 2020.

We look forward to working again with you this year.

Sincerely,

Norm Duval President, Mighty Peace Tourism

Box 1697 | Grimshaw, Alberta | T0H 1W0 | 780-332-2363 | [email protected] Page 70 of 272

SUNRISE GATEWAY BUSINESS PARK 2019 DEVELOPMENT STRATEGY

August 2019 Page 71 of 272

Table of Contents

Executive Highlights Section 1 Background 7 Section 2 Overview of Northern Sunrise County 9 Section 3 Population & Traffic Counts 12 Section 4 Agriculture in the Peace Country 17 Section 5 Mil Rate and Property Costs 19 Section 6 Potential Opportunities 22 Section 7 Financial Mentoring 33 Section 8 Cooperatives 34 Section 9 Municipal Process and Procedures 37 Section 10 Municipal Incentives 39 Section 11 Summary Recommendations and Closing Comments 44

Appendices

A Sunrise Gateway Buisness Park – Proposed Phase Development Map B Population Charts – By Gender and By Municipality C Peace Region - Retail Trade Profile D Traffic Schematic – 2018 Average Daily – HWY 2 & HWY 688 Alberta E Agriculture Exports F Request for Entrepreneurial Grant G Alberta New Municipal Tax Incentives H Entrepreneur Bootcamp - Agenda I Map of Gasoline Alley – Loop Concept

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This report is in reference to Northern Sunrise County, Alberta. Location circled on the map below.

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Executive Highlights Economic Development is the practice of selling your community to a potential buyer. The community is a commodity, hopefully one that someone wants to invest in. The buyer is a business, developer, or investor that is looking for a community to set up in. In order to successfully sell itself Northern Sunrise County must think of itself as the commodity for sale and then several factors need to be in place:

A) you must have something that makes you stand out from the crowd to the buyer; B) there is market demand for what you are selling; C) you have available land, properties, housing, labour, water, and utilities. This can be more challenging for rural municipalities than for urbans, simply because there is not always a definable business centre and frequently, access to infrastructure and services is limited. Northern Sunrise County benefits from having a serviced industrial park strategically located off Highway 49 at the entrance to the Town of Peace River; referred to as Sunrise Gateway Business Park (SGBP). Northern Sunrise County has had considerable success in the development of Sunrise Industrial Park. What has been identified as lacking, is service-related industries that would benefit existing businesses, through-fare traffic, and area residents. In order to successfully sell itself Northern Sunrise County must think of itself as a commodity for sale and then several factors need to be in place.

1. The community must have something that makes it stand out from the crowd to the buyer. There are 352 municipalities in Alberta, varying from summer villages to cities. The buyer intends to put his business in one of those municipalities. Most municipalities market themselves as “the best place to live, work and play.” But are they really? It is essential a municipality knows it faults and is honest about them. A potential new business will do their homework and find out anyway. So, what makes Northern Sunrise County, and in particular SGBP, better than all the rest? What makes Northern Sunrise County a contender?

2. Many factors, including marketing region, transportation, access to commodities, access to labor force, access to services, property prices, property taxes, etc.… all impact an investor’s decision on where to locate. Ultimately the investor wants to make money. Can they make money locating their business in Northern Sunrise County?

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3. Demand for the product. In the case of retail and hospitality, there must be enough population to support the business. In today’s high labor, high tax (carbon tax) environment, more and more restaurants are closing. Hotels are also suffering with the slow down in the economy. The decline in the oil industry has greatly impacted not only the accommodation industry, but also service industries, from laundry services to fuel to groceries. Less people and fewer people with the financial resources have made these businesses less viable.

4. Marketing region refers to the region from which a business can draw customers. Northern Sunrise County has an excellent location and draws from about 17,000 people in a 45km radius plus through-fare traffic on the highway to and from Peace River and beyond. Most businesses require a certain number of people in the region for them to be viable. The one exception is niche stores, such as butcher shops, high-end ladies’ fashion, giftware, greenhouse, and antiques that people will travel greater distances to specifically shop there. Attracting or encouraging a business destined for failure is pointless.

5. Because of the financial challenges in setting up a new business, or even assuming ownership of an existing one, the cost is crucial. Land and building values are important. Equally important however, is the quality or existence of infrastructure. Any retail chains (including drive-thru restaurants) will be looking for new-build highway frontage. Northern Sunrise County has highway frontage property available, however access is a challenge.

6. Property costs and availability greatly impact the decision of a business to locate in your community. It is important to have an inventory of available properties and contact information for the owners.

7. Incentives to attract or sustain businesses is controversial. Providing tax incentives to new developers can anger existing business owners who invested in the community with no such incentives. On the other hand, waiving taxes to attract new businesses can be the incentive a business needs to locate in your community. Additionally, in the case of businesses that have a small profit margin (restaurants) this may be necessary.

8. In addition to property prices, property taxes can have a huge impact on where someone will set up business. Northern Sunrise County has a very competitive mil rate. The non- residential mil rate is the lowest amongst its competition in neighboring urbans and compared to the West hill. Its residential mil rate is second lowest.

Municipality Residential mil rate Non-residential mil rate

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Northern Sunrise County 5 13. Town of Peace River 8.928 16.2943 Nampa 5.48 14.23 M.D. of Peace 4.3405 13.77 County of Northern Lights 6.2016 14.0093

Property taxes matter. City of Calgary businesses have seen a substantial hike in their property assessments and subsequently their property taxes.

9. Other factors can mitigate the mil rate. Location, location, location! Highway 2 runs through Northern Sunrise County. There are approximately 5000 vehicle movements in the SGBP area everyday. Of that, daily traffic counts on Highway 2 average 2500+ with an additional 500+ on Sunrise Road and 1000+ on Highway 688. T

10. There are 1861 residents in the County. While the trading area is estimated at around 17,000 people, it should be noted that most Peace River residents will not venture up the East Hill for services they can readily find in town. This needs to be kept in the forefront when approving new businesses in Sunrise Park.

11. Access to labor and housing is important to developers and investors. Northern Sunrise County does not have an issue with either of these requirements. Again, drawing from a population in excess of 17,000, Northern Sunrise County, as in all the municipalities in the area, draws workers from a large radius. The challenge is more on the low paying or minimum wage jobs. Housing, likewise, is diverse and available. Employees can live-in surrounding municipalities. Also St. Isidore has housing, including the St. Isidore Housing Coop which features 20 two and three-bedroom properties and presently has vacancies.

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12. There is a reason the consumer has turned to online shopping. Online catalogues let consumers shop easily and comfortably, from their home, peruse products, select what they want, go the shopping cart and identify all applicable costs. No one likes it when a product is hard to find, the price tag is missing, there isn’t a salesperson to be found and where exactly is the cashier? Additionally, the product is delivered to the customers home often the next day or within a week of ordering, often with no shipping charges.

13. A targeted proposal / business case for an agriculture value added processor should be on Northern Sunrise County’s priority list (though not specially to be located in Sunrise Park). This proposal needs to be concentrated on one (or two) of the agriculture commodities grown in the Region.

14. It is essential that Land Use By-Laws be up-to-date and have been thoroughly revised to allow developments you want in your municipality. In the time it takes for a municipality to rezone a property to accommodate a potential business, that business can locate in another community. Ensure the Land Use By-Laws reflect Council’s vision of what businesses they want AND where they want them in the County.

15. Equally important is aftercare. People love online shopping and Costco, because if they are unhappy with their purchase, they can send it back for a full refund. Well, a municipality can’t do that. But what it can do is ensure that once a business moves in, they do their due diligence and follow up to ensure the business is happy. Visit the new business. Promote it on the municipal website. And utilize the business.

16. Shop local. A common complaint from all businesses, including industrial and retail is that locals (both residents and businesses) do not shop local.

17. Esthetics. Plain and simple, people want to live in an attractive and well-maintained community. We want pretty streets (that doesn’t mean paved) with cared for yards, free of derelict buildings and junk. This includes highway frontage and industrial/commercial properties.

16. It is recommended that Northern Sunrise County focus on three primary development opportunities relative to SGBP: Note the running under-current of incorporating local products to enhance and promote current consumer trends. a. Restaurant / Café / Can Local products be used? b. Speciality Foods / Products / Can Local products be used? c. Multi-purpose / private venue – Hotel / Casino Can Local products be used?

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Section 1 Background In February of 2019, Northern Sunrise County contracted Aylward Research Services to complete an assessment of previous economic development work completed on the SGBP (Appendix A – Phase Development Map), which included current active businesses and previous strategic recommendations, and to provide recommendations for “next steps” in development.

In partnership with the recently recruited Economic Development Officer (who was actively involved in the report development and background data collection), this report also includes details of the types of information an Economic Development Officer needs to have on hand in order to actively pursue and engage potential commercial ventures into a community.

Previous Strategy: In 2016, Northern Sunrise County completed their “Strategies for Economic Diversification in Northern Sunrise County” report. The report done by PlanAlberta identified six key strategies for the County to pursue:

1. Develop a youth strategy as part of an overall population attraction strategy 2. Continue focused development of Sunrise Park 3. Support the growth of existing businesses 4. Provide maximum support for entrepreneurship 5. Work regionally and within the County to develop tourism, and 6. Attract new businesses that are linked to existing strengths

The PlanAlberta report identified some key industries or businesses that could be attracted to the Park which would build upon existing businesses in SGBP:

• Truck stop • Truck wash • Machine shop for Large repairs • Hot shot service • Welding service • Equipment rental

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Additionally, PlanAlberta identified opportunities for travelers and visitors and included: • Convenience store/tourist information • Coffee shop • Restaurant • Take-out Food (based on17,000 local population within 45-minute radius) • Gas station • Rest stop with access to the park • Gift/craft store with local products The PlanAlberta report also identified the following light industrial opportunities: • Poultry processing (small scale) • Commercial building for beekeepers, bakers and other value-added • Cooperative of local value-added product manufacturers • Containerizing in partnership with Grande Prairie • Farm equipment rental • Farm equipment dealership other farm supplies

Northern Sunrise County administration has been working on implementing the various aspects of the PlanAlberta report. Unfortunately, the slow down in the economy brought on by slumping oil prices has greatly impacted investment in the County as well as the region. During the course of compiling this report some of the above-mentioned opportunities were revisited; additional new opportunities were also considered.

There are four primary purposes a municipality creates a business development strategy: 1. To build consensus and understanding amongst and with Council and administration on the direction they wish the municipality to go economically; 2. To work together in establishing an economic vision for the community that is internally supported through appropriate by-laws, land-use clarification, processes and priorities for Council and administration to focus on achieving that vision; 3. To create and implement a follow-up action plan that incorporates the information collected in the economic development strategy; 4. And finally, to encourage growth in your community hence increasing your community’s tax base and viability.

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Section 2 Overview of Northern Sunrise County Northern Sunrise County was incorporated in 1913; became a municipal district in 1994, and renamed to a County in 2002. The County sits on the banks of the Peace River, with its administration building located seven kilometers east of the Town of Peace river.

The Village of Nampa is the only urban municipality within its boundaries, though it does border the Town of Peace River. Additionally, there are five hamlets; Cadotte Lake, Reno, Little Buffalo (soon to become a reserve), St. Isidore and Marie Reine. The largest hamlet with multiple services and a strong francophone ancestry is St. Isidore. There is a total of 1,891 residents and 901 dwelling units.

The majority of retail services are sourced out of the Town of peace River, however, residents also frequent Grande Prairie, with a population of just under 70,000 residents. Highway 2 and HWY 688 run through the County as well as 1158km of municipal roads. Canadian National Railway also runs through the County with a major grain terminal and rail pick-up point located on the tracks behind the Village of Nampa. Commercial and charter air service are available through the Peace River Airport, approximately 20km west of the County. The main industries are oil and gas, forestry and agriculture.

The development of SGBP has been a focus of Northern Sunrise County for almost 20 years. Over the years the County has streamlined its strategic phased-in plan with increasing successes of bringing businesses and light industrial into the Region. SGBP has been recently expanded into the next phase of its development vision which is opening new opportunities for industry, and retail and hospitality industries.

Northern Sunrise County has invested in ensuring the lots available are fully serviced. Though at first glance the property prices appear high; any developer with experience will appreciate the amount of paperwork, permits, finances, and time that these “ready for building” lots save them in their development timelines.

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Community The Community Services Department provides cultural, recreational, and preventative programs through Family and Community Support Services (FCSS), that enhance the quality of life for those living in or visiting the County. The Community Services department takes pride in partnerships with surrounding municipalities and various community organizations in providing programs and services that enhance the well-being of residents and visitors alike. Education Students in the County have multiple options for primary education, including public, separate and francophone education in several communities. Post-secondary education is available locally through Northern Lakes College.

Agricultural Society and Community Centre Halls & Agricultural Societies aid in the growth & maintenance of the County and the surrounding communities. They provide an opportunity to develop and adapt programs or services based on the needs of the community and its residents.

Health Services County residents access health care at the Community Health Center in Peace River. Services include mental health, diabetes prevention & wellness, immunizations, prenatal classes, home care, diagnostic imaging, emergency and laboratory, and palliative care. A newly constructed medical clinic is being completed on Peace River’s West hill. The clinic is designed for up to 28 doctors and will be complete with state-of-the-art equipment.

Recreation County residents access most recreational services through a partnership with the Town of Peace River. The Peace Regional Recreation Centre, presently under construction, will contain an NHL sized rink, a multi-use field house, a three-lane walking track, a fitness room, three multipurpose community rooms, and an indoor children’s play space. Additionally, an indoor swimming pool, multiple outdoor rinks, curling, fitness facilities, skate parks, splash parks, outdoor swimming pools etc. are all within the radius of Northern Sunrise County. For example, Cecil Thompson Park, a local landmark, features a bouncy pillow, challenging outdoor exercise equipment, a fishing pond, gazebo a walking bridge and unserviced camping spots.

In addition to municipal infrastructure, the region is an ideal area for outdoor recreation. There are numerous ski hills and golf courses, and many campgrounds, and opportunities for boating, hunting and fishing. For example, Harmon Valley park features 17 unserviced camping spots, and is close to the Harmon Valley grounds, home to infamous Harmon Valley Rodeo.

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The Heart River Golf Course features nine holes, a driving range, pro shop and clubhouse and is a regional favorite. There are also numerous lookout points in the county including Sagitawa lookout and the Twelve Foot Davis gravesite which overlook the majestic merging of the Smoky and Peace Rivers (picture below).

Culture St. Isidore is home to the St. Isidore Museum and Cultural centre which showcases the artifacts of the founders of St. Isidore, the youngest French-Canadian community in Western Canada. Also located here is a library, community hall, the St. Isidore Weavers and it is home to the Carnaval de St. Isidore, a much-loved winter celebration of the French culture in the Region.

Housing Housing is essential to attract new residents. And Industry looks at housing availability when they look to moving into a municipality. A business that may have 10 employees may need housing for 10 families. They may also need housing for senior staff. Current businesses need housing in order to attract employees. In addition to rural properties, St. Isidore is home to the St. Isidore Housing Cooperative. Northern Sunrise County’s proximity to Peace River, Nampa and Grimshaw provides potential residents / employees a wide variety of housing options, from single family to multifamily homes, condominiums, modular and manufactured homes and apartments.

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Section 3 Population and Traffic Counts – Identifying Customers Population Profile: This data gives you a snapshot of who lives in your community. The data can be invaluable when determining the programs and services that the municipality will invest in and offer to its residents. The diagram below shows the most current population combined for Northern Sunrise, MD of Peace, Northern Lights, Peace River, Nampa and Grimshaw. The raw data used to create the data presented in this section can be found in Appendix B .

Figure 1: Population of Northern Sunrise County and Selected Municipalities

Source: Alberta Economic Dashboard (Adapted from Statistics Canada, Population Estimates)

Note: The graph shows the total population of the selected municipalities for the last five years. The data is confirmed up to 2016; which is when the last federal census was conducted. For 2017 and 2018, the population is estimated by Statistics Canada.

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The pyramid figure shows the split of the population by gender.

Gender and age distribution are important elements of identifying potentials customers already within your radius. In reference to the pyramid for example, if the County receives an application for a nail salon, the number of females in the region would be of interest to that business owner. Added details that increase knowledge of the customer base can aide in targeted marketing, promotions, and even hours of operation. Factors such as age, income, and marital status are examples of such details available from Statistics Canada. The numbers are dynamic, ever-changing and never 100% at any point in time but they do provide a baseline to help move forward into a business plan.

Note: Drop in numbers for 20 - 24 year olds in the pyramid. This is not unusual as this is typically the university / college cluster which tend to leave their home towns.

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The radius population, which includes Northern Sunrise, MD of Peace, Northern Lights, Peace River, Nampa and Grimshaw is shown below.

Population – Selected Radius Relative to the economic development areas of focus NSC, MDP, CNL, NP, PR, GR suggested in this report, (e.g.…Casino/Hotel, Specialty Age Group Total 0 to 4 years 1285 Foods), the older adult (45 to 65), with higher levels of 5 to 9 years 1225 income, would be the first recommended targeted group 10 to 14 years 1245 (e.g. has time and money to gamble). Note that there is 15 to 19 years 1235 20 to 24 years 1045 a niche target of seniors that enjoy casinos, however, 25 to 29 years 1285 this group would not be big spenders and usually are 30 to 34 years 1360 incorporated as “social outings”. The table shows “45 to 35 to 39 years 1175 40 to 44 years 1145 65” year olds make up 26% of the current population. 45 to 49 years 1110 50 to 54 years 1305 The added dimension of income level for the radius 55 to 59 years 1175 selected is shown below. Note the average income is 60 to 64 years 1045 higher within the selected radius when compared to the 65 to 69 years 730 70 to 74 years 510 whole Census Division (#17). This a positive direction 75 to 79 years 400 toward the target market. 80 to 84 years 275 85 to 89 years 140 90 to 94 years 50 95 to 99 years 30 100 years and over 5 Total Population 17,775 Average age 37.8 Average Income (after tax) $ Two Person Households Northern Peace Northern Peace DV 17 Sunrise No. 135, Lights Nampa, River Grimshaw 89,700 104,547 106,969 96,950 79,147 110,936 108,137

NOTE: In companion with this report is an attachment of a Peace Region Retail Trade Profile. This report was completed on behalf of all the municipalities within the Peace Region Economic Development Alliance (PREDA. The report provides an overview of the population, it’s purchasing power and spending habits, the businesses in the area, and identified potential areas for new business development (Appendix C).

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Traffic Counts: Population numbers reflect who lives in your radius NOW and help to identify the first level of a customer base in a business plan. Collectively casinos, restaurants and specialty shops also lend themselves well to drive-through transient traffic. Fortunately, the Department of Transportation has a traffic counter located on the corner of Hwy 2 and HWY 688, a key juncture relative to Sunrise Park. Data is collected daily and available for download. Dept. Annual summaries are presented in a schematic (below), that show the average daily number of vehicles, the direction the traffic is coming from, and the type of vehicle recorded (shown for demo only a larger print-out is in Appendix D).

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The amount of information presented in these schematics is invaluable for projecting potential customers. They are frequently used by site locators and investors. These schematics are available for 5 years for the Hwy 2 & Hwy 688 junction.

When analyzing the traffic schematic for valid market numbers it is critical to track the directional arrows to isolate through-fare traffic and left / right tuning traffic. There is over-lap. For example, when only through-fare traffic from the north is tracked there were 1330 vehicles recorded. This is because from the original number coming down from the North, on average 740 vehicles turn left onto Highway 688. This number is also included in the “Average Daily Traffic = 2000” for HWY 688. Hence over-lap.

From the schematic, on average, on any given day there are 2650 vehicles counted. 1330 vehicles coming down from the North on Hwy 2 that drive through the junction. 1320 vehicles coming up from the South on Hwy 2 that drive through the junction. 740 vehicles coming down from the North on Hwy 2 that turn left onto HWY 688 260 vehicles coming up from the South on Hwy 2 that turn right onto HWY 688.

The table shows the percentage breakdown of the average daily traffic counts by vehicle type.

Percent Type of Traffic at HWY 2 & HWY 688 Juncture

Passenger Vehicles 68%

RV’s 2%

Buses 1%

Single Unit Axel 7%

Tractor Trailers 23%

Traffic counts add another layer of a potential customer base for SGBP. Also, depending on the type of new business, for example, an industrial truck wash, the number of tractor trailers would be an important factor to consider.

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Section 4 Agriculture in the Peace Country

Northern Sunrise County is surrounded by agriculture. The County sits in the middle of the most northern agriculture region in the world – affectionally referred to as the Peace Country. Over the decades and generations of collective farming knowledge, the Peace Country has become internationally renowned for its superior agricultural products. The table shows the active agriculture land across the Peace Country and the top agriculture products this land is dedicated to.

Photo – Mighty Peace Tourism Member -Pure Instincts

Northwest Alberta 2016 - Cropland (Acres) - By Municipality By Type of Crop Alfalfa Dry Field Tame Hay Acres / Product Oats Canola Wheat Mixes Peas Barley Fodder Canada 20,606,778 23,436,513 9,276,755 4,291,872 6,696,068 4,851,167 3,159,687 93,382,638 Alberta 6,165,746 7,008,542 3,056,701 1,909,491 3,413,856 1,161,521 822,185 25,261,781 NW-AB #1 #2 #3 #4 #5 #6 #7 3,934,383 1,293,166 948,882 459,467 432,825 263,288 204,012 192,481 N. Sunrise 71,533 55,349 9,867 15,431 5,648 7,373 2,521 Big Lakes 38,843 29,340 27,583 6,925 8,617 32,814 6,603 Clear Hills 43,061 46,722 46,918 63,360 20,883 19,441 21,311 N. Lights 109,552 92,300 45,851 x 31,541 17,885 14,006 Mackenzie 118,761 68,991 33,505 50,299 24,231 9,273 52,983 Greenview 79,474 57,714 49,491 13,496 17,914 32,822 20,410 County GP 156,661 109,731 123,235 42,233 73,873 39,224 23,207 Smoky River 259,729 194,602 7,689 48,672 16,940 4,336 3,734 Birch Hills 149,018 82,982 17,053 41,159 25,842 3,081 3,557 Spirit River 45,252 32,390 5,812 30,525 7,492 3,765 5,046 Saddle Hills 78,833 81,914 55,547 48,325 17,269 19,165 23,632 Fairview 99,265 66,825 17,149 21,561 7,440 5,027 6,341 Peace 35,335 22,505 8,061 22,253 3,559 5,596 4,324

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Also, located within Northern Sunrise County is a grain terminal (currently owned by Richardson Pioneer) with a capacity of 44.5 Metric tonnes and direct access to CN Rail. This grain terminal (Nampa) is one of 12 available in the Peace Country. The tables below show the grain terminals in the Peace Country and the volume / type of raw grains that were exported (by rail car) from the Region for the 2017-2018 crop year.

Grain Terminals in Peace Country FALHER Agrocorp Processing Ltd. 7,200 GRIMSHAW Viterra Inc. 32,760 HIGH LEVEL Richardson Pioneer Limited 6,500 MCLENNAN Cargill Limited 27,800 NAMPA Richardson Pioneer Limited 44,580 RYCROFT Grain Millers Canada Corp./ Louis Dreyfus Company / Richardson / Cargill 90,000 SEXSMITH Viterra Inc. 30,250 SMOKY RIVER Viterra Inc. 41,420 Northwest Alberta – Deliveries to Primary Elevators 2017-18 Thousand Metric Tonnes Production 1,162,200 197,700 265,900 1,296,900 399,400 Delivery Point / Crop Wheat Oat Barley Canola Peas NAMPA 131.9 - 3.1 166.8 14.8 RYCROFT 234.1 - 23.8 402.0 133.9 HIGH LEVEL 56.7 - 3.7 56.2 21.5 SMOKY RIVER 139.0 0.1 13.6 160.2 40.3 SEXSMITH 166.5 - 64.0 134.8 63.3 MCLENNAN 151.8 - - 132.0 20.0 FALHER 34.7 - - - 23.7 GRIMSHAW 108.9 - 50.4 173.1 73.5 Total Delivered 1,023,700 100 158,700 1,225,000 391,100 % of Production Delivered 88% <1% 60% 94% 98%

There may be an opportunity for Northern Sunrise County to pursue a value-added agriculture industry. The County should look at potential grants to develop a business case for a specific agriculture commodity. It is anticipated that once the international political arguments subside there will be a resurgence of interest in Canadian agriculture from international buyers. Exports of Alberta agricultural products are listed in Appendix E. If Northern Sunrise County is interested in developing a business case PREDA can assist with a small amount of funds through the Municipal Project Fund to leverage against provincial / federal grants.

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Section 5 Mil Rate and Property Costs

There are several factors that come into play when a business or individual decides to locate in a community. Land and property values are two of these factors. The availability of land and the cost (both serviced and unserviced) is especially important to new developments. Property taxes associated with land can be an impeding factor or a competitive advantage.

Property taxes are determined by the municipality. The tables below provide a snapshot of where Northern Sunrise County sits in the region with regard to property taxes. Northern Sunrise County has the fifth lowest non-residential mil rate in the region while it’s residential mil rate would place sixth lowest. While the residential mil rate is important for attracting residents, other factors, such as living in a desirable location, could impact a person’s decision to buy a residence in a specific municipality.

Highest Non-residential mil rates in the Peace Country Municipality Non-residential Village of Hines Creek 36.72 Town of McLennan 29 Lowest Non-residential mil rates Village of Berwyn 28.5342 in the Peace Country Village of Rycroft 20.91 Municipality Non-residential Birch Hills County 18.1823 M.D. of Greenview 7.828 Town of Wembley 10.8091 Town of Grimshaw 10.8199 Town of Beaverlodge 12.4432 Northern Sunrise County 13

Highest Residential mil rates Lowest Residential mil rates in the Peace Country in the Peace Country Municipality Residential Municipality Residential Town of McLennan 19 Clear Hills County 1.3022 Village of Hines Creek 17.11 M.D. Greenview 2.7 Village of Girouxville 16.123 County of Grande Prairie 4.04436 Town of Falher 12.17 County of Big Lakes 4.305 Town of Manning 11.4225 M.D. of Peace 4.3405 Northern Sunrise 5

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The following table focuses on municipalities that would be in direct competition with Northern Sunrise County in attracting a commercial development where rail and road corridors are relevant. This would include a value-added industry such as an agricultural milling company. While the municipalities may not be adjacent to the County their proximity to commodities, road and rail, make them a competitor.

Northern Sunrise County - Industrial Competition Municipality Residential mil rate Non-residential mil rate Village of Rycroft 10.041 20.91 M.D. of Spirit River 7.2 15.527 Town of Spirit River 11.0886 13.5071 Town of Sexsmith 7.5777 16.4687 County of Grande Prairie 4.04436 13.4765 Town of Falher 12.17 15.661 M.D. of Smoky 5.3 16.308 City of Grande Prairie 10.2087 16.374 M.D. of Greenview 2.7 7.828 Saddle Hills County 3.87672 12.6 (Woking) M.D. of Peace 4.3405 13.77 Village of Nampa 5.48 14.23 Town of Grimshaw 7.9128 10.8199 County of Northern Lights 6.2016 14.0093 Northern Sunrise County 5 13

The municipalities in the table were chosen as competition to Northern Sunrise County based on agricultural production and transportation corridors. Rycroft and the surrounding region handle the most agricultural products along with the Smoky River region. An agricultural value-added business would want rail access and excellent highway access. As these areas are the major grain transport locations, they have an advantage.

In the case of service industry developments in SGBP, Northern Sunrise County does have the advantage of having serviced property. Most industry requires potable water in addition to gas and power. Most rural municipalities lack potable water and often other utilities need to be put in at the developers cost. This can often be the deciding factor in where an industry chooses to locate.

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Foreign investors when looking at locating in Alberta, tend to look at Alberta’s larger centres and along the QE2 Highway between Edmonton and Calgary. When looking north, they tend to look at Grande Prairie and the surrounding County of Grande Prairie. Based on the previous table, comparing both of their mil-rates, it is clear why so much development is happening in the County.

Another key factor in helping an industry decide where they will locate is the level of municipal readiness and service. How ready a municipality is with all development documents; are the relevant land-use-bylaws in place, and how knowledgeable the staff are, can make the difference between one municipality and the other.

Property Inventory Something that can slow down or lose a development is not having property immediately available. It helps to have a running inventory of available properties in Northern Sunrise County, so you are able to supply something quickly. The Economic Development Officer of Northern Sunrise County has a portfolio “ready” which includes a list of properties, relevant Land-Use By-Laws, application forms, and contact sheets for utility services and development inspectors to help expedite developments. Excellent!

Serviced vs unserviced This is important when you are sending a proposal to a potential business. If you are building a business case for a new development on the tracks or a retail business downtown it helps to know what is available and an approximate price point. Some developers want to invest immediately. Being delayed by not knowing what property is available, what the development process is, what services are available or having unhelpful staff can send a development elsewhere. Every community says they are open for business but are you really? Municipally held and private Northern Sunrise County already has a property inventory of municipally and privately-owned land.

The reality is industry will base their decision on a combination of these factors. Developers may also be looking for serviced land, high speed internet or an existing site with infrastructure. Developers from outside the region also have concerns around access to workers and housing for their employees. Considering all the mentioned factors above, Northern Sunrise County is in an excellent position to attract industry into the Region, and to Sunrise Park.

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Section 6 Potential Opportunities

Based upon the review of previous economic development efforts, feedback from current business owners, research data, and the County’s level of readiness, it is recommended that Northern Sunrise County focus on three development opportunities within the Park:

1) Restaurant/Cafe; 2) Specialty Foods / Products; and 3) Multi-purpose venue - Hotel/Casino

Opportunity #1 Restaurant / Café

One of the key businesses Northern Sunrise County wishes to attract to the Park is a restaurant. There are several key factors that potential restaurants look for when selecting a site. Traffic and market area are key for the success of restaurants.

According to an IBIS World report (https://www.ibisworld.com/industry-trends/market-research- reports/accommodation-food-services/single-location-full-service-restaurants.html) on single location full service restaurants, 67% of a restaurant costs go directly to wages and purchases expenses. Additionally, the average profit margin for a restaurant, after removing all other costs, is only 6.2 percent.

The report also identified that the industry is exposed to the following threats and opportunities:

• Consumers are becoming increasingly aware of issues related to weight and obesity, fatty food intake and food safety issues. Consumers are now more aware of the health issues associated with fatty foods and are increasingly going out of their way to avoid them. The healthy eating index is expected to remain strong but flatten by 2018. This factor remains a threat to industry operators, especially those with limited to no healthy alternatives.

• Factors that influence the growth of consumer spending, such as taxes, consumer sentiment and the economy, also affect demand for this industry. Additionally, any spike in unemployment generally leads to a decline in spending. Conversely, when economic conditions are good, consumers will be more likely to spend money on eating at restaurants. Consumer spending is expected to increase after 2018, presenting a potential opportunity for the industry.

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A report conducted by the Perry Group International,( https://www.perrygroup.com/) (hospitality industry experts) revealed that most restaurants close during their first year of operation. Seventy percent of those that make it past the first year close their doors in the next three to five years. Ninety percent of the restaurants that are still operating past the five-year mark will stay in business for a minimum of 10 years.

Year One Failures - According to the Perry Group, many restaurants, particularly independent establishments, fail during their first year because they are undercapitalized. Many restaurant owners don’t have contingency plans in place for construction overruns or other unexpected opening expenses, and this leaves them short on money before they even open their doors. Of those that make it to the formal launch, many do not have sufficient funds to cover their operating costs. To have enough money to operate properly, fledgling restaurants should have enough money in the bank to cover their immediate costs plus an additional food and beverage reorder, two payroll cycles and six months of rent.

The Community Futures (CF) in Peace River cites similar statistics. “From our experience, 90% of all independent restaurants in our loan portfolio have failed. Failure was a result of many things, but in common with all was being undercapitalized and poor management.

“Yet 100% of the franchises we have/had in our portfolio are successful. This is mainly due to location research by the franchise, rigorous screening of candidates, significant cash investment by the owners, intensive training, systems for streamlined operations and brand recognition/shared marketing dollars. In my opinion, restaurant franchises in our region have a much better success rate than independents.”

“From a financing perspective traditional banks generally stay away from restaurants as they have a very high failure rate. They would possibly entertain a loan with 50% down if there was a building involved (for security) in the deal and it was a franchise. They would likely not look at an independent restaurant.

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“As for how much capital they need to get started, it comes down to two things: Kitchen Equipment, Leasehold Improvements. If the restaurant needs a deep fryer, kitchen costs increase tremendously, as they would need a fire suppression hood on the roof of their building which can cost between 20K – 25K. Food inventory is a minor expense.” “It costs approximately $3,972.80 per seat to open a small restaurant in Canada (taking into account basic kitchen and lease hold improvements, chairs, tables, etc..). In your client’s case that would be approximately $158,912.00. If it is an independent restaurant, it will be difficult to get financing, even with us. CF would want to see that the client has least 5 years’ experience managing a restaurant and 50% down payment. (80,000.00).” Deb Kayln, the CF Business Analyst In all likelihood, it may be difficult to find an entrepreneur that has the financial capital to get started. Add to that the lack of viable retail space adds to the challenge. Should a local property owner see value in building a strip mall with retail space for lease the probability would increase.

Economic Development Surveys In a survey of the 15 businesses located in SGBP (February 2019) all respondents stated that they would like to see a restaurant. Fourteen stated a convenience store and four identified a car wash/truck stop as a need. Sunrise Park (including the County’s administration building) represents 127 employees. A restaurant survey, also completed by the Economic Development Officer of Northern Sunrise County, provides some insight into the eating habits of the County’s residents.

Restaurant Survey

“How often do you eat out?” 40% cited once a week, 29% cited Twice a week and 31% stated one a month. “What time of day are you most likely to visit a restaurant?” 53% stated supper, 38% stated lunch and 9% said breakfast. “What day of the week are you most likely to visit a restaurant?” 56% said it didn’t matter, 21% cited weekdays and 21% choose weekends. The majority of respondents at 53% said they spend between $11 and $19 each per meal and 35% picked between $20 and $34. Fifty three percent of respondents wanted the option of selecting healthy food. And 23% said a healthy option was important: 21% said it was unimportant.

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When asked what would attract you to a new restaurant more than 50% stated menu options, food quality, prices and location. Least important were uniqueness, kid friendly, and a liquor license. Unsurprisingly when asked “What business would you like to see on the East Hill? Restaurant and convenience store were the most common answers.

Based on traffic counts, area population and local consumer feedback it would seem a restaurant and a convenience store would be viable options for the East Hill. However, based on the failure rate statistics, in order to attract a restaurant some form of incentive may be required to make this happen. Financial institutions are very wary about financing a restaurant. Even the Community Futures, a lender-of-last-resort is hesitant and usually will require the investor to have 50% of the capital required. Both will require a business plan.

Northern Sunrise County has two options to attract a restaurant into SGBP: Option 1 Encourage a local entrepreneur to start a restaurant. This will be a challenge. There is limited infrastructure in place for a restaurant to move into. There are available bays in SGBP, renting for $10 a square foot. Commercial lease space in Peace River runs between $11 and $15 per sq. ft. According to Yourbusiness.azcentral.com the standard minimum formula for a full- service dining establishment is five square feet of kitchen space per restaurant seat: A 40- seat restaurant, for example, calls for a 200-square-foot kitchen. Fast-food quick-service operations and restaurants that use prepackaged convenience foods and need less in the way of storage and prep areas will get by with less space. The average kitchen size is 30 percent of the total square footage of the restaurant. In fast-food or other quick-service restaurants, the majority of space is devoted to kitchen and storage areas. Seating space typically makes up less than 45 percent of the total area. Based on a 40-seat restaurant the owner would need approximately 800 square feet. Based $10 a square foot, the restaurant owner would be looking at $8,000 per month for a leased space not including utilities. They would also need to consider infrastructure improvements, kitchen equipment and furnishings. Then there would be operational costs, food and supplies, wages, marketing etc.…

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This option would be a daunting one and would require the individual to do a comprehensive business plan for two main reasons: one they will need financing and two they need to be realistic about the costs and potential revenues otherwise they too will be part of the 90% that don’t make it.

Option 2 Attract a franchise restaurant Statistics show franchise restaurants have the greatest chance of survival. Attracting one though can be a challenge. Franchises do their due diligence, part of the reason they tend to be successful. Northern Sunrise County has also done its due diligence gathering census data, completing a restaurant survey of local employees, traffic counts and developing marketing material for the County. Ultimately a local entrepreneur would need to be identified that would be willing to pursue this option Franchises, however, are not inexpensive. The minimum cash required for a Subway is $130,000, A&W $300,000, Harvey’s $270,000 and St.-Hubert $360,000. Additionally, most franchises scout out an area to ensure the location will be successful. It is also not uncommon for head office to own the infrastructure. In some cases, such as Tim Hortons, an existing franchise holder has the rights to a specific territory. The Peace River Tim Hortons owner has the rights to the NSC region. Should the owner see value in locating a Tim Hortons on the East Hill a business case would need to be made to Tim Hortons headquarters to justify a new location. This often includes evaluating if the site has the traffic volumes and would a new location cannibalize an existing location. A franchise restaurant such as Tim Horton’s has its own unique challenges, however it may be worthwhile to investigate other options such as Esquires Coffee (https://www.esquirescoffee.com/) with locations around the world, including Grande Prairie. Also, while not a franchise, Jeffries Cafe Co. (https://www.jeffreyscafe.ca/) also located in Grande Prairie may be worth pursuing to see if they would consider a location in the Park. .

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Opportunity #2 Specialty Foods / Products Introducing the idea of approaching Jeffery’s Café, a very successful local non-franchise restaurant, in the previous section brings us to the next potential opportunity for SGBP – special foods / products. In essence Special Foods / Products have customers that will “purpose travel” to buy items from them. This added element of customer loyalty increases the probability of success. Having an eating establishment that includes a unique concept like either craft beer, on- site coffee roasting, fresh baked goods, or local products can increase the success factor. For example, Almyra’s in Grimshaw, AB has a clientele list of hundreds of Peace Country women who shop exclusively at her “custom service store” there for Christmas ball-gowns and high-end brand name business clothes. Almyra’s offers a unique product that is not easily available to women in the Peace Country – she has been in business for 40 years! COBs bakery, COBS recently opened a franchise in Grande Prairie that specializes in artisan rye, sourdough and leven breads in paper bags! (very important to bread aficionados). Also, all regions in Canada are seeing a growth of local food preferences and events.

COBS Bread started in 1980 in Australia as a family run business called Bakers Delight. There are now over 600 Bakers Delight locations in Australia and New Zealand. COBS Bread has capitalized on this success with over 115 bakeries in Canada and is on track to establish 200 bakeries in Canada by 2022. COBS Bread offers substantial assistance, including financing and requires approximately $150-250K liquid capital on a total investment between $650K-$750K + tax. .

Taste of High Prairie Promotes Local Food - Sept 7, 2019 Taste of the Peace – Grow the North Premiere Evening Alberta on the Plate is a 10-day/9-city provincial dine around program that celebrates Alberta local food and drink. Each menu showcases local farms, producers, breweries and distilleries as part of Alberta Local Food Week.

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Opportunity #3 Multi-Purpose Venue Hotel / Casino

Hotel Having a hotel located on the East hill is one potential opportunity that would draw traffic off HWY 2 toward the Sunrise Road loop. There are several potential locations along the loop but ideally the corner of Highway 49 and Highway 688 would be ideal.

Two major hotel operators were contacted for information on the hotel industry. 1. Felix Seiler, COO with Holloway Lodging which operates: • Best Western Grande Prairie • Days Inn and Suites Whitecourt • Holiday Inn Hotel & Suites Grande Prairie • Quality Inn & Suites Grande Prairie • Super 8 Drayton Valley • Super 8 Grande Prairie • Super 8 High Level • Super 8 Slave Lake • Super 8 Whitecourt 2. Jackie Clayton, Vice President Public Relations and partnerships with Pomeroy Hotels which has hotels across the Peace Region, Alberta and British Columbia.

Additionally, research was done to assess the opportunity and costs of a new hotel in the region.

Hotel Industry Representatives Feedback On average Holloway Lodging plans for $135,000 per room construction cost. A 20-room hotel by their standard would be approximately $2.7 million. A 40-room hotel would be about $5.4 million. Holloway Lodgings pays approximately $1.1 million in property tax in Grande Prairie for their five hotels. The implementation of carbon tax has cost them an additional $250,000 in Grande Prairie and the increased minimum wage amounts to $500,000. In the Peace Region, Grande Prairie is experiencing the highest occupancy rates for hotels at 60%, the figure at which they break even. In 2016 they were down to 40%. In the last 10 years they were below 60% half the time. Their highest occupancy was 72% in 2014. Threats identified:

• Online travel agencies such as Expedia, Priceline, Booking.com – commissions up to 16% • Airbnb, private accommodation • Industry Work Camps – less regulations, less taxes, built in three months, portable • Supply increase – increases competition • Government regulations, increased ease of unionization, minimum wage, carbon & property tax • Changes to temporary foreign worker program – locals do not want the jobs • Technology – phones, Wi-Fi, cable – every room still needs a landline, though no one uses it. • Social media – reviews.

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During the boom years several new hotels opened in Peace River. Unfortunately, the economy dropped and there is an over abundance of available rooms in Peace River and has resulted in a decline in occupancy and room rates. This also makes the probability of attracting a stand-alone hotel improbable. However, if done in conjunction with a casino the possibility of it becoming a destination increases its viability.

Based on the slow economy and the decline of development in the oil and gas industry and the cost associated with building a hotel, the likelihood of attracting a new hotel is slim. However, as stated, a combination multi-purpose venue like a hotel/casino does offer possibilities and could also address the restaurant and convenience store sought after by Sunrise Park survey respondents.

Casino Alberta has five First Nations casinos: Casino Dene (Cold Lake), Eagle River Casino &Travel Plaza (Whitecourt), Grey Eagle Casino (Calgary), River Cree Resort and Casino (Edmonton) and Stoney Nakoda Casino (Kananaskis). All five First Nations casinos are governed by the Alberta Gaming and Liquor Commission under the guidelines of the First Nations Gaming Policy. First Nations casinos must be located on reserve land and operate Under the same rules as off-reserve casinos.

There are also twenty-three non-reservation casinos making a total of twenty-eight casinos currently operating in Alberta. Calgary has six casinos including one First Nation casino (Grey Eagle Casino). Edmonton has six casinos and one nearby First Nations casino (River Cree Resort Casino). Additionally, there are casinos in; Fort McMurray, Camrose, Lethbridge (2), Medicine Hat, Grande Prairie (2), Red Deer (2), Balzac, and St. Albert.

Demand for gambling depends on disposable income which is influenced by employment, taxes and interest rates. High gas prices can also adversely affect spending levels, particularly when someone must travel a distance to visit a casino. When consumer spending declines, discretionary expenses, such as gambling and travel, are among the first to be cut.

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According to several reports the gambling industry has struggled over the past five years due to an overall reduced demand for gambling. Canada is not the only country experiencing a slowdown in gambling; spending on games of chance has declined throughout the Western world over the past five years, following a sustained period of rapid growth. Furthermore, rising competition from new casinos and other gambling establishments in the United States has hurt the industry.

The industry has high and prohibitive barriers to entry. Each province differs in how it legislates and regulates gambling. Gaming organizations carry a range of regulatory forms which may be commercial, charitable, government owned, or owned by private companies under contract to provincial gaming authorities. As a result of this strict regulation, the number of industry establishments only grows when provincial authorities permit it to.

Alberta Gaming Liquor and Cannabis (AGLC) is responsible for the licensing, regulating and monitoring of gaming and liquor activities in Alberta. Casino gaming in Alberta is conducted and managed pursuant to the Criminal Code of Canada, the Gaming and Liquor Act, the Gaming and Liquor Regulation and the AGLC's Casino Terms & Conditions and Operating Guidelines (CTCOG).

“There is a moratorium on new casinos within the province. This moratorium has been in place since 2008 and was most recently reviewed by Alberta Gaming Liquor and Cannabis (AGLC) Board in 2015. At that time the Board of the AGLC extended the moratorium indefinitely.” “The Board of the AGLC wishes to ensure that any new casino or REC facilities will benefit the community and that the growth of gaming in Alberta is carefully managed and controlled to ensure that new gaming facilities will not adversely affect Alberta's gaming market and the charities serviced by that market.” Bob Arnett, Manager Emerging Gaming Products, Gaming and Cannabis with AGLC

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Casino’s are a point of destination and, as in the case of the Eagle River Casino just outside Whitecourt, a travel stop for drivers, heading north and south. A casino in the SGBP would be a major attraction to encourage drivers to make the turn into the park. Casinos normally offer restaurant and lounge services and often include a hotel, all desired industries for the SGBP.

Casinos also offer the opportunity for not-for-profits to work in order to generate funds for their organization. This is not permitted on First Nation Casinos which must be located on reserve. A casino in Sunrise Park, regardless of the ownership would not be a First Nations Casino, therefore would be eligible for not-for-profits.

A review of Alberta casinos shows that in northwest Alberta there are no casinos between Grande Prairie and the Northwest Territory border, a 700km stretch. This becomes a challenge for non-profits wishing to work a casino to generate funds for their organization. Further, people travelling south toward Edmonton via Highway 49, would not be able to access a casino until either the Eagle River Casino outside Whitecourt, or the casino is St. Albert.

The combination of travel time and cost for volunteers to go to Grande Prairie is further exacerbated by a three-year waiting list to work the Grande Prairie casino. In 2017 – 2018 charitable organizations shared $331 million in casino, raffle, bingos and pull tickets. The lack of a casino in northern Alberta greatly impacts our charitable and not-for-profits from accessing a fair share of these dollars. It should also be noted that First Nations have access to the First Nation Development Fund, which is funded by casinos on First Nation land. https://www.alberta.ca/first-nations-development-fund-grant-program.

Northern Sunrise County EDO Lynn Florence, along with Dan Dibbelt and the County’s Economic Development Committee Chair Norm Duval met with Sunrise Park landowners Romeo Lavoie and Marcel Ruel to discuss their property and their challenges in selling or developing their properties in the park. Marcel Ruel expressed interest in the Casino idea and was subsequently further pursuing this option.

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Despite a moratorium, this opportunity is worth pursuing. A casino in the SGBP would draw people off HWY 2. It would also provide food services. A business case outlining the need for a casino, and the benefits to northern not-for-profits to be able to work casinos in the region is worth pursuing. This would likely require considerable lobbying to succeed.

Also, despite the moratorium, the number of slot machines in the province has significantly since 2008 (moratorium year). In Edmonton, the River Cree Casino has expanded to include a new smoking permitted Casino, The Starlight Casino in the West Edmonton Mall has expanded, and the Baccarat Casino has been replaced by the larger Grand Villa Casino in the Ice District.

It should be noted that the Grand Villa Casino recently reduced it hours to Thursday to Sunday from 12 pm to 1 am due to slow business. This is attributed to a number of reasons, but primarily lack of parking in the district. Should Northern Sunrise County wish to pursue a casino, they would need to ensure they are in favor as a Council and need to then ensure it is a permitted development within SGBP.

A casino on the top of the East Hill could be an architectural jewel for the Peace Region, with exquisite landscaping, a fountain, and out-side eating areas it has the potential to be a very popular pull-over location.

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Section 7 Financial Mentoring Financing a new venture can be challenging. Traditional financial institutions have tightened their lending rules, particularly in northern and rural locations. While they remain a valid funding option, for those entrepreneurs with limited resources or collateral there are other options.

Futurpreneur Canada is a non-profit organization offering loan financing, mentoring and business resources for those aged between 18 and 39. http://www.futurpreneur.ca/en/landing-pages/general-landing- page/?tactus=ppc&gclid=CjwKCAjwvJvpBRAtEiwAjLuRPWXxDUUeTEy-XJpDRp3Lt0- IEYtYEz_-Sj789-hk1SoWALPuMke5BxoC_TUQAvD_BwE Services provided through Futurpreneur:

• Apply for up to $60,000 to launch or buy a new business or to grow one that’s been fully operating for less than 12 months.

• Get matched with an experienced mentor to help you build confidence and tackle your toughest challenges for up to two years.

• Learn key skills like business planning, marketing and cash flow management through our online and in-person business resources.

Agricultural Financial Services Corporation (AFSC) has supported, for more than 45 years, primary agricultural producers, commercial and agribusinesses in Alberta through its lending programs. Through partnerships with producers and businesses, AFSC helps maintain a profitable agriculture sector in the province and also healthy rural communities. Loan capital can be sourced directly by AFSC or through partnerships with other financial institutions. AFSC offers loans for agriculture, agribusiness and small business enterprises in Alberta.

• All AFSC lending products have a maximum lending limit of $15 million to an individual or any group of connected individuals or companies

• Long-term competitive interest rates, convenient repayment options

• Flexible terms, ability to lock in an interest rate for up to 20 years, and no pre-payment penalties

• The Rural Business Loan Program provides Alberta's small and medium-sized commercial and manufacturing businesses in rural Alberta with an alternative source of fixed-rate term loans with interest rates between 5% and7%.

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Community Futures Alberta The 27 Community Futures offices across Alberta offer loans and business development services that are purpose built for rural Alberta. The Peace River Community Futures Office serves Northern Sunrise County. Clients will be connected with a business analyst, get a loan application started, and access free business counselling and low-cost business coaching and training. Community Futures offices apply flexible loan criteria and options to help you start a new business, buy a business, open a franchise, expand into new markets, invest in technology, give your business a facelift and help young entrepreneurs get their first loan. Services include: Help with writing a business plan. Marketing plan or business expansion strategy. One-on-one coaching and business mentoring. Securing financing

Additionally, Northern Sunrise County should consider an entrepreneurial business plan grant. Attached as Appendix F is a suggestion for an entrepreneurial grant. The grant would award five local residents $2000 to work with the Peace River Community Futures on developing a business case. For new startups a business plan is essential. Additionally, a business plan is required when applying for financing.

Section 8 Cooperatives It can be difficult to convince an investor from outside the community to invest in a community when local residents won’t do likewise. And it can be difficult to convince local people to invest when the economy is slow. It is important to be prepared when someone walks into the County office looking for an opportunity to invest in the community. That doesn’t always happen and there are steps the County can take to try an encourage local investment.

Cooperatives are not a new concept in northern Alberta. Most residents have a “Coop number” which they use to shop for groceries and gas. Our region has seed coops, water coops and housing coops. According to the Government of Canada:

A co-operative is a legally incorporated corporation that is owned by an association of persons seeking to satisfy common needs such as access to products or services, sale of their products or services, or employment. While co-operatives serve a wide variety of functions, they generally fit one of the following four types:

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• A consumer co-op provides products or services to its members (such as a retail co-op, housing, financial, health-care or child-care co-op).

• A producer co-op processes and markets the goods or services produced by its members, and/or supplies products or services necessary to the members' professional activities (such as independent entrepreneurs, artisans, or farmers).

• A worker co-op provides employment for its members. In this type of co-op, the employees are the members and the owners of the enterprise.

• A multi-stakeholder co-op serves the needs of different stakeholder groups—such as employees, clients, and other interested individuals and organizations. This type of co-op is usually found in health, home care and other social enterprises. In Canada, a co-operative must incorporate under a specific co-operative Act at the provincial, territorial or federal level. These Acts govern all types of co-operatives, with the exception of financial co-operatives which are governed by separate legislation. The nature of the co- operative business model and how they operate is largely defined by these Acts. Whatever the governing Act may be, co-operatives share three common characteristics in areas of ownership, governance and distribution of profits.

Ownership: A co-operative is a business jointly owned by its members who use its products or services. In some cases, co-operatives can have members who do not use its services or products (e.g. support members, investor members). Governance: Co-operatives are democratically controlled businesses with the governing principle “one-member, one-vote”. This right is exercised at the co-operative's annual general meeting (AGM), where members can vote directly for the board of directors. This democratic governance structure is reinforced by the co-operative's by-laws and the legislation under which the co-operative is incorporated (provincial, territorial or federal). Distribution of Profits: Any surplus of a co-operative is owned by the member-owners who can decide how to distribute the profits at the AGM, which can include the following decisions: to allocate either part or all of the surplus to the general reserve for future investments; and ,to distribute the profits to all the members in the form of patronage dividends based on the individual member's usage of the co-operative over the past fiscal year. In addition, depending on the governing legislation, a co-operative may become a non-profit entity. These non-profit co-operatives do not provide members with a patronage dividend. All surpluses are directed eventually into the general reserve.

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Co-operatives First is a business development organization funded in full by the Co-operative Retailing System and Federated Co-operatives Limited. They focus on promoting and supporting business development based on the co-operative business model with the intent to increase rural and Indigenous economic development across western Canada. The organization helps community leaders understand the benefits and versatility of the co-operative business model by providing the mentorship and tools to create cooperatives. Cooperatives First offers Co-ops 101 which delivers an introduction to the co-op model. Operating a co-operative can be a little different than other business models and it’s important for volunteers, staff and boards to understand this difference. Co-operatives First provides basic training for those involved in a co-operative.

The co-operative business model is versatile and can succeed in any industry. Creating an investment coop would allow investors to review potential opportunities for SGBP, as well as other areas of the County.

DID YOU KNOW? – These Businesses Are CO-OPs

Associated Press Recognizable media companies, such as the New York Times, Torstar, and the Globe and Mail, are often part of large media co-operatives that provide a shared source of content that can be broadcasted in local markets. The Canadian Press in Canada, and the Associated Press in the United States of America, are co-operatively owned organizations that conduct investigative journalism, hold a global presence and share content with local broadcasters and media outlets. The use of these co-operatives ensures that smaller, local newspapers can access the same content as media giants. The Associated Press’ shareholders consist of over 1700 newspapers and over 5000 television and radio broadcasters. Home Hardware Each Home Hardware store is independently owned by a local entrepreneur. Each of the more than 1000 stores are shareholders in the larger Home Hardware co-operative that provides collective marketing and wholesale distribution. The co-operative, founded in the 1960s was led by Walter Hachborn to offer competitive prices to local stores at a time when hardware stores encountered challenging economic conditions. The access to high quality wholesale products at competitive prices has allowed the network of stores to gain a significant portion of the hardware market and is recognized as one of the industry’s leaders in Canada. Home Hardware’s brand has focused on its Canadian history and quality products rather than its co-operative business structure.

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Green Bay Packers Many professional sports teams maintain a very strong connection to their community and fans. In some cases, this is built into the business structure of the team when they organize as a co-operative. The most notable example of this is the Green Bay Packers, who are the only remaining community-owned non-profit team in the NFL. The Packers have over 360,000 shareholders and no single member can hold more than 4% of the over 5 million issued shares. This structure has allowed the team to remain functional despite being in the smallest market in all professional sports in America. Saskatchewan Roughriders Borrowing from the Packer model, the Saskatchewan Roughriders Football Club is also a co-operative with 2 share classes. The fan loyalty of these two clubs is legendary, and both the Riders and the Packers are top of class in their respective leagues for brand recognition and financial stability. Other professional sports teams in western Canada with a claim to being community-owned include the Winnipeg Blue Bombers and the Edmonton Eskimos.

Northern Sunrise County’ Economic Development Officer Lynn Florence has begun working with Nampa and Lac Cardinal Regional Economic Development to bring in a 2-hour workshop focused on how decisions are made, a co-op’s connection to its shareholders and other features of this business model. The workshop will include representatives from other Alberta CO-OPs to speak about their journey.

Section 9 Municipal Process and Procedures One of the most important things a municipality must do to encourage business development is be prepared. When a potential business arrives at the County office, the administration should be prepared with a complete package of material a business requires to move forward with their business application. If you are not prepared there are other municipalities out there that are. This includes not just businesses, but residential, as new industry also needs to consider the needs of their employees. Packages should be differentiated between business and residential.

Business & Residential Packages Commercial Property Inventory Residential Property Inventory LUB Relevant Zoning Types (For Business Packages) Utilities & Contacts Utility capacity CN Contacts (Business) Building Inspector Contacts List of Quality of Life Assets Banking & Business Directory (e.g. Schools, Medical, Recreation) Residential Property Taxes List of Residential Municipal Services Commercial Taxes / Licenses (Business)

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The County should also develop a visitation/follow up protocol for any new or potential businesses. One of the most common complaints from businesses is that communities work to attract them to their municipality and then once they settle in, no one from the municipality checks in to see how they are doing or if the municipality can assist them in anyway. Northern Sunrise County is excellent at follow-up and they should ensure this continues. Likewise, when a developer comes to the County, the administration should do follow up calls to see if the developer needs any additional information or assistance.

Targeted Marketing There are very few companies looking at expanding into northern Alberta, although there has been some interest from foreign investors, predominately China and India. Their interest has been in canola and peas and their interest is in value adding. The downturn in the economy, and the recent dispute between China and Canada has slowed this interest down substantially. How long this will last is uncertain. However, Northern Sunrise County should be prepared should the interest return. International investors are still shy about investing in Alberta’s north, however, utilizing the Government of Alberta’s international offices, opportunities still exist. The Government of Alberta has an international marketing team that works with municipalities and industry to encourage foreign investment in Canada. The website https://investalberta.ca/alberta-international-offices/ will provide substantial information on what these offices do, where they are located and how they can help. . Alberta Foreign Trade Offices Beijing Korea Singapore Guangzhou Mexico Taiwan Hong Kong New Dehli United Kingdom Japan Shanghai Washington

There are also funds available through the Canadian Agricultural Partnership program, a five- year, $3 billion federal-provincial-territorial investment in the agriculture, agri-food and agri- based products sector that began in April 2018 and is the successor of the 2013-18 Growing Forward 2 partnership. The programs offered are varied and many can assist with value-added products, research and innovation, and feasibility studies.

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Website and Townfolio As part of Northern Sunrise’s marketing, it is important to have an investor ready webpage linked on the main website. On that link economic development relevant data (basically everything included in the marketing package) should be included and designed for easy downloading and printing. Basic data such as census information, household income, dwelling units etc.… are also helpful for developers and investors looking at Rycroft. The cost both in both time and money to gather the information for inclusion on the website is very high. Townfolio (.https://jointownfolio.com/) provides this service for a yearly fee and updates your community profile from trusted and current data on a regular basis. Several Peace Region municipalities have secured the services of Townfolio and indicate it is well worth the money. A typical rural municipality would be charged a $3000 annual fee.

Section 10 Municipal Incentives

Northern Sunrise County may wish to weigh the option of creating incentives for the Park. Landowners in the Park had expressed challenges in attracting buyers for the properties because of the price. The lots are serviced which increase their price compared to unserviced lots elsewhere. Offering incentives in the Park may help in attracting buyers and bringing in the desired development the County wants.

Incentives have been explored and implemented by various municipalities. The intention is to attract growth. The negative is how to implement incentives without causing issues with existing industry that did not benefit from subsidies. Municipalities deal with incentives in different ways. Overall incentives do not always work, however, occasionally they can make a difference.

Assiniboia, Saskatchewan (https://www.assiniboia.net/)

The Town of Assiniboia , with a population of 2424 is located 175 km southeast of Regina. The Town is serviced by Highways 2 and 13. Their economic drivers are agriculture and some manufacturing. They offer six development incentives: • New Commercial and Industrial Construction • New commercial and industrial Expansion/addition • Manufacturing Business in Commercial and industrial zones • Main Street Revitalization • Public Art • New residential Construction.

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New Commercial and Industrial Construction A two-year tax abetment for new construction to assist in offsetting the costs of business start-up. • First year – 100% land and improvements • Second year – 50% of the amount of the increased assessment on improvements • Tax exemption includes both municipal and school levies on improvements only.

New Commercial and Industrial Expansion /Addition A two-year tax abatement for new construction that serves to increase the commercial assessment of the existing improvements on the land. This includes additions to an existing building, the replacement of an existing building or the addition of a new building. Interior alterations or renovations may qualify if they serve to increase the taxable assessment. • First year – 100% of the amount of increased assessment on improvements. • Second year – 50% of the amount of increased assessment on improvements. • Tax exemption includes both municipal and school levies on improvements only.

Manufacturing Business in Commercial and Industrial Zones To encourage manufacturing businesses to locate, operate and provide employment opportunities within the Town of Assiniboia, Council may negotiate and enter into an agreement on tax incentives that: • Includes abatement of both municipal and school division tax levies up to a maximum of five years. • Includes abatement of municipal tax levies in excess of five years.

Unity, Saskatchewan (https://www.townofunity.com/) The Town of Unity Saskatchewan is located at the intersection of Highway 14 and Highway 21, and the intersection of the CNR and CPR main rail lines. Unity is 200 km west-northwest of Saskatoon, Saskatchewan, and 375 km southeast of Edmonton, Alberta. The Town offers four incentives, three of which are residential. The Commercial and Industrial Incentive Policy provides support in the form of a 3-year phase-in of property tax on new construction and expansion to existing commercial and industrial properties in the Town of Unity. • No property tax shall be levied in the initial year of commercial or industrial construction, except for the land tax. • The Town of Unity is willing to negotiate with any prospective business enterprise the price of Town owned land and Town services such as water and sewer laterals, street improvements, building permits and property tax. • All new commercial and industrial developments commencing after January 1st, 2004 shall receive a three-year tax exemption of the assessments of expansion.

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• Construction materials should be purchased locally from business(es) situated within the municipal boundary of the Town of Unity. Prior to implementation of this policy and exemption of assessment, receipts for construction materials may be requested by the Town of unity for review. • A net increase in assessment greater than $25,000 due to new construction and/or renovations of a commercial and/or industrial development is required to be eligible for this policy.

Nipawin, Saskatchewan (http://www.nipawin.com/) The Town of Nipawin, Saskatchewan, population 5609 people is located on Highway 55 which connects the Manitoba Border to Meadow Lake and on Highway 35 to the US Border. Nipawin is situated on the Canadian Pacific Railway. Nipawin offers a New and Expanding business Incentive: • The tax exemption will be applied to any increased assessed value of an existing building due to new construction or renovation. • The tax exemption will also be applied to the assessed value of any expansion of new construction on bare land. • Exemption does not apply to the assessment of bare land. • Both municipal and education property taxes are to be exempt • The exemption shall be: o 100% exempt in years one through four o Full taxation in year five. • In lieu of a four-year tax exemption, a business may apply the estimated value of the municipal portion of the tax exemption to the municipal costs related to land purchase, or improving or installing municipal services, for example water and sewer, road upgrades, and paving.

Mundare, Alberta (https://www.mundare.ca/Business-Opportunity) Mundare, Alberta, 80 km east of Edmonton is offering commercial lots in the centre of Town for one dollar and a compelling business plan. The Town of Mundare is offering entrepreneurs a Main Street lot for one dollar on the condition that buyers obtain a development permit and begin construction within one year, with construction to be completed within one year of the start of construction. All lots have been sold and there is a waiting list should one of the buyers back out. The lots are zoned downtown commercial. The general purpose of this District is to allow commercial development appropriate for the downtown business district of the municipality,

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involving high-density development. The regulations do not allow uses which are obnoxious or involve excessive outside storage. Permitted Uses include: • Eating establishments, Office uses, Personal service shops, Retail stores, Manufacture or treatment of products essential to the retail business conducted on the premises provided that the floor space area used is not greater than 400sq.m (4306Sq.ft.), and such activity does not involve the use of hazardous chemicals or the killing of animals for meat. Suitable manufacturing uses including a bakery, the manufacture of candy, confectionary, ice cream or jam

Discretionary uses include: Alcohol retail sales Entertainment Parking lots Amusement establishments Service stations establishments Gas Bars Shopping centre Bowling alleys Hotels Theatres Childcare facilities Institutional uses Vehicle and equipment sales/rental Commercial schools Medical clinics Vehicle and equipment repair shops Drinking establishments Motels Veterinary services

Town of Bruderheim The Town of Bruderheim, population of 1155 is located just north of the junction of Highway 15 and Highway 45, approximately 47 km northeast of Edmonton. Bruderheim offers a Tax free for Three Year Policy. • The land on which the residence or business is situated will be assessed for taxation • The tax holiday will be calculated from January 1st following the start of construction. The tax holiday only applies to municipal property tax improvements. • If an existing home or business is demolished to accommodate the construction of a new residence or building, the taxes for the period of the year following the date of removal will be abated for the current year and the above noted tax holiday shall apply.

Village of Thorsbyhttps://www.thorsby.ca/ The Village of Thorsby, Alberta, population of 1015, is located 38 km west of the City of Leduc, along Highway 39. The Town offers the Commercial Development Incentive Policy: The purpose of this policy is to stimulate commercial expansion and new commercial development within the Village of Thorsby and to increase the long-term commercial assessment in Thorsby.

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New Business Construction The first year is the year in which construction begins. The business owner must own the land being developed and the tax relief is for the municipal portion only. The Village of Thorsby will provide a five-year development incentive for new business construction as follows: o First year – 100% land and building o Second year – 100% of land and building o Third year – 50% land and building o Fourth year – 50% of land and building o Fifth year – 25% land and building

New Business established in an Existing Building • First year – 50% land and building • Second and third year – 25% land and building

Business expansion Incentive • First to Third year inclusive – 50% incentive of incremental increase of improvement, assessment resulting from expansion

The Alberta Government is passing legislation (Bill 7) that will expand a municipalities ability to offer tax incentives to developers and business owners. The multi-year tax incentives will provide another tool to encourage economic development and provide more incentives for brownfield property redevelopment to revitalize communities. Bill 7 will allow municipalities to decide if, and how, to implement the tax incentives by passing a single bylaw that will:

• offer incentives to reduce, exempt or defer the collection of property taxes for non- residential properties for up to 15 years, with the option for renewal

• establish an eligibility criteria and application process to streamline tax incentive offers, instead of requiring a separate council resolution or bylaw for each property

(See Appendix G)

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Section 11 Summary Recommendations and Closing Comments Attracting businesses to your municipality is not an easy task in rural northern Alberta. Most businesses look to the larger centres where they will have a larger client base and greater foot and vehicle traffic. Many businesses try to locate next to large major retailers because their shoppers will see the smaller retailer and stop in to see what they have.

Rural urbans are also a challenge because many people in communities like Northern Sunrise County have the convenience of “popping” into Peace River or even Grande Prairie where the selection is greater, and the prices are often lower.

In order to move forward and make Northern Sunrise County a municipality of choice for developers, entrepreneurs and investors, the County should implement the following ideas:

1. Focus on three primary development opportunities: Opportunity #1 Restaurant/Café o Entrepreneur grant – see Appendix F o Investment coop Local ratepayers are more willing to invest in their own community; however, sometimes the cost can be forbidding. More information on coops can be sourced from Cooperatives First https://cooperativesfirst.com/.

The County’s Economic Development Officer is already in action setting up a Cooperatives First training workshop that will be open to the public.

o Entrepreneur Bootcamp – Again already running with ideas the County’s Economic Development Officer coordinated / and delivered this workshop during the course of building this report. (Appendix H)

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Opportunity #2 Speciality Foods / Products o Expanding on the restaurant/café model, this would attract a niche opportunity and expand the client base. Ideas include a bakery franchise, craft brewery or coffee roasting, and local products

Opportunity #3 Multi-purpose private venue – Hotel / Casino o NSC is presently working with County landowners and the Woodland Cree to further investigate this option

2. Look into development incentives New legislation amends the Municipal Government Act to allow municipalities to offer property tax incentives to non-residential properties to attract investment and development. Investment into hospitality industry developments is challenging due to lack of physical infrastructure and competition from urban centres.

3. Create economic development tab on website The County should consider an economic development tab and include info on commodity production, traffic counts, available properties, incentives, entrepreneurial grant, etc.…. Also include all information relevant to development process and contact lists for all service providers. Northern Sunrise County should also solicit a quote from Townfolio on providing statistical data, which they routinely update, for the webpage.

4. Implement an entrepreneur grant This grant would award five local residents $2000 to work with the Peace River Community Futures on developing a business case for their unique business. For new startups a business plan is essential. Additionally, a business plan is required when applying for financing. Allow the grant recipient one year to implement their business case at which point it would become property of Northern Sunrise County to pursue other options.

5. Research grants (https://cap.alberta.ca/CAP/ and develop a business case for a value- added agricultural commodity. In addition to the above support the province also offers the CARES grant (https://www.alberta.ca/community-regional-economic-support- program.aspx) for the development of business cases and strategic plans. The grant is a 50/50 cost shared grant. Northern Sunrise County, as a member of PREDA, can also apply for a PREDA Municipal Project Fund to leverage a portion of their 50 percent.

6. Assemble a developers/residential package When a developer or entrepreneur comes to the County office, they want service. As such packages should be created to simplify the development process. Packages should be differentiated between business and residential.

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Northern Sunrise County has several challenges in attracting hospitality/service industry developments into the SGBP, however, they are not unsurmountable. If the County considers a few actions to encourage development, they have the opportunity to duplicate the Gasoline Alley concept in Red Deer and create a loop drive through Sunrise park (Appendix I).

To do this, an anchor tenant, a business such as a hotel, a café, a bakery or a casino is needed to direct traffic into the loop. A niche business will benefit from the region’s population and the volume of traffic, obvious from the traffic counts.

The county may need to look at incentives, whether they be tax deferrals, or the development of business case for specific businesses, to incentivise entrepreneurs or franchises to consider the SGBP.

Lynn Florence, Northern Sunrise County’s Economic Development Officer was very active in participating in the creation of this report (research, surveys, Entrepreneur Bootcamp, Co-operatives First workshop for the Region!). She is also very involved with the business community at Sunrise Park. Continuing this relationship is crucial to identifying opportunities.

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Appendices

The following attachments are referenced within this report and included as part of the full reading of this report.

A Sunrise Gateway Business Park – Proposed Phase Development Map B Population Charts – By Gender and By Municipality C Peace Region - Retail Trade Profile D Traffic Schematic – 2018 Average Daily – HWY 2 & HWY 688 Alberta E Agriculture Exports F Request for Entrepreneurial Grant G Alberta New Municipal Tax Incentives H Entrepreneur Bootcamp - Agenda I Map of Gasoline Alley – Loop Concept

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(Back Cover)

Aylward Research Services 10128 95th Avenue Grande prairie, AB 780-527-6232 [email protected]

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NORTHERN SUNRISE COUNTY

SUNRISE GATEWAY BUSINESS PARK AREA STRUCTURE PLAN

SCHEDULE I: PHASING

Phase 1 Phase 2 Phase 3 Phase 4 Phase 5 GREENE VALLEY Phase 6 PROVINCIAL PARK * Phasing shall be determined based on landowner initiative, availability of services and market demand. Note: Lot boundaries are conceptual only. Æ 0 0.25 0.5 1 1.5

Kilometers

Mackenzie Municipal Services Agency Date: February 22, 2011 Page 120 of 272

Population - By Gender Nampa, Grimshaw, Peace River, Total Male Female Total Male Female Total Male Female Population; 2016 364 2718 6842 Population; 2011 362 2515 6729 Total private dwellings 176 1194 2970 Age Group 0 to 4 years 25 10 15 235 115 120 540 265 275 5 to 9 years 30 15 20 185 85 100 495 260 235 10 to 14 years 15 10 5 165 90 70 465 235 235 15 to 19 years 30 10 15 175 90 85 465 245 215 20 to 24 years 15 10 10 180 95 85 415 225 185 25 to 29 years 15 10 5 245 130 120 630 310 315 30 to 34 years 30 10 15 220 130 85 630 320 310 35 to 39 years 35 25 15 180 80 100 525 270 250 40 to 44 years 25 15 10 165 90 80 470 230 245 45 to 49 years 20 15 10 155 65 85 410 210 200 50 to 54 years 25 15 5 165 90 70 445 215 225 55 to 59 years 30 10 20 170 80 95 365 175 190 60 to 64 years 20 10 5 125 65 60 345 170 180 65 to 69 years 10 5 5 100 45 60 205 105 100 70 to 74 years 5 5 0 75 40 40 125 55 75 75 to 79 years 10 0 5 60 30 30 125 50 75 80 to 84 years 10 0 5 60 20 40 95 45 45 85 to 89 years 0 0 0 30 15 20 65 25 40 90 to 94 years 0 0 0 15 0 10 25 10 20 95 to 99 years 5 0 0 10 0 5 10 5 5 100 years + 0 0 0 0 0 0 0 0 0

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Population - By Gender Northern Sunrise Peace No. 135, Northern Lights Total Male Female Total Male Female Total Male Female Population; 2016 1891 1747 4200 Population; 2011 1791 1446 4117 Total private dwellings 798 639 1846 Age Groups 0 to 4 years 140 70 70 75 35 40 270 145 125 5 to 9 years 110 65 45 85 40 50 320 160 160 10 to 14 years 125 60 60 105 60 50 370 180 185 15 to 64 years 1290 690 600 1195 715 480 2655 1395 1260 15 to 19 years 140 85 55 135 75 60 290 155 135 20 to 24 years 115 60 55 120 85 35 200 105 90 25 to 29 years 80 40 35 105 70 35 210 95 110 30 to 34 years 120 65 60 120 85 30 240 125 115 35 to 39 years 120 55 65 85 50 30 230 120 115 40 to 44 years 105 65 45 115 60 55 265 135 130 45 to 49 years 125 70 55 120 65 55 280 135 140 50 to 54 years 165 95 75 145 80 65 360 195 165 55 to 59 years 150 65 75 145 75 60 315 175 135 60 to 64 years 170 90 80 115 70 45 270 145 125 65 to 69 years 85 50 35 90 50 40 240 125 110 70 to 74 years 75 40 40 60 30 30 170 100 75 75 to 79 years 45 25 20 55 25 35 105 60 45 80 to 84 years 15 10 10 45 30 15 50 30 20 85 years and over 10 5 10 30 15 10 15 10 10 85 to 89 years 10 5 5 20 10 10 15 10 5 90 to 94 years 0 0 0 10 5 5 0 0 0 95 to 99 years 5 0 0 0 5 0 0 0 0 100 years+ 5 0 5 0 0 0 0 0 0

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RETAIL MARKET OVERVIEW

& TRADE AREA PROFILES

SEPTEMBER 2016 Prepared by: Page 123 of 272

PREFACE

Cushing Terrell Architecture Inc. (“Cushing Terrell”) of Langley, BC was commissioned to prepare a Retail Market Overview & Trade Area Profile report for the Peace Region Economic Development Alliance (PREDA), consisting of community retail trade area profiles and drive time specific retail trade area profiles to analyze the retail market of the Peace Region.

The objective of this report is to document the current state of the retail market in the Peace Region, and identify trends and potentials for future retail development opportunities. Development trends impacting the retail industry and the potential for retail development in the Region were determined by profiling the respective trade areas of the following Municipal Districts (M.D.) and Counties:

- Big Lakes County - M.D. of Fairview - Birch Hills County - M.D. of Greenview - Clear Hills County - M.D. of Peace - County of Grande Prairie - M.D. of Smoky River - County of Northern Lights - M.D. of Spirit River & Saddle Hills County - Mackenzie County - Northern Sunrise County

Furthermore, drive-time specific retail trade area profiles were created for the following communities:

- Eaglesham - La Crete - Fairview - Manning - Falher, McLennan, & Donnelly - Nampa - Fox Creek - Peace River - Grimshaw - Sexsmith - High Level - Spirit River - High Prairie - Valleyview - Hythe - Worsley

The study was carried out over the period of February 2016 to August 2016, and entailed the undertaking of on-site fieldwork as well as supplemental research to gain a thorough understanding of the retail market in the Peace Region.

Reference material for this report was obtained from, but is not limited to: Peace Region Economic Development Alliance; the Towns of Sexsmith, Peace River, Falher, Fairview, Grimshaw, High Level, Spirit River, Fox Creek, Valleyview, High Prairie, and Hines Creek; the Villages of Rycroft, Hythe, and Berwyn; the Municipal Districts of Fairview, Spirit River, Peace, Greenview, and Smoky River; the Counties of Clear Hills, Birch Hills, Northern Lights, Northern Sunrise, Mackenzie, Grande Prairie, and Saddle Hills; Statistics Canada; Pitney Bowes; Alberta Community Profiles; and Cushing Terrell Architecture Inc.

Any tenant references made in the report are for illustrative purposes only and should not be taken as guarantees that they will locate in the Peace Region, but rather that they could represent compatible “target” retailers. This analysis was conducted by Cushing Terrell as an objective and independent party, and is not an agent of the Region by virtue of this, or any subsequent study to be conducted on this matter.

As is customary in an assignment of this type, neither our name nor the material submitted may be used without the expressed permission of PREDA or Cushing Terrell Architecture Inc.

-Cushing Terrell Architecture Inc. 2016

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Demographic Methodology Statement (Pitney Bowes January 2016) The data used in this document, as provided by Pitney Bowes, is adapted from Statistics Canada, Census Profile and Topic Based Tabulations, 2011, and National Household Survey Profile Data and Semi-Custom Data, 2011. Methodological information is extracted from Pitney Bowes’ Canadian Demographic Data January 2016 Product Guide. Pitney Bowes’ estimates and projections for Canada are updated annually. The reference date for the data is always July 1, which is considered the midpoint for the reference year. The reference date should be considered an annual midpoint and not, strictly speaking, the population number for a location on July 1. This methodology statement describes procedures used by Pitney Bowes and its team of demographers to produce the basic variable types including total population and population characteristics such as age and sex, as well as total households and household characteristics such as income and consumer expenditure potential. Processes are also in place to validate the data against independent sources and to assure data quality in terms of demographic, geographic, and mathematical consistency. Pitney Bowes’ demographers, geographers, and statisticians responsible for producing this data update have over 25 years of experience in producing demographic estimates and projections for the U.S. and Canada. The methodologies used to develop and update the Canadian demographic estimates and projections build on this expertise using a combination of traditional demographic techniques as well as innovative processes, which take advantage of proprietary resources. Pitney Bowes - Canada Estimates & Projections (E&P) Estimates and projections are available for July 1 2016, 2019, 2021, and 2026. Aggregate and average household income are available for 2016, 2019, and 2021. Household income distributions are now available for 2011 and 2016. Aggregate and average household expenditure for consumer goods and services is available for the current year only. The 2011 census information is used as the benchmark for the population and household estimates and projections in this release. In general and using National Household Survey (NHS) inputs, data are created at the smallest geographic level – dissemination area – then rolled up to all higher geographic levels via a set of correspondence tables. However, in order to assure consistency of small area estimates with higher level provincial and national estimates, the estimation and projection methodology involves a combination of top-down methods (national to census subdivision), using traditional demographic techniques, and bottom-up methods (dissemination area to census subdivision) using demographic techniques along with proprietary spatial modeling techniques. Significant efforts are applied to the task of integrating the latest Statistics Canada and Canada Post data into the Pitney Bowes demographic update process. Pitney Bowes - Canada Expenditure Potential (CanEx2016) The Pitney Bowes Expenditure Potential database provides dollar estimates of the amount of money spent annually, in aggregate, on detailed categories of consumer expenditures. The estimates are based on coefficients developed from the linkage of Statistics Canada’s Survey of Household Spending with Pitney Bowes’ PSYTE HD Canada segmentation system. The Canada Expenditure Potential database is developed using Statistics Canada’s Survey of Household Spending (SHS) and Pitney Bowes’ PSYTE HD Canada cluster system. The survey respondents are geocoded by Statistics Canada to their dissemination area (DA) of residence. Then, Statistics Canada aggregates and tabulates all SHS data by PSYTE HD Canada cluster. Coefficients are derived by Pitney Bowes such that, when applied against an independently derived estimate of aggregate household expenditures at the DA level, an estimate of detailed consumer expenditures is generated. Respondents to Statistics Canada’s SHS questionnaire recall amounts spent on several hundred consumer goods and services, during the previous calendar year. Several features of the survey assist the respondents in recalling their expenditures. Statistics Canada summarizes expenditure data of approximately 14,000 full-year households by PSYTE HD Canada cluster for detailed consumer expenditure variables based on reference material that Pitney Bowes has provided. Pitney Bowes analyzes these data to discern patterns and correlates to estimate missing values using a range of statistical methods. Expenditure estimates are modeled for small areas based on national Canada Expenditure Potential average household expenditure data (proportions) by PSYTE HD Canada cluster, and Pitney Bowes’ current household, income and expenditure estimates. Stats Canada & Visible Minorities The Employment Equity Act defines visible minorities as “persons, other than Aboriginal peoples, who are non-Caucasian in race or non-white in colour” (http://www12.statcan.gc.ca/nhs-enm/2011/ref/dict/pop127-eng.cfm). In Pitney Bowes’ reports, Aboriginal peoples are listed under Ethnic Origins rather than Visible Minorities. Due to the specific reports used in this study that do not includeEthnic Origins, Aboriginal peoples counts are not included, but can be approximately deduced by subtracting Total Visible Minorities from the Total Population Estimate.

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Retail Development Fundamentals Retail development, whether in smaller communities such as those found throughout the Peace Region, or larger markets like those on the fringe of a larger secondary/urban market like Grande Prairie, are driven by critical business fundamentals that must be acknowledged and considered when identifying retail opportunities. By way of a checklist, these include:

t Population characteristics of the consumer base; t The reality that retail follows consumers; t Consistent and high shopper traffic is a pre-requisite for most retailers; t The consumer base must demonstrate sufficient buying power to be of interest to retailers; t Chain retailers have a limited number of prototypical store formats that they are willing to operate. Deviating from these established formats is done only as a last resort in circumstances where demand for a location by a retailer or developer is high;

t Most retailers require sites with convenient access, high visibility, and ample parking; t Most retailers expand in well-defined geographic areas that coincide with their distribution networks and their familiarity with consumer preferences;

t Most retailers have established criteria for site selection. For example, Shoppers Drug Mart typically requires a population of 10,000 people in order to build a 15,000 sf store;

t The clustering of compatible retailers has become the norm; t Astute retailers will not accept “low rent” in compensation for an untested market; t Retailers cannot generally survive rent-to-sales ratios in excess of 15%. Retailers have a threshold level of sales they know they must achieve to be profitable; and

t Retailers attempt to maximize profitability by operating the fewest number of stores possible in any market to avoid sales transference.

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2.0 INTRODUCTION - PEACE REGION COMMUNITY TRADE AREA PROFILE

Cushing Terrell Architecture Inc. (“Cushing Terrell”) was selected by the Peace Region Economic Development Alliance (PREDA) to provide a Retail Market Overview for the Region and its various communities. This project entailed a documentation and review of the following specific locales and their current retail composition:

t Big Lakes County t Birch Hills County t Clear Hills County t County of Grande Prairie t County of Northern Lights t Mackenzie County t Municipal District of Fairview t Municipal District of Greenview t Municipal District of Peace t Municipal District of Smoky River t Municipal District of Spirit River & Saddle Hills County t Northern Sunrise County

Each of these areas has its own unique retail characteristics ranging from very localized to regional in trade area and consumer base. Accordingly, the purpose of this document will be to highlight the retail activity that is occurring both in the region and locally, as well as understanding the trends elsewhere that could shape future opportunities in the Region. Importantly, this information provides all of the essential market information that can help prospective new retailers as well as providing a platform of information that can be used in the creation of business plans for new business startups or entrepreneurs. 3.0 PEACE REGION RETAIL SNAPSHOT

The Peace Region is located in northwestern Alberta, over 400 kilometres and 4 hours away from Edmonton, and is largely open space with rural and urban development dispersed throughout the geographical area. Retail mainly takes the form of establishments located on the main streets of communities’ downtowns, and along major highways that pass through populated areas. Economically speaking, activities in the region are centred around agriculture, oil & gas, forestry, and tourism. The benefits of an economy oriented around various sectors is it allows for strength and resiliency in times of economic distress in a particular sector. The falling prices of oil are a present reality for many communities in Alberta including areas in the Peace Region, however that is not the sole force providing sustenance in the area.

Many busy highways pass through the Region, as well as railways and regional airports, creating a high level of connectivity with the surrounding area and beyond. Provincial Highways that connect the Region with other major centres in Alberta and British Columbia include Highways 2, 49, and 35. Having convenient access to transportation networks is a crucial requirement for many retailers, especially when considering predominantly rural areas such the Peace Region.

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The median age in the Region is 34.1 years, which is lower than the Provincial median of 36.7 years. Of the total Peace Region population, 26% is in the age bracket of 25-44, a cohort representing both the family building stage as well as the income earning stage. A young family demographic is an important pre- requisite for many retailers looking at entering a market or establishing another location in an existing market.

Another substantial age bracket is the 5-19 group, at 23% of the total population. Having a large youth population provides an “up and coming” demographic that has the potential to provide employment in the entry-level retail job sector, as well as adding to the overall vibrancy and diversity of a community. Preventing an out-migration of youth is a challenge many communities face, and can be mitigated through the provision of amenities, shops, and services that are attractive to a wide variety of age groups.

4.0 PEACE REGION RETAIL PROFILES

The following pages present a snapshot of the core retail communities within the Peace Region (excluding the City of Grande Prairie), providing a comprehensive analysis of their Retail Trade Areas and a framework for future growth, as well as retail opportunities.

The trade areas for each designated community have been created using 15-minute drive times to illustrate the most critical market segment: the Local Trade Area. The Town of Peace River was given a trade area of 30-minutes to portray the effect its larger and more substantial retail offerings has on the region. The drive time trade area for each community does not discount the ability for each respective area to draw from a much wider trade area given locational criteria such as being the only retail venue for an even greater distance. Additionally, drive times do not discount adjacent communities with retail offerings, and the effect this can have on shopping preferences for individuals.

Population data, current estimates, and forecasts are derived from Pitney Bowes data, and do not necessarily reflect the impact that potential Area Structure Plans or other development may have on population growth in the communities. Regardless, they are provided as a benchmark against which future demand can be quantified and gauged against, depending upon whether population change is faster or slower than forecasted.

PREDA | Alberta 8 Page 128 of 272

FIGURE 4.0 Peace Region Transportation Routes

PREDA | Alberta 9 Page 129 of 272

FIGURE 4.1 Peace Region County/Municipal Districts Map

Legend 1 - Mackenzie County 2 - County of Northern Lights 3 - Clear Hills County 4 - Northern Sunrise County 5 - Saddle Hills County 1 6 - M.D. of Fairview 7 - M.D. of Peace 8 - M.D. of Spirit River 9 - Birch Hills County 10 - M.D. of Smoky River 11 - Grande Prairie County No. 1 12 - Big Lakes County 13 - M.D. of Greenview 2

3 4

6 7 Peace River 5 8 9 10 12 11 BRITISH COLUMBIA 13 Alberta

Edmonton

Grande Prairie

PREDA | Alberta 10 Page 130 of 272 Peace Region peace region

(including all counties & towns, but excluding City of Grande Prairie)

Peace Region Population Estimate 2016: 112,828 | Population Forecast Estimate 2019: 111,919 Peace Region Population Growth 2016 - 2019: -0.8% Avg Household Income: $100,185 Avg Persons per Household: 2.8 Total Retail Spending (2016 est): $800 Million

Total Estimated Retail Inventory: 2.16 m sf (excl Beaverlodge & Clairmont) / 2.44 m sf (incl Beaverlodge & Clairmont) Total Estimated Retail Vacancy: 129,250 (6.0%)

Current Retail Space Per Capita Ratio: 19.2 sf / capita (excl Beaverlodge & Clairmont) / 21.7 sf / capita (incl Beaverlodge & Clairmont) TABLE 4.0 Peace Region Population Profile(incl Beaverlodge & Clairmont)

Peace Region Key Demographics Alberta Count % ϮϬϭϭĞŶƐƵƐ ϭϬϵ͕ϱϴϱ ϯ͕ϳϵϬ͕ϭϴϱ ϮϬϭϲWŽƉƵůĂƚŝŽŶƐƚŝŵĂƚĞ ϭϭϮ͕ϴϮϴ ϰ͕ϭϵϭ͕ϬϮϬ ϮϬϭϵWŽƉƵůĂƚŝŽŶWƌŽũĞĐƚŝŽŶ ϭϭϭ͕ϵϭϵ ϰ͕ϯϰϲ͕ϲϳϭ йWŽƉƵůĂƚŝŽŶŚĂŶŐĞ;ϮϬϭϭͲϭϲͿ ϯ͘Ϭй ϭϬ͘ϲй йWŽƉƵůĂƚŝŽŶŚĂŶŐĞ;ϮϬϭϲͲϭϵͿ ͲϬ͘ϴй ϯ͘ϳй POPULATION

ϮϬϭϲ,ŽƵƐĞŚŽůĚƐ ϯϵ͕Ϭϵϳ ϭ͕ϲϭϭ͕ϯϵϵ ŚĂŶŐĞŝŶ,ŽƵƐĞŚŽůĚƐ;ƉĞƌĐĞŶƚͿ ϮϬϭϭƚŽϮϬϭϲ ϯ͘ϭй ϭϭ͘ϲй ϮϬϭϲƚŽϮϬϭϵ Ϭ͘ϭй ϰ͘ϯй ϮϬϭϵƚŽϮϬϮϭ Ϭ͘Ϭй ϯ͘Ϯй ϮϬϮϭƚŽϮϬϮϲ ͲϬ͘ϭй ϳ͘ϱй WĞƌƐŽŶƐƉĞƌŚŽƵƐĞŚŽůĚ Ϯ͘ϵ Ϯ͘ϲ ϮϬϭϲdŽƚĂů,ŽƵƐĞŚŽůĚDĂŝŶƚĂŝŶĞƌƐ ϯϵ͕Ϭϵϳ ϭ͕ϲϭϭ͕ϯϵϵ hŶĚĞƌϮϱǇĞĂƌƐ Ϯ͕ϭϯϲ ϱй ϳϲ͕ϱϵϮ ϮϱƚŽϯϰǇĞĂƌƐ ϲ͕ϵϭϬ ϭϴй ϯϭϭ͕ϲϵϮ

HOUSEHOLDS ϯϱƚŽϰϰǇĞĂƌƐ ϳ͕ϲϵϯ ϮϬй ϯϯϯ͕ϳϭϱ ϰϱƚŽϱϰǇĞĂƌƐ ϴ͕ϰϴϱ ϮϮй ϯϮϮ͕ϮϮϬ ϱϱƚŽϲϰǇĞĂƌƐ ϳ͕ϰϱϰ ϭϵй Ϯϵϵ͕ϭϮϭ ϲϱƚŽϳϰǇĞĂƌƐ ϰ͕Ϯϳϯ ϭϭй ϭϲϯ͕ϳϬϴ ϳϱǇĞĂƌƐĂŶĚŽǀĞƌ Ϯ͕ϭϰϲ ϱй ϭϬϰ͕ϯϱϭ

ϮϬϭϲ&ĂŵŝůŝĞƐ ϯϮ͕ϰϲϯ ϭϵϯ͕ϳϮϭ DĂƌƌŝĞĚĐŽƵƉůĞƐ ϮϮ͕ϬϱϮ ϲϴй ϭϲϭ͕ϲϰϯ tŝƚŚŽƵƚĐŚŝůĚƌĞŶĂƚŚŽŵĞ ϵ͕ϵϮϴ ϯϭй ϭϭϳ͕ϱϰϴ tŝƚŚĐŚŝůĚƌĞŶĂƚŚŽŵĞ ϭϮ͕ϭϮϰ ϯϳй ϴϱ͕ϯϬϵ ŽŵŵŽŶͲůĂǁĐŽƵƉůĞƐ ϱ͕ϯϰϳ ϭϳй ϲϳ͕Ϭϰϳ tŝƚŚŽƵƚĐŚŝůĚƌĞŶĂƚŚŽŵĞ Ϯ͕ϯϴϴ ϳй ϵϱ͕ϵϰϯ tŝƚŚĐŚŝůĚƌĞŶĂƚŚŽŵĞ Ϯ͕ϵϲϬ ϵй ϵϬ͕ϳϮϯ FAMILIES >ŽŶĞͲƉĂƌĞŶƚĨĂŵŝůŝĞƐ ϱ͕Ϭϲϰ ϭϲй ϵϬ͕ϳϮϯ ǀĞƌĂŐĞWĞƌƐŽŶƐWĞƌ&ĂŵŝůǇ ϯ͘Ϭ Ϯ͘ϴ ǀĞƌĂŐĞŚŝůĚƌĞŶWĞƌ&ĂŵŝůǇ ϭ͘Ϯ ϭ͘Ϭ

PREDA | Alberta 11 Page 131 of 272 Peace Region peace region (including all counties & towns, but excluding City of Grande Prairie) TABLE 4.1 Peace Region Household Retail Expenditures (incl Beaverlodge & Clairmont)

Peace Region Key Demographics Alberta $ / HHld / Yr Grocery & Specialty Foods$7,502 $7,914 Full & Quick Service Restaurants$1,893 $2,352 Home & Personal Electronics & Appliances$2,781 $3,267 Personal Services$1,448 $1,649 Specialty Retail$1,027 $953 Home Improvement & Gardening$947 $793 Home Furnishings & Accessories$1,555 $2,064 Clothing & Apparel$2,230 $2,766 Footwear$691 $787 Jewelry & Accessories$338 $515 Pharmacy$1,018 $829 Health & Beauty$659 $755 Books & Multimedia$476 $589 Toys & Hobbies$341 $402 Sporting Goods & Recreation$377 $461 Entertainment & Leisure$1,191 $1,568 ANNUAL EXPENDITURES PER HOUSEHOLD Alcohol & Tobacco$1,942 $1,733 Auto Parts & Accessories$222 $162 Auto/RV/Motorsports Dealerships$5,937 $5,494

TABLE 4.2 - 25,000 50,000 75,000 100,000 125,000 150,000 175,000 200,000 225,000 250,000 Peace Region Estimated Retail Inventory 64,200 Summary by Category (excl Beaverlodge & Clairmont) 122,400

214,550 Existing Existing 66,374 Merchandise Category Inventory Inventory (SF) (%) -

8,800 Grocery & Specialty Foods 396,250 18.3% Alcohol & Tobacco 64,200 3.0% 33,350

Pharmacy 122,400 5.7% 23,300 Personal Services 214,550 9.9% Clothing & Apparel 66,374 3.1% 68,050 Footwear - 0.0% Jewelry & Accessories 8,800 0.4% Health & Beauty 33,350 1.5% 175,700

Home Electronics & Appliances 23,300 1.1% 3,500 Home Furnishings & Accessories 68,050 3.1% Home Improvement & Gardening 276,800 12.8% 2,600

General Merchandise 175,700 8.1% 36,400 Books & Multi-Media 3,500 0.2% Sporting Goods & Outdoor Recreation 2,600 0.1% 93,700

Toys & Hobbies 36,400 1.7% 114,450 Specialty Retail 93,700 4.3% Full Service F&B 114,450 5.3% 103,850

Limited Service F&B 103,850 4.8% 31,500 Entertainment & Leisure 31,500 1.5% Auto Parts & Accessories 85,000 3.9% 85,000

Auto/RV/Motorsports Dealership 112,700 5.2% 112,700 VACANT 129,250 6.0% TOTAL 2,162,724 100.0%

PREDA | Alberta 12 Page 132 of 272 Peace Region peace region

(including all counties & towns, but excluding City of Grande Prairie) TABLE 4.3 Peace Region Households Profile(incl Beaverlodge & Clairmont)

Peace Region Key Demographics Alberta Count % WĞƌƐŽŶƐƉĞƌŚŽƵƐĞŚŽůĚ Ϯ͘ϴ Ϯ͘ϱ

EƵŵďĞƌŽĨ,ŽƵƐĞŚŽůĚƐ ϯϵ͕Ϭϵϳ ϭ͕ϲϭϭ͕ϯϵϵ hŶĚĞƌΨϱ͕ϬϬϬ ϲϮϬ ϭ͘ϲй ϮϮ͕ϬϬϲ Ψϱ͕ϬϬϬƚŽϵ͕ϵϵϵ ϳϴϮ Ϯ͘Ϭй Ϯϲ͕ϱϵϲ ΨϭϬ͕ϬϬϬƚŽϭϰ͕ϵϵϵ ϭ͕ϭϵϳ ϯ͘ϭй ϯϵ͕ϳϰϴ Ψϭϱ͕ϬϬϬƚŽϭϵ͕ϵϵϵ ϭ͕ϳϱϲ ϰ͘ϱй ϱϴ͕ϴϯϮ ΨϮϬ͕ϬϬϬƚŽϮϵ͕ϵϵϵ Ϯ͕ϲϴϰ ϲ͘ϵй ϴϴ͕ϲϰϬ ΨϯϬ͕ϬϬϬͲϯϵ͕ϵϵϵ Ϯ͕ϴϲϮ ϳ͘ϯй ϵϰ͕ϳϮϬ ΨϰϬ͕ϬϬϬͲϰϵ͕ϵϵϵ Ϯ͕ϵϴϬ ϳ͘ϲй ϭϬϭ͕Ϭϳϴ ΨϱϬ͕ϬϬϬƚŽϱϵ͕ϵϵϵ Ϯ͕ϴϵϮ ϳ͘ϰй ϭϬϯ͕ϭϲϱ ΨϲϬ͕ϬϬϬͲϳϵ͕ϵϵϵ ϰ͕ϲϵϮ ϭϮ͘Ϭй ϭϳϯ͕Ϯϲϲ ΨϴϬ͕ϬϬϬͲϵϵ͕ϵϵϵ ϰ͕ϲϳϴ ϭϮ͘Ϭй ϭϴϮ͕ϭϯϳ ΨϭϬϬ͕ϬϬϬͲϭϮϰ͕ϵϵϵ ϰ͕ϯϵϬ ϭϭ͘Ϯй ϭϵϯ͕ϳϮϭ HOUSEHOLDS & HOUSEHOLDS

HOUSEHOLD INCOMEHOUSEHOLD ΨϭϮϱ͕ϬϬϬͲϭϰϵ͕ϵϵϵ ϯ͕Ϯϳϴ ϴ͘ϰй ϭϲϭ͕ϲϰϯ ΨϭϱϬ͕ϬϬϬͲϭϳϰ͕ϵϵϵ Ϯ͕ϭϴϱ ϱ͘ϲй ϭϭϳ͕ϱϰϴ Ψϭϳϱ͕ϬϬϬͲϭϵϵ͕ϵϵϵ ϭ͕ϰϲϳ ϯ͘ϴй ϴϱ͕ϯϬϵ ΨϮϬϬ͕ϬϬϬͲϮϰϵ͕ϵϵϵ ϵϴϰ Ϯ͘ϱй ϲϳ͕Ϭϰϳ ΨϮϱϬ͕ϬϬϬĂŶĚŽǀĞƌ ϭ͕ϲϱϭ ϰ͘Ϯй ϵϱ͕ϵϰϯ

DĞĚŝĂŶ,ŽƵƐĞŚŽůĚ/ŶĐŽŵĞ Ψϳϲ͕Ϭϵϱ ΨϵϬ͕ϳϮϯ ǀĞƌĂŐĞ,ŽƵƐĞŚŽůĚ/ŶĐŽŵĞ ΨϭϬϬ͕ϭϴϱ Ψϭϭϵ͕ϯϮϬ

dŽƚĂůsŝƐŝďůĞDŝŶŽƌŝƚǇWŽƉƵůĂƚŝŽŶ Ϯ͕ϯϰϳ Ϯ͘Ϭй ϳϲϱ͕ϲϱϴ ^ŽƵƚŚƐŝĂŶ ϰϴϮ Ϭ͘Ϭй ϭϵϯ͕ϴϭϬ ŚŝŶĞƐĞ ϭϱϳ Ϭ͘Ϭй ϭϳϬ͕ϬϴϬ ůĂĐŬ ϭϵϬ Ϭ͘Ϭй ϴϰ͕ϴϯϮ &ŝůŝƉŝŶŽ ϭ͕ϭϮϬ ϭ͘Ϭй ϭϮϵ͕ϭϮϮ >ĂƚŝŶŵĞƌŝĐĂŶ ϭϯϮ Ϭ͘Ϭй ϰϯ͕ϯϱϳ ƌĂď ϲϬ Ϭ͘Ϭй ϯϵ͕ϮϮϯ ^ŽƵƚŚĞĂƐƚƐŝĂŶ Ϭ Ϭ͘Ϭй ϰϱ͕ϰϴϰ tĞƐƚƐŝĂŶ Ϭ Ϭ͘Ϭй ϭϲ͕ϭϳϯ <ŽƌĞĂŶ ϭϭϯ Ϭ͘Ϭй ϭϲ͕Ϭϯϲ

VISIBLE MINORITIES :ĂƉĂŶĞƐĞ ϴϴ Ϭ͘Ϭй ϴ͕Ϯϵϲ sŝƐŝďůĞŵŝŶŽƌŝƚǇ͕Ŷ͘ŝ͘Ğ͘ Ϭ Ϭ͘Ϭй ϰ͕Ϭϯϳ DƵůƚŝƉůĞǀŝƐŝďůĞŵŝŶŽƌŝƚŝĞƐ ϱ Ϭ͘Ϭй ϭϱ͕ϮϬϴ

EŽƚĂǀŝƐŝďůĞŵŝŶŽƌŝƚǇ ϭϬϴ͕ϯϮϴ ϵϴ͘Ϭй ϯ͕ϯϰϭ͕ϮϬϱ

PREDA | Alberta 13 Page 133 of 272 Peace Region peace region (including all counties & towns, but excluding City of Grande Prairie) TABLE 4.4 Peace Region Labour Profile(incl Beaverlodge & Clairmont)

Peace Region Key Demographics Alberta Count % ŐĞϭϱнďǇ>ĂďŽƵƌ&ŽƌĐĞĐƚŝǀŝƚǇ ϴϮ͕ϴϮϬ ϯ͕ϯϯϴ͕Ϭϰϯ /ŶƚŚĞůĂďŽƵƌĨŽƌĐĞ ϱϱ͕ϴϰϵ ϲϳ͘ϰй Ϯ͕ϯϵϲ͕ϰϬϲ EŽƚŝŶƚŚĞůĂďŽƵƌĨŽƌĐĞ Ϯϲ͕ϵϳϮ ϯϮ͘ϲй ϵϰϭ͕ϲϯϳ WĂƌƚŝĐŝƉĂƚŝŽŶZĂƚĞ ϲϳ͘ϰй ϳϭ͘ϴй

>ĂďŽƵƌ&ŽƌĐĞďǇKĐĐƵƉĂƚŝŽŶ ϱϱ͕ϴϰϵ Ϯ͕ϯϵϲ͕ϰϬϲ DĂŶĂŐĞŵĞŶƚ ϵ͕ϰϲϴ ϭϳ͘Ϭй Ϯϳϭ͕ϵϱϵ ƵƐŝŶĞƐƐΘ&ŝŶĂŶĐĞ ϴ͕ϰϰϭ ϭϱ͘ϭй ϰϰϭ͕ϳϳϱ EĂƚƵƌĂů^ĐŝĞŶĐĞƐ ϴϮϰ ϭ͘ϱй ϭϳϳ͕ϯϵϱ ,ĞĂůƚŚ ϭ͕ϱϯϬ Ϯ͘ϳй ϭϬϲ͕ϭϬϯ ĚƵĐ͕'ŽǀΖƚ͕ΘZĞůŝŐŝŽŶ ϰ͕Ϭϴϭ ϳ͘ϯй ϮϮϭ͕ϬϬϰ OCCUPATIONS

LABOUR FORCE & ƌƚ͕ƵůƚƵƌĞ͕ZĞĐ͕Θ^ƉŽƌƚ ϭϬϮ Ϭ͘Ϯй ϭϯ͕ϭϵϵ ^ĂůĞƐΘ^ĞƌǀŝĐĞ ϵ͕ϯϰϵ ϭϲ͘ϳй ϱϴϬ͕ϴϯϮ dƌĂĚĞƐΘdƌĂŶƐƉŽƌƚĂƚŝŽŶ ϭϲ͕ϵϮϳ ϯϬ͘ϯй ϱϬϮ͕ϳϰϴ WƌŝŵĂƌǇ/ŶĚƵƐƚƌǇ ϯ͕ϲϮϱ ϲ͘ϱй ϰϯ͕ϰϭϰ WƌŽĐĞƐƐŝŶŐΘDĂŶƵĨĂĐƚƵƌŝŶŐ ϭ͕ϮϰϬ Ϯ͘Ϯй ϯϮ͕ϲϴϱ EŽƚƉƉůŝĐĂďůĞ Ϯϲϯ Ϭ͘ϱй ϱ͕ϮϵϮ

WƌŝǀĂƚĞǁĞůůŝŶŐƐďǇ^ƚƌƵĐƚƵƌĞdǇƉĞ ϯϵ͕Ϭϵϳ ϭ͕ϲϭϭ͕ϯϵϵ ^ŝŶŐůĞͲĚĞƚĂĐŚĞĚŚŽƵƐĞ Ϯϵ͕ϰϴϳ ϳϱ͘ϰй ϭ͕ϬϮϬ͕ϴϰϰ ^ĞŵŝͲĚĞƚĂĐŚĞĚŚŽƵƐĞ ϳϯϯ ϭ͘ϵй ϴϱ͕ϱϭϭ ZŽǁŚŽƵƐĞ ϴϳϭ Ϯ͘Ϯй ϭϭϯ͕ϵϳϳ ƉĂƌƚŵĞŶƚ͖фϱƐƚŽƌĞǇƐ ϭ͕ϰϵϯ ϯ͘ϴй ϮϮϴ͕ϴϵϵ ƉĂƌƚŵĞŶƚ͖ϱнƐƚŽƌĞǇƐ ϲϰ Ϭ͘Ϯй ϳϭ͕ϴϲϴ ƉĂƌƚŵĞŶƚ͖ĚƵƉůĞǆ ϭϲϯ Ϭ͘ϰй ϯϳ͕ϴϬϬ ^ŝŶŐůĞͲĂƚƚĂĐŚĞĚŚŽƵƐĞ ϱϯ Ϭ͘ϭй ϭ͕ϬϯϮ DŽǀĂďůĞĚǁĞůůŝŶŐ ϲ͕Ϯϯϯ ϭϱ͘ϵй ϱϭ͕ϰϲϴ HOUSING & HOUSING DWELLINGS

WƌŝǀĂƚĞǁĞůůŝŶŐƐďǇdĞŶƵƌĞ ϯϵ͕Ϭϵϳ ϭ͕ϲϭϭ͕ϯϵϵ KǁŶĞƌ ϯϬ͕ϭϭϳ ϳϳ͘Ϭй ϭ͕ϮϬϴ͕Ϯϰϭ ZĞŶƚĞƌ ϲ͕ϭϯϬ ϭϱ͘ϳй ϯϵϭ͕ϰϯϱ ĂŶĚŚŽƵƐŝŶŐ Ϯ͕ϴϰϵ ϳ͘ϯй ϭϭ͕ϳϮϯ

PREDA | Alberta 14 Page 134of272

EEE NR NT NL WL ST ER

TURNING MOVEMENT ABBREVIATIONS

NL: Traffic From North Turning Left

ER: Traffic From East Turning Right EEE E

WT: Traffic From West Proceeding Through

TURNING MOVEMENT ABBREVIATIONS c

c Page 135 of 272

$CA Percent Alberta 2017 Export Revenues – All Plant Products and Vegetables Sold to US All Countries $ 5,351,691,802 15.3% HS 1001 - Wheat $ 2,132,003,792 12.9% HS 120510 - Rape or Colza Seeds - Low Erucic Acid (Whether or Not Broken) $ 2,031,177,111 4.6% HS 0713 - Leguminous Vegetables - Dried and Shelled $ 307,083,320 16.0% HS 1107 - Malt $ 240,261,404 45.5% HS 1003 - Barley $ 197,042,331 13.0% HS 121490 - Swedes, Mangolds, Hay, Clover, Sainfoin, Forage Kale, Pellets $ 101,705,476 15.4% HS 0701 - Potatoes - Fresh or Chilled $ 44,289,804 100.0% HS 1104 - Cereal Grains - Hulled, Rolled, Flaked, Pearled, Sliced, Kibbled; Germ $ 37,557,091 71.9% HS 1201 - Soya Beans, Whether Broken $ 31,654,071 0.1% HS 120921 - Seeds of Forage Plants: Lucerne (Alfalfa) Seeds $ 30,895,336 94.3% HS 120923 - Seeds of Forage Plants: Fescue Seeds $ 29,403,984 89.9% HS 1004 - Oats $ 28,786,882 93.4% HS 1103 - Cereal Groats, Meal and Pellets $ 28,317,314 78.2% HS 1204 - Linseed $ 27,558,320 27.2% HS 1207 - Other Oil Seeds and Oleaginous Fruits $ 17,740,467 57.4% HS 120929 - Seeds of Forage Plants, Except Beet Seeds, For Sowing, Nes $ 12,171,913 67.9% HS 1302 - Vegetable Saps and Extracts; Pectic Substances; Agar-Agar $ 9,451,006 79.4% HS 1101 - Wheat or Meslin Flour $ 8,119,761 82.5% HS 1109 - Wheat Gluten, Whether Dried $ 6,982,483 100.0% HS 121410 - Lucerne (Alfalfa) Meal and Pellets $ 6,431,640 100.0% HS 0707 - Cucumbers and Gherkins - Fresh or Chilled $ 4,112,288 100.0% HS 1002 - Rye $ 3,491,857 94.4% HS 120590 - Rape or Colza Seeds - Other Nes (Whether or Not Broken) $ 3,328,293 82.0% HS 1211 - Plants Primarily in Pharmacy, Perfumery, Insecticides, Fungicides $ 2,462,164 20.4% HS 1108 - Starches (Inulin) $ 2,137,939 100.0% HS 0702 - Tomatoes - Fresh or Chilled $ 1,475,056 100.0% All Other Products $ 6,050,699 62.%

Page 136 of 272

Request for Decision or Allocation of Funds

Agenda item: NSC Entrepreneurial Business Case Grant

Request to Council: We are proposing a $10,000 grant (five grants of $2,000 each) to pay for mentoring and assistance in developing a business case for a business proposing to develop NSC.

Background: NSC is working on an economic development strategy in an effort to encourage development in the Sunrise Industrial Park. Through this process we have identified that developing local entrepreneurs to invest in our county is a valuable practice. Entrepreneurs can utilize the Community Futures for basic assistance to develop a business plan. However, often people give up because they don’t fully understand the process. Offering five $2,000 grants to pay towards a mentor for the business plan will help better prepare individuals to move forward with their business idea and better reflect the probability of success.

Considerations: The grant would only be for NSC residents for businesses proposed for NSC. NSC would hold an open competition and the economic development committee would review the applications and select the best five.

The grant agreement would be with Deb Kalen, (she is the business development officer at CF Peace River) she would be paid directly from NSC to ensure the process is followed. Any costs beyond the $2,000 would be at the entrepreneurs cost.

Risks

There may be applications from outside the County proposed for a business in the County, these would not be eligible. Another risk is someone may use the grant and develop a business elsewhere. Also, some may not move forward after going through the process.

NSC Board Decision: That the NSC Economic Development Board bring the NSC Entrepreneurial Grant to NSC Council for approval. Once approved, grant applications and process would be prepared and competition opened. Page 137 of 272 Property tax incentives For municipalities

Overview The proposed legislation amends the Municipal GovernmentAct (MGA)to allow municipalities to offer property tax incentives for non-residential properties to attract investment and development.

Municipalities in Alberta currently have very limited and specific authorities with respect to tax forgiveness. Councils can cancel, defer, or refund property taxes for specific properties in a specific year to provide relief to owners in cases of hardship.

The act also enables municipalities to provide multi-year tax incentives to encourage redevelopment of brownfiel d properties. Expanding these existing authorities to provide incentives for broader economic development purposes, and for durations of up to 15 years, willattract investment and provide longer-term certainty for businesses.

Summary of legislative components Proposed amendment Explanation Specifies that if land with an existing tax incentive is Provides certainty for property owners that any tax part of an annexation, the receiving municipality will incentive provided willremain in effect after an need to continue the exemption or deferral, subject to annexation, provided the property owner continues to the terms and conditions of the incentive approval. meet the necessary conditions.

Requires that tax incentives be included on the Provides public transparency regarding what assessment and tax rolls, and that corrections and properties received tax incentives, and ensures that amended notices are issued to reflect new tax assessed persons receive notice of changes resulting incentives. from new tax incentives.

This mirrors requirements that are already in place for other types of property tax exemptions.

Enables municipalities to, by bylaw, provide multi-year Streamlines the process for offering tax incentives by property tax incentives (full or partial exemptions, or allowing council to establish property tax incentives deferral of taxes) for non-residential properties for the through a single bylaw that creates parameters and purpose of encouraging development or revitalization criteria for tax incentives, rather than requiring a for the general benefit of the municipality. council resolution or bylaw for each individual property.

What does this legislation do to How is this different from what allow municipal tax incentives? municipalities can do now?, The proposed amendments to the Municipal The Municipal Government Act currently enables GovernmentAct willenable municipalities to offer councils to cancel or refund all or a portion of a multi-year tax exemptions, reductions or deferrals for property tax, or defer the collection of a tax in a non-residential properties, to attractinvestment, specific year for the purposes of providing tax relief development, and revitalization. Municipal councils in instances of hardship. The act also allows willbe able to pass bylaws establishing tax incentive municipalities to provide multi-year tax incentives to programs. Property owners, or prospective property encourage redevelopment of brownfield properties. owners, willapply to the municipality. This legislation willexpand the existing authority to include broader economic development purposes. What are the benefits? What about the municipalities Many municipalities are struggling to attract business and boost economic development and that already offer these types o revitalization. Tax incentives willlower the financial f burden on businesses, and willhelp municipalities attract investment. This legislation willhelp Alberta In rare circumstances, some Alberta municipalities municipalities create business investment climates may have used their existing tax cancellation, that can compete with other communities across reduction, and deferral authorities to offer incentive both Canada and the United States, where property programs. These municipalities may need to pass tax incentives are already available. new bylaws under the new legislation to ensure that their programs are in alignment. How do municipalities implement Can these incentives be used fo this? r Council willneed to pass a bylaw that outlines the existing businesses, or just new types of property tax incentives that willbe available development? in their municipality. The bylaw willdefine the types enabling, and leaves that of development and revitalization that willbe eligible The proposed legislation is to receive these incentives, the criteria and to local councils. conditions for approval, and willoutline the application process. Property owners willthen apply to the municipality to receive the incentive.

Pick your Location: Grimshaw Business Center May 21 and May 22 St. Isadore Cultural Center May 22 and May 23 Rycroft Memorial Community Hall May 23 and May 24

Entrepreneur Bootcamp Day 1 9:00AM – 3:30PM Owning a Small Business: A variety of local Peace Country business owners talk about why they started their businesses and share a few words of wisdom as you embark on this two-day entrepreneurial bootcamp. Starting a Franchise? Presenter: Franchise Owner / Operator - Peace Region No stranger to long hours, this franchise owner will talk about experiences in franchising - How franchise investors determine location, franchise costs, marketing, recruiting, training, and much more! Population Profiles, Traffic Counts, and Market Surveying Presenter: Mary Joan Aylward – Peace Region Economic Development Alliance (PREDA) Specializing in the Peace Country demographics and survey design, Mary Joan will show you how to analyze your local population profiles and local traffic counts and how to use this information in your business plans and future customer projections. Mary Joan will also present the “does and don’ts” of survey design and go live on the most commonly used survey software for small businesses and preview the technical aspects available. Local Retail Consumer Gaps? Presenter: Kieron Hunt –Key Planning Strategies Key Planning Strategies has a specialized focus on downtown & main street revitalization. In 2017 Kieron created a detailed inventory of the retail stores and vacant retail land in the Peace Country. The information he has collected is extremely valuable for new business planning and is always looked for by site locators for franchisers and investors. In his presentation Kieron will explain the data collected for your community and how to use this information in your business planning. Event Host Recap – Entrepreneurial Bootcamp - Day 1 Day 2 9:00AM – 3:30PM What is a Business Plan? Do I need one? Presenters: Randy Hodgkinson and Deb Kalyn - Community Futures of Peace Country For over 30 years, Community Futures has been helping people just like you turn business ideas into reality in the Peace Country. With a team of small business specialists ready to help you with planning, finances, training, and follow-up supports, Community Futures offers everything you need to know about starting or buying a business. Within the framework of a Business Plan, Randy and Deb will introduce you to very important business operations such as Workman’s Compensation, Business Insurance, Licensing, Employee Benefits, Development Permits, Financial Statements, and Taxes related to your business. Human Resources and Small Business Ownership Presenter: Stacey Messner – Human Resource Consultant Founded in 2016, Stacey provides private consultation service services to small businesses in the Peace Region. Whether its employment contracts, performance reports, or employee motivation; Stacey provides expert advise on these topics not only from a common sense approach but also highlights when labour law dictates what you are required to do. Small Business Loans Presenter: Randy Hodgkinson and Deb Kalyn - Community Futures of Peace Country More knowledge from our local Community Futures experts! Community Futures provides a variety of customized, affordable loan options for small business owners and entrepreneurs in rural Alberta, ranging from $500 to $150,000. Traditional Banks - Financing a Business Many traditional banks now offer speciality services and loans for small businesses. In this session a local bank will explain what is generally offered at most banks and highlight the offering from their bank in particular. Event Host Recap of Day 1 and Day 2 So let’s start your business! Next Steps.

Registration Fee: $25.00 Pay on-line OR Cash at the Door Lunch Included!

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Page 143 of 272

Gasoline Alley West

During construction, access to Gasoline Alley West will be maintained via Leva Avenue from McKenzie Road and Highway 2 from the south, and via Taylor Drive and England Way from the north. Currently there are no detours in place for this area.

Once complete, a new collector-distributor road system (similar to a service road) will allow drivers to access Gasoline Alley via Gaetz Avenue, Taylor Drive and Highway 2. Business Access

Access to the following businesses is currently maintained through McKenzie Road from Highway 2 and Lantern Street from Red Deer.

Esso A & W Shell Husky Tim Horton's Wendy's Smitty's Carpet Superstores KFC Mac James Motors Peter's Drive-In Fas Gas Hampton Inn & Suites McDonald's The Donut Mill Microtel Starbucks Ashley's Furniture Warehouse Carl's Jr. Motel Western Budget Home Church Trail Appliances Cam Clark Ford Red Deer Westridge Cabinets Toyota The Hideout Sunset Grill Boston Pizza Canadian Closet Wolverine Guns & Tackle Subway SML Games & Hot Tubs Dollarama Airsoft Shop (buyairsoft.ca) Galaxy (Cineplex) Staples Costco Booster Juice Hot Stuff Foods Press'd Mobil Lube Express Page 144 of 272

Career High School Princess Auto Master Rim's Taekwando Turple Bros Ricky's Proform Kennedy's Parable Legacy Monuments K Club Salon Spa & Permanent Makeup Humpty's Gary Moe Volkswagon The Liquor Hutch Synik Clothing Co The Source Snowboard and Skateboards Leon's Furniture OPA Pita Pit The Chopped Leaf Edo Japan Glenn's Restaurant & Gift Shop

Page 145 of 272

-----Original Message----- From: David Leblanc Sent: October 16, 2019 10:13 AM To: Cindy Millar Cc: Jocelyn Gagnon Subject: RE: Protective Services Christmas Dinner

Hi Jocelyn Please add an invite to council and CAO to the fire departments Awards banquet on Dec 6th 6:00 drinks dinner at 6:30 at the St. Isidore Community hall upstairs thank you.

Page 146 of 272

J] Peace River School Division

LegislativeServlg Planning 8-Dvpmt ProtectiveServices October 7, 2019 PublicWorks , Boa rd of Trustees 031% Chairman Darren Kuester Reeve Carolyn Kolebaba Northern Sunrise County Vice Chairman Delainah Veliehka Bag 1300 Peace River AB. Trustees Christopher Schneider T83 1Y9 Crystal Owens Lori Leitch Robyn Robertson Dear Reeve Kolebaba:

Superintendent of Schools Paul Bennett Re: Joint Meeting with the Peace River School Division Board of Trustees

Assistant Superintendent of Human Resources The Peace River School Division (PRSD) Board of Trustees invites your council Adam Murray and CAO to a joint meeting with other municipal and town councils within our on Assistant Superintendent of division. The meeting will be held February 4, 2020 at 7:00 p.m., at the PRSD

Learning Supports Central Operations located at 4702 — 51 St. in Grimshaw, AB. Aleeta Ploc

Assistant Superintendent of We encourage and welcome any agenda items brought forward by your council. Teaching & Learning Jeff Thompson Please forward confirmation of your council’s attendance, number of attendees and any agenda items to Executive Assistant Chris Wame by email Secretary-Treasurer Rhonda Freeman [email protected] or phone (780)624-3650 x 10140 by January 9, 2020.

Our board looks forward to meeting with our municipal and town councils to discuss how we can work together to create opportunities for youth in our communities.

Sincerely,

Darren Kuester Board Chair

cc. CAO Cindy Millar

.3./_ / Peace RiverschooiDivision 4702 - 51 Street PO Box 38'.) Grimshaw AB T0H M/G T 780.624.3601 F 7803321050 www.prsd.ab.ca \ Public Schools Alberta‘; rtmcnoke Learning Together - Success for All Page 147 of 272

From: Tasha Blumenthal Date: October 21, 2019 at 12:26:57 PM MDT Cc: RMA Board Dist , Policy Analysts Subject: RMA Member Conference Call October 25 - Provincial Budget

RMA Mayors, Reeves and CAOs,

We will be hosting a member town hall on Friday, October 25 from 1:00 – 2:00 pm to highlight key items of municipal and rural interest in the provincial budget that is being released this Thursday.

Conference Call Details: Call Number (647) 558-0588 Meeting ID: 999 839 787

Please share this information with your councils. To maximize this discussion, we are requesting that one spokesperson per municipality be designated in advance of the call.

Our staff will be working late to run through budget documents and prepare an analysis for our members, which we will share with this you by Friday morning at the latest. We will include this information in Contact as well next week, so if you aren’t able to make the call, please refer to the e- newsletter for our analysis.

For more information on the provincial budget, please visit the Government of Alberta’s website.

Regards,

Tasha Blumenthal, MBA Director of External Relations & Advocacy

Office: 780.955.4094 Cell: 780.716.5190 RMAlberta.com 2510 Sparrow Drive, Nisku, Alberta T9E 8N5 780.955.3639

This email and any files transmitted with it are confidential and intended solely for the use of the individual or entity to whom they are addressed. If you have received this email in error, please notify the system manager. Please note that any views or opinions presented in this email are solely those of the author and do not necessarily represent those of the organization. The sender does not accept liability for any errors or omissions in the contents of this message which arise as a result of virus/malware infection or email transmission errors.

Page 148 of 272

MINUTES NORTHERN SUNRISE COUNTY GOVERNANCE & PRIORITIES COMMITTEE MEETING October 8, 2019 NORTHERN SUNRISE COUNTY COUNCIL CHAMBER 1:00 PM

PRESENT: Carolyn Kolebaba Reeve Norm Duval Deputy Reeve Dan Boisvert Councillor Audrey Gall Councillor Gaylene Whitehead Councillor Corinna Williams Councillor

IN ATTENDANCE: Cindy Millar Chief Administrative Officer Olive Toews Director of Legislative Services Jocelyn Gagnon Executive Assistant Ian Cosh Director of Engineering Mike Konowalyk Director of Public Works Amber Houle Supervisor of Community Services Lynn Florence Economic Development Officer Jennifer Regal Development Officer Keagan Andrew Municipal Intern

1. CALL THE MEETING TO ORDER

Reeve Kolebaba called the meeting to order at 2:50 p.m.

2. ADOPTION OF THE AGENDA

3. NEW BUSINESS

3.1 Drainage Program Update

Council had a general discussion regarding priorities for County Drainage Program. Council agreed to the following projects to be added to the drainage program budget for review at the upcoming budget meetings: • Drainage line at the south end of the hamlet of Marie Reine • Range Road 204 between Township Road 830 and Highway 688 • Drainage repair on Township Road 840 near Gunning Road. • Drainage concern at the south end of the County near the MD of Smoky River on Highway 744

3.2 Internal Red Tape Reduction Discussion - Development Permits added by Councillor Boisvert

Council had a general discussion about internal red tape reduction. It was noted that the service level review that will happen in 2020 may identify some of the internal red tape.

3.3 Rural Road Study Tables

Council had a general discussion regarding the County paved and gravel rural road study tables. Council requested that the Dairy Barn Road, RR 204 be removed from the paved road table.

3.4 Outdoor Recreation in Northern Sunrise County Page 149 of 272

NORTHERN SUNRISE COUNTY GOVERNANCE & PRIORITIES COMMITTEE NOTES October 8, 2019 Page 2 of 2

Council had a general discussion regarding the marketing options for the County's outdoor recreation opportunities. Council requested that the outdoor rink and ball diamond at McKinney Hall be removed from the inventory list. Council requested the following marketing options: • Card Racks • Mighty Peace Tourist Association GIS Mapping • Move Up Magazine Ads

4. ADJOURNMENT

Reeve Kolebaba adjourned the meeting at 4:17 p.m.

Page 150 of 272

From: [email protected] Sent: October-09-19 12:37 PM To: general Subject: Renewable Energy Projects Survey for Council

To whom it may concern,

We are contacting you on behalf of a research project at the University of Alberta that is examining the decision-making factors of renewable energy projects in Albertan municipalities. Part of this study surveys Albertan mayors and councillors about their opinions on municipal renewable energy projects. If possible, could you kindly forward this message to the mayor and councillors of Northern Sunrise County.

If you are willing to participate in this survey, we will be asking you questions about existing renewable projects, your inclination for renewable energy development, and some of the opportunities and barriers you may be facing. Your responses will help us develop a better understanding of the demand for renewable energy at the municipal scale. Our research is supported by the Rural Municipalities of Alberta, Municipal Climate Change Action Centre, and the Federation of Canadian Municipalities and will be used to develop resources for municipalities interested in community energy. Please note that we are interested in your responses even if your municipality does not have or is not planning on developing a renewable energy project.

By completing the survey, you will have an opportunity to win one of two gift cards valued $350 dollars. The odds of winning this survey will depend on the number of responses we get, but the approximate odds are about 1/350.

Please be assured that your responses will be completely confidential. We will ask for your official title in the municipality and the name of your municipality, but this information will be aggregated in any publications and presentations. The individual responses will only be seen by the research team.

This survey will be done online and your responses will be recorded digitally. Please take the time to read all the questions and answer them as best as possible. The survey will take about 25 minutes to complete.

Please find a link to the survey here: https://survey.ca1.qualtrics.com/jfe/form/SV_b7x6YWuk3LIcNIp

Thank you again for your time and participation. If you have any questions regarding this survey, please consult the information sheet at the start of the survey or contact Sonak Patel at [email protected].

Sincerely,

Measuring the Costs and Benefits of Energy Transitions Team University of Alberta, Future Energy Systems https://www.futureenergysystems.ca/ Page 151 of 272

Request for Decision Council - 22 Oct 2019

Topic: Bylaw B364/19 Regional Assessment Review Board Bylaw

Administrative Recommendation: That Council give first and second reading to Bylaw B364/19 Regional Assessment Review Board Bylaw; AND THAT Council direct Administration to bring Bylaw B364/19 Regional Assessment Review Board Bylaw back to Council for third reading on November 19, 2019.

Background: The Municipal Accountability Program Review Report identified areas where Northern Sunrise County did not meet legislative requirements. The revised Regional Assessment Review Board Bylaw has made the changes recommended by Municipal Affairs to ensure that Northern Sunrise County complies with all relevant provincial legislation.

Administration has provided the draft bylaw to the participating municipalities to be consistent with the legislative requirements. The participating municipalities are Clear Hills County, Village of Hines Creek, Village of Nampa and the Town of Peace River.

IMPLICATION OF DECISION

Financial Implications: None

Policy and/or Legislative Implications: 1. Bylaw B171/10 Regional Assessment Review Board Bylaw

Public Consultation Required: None

Attachments: 1. Draft Bylaw B364/19 Regional Assessment Review Board Bylaw 2. Bylaw B171/10 Regional Assessment Review Board Bylaw 3. Assessment Review Board Joint Regional Agreement

Alternative Options: 1. Council could defeat Bylaw B364/19 Regional Assessment Review Board Bylaw at first reading. 2. Council could direct Administration to bring back additional information before giving first reading to Bylaw B364/19 Regional Assessment Review Board Bylaw.

REVIEWED AND APPROVED FOR SUBMISSION TO COUNCIL

Page 152 of 272

Page 2 of 15 Department Manager: Date: October 16, 2019 Olive Toews Chief Administrative Date: October 16, 2019 Officer: Cindy Millar

Page 153 of 272

Page 3 of 15

NORTHERN SUNRISE COUNTY

BYLAW NO. B171/10B364/19

Being a bylaw of Northern Sunrise County, in the Province of Alberta, to establish Regional Assessment Review Boards.

WHEREAS, the Municipal Government Act, S.A. Chapter M-26, as amended, requires the establishment of Assessment Review Boards; and

WHEREAS, Section 456 of the Municipal Government Act, S.A. Chapter M-26, as amended, permits two or more Councils to jointly establish Assessment Review Boards to have jurisdiction in their respective municipalities;

NOW THEREFORE the Council of Northern Sunrise County, in the Province of Alberta duly assembled enacts as follows:

1. Title

1.1. This Bylaw shall be known as the “Regional Assessment Review Board Bylaw”

2. Definitions

2.1. In this Bylaw: a) “Board” means the Regional Assessment Review Board; b) “CARB” means the Composite Assessment Review Board established in accordance with the “Matters Relating to Assessment Complaints” Regulation; c) “Designated Officer” means the designated Clerk of the Assessment Review Board as delegated by Council. d) “LARB” means the Local Assessment Review Board established in accordance with the “Matters Relating to Assessment Complaints” Regulation; e) “Member” means a member of the Regional Assessment Review Board; f) “Regional Partner Municipality” means those municipalities who enter into a Board Regional Joint Agreement with Northern Sunrise County to jointly establish a Regional Assessment Review Board and who enact a bylaw substantially in the form of this bylaw; g) “Regional Pool” means a group of Assessment Review Board members duly appointed by the Councils of Regional Partner Municipalities, who meet the training requirements of the Municipal Government Act

3. Assessment Review Boards

3.1. Council hereby establishes the Local Assessment Review Board (LARB). 3.2. Council hereby establishes the Composite Assessment Review Board (CARB).

3.4.Membership

3.1.4.1. Members shall be appointed to the Regional Pool by the Councils of the Regional Partner Municipalities by resolution of Council. 3.2.4.2. Membership terms will be no longer than three (3) years and will be made in such a manner that the expiry dates of members are staggered. 3.3.4.3. Members may apply for reappointment to the Regional Pool. 3.4.4.4. All membership vacancies shall be advertised to request formal submission of applications. 3.5.4.5. Appointments of members shall be made from those applicants responding on a timely basis to the advertised need. 3.6.4.6. Appointments to be made through a show of hands by Council with the candidate, or candidates, receiving the highest number of votes being appointed by resolution of Council if the majority of Council voted in favour of that candidate. 3.7.4.7. There will be no automatic succession appointments. 3.8.4.8. Council deems that a member appointed to the Regional Pool by a Regional Partnership Municipality is a member appointed by Council.

1 Page 154 of 272

Page 4 of 15

3.9.4.9. Council delegates the authority to the Assessment Review Board Clerk to assign a Board from the Regional Pool, as required. 4.10. Members shall be compensated to sit at a hearing as set out in the Schedule “A” ofof Fees attached to this Bylaw. 3.10.4.11. Members must successfully complete a training program set or approved by the Minister as specified in the Regulations.

4.5.Panels of the Board

4.1.5.1. The Board shall sit in panels to hear assessment complaints as the nature of the complaint may permit or require, such panels to consist of: a) One Board of three members, selected by the designated officer when the Board is acting as a LARB b) One Board of three members, selected by the designated officer when the Board is acting as a CARB c) A single member Board selected by the Designated Officer when the Board is acting as a Single Member CARB or a Single Member LARB as required. 4.2.5.2. The Designated Officer may select any Board from the Regional Pool, provided that a Municipal Government Board member sits on a CARB

5.6.Chairperson

5.1.6.1. The Board shall designate one member to be Chairperson of each Board with the powers and duties prescribed within the MGA, provided however that: a) The provincial member must be the Chairperson of a panel sitting as the Composite Assessment Review Board; and b) The Provincial member must be the sole member of a panel sitting as a Single Member Composite Assessment Review Board. c) Where possible, the Designated Officer shall include on a three (3) person panel a member who is from the municipality under whose jurisdiction the complaint arises. d) The Chairperson of a panel: i. Will preside over and be responsible for the conduct of meetings; ii. May limit a submission if it is determined to be repetitious or in any manner inappropriate; and iii. Will vote on matters submitted to the Board unless otherwise disqualified.

6.7.Jurisdiction of the Board

6.1.7.1. The Board shall have jurisdiction to exercise the functions of a LARB and the functions of a CARB under the provisions of the Municipal Government Act in respect of assessment complaints made by an assessed person of a Regional Partner Municipality.

7.8.Designated Officer of the Assessment Review Board

8.1. The position of a Designated Officer of the Assessment Review Board is hereby established. 7.1.8.2. Council hereby appoints the Director of Legislative Services as the Designated Officer in the position of Clerk of the Assessment Review Boards. Duties and responsibilities are outlined in the Municipal Government Act, Part 11, Assessment Review Boards, and the “Matters Relating to Assessment Complaints” Regulation. 7.2.8.3. In the event the Designated Officers is unable to perform the duties of the Clerk, Council hereby authorizes the Chief Administrative Officer to appoint a qualified Clerk from a Regional Partner Municipality.

8.9.Complaint Fees

8.1.9.1. Complaint Fees are set out in the Schedule “B”of Fees attached to this Bylaw.

9.10. General Matters

2 Page 155 of 272

Page 5 of 15

9.1.10.1. Those portions of Bylaw No. B022/95 referring to an assessment appeal board, and any amendments thereto, areBylaw No. B171/10 is hereby rescinded in their its entirety.

READ a first time this ____ day of _____, 20102019

READ a second time this ____ day of ______, 20102019

READ a third time this ____ day of ______, 20102019

______Reeve Chief Administrative Officer

3 Page 156 of 272

Page 6 of 15

Northern Sunrise County Bylaw No. B171/10B364/19 – “Regional Assessment Review Board” SCHEDULE “A”OF FEES

1. Remuneration for all Assessment Board members participating in the hearing Hearing shall be as follows: 1.1. Chair • $155 up to 4 hours • $255 for 4 hours up to 8 hours • $455 for over 8 hours

1.2. Member • $100 up to 4 hours • $200 for 4 hours up to 8 hours • $400 for over 8 hours

2. Travel and Subsistence shall be compensated at the rate of the municipality convening the Hearing.

3. Remuneration for all Assessment Board clerks participating in the Hearing shall be as follows (Note: the remuneration is payable to the Municipality that employs the Clerk, unless the Clerk is an employee of the Municipality from which the Hearing originated, in which case no remuneration is payable): • $750 per hearing

4. Complaint fees are set as follows: 4.1. Residential/Farmland Appeals - $25.00 per parcel 4.2. Commercial/Industrial Appeals - $100.00 per parcel

4 Page 157 of 272

Page 7 of 15

Northern Sunrise County Bylaw No. B171/10B364/19 – “Regional Assessment Review Board” SCHEDULE “B”

4. Complaint fees are set as follows: 4.1. Residential/Farmland Appeals - $25.00 per parcel 4.2. Commercial/Industrial Appeals - $100.00 per parcel

5 Page 158 of 272

Page 8 of 15

NORTHERN SUNRISE COUNTY

BYLAW NO. Bl 71110

Being a bylaw of Northern Sunrise County, in the Province of Alberta, to establish Regional Assessment Review Boards.

WHEREAS, the Municipal Government Act, S.A. Chapter M-26, as amended, requires the establishment of Assessment Review Boards; and

WHEREAS, Section 456 of the Municipal Government Act, S.A. Chapter M-26, as amended permits two or more Councils to jointly establish Assessment Review Boards to have jurisdiction in their respective municipalities;

NOW THEREFORE the Council of Northern Sunrise County, in the Province of Alberta duly assembled enacts as follows:

1.1. This Bylaw shall be known as the "Regional Assessment Review Board Bylaw"

2. Deflnitions

2.1. In this Bylaw: a) "Board" means the Regional Assessment Review Board; b) "CARB" means the Composite Assessment Review Board established in accordance with the "Matters Relating to Assessment Complaints" Regulation; c) "Designated Officer" means the designated Clerk of the Assessment Review Board as delegated by Council. d) "LARB" means the Local Assessment Review Board established in accordance with the "Matters Relating to Assessment Complaints" Regulation; e) "Member" means a member of the Regional Assessment Review Board; t) "Regional Partner Municipality'' means those municipalities who enter into a Board Regional Joint Agreement with Northern Sunrise County to jointly establish a Regional Assessment Review Board and who enact a bylaw substantially in the form of this bylaw; g) "Regional Pool" means a group of Assessment Review Board members duly appointed by the Councils of Regional Partner Municipalities, who meet the training requirements of the Municipal Government Act

3. Membership

3 .1. Members shall be appointed to the Regional Pool by the Councils of the Regional Partner Municipalities by resolution of Council. 3.2. Membership terms will be no longer than three (3) years and will be made in such a manner that the expiry dates of members are staggered. 3.3. Members may apply for reappointment to the Regional Pool. 3.4. All membership vacancies shall be advertised to request formal submission of applications. 3.5. Appointments of members shall be made from those applicants responding on a timely basis to the advertised need. 3.6. Appointments to be made through a show of hands by Council with the candidate, or candidates, receiving the highest number of votes being appointed by resolution of Council ifthe majority of Council voted in favour of that candidate. 3.7. There will be no automatic succession appointments. 3.8. Council deems that a member appointed to the Regional Pool by a Regional Partnership Municipality is a member appointed by Council. 3.9. Council delegates the authority to the Assessment Review Board Clerk to assign a Board from the Regional Pool, as required. 3 .10. Members shall be compensated to sit at a hearing as set out in Schedule "A" of this Bylaw.

4. Panels of the Board

1 Page 159 of 272

Page 9 of 15

4.1. The Board shall sit in panels to hear assessment complaints as the nature of the complaint may permit or require, such panels to consist of: a) One Board of three members, selected by the designated officer when the Board is acting as a LARB b) One Board of three members, selected by the designated officer when the Board is acting as a CARB c) A single member Board selected by the Designated Officer when the Board is acting as a Single Member CARB or a Single Member LARB as required. 4.2. The Designated Officer may select any Board from the Regional Pool, provided that a Municipal Government Board member sits on a CARB

5. Chairperson

5 .1. The Board shall designate one member to be Chairperson provided however that: a) The provincial member must be the Chairperson of a panel sitting as the Composite Assessment Review Board; and b) The Provincial member must be the sole member of a panel sitting as a Single Member Composite Assessment Review Board. c) Where possible, the Designated Officer shall include on a three (3) person panel a member who is from the municipality under whose jurisdiction the complaint arises. d) The Chairperson of a panel: I. Will preside over and be responsible for the conduct of meetings; ii. May limit a submission if it is determined to be repetitious or in any manner inappropriate; and iii. Will vote on matters submitted to the Board unless otherwise disqualified.

6. Jurisdiction of the Board

6.1. The Board shall have jurisdiction to exercise the functions of a LARB and the functions of a CARB under the provisions of the Municipal Government Act in respect of assessment complaints made by an assessed person of a Regional Partner Municipality.

7. Designated Officer of the Assessment Review Board

7.1. Council hereby appoints the Director of Legislative Services as the Designated Officer in the position of Clerk of the Assessment Review Boards. Duties and responsibilities are outlined in the Municipal Government Act, Part 11, Assessment Review Boards, and the "Matters Relating to Assessment Complaints" Regulation. 7.2. In the event the Designated Officers is unable to perform the duties of the Clerk, Council hereby authorizes the Chief Administrative Officer to appoint a qualified Clerk from a Regional Partner Municipality.

8. Complaint Fees

8.1. Complaint Fees are set out in Schedule "B" to this Bylaw.

9. General Matters

9.1. Those portions of Bylaw No. B022/95 referring to an assessment appeal board, and any amendments thereto, are hereby rescinded in their entirety.

READ a first time this Z2nJ. day of l\ril' 2010 READ a second time this~ day of Apol , 201 O

READ a third time this.;l~nc\ day of¥' 2010

2 Page 160 of 272

Page 10 of 15

q Reeve ~ 7 Chief Administrative Officer

3 Page 161 of 272

Page 11 of 15

Northern Sunrise County Bylaw No. Bl71/10 - "Regional Assessment Review Board" SCHEDULE "A"

1. Remuneration for all Assessment Board members participating in the hearing shall be as follows: 1.1. Chair • $155 up to 4 hours • $255 for 4 hours up to 8 hours • $455 for over 8 hours

1.2. Member • $100 up to 4 hours • $200 for 4 hours up to 8 hours • $400 for over 8 hours

2. Travel and Subsistence shall be compensated at the rate of the municipality convening the Hearing.

4 Page 162 of 272

Page 12 of 15

Northern Sunrise County Bylaw No. B171/10- "Regional Assessment Review Board" SCHEDULE "B"

1. Complaint fees are set as follows: 1.1. Residential/Farmland Appeals - $25.00 per parcel 1.2. Commercial/Industrial Appeals - $100.00 per parcel

5 Page 163 of 272 Page 13 of 15

ASSESSMENT REVIEW BOARD

JOINT REGIONAL AGREEMENT

BETWEEN Clear Hills County Box 240 Worsley, Alberta TOH 3WO

and

Northern Sunrise County Bag 1300 Peace River AB T8S 1 Y9

and

Town of Peace River P.O. Box 6600 Peace River, AB T8S 154

and

Village of Hines Creek Box 421 Hines Creek, Alberta TOH 2AO

Village of Nampa Box 69 Nampa, AB TOH 2RO {h ereinafter referred to as the "Municipalities")

The Municipalities hereby agree to ent er into a Joint Regional Agreement for the sharing of Assessment Review Board members in accordance with the t erms and conditions co ntained herein.

1. DEFINITIONS

a) "Act" means the Municipal Government Act, R.S.A. 2000, Chapter M-26 and any amendments thereto.

b) "Board" means an Assessment Review Board established by a Member Municipality in accordance with the Act.

c) " Board Member" means a person appointed by a Council and qualified to serve on a Board in accordance with the Act.

d) "Clerk" means the designated officer authorized to act as the Clerk of a Boa rd .

e) "Council" means the Council of a Member Municipality.

f) "Hearing" means a meeting of a Board. Page 164 of 272

Page 14 of 15

Assessment Review Board Joint Regional Agreement 2

g) "Member Municipality" means a municipality participating in the sharing of Board Members as evidenced by their signatures to this agreement either individually or collectively as the context requires.

h) "Regional Pool" means all of the Board Members collectively.

2. BOARD HEARINGS

a) Each Member Municipality is responsible for the administration and costs of the Board process for their municipality.

3. REGIONAL POOL

a) By February 1 st of each year, the Clerk for each Member Municipality shall advise the Clerk of each of the other Member Municipalities of the :

i. Name of its Board Members; and

ii . The contact information for each Board Member, including telephone numbers, email address, and mailing address.

b) In the eve nt a Council appoints a Board Member after February 1 st in any given year, the Clerk of that municipality shal l advise the Clerk of each of the other Member Municipalities of the name and contact information for the Board Member within fourteen (14) days following the appointment.

c) For the first year a Member Municipality participates in the Regional Pool, the Member Municipality sha ll provide the name and contact information for its Board Members to the Clerk of each of the other Member Municipalities within fourteen (14) days of signing this Agreement.

d) Each member municipality will be responsible for providing the following number of trained board members to the Regional Pool :

i. Municipalities with a population of less than 1000 at least 1 Board Member

ii. Municipalities with a population of more than 1000 at least 2 Board Members

4. SHARING OF MEMBERS

a) In the event a Member Municipality requires a Board Member from the Regional Pool for a Hearing, the clerk from t hat municipality is responsible for composing the appropriate board {LARB or CARB) and assembling the Board in the regulated timeframe pursuant to the Municipal Government Act.

b) Once a Board has been selected, the Clerk of the municipality convening the Hearing shall notify the Clerk of each of the other Member Municipalities of:

i. the names of the Board members selected; and

ii. The date, time and place of the hearing. Page 165 of 272

Page 15 of 15

Assessment Review Board Joint Regional Agreement 3

5. GENERAL a) Should a Member Municipality wish to withdraw from participation in this Agreement, they may do so by serving six (6) months' written notice to each of the other Member Municipalities. b) Additional municipalities may enter into this Agreement upon the written consent of all Member Municipalities.

IN WITNESS WHEREOF the Member Municipalities have executed this Agreement as evidenced by the duly authorized signature below.

CLEAR HILLS COUNTY VILLAGZEOFN ~~/7 Per :_. ~ ::: ~~ Per: -.--_.-~c:~~>?~2~ Date: Qvv-t--J8/,;iw Date:_-'9""'""""' 4~·L..-L9~/t...i.=d __ I NORTHERN SUNRISE COUNTY

·Per~:_ _~ _._""'------Date: ______

VILLAGE OF HINES CREEK

Date: ______Page 166 of 272

Councillor Committee Report

Name: Councillor Boisvert

Date: 22/10/2019

Meetings/Events Attended:

Oct 8 Council Mtg GPC Mtg – Great Discussion on 4 key Issues – refer to minutes

Oct 10 Calgary Energy Round Table 1st Speaker John Whelan Senior VP Upstream Imperial Oil Energy Outlook - higher demand up 20%, power generation up 16%, only 1 in 7 people on earth have access to electricity (the 6 in 7 are oil & gas Global Requirement will be up 55% by 2040. It will take 13-21 Trillion in USA $ investments to meet World Energy Needs. On the flip side, the world is on a path to 3 Deg temp rise, not the 2 Deg under Paris Accord. Curl Ft Mac does not use an Upgrader to get Oil to Market at the same Green House Gas as Conventional US Oil 4 major Challenges - Higher Costs in remote areas, regulatory uncertainty, market access (pipelines) and need social licence

Tracy Robinson - TC Energy Canada is the most cost-effective gas producer TC Energy is investing 15 Billion for Egress (Pipelines)

Randy Toone – Exec VP President Midstream, Alta Gas US has too much resources Alta Gas exports propane to Asia LPG LPG replaces wood and coal, some countries subsidizing to prevent deforestation

Q & A: John Whelan when asked – was opposed to curtailment routed in market access challenge Hurts investor confidence, hurts free trade, changes rules on investment Future is Market Access Oil to Rail should be increased to 600,000 BBLs / day

Tracy Robinson – TC Energy – involved in 670km LNG to Kitimat 48-inch line, 6 yrs of const They have agreements with All 20 First Nations for jobs, training & objective is mirror workforce proportional to Aboriginal Population Some Aboriginal incentives /agreements were negotiated with Curl and Aspen Ft Mac Projects Page 167 of 272

Note: Aspen project was then deferred in Nov 2018, slow ramp down due to uncertainty Can be ramped up – 700 Const jobs & 200 Operational jobs 4 billion in Tax & Royalties – 10 billion over Life Span of Aspen Project

Bill C69 – Situation pre and post Bill C69 = Uncertainty Gas Pipelines have never been denied permits, usually a 3-4 process to construct Egress Pipeline Bill C69 needs to be amended to provide clarity on process Bill C69 completely overlooked the “Need to be Competitive New under C69 is NEB was designed to arms length to gov’t & politics Now politics has input under Ministerial Approval / Appeal John said C69 politicises the Regulator – Canada Regulator now ranked 34th of 35 in the World

Groups are now “Stopping Traffic” (Edmonton Walterdale Bridge) Gov’t’s creating War Rooms Industry needs to figure out “How to meet Emotions with Emotions” Protestors are more emotional and ready to stop traffic Industry supporters are upset by not as emotionally involved to match (my interpretation fyi) Speaker said “We need to reach School Boards, Teachers to reach Kids to Educate on Energy “ That Canadian Energy is clean and efficient and will help reduce GHG in 3rd world/ Asian Countries

Investing Trends in Energy Julia - Investors looking for “Decarbonization goals” i.e. Hydro Electric / Solar Kelsey – looking to see who will Consolidate in Oil Sector – Acquisitions Andrew – biggest concerns for investors are regulatory concerns & market access Cape Town South Africa had investors proceed with a 15 Trillion “Devestature” This is a Techtonic Shift There has not been a sufficient response to climate change 50 % investors want goals set at 1.5 deg 46 % investors want goals set at 2.0 deg

One closing keynote told Attendee’s “We’re a bunch of lawyers and engineers talking to ourselves in an Echo Chamber to ourselves and right now, we’re getting beaten up by a 16 yr Old from Sweden… “

I have 20+ pages of notes, that I’ve kept and will refer to in future reports. The Energy Round Table was very informative and up to the minute current to oil industry NSC’s tax base is from Canada’s 3rd largest Oil Sands – we need to be in this room FYI Thanks Dan

Page 168 of 272

Oct 15 NEW water Ltd. Board Meeting After approx. 1½ years of planning and legal, NwL has an agreement to partner up with Lubicon Band. This is good for existing 3-part 9 Company existing and new member. Signed an Agreement with Kineticor to supply water to help in Power Production. This will bring good construction jobs to our area with a forecasted 2022 first power production timeframe.

Upcoming Meetings/Events:

Oct. 17 Annual County Road Tour Oct. 18 Alberta Employment Law Seminar – Edm. Oct. 22 NS County Organizational Meeting Council Meeting Budget Meeting Part 1

Page 169 of 272

Calgary Energy Roundtable Conference Programme

THURSDAY, OCTOBER 10TH

Impen'a1Ba11room | CALGARY HYATT REGENCY J 7oo CENTRE ST

MC: Tom Clark

VETERAN JOURNALIST AND CHAIR, GLOBAL PUBLIC AFFAWRS

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9II5AM INVESTING TRENDS IN CANADIAN ENERGY

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Councillor Committee Report

Name: Deputy Reeve Duval

Date: 22/10/2019

Meetings/Events Attended:

October 1 – NSC strategic planning: Another good session working with council and staff to bring forward our strategies for next year and keep us focused on what we need to do in what could be a challenging year.

October 2 – Mighty Peace Tourism strategic planning: Worked with an Alberta Culture and Tourism facilitator to review and refocus our strategic plan. We had about 20 people in the workshop which included municipal representatives, operators, staff and a Travel Alberta rep. Some excellent discussion as we redid our mission and vision statements and prioritized seven goals that we wanted to focus in the next one to three years. We will be sharing the strategic plan with all our members as soon as we finalize it.

October 3 – Sisters in Spirit walk: This is the first time I attended this event and it was a great experience. It is sad to see the family members that have been so negatively impacted by violence in our communities. It is also sad to see the many people that hold out hope to be reunited with lost loved ones and how I hope that some day their wish comes true to be reunited with those lost individuals. I also hope that those people that are seeking justice for their murdered family members get that justice some day.

October 7 – Listened to the GOA finance minister’s townhall: No earth-shattering news here. They are still not divulging their plans for the budget until the end of the month and he did his best to answer questions without committing to financial goals. Many of the questions were in line with what we have for concerns such as MSI funding, educational support, linear taxation, etc. Should be an interesting budget at the end of the month.

October 8 – Council

October 8 – Governance and Priorities: Good discussion on the roads and drainage programs and how we will need to continue to work with administration to execute on those priorities.

October 8 – Economic development: Reviewed the business park strategic plan with Dan Dibbelt and we will be bringing it back to council for review at the October 22nd meeting. We are putting an ad in Move Up magazine promoting all our small businesses in time for the holiday season. We had a discussion around broadband options and cell towers, and everyone agrees that something needs to be done but like council they are concerned with the cost of the options. The members liked the idea of having the website reviewed with citizens at the open house in December. The EDO continues to work on women in business

Page 174 of 272

networking workshops. They are also wondering if council would consider letting small businesses put up booths at our Canada Day celebration.

October 15 – Peace Valley Snow Riders 10-year anniversary: Good turn out of volunteers, snowmobile dealers and residents looking at joining the group. I’m glad to see this group have success with developing a responsible recreational activity in our community.

Upcoming Meetings:

October 17 – Road Tour October 17 – Heart River Housing October 19 – Multiplex grand opening October 22 – Council/Organizational October 24 – Chamber of Commerce small business week October 27 – TOPR ICF October 28 – TOPR ICF October 28 – Budget

Page 175 of 272

Councillor Committee Report

Name: Councillor Williams

Date: 15/10/2019

October 2 - Strategic Planning: A full day of great discussions and forward thinking to look at the upcoming year.

October 3 - WNC: Kristen Anderson gave a presentation of wetlands. We are in a time of increasing wetlands versus draining concept that was experienced in the past. How can we adapt to this new way of flood mitigation? Alberta is the only Province that does not have a flood mitigation bank. Storm water management needs to be incorporated into planning developments. The Provincial Government is looking at new directives for compensation incentives to reduce flow and retain storm water, very much like ALUS. I did question how this funding would be achieved and something to keep on our radar of another download from the Government as it was mentioned Municipalities would be responsible for this. Communication for all aspects of land clearing especially removal of trees that we are all aware speeds up the water flow causing more erosion. Some interesting dense live toe staking has been accomplished at sliding river banks to prevent more slides which has been very successful. Using poplars and willow sticks which are set in the ground by a metre deep and the root system takes off rapidly. Interestingly the sticks used were ones utilized from fallen trees, the rapid growth is quite remarkable. A possibility for the bank of Murphy’s Flats perhaps. Continuing advocacy for communication of water resources, usage and water operator trainees. With the online courses being more available to challenge the level 1 it will be beneficial to treatment plants to bring in younger operators for training. Can we utilize career fairs to get high school graduates interested in water operator position\training and is there a high school program available to coincide with this?

October 8 - Council & Governance and Priorities. The vision of Council for the next year and beyond was with great discussions. Our commitment for residents is clear going forward.

October 9 - I attended the All Candidates Forum, some of the questions asked by the public were of health care, road repairs and budget. It was interesting to hear each of the representative’s answers to these questions which were not really answered but gave information of their platforms.

October 10 - ACCPA teleconference: We hope to be launching the registration webpage on November 15th. We have confirmed speakers from New Zealand and England touching on topics of both Urban and Rural. Holland and how they managed to cut crime. This will be a 4- day conference of many insights into crime prevention and strategic mapping systems.

October 10 - NSRCWA presentation to Grimshaw. There was great interest in the Crime Watch program and the presentations from Sgt Browne and Lucas Madsen were informative Page 176 of 272

for all those who attended. More members signed up and we are very close to the 700- member mark now. I also presented the LightCatch App which was downloaded that evening.

October 15 - NWL: The “whale” (air bubbles under the liner ) in the WTP are being repaired, it was suspected an animal had made holes in the liner when the water level was low, the air and water are being removed and is being patched. The old process pond has been filled in. All stations continue to work well with no issues. Three Creeks Power gave a presentation of how the water usage would be used and the amounts required. This will be a positive investment to NwL/NSC and area for both employment and industry. Mathieu Duval passed his Level 1 water treatment and water distribution certification….congratulations Mathieu!!

Oct 16 - Myself and Councillor Boisvert attended the 10th Year Snowmobilers Club Anniversary. It was interesting to see the old snowmobile machines compared to the newer models, especially the motocross bike kit that can be added to make a motocross bike into a snowmobile. Looking at all the maps and the accomplishment of the trails is to be commended. The passion from all that attended was very evident. Speaking with Francois Allard his commitment to grooming the trail is admirable with many hours and finances invested. He often leaves at 5am to groom the Wesley Creek Trail! Francois and Pierre would be great candidates for next year’s volunteer award for their selfless commitment to not only this area, they are known to groom around St Isidore also for cross country skiing. Dwayne Buchholtz won the Snowmobiler of the year award which he will be presented with next week. Congratulations Dwayne.

Upcoming Meetings: Oct 16 - CAC Oct 17 - Road Tour Oct 18 - Employment Law Seminar Edmonton Oct 19 - Region 6 Metis AGM Ski Chalet PR Oct 19 - Grand Opening Baytex Arena Oct 22 - Council and organizational meeting Oct 23-26 AB Recreation and Parks Conference

Page 177 of 272

Councillor Committee Report

Name: Audrey Gall

Date: October 21, 2019

Meetings/Events Attended: October 8 - Council meeting October 8 - GPC meeting - allowed council and staff to have longer, more detailed discussions about Drainage projects, red tape reduction, the rural road study table and outdoor recreation promotion than accomodated during a regular council meeting. October 8 - PRCCA - the Board continues to work with Children and Family Services to transition the Families First Program to a different coordinator. October 15 - Peace River Aboriginal Interagency Committee. In addition to the regular meeting business, Dennis Whitford led a Pipe Ceremony. As he carried out each step he explained what he was doing and why. The process takes almost an hour. October 16 - MPC - two development permit applications. Good discussion. October 17 - Annual Council Road Tour. An opportunity for individual members of council to show the balance of council noteworthy items or items of concern in their ward. For my ward this year I addressed the challenges on Eastridge and the roadside right of way brushing program. October 19 - Grand opening of the Baytex Energy Centre in Peace River. Many people took the opportunity to wander through the facility to view the opportunities available. While it is always easy to criticise, the facility will serve the Town and surrounding area in ways that the old arena was not able to do so I would encourage community members to appreciate all the positives.

Upcoming Meetings: October 22 - Council - 2020 Budget - first round discussions

Page 178 of 272

Councillor Committee Report

Name: Reeve Kolebaba

Date: 21/10/2019

Meetings/Events Attended:

October 9 2019 Medical Clinic and Move up Magazine We have been asked to have the story of the medical Clinic in The Move up magazine, so Mike, Cindy, Dan and I met with the magazine for an interview and pictures.

October 15 2019 New Water Board meeting. Operation report was given and we are doing well at all stations. We are on budget and have agreed to a rate increase of 2% for 2020. Drafts Capital and Operation Budgets were approved. New Water has signed the agreement for supply water with Kineticor, for the Three Creeks Power Project. We have signed the USA United Share Holders agreement, Revised Corporate Bylaw No.1 for the inclusion of Lubicon Lake Band #453. They will buy 13.64 shares and have 2 seats on the board.

October 17 2019 Road tour and visit to the ASB office, drive through seed cleaning plant and driving tour of CNRL area of operation. Thanks to the administration for the organizing and help on the tour, Council has referred thoughts to Governance and operations.

October 17 and 18 Employer Labour Seminar put on by RMRF The UCP have changed or reversed several regulations to labour. If 65% of employees want a union it was automatic. This has now been changed to 40% and needs a vote where 50%, plus one, has to vote in favour to have a change, and 90 days to garner support from employees instead of 6 months. Secret Ballot is mandatory. Employee hot line has been put in place. Enable junior high students to work in a coop program. The trends are for less regulations. If there is a strike you can now replace the striking employees during strike. WCB has been reduced from 10 to 7. If you have more than 20 Page 179 of 272

employees you need a Joint Occupation Health and safety Committee. Holiday pay requires, if an employee does not work on the holiday, they are only entitled to holiday pay if the holiday is on a day the employee would regularly work. Banked over time requirements: time off with pay, instead of over time, calculated at 1:1. Creation of student minimum wage: If school is in session, minimum wage is 13$ per hour for the first 28 hours of work per week and 15$ per hour for additional hours. If school is not in session, minimum wage is 13$ per hour. The Human Rights Board is now 5 members Employment contracts are one of the most effective ways for employers to manage the employment relationships, minimize potential liability, and set employee expectations. Legal requirements are 1. Offer 2. Acceptance and 3. Consideration (Means binding something of value for service for $ or Salary may be other things ie: vacation. Employment contracts need to be in writing if over a year, I do not like this one. Big lesson to put everything in writing and review with employee and sign off by both parties. The lawyers, when asked a question, 9 times out of 10 will say it depends on circumstances. Written contracts reduce employer liability, reduce misunderstandings, and encourage the parties to consider and address important issues. ie: dress codes, criminal credit checks. Oral contracts are not good for many reasons. Make sure in contracts you have, that your job may be modified from time to time. If the job is modified, then change the contract to represent the change. If you have a termination clause, make sure it is brought to the employee’s attention upon hiring, and they initial the clause. Best practise: Ensure the contract covers any special promises or consideration. Termination clauses require special attention, as do clauses dealing with post- employment obligations. Be careful with template contracts. Termination by an employer can be 1. Without Clause 2. For Just Cause 3. Constructive Dismissal. In all of the above keep Written records very accurate and updated.

October 19 2019 Baytex Energy Centre is officially opened by the regional partners. It rests in the boundary of Peace River. It is to serve the regions diverse population for their better health and enjoyment for many years to come. Congratulation to all the staff and Municipalities that supported its completion.

October 21 2019 Federal election; hope all voted.

October 22 2019 Organization, Council and Governance and Priority Meetings

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Councillor Committee Report

Name: Councillor Whitehead

Date: 22/10/2019

Meetings/Events Attended:

Oct 8/19 Council Meeting

Oct 8/19 GPC Meeting

Oct 17/19 Road Tour

The road tour this year was even better; even in the rainy part of the day and even if some of the roads were muddy. It was great to finally see where the trains are, where the steel comes in for the bridge, and that it takes two carts to carry one on. It is the first time I went to the water plant in Three Creeks and down to the river edge. I finally know where the William Mckenzie Reserve is and that it belongs to Duncan’s First Nation. This year we went to different places than last year. I got to see more of the County and I realize how big the County really is.

Upcoming Meetings:

Oct 22/19 Council Meeting

Oct 23-27/19 Lake Louise ARPA Conference

Oct 28/19 Budget Meeting Part 2

Oct 29/19 St Isidore ASB Wksp

Oct 30/19 Grande Prairie Forestry Wksp

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Chief Administrative Officer Report October 8 - 21, 2019 Meetings of Council  October 8, 2019  October 8, 2019 (Governance & Priorities Committee)  October 17, 2019 (Road Tour)

Administration  October 9, 2019 – Medical Clinic Planning Meeting  October 9, 2019 – Move Up Magazine Photos at Medical Clinic  October 10, 2019 – Meeting with Agricultural Fieldman & Director of Legislative Services – re: Order of Reclamation  October 11, 2019 – Contract/Procurement Training in Grande Prairie  October 15, 2019 – NwL Board of Directors Meeting

Annual Report At Council’s direction, Administration has researched the costs associated with the Annual Report published by Big Lakes County (BLC). BLC has a full time Communications Coordinator and the annual report is assigned to this employee. It takes about one full month of the employee’s time over the course of the year for this publication (approximately $3,800), plus other staff time for the compilation of supplied data (typically from the managers). Originally BLC hired a consultant to develop the template for the annual report. The cost of the consultant was not provided by BLC. The cost of printing 175 copies of the report was approximately $2,500. The report is available for residents to pick up at their annual Summer BBQ (usually July). Without knowing additional staffing resources required from BLC, we are only able to estimate the cost of $6,300 for the annual report for 175 copies. BLC also produces a monthly online newsletter.

Currently, NSC publishes a quarterly newsletter that is mailed out to approximately 750 residents of the County. The approximate cost for printing is $8,000/annum plus $2,000 for postage for a total of $10,000. The newsletter is also available online and in hard copy at the Administration office. The newsletter is completed through a software program used by several staff members. We would be able to use this software to create an annual report with printing being available at Valley Printers who print our current newsletter. A quote for a report similar in size to BLC would be $11.32/copy.

Administration is requesting direction from Council on the above.

External Safety Audit The County is currently undergoing its external recertification audit for our Certificate of Recognition (COR). The audit is being conducted by a safety auditor from the Town of High Level. Three of the County’s facilities will be toured during the audit process as well as interviewing several staff members. The audit is expected to be completed by October 25, 2019.

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Modern Communication Opportunities Administration has included the Voyent Alert software costs into the 2020 Operational Budget for Council to consider. The fee is $2,000 per year for the software. Staff resources will also need to be allocated to administer the software. The software would be used Monday to Friday during regular business hours, with the exception of an emergency when other communication protocols would be in place.

The Village of Nampa may be interested in partnering with the County for the software so a portion of the annual fee would be provided by the Village. An Agreement for the funding would have to be established. Administration has been advised that the Town of Peace River will be using Voyent Alert as a communication tool as well.

Northern Sunrise County – Christmas Float/Parade – November 29, 2019 The annual Peace River & District Chamber of Commerce Santa Claus Parade is scheduled for November 29, 2019. This year’s theme is Winter Wonderland. Administration has sent out an email to Council and staff to develop a Committee to work on this year’s float. Additional emails will be sent out as the project commences and continues on.

Upcoming Meetings  October 27-28, 2019 – ICF Meetings with Town of Peace River  October 28, 2019 – Budget Meeting (Part 2)  October 30, 2019 – JHSC Meeting  October 30, 2019 – Manager’s Meeting  November 12 – 15, 2019 – RMA Fall Conference

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2019 STRATEGIC PRIORITIES CHART Approved November 13, 2018 Updated: September 26, 2019 COUNCIL PRIORITIES (Council/CAO) NOW 1. FCSS TERMS OF REFERENCE - COMPLETE 2. LITTLE BUFFALO LAGOON: Construction in progress 3. MUNICIPAL DEVELOPMENT PLAN: In Progress 4. COUNTY FACILITIES: Options Feasibility - COMPLETE 5. PEACE RIVER/NSC IDP Draft - COMPLETE

ADVOCACY / PARTNERSHIPS NEXT 1. Transmission Charges: Local Power Production (RMA) 1. RENO COMMUNITY: Meeting – COMPLETE 2. Peace River Medical Clinic: Construction 2. MURPHY FLATS: Plan – COMPLETE Budget 2020 Discussions 3. Woodland Cree First Nation Protocol 3. CHILDCARE: Partners – In Progress 4. Little Buffalo Reserve Application: Support 4. COMMUNITY HALLS ASSESSMENT: Report – COMPLETE 5. Peace River ICF – In Progress 5. COMMUNITY HALL SUPPORT: Policy – COMPLETE 6. Cell Coverage (TELUS) - COMPLETE 6. DONATION/SPONSORSHIP REQUESTS: Policy – COMPLETE 7. Highway Signage for Waterways (AT) 7. TAXATION FORMULA: Commercial and Industrial – COMPLETE 8. BROADBAND: Proposal for Sunrise Gateway Business Park – COMPLETE 9. NAMPA INTERMUNICIPAL COLLABORATION FRAMEWORK – COMPLETE 10. PEACE RIVER INTERMUNICIPAL COLLABORATION FRAMEWORK –In Progress 11. IDP/ICF PROGRAM: Chart – COMPLETE 12. LITTLE BUFFALO TRANSITION STRATEGY – In Progress 13. OUTDOOR RECREATION INVENTORY – GPC Meeting October 8 OPERATIONAL STRATEGIES (CAO/Staff) CAO ECONOMIC DEVELOPMENT (Lynn) 1. PEACE RIVER IDP – COMPLETE 1. BROADBAND SERVICE: SUNRISE GATEWAY BUSINESS PARK – 2. MURPHY’S FLATS PLAN – COMPLETE Budget 2020 Discussions COMPLETE – Install to be completed by December 2019 3. NAMPA/COUNTY ICF – COMPLETE 2. Cell Phone/Broadband Policy Support – COMPLETE • RENO COMMUNITY MEETING – COMPLETE 3. Industrial Park Commercial Plan – October • IDP/ICF PROGRAM CHART – COMPLETE • Business Network Program – Ongoing ENGINEERING (Ian) AGRICULTURAL SERVICES (Sebastien) 1. LITTLE BUFFALO LAGOON APPROVAL – COMPLETE 1. Park Amenities: Inventory & Proposal – October 2. MUNICIPAL DEVELOPMENT PLAN: ToR – COMPLETE 2. Ag Services Building Title Transfer – COMPLETE 3. COMMUNITY HALL REPORT – COMPLETE 3. Regional Ag Weed and Pest Notice Appeal Board TOR – COMPLETE • Pest Management Plans Review – Provincial – COMPLETE • Provincial ASB Program Review Steering Committee – COMPLETE FINANCE (Bob) COMMUNITY SERVICES (Amber) 1. TAXATION FORMULA -commercial and industrial – COMPLETE 1. FCSS TERMS OF REFERENCE – COMPLETE 2. Asset Management Inventory: Plan – In Progress 2. CHILDCARE: Partners – In Progress • Bad Debt Policy 3. OUTDOOR RECREATION INVENTORY: Review – GPC Meeting Oct 8 • Host Spring Regional Meeting – COMPLETE

ASSESSMENT (Mike G) LEGISLATIVE SERVICES (Olive) 1. TAXATION FORMULA -commercial and industrial – COMPLETE 1. COMMUNITY HALL POLICY – COMPLETE 2. Assessment Service Contracts – COMPLETE 2. COMMUNITY PROGRAM SUPPORT POLICY – COMPLETE

PUBLIC WORKS (Mike K) PROTECTIVE SERVICES (Dave) 1. COUNTY FACILITIES: Options Feasibility – COMPLETE 1. Bylaw Enforcement Officer Training – COMPLETE 2. Ditch Cleaning Program Review – In Progress 2. Emergency Response: Simulation – November – COMPLETE October • Primary Care Centre Construction 3. Fleet/Equipment Inventory & assessment – In Progress

KEY: BOLD CAPITALS = Councils NOW Priorities: Italics = Councils Advocacy Issues; CAPITALS = Councils NEXT Priorities; Regular Title Case = Staff Operational Strategies

K:\Council\Strategic Planning\2019\Strategic Priorities Chart 2019.docx Northern Sunrise County Page 184 of 272 Capital Projects and Reserve Forecast

ACTION ITEM LIST FOR 2019 CAPITAL ITEMS Oct-10 2019 2018 2019 2019 Expended 2019 Assigned Status Projects C/O Amount Budget TOTAL To Date Notes GL CODE To Update Engineer Contractor

Unrestricted surplus Gravel Pit Expansion in New Site $124,871 $124,871 $39,883 Murphy Pit plan in progress 4-32-10-000-640 MK Aspen Land Group Contingency $0 $500,000 $500,000 ($18)

Restricted surplus Drainage Study Programs $526,591 $1,500,000 $2,026,591 $879,331 4-37-14-000-259 IC MPA Macmillan/MDP/Northsite Peace River Medical Clinic $751,089 $2,500,000 $3,251,089 $2,974,322 interior painting, some cement work complete, ongoing 4-11-18-000-770 MK, CM BASE Various County Office Expansion $243,729 $4,854,000 $5,097,729 $481,933 In progress 4-12-00-000-620 MK, CM BASE Beairsto

Administration Fencing/Grading New County Land $20,215 $20,215 defer to 2019 4-12-10-000-620 MK County Welcome Signs $343,839 $343,839 $162,503 pricing for supply is in place, install for 2019 4-32-00-000-536 LF Fox Signs/HAE Exchange/ASD Server Replacement $40,000 $40,000 $36,780 PO issued; Deposit Paid; complete 4-12-00-000-660 BM Trinus Business Park Fibre Optic HS Internet $400,000 $400,000 $380,970 In Progress 4-61-19-008-259 LF Telus

Tractor (141,500), Hyd mower (52,000), Park mower (77,000), trailer Agricultural Service ASB Equipment $0 $353,000 $353,000 $284,319 20,600) 4-63-00-000-630 SD ASB Vehicles $0 $43,000 $43,000 $30,005 SUV (43,000) 4-63-00-000-650 SD ASB Building $0 $17,000 $17,000 $0 Fencing (17,000) 4-63-00-000-620 SD

Community Halls Cecil Thompson Park Improvements $24,372 $3,000 $27,372 $10,615 walking path complete; vollyeball nets installed; waiting for sign 4-72-16-011-670 MK Versatile/HAE Tables installed @ CT Park, Murphy's Flats (2), Reno (2) Firepits installed @ Murphy's Flats (2), Reno (2) Community Sites - Tables and Garbage Bins $0 $51,500 $51,500 $33,290 Garbage/recycle units to be installed yet @ CT Park, Reno - others on hold 4-74-19-000-259 SD/MK Haul-All (GC)/Dominion Precast (Tables)

Protective Services Fire Vehicles $0 $330,000 $330,000 $0 on order (expected delivery January 2020) 4-23-00-000-650 DL Fire Equipment $0 $0 $0 $0 4-23-00-000-630 DL St Isidore Hall $0 $9,000 $9,000 $1,217 complete 4-23-10-000-610 DL

Recreation Equipment $0 $0 $0 $0 4-72-00-000-630 Trail & Public Spaces Upgrades $10,000 $10,000 $20,000 $43,552 St Isidore Trail ($20,000 added from Council contingency) 4-72-16-000-670 MK/SD HV Park Upgrades $45,933 $0 $45,933 $2,925 In progress 4-72-17-000-670 MK/SD Murphy Flats Park Design $0 $55,000 $55,000 $28,127 In progress; 95% done, going to budget 4-72-19-000-259 IC MMSA/MPA Sagitawa Lookout Improvements $0 $0 $0 $18,240 Joint Capital w/ TPR 4-72-19-000-260 IC Parkland

Transportation Bridge Replace BF08316 $724,138 $750,000 $1,474,138 $809,541 bridge done, roadwork begun 4-32-18-401-259 IC MPA Bridge Replace BF08271 $112,917 $0 $112,917 $0 4-32-18-000-260 IC MOST MidKnight Bridge Replace BF72477 - GOA FUNDED $0 $0 $0 $4,816,424 In progress; completion 2019 GOA Project 4-32-18-688-259 IC WSP Northsite Bridge Rehabilitations $0 $750,000 $750,000 $172,756 ongoing 4-32-19-401-259 IC MOST MidKnight Bridge Assessments & Engineering $151,299 $0 $151,299 $145,346 2019 assessments underway 4-32-10-401-259 IC Various Local Road Maintenance Programs $456,688 $500,000 $956,688 $490,099 as needed; slide and spot repairs RR 204 North 4-32-16-000-259 MK In House and Various Infrastructure Assessment Update $155,416 $0 $155,416 $51,449 report complete, addressing items identified 4-32-00-000-620 IC 822 Extension - Engineer & Survey $0 $100,000 $100,000 $18,000 paved road assessment complete, report anticipated by Oct 1 4-32-19-822-259 IC RR 210 (Gunning) Street Lights $0 $100,000 $100,000 $34,500 Material received, scheduling install 4-32-19-210-259 IC Mainway Resident Requests for New Roads $0 $250,000 $250,000 $6,679 4-32-19-999-259 IC LB Cultural Camp Access Road - Band Funded $0 $0 $0 $309,991 4-32-16-003-259 IC Oil Stabilized Program $0 $1,000,000 $1,000,000 $25,283 4-32-19-000-259 IC in house summer 2019 Regravel Program $0 $1,000,000 $1,000,000 $734,337 4-32-19-000-534 MK gravel haul list Culvert Replace Program $0 $300,000 $300,000 $97,330 44/50 approaches installed to date. 4-37-14-000-537 various underway

Roads - equipment Transportation Equipment $0 $515,000 $515,000 $214,800 loader complete, picker truck on order 4-32-00-000-630 MK finning/kenworth Transportation Vehicles $0 $55,000 $55,000 $48,859 Complete 4-32-00-000-650 MK Mighty Peace Chev Transportation Shop Roof $135,075 $0 $135,075 defer to 2019 4-32-00-000-610 MK Lavergne/Deboon

Water and wastewa Little Buffalo Hamlet Water System $100,000 $0 $100,000 $15,588 On hold 4-41-14-003-620 IC Little Buffalo Waste Water Treatment $2,185,317 $0 $2,185,317 $1,678,742 Construction underway 4-42-16-003-259 MK/IC WSP Northsite WCFN Lagoon Expansion $468,962 $0 $468,962 $49,789 Complete. County's 15% portion of project costs 4-42-16-004-259 IC BCL Kelsey Pipelines Ltd. Truckfill Control Systems $30,807 $0 $30,807 $0 As needed 4-41-15-000-660 MK SCADA Maintenance, Programming $10,483 $0 $10,483 $20,762 As needed. 4-41-14-000-660 MK Nason Nampa Reservoir Expansion ($817,402) $0 ($817,402) $65,936 construction underway, 95% complete 4-41-17-009-670 MK/IC M2 Engineering AGS/Mainway Marie Reine Liftstation Upgrades $0 $350,000 $350,000 $68,068 equipment ordered in progress 4-41-19-005-259 MK/IC AGS/Mainway Replacement Pumps and Drives $30,000 $0 $30,000 $0 As needed 4-41-17-009-259 MK/IC GPR Industries 22,169,838 $10,465,847

plus 2019 GOA Funded BF 72477 11,862,911 Page 185 of 272

PRED REGION PEACEECONOMICDEVELOPMENTALLIANCE for Northwest Alberta September 30, 2019

Enclosed you willfind a complimentary master copy of the Northern Commodities —- Agriculture report

completed under a partnership of the Peace Region Economic Development Alliance(PREDA)and the

Regional Economic Development Initiative — Northwest (REDI). This report presents in detail the

agricultural commodities grown and bred in the Northwest, the production volumes, the amount that is exported, where these agricultural commodities are exported, and the primary mode of transportation

used to get these commodities to export position.

It is hoped that the information contained in this report will be of use to you and your stakeholders when researching, creating, and or negotiating economic development opportunities for the agricultural producers and potential investors in your area.

Copies of the report can be downloaded free of charge from either the PREDAor REDIwebsites. Master

copies, such as the one enclosed, can be printed at a cost of $35 per (shipping included) upon request to

PREDA at [email protected].

This report is one of three in a series that are being completed under the PREDA] REDIpartnership. Our

next report, Northern Commodities — Oil & Gas, will be released at the end of October 2019. The final

report, Northern Commodities — Forestry, will be released in February 2020.

Ifyou have any questions, please do not hesitate to contact us.

Regards,

Elaine Garrow Lisa Wardley Chair-—PREDA Chair— REDI

PREDA 10128 95” AVENUEGRANDEPRAIRIEAB T8V OL4 780-527~6232 (VOICE) REDI P.O. BOX210 9810—99STHIGH LEVEL,AB 1—800~922-4233 Page 186 of 272

Northwest Alberta – Agriculture Commodities September 2019

September 2019

Northwest Alberta – Agricultural Commodities What are the products? How much is produced? Where are the products exported? How are the products transported?

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Northwest Alberta – Agriculture Commodities September 2019

In Partnership

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Northwest Alberta – Agriculture Commodities September 2019

Table of Contents Executive Highlights 7

Purpose of Report 10

Map of Alberta – PRDA / REDI Regions

Section 1- Setting the Stage

Global Trade – Canada – Alberta 13 Global Net Importers and Exporters Canada Imports – Top 25 Products Canada Imports – Top Seven Countries Canada Export Revenues 2013 to 2017 Canada Export Revenues – Top 25 Products Canada Export Revenues – By Province / Territory Alberta Export Revenues 2013 to 2017 Alberta Export Revenues – Top Countries Alberta Export Revenues – Top 25 Products Alberta Export Revenues – USA Trade - Distribution by US State

Section 2 - Agriculture

Land Use Type 24 Canada, AB, Northwest Alberta – Number of Farms by Type Canada – Farmland Use Northwest Alberta – Agricultural Land Inventory Type – By Municipality

Cropland – Exports 26 Northwest Alberta – Cropland Acres – Crop Type - By Municipality Canada and Alberta Principle Grains and Oil Seeds – Production Northwest Alberta Principle Grains and Oilseeds – Acres and Production List of Process Grain Elevators in Alberta Northwest Alberta Deliveries to Primary Grain Elevators – Volume Alberta Export Revenues – All Plant Products

Wheat 31 Alberta Export Revenues – Wheat by Country Top Global Wheat Produces Global Demand for Wheat Northwest Alberta Deliveries to Primary Elevators – Wheat Alberta Exports Revenues - Wheat to Japan – Mode of Transport, Volume

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Northwest Alberta – Agriculture Commodities September 2019

Table of Contents (cont’d)

Alberta Exports Revenues - Wheat to Indonesia – Mode of Transport, Volume Alberta Exports Revenues - Wheat to Bangladesh – Mode of Transport, Volume Albert Exports Revenues - Wheat to USA – Distribution by State Alberta Exports - Wheat to USA - Mode of Transport

Canola 35 Alberta Export Revenues Canola Seeds – By Country Northwest Alberta Delivery to Primary Elevators – Canola Seeds – Volume Alberta Export Revenues – Canola to China – Mode of Transport, Volume Alberta Export Revenues – Canola to USA By Rail - Volume Alberta Export Revenues – Canola to USA By Road – Volume

Dry Field Peas 39 Alberta Export Revenues Dry Field Peas – By Country Northwest Alberta Delivery to Primary Elevators – Dry Field Peas – Volume Alberta Export Revenues – Dry Field Peas to India -Mode of Transport, Volume Alberta Export Revenues – Dry Field Peas to China -Mode of Transport, Volume Alberta Export Revenues – Dry Field Peas to Bangladesh -Mode of Transport, Volume Alberta Export Revenues – Dry Field Peas to USA – Distribution by State Alberta Export Revenues - Dry Field Peas - to USA – Mode of Transport, Volume

Oats 44 Alberta Export Revenues Oats – To USA - Distribution by State Alberta Export Revenues Cereal Groats and Meal – To USA – Distribution by State Alberta Oat Exports – Number of Shipments, By Type Alberta Oat Exports - By Type, By Country, Volume Alberta Export Revenues Oats – to USA Alberta Oat Exports – Number of Shipments, By Mode of Transport Alberta Export Revenues Oats – By Rail – Volume

Barley 49 Alberta Export Revenues Barley Seeds – To USA – Distribution by State Alberta Export Revenues Barley Malt – To USA – Distribution by State

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Northwest Alberta – Agriculture Commodities September 2019

Table of Contents (cont’d)

Alfalfa 50 Alberta 2017 Export Revenues – Alfalfa Seeds - to US - Distribution by State( $CA) Alfalfa Seeds – By Type Exports to USA – Certified vs Non-Certified Alberta 2017 Export Revenues – Alfalfa Seeds – By Country, Mode of Transport, Volume All US 2017 Imports $US - Alfalfa Seeds ($US) Alberta 2017 Export Revenues - Alfalfa Meal and Pellets ($CA)

Canada 2017 Export Revenues - Alfalfa Meal and Pellets ($CA) Alberta 2017 Exports - Alfalfa Meal & Pellets - to USA – Dehydrated vs Non-Dehydrated Alberta 2017 Export Revenues – Alfalfa by Type and Volume ($CA) Alberta 2017 Export Revenues – Alfalfa Bales / Loose (Non-US) ($CA)

Fescue 54 Alberta 2017 Export Revenues - Fescue Seeds ($CA) Alberta 2017 Export Revenues – Fescue by Type Alberta 2017 Export Revenues – Creeping Red Fescue – By Country, Mode of Transport, Alberta Export Revenues - Creeping Red Fescue – To USA – Distribution by State , Volume

Timothy 58 Alberta 2017 Export Revenues – Timothy Grass Seeds by Country, Transport Mode Alberta 2017 Exports Revenues – Timothy Hay – By Country, Mode of Transport

Hemp 62 Canada Other Crops – Acres Canada Hemp Exports – Volume, Value Canada Hemp Exports – By Province, Volume, Value Canada Hemp Exports – By Product Type Canada Export Revenues Hemp – By Product Type, Country

Pastureland - Exports Alberta Export Revenues – All Animal Products

Bovine (Beef) 66 Northwest Alberta – Cattle Headcount – By Municipality Alberta Export Revenues Bovine Fresh – By Country Alberta Export Revenues Bovine Fresh – To USA – Distribution by State Alberta Export Revenues Bovine Frozen – By Country Alberta Export Revenues Bovine Frozen – By Air, By Country, Volume Alberta Export Revenues Bovine Frozen – By Truck, By Country, Volume

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Northwest Alberta – Agriculture Commodities September 2019

Table of Contents (cont’d)

Swine (Pork) 69 Northwest Alberta – Swine Headcount – By Municipality Canada Swine (Pork) Exports 1960 – 2018 - By Volume Canada Swine Exports – By Province, Value Alberta Exports of Swine (Fresh) 2015-2017 – By Country, Value Alberta Exports of Swine (Frozen) 2015-2017 – By Country, Value Alberta Swine Exports – To USA – Distribution by State, Value Alberta Export of Swine – To USA – Number of Shipments, Mode of Transport Poultry 72

Northwest Alberta – Poultry Headcount – By Municipality

Live Animal Exports 73 Northwest Alberta – Other Livestock Headcount – By Municipality Alberta Export Revenues - Horses, By Country Alberta Export Revenues - Bovine, By Country Alberta Export Revenues- Swine, By Country Alberta Export Revenues – Sheep & Goat, By Country Alberta Export Revenues - Poultry & Turkeys, By Country

Honey and Bees 75 Alberta Export Revenues – Natural Honey – By Country Alberta Export Revenues – Natural Honey – to USE – Distribution by State Alberta Export Revenues – Bees – to USA – Distribution by State Alberta Export Revenues – Bees – By Country, Mode of Transport, Volume

Closing Comments 78

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Northwest Alberta – Agriculture Commodities September 2019

Executive Highlights

Northwest Alberta represents 3% of Canada’s farmland. The agricultural region is referred to as the “Peace Country”; the most northern agricultural region in the world; and frequently noted for the superior quality of its agriculture products. This report focuses on commercial agricultural products grown and bred in the Northwest (e.g. . cereal grains, oil seeds, cattle, pork).

Northwest Alberta has 4918 farms. A 60/40 split between cropland and pastureland.

Cropland: 1. Canola, Wheat, Alfalfa, Dry Field Peas, Barley, Hay, and Oats make-up most of the cropland acres in the Northwest. 2. Almost all the canola, wheat, and dry field peas produced in the Northwest are delivered to the local grain elevators and exported out of the region by rail. 3. The Northwest is Canada’s largest producer of Fescue (grass-seed and forage).

Crop Exports: 1. Alberta generated $101 Billion in the year 2017 exporting its products. 88.5% of all of Alberta’s (which includes the Northwest) export revenues comes from sales to the US. 2. On the global scale Canada ranks 7th for Wheat production. Alberta’s largest buyers of Wheat are the USA, Japan, and Indonesia. 3. China is Alberta’s largest buyer of Canola Seeds. In 2017 China paid $819Million for Alberta Canola Seeds. Japan, Alberta’s second largest buyer of Canola Seeds, earned Alberta $421Million in export revenues. 4. There were 87 export shipments of Canola Seeds to the United States in the year 2017. Rail transported 19 of these shipments, truck transported 68 shipments. 5. The number of acres in the Northwest dedicated to Dry Field Peas has dramatically increased in the last decade. 6. Alberta generated $181 Million exporting Dry Field Peas in the year 2017. India is the largest buyer at $118Millon. 7. Oats garnered $28 Million in export revenues for Alberta – 93% sold to the USA. 8. There were 301 export shipments of Oats in the year 2017- 204 were by truck. 9. Certified Organic Oats (by volume) are largely purchased by Japan and South Korea.

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Executive Highlights (cont’d)

10. Alberta Barley Seeds are sold to the USA (97%). In general, the seeds do not garner a lot of revenues (898K in the year 2017). Barley Malt however, garnered $241 Million in the year 2017 - $40.7 Million of which was sold to California! 11. Alberta generated $30 Million from the exports of Alfalfa Seeds in the year 2017 – 93% sold to the USA. Alberta is the USA’s biggest supplier of Alfalfa seeds. Most sales goes to Idaho - 75%. 12. Alberta generated $29.4 Million exporting Fescue Seeds – $28.2. Million was for Creeping Red Fescue. Virtually all Creeping Red Fescue in Canada is grown in the Peace Country! 13. 90% of all fescue was sold to the USA, the largest State being Oregon (branded as the turf grass capital of the world!). 14. Japan purchased $51Million in Timothy Hay from Alberta in 2017. 15. Export revenues from Hemp products peaked in the 2016 at $132 Million; the vast majority due to the sale of hemp seeds.

Pastureland: 1. The Northwest is Cattle country! At a headcount of 285K, all rural municipalities (13 of them) in the Northwest have cattle. The largest being the County of Grande Prairie with a headcount of 68K. 2. When last counted there were 111K pigs in the Northwest. Only 6 of the 14 rural municipalities reported having pigs. The largest number located in Birch Hills County at 16K. 3. There were 295K chickens counted in the Northwest. The largest count was in the MD of Greenview at 59K. The largest egg-producing headcount is in the County of Grande Prairie at 16K. 4. At last count there 47K “Other Livestock” being raised in the Northwest – horses, sheep, goats, alpacas etc.… The largest headcount of “Other Livestock” in the Northwest is Bison, at 6K located in the County of Grande Prairie.

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Northwest Alberta – Agriculture Commodities September 2019

Executive Highlights (cont’d)

Pastureland Exports: 1. Fresh Beef accounts 1/3 of all export revenues generated from the sale of animal products. $1.2 Billion in the year 2017; with 91% shipped directly to the United States. Fresh beef is delivered to 17 States; California being the largest buyer at $440 Million. TEXAS is second at $102 Million! 2. Honk Kong was the largest buyer of Alberta Frozen Beef in the year 2017 - $130 Million. 3. There were 80 export shipments of frozen beef from Alberta in the year 2017. Eleven shipments were transported by Air Cargo, forty-one by truck, and the remaining by ship (majority through Vancouver Port). Alost all truck shipments used Coutts (AB) as the export point to the US. 4. Japan is the largest buyer of Alberta Fresh and Frozen Pork. 5. Live animals are exported from Alberta. In the year 2017: $17 Million – Horses; $642 Million – Cattle; and $58 Million – Pigs.

Opportunities Identified Within the Research

1. Alfalfa Seeds / Meals - US imports almost $10Million worth from other countries 2. Canola Seeds – Japan, Mexico, United Arab Emirates,– combined equal China 3. Fescue – Trade Mission to Oregon Seed Conference 4. Alfalfa Seeds – Idaho purchased $27M for forge for cattle and horses. A good will crew from the Northwest should go to Idaho and take them out to lunch! 5. Fresh Beef - High-end Restaurants in California 6. Organic Oats – Japan and South Korea – Product Usage? 7. Northwest Timothy Hay Producers - Invite Japanese Ranchers to Peace Country 8. Air Cargo – Premium Prices for Fresh Meat– High-end Buyers? Japan and France

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Purpose of the Report

This report is one of three available under this report series.

Northwest Alberta – Agriculture

Northwest Alberta – Oil & Gas

Northwest Alberta – Forestry

This research project is about data collection.

Data collection relevant to the to the agricultural, forestry, and energy commodities of Northwest Alberta that are sold to the international markets.

What are the agricultural, forestry, and energy commodities of Northwest Alberta, how much is produced in Northwest Alberta, where are the commodities being exported, and the mode of transportation used for export.

Answering these questions is the purpose of this report.

The tables and charts presented within this report not only set baselines for comparisons and analysis they also represent real economic activity outcomes. How much is produced, how much is sold, and can we identify market development opportunities as we review the data?

Funding for this research project was received from the

Government of Alberta under the Community and Regional

Economic Support (CARES) program; as such this report is

available at no charge to the public.

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This research project covers the Northwest area of Alberta, circled on the map below. This area is serviced the Peace Region Economic Development Alliance (PREDA) and the Regional Economic Development Initiative (REDI). Collectively these two economic alliances service 13 rural municipalities that represent 4918 farms owned by farmers caretaking for 6.4 million acres of farmland. The information collected in this report is for them.

Northwest Alberta

REDI and

For more information on REDI or PREDA

https://communityeconomicdevelopment.alberta.ca/regional-economic-development-alliances-redas/

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SECTION 1 - SETTING THE STAGE

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SECTION 1 - Setting the Stage

Global Trade is the exchange of capital, goods, and services across international borders or territories. In most countries, such trade represents a significant share of gross domestic product (GDP). Carrying out trade at an international level is a complex process when compared to domestic trade. When trade takes place between two or more nations factors like currency, government policies, economy, judicial system, laws, and markets influence trade.

To smoothen the process of trade between countries of different economic standing, international economic organisations were formed, such as the World Trade Organization. These organisations work towards the facilitation and growth of international trade. Statistical services of intergovernmental and supranational organisations and national statistical agencies publish official statistics on international trade.

To facilitate the exchange of information the Harmonized Commodity Description and Coding System (HS) was developed; an internationally standardized system of names and numbers to classify traded products. It came into effect in 1988 and has since been developed and maintained by the World Customs Organization (WCO). The HS coding system has multiple levels of description for international comparisons. The lowest level of detail is Level 2; the highest level of detail is Level 6. For example, forestry products (Level 2) vs Oriented Strand Board – Softwood (Level 6).

NOTE: Sources of information are identified throughout the report. All data is referenced to 2017 to facilitate comparisons at the local, national, and global levels. It typically takes a year or more for hierarchal levels of data to be cross-comparable. For example, grain production is ready at the latest in November of a crop year. The export data is not completed and summarized for that same year until July of the following year. The production / export is then loaded into a national database, which is then shared with a global database. Overall it takes almost two years before all levels (provincial, national & global) are comparable in reference to the original production amounts. The original datasets accessed for this report are referenced through-out the report specially to assist local Economic Development Officers in updating the included charts quickly if the information is pertinent to a project they are working on.

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The graphic shows a summary of the 2017 export -import international trade balances. As shown Germany, Japan and China export much more than they import (in monetary terms).

Note that Canada is a net-importer; we buy more than we sell on the global trade market.

Note also the United States, is the biggest net-importer in the world. The United States is currently reviewing all trade deals and pushing for more manufacturing and production within its own country to address trade imbalances.

Politics of Trade Balances

China, which exports electronics and metals but also cheap consumer goods, is embroiled in a trade war over its trade imbalance which is especially pronounced in its relationship with the United States, the biggest net importer in the world. Germany, a big exporter of machinery and cars, is also earning much more through exports than it spends on imports, much to the disdain of the European Union, which put the country on notice about its trade surplus and demanded investments, wage hikes and lower taxes. This is supposed to bolster demand at home and give trade partners with a weaker performance the chance to export to Germany and improve their own economy, according to the EU.

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The table below shows Canada paid $CA 561.4 Billon for imports in 2017. There were 106 countries recorded on Canada import transactions in 2017. Yet, the top seven countries accounted for 79.73% of all Canada’s imports in the year 2017.

Canada 2017 Imports – Top 25 Products HS 6 Product Description $CA Note the 870323 Motor Vehicles - Spark Ignition - Cylinder Capacity 1501-3000 Cc 17,840,209,000 significant 270900 Crude Petroleum Oils and Oils Obtained from Bituminous Minerals 16,591,141,000 870324 Motor Vehicles - Spark Ignition - Cylinder Capacity More than 3000 Cc 14,186,123,000 amount of money 870431 Trucks - Spark Ignition - Load Not Exceeding 5 Tonnes 13,979,491,000 271012 Light Oils and Preparations 10,759,364,000 Canada paid for 300490 Medicaments Nes - in Dosage 7,405,357,000 imports of Crude 851712 Telephones For Cellular Networks or For Other Wireless Networks 7,193,986,000 870829 Parts and Accessories of Motor Vehicle Bodies Nes 7,069,935,000 Oil. The details 710812 Gold in Unwrought Form (Non-Monetary) 7,055,592,000 of these imports 840734 Reciprocating Piston Engines For Road or Off-Highway Motor Vehicles 5,888,927,000 271019 Petroleum Oils and Oils from Bituminous Minerals, O/T Crude, O/T Light, 5,165,555,000 are presented in 847130 Portable Automatic Data Processing Machines, With CPU, Keyboard 4,965,509,000 the Oil & Gas 851762 Machines F R/C/T or Reg of Voice, Images or Data, Switching 4,895,060,000 870899 Motor Vehicle Parts, Nes 4,841,547,000 component of this 880330 Parts of Airplanes or Helicopters Nes 3,959,881,000 report series. 870840 Gear Boxes (Transmissions), For Motor Vehicles and Parts Thereof 3,651,258,000 841191 Parts of Turbojets or Turbo-Propellers 3,420,644,000 271121 Natural Gas in Gaseous State 3,415,226,000 880240 Aircraft Nes of An Unladen Weight (More than 15,000 Kg) 3,223,363,000 870120 Road Tractors For Semi-Trailers (Truck Tractors) 2,769,254,000 848180 Taps, Cocks, Valves and Other Similar Appliances, Nes 2,685,911,000 847150 Process Units O/T 8471.41/.49, W/N Cntg in Same Hsng: 2,623,216,000 940190 Parts For Seats 2,339,756,000

870830 Brakes and Servo-Brakes, For Motor Vehicles; Parts Thereof 2,277,147,000 848340 Gears and Gearing; Ball or Roller Screws; Gear Boxes, Speed Changers 2,260,298,000 Sub-total 160,463,749,000 Other Products 400,947,510,000 Total Imported Products $561,411,259,000

Source: Trade Data – Industry Canada

Canada 2017 Imports – Top 7 Countries United States 51.35 % China 12.63% Mexico 6.32% Germany 3.19% Japan 3.12% United Kingdom 1.59% Korea, South 1.53% Total 79.73%

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Exports: The focus of this research project is exports.

The graph below shows the monetary value of Canadian exports from 2013 to 2017.

Source: Trade Data – Industry Canada

In 2017 Canada generated $546 Billion exporting its goods and services. A fraction of the total export revenues generated among the 238 countries exchanging products from the almost 5000 HS codes used to describe these products.

Source: Trade Data – Industry Canada, and World Trade organization

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In 2017 Canada exported 4378 types of products (international Harmonized Coding System) to 222 countries. Though it sounds like Canada has a diversified trade partner portfolio, this is not the case. The United States accounted for 76% of Canada’s $CA 546 Billion export revenues in 2017.

$CA Canada 2017 Export Revenues – Top 25 Products Millions % US $546,456 Total - All Products – HS Code – Level 2 75.9% $109,773 27 - Mineral Fuels, Mineral Oils, Bituminous Substances and Mineral Waxes 91.0% $80,918 87 - Motor Vehicles, Trailers, Bicycles, Motorcycles and Other Similar Vehicles 93.1% $41,978 84 - Nuclear Reactors, Boilers, Machinery and Mechanical Appliances 75.8% $24,494 71 - Pearls, Precious Stones or Metals, Coins and Jewelry 28.0% $18,277 44 - Wood and Articles of Wood (Incl. Wood Charcoal) 76.7% $16,758 85 - Electrical or Electronic Machinery and Equipment 74.8% $16,319 39 - Plastics and Articles Thereof 90.5% $12,891 88 - Aircrafts and Spacecrafts 49.3% $12,736 76 - Aluminum and Articles Thereof 87.1% $10,199 12 - Oil Seeds, Oleaginous Fruits, Industrial or Medicinal Plants, Straw and Fodder 8.9% $9,347 48 - Paper, Paperboard and Articles Made From These Materials 84.3% $9,085 26 - Ores, Slag and Ash 0.0% $8,668 90 - Optical, Medical, Photographic, Scientific and Technical Instrumentation 63.4% $8,624 72 - Iron and Steel 83.1% $8,281 47 - Pulp of Wood and The Like; Waste and Scrap of Paper or Paperboard 30.2% $8,158 30 - Pharmaceutical Products 66.1% $8,131 10 – Cereals (wheat, rye, oats, etc...) 19.8% $7,442 94 - Furniture, Lamps and illuminated Signs, Prefabricated Buildings 94.7% $6,505 02 - Meat and Edible Meat Offal 49.0% $6,418 73 - Articles of Iron or Steel 88.7% $6,226 03 - Fish, Crustaceans, Mollusks and Other Aquatic Invertebrates 59.9% $5,908 31 - Fertilizers 60.7% $5,831 07 - Edible Vegetables and Certain Roots and Tubers 45.0% $4,606 29 - Organic Chemicals (Including Vitamins, Alkaloids and Antibiotics) 72.4% $4,434 28 - Inorganic Chemicals and Compounds of Precious Metals and Elements 78.7% Source: Industry Canada – Trade Data

Note: Canada's economic integration with the United States has increased significantly since WW2. The Automotive Products Trade Agreement of 1965 opened Canada's borders to trade in the automobile manufacturing industry. In the 1970s, the federal government enacted the National Energy Program (NEP) and the Foreign Investment Review Agency (FIRA). In the 1980s, NEP was abolished and FIRA was renamed to Investment Canada. The Canada-United States Free Trade Agreement (FTA) of 1988 eliminated tariffs between the two countries, while the North American Free Trade Agreement (NAFTA) expanded the free-trade zone to include Mexico in 1994. In 2018 NAFTA was renegotiated and is now called the United States-Mexico-Canada Agreement (USMCA).

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The $546 Billion of export revenues generated by Canada’s sale of its products on the global market reflects the summary of all the export activity coming out of each province and territory.

Canada 2017 Export Revenues – By Province and Territory (CA$ - Billion) Ontario 241.7 44.1% Alberta 101 18.4% Quebec 85 15.6% British Columbia 45 8.2% Saskatchewan 29 5.3% Manitoba 14 2.6% New Brunswick 13 2.3% Newfoundland and Labrador 10 1.9% Nova Scotia 6 1.0% Northwest Territories 2 0.3% Prince Edward Island 1 0.3% Nunavut 0.3 0.1% Yukon 0.1 <0.1% All Jurisdictions 546.3 100% Source: CANADA'S STATE OF TRADE- Global Affairs Canada (2018)

“The top three exporting provinces – Ontario, Alberta and Quebec – accounted for 78 percent of Canada’s export revenues in 2017. Ontario was the only province whose exports declined; Automotive exports were the main culprit (down 5.8 %). Alberta’s exports “valued at 101 billion” (up 26.4 percent), restoring it to the second rank among Canada’s exporter jurisdictions. Exports of energy products were driving Alberta’s growth, while in Quebec mechanical machinery and aluminum were key. “British Columbia, coal and gas exports caused most of the increase. Saskatchewan’s exports grew 8.5 percent (up $2.3 billion) while Manitoba’s exports inched up 2.8 percent (up $0.4 billion). Further down the rankings, New Brunswick showed remarkable growth of 20.4 percent (up $2.2 billion), matched and exceeded by Newfoundland and Labrador with 20.7 percent (up $1.7 billion). Energy exports were behind both increases, though ores helped as well in the case of Newfoundland and Labrador. Nova Scotia’s exports grew modestly by 2.4 percent (up $0.1 billion), while Northwest Territories expanded exports by 30.2 percent due to higher diamond exports. Yukon’s main export, copper ores, halved their (and the territory’s) exports, while Nunavut reported major exports ( gold) for the first time.”

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Alberta Exports

150 2014 - 2017 Alberta Export Revenues CA$ Billions

122 93 100 80 101

0 2014 2015 2016 2017

Source: Industry Canada – Trade Data

In 2017 Alberta generated $101 Billion in revenues from international exports with 193 countries. The table below presents the top ten export countries for Alberta, the export revenues generated from that country in 2017, and the number one product Alberta sold to that country.

Alberta 2017 – Export Revenues ($101 Billion) – By Country ($CA) Country Export $ Top Product Sold Country Export $ Top Product Sold USA 88 Billion Oil and Gas Extraction UAE 279 Million Oilseed (Canola) China 3.9 Billion Oilseed (Canola) Indonesia 269 Million Wheat Japan 1.7 Billion Oilseed (Canola) France 250 Million Oilseed (Canola) Mexico 1.3 Billion Petroleum Refineries India 230 Million Dry Pea and Bean Korea, South 419 Million Animal Slaughtering Australia 227 Million Inorganic Chemical Source: Industry Canada – Trade Data

With 193 trading partners one would think Alberta has quite diverse trading relations on the global markets. However, like Canada, this is not the case.

The United States accounted for 88.5% of Alberta’s

$CA 101 Billion export revenues in 2017.

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The following table shows Alberta’s top 25 export products (at HS Level 6 – most detailed) and the percentage of these sales that were sold to the United States. Of interest to this research report are the products that are mostly sold to the United States and whether these products are produced in the Northwest.

US Percent Total AB 2017 of AB Alberta 2017 Export Revenues – Top 25 Products Export 2017 Export HS Code – Level 6 ($CA) Revenues Revenues Total – 2017 Export Revenues $101,484,429,047 88.5% 270900 - Crude Petroleum Oils and Oils Obtained from Bituminous Minerals $59,573,782,874 99.9% 271121 - Natural Gas in Gaseous State $7,373,907,554 100.00% 120510 - Rape or Colza Seeds - Low Erucic Acid (Whether or Not Broken) $2,031,177,111 4.61% 100199 - Meslin and Wheat Nes: Other $1,806,826,046 12.21% 271112 - Liquefied Petroleum or Hydrocarbon Gases - Propane $1,562,642,935 88.24% 290531 - Ethylene Glycol (Ethanediol) $1,431,995,468 40.43% 390140 - Ethylene-alpha-olefin copolymers, gravity of less than 094 $1,410,963,957 92.56% 390190 - Polymers of Ethylene Nes, in Primary Forms $1,152,068,054 91.54% 020130 - Bovine, Cuts Boneless - Fresh or Chilled $1,094,941,844 90.87% 271019 - Petroleum Oils and Oils from Bituminous Minerals, O/T Crude / Light, $1,064,033,541 82.84% 440710 - Lumber (Thickness >6Mm) - Coniferous Wood $1,008,226,204 88.97% 390120 - Polyethylene - Specific Gravity of 0.94 or More $992,920,305 85.21% 151411 - Rape (Canola) or Colza Oil - Low Erucic Acid - Crude $852,494,768 29.49% 470321 - Chemical Wood pulp - Soda or Sulphate - Coniferous, Bleached $711,526,156 62.36% 010229 - Cattle, Other $612,082,753 99.92% 441012 - Oriented Strand Board (Osb), of Wood $555,942,990 99.82% 281410 - Ammonia - Anhydrous $475,715,960 100.00% 271012 - Light Oils and Preparations (petroleum) $461,555,367 100.00% 390110 - Polyethylene - Specific Gravity of Less than 0.94 $428,460,769 84.63% 290250 - Styrene $417,405,852 100.00% 470329 - Chemical Woodpulp - Soda or Sulphate - Non-Coniferous, Bleached $413,781,280 57.01% 470500 - Semi-Chemical Wood Pulp $407,309,934 4.05% 230641 - Oil-Cake - of Low Erucic Acid Rape (Canola) or Colza Seeds $400,038,294 70.03% 750210 - Nickel - Unwrought, Not Alloyed $388,751,905 0.00% 100119 - Durum Wheat: Other $321,829,494 16.90% Other Products $14,534,047,632 Source: Industry Canada – Trade Data

“We produced 3.9 million barrels per day of oil and 15.2 billion cubic feet per day of natural gas, 99 % of our oil exports and 100 % of our natural gas exports goes to the U.S.”

Source: Canadian Association of Petroleum Producers

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Alberta Trade with the US

Reflecting 88.5% of all of Alberta’s export revenues in 2017; the United States is a critical export market for the Province. The table below shows the distribution by state of the $88.5 Billion generated from exports to the US. The top states largely reflect the transfer nodes of the transmission lines for the oil & gas industry. Alberta’s trade with the United States and how this volume and monetary value is distributed across the States will be detailed in the Sector sections of this report.

2017 Percent of AB 2017 Percent of AB 2017 Export 2017 US State Revenues $CA US State Export Revenues $CA Illinois 29.36 $ 29,794,403,931 South Carolina 0.28 $ 279,997,446 Texas 10.49 $ 10,649,919,966 Florida 0.27 $ 277,850,119 Washington 7.48 $ 7,589,286,128 Kansas 0.27 $ 277,701,301 Minnesota 5.67 $ 5,753,997,509 Georgia 0.27 $ 271,413,851 Michigan 5.63 $ 5,717,371,300 Kentucky 0.26 $ 262,244,257 Colorado 3.19 $ 3,241,844,279 North Carolina 0.24 $ 242,105,436 Montana 2.84 $ 2,881,037,795 Alaska 0.21 $ 214,447,377 Oklahoma 2.54 $ 2,573,243,443 Nevada 0.2 $ 198,607,863 California 2.49 $ 2,528,887,420 Arizona 0.16 $ 163,337,777 New York 2.32 $ 2,355,278,347 Tennessee 0.16 $ 158,619,574 Ohio 1.91 $ 1,943,293,176 South Dakota 0.13 $ 128,963,907 Pennsylvania 1.42 $ 1,444,909,492 Vermont 0.12 $ 126,411,194 Louisiana 1.07 $ 1,089,257,445 Nebraska 0.12 $ 119,116,514 Missouri 0.93 $ 946,097,726 Mississippi 0.11 $ 112,458,925 Wisconsin 0.9 $ 915,784,336 Virginia 0.1 $ 106,521,946 North Dakota 0.63 $ 641,361,431 Connecticut 0.06 $ 56,432,961 Wyoming 0.6 $ 605,108,672 Arkansas 0.05 $ 55,561,234 Delaware 0.56 $ 567,715,539 Maryland 0.05 $ 51,450,766 Idaho 0.53 $ 534,873,986 West Virginia 0.04 $ 43,929,282 Iowa 0.51 $ 520,088,868 Maine 0.04 $ 43,830,993 Oregon 0.51 $ 518,480,421 Hawaii 0.03 $ 34,248,734 Alabama 0.48 $ 489,627,128 New Mexico 0.02 $ 25,156,100 Massachusetts 0.46 $ 465,229,662 Rhode Island 0.02 $ 15,267,653 Utah 0.4 $ 402,124,132 New Hampshire 0.02 $ 15,227,626 New Jersey 0.33 $ 338,573,166 Dis. of Columbia <.01 $ 1,264,208 Indiana 0.29 $ 299,145,270 Source: Industry Canada – Trade Data

“The first rule of thumb for trade is proximity. The closer you are the more likely it is there will be trade; especially if you both have something the other wants.” Source: “Gravity Model of Trade”- Foreign Affairs Canada

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Section 1 - Comments

Canada has vast natural resources. Who we sell these natural resources to, how much money we receive, and under what conditions is a matrix of variables like trade agreements, supply & demand, and cost of delivery? In our global economy the successful international exchange of goods and services (exports and imports) is also measured against benchmarks like trade balances; tariffs, and geo-political relations.

Global, federal, and provincial datasets are collected by numerous agencies. Canada contributes annual summaries of export revenues to international agencies. Alberta contributes to the annual summaries of export revenues reported by Industry Canada. Determining how much of Alberta’s export revenues are generated in the Northwest? This is where it gets tricky. There is no master dataset available that directly links Northwest Alberta sales of agriculture, forestry, or energy products to federal or provincial annual export revenues.

At minimum we want to “benchmark”. To do this, a wide variety of regional level economic activities are reviewed for analysis in this report. Each sector – agriculture, forestry, and energy – will have vastly different information sources. For example, in the agricultural sector, information on the number of grain-loaded rail cars leaving the region will be reviewed; in the forestry sector we will review industry level Forestry Management Agreements to determine the volume of wood available in Northwest Alberta; in the energy sector we will identify the collection and transmission data at the gathering stations.

Because of the diverse and numerous information sources accessed to provide an overall synopsis of the primary commodities produced in Northwest Alberta the report is presented in three distinct sub-reports – Northwest Alberta Agriculture; Northwest Alberta Energy and Northwest Alberta Forestry. For each sub-report the fundamental questions remained at the forefront: 1) what commodities are produced; 2) how much is being produced; 3) where the commodity is sold outside of Canada; and the mode of transport to deliver the commodity.

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SECTION 2 - AGRICULTURE

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Northwest Alberta – Agriculture Commodities September 2019 Land Use Type

Northwest Alberta is an agriculturally rich area. Though the region represents a small part of all of Canada’s farmland, the agricultural products grown and bred in this region are renowned for their superior quality. There were 193,650 farms counted in Canada’s 2016 Census of Agriculture.

Less than 3% of Canada’s farms are in Northwest Alberta.

Number of Farms - By Type

Other crop farming [1119] Greenhouse, nursery and floriculture [1114] Fruit and tree nut farming [1113] Vegetable and melon farming [1112] Oilseed and grain farming [1111] Other animal production [1129] Sheep and goat farming [1124] Poultry and egg production [1123] Hog and pig farming [1122] Cattle ranching and farming [1121]

0 10,000 20,000 30,000 40,000 50,000 60,000 70,000

NW-AB AB Canada

Source: Statistics Canada - 2016 Census of Agriculture

Northwest Canada AB AB Total number of farms 193,492 40,638 4,918 Cattle ranching and farming [1121] 46,538 12,693 890 Hog and pig farming [1122] 3,305 166 8 Poultry and egg production [1123] 4,903 373 20 Sheep and goat farming [1124] 3,056 399 30 Other animal production [1129] 19,792 5,101 556 Oilseed and grain farming [1111] 63,628 13,451 2,026 Vegetable and melon farming [1112] 5,514 299 22 Fruit and tree nut farming [1113] 7,845 137 19 Greenhouse, nursery and floriculture [1114] 6,449 605 32 Other crop farming [1119] 32,462 7,414 1,315 Total number of farms 193,492 40,638 4,918

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Of the more than 158 million acres dedicated to farmland in Canada;

59% is dedicated to crops.

Canada Farmland Use - Acres 2016

Other 17,543,740

Pasture 47,796,714

Crops 93,382,638

Farmland in Northwest Alberta is listed below. The County of Grande Prairie has the largest number of acres of farmland; while the MD of Peace has the smallest number of acres.

Source: Statistics Canada – 2016 Census of Agriculture

Northwest Alberta 2016 Agricultural Land Inventory – By Type (Acres) Crop Land Fallow Pasture Land All Other * Total Canada 93,382,638 2,209,071 47,796,714 15,334,669 158,723,092 Alberta 25,261,781 644,021 21,283,021 3,061,360 50,250,183 NW-AB 3,934,383 83,262 1,683,854 752,817 6,454,316 N. Sunrise 171,297 973 64,529 52,249 289,048 Big Lakes 157,412 4,018 152,173 56,876 370,479 Clear Hills 271,381 6,399 185,916 61,262 524,958 N. Lights 347,053 7,624 130,907 71,194 556,778 Mackenzie 371,972 21,751 87,654 114,271 595,648 Greenview 293,024 8,495 277,991 74,196 653,706 County GP 591,167 15,052 330,811 121,060 1,058,090 Smoky River 545,973 3,393 46,738 37,998 634,102 Birch Hills 323,869 3,457 106,785 29,149 463,260 Spirit River 134,824 2,344 15,482 12,430 165,080 Saddle Hills 344,404 6,326 121,424 63,125 535,279 Fairview 233,276 1,229 40,114 23,405 298,024 Peace 107,084 1,117 68,125 14,471 190,797 Source: Statistics Canada - 2016 Census of Agriculture – Custom Request by Municipality

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Northwest Alberta – Agriculture Commodities September 2019

Cropland – Exports The table below shows the acres of cropland that are dedicated to the principle field crops grown in the rural municipalities in Northwest Alberta. The largest number of acres is dedicated to Canola, then wheat, alfalfa, and dry field peas. Collectively the 11 crops below represent 99.5% of the crop-land usage in the Northwest

( 3,912,852 acres of the 3,934,383 acres in the crop-land inventory shown in the previous table for the Northwest).

Source: Statistics Canada – 2016 Census of Agriculture – Custom Request by Municipality

Northwest Alberta 2016 Agricultural Land Inventory – Crops (Acres) Canola Wheat Alfalfa Dry Field Barley Tame Hay Oats Forage Mixed Rye Corn and Peas Fodder Seeds Grains Mixes Canada 20,606,778 23,436,513 9,276,755 4,291,872 6,696,068 4,851,167 3,159,68 408,023 509,698 411,18 4,563,24 7 9 8 Alberta 6,165,746 7,008,542 3,056,701 1,909,491 3,413,856 1,161,521 822,185 164,070 242,206 67,215 241,151 NW-AB 1,293,166 948,882 459,467 432,825 263,288 204,012 192,481 91,277 15,670 6,094 5,690 N. Sunrise 71,533 55,349 9,867 15,431 5,648 7,373 2,521 3,102 450 0 0 Big Lakes 38,843 29,340 27,583 6,925 8,617 32,814 6,603 5,276 x 821 265 Clear Hills 43,061 46,722 46,918 63,360 20,883 19,441 21,311 5,315 2,940 340 x N. Lights 109,552 92,300 45,851 x 31,541 17,885 14,006 4,468 x x 195 Mackenzie 118,761 68,991 33,505 50,299 24,231 9,273 52,983 x 2,649 x 1,089 Greenview 79,474 57,714 49,491 13,496 17,914 32,822 20,410 17,881 653 x 820 County GP 156,661 109,731 123,235 42,233 73,873 39,224 23,207 17,363 1,900 975 214 Smoky River 259,729 194,602 7,689 48,672 16,940 4,336 3,734 6,784 0 x 580 Birch Hills 149,018 82,982 17,053 41,159 25,842 3,081 3,557 700 x 0 x Spirit River 45,252 32,390 5,812 30,525 7,492 3,765 5,046 901 x x 0 Saddle Hills 78,833 81,914 55,547 48,325 17,269 19,165 23,632 15,622 1,340 250 480 Fairview 99,265 66,825 17,149 21,561 7,440 5,027 6,341 6,434 854 x x Peace 35,335 22,505 8,061 22,253 3,559 5,596 4,324 2,780 615 x 169

NOTE: Northwest Alberta is located within an agricultural region referred to as the Peace Country. This region includes the northern eastern section of British Columbia. This report does not include the BC-Peace region.

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Principle Field Crops – Production

Field Crops: Cereal grains and oilseeds are a huge component of the agricultural industry in Canada. These crops are monitored by the Canadian Grain Commission; a federal government agency responsible for regulating grain handling in Canada and certifies the quality, safety and quantity of export shipments of Canadian grain. The table below shows the principle food crops and the volume produced in Canada, Alberta, and Northwest Alberta.

Canada and Alberta – Principle Grains and Oils Seeds - Production (Metric Tonnes) CANADA ALBERTA Type of crop 2015 2016 2017 2015 2016 2017 Barley 8,256,600 8,839,400 7,891,300 4,289,200 4,398,000 3,906,000 Canola 18,376,500 19,599,200 21,328,100 5,851,300 6,157,500 6,826,600 Oats 3,425,000 3,231,200 3,733,000 393,300 624,600 609,200 Peas, dry 3,200,700 4,835,900 4,112,200 1,314,500 2,271,200 1,991,500 Wheat, 27,647,400 32,139,900 30,377,200 8,290,000 10,106,700 9,980,100 Source: Statistics Canada - Estimated areas, yield, production Table: 32-10-0359-01

The table shows the number of acres that were harvested in 2017 and the total production for these field crops in Northwest Alberta. Combined these five crops represent 75% of the cropland usage in the Northwest.

Northwest Alberta – 2017 Major Food Grade - Field Crops Harvested Production Acres Metric Tonnes Barley 179,500 265,900 Canola 1,378,700 1,296,900 Oats 150,800 197,700 Peas, dry 348,900 399,400 Wheat, all 868,900 1,162,200 Total 2,926,800 3,332,500

Source: Statistics Canada - Estimated areas, yield, production Table: 32-10-0359-01

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One of the first benchmarks to assess how much of the principle field crops production is exported is to review the volumes that are delivered to the primary grain elevators in the region. These facilities, a component of the Grain Handling System across Canada, are the iconic community located grain towers.

Primary an elevator the principal use of which is the receiving of grain directly from producers for either or both storage and forwarding. There are 357 primary elevators in Canada; 83 are in Alberta. Terminal an elevator whose principal uses are the receiving of grain from another elevator and the cleaning, storing and treating of the grain before it is moved forward to export. There are 32 terminal elevators in Canada; there are none in Alberta. Producer Loading: Under the Canada Grain Act, grain producers are entitled to order producer railway cars through the Canadian Grain Commission to ship any grain designated as such under the Canada Grain Act. Producer railway cars are used to ship grain directly to a destination and provide producers a delivery alternative to the licensed grain handling system. Process an elevator the principal use of which is receiving and storing of grain for direct manufacture or processing into other products. There are 44 process elevators in Canada; 10 are in Alberta. There are no process elevators in Northwest Alberta, yet these facilities play a critical intermediate step in the value added to raw grains. Whether it be crushing canola into oil, malting barley for the beer industry, or turning raw oats into oatmeal; the value added is significant. Being aware of where these facilities are located and how much of the Northwest’s grains are shipped to these facilities is an important element of this report.

Process Elevators in Canada – Feb 2019 Province Community Company Province Community Company AB Alix Rahr Malting Canada Ltd. SK Belle Plaine Terra Grain Fuels Inc. AB Calgary ADM Agri-Industries Company SK Bellevue Belle Pulses Ltd. AB Calgary Canada Malting Co. Limited SK Biggar Cargill Limited AB Camrose Cargill Limited (1) SK Clavet Cargill Limited (1) AB Duagh Canadian Oats Milling Ltd. SK Dalmeny Richardson Milling Limited AB Fort Sask Bunge Canada SK Duck Lake Belle Pulses Ltd. AB Lethbridge Richardson Oilseed Limited SK Indian Head PATERSON GRAIN/ GlobalFoods AB Lloydminster ADM Agri-Industries Company SK Lanigan Pound-Maker Agventures Ltd. AB Manola Richardson Milling Limited SK Lloydminster Husky Oil Limited AB Red Deer Permolex Ltd. SK Nipawin Bunge Canada BC Armstrong Gambrinus Malting Corporation SK Regina CanMar Foods Ltd. MB Altona Bunge Canada SK Regina Oleet Processing Ltd. (1) MB Elie Prairie Flour Mills Ltd. SK Regina Oleet Processing Ltd. (6) MB Harrowby Bunge Canada SK Regina East Avena Foods Limited MB Macgregor Prairie Flax Products Inc. SK Richardson PATERSON GRAIN,/ GlobalFoods MB Minnedosa Husky Oil Limited SK Rowatt Best Cooking Pulses / Avena Foods MB Portage La P Richardson Milling Limited SK Saskatoon Ardent Mills ULC MB Russell 2712270 DBA Pizzey Ingredients SK Saskatoon Parrish & Heimbecker, Limited MB Ste Agathe Viterra Inc. SK Yorkton Grain Millers Canada Corp. MB Ste Anne Natural Proteins Inc. SK Yorkton Louis Dreyfus Company MB Winnipeg ADM Agri-Industries Company SK Yorkton Richardson Oilseed Holdings MB Winnipeg Malteurop Canada Ltd. ON Thunder Bay Canada Malting Co. Limited

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The table below shows the volume of principle grains (relative to Alberta) that were delivered to the process elevators across Canada.

Deliveries to Process Elevators 2017-2018 Process elevators appear to very under- (Thousand Metric Tonnes) utilized, not just in Alberta but across Canada. BC AB SK MB Total Barley 12.7 385.6 84.8 151.4 634.6 Considering, for example that Canada

Wheat 108.3 784.6 41 933.8 produced 21Million metric tonnes of Wheat - yet less than 1M goes through these facilities Oat 1.7 245.1 33.7 280.4 - for upgrading to higher-level products.

Rye 12.1 12.1 - - -

Canola 2,199.80 3,906.60 975.7 7,082.10 -

The table below shows the location of the primary elevators in the Northwest and the percentage of the

2017 principle field crops production that was shipped out of the Northwest using these facilities.

Northwest Alberta – Deliveries to Primary Elevators 2017-18 Metric Tonnes NW Alberta Production 1,162,200 197,700 265,900 1,296,900 399,400 Delivery Point / Crop Wheat Oat Barley Canola Peas NAMPA 131.9 - 3.1 166.8 14.8 RYCROFT 234.1 - 23.8 402.0 133.9 HIGH LEVEL 56.7 - 3.7 56.2 21.5 SMOKY RIVER 139.0 0.1 13.6 160.2 40.3 SEXSMITH 166.5 - 64.0 134.8 63.3 MCLENNAN 151.8 - - 132.0 20.0 FALHER 34.7 - - - 23.7 GRIMSHAW 108.9 - 50.4 173.1 73.5 Total Delivered 1,023,700 100 158,700 1,225,000 391,100 % Delivered 88% <1% 60% 94% 98%

Source: Canadian Grain Commission

Deliveries to primary grain elevators shows that most of the production of the Canola, Wheat, and Dry Field Peas produced in the Northwest is accounted for under the delivery volumes to the primary elevators in the region. For barley, approximately 40% of production did not go through the primary elevators. And Oats – pretty much nothing goes

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through the primary elevator system. This is not uncommon for most of the Oats produced in Alberta. Oats production has two other major uses that are not captured through the elevator system. Use domestically on local farms as feed, and/or exported as “Pony Oats” to exclusive horseracing / horse owners in the United States.

Alberta export revenues from the sale of plant products, which includes all cereal grains and oil seeds, reached $ 5.3 Billion in 2017. Overall the US accounts for only 15.3% of all export revenues in 2017 for this product category. The table below shows the export revenues for Alberta for plant products. Highlighted are the HS Coded products of importance to the Northwest. Note the US is a major importer for four of the eight products highlighted. $CA Percent Alberta 2017 Export Revenues – All Plant Products and Vegetables Sold to US All Countries $ 5,351,691,802 15.3% HS 1001 - Wheat $ 2,132,003,792 12.9% HS 120510 - Rape or Colza Seeds - Low Erucic Acid (Whether or Not Broken) $ 2,031,177,111 4.6% HS 0713 - Leguminous Vegetables - Dried and Shelled $ 307,083,320 16.0% HS 1107 - Malt $ 240,261,404 45.5% HS 1003 - Barley $ 197,042,331 13.0% HS 121490 - Swedes, Mangolds, Hay, Clover, Sainfoin, Forage Kale, Pellets $ 101,705,476 15.4% HS 0701 - Potatoes - Fresh or Chilled $ 44,289,804 100.0% HS 1104 - Cereal Grains - Hulled, Rolled, Flaked, Pearled, Sliced, Kibbled; Germ $ 37,557,091 71.9% HS 1201 - Soya Beans, Whether Broken $ 31,654,071 0.1% HS 120921 - Seeds of Forage Plants: Lucerne (Alfalfa) Seeds $ 30,895,336 94.3% HS 120923 - Seeds of Forage Plants: Fescue Seeds $ 29,403,984 89.9% HS 1004 - Oats $ 28,786,882 93.4% HS 1103 - Cereal Groats, Meal and Pellets $ 28,317,314 78.2% HS 1204 - Linseed $ 27,558,320 27.2% HS 1207 - Other Oil Seeds and Oleaginous Fruits $ 17,740,467 57.4% HS 120929 - Seeds of Forage Plants, Except Beet Seeds, For Sowing, Nes $ 12,171,913 67.9% HS 1302 - Vegetable Saps and Extracts; Pectic Substances; Agar-Agar $ 9,451,006 79.4% HS 1101 - Wheat or Meslin Flour $ 8,119,761 82.5% HS 1109 - Wheat Gluten, Whether Dried $ 6,982,483 100.0% HS 121410 - Lucerne (Alfalfa) Meal and Pellets $ 6,431,640 100.0% HS 0707 - Cucumbers and Gherkins - Fresh or Chilled $ 4,112,288 100.0% HS 1002 - Rye $ 3,491,857 94.4% HS 120590 - Rape or Colza Seeds - Other Nes (Whether or Not Broken) $ 3,328,293 82.0% HS 1211 - Plants Primarily in Pharmacy, Perfumery, Insecticides, Fungicides $ 2,462,164 20.4% HS 1108 - Starches (Inulin) $ 2,137,939 100.0% HS 0702 - Tomatoes - Fresh or Chilled $ 1,475,056 100.0% All Other Products $ 6,050,699 62.%

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WHEAT VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Wheat is a grass widely cultivated around the world for its seed, a cereal grain which is a worldwide staple food. There are numerous varieties of wheat on Alberta 2017 Export Revenues ($CA) Wheat – By Country the global market and numerous global exporters of United States $ 275,994,065 th Japan $ 202,996,888 wheat. Note that Canada ranks 7 for the global Indonesia $ 200,206,767 production of wheat. Bangladesh $ 143,090,935 Peru $ 125,985,923 Top wheat producers Colombia $ 100,738,028 Millions of Nigeria $ 97,924,909 Country Vietnam $ 94,415,427 Tonnes Mexico $ 90,345,625 World 720

Algeria $ 89,281,248 European Union 157.3 China $ 72,853,620 Ecuador $ 60,284,657 China 126.2

Morocco $ 54,495,024 India 95.8 United Arab Emirates $ 50,085,481 Russia 59.7 Italy $ 45,603,363 United Kingdom $ 43,700,342 United States 55.1 Sri Lanka $ 37,828,417 France 39.0 Ghana $ 36,160,871 Canada 29.3 Philippines $ 27,180,513 Venezuela $ 25,454,600 Germany 27.8

Chile $ 24,483,971 Pakistan 26.0 Korea, South $ 19,888,715 Australia 25.3 Malaysia $ 19,840,977 Cuba $ 17,928,051 Ukraine 24.1 Brazil $ 16,021,698 Source: UN Food & Agriculture Organization Dominican Republic $ 15,679,438 Kenya $ 14,701,499 Global demand for wheat and wheat products continues Costa Rica $ 14,077,340 to increase. In 2000 global exports were at 558MMT; Thailand $ 12,847,307 Tanzania $ 11,470,975 in 2017 global exports rose to 782MMT. Mozambique $ 10,860,898 Cameroon $ 10,073,356 Turkey $ 8,053,084 Netherlands $ 7,738,145 Belgium $ 7,179,324 558 782 Haiti $ 6,170,416 Oman $ 5,103,389 Tunisia $ 4,995,614 All Others $30,262,892 2000 2017 Total All Countries $ 2,132,003,792

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WHEAT VERY IMPORTANT CROP IN NORTHWEST ALBERTA Transporting Wheat: Wheat produced in the Northwest is transported out of the Northwest region by rail. The table below shows 88% of the volume of wheat produced in the Northwest in the year 2017 was delivered to a grain terminal within the Northwest region.

Northwest Alberta – Deliveries to Primary Elevators 2017-18

Wheat Production 1,162,200 (Metric Tonnes)

Delivery Point

NAMPA 131.9

RYCROFT 234.1 HIGH LEVEL 56.7 SMOKY RIVER 139.0 SEXSMITH 166.5 MCLENNAN 151.8 FALHER 34.7 GRIMSHAW 108.9 1,023,700 Metric Tons Total Delivered to Elevators % of Production Delivered to Elevators 88%

Once the wheat from the Northwest reaches a juncture point where wheat from other regions are mixed, the intermodal transport begins to emerge depending on the point of export from Canada. In total, in 2017 there were 731 export shipments of wheat from Alberta to 35 countries. More than 400 of these shipments went to the United States, with Japan, Indonesia, and Bangladesh being the next top three importers of Alberta wheat. The following tables show the volumes delivered to each key importer, the primary mode of transport, and the value of each shipment. Also shown is the variety of wheat purchased.

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WHEAT VERY IMPORTANT CROP IN NORTHWEST ALBERTA

The tables below show that Alberta had nine export shipments of Wheat to Japan, seven export shipments to Indonesia, and two export shipments to Bangladesh in the year 2017. Note, by default ocean carriers are needed to get the product to the overseas buyer.

Alberta 2017 Export Revenues - Wheat to Japan Mode of Volume Wheat - Type Export Point Value $CA Transport Tonnes Durum wheat, certified organic, Vancouver Rail / Water 11 15,267 Durum wheat, Vancouver Rail / Water 33908 13,563,710 Durum wheat, Montréal Rail / Water 8432 2,452,425 Red spring wheat, certified organic, Vancouver Rail / Water 151 138,723 Red spring wheat, Prince Rupert Rail / Water 77763 29,665,449 Red spring wheat, Vancouver Rail / Water 424107 146,000,000 Red spring wheat, Vancouver Rail / Water 13599 4,369,564 Western red winter wheat, Vancouver Rail / Water 58 17,466 Wheat, and meslin (NES) Vancouver Rail / Water 24148 7,241,999 Total 582,177 $203,464,603

Alberta 2017 Export Revenues - Wheat to Indonesia Mode of Volume Wheat - Type Export Point Value $CA Transport Tonnes Durum wheat, Vancouver Rail / Water 3527 1296407 Red spring wheat, certified organic, Vancouver Rail / Water 109 37701 Red spring wheat, Prince Rupert Rail / Water 207132 65035393 Red spring wheat, Vancouver Rail / Water 389174 131422379 Red spring wheat, Vancouver Rail / Water 4310 1388413 Wheat, and meslin (NES) Prince Rupert Rail / Water 3364 958726 Wheat, and meslin (NES) Vancouver Rail / Water 205 67748 Total 607,821 $ 200,206,767

Alberta 2017 Export Revenues - Wheat to Bangladesh Mode of Volume Wheat - Type Export Point Value $CA Transport Tonnes Red spring wheat, Prince Rupert Rail / Water 164291 53,405,038 Red spring wheat, Vancouver Rail / Water 283102 89,685,896 Total 447,393 143,090,934

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WHEAT VERY IMPORTANT CROP IN NORTHWEST ALBERTA In 2017 the US generated the largest amount of export revenues from the sale of Alberta wheat and the largest number of export shipments.

Alberta 2017 Wheat Exports - USA There were 401 export shipments of Wheat from Alberta to the State Delivered Value $CA United States in the year 2017. One-hundred and twenty-eight Minnesota 41,618,669 New York 33,898,051 of these shipments were by rail reflecting 494,239 tonnes at a Ohio 29,097,274 value of $CA 170,776,655. Nine of these export shipments were North Dakota 24,623,127 Wisconsin 23,508,350 delivered by water (to the eastern seaboard) reflecting 131,540 tonnes Oregon 22,753,015 at a value of $CA 31,699,825. And two-hundred and sixty-four of Washington 13,549,152 these export shipments were delivered by truck reflecting 234,263 Missouri 12,384,606 Illinois 9,858,161 tonnes at a value of $CA 71,099,600. Montana 9,308,425

Puerto Rico 7,372,077 Pennsylvania 6,218,316 Sidenote: Revenues per tonne $345.5 rail; $239.90 water $303.50 Side Note: Colorado 5,956,416 truck. At first glance it may appear that rail is the most profitable form North Carolina 5,629,419 Iowa 4,635,222 of transportation. However, when one considers the number of Nebraska 4,634,835 independent truckers that are self-employed hauling Canadian grains Michigan 4,137,191 Texas 3,368,839 across the boarder; vs one train carrying 100 cars across the border; South Carolina 3,303,054 perhaps the real economic benefit should be in our communities and Utah 2,531,222 not at railway shareholder AGMs. Just a thought! Indiana 2,137,020 Virginia 2,099,244 Florida 1,997,436 The pie-char below shows the percentage of volume of Alberta wheat Tennessee 1,789,275 New Jersey 1,222,601 exported to the United States in 2017 by mode of transportation to its Kansas 833,012 delivery point. Massachusetts 761,023 Alabama 689,693 Water, 15.29% California 476,215 Vermont 191,413 Road, Idaho 65,085 57.47% South Dakota 57,770 Maryland 40,793 Arizona 17,776 Kentucky 13,807 New Hampshire 4,322 Oklahoma 3,300 Rail , 27.24% Maine 1,722 Georgia 1,115

Total Volume – 881,945 Tonnes Source: Statistics Canada – PREDA/REDI Custom Request Total Value – $ 275+ Million

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CANOLA VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Canadian-grown canola contributes $26.7 billion to the Canadian economy each year, including more than 250,000 Canadian jobs and $11.2 billion in wages. Canola generates one quarter of all farm cash receipts (43,000 farmers grow Canola in Canada). Aside from seeds, the two main processed canola products are oil for human consumption and meal for livestock. Canada has 14 Canola

processing plants; three of which are in Alberta.

Highlights: Canola was originally a trademark name of the Rapeseed Association of Canada, the name was a condensation of "Can" from Canada and "ola". It is now a generic term for edible varieties of rapeseed oil.

Alberta’s Canola is exported to 25+ countries in any given year. The tables show the value of exports for Canola seeds. By far the largest buyer of Canola seeds is China, accounting for 40% of our Canola export revenues of $CA 2Billon overall.

Canola oil is a key ingredient in many foods. Its Alberta 2017 Export Revenues Canola Seeds – Top Countries reputation as a healthy oil has created high demand in China $ 819,344,351 Japan $ 421,911,629 markets around the world, and overall it is the third- Mexico $ 291,666,908 most widely consumed vegetable oil, after soybean oil UAE $ 139,561,238 Pakistan $ 135,995,884 and palm oil. The oil has many non-food uses and, like United States $ 96,348,386 soybean oil, is often used interchangeably with non- France $ 78,451,843 Germany $ 14,551,325 renewable petroleum-based oils in products, including Belgium $ 11,949,263 industrial lubricants, biodiesel, candles, lipsticks, and Bangladesh $ 10,810,367 Portugal $ 9,631,435 newspaper inks, depending on the price on the spot Israel $ 1,667,323 Nepal $ 1,068,548 market. Total All Countries $ 2,034,505,404

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CANOLA VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Transporting Canola:

Canola produced in the Northwest is transported out of the region by rail. The table below shows 94% of the volume produced in the Northwest in the year 2017 was delivered to a grain terminal in the Northwest region. Source: Canadian Grain Commission Northwest Alberta – Deliveries to Primary Elevators 2017-18 Canola Seeds

Production 1,296,900 Metric Tons

Delivery Point NAMPA 166.8

RYCROFT 402 HIGH LEVEL 56.2 SMOKY RIVER 160.2 SEXSMITH 134.8 MCLENNAN 132 FALHER - GRIMSHAW 173.1

Total Delivered to Elevators 1,225,000 Metric Tons

% of Production Delivered to Elevators 94%

Once the Canola seeds from the Northwest reaches a juncture point where it is mixed with deliveries from other regions, the intermodal transport begins to emerge depending on the point of export from Canada. The table below shows that Alberta had four export shipments of Canola seeds to China in the year 2017. Note, by default ocean carriers are needed to get the product to the buyer.

Source: Statistics Canada – PREDA/REDI Custom Request Alberta 2017 Canola Seeds – Exports to China Quantity Export Point Mode of Transport (KMG) Value (CA$) Prince Rupert Rail / Water 190,480,694 $107,008,408 Vancouver - Waterfront and Warehouse Rail / Water 1,230,254,863 $712,119,214 Vancouver - Waterfront and Warehouse Rail / Water 26,101 $13,752 Prince Rupert Rail / Water 656,374 $202,977 Export Revenues $819,344,351

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CANOLA VERY IMPORTANT CROP IN NORTHWEST ALBERTA

There were 87 export shipments of Canola seeds from Alberta to the United States in the year 2017. The table below shows 19 of these shipments were by rail, representing 46% of the volume of canola seeds exported to the United States in 2017.

Alberta 2017 Canola Seed Exports to United States - RAIL State Delivered Export Point Volume (KGM) Value $CA Illinois Emerson (MB) 81350 43,251 North Dakota Emerson (MB) 7381083 3,626,130 Washington, State Emerson (MB) 5619577 2,613,116 Illinois Emerson (MB) 1058052 91,322 North Dakota Emerson (MB) 2612865 1,481,756 North Dakota Emerson (MB) 607191 309,880 Washington, State Fort Frances (ON) 56530 26,293 Illinois Fort Frances (ON) 1491425 143,416 Washington, State Kingsgate (BC) 2480028 1,265,097 Washington, State Kingsgate (BC) 639231 140,798 North Dakota North Portal (SK) 10283199 5,497,899 Washington, State North Portal (SK) 28265 13,147 North Dakota North Portal (SK) 9561636 4,935,723 North Dakota North Portal (SK) 3505273 1,816,067 California Northgate (SK) 28291 16,121 Minnesota Northgate (SK) 1121817 569,660 Washington, State Northgate (SK) 35560236 16,529,293 Washington, State Pacific Highway (BC) 828620 405,581 Total Exported to US by Rail 85,685,389 $40,562,450 Source: Statistics Canada – PREDA/REDI Custom Request

The remaining 68 shipments of Alberta Canola seeds to the United States were delivered by Truck; representing 54% of the volume of canola seeds exported to the United States in 2017. The following table shows deliveries by State, the volume delivered, and the value of each shipment.

Note: There were two air cargo shipments of Alberta Canola Seeds in 2017 – Chile and Indonesia for a total volume of 39,000 KGM with a value of $209,000. Depending on who is paying for the shipping this is an incredibly expensive mode of transport for raw seeds.

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CANOLA VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Source: Statistics Canada – PREDA/REDI Custom Request Alberta 2017 Canola Seed Exports to United States - ROAD State Volume State Volume Export Point Value $CA Export Point Value $CA Delivered (KGM) Delivered (KGM)

California Abbotsford (BC) 2880 8,044 New Jersey Fort Erie (ON) 37735 23,321

Oregon Abbotsford (BC) 48899 139,370 New York Fort Erie (ON) 4578 4,015

Washington Abbotsford (BC) 32675 11,691 S. Carolina Fort Erie (ON) 1418 1,200

Minnesota Boissevain (MB) 157581 80,507 Minnesota Fort Frances (ON) 350009 180,632 N. Dakota Boissevain (MB) 54085 162,469 N. Dakota Fort Frances (ON) 15525 7,605 N. Dakota North Boissevain (MB) 1.3E+07 6,897,348 Dakota Goodlands (MB) 724203 401,950 N. Dakota Carievale (SK) 4577214 2,215,095 Oregon Kingsgate (BC) 181654 96,032

N. Dakota Coulter (MB) 3369025 1,670,518 Oregon Kingsgate (BC) 12121 65,319

California Coutts (AB) 27040 16,535 Oregon Kingsgate (BC) 245077 172,763

Colorado Coutts (AB) 538 5,469 Washington Kingsgate (BC) 87891 310,233 Washington Georgia Coutts (AB) 24651 16,397 , Kingsgate (BC) 1781724 1,008,264

Idaho Coutts (AB) 5238 17,457 New York Lansdowne (ON) 2113 1,705

Montana Coutts (AB) 40478 123,567 N. Dakota Lyleton (MB) 876529 394,238

Montana Coutts (AB) 495015 449,905 Georgia North Portal (SK) 44359 36,947

N. Dakota Coutts (AB) 33209 161,790 Illinois North Portal (SK) 4545 8,854

Washington Coutts (AB) 620 6,351 Iowa North Portal (SK) 106108 98,343

California Emerson (MB) 20507 4,313 N. Carolina North Portal (SK) 8250 34,232

Iowa Emerson (MB) 5883 83,310 N. Dakota North Portal (SK) 786771 3,472,955

Iowa Emerson (MB) 166141 150,375 N. Dakota North Portal (SK) 1.4E+07 6,479,963

Iowa Emerson (MB) 245016 115,546 N. Dakota North Portal (SK) 1662176 896,493 Washington Minnesota Emerson (MB) 55124 421,596 , North Portal (SK) 2253 26,997

Minnesota Emerson (MB) 4.2E+07 21,456,295 Minnesota Northgate (SK) 71726 64,671

Missouri Emerson (MB) 41968 27,176 N. Dakota Northgate (SK) 2076375 1,157,585

Missouri Emerson (MB) 6197 3,850 Minnesota Osoyoos (BC) 9005 3,426 Pacific Highway Missouri Emerson (MB) 6197 3,850 California (BC) 3173 2,031 Pacific Highway Montana Emerson (MB) 7394 6,657 Oregon (BC) 122282 64,773 Washington Pacific Highway N. Dakota Emerson (MB) 204138 994,833 , (BC) 6479 2,203 N. Dakota Emerson (MB) 6747585 3,501,019 Montana Regway (SK) 3462458 1,639,187 N. Dakota Emerson (MB) 589100 321,318 Oregon Regway (SK) 5638 5,378

Wisconsin Emerson (MB) 3346 2,578 Idaho Rykerts (BC) 7300 3,596

Wisconsin Emerson (MB) 124 1,678 Colorado Sarnia (ON) 2331 7,122

Wisconsin Emerson (MB) 62839 13,713 Illinois Sarnia (ON) 2464 2,776

Florida Fort Erie (ON) 4929 5,821 Minnesota Sprague (MB) 49384 25,075

New Jersey Fort Erie (ON) 1127 978 Wisconsin Sprague (MB) 2484 1,457

Total Volume Canola Exported to US - By Road 98,626,726 (KMG) $55,798,760

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DRY FIELD PEAS VERY IMPORTANT CROP IN NORTHWEST ALBERTA Dry Field Peas are a wonder food! High in protein and very friendly with agricultural sciences. The demand for pulses (field peas are a type) has skyrocketed in recent years as the population in India is exponentially growing and peas are a cheap source of protein (in comparison to meats). India is the major importer of Alberta’s field peas.

Alberta 2017 Export Revenues HS 071310 - Peas - Dried and Shelled India $ 118,436,800 Farmers in the Northwest have China $ 33,517,404 increasingly added hectares upon Bangladesh $ 11,619,801 United States $ 9,895,236 hectares dedicated to dry field peas in Myanmar (Burma) $ 1,651,240 the last decade. This is largely due to Japan $ 1,212,446 Thailand $ 831,795 the high price that can be garnered on Taiwan $ 600,591 the global markets, and the ease of Philippines $ 478,934 Fiji $ 355,557 growing them in comparison to other Colombia $ 353,116 Indonesia $ 335,158 crops. Korea, South $ 232,480 United Arab Emirates $ 224,444 Peru $ 181,734 Current Issues: Global demand for Trinidad and Tobago $ 164,185 pulse crops (such a dry field peas) is Morocco $ 158,018 Ecuador $ 135,336 increasing; especially in India. Guyana $ 133,980 However, demand is also creating Qatar $ 124,250 Italy $ 120,729 trade instability with our top importer Nepal $ 107,305 of peas. The Canadian pulse sector Dominican Republic $ 53,587 Suriname $ 40,142 felt the impact of three distinct trade Israel $ 37,050 Mauritius $ 35,317 actions taken by the Indian Panama $ 34,554 government during the 2017-18 crop Vietnam $ 30,843 Sweden $ 18,653 year. Spain $ 17,698 Malaysia $ 13,879 Malta $ 10,250 Singapore $ 9,973

Sub-Total $ 181,172,485 Total All Countries $ 181,172,485 Source: Industry Canada – Trade Data

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DRY FIELD PEAS VERY IMPORTANT CROP IN NORTHWEST ALBERTA

The first of these was the removal of a country-specific exemption on 1 October 2017 that had allowed the importation of pulses to be fumigated with methyl-bromide upon arrival in India without penalty. This meant that Canadian shipments could still be exported to India under the general exemption, which is set to expire on 30 June 2019. However, Canadian shipments were now subject to a five-fold increase in the regular inspection fees payable upon arrival in India, which equated to about $15 per tonne. The loss of these exemptions was compounded by an ever-expanding series of restrictive trade measures. Beyond the Indian government’s requirement for the fumigation of all imported grain, it moved to increase tariffs on several key crops, including the raising of tariffs on: peas to 50% from 0%; lentils and chickpeas to 30% from 10%; and on chickpeas to 60%.

Further to this, in April 2018 India introduced limits on the volume of imported peas, which was initially restricted to 100,000 tonnes for three months, but frequently extended and ultimately taking the form of an import prohibition currently set to expire on 31 March 2019. These measures have had a significant impact on pulse deliveries, which were virtually halved as the Canadian industry started to deal with the realities of being effectively shutout of a market that absorbed about 40% of Canada’s pulse production, as well as the financial fallout from declining prices and margins.

Moreover, in the face of what was expected to be a continuing global oversupply, few believed that the situation would reverse itself in the near term. Fortunately, China moved to take advantage of the situation, virtually doubling its Canadian pea imports for the year. Still, the market damage had been done, and many industry observers predicted that a sharp pullback in Canadian pulse production would ensue in 2018. With year-end statistics showing a 13% decline in seeded acres, these predictions appeared to have been correct.

Source: Annual Report of the Monitor – Canadian Grain Handling and Transportation System

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DRY FIELD PEAS VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Transporting Field Peas: Field Peas produced in the Northwest are transported out of the region by rail. The table below shows 98% of the volume produced in the Northwest in the year 2017 was delivered to a grain terminal in the Northwest region.

Source: Canadian Grain Commission

Northwest Alberta – Deliveries to Primary Elevators 2017-18 Field Peas Production 399,400 Metric Tonnes

Delivery Point NAMPA 14.8 RYCROFT 133.9 HIGH LEVEL 21.5 SMOKY RIVER 40.3 SEXSMITH 63.3

MCLENNAN 20.0 FALHER 23.7

GRIMSHAW 73.5

391,100 Metric Tonnes Total Delivered to Elevators

% of Production Delivered to Elevators 98%

Once the field peas from the Northwest reaches a juncture point and mixed with deliveries from other regions the intermodal transport begins to emerge depending on the point of export from Canada. In total, in 2017 there were 141 export shipments of field peas from Alberta to 33 countries. The largest bulk of volume shipped has been exported to India; which accounted for 65% of all export revenues generated from the sale of field peas. China, Bangladesh and the United States are the next top three buyers of Alberta field peas. The next tables show each shipment for each of these countries along with the point of export, the mode of transport, the volume exported and the value of each export.

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DRY FIELD PEAS VERY IMPORTANT CROP IN NORTHWEST ALBERTA Source: Statistics Canada – PREDA/REDI Custom Request

Alberta 2017 Export of Field Peas to India India is the largest buyer of Alberta Field Mode of Volume Exit Point Transport (KGM) Value $CA Peas, representing 65% of the total export Vancouver Rail / Water 262950 103,434 revenues generated in the year 2017. Vancouver Rail / Water 2316820 992,751

Vancouver Rail / Water 4995400 1,743,750 Vancouver Rail / Water 295,669,002 115,596,865 Total 303,244,172 $118,436,800

Source: Statistics Canada – PREDA/REDI Custom Request

Field pea (Pisum sativum L.), a native of Alberta 2017 Export of Field Peas to China Southwest Asia, was among the first crops Mode of Volume cultivated by man. Wild field pea can still be Exit Point Transport (KGM) Value $CA found in Afghanistan, Iran and Ethiopia. Prince Rupert Rail / Water 3412272 2,452,651 Today, the countries leading in field pea Vancouver Rail / Water 1471992 1,218,839 production include the Soviet Union, China, Vancouver Rail / Water 241000 254,856 India, Canada, and the United States. In Vancouver Rail / Water 355820 182,707 Canada over 450,000 acres are dedicated to the growing of the field pea. Cultivation has Prince Rupert Rail / Water 620040 219,755 led to a gradual separation of types: those Vancouver Rail / Water 4601135 1,784,461 grown for vegetable use, those grown for seed Montréal Rail / Water 272170 109,039 and fodder, and the edible podded types Prince Rupert Rail / Water 1247655 633,753 which have evolved most recently. Vancouver Rail / Water 67166804 26,361,747

Total 79,388,888 $33,217,808

Alberta 2017 Export of Field Peas to Bangladesh Mode of Volume Exit Point Transport (KGM) Value $CA Vancouver Rail / Water 3,100,000 $11,619,801

Source: Statistics Canada – PREDA/REDI Custom Request

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DRY FIELD PEAS VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Source: Industry Canada – Trade Data Alberta 2017 Export Revenues There were 69 export shipments of Alberta field peas to the Field Peas – United States United States in the year 2017; representing a volume of Iowa 2,207,391 North Dakota 1,698,821 15,725,009 KGM at a value of $9.9 Million. Of these shipments California 1,547,342 16 were delivered by rail while the remaining 53 shipments were Washington 1,285,870 Montana 779,596 delivered by truck. Nebraska 771,734 Alberta 2017 Pennsylvania 432,713 Field Pea Exports to United States – Transport Mode Utah 303,207 Kansas 300,720 Transport Volume (KGM) Value $CA Idaho 132,764 Rail Minnesota 113,120 5,280,602 3,319,451 Mississippi 82,771 Road 10,444,407 6,573,037 South Carolina 55,516 Total 15,725,009 KGM $9.9 Million Wisconsin 53,537 Source: Statistics Canada – PREDA/REDI Custom Request Ohio 39,228 Texas 39,122 Current Issue: California paid a total of $US 20,293,128 South Dakota 20,193 to import field peas in the year 2017 - $US16,387,034 of New York 14,059 New Jersey 13,509 those imports came from Canada. The current craze over Oregon 4,023 $9,895,236 meat-alternatives plant-based proteins has skyrocketed the Total CA$ demand for peas in California. Why?

“Beyond Meat” is headquartered in California!

Currently ‘Beyond Meat ‘ is the best-performing U.S. IPO of the year. A&W debuted the “Beyond Meat” burger at its 925 stores across Canada in July 2018. The fast food chain itself doesn’t make the burgers, but buys them from the high-tech food company “Beyond Meat”. Right now, A&W Canada is the California-based food company’s biggest restaurant partner. The market for meat alternatives has been getting a lot of attention recently, as major players such as Nestlé and Tyson Foods have entered the space and Barclays has valued its potential at $140 billion a year.

Beyond Meat is a Los Angeles-based producer of plant-based meat substitutes founded in 2009 by Ethan Brown. The company's products became available across the United States in 2013. In May 2016, it released the first plant-based burger to be sold in the meat section of grocery stores, on an international basis.

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OATS VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Transport to US: Rail 22% Road 76% Water <1% Statistics Canada – PREDA/REDI Custom Request HS 110319 - Cereal Groats and Meal Alberta 2017 Export Revenues ($CA) HS 1004 - Oats California $ 2,240,688 Alberta 2017 Export Revenues ($CA) Nebraska $ 1,895,775 Iowa $ 7,835,145 Utah $ 1,013,296 Minnesota $ 5,939,935 Wisconsin $ 925,841 Wisconsin $ 4,708,937 Minnesota $ 847,508 Nebraska $ 2,532,010 Illinois $ 817,060 Ohio $ 1,897,774 Iowa $ 660,234 Oregon $ 1,038,312 Pennsylvania $ 244,875 Pennsylvania $ 428,185 Texas $ 223,299 California $ 401,276 Missouri $ 185,742 North Dakota $ 351,652 Connecticut $ 114,724 South Dakota $ 249,832 Michigan $ 110,253 Kentucky $ 220,387 Oregon $ 91,822 New York $ 174,850 Colorado $ 45,470 Texas $ 161,039 Indiana $ 38,565 Idaho $ 103,694 Washington $ 38,346 All Other Us States $836,288 Montana $ 31,683 Sub-total US $ 26,879,316 93% Oklahoma $ 28,763 Other Countries $ 1,907,566 New York $ 26,114 Total All Countries $ 28,786,882 Massachusetts $ 24,497 Source – Industry Canada Trade Data South Carolina $ 14,736 North Dakota $ 4,809 Oats are a wonder crop. Easy to store, highly Ohio $ 4,400 Sub-total US $ 9,628,500 69% nutritious for both humans and livestock, Others $ 4,674,806 relatively cheap to transport by volume, and is Total All Countries $ 14,303,306 widely used in the cosmetic industry. There are several grades of oats available to end-users. Feed Oats (no processing) to various levels of drying and screening (Nil-Dockage, Double Cleaned, and Triple Cleaned). Grout is the inside kernel of a cereal grain mostly used for higher end human consumption products while the hulls are primarily used for fibre, feed, and biomass. Alberta’s northwest is renowned for its “Pony Oats” a superior quality processed oat primarily used to feed high end race or competition horses with very selective customers. Oat farmers in Alberta target this niche market, recognizing they get more money than selling food-grade bulk oats on the global markets. Very Smart!

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OATS VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Transporting Oats: As noted in the previous table, in 2017 Customs Canada cleared Alberta oats exports at a value of $CA 28.7 Million These export revenues represented 301 export shipments of Oats for an overall volume of 103,494,592KGM with most of these export shipments going to the United States. There are three sub-categories listed under the Harmonized Coding System (HS) for Oats. The chart shows the number of shipments for each of these HS product

Alberta 2017 Oat Exports - 301 Shipments- categories: 1) HS1004.10.00 Oats, seed for sowing; 2) By HS Code HS1004.90.10 Oat, certified organic, o/t seed for sowing; and

Seeds , 49 3) HS 1004.90.90 Oat, o/t certified organic, o/t seed for sowing (o/t means other than). From an export perspective it is interesting to identify if these categories have preferred Oats, 205 international customers. Organic, 47

Source: Statistics Canada – PREDA/REDI Custom Request 2017 Alberta Oat Exports Oats 205 Shipments Seeds 49 Shipments Organic 47 Shipments Total Volume KGM Australia 164 164 Chile 2,798 2,798 China 37,400 548,864 41,714 627,978 Cuba 41,250 41,250 Ecuador 1,059,681 1,059,681 France 3 3 Japan 1,444,754 22,691 313,075 1,780,520 Mexico 6,053 148,536 154,589 Mongolia 7,798 7,798 Morocco 1,340 1,340 New Zealand 3,787 3,787 Peru 515,900 515,900 Philippines 8,022 8,022 Saint Pierre and MIC 20 20 Saudi Arabia 20,905 20,905 Singapore 150 150 South Korea 282,122 603,029 885,151 South Sudan 3,021 3,021 Taiwan 365 365 Thailand 3,428 3,428 Trinidad and Tobago 10,050 10,050 United Arab Emirates 12,246 12,246 United Kingdom 5,288 5,288 United States 97,245,665 433,514 670,959 98,350,138 Total Volume (KGM) 100,659,685 KGM 1,164,365 KGM 1,670,542 KGM 103,494,592 KGM

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OATS VERY IMPORTANT CROP IN NORTHWEST ALBERTA When Alberta’s 301 Oat export shipments for the year 2017 are cross-referenced with country and oat HS category preferential international customers emerge. Organic Oats (by volume) are largely purchased by Japan and South Korea. China, United States and Mexico account for most Oat seeds for sowing sold in the year 2017.

The United Sates accounts for 97% of all generic oats (not organic, not sold for sowing). Generic oats are also the most significant volume sold for Oats products in the Harmonized Coding System (HS). The table below shows the value and the top six states (>1M) Alberta generic oats are sold.

Alberta Oat Exports to USA – Top Six States ($CA) 2014 2015 2016 2017 Iowa 13,800,518 14,609,636 11,662,140 7,824,638 Minnesota 7,574,756 7,817,744 4,913,544 5,936,446 Wisconsin 3,651,115 6,068,120 5,378,003 4,697,972 Nebraska 5,294,113 4,310,259 2,494,816 2,531,107 Ohio 3,854,638 1,499,640 2,027,774 1,893,864 Oregon 1,468,874 1,630,224 1,600,708 1,035,972 Source: Industry Canada – Trade Data The transportation of Alberta oats is largely by truck; especially into the United States.

Alberta Oat Exports – Shipments - By Mode of Transport

HS Code Air Rail Road Water Total # Oats (Generic) 1 57 126 21 205

Oat - Seeds 1 1 42 5 49

Oat - Organic 1 4 36 6 47 Total 2017 Export Shipments 3 62 204 32 301

Alberta 2017 Oat Export - # of Shipments By Mode of Transport

Water, 32 Air, 3

Rail, 62

Road , 204

Source: Statistics Canada – PREDA/REDI Custom Request

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OATS VERY IMPORTANT CROP IN NORTHWEST ALBERTA Rail shipment is generally not captured in the grain elevator system for Oat exports in the Northwest. . The previous table showed there were 62 export shipments of oats by rail. The table below shows the volume of Oats exported from Alberta, by rail to the United States (State drop-off point identified).

Source: Statistics Canada – PREDA/REDI Custom Request Alberta 2017 Oat Export – By Rail Volume Oats - HS Code Country US State Export Point (KGM) Value ($CA)

Oats, seed for sowing MX Emerson, MB 148,536 $54,462 Oat, o/t certified organic, o/t seed for sowing MX Vancouver, BC 6,053 $1,620 Oat, o/t certified organic, o/t seed for sowing US Oregon Coutts 5,025 $1,122 Oat, certified organic, o/t seed for sowing US Wisconsin Emerson, MB 31,690 $17,249 Oat, o/t certified organic, o/t seed for sowing US Colorado Emerson, MB 30,850 $6,908 Oat, o/t certified organic, o/t seed for sowing US Iowa Emerson, MB 5,267,038 $1,650,234 Oat, o/t certified organic, o/t seed for sowing US Kentucky Emerson, MB 297,830 $99,422 Oat, o/t certified organic, o/t seed for sowing US Minnesota Emerson, MB 11,705,800 $3,104,806 Oat, o/t certified organic, o/t seed for sowing US Missouri Emerson, MB 146,846 $23,495 Oat, o/t certified organic, o/t seed for sowing US Nebraska Emerson, MB 2,556,113 $683,542 Oat, o/t certified organic, o/t seed for sowing US Ohio Emerson, MB 186,144 $61,847 Oat, o/t certified organic, o/t seed for sowing US Wisconsin Emerson, MB 2,256,933 $616,180 Oat, certified organic, o/t seed for sowing US Minnesota Fort Frances, ON 16,304 $5,185 Oat, o/t certified organic, o/t seed for sowing US Illinois Fort Frances, ON 21,043 $5,843 Oat, o/t certified organic, o/t seed for sowing US Indiana Fort Frances, ON 20,365 $5,957 Oat, o/t certified organic, o/t seed for sowing US Iowa Fort Frances, ON 18,629,706 $5,697,042 Oat, o/t certified organic, o/t seed for sowing US Kentucky Fort Frances, ON 392,675 $108,421 Oat, o/t certified organic, o/t seed for sowing US Louisiana Fort Frances, ON 39,201 $11,567 Oat, o/t certified organic, o/t seed for sowing US Minnesota Fort Frances, ON 5,905,276 $1,422,729 Oat, o/t certified organic, o/t seed for sowing US Nebraska Fort Frances, ON 1,566,426 $455,348 Oat, o/t certified organic, o/t seed for sowing US New Mexico Fort Frances, ON 5,318 $1,226 Oat, o/t certified organic, o/t seed for sowing US Ohio Fort Frances, ON 435,401 $141,239 Oat, o/t certified organic, o/t seed for sowing US Oregon Fort Frances, ON 10,720 $4,488 Oat, o/t certified organic, o/t seed for sowing US Texas Fort Frances, ON 239,110 $76,107 Oat, o/t certified organic, o/t seed for sowing US Wisconsin Fort Frances, ON 15,378,932 $3,707,587 Oat, o/t certified organic, o/t seed for sowing US Oregon Kingsgate, BC 11,724 $5,843 Oat, o/t certified organic, o/t seed for sowing US Florida North Portal, SK 13,698 $5,268 Oat, o/t certified organic, o/t seed for sowing US Iowa North Portal, SK 288,229 $54,495 Oat, o/t certified organic, o/t seed for sowing US Minnesota North Portal, SK 468,980 $139,206 Oat, o/t certified organic, o/t seed for sowing US Missouri North Portal, SK 6,565 $1,181

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Alberta 2017 Oat Export – By Rail (cont’d) Volume Oats - HS Code Country US State Export Point (KGM) Value ($CA) Oat, o/t certified organic, o/t seed for sowing US Virginia North Portal, SK 18,639 $11,191 Oat, o/t certified organic, o/t seed for sowing US Colorado Northgate, SK 80,982 $14,194 Oat, o/t certified organic, o/t seed for sowing US Iowa Northgate, SK 402,352 $72,286 Oat, o/t certified organic, o/t seed for sowing US Louisiana Northgate, SK 248,727 $43,613 Oat, o/t certified organic, o/t seed for sowing US Minnesota Northgate, SK 514,073 $97,498 Oat, o/t certified organic, o/t seed for sowing US Missouri Northgate, SK 63,592 $10,779 Oat, o/t certified organic, o/t seed for sowing US Oklahoma Northgate, SK 35,564 $5,601 Oat, o/t certified organic, o/t seed for sowing US Texas Northgate, SK 284,494 $52,029 Oat, o/t certified organic, o/t seed for sowing US Wisconsin Northgate, SK 1,163,883 $207,009 Oat, o/t certified organic, o/t seed for sowing US Arizona Pacific Highway, BC 5,905 $1,112 Oat, o/t certified organic, o/t seed for sowing US California Pacific Highway, BC 1,215,908 $256,722 Oat, o/t certified organic, o/t seed for sowing US Colorado Pacific Highway, BC 70,790 $24,873 Oat, o/t certified organic, o/t seed for sowing US Iowa Pacific Highway, BC 10,934 $4,599 Oat, o/t certified organic, o/t seed for sowing US Minnesota Pacific Highway, BC 14,991 $4,993 Oat, o/t certified organic, o/t seed for sowing US New Mexico Pacific Highway, BC 105,812 $41,201 Oat, o/t certified organic, o/t seed for sowing US Oregon Pacific Highway, BC 3,309,354 $1,004,041 Oat, o/t certified organic, o/t seed for sowing US Texas Pacific Highway, BC 11,659 $3,404 Oat, o/t certified organic, o/t seed for sowing US Washington, Pacific Highway, BC 80,068 $18,944 Oat, o/t certified organic, o/t seed for sowing US Wisconsin Pacific Highway, BC 30,976 $17,263 Oat, o/t certified organic, o/t seed for sowing US Iowa Sarnia, ON 390,061 $109,606 Oat, o/t certified organic, o/t seed for sowing US Ohio Sarnia, ON 74,726 $17,204 Oat, certified organic, o/t seed for sowing US Pennsylvania St-Bernard, QU 28,430 $6,850 Oat, o/t certified organic, o/t seed for sowing US New York St-Bernard, QU 33,208 $8,073 Oat, o/t certified organic, o/t seed for sowing US North Carolina St-Bernard, QU 27,051 $5,811 Oat, o/t certified organic, o/t seed for sowing US Pennsylvania St-Bernard, QU 461,580 $100,144 Oat, certified organic, o/t seed for sowing US Maryland Trout River, QU 5,670 $1,274 Oat, o/t certified organic, o/t seed for sowing US Florida Trout River, QU 85,127 $14,738 Oat, o/t certified organic, o/t seed for sowing US Georgia Trout River, QU 50,057 $11,026 Oat, o/t certified organic, o/t seed for sowing US Maryland Trout River, QU 65,882 $15,670 Oat, o/t certified organic, o/t seed for sowing US New York Trout River, QU 5,584 $1,358 Oat, o/t certified organic, o/t seed for sowing US South Carolina Trout River, QU 27,728 $6,055 Oat, o/t certified organic, o/t seed for sowing US Kentucky Windsor, ON 35,481 $5,164

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BARLEY VERY IMPORTANT CROP IN NORTHWEST ALBERTA Barley is ranked fourth internationally among grains in quantity produced (141 million tonnes globally) behind corn, rice and wheat.

HS 100310 - Barley: Seed Barley, a member of the grass family, Idaho $ 258,122 is a major cereal grain. It was one of Montana $ 205,369 Maine $ 80,843 the first cultivated grains, particularly New York $ 64,735 in Eurasia as early as 10,000 years ago. Oregon $ 55,779 Missouri $ 52,104 Barley has been used as animal fodder, Pennsylvania $ 37,397 Wyoming $ 34,878 as a source of fermentable material for Wisconsin $ 27,902 beer and certain distilled beverages, Vermont $ 24,252 Ohio $ 11,450 and as a component of various health Illinois $ 7,095 foods. North Dakota $ 5,305 Minnesota $ 4,916 Alaska $ 2,429 HS 110710 – Barley Malt - Not Roasted

Washington $ 2,043 California $ 40,787,378 Sub-Total US $ 874,619 97% North Carolina $ 15,201,710 Other Countries $ 23,941 Colorado $ 12,812,299 Illinois $ 11,692,340 All Countries $ 898,560 Vermont $ 10,027,977

Barley is used in soups and stews, and in Washington $ 7,555,610 barley bread of various cultures. There are New York $ 4,953,242 Tennessee $ 1,342,563 no processing plants for barley in the Texas $ 960,275

Northwest; all barley that leaves the region is Hawaii $ 944,474 Georgia $ 794,866 sent to processors elsewhere in Alberta or Minnesota $ 591,955 Canada. There are currently 25 barley Kansas $ 522,992 Arizona $ 405,253 merchants (direct buyers from the farm) in Delaware $ 219,071 Wisconsin $ 140,247 Alberta. Massachusetts $ 120,106 New Hampshire $ 68,589 Virginia $ 47,154 Pennsylvania $ 22,137 Maryland $ 20,775 Missouri $ 17,632 Sub-Total - US 109,248,645 Barley Transport to US:

76% Road 24% Rail 1% Water Other Countries $ 131,031,757

All Countries $ 241,155,021

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ALFALFA VERY IMPORTANT CROP IN NORTHWEST ALBERTA HS 120921 - Lucerne (Alfalfa) Seeds Alberta 2017 Export Revenues to US($CA) Distribution by State Ninety-four percent (94%) of all of Alberta’s fescue seed Idaho $ 27,650,651 export revenues comes from sales to the USA. Note that of Montana $ 417,365 Washington $ 377,927 $29.1M imported by the US - $27.6M went to Idaho. Idaho is California $ 229,516 Cowboy country with numerous cattle ranches. Alfalfa seed Iowa $ 192,553 Minnesota $ 120,175 grows superior feed. The table below shows in greater detail Indiana $ 105,993 Alberta’s export of Alfalfa seeds; approximately a 60/40 split New York $ 14,852 Vermont $ 12,301 between certified and non-certified. Certified indicates Sub-total USA $ 29,121,333 Other Countries $ 1,774,003 confirmation of seed type. It does not relate to organic. There Total Export Revenues $ 30,895,336 is a small differential in favor of the certified paperwork when exporting, however, because the majority of seeds are being used to grow feed for livestock the premium is minimal (<2% per KGM more than non-certified).

Alfalfa Seeds – By Type Exports to USA – Certified vs Non-Certified HS Code Volume Value $CA 8th Level Alfalfa Seeds – By Type (KGM) 1209.21.10 Lucerne (alfalfa) seeds, for sowing, certified 3,591,021 $ 17,997,358.00 1209.21.90 Lucerne (alfalfa) seeds, for sowing, o/t certified 2,260,535 $ 12,897,978.00 Total 5,851,556 $ 30,895,336.00 Source: Statistics Canada – PREDA/REDI Custom Request

Transporting Alfalfa Seeds: There were 24 export shipments of Alfalfa seeds from Alberta in the year 2017. Alfalfa seeds are transported from the farm by truck to a local seed cleaning plant. The seeds are bagged by pre-weights and then loaded to a container and transported by Truck to the exit point (water if overseas) or by truck if the destination is within the USA. Source: Canada Customs – PREDA/REDI Custom Request Alberta 2017 Export Revenues – Alfalfa Seeds – By Country – Export Point, Mode of Transport, Volume Volume Alafala Seed - Type Country Export Point Mode (KGM) Value $CA Lucerne (alfalfa) seeds, for sowing, certified Argentina Montréal, QU Water 24,000 $ 112,123 Lucerne (alfalfa) seeds, for sowing, certified Argentina Vancouver, BC Water 173,669 $ 659,698 Lucerne (alfalfa) seeds, for sowing, certified Chile Niagara Falls, ON Water 1125 $ 4,112 Lucerne (alfalfa) seeds, for sowing, o/t certified Chile Vancouver, BC Water 895,02 $ 317,891 Lucerne (alfalfa) seeds, for sowing, o/t certified China Prince Rupert, BC Water 40,000 $ 198,118 Lucerne (alfalfa) seeds, for sowing, certified Netherlands Montréal, QU Water 42,686 $ 218,969 Lucerne (alfalfa) seeds, for sowing, certified Turkey Montréal, QU Water 51,050 $ 263,092 Lucerne (alfalfa) seeds, for sowing, certified USA Various Road 3,298,491 $ 16,739,364 Lucerne (alfalfa) seeds, for sowing, o/t certified USA Various Road 2,131,033 $ 12,381,969 Total 5,851,556 $ 30,895,336.00

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ALFALFA VERY IMPORTANT CROP IN NORTHWEST ALBERTA

In 2017 the US spent $US 48.7 Million importing Alfalfa seeds, with 83% coming from Canada; and most of Canada’s sales coming from Alberta. Notice the table below showing other global markets that sell alfalfa seeds to the US. California imports $5.8 Million worth from the Australian region. There may be potential expansion opportunities for Northwest farmers.

Source: PREDA / REDI Special Access Request – US Trade portal

All US 2017 Imports $US - HS 120921 - Lucerne (Alfalfa) Seeds ($US) Asia Australia and Oceania Europe Canada Total $US All States $ 6,750 $ 6,391,516 $ 1,739,656 $ 40,610,145 $ 48,748,067 Arizona $ 138,250 $ 7,945 $ 146,195 California $ 5,862,558 $ 229,151 $ 1,555,848 $ 7,647,557 Florida $ 181,763 $ 181,763 Idaho $ 30,605,157 $ 30,605,157 Illinois $ 10,184 $ 10,184 Indiana $ 609,557 $ 609,557 Iowa $ 749,490 $ 589,876 $ 1,339,366 Kentucky $ 387,200 $ 312,000 $ 136,248 $ 835,448 Maine $ 12,984 $ 12,984 Michigan $ 153,257 $ 153,257 Minnesota $ 767,519 $ 767,519 Missouri $ 112,906 $ 112,906 Montana $ 632,129 $ 632,129 Nebraska $ 3,508 $ 12,250 $ 15,758 New York $ 6,750 $ 453,904 $ 460,654 North Dakota $ 611,996 $ 611,996 Ohio $ 191,087 $ 191,087 Oklahoma $ 173,926 $ 173,926 Oregon $ 22,800 $ 400,117 $ 422,917 Pennsylvania $ 383,350 $ 383,350 South Dakota $ 15,730 $ 15,730 Tennessee $ 418,270 $ 256,233 $ 674,503

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ALFALFA VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Alberta exported 100% of its Alfalfa meal / pellets to the United Sates in the year 2017.

HS 121410 - Lucerne (Alfalfa) Meal and Pellets HS 121410 - Lucerne (Alfalfa) Meal and Pellets

Alberta 2017 Export Revenues ($CA) Canada 2017 Export Revenues ($CA)

Florida $ 3,532,579 Alberta $ 6,431,640 Ohio $ 546,938 Ontario $ 5,234,544 50% NY and VT Pennsylvania $ 438,708 Saskatchewan $ 3,576,652 30% WI Vermont $ 330,914 Quebec $ 222,278 70% VT Kentucky $ 301,734 Sub-total - USA $ 15,465,114 New York $ 255,098 HS 121410 - Lucerne (Alfalfa) Meal and Pellets USA Texas $ 235,064 2017 Imports Indiana $ 181,551 Africa $ 6,579 Tennessee $ 94,846 Asia $ 363,770 North Carolina $ 85,611 Europe $ 486,726 Delaware $ 80,684 Mexico $ 3,610,192 60% California Oklahoma $ 73,676 S/Cl America $ 7,450 Michigan $ 52,789 New Jersey $ 44,702 Yet, Alberta’s sale of Alfalfa meal and Maine $ 43,457 pellets to the US accounts for less than Virginia $ 30,935 Connecticut $ 30,479 40% of the total Alfalfa imported by Maryland $ 29,429 the US. - $3.6M of alfalfa meal is Massachusetts $ 22,583 New Hampshire $ 11,474 imported by the US from Mexico. Montana $ 8,389 Again, identifying another potential Sub-total USA $ 6,431,640 Total AB Export Revenues $ 6,431,640 market expansion for Northwest

farmers. The table below shows the vast majority of the alfalfa meal exported is non-dehydrated.

Source: PREDA/ REDI Custom Request – Canada Customs – HS Level 8 HS Code Alfalfa Meal & Pellets Volume th 8 Level Exports to USA – Dehydrated vs Non-Dehydrated (Tonnes) Value $CA 1214.10.10 Lucerne (alfalfa) meal and pellets, dehydrated 768 $ 450,072.00 1214.10.90 Lucerne (alfalfa) meal and pellets, o/t dehydrated 13,181 $ 5,981,568.00

Total 13,949 $ 6,431,640

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ALFALFA VERY IMPORTANT CROP IN NORTHWEST ALBERTA

The table below shows a summary of export revenues for Alfalfa - $CA 30,895,336 for seeds (94% sold to the US) ; $CA6,431,640 for meal & pellets (100% sold to the US); and $CA 20,598,217.00 (<1% sold to the US).

Alberta Export Revenues – Alfalfa by Type and Volume Volume Value 1209.21.10 Lucerne (alfalfa) seeds, for sowing, certified 3,591,021 (KGM) $17,997,358 1209.21.90 Lucerne (alfalfa) seeds, for sowing, o/t certified 2,260,535 (KGM) $12,897,978 1214.10.10 Lucerne (alfalfa) meal and pellets, dehydrated 768 Tonne $450,072 1214.10.90 Lucerne (alfalfa) meal and pellets, o/t dehydrated 13,181 Tonne $5,981,568 1214.90.11 Alfalfa in cubes, dehydrated 3,241 Tonne $1,175,109 1214.90.19 Alfalfa, nes, in bales or loose 59,287 Tonne $19,423,108

Alberta 2017 Export Revenues – Alfalfa Bales / Loose 72% of Alberta’s export revenues for Alfalfa (Non-US) Volume Bales / Loose came from sales to China in Country Export Point Mode $CA Tonnes the year 2017. China Calgary, AB Air 4745 1,574,752 China P Rupert, BC Water 7784 2,328,866 China Vancouver, BC Water 29984 10,147,609 China Vancouver, BC Air 282 78,659 Dom Rep Vancouver, BC Water 25 12,249 India Vancouver, BC Water 11 3,849 Japan Calgary, AB Air 1491 412,129 Japan P Rupert, BC Water 428 136,433 Japan Vancouver, BC Water 4615 1,684,623 S. Korea Calgary, AB Air 114 30,277 S. Korea Vancouver, BC Water 6652 2,103,878 UAE Calgary, AB Air 75 16,872 UAE Vancouver, BC Water 2116 655,421 UK Vancouver, BC Water 50 21,145 Vietnam Vancouver, BC Water 25 9,109 Total – Non-US Sales 58,397 19,215,871

FYI: Wikipedia - Alfalfa (/ælˈfælfə/), also called lucerne, is a perennial flowering plant in the legume family. It is cultivated as an important forage crop in many countries around the world. It is used for grazing, hay, and silage, as well as a green manure and cover crop. The name alfalfa is used in North America. The name lucerne is the more commonly used name in the United Kingdom, South Africa, Australia, and New Zealand. It has been cultivated as livestock fodder since at least the era of the ancient Greeks and Romans. Alfalfa sprouts are a common ingredient in dishes made in South Indian cuisine.

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FESCUE VERY IMPORTANT CROP IN NORTHWEST ALBERTA

HS 120923 – All Fescue Seeds Alberta 2017 Export Revenues ($CA) Almost all of Alberta’s fescue (grass) seeds Oregon $ 12,707,990 are sold to the US (90%) with the vast majority Minnesota $ 1,931,236 Wisconsin $ 1,604,971 being bought by Oregon. Pennsylvania $ 1,310,085 Oregon has a grasslands coalition made up of Massachusetts $ 1,151,989 Illinois $ 898,934 numerous brokers that either sell Alberta’s Montana $ 812,902 Missouri $ 751,497 fescue seeds directly or mix it with other grass Michigan $ 743,849 seeds (e.g. Kentucky blue grass) for turf and Indiana $ 651,324 Ohio $ 601,091 sod. Fescue is also a forage seed crop with New Jersey $ 543,393 high rates of protein for livestock. North Dakota $ 532,317 New York $ 481,768 Promotional videos of the Oregon region Vermont $ 260,811 brand it as the “turf capital of the world. Maryland $ 253,420 Tennessee $ 220,573 Nowhere within these promotional videos that North Carolina $ 210,495 Washington $ 190,962 showcase the turf grass seeds of Oregon Idaho $ 150,352 landscaping Wimbledon, the US Golf Opens Colorado $ 107,817 Virginia $ 86,369 and luxurious residential homes is “Peace Kentucky $ 67,491 Country” fescue mentioned. Nebraska $ 54,718 New Hampshire $ 51,818 Maine $ 24,096 California $ 23,856 Sub-total USA $ 26,426,124 90% Other Countries $ 2,977,860 Total All Countries $ 29,403,984

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FESCUE VERY IMPORTANT CROP IN NORTHWEST ALBERTA

“In Canada, virtually all creeping red fescue production is grown in the Peace Region; and it is renowned for its superior

qualities of hardiness and germination ratios.”

Alberta 2017 Export Revenues – Creeping Red Fescue Amount $CA Volume (KGM) Creeping Red $ 28,295,938.00 11,582,690

All Fescue - Total $ 29,403,984.00 11,841,131

Source: PREDA/ REDI Custom Request – Canada Customs – HS Level 8

Of all the Fescue exported from Alberta 98% is Creeping Red. Photo: Creeping Red Fescue There were 83 export shipments of Fescue from Alberta in the year 2017. The table below shows the exports by type, country, export point, mode of transport volume and value for 5 of these shipments (non-USA). Note all Non-USA exports were Creeping Red Fescue. These 5 shipments generated $CA2.9 Million in export revenues for Alberta.

100% of Fescue is trucked to local seed cleaning co-ops where is bagged, loaded into a container and then transported by Truck to the export point.

Alberta 2017 Export Revenues – Creeping Red Fescue – By Country (Non- US), Mode of Transport, Volume Exported Export Volume Fescue Type Transport Value $CA To Point KGM Prince Creeping red fescue seeds, for sowing, o/t certified China Water 287,958 $ 514,419.00 Rupert, BC Vancouver, Creeping red fescue seeds, for sowing, o/t certified China Water 326,383 $ 481,530.00 BC Montréal, Creeping red fescue seeds, for sowing, certified Germany Water 407,000 $ 758,581.00 QU Vancouver, Creeping red fescue seeds, for sowing, o/t certified Japan Water 227,692 $ 342,491.00 BC Montréal, Creeping red fescue seeds, for sowing, certified Poland Water 561,304 $ 880,839.00 QU Total 1,810,337 $ 2,977,860 Source: Statistics Canada – PREDA/REDI Custom Request Note: Certified indicates confirmation of seed type. It does not relate to organic. Calvin Yoder – Forage Seed Specialist Alberta Agriculture (Spirit River, AB Office)

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Alberta 2017 Export Revenues - Creeping Red Fescue – To USA – Distribution by State , Volume (CA$) Volume State Export Point Value $CA (KGM) California Abbotsford, BC 8,542 $23,856.00 Colorado North Portal, SK 19,051 $43,388.00 Idaho Coutts, AB 50,802 $81,285.00 Idaho Kingsgate, BC 37,875 $69,067.00 Creeping Red Fescue Illinois North Portal, SK 19,051 $59,969.00 Illinois Emerson, MB 212,262 $571,988.00 Illinois North Portal, SK 77,111 $209,153.00 Illinois Sprague, MB 19,051 $57,824.00 Indiana Emerson, MB 248,570 $651,324.00 Kentucky Emerson, MB 9,526 $26,628.00 Kentucky North Portal, SK 15,422 $40,863.00 Maine Stanstead, QU 9,526 $24,096.00 Maryland Emerson, MB 11,793 $28,752.00 Maryland Fort Erie, ON 19,051 $43,166.00 Maryland North Portal, SK 57,153 $142,184.00 Massachusetts Emerson, MB 303,910 $829,762.00 Massachusetts Fort Erie, ON 28,123 $64,060.00 Massachusetts Lansdowne, ON 19,051 $40,365.00 Massachusetts North Portal, SK 95,255 $217,802.00 Michigan Emerson, MB 84,369 $216,293.00 Michigan North Portal, SK 166,016 $433,901.00 Michigan South Junction, MB 38,102 $93,655.00 Minnesota Emerson, MB 11,000 $37,229.00 Minnesota Boissevain, MB 19,051 $51,326.00 Minnesota Emerson, MB 556,215 $1,393,671.00 Minnesota North Portal, SK 172,368 $449,010.00 Missouri Emerson, MB 18,144 $45,374.00 Missouri Boissevain, MB 19,051 $45,258.00 Missouri Emerson, MB 131,178 $302,522.00 Missouri North Portal, SK 153,315 $358,343.00 Montana Coutts, AB 4,535 $12,946.00 Montana Coutts, AB 194,229 $509,288.00 N Carolina Emerson, MB 57,153 $155,201.00 N Carolina North Portal, SK 19,052 $55,294.00 N Hampshire St-Armand, Qu 19,051 $51,818.00 Nebraska North Portal, SK 19,958 $54,718.00

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Alberta 2017 Export Revenues - Creeping Red Fescue – To USA – Distribution by State , Volume (CA$) Volume State Export Point Value $CA (KGM) New Jersey Emerson, MB 26,173 $69,900.00 New Jersey Fort Erie, ON 103,370 $290,885.00 New Jersey North Portal, SK 30,980 $81,653.00 New York Emerson, MB 48,081 $129,546.00 $25,318,078 New York Fort Erie, ON 97,502 $250,841.00 Sold to USA New York North Portal, SK 38,102 $101,381.00 North Dakota Emerson, MB 201,396 $504,879.00 North Dakota North Portal, SK 9,979 $27,438.00 Ohio Emerson, MB 50,802 $139,241.00 Ohio Fort Erie, ON 58,967 $109,332.00 Ohio North Portal, SK 113,036 $277,731.00

Ohio South Junction, MB 13,608 $74,787.00 Oregon Abbotsford, BC 76,872 $207,120.00 Oregon Pacific Highway, BC 19,958 $58,349.00

Oregon Abbotsford, BC 1,359,290 $3,497,861.00 Oregon Kingsgate, BC 138,233 $349,549.00 Oregon Osoyoos, BC 708,469 $1,860,375.00

Oregon Pacific Highway, BC 2,312,483 $6,146,588.00 Pennsylvania North Portal, SK 4,536 $10,997.00 Pennsylvania Emerson, MB 268,575 $710,649.00 Pennsylvania Fort Erie, ON 86,183 $220,738.00 Pennsylvania North Portal, SK 147,872 $367,701.00 Tennessee Emerson, MB 40,732 $78,909.00 Tennessee North Portal, SK 57,153 $141,664.00 Vermont St-Armand, Qu 66,225 $179,341.00 Vermont St-Bernard. QU 32,024 $81,470.00 Virginia Emerson, MB 14,515 $36,558.00 Virginia North Portal, SK 19,345 $49,811.00

Washington, Kingsgate, BC 1,814 $5,889.00 Washington, Kingsgate, BC 46,268 $122,084.00 Washington, Osoyoos, BC 14,515 $38,461.00

Wisconsin Emerson, MB 523,407 $1,346,751.00 Wisconsin North Portal, SK 97,976 $258,220.00 Total 9,772,353 $25,318,078.00

Source: PREDA/REDI – Canada Customs – Special Request

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TIMOTHY VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Timothy is a relatively short-lived, cool- season perennial that grows in stools or clumps and has a shallow, compact, and fibrous root system. There are approximately 1,152,000 seeds per pound. Timothy is different from most other grasses in that 1 or occasionally 2 of the basal internodes of the stem swell into a bulb-like growth. This characteristic is often used for identification of the plant during is early stages of growth.Timothy is used mainly for hay, but also for pasture and silage. It is palatable and nutritious. It makes an excellent companion grass for alfalfa and clover since it does not compete with legumes. Alberta 2017 Export Revenues – Timothy Grass Seeds By Country, Export Point, Transport Mode, and Volume Volume Country Export Point Mode Value $CA (KGM) Belgium Montréal, QU Water 75,080 $ 153,528.00 Denmark Montréal, QU Water 4,005 $ 7,946.00 Finland Montréal, QU Water 75,240 $ 159,634.00 France Montréal, QU Water 25,000 $ 48,510.00 Germany Montréal, QU Water 219,160 $ 505,715.00 Japan Vancouver, BC Water 32,260 $ 74,844.00 Latvia Montréal, QU Water 25,080 $ 31,852.00 Netherlands Montréal, QU Water 17,950 $ 32,450.00 Poland Montréal, QU Water 149,825 $ 317,204.00 UK Montréal, QU Water 25,000 $ 55,125.00 Japan Vancouver, BC Water 18,144 $ 32,689.00 Total 666,744 $ 1,419,497 Source: PREDA/REDI – Canada Customs – Special Request

The table above shows that there were 11 export shipments of Timothy Seeds from Alberta in the year 2017. Most of these export shipments went to Europe. The largest value for Timothy exports for Alberta is in the Hay exports. With 66 export shipments weighting in at 200K+ tonnes and a revenue value of $CA79.6 Million sold across 14 countries in the year 2017, Timothy Hay grown in the Northwest is internationally renowned for its nutritional quality with Cattle. This recognition is in no small part due to the 65 years of export marketing, package innovation, and nutritional monitoring of one farm family in the Peace Country. The Lavoie Family of St. Isadore, AB (Northern Sunrise County).

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TIMOTHY VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Timothy hay has a very distinctive green coloring when it is first baled (It almost looks like a salad roll! Mmm… I can see why the cows love it!) Photo: Lavoie Farms, St. Isadore 1953, the Lavoie family sealed a 160-acre homestead in Northern Alberta. The family worked together to clear the land and build a new farm. Today, the Lavoie family farm is home to 400 dairy cows and multiple grain & hay operations that extend over 20,000 acres (Macay Enterprises Inc.) Establishing a farm in Northern Alberta requires dedication and innovation. In 1995, while already working for a hay exporter, Evans Lavoie knew that a new method had to be developed to ensure a consistent supply of high-grade Timothy grade to export. In response, the Lavoie family developed special machinery and new quality control processes that no other companies use – compact baling – which allows for maximum product in shipping containers while maintaining the highest level of nutritional quality.

Timothy is your low-cost option of increasing fiber in your cow’s diet. Your cows will last longer with better conditioning and have higher fat content in milk. ADVANTAGES Low Potassium Safe for feeding baby cows, dry cows. and milking cows. High Palatability Comes from the Peace Region which is renowned for higher sugar content When fed at a younger age increases stomach capacity for increased milk production in the future.

Today the Lavoie family farms are operated by the sons of the senior Lavoie brothers that originally broke the ground and focused to build their expertise on Cattle, Timothy Hay and quality control exporting.

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TIMOTHY VERY IMPORTANT CROP IN NORTHWEST ALBERTA

Source: PREDA/REDI – Canada Customs – Special Request Alberta 2017 Exports Revenues – Timothy Hay – By Country, Export Point, Mode of Transport, and Volume Transport Volume Country State Export Point Mode (Tonnes) Value $CA China Calgary, AB Air 652 187,031 China Vancouver, BC Water 3,973 1,227,058 China Vancouver, BC Air 91 28,668 Dom REP Vancouver, BC Water 48 14,813 India Vancouver, BC Water 25 7,465 Ireland Montréal, QU Water 25 10,387 Ireland Vancouver, BC Water 128 38,870 Japan Calgary, AB Air 5,593 2,147,300 Japan Prince Rupert, BC Water 2,366 585,530 Japan Vancouver, BC Water 135,268 48,781,186 Japan Vancouver, BC Air 601 229,848 Malaysia Vancouver, BC Water 556 167,048 Netherlands Montréal, QU Water 681 206,213 Qatar Vancouver, BC Water 126 24,741 Singapore Vancouver, BC Water 459 130,862 South Korea Calgary, AB Air 527 189,515 South Korea Edmonton, AB Air 112 33,901 South Korea Prince Rupert, BC Water 5,704 1,572,160 South Korea Vancouver, BC Water 26,738 8,683,418 South Korea Vancouver, BC Air 390 129,531 Taiwan Vancouver, BC Water 62 21,191 Taiwan Vancouver, BC Air 49 24,236 Thailand Vancouver, BC Water 661 197,682 Thailand Vancouver, BC Air 58 17,266 UAE Calgary, AB Air 888 199,139 UAE Vancouver, BC Water 2,700 812,354 UK Montréal, QU Water 240 74,843 UK Vancouver, BC Water 175 55,420 USA Washington, Abbotsford, BC Road 18 6,308 USA Maine Armstrong, QU Road 5 2,888 USA Arizona Coutts, AB Rail 14 8,050 USA California Coutts, AB Road 40 12,849 USA Florida Coutts, AB Road 69 39,877 USA Nevada Coutts, AB Road 323 148,463 USA Washington, Coutts, AB Road 19 9,384

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Alberta 2017 Exports Revenues – Timothy Hay – By Country, Export Point, Mode of Transport, and Volume Transport Volume Country State Export Point Mode (Tonnes) Value $CA USA Wisconsin Coutts, AB Road 1,929 715,595 USA Wyoming Coutts, AB Road 81 21,190 USA Florida Emerson, MB Road 38 24,656 USA Tennessee Emerson, MB Road 17 8,473 USA Wisconsin Emerson, MB Road 1,221 434,477 USA New York Fort Erie, ON Road 18 12,618 USA Alabama Fort Frances, ON Rail 72 40,631 USA Florida Fort Frances, ON Rail 575 366,176 USA New York Fort Frances, ON Rail 18 11,171 USA Wisconsin Fort Frances, ON Rail 8,957 2,890,760 USA Washington, Kingsgate, BC Road 1,985 668,520 USA Arkansas North Portal, SK Rail 18 10,870 USA California North Portal, SK Rail 35 21,907 USA Florida North Portal, SK Rail 12,708 7,047,511 USA Florida North Portal, SK Road 68 40,897 USA Michigan North Portal, SK Rail 20 9,163 USA Montana North Portal, SK Rail 17 7,089 USA New York North Portal, SK Rail 363 212,184 USA New York North Portal, SK Road 19 13,284 USA North Carolina North Portal, SK Rail 40 30,055 USA Tennessee North Portal, SK Rail 57 32,375 USA Washington, North Portal, SK Rail 441 213,228 USA Wisconsin North Portal, SK Road 1,266 437,013 USA Washington, Pacific Highway, BC Road 17 6,557 USA Maine Stanstead, QU Road 13 8,242 USA New York St-Armand, QU Road 6 2,973 USA Maryland St-Bernard, QU Road 46 16,407 USA New Jersey St-Bernard, QU Road 25 13,958 USA New York St-Bernard, QU Road 269 147,161 USA Pennsylvania St-Bernard, QU Road 259 166,507 USA Arkansas Windsor, ON Road 6 10,730 Total 219,988 $ 79,667,873

65% of all export revenues in 2017 from the sale of Timothy Hay comes from sales to JAPAN $CA 51,743,864.

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HEMP EMERGING ALTERNATIVE CROP

Canadian hemp is sold as seeds for food to markets in the United States and Asia, and interest is surging for health products. That, coupled with the versatility of hemp fibre for manufacturing, has some predicting the export market could balloon from $140 million in sales this year to $1 billion within five years – with Alberta as a potential “hemp hub.”

Finding accurate data on hemp acres, production, and exports is challenging. Typical field crops include wheat, canola, oats and barley; which have been tracked and reported for decades. In contrast, agricultural products such as hemp fall under “other field crops” and are batched together for summary reporting. The Census of Agriculture is the only statistical program that collects data on emerging and minor agricultural products. The “other” commodities are collected by the Census program using write‑in fields, which are then coded and grouped into similar product classes. Agriculture Canada has only just begun to formally report data on hemp so comparative long-term data is not available.

Canada 2016 - Other Crop Area (Acres)

Crop / Canada Total NL PEI NS NB Qu On MB SK AB BC

Fenugreek 2,809 0 0 0 0 0 0 0 2,809 0 0 Spelt 15,958 0 68 0 0 3,435 7,365 1,122 2,851 818 299 Quinoa 11,868 0 0 0 0 x 352 905 9,525 1,042 x Camelina 2,703 0 0 x 0 246 x x 2,211 x 0 Hemp (industrial) 45,245 0 x 0 x 2,149 732 12,929 13,329 15,689 296 Hops 789 0 x 22 13 101 175 x x 3 454 Gooseberries 42 0S 1 2 2 24 8 1 x x 1 Currants 427 5 30 10 3 142 73 5 46 62 52 Sea buckthorn 520 x 0 x 0 365 30 42 41 31 8 Kiwi 58 0 x x 0 x 12 0 0 0 40 Haskaps and other berries 1,761 2 12 195 74 655 148 26 341 169 139 Garlic 2,207 5 6 31 17 582 976 18 18 69 485 Kale 448 1 1 20 2 19 328 16 2 4 58 Sweet potato 1,776 0 4 x x 3 1,755 2 x 0 5 Chinese vegetables 2,356 x 0 0 x 6 1,953 x 0 1 395

Source: Statistics Canada, Census of Agriculture – Special Report Innovation and healthy living propel growth in certain other crops (March 2018)

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HEMP EMERGING ALTERNATIVE CROP

Hemp Products 2017 Detailed: There have been numerous discussions (and investments in related research) in the Northwest with regards to the potential of hemp growing in the region. Though it is challenging to get a full baseline on the productivity and land dedicated to the crop, export data, shown below, does give a glimpse of the economic activity of the hemp industry. The data presented below was received through a customized request to Statistics Canada.

Source: Statistics Canada – PREDA/REDI Custom Request

Canada – Hemp Product Exports – Volume and Value Volume (KGM) Value $CA The table shows that the export revenues 2017 11,200,206 $ 76,510,941 generated from the sale of hemp products has 2016 26,913,206 $ 132,698,210 been significant; with a peak of $CA 2015 17,769,358 $ 79,038,932 2014 3,542,027 $ 36,349,467 132.7Million in the year 2016. 2013 2,880,774 $ 31,373,386 In the year 2017 Canada Customs cleared a total of 281 export shipments of hemp products. The table below shows the province of Manitoba accounted for 74% of Canada’s export revenues generated from the sale of hemp products in the year 2017. Also, most of the export revenues generated were accounted for through the sales of hemp seeds.

Source: Statistics Canada – PREDA/REDI Custom Request Canada – 2017 Hemp Product Exports – By Province Volume #Export Province (KGM) Value $CA Shipments Canada 2017 Export Value - Hemp Products AB 1,372,425 $ 3,892,951 23 Oil, BC 713,891 $ 7,852,344 51 Fibre, $516,257 $11,348 MB 8,174,824 $ 56,752,009 108 ,933 ON 60,409 $ 189,580 22 QU 239,740 $ 3,465,323 21 SK 638,917 $ 4,358,734 56 Total 11,200,206 $ 76,510,941 281 Seeds, $64,645 ,751

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HEMP EMERGING ALTERNATIVE CROP

Hemp Products 2017 Detailed:

The table below shows Canada’s 2017 hemp product export by country. Overall the largest sales go to the United States (seeds). South Korea and the Netherlands also show significant revenues generated (seeds).

Canada 2017 Hemp Products Exports – By Country Country Fibre ($CA) Oil ($CA) Seeds ($CA) Total Value $CA Algeria 156,863 156,863 Australia (5) 41,189 218,199 259,388 Belgium (1) 3,636 118,423 122,059 Cayman Islands 44,990 44,990 Chile 3,077 3,077 China 375 375 Costa Rica 65,688 65,688 Finland 488,705 488,705 France 83,156 184,393 267,549 Germany (4) 328,661 327,095 100,026 732,121 Greece 59 59 Hong Kong 1,952 2,189 4,141 Ireland 99,000 99,000 Israel (4) 36,788 36,788 Italy 567 521,086 521,653 Japan (4) 246,504 205,202 451,706 Malaysia 14,628 14,628 Mexico 3,196 3,196 Netherlands 197,318 2,161,221 2,358,539 New Zealand (3) 167,886 167,886 Panama 244 244 Philippines 876 5,439 6,315 Poland 312,038 312,038 Singapore 216 937 1,153 Slovakia 500,200 5,451 505,651 South Africa (3) 55,746 45,975 101,721 South Korea 553,896 6,224,144 6,778,040 Spain 176 79,475 79,651 Trinidad and Tobago 2,976 2,976 United Kingdom (4) 13,969 239,126 1,630,390 1,883,485 United States (52) 87,399 8,915,836 52,014,360 61,017,595 Totals 516,257 11,348,933 64,645,751 76,487,280

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Pastureland - Animal and Animal Products In 2017 Alberta generated $3.2 billion in export revenues from the sale of animals and animal products. Fresh beef accounted for almost a 1/3 of all export revenues generated. The table below shows Alberta’s animal products exported and the percent of these sales that were sold to the US.

Alberta 2017 Export Revenues – All Animal Products Total $CA % US Total $ 3,213,370,215 68% HS 0201 - Meat of Bovine Animals -- Fresh or Chilled $ 1,209,582,146 91% HS 0102 - Live Bovine Animals $ 642,420,195 100% HS 0203 - Meat of Swine - Fresh, Chilled or Frozen $ 461,017,035 31% HS 0202 - Meat of Bovine Animals - Frozen $ 350,549,001 11% HS 0206 - Edible Offal - Bovine, Swine, Sheep, Goat, Horse, Ass, Mule, Hinny - Fresh, or Frozen $ 213,075,000 44% HS 051110 - Bovine Semen $ 60,843,402 55% HS 0103 - Live Swine $ 58,894,679 100% HS 0504 - Guts, Bladders and Stomachs of Animals (Other than Fish) $ 43,858,302 16% HS 0205 - Meat of Horses, Asses, Mules or Hinnies - Fresh, Chilled or Frozen $ 38,517,004 0% HS 040900 - Honey, Natural $ 27,150,428 78% HS 0101 - Live Horses, Asses, Mules and Hinnies $ 17,145,085 31% HS 0209 - Pig Fat, Free of Lean Meat, and Poultry Fat, Not Rendered or Otherwise Extracted, Fresh $ 12,237,840 2% HS 0402 - Milk/Cream - Concentrated or in Powder $ 10,537,790 0% HS 0106 - Other Live Animals Nes (Including Fishing Bait) $ 8,580,761 100% HS 0207 - Meat and Edible Offal of Domestic Poultry - Fresh, Chilled or Frozen $ 6,791,656 1% HS 010641 - Insects: Bees $ 4,975,743 100% HS 0210 - Meat and Edible Offals of Bovine, Swine and Other - Salted, Brine, Dried or Smoked $ 4,519,114 51% HS 0506 - Ossein, Bones and Horn-Cores $ 3,274,154 80% HS 0208 - Meat and Edible Offal of Rabbits, Frogs and Other Animals - Fresh, Chilled or Frozen $ 3,056,285 87% HS 0507 - Ivory, Whalebone, Horns, Hooves, Tortoise-Shell, Antlers, Nails, Claws, Beaks $ 3,045,800 14% HS 152190 - Beeswax, Other Insect Waxes and Spermaceti $ 2,658,269 100% HS 0510 - Glands, Bile and Animal Products Used To Prepare Pharmaceutical Products $ 945,224 2% HS 0408 - Bird Eggs Not in Shell and Egg Yolks $ 438,649 100% HS 0204 - Meat of Lamb, Sheep and Goats - Fresh, Chilled or Frozen $ 438,176 24% HS 0306 - Crustaceans - Whether in Shell or Not, Live Fresh, Chilled Frozen Salted Brine; Smoked, $ 412,878 4% HS 0406 - Cheese and Curd $ 400,214 51% HS 0405 - Butter, Dairy Spreads and Other Fats and Oils Derived from Milk $ 382,597 23% HS 0404 - Whey and Products Consisting of Natural Milk Constituents $ 149,268 0% HS 0307 - Molluscs, Whether in Shell or Live, Fresh, Chilled, Frozen Dried, Salted Brine, Smoked $ 89,644 0% HS 0105 - Live Poultry and Turkeys $ 86,942 100% HS 0505 - Skin, Feathers and Other Parts of Birds $ 53,276 0% HS 0303 - Frozen Fish (Excl Fish Fillets) $ 34,650 0% HS 0302 - Fresh or Chilled Fish (Excl Fish Fillets) $ 20,357 100% HS 0410 - Edible Products of Animal Origin Nes $ 19,348 93% HS 0104 - Live Sheep and Goats $ 13,700 0% HS 0305 - Fish (Incl. Fish Meal) - Dried, Salted, Smoked or in Brine $ 5,175 0%

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BOVINE (Cattle) VERY IMPORTANT LIVESTOCK IN NORTHWEST ALBERTA Northwest Alberta counted 285,771 heads of cattle in 2016. The categories shown above represent different sections of the cattle industry that either use cattle for meat, for breeding, or for milking.

2.3A Northwest Alberta - Cattle Inventory – Headcount (2016) Heifers Cows Calves Steers Slaughter Replacement Beef Dairy Bulls Total Canada 4,045,274 1,573,232 903,741 1,113,397 3,732,555 939,071 223,460 12,530,730 Alberta 1,649,706 902,839 573,834 329,339 1,576,354 80,014 94,913 5,206,999 NW-AB 94,226 25,345 10,170 24,898 122,855 1,036 7,241 285,771 N. Sunrise 1,780 142 x 430 x x 181 5,712 Big Lakes 10,023 1,292 1,444 2,175 12,342 5 649 27,930 Lesser Slave 3,332 166 94 869 x x 309 10,258 Clear Hills 7,059 2,997 981 2,481 12,440 42 732 26,732 N. Lights 7,481 4,445 x 2,380 x x 701 26,552 Mackenzie 6,173 223 287 1,448 6,424 71 423 15,049 Greenview 13,782 3,401 x 3,413 x x 961 41,121 County GP 23,582 7,987 2,330 6,594 26,487 28 1,646 68,654 Smoky River 2,153 359 146 0 x x 124 6,264 Birch Hills 3,529 1,729 x 822 x x 354 12,783 Spirit River 921 247 x 0 1,560 0 76 3,184 Saddle Hills 9,818 1,187 667 1,781 x x 675 26,429 Fairview 2,054 653 447 896 x x 180 7,482 Peace 2,539 517 331 371 x x 230 7,621 Census of agriculture - Table: 32-10-0424-01 Cattle and Calves *suppressed or None

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BOVINE (Cattle) VERY IMPORTANT LIVESTOCK IN NORTHWEST ALBERTA

Fresh Beef! Will always garner premium prices however, the variable of time to transport can wreak havoc on such delicacies. Recall: “The first rule of thumb for trade is proximity. The closer you are the more likely it is there will be trade; especially if you both have something the other wants.” Source: “Gravity Model of Trade”- Foreign Affairs Canada

This is especially true for premium grade fresh Alberta Beef! The United States accounted for 91% of all revenues generated from the export of fresh beef. Alberta Exports – Bovine Fresh ($CA) 2016 2017 Alberta 2017 Export Revenues HS 0201 - Meat of Bovine Animals -- Fresh United States 1,083,728,609 1,100,749,722 California $ 440,392,340 Mexico 69,531,403 72,750,275 Texas $ 102,523,360 Japan 15,015,184 15,286,237 Michigan $ 61,242,670 Netherlands 2,657,414 6,559,420 Wisconsin $ 50,505,521 Korea, South 298,817 4,950,464 Illinois $ 47,178,477 Switzerland 3,353,660 2,630,975 Idaho $ 28,759,721 Chile 2,120,264 2,165,774 Nebraska $ 27,500,346 Taiwan 88,219 2,250,834 Ohio $ 27,146,616 New York $ 26,383,943 The US loves Alberta Beef; especially Californians! Oregon $ 25,160,578 Even Texas, the only other place branded for its quality Colorado $ 24,658,268 New Jersey $ 22,466,173 of “steak”, imports more than $100 Million of fresh North Carolina $ 20,974,709 Georgia $ 20,175,926 Alberta beef. Cattle is a very important livestock to Washington $ 19,328,957 Northwest Alberta. Yet for decades efforts to have Florida $ 18,877,958 South Dakota $ 18,744,800 inter- provincial approved slaughter and processing Sub-total US $ 1,100,906,840 91% facilities have been unsuccessful (let alone Others $ 108,675,306 Total All Countries $ 1,209,582,146 international grade).

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BOVINE (Cattle) VERY IMPORTANT LIVESTOCK IN NORTHWEST ALBERTA

In 2017 there were eighty export shipments of frozen beef (Bovine). Eleven of these export shipments were delivered to the buyer using Air services. Forty-one of these export shipments were delivered using trucks (specialized reefer containers) to the United States and Mexico. Almost all these truck shipments went through the export point in Alberta at Coutts. The remaining shipments were trucked to at tidewater export points; the majority being Vancouver.

Alberta Exports – Bovine Frozen ($CA) 2015 2016 2017 What is of interest relative to this report is Hong Kong 58,090,196 131,635,270 130,338,844 China 234,761,043 59,049,860 72,875,287 the higher ratio of value to volume when Japan 24,266,452 41,992,082 57,518,841 comparing air delivery vs. truck delivery. US 29,320,319 21,683,496 39,940,746 S Korea 3,093,881 31,890,278 16,594,893 Even though the air delivery volume is Taiwan 416,676 5,557,474 22,501,541 significantly smaller than the truck Vietnam 86,822 1,683,191 3,662,285 Philippines 4,256,579 4,190,787 1,882,143 delivery; the value per KGM is Mexico 1,946,955 879,486 1,035,350 significantly higher for the “air” sales. Air Cuba 3,604,048 1,768,236 1,745,214 Total $CA delivery sales are “premium sales”; this Top Countries 359,844,986 300,332,176 348,097,161 could be a niche market for the Northwest % Export Revenues 99% 99% 99% agriculture.

Alberta 2017 Exports – Bovine Frozen – By Air Volume Destination Export Point (KGM) Value $CA Source: Statistics Canada – PREDA/REDI Custom Request Chile Calgary 1,271 26,116

China Vancouver 20,666 218,018 France Calgary 86,066 913,058 Alberta 2017 Exports – Bovine Frozen by Truck United States Coutts, Hong Kong Vancouver 23,217 118,723 (39 Shipments) AB* 7,376,417 39,639,552 Japan Vancouver 68,686 331,484 Mexico Coutts, Switzerland Calgary 21,012 223,161 (2 Shipments) AB 138,443 1,035,350 Switzerland Montreal 1,454 15,451 Total 7,514,860 $40,674,902 Value per KGM = Volume / Payment Received $5.40 Taiwan Vancouver 21,881 133,276 * Two shipments were exported St-Bernard-de-Lacolle, OU Viet Nam Victoria 154 1,355 Viet Nam Sidney 649 7,003 Viet Nam Vancouver 24,150 167,555 Total 269,206 $2,155,200 Value per KGM = Volume / Payment Received $8.00

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SWINE (PIGS) VERY IMPORTANT LIVESTOCK IN NORTHWEST ALBERTA Bacon, ham, pork-chops. Consumer level products all from the swine industry. In Canada alone there are 130 branded consumer level products using Canadian pork. The table below shows the headcount of the live swine in Canada, Alberta, and the Northwest region. Like the cattle industry, the categories shown represent different sections of the swine industry that are either used for meat or for breeding.

Northwest Alberta – Swine Inventory (Headcount) Grower Sows Nursing and

Boars and Gilts Sows Weaners Finishers Total Canada 19,119 1,210,031 1,903,325 3,341,358 7,617,670 14,091,503 Alberta 4,941 121,562 211,333 312,555 811,856 1,462,247 NW-AB 289 8,234 13,888 26,989 62,446 111,846

N. Sunrise x x 0 0 x x Big Lakes 13 10 x x 44 76 Lesser Slave x x x x x x Clear Hills 23 83 39 38 264 447

N. Lights 10 43 57 24 18 152 Mackenzie 33 119 171 254 741 1,318 Greenview 10 25 32 81 42 190 County GP 87 x 2,116 x x x

Smoky River x x x x x x Birch Hills 66 1,355 2,200 3,357 9,851 16,829 Spirit River x x 0 x 0 16 Saddle Hills 9 36 50 x 26 x

Fairview 3 16 x x x x Peace 10 21 x x 29 x Census of Agriculture Table: 32-10-0426-01 * suppressed OR none Pig farm terminology Term Definition Term Definition Term Definition Young pigs around 6 – 10 A pig that weighs around 280 Another word for weeks old. Often produced by Market pounds. It is approximately 6 Abattoir Feeder pigs slaughterhouse. one farm then purchased and Hog months old and was raised to for finished on another farm. slaughter. Male pig castrated The process of feeding a pig A female pig that has given birth Barrow before sexual Finishing so that it reaches market Sow to at least one litter of piglets. maturity. weight. A young female pig that has Boar Male pig. Gilt Swine General term for all pigs. not produced a litter of piglets.

To give birth to A pig that weighs between 40 Weaner A pig that has been recently Farrow Grower pig piglets. and 220 pounds. pig weaned from its mother.

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SWINE (Pigs) VERY IMPORTANT LIVESTOCK IN NORTHWEST ALBERTA The volume of pork products exported in Canada has steadily increased; especially in the last 2 decades. As shown in the table Quebec is by far the largest exporter of swine products. Source: Industry Canada – Trade Data Canada Export Swine - fresh, chilled or frozen ($CA) HS 0203 Quebec 1,407,904,889 Manitoba 879,651,889 Alberta 461,017,035 Ontario 460,717,549 British Columbia 100,976,389 Saskatchewan 3,774,639 New Brunswick 370,034 Nova Scotia 187,949 Nunavut 103,611 Prince Edward Island 90,138

Source:

The largest export markets for Alberta Fresh Swine is Japan and then the US. The same is true of frozen swine products however at significantly less revenues.

Alberta Export of Swine – Fresh (CA$) 2015 2016 2017

Japan 167,669,270 185,511,563 184,432,439 United States 113,246,744 112,239,552 122,672,557 Alberta Pork Producers Development Corporation Korea, South 24,286,134 28,100,439 31,790,852 (Alberta Pork) is a non-profit organization representing Mexico 6,269,202 13,003,667 13,726,230 the province’s registered hog producers before government, industry partners, and media. Source: Industry Canada – Trade Data

Alberta Export of Swine – Frozen (CA$) 2015 2016 2017 Japan 27,717,533 23,523,144 25,558,687 United States 19,266,553 18,463,459 19,613,202 Korea, South 18,911,011 15,287,255 13,211,129 New Zealand 8,096,548 8,787,098 9,231,340 China 9,303,450 10,689,386 11,480,364 Philippines 6,715,210 8,558,088 9,014,756 Taiwan 8,985,320 3,329,530 5,096,918 Australia 20,424,959 13,385,782 6,911,974 Mexico 2,460,777 1,543,224 2,145,815 Hong Kong 573,151 1,698,580 2,019,405

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SWINE (Pigs) VERY IMPORTANT LIVESTOCK IN NORTHWEST ALBERTA

Transporting Pork (Swine) Products:

In 2017 there were 186 shipments of pork products exported from Alberta (113 shipments were of fresh products and 73 shipments were of frozen products). Half of all of Alberta’s pork product shipments (93) went to the United States and they were all exported by road transport; repesenting 37,781,240 KGM of pork product at a value of $142 Million in export revenues for Alberta.

Alberta 2017 Pork Exports – US ($CA) Source: Statistics Canada – PREDA/REDI Custom Request HS 0203 Fresh & Frozen Swine Products California 85,919,908 Transport of Pork Products to US Michigan 22,338,813 Iowa 12,741,862 100% Truck Illinois 6,874,747 South Dakota 4,686,699 Wisconsin 2,804,395 Washington 1,693,518 Oregon 777,665 Colorado 662,033 Ohio 616,553

Mississippi 414,846

Utah 351,476 New Jersey 290,418 Transport of Pork Products – Other Countries Rhode Island 268,890 90 Export Shipments Delaware 234,213 Nevada 203,143 Air 31 Export Shipments = 34% Puerto Rico 198,392 Montana 195,285 Missouri 191,418 Nebraska 176,875 North Dakota 156,708

Kansas 108,333 Truck 7 Export Shipments (Mexico) = 8% Minnesota 107,850 New York 91,578 Virginia 63,441 North Carolina 56,878 Ship 52 Export Shipments = 58% Arkansas 33,438 Pennsylvania 22,369 Texas 4,015 US Total $142,285,759 Other Countries 318,731,276 Total All Countries $461,017,035

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POULTRY VERY IMPORTANT IN NORTHWEST ALBERTA On a global scale, poultry is the most ecologically sustainable and economical sources of protein. Unlike beef and pork, the consumption of poultry does not get negatively impacted by religions or climate change activists. The simplicity of poultry is one of its greatest advantages. In developing countries poultry can live within the family radius with very little land and feed expenses. Also, the whole animal is a meal on the table with no need for high-end slaughterhouses, specialty cuts and/or packaging. Poultry also provides eggs as a “recurring” source of protein. Because of the simplicity of poultry breeding, egg production, and “ready for the oven” whole animal characteristics, there is not a lot (monetary value) of international trade of poultry raw products (or live animals). Industrial level production of eggs and poultry meat tends to stay within a country.

Northwest Alberta Poultry Inventory – Headcount Census Day (2016)

Hens Layer Broilers and

Layers Only and Breeder Roasters Turkeys Other Total Canada 35,988,028 6,629,416 102,902,122 8,423,900 3,017,373 145,519,566 Alberta 3,306,652 650,582 10,168,167 768,529 170,757 14,125,401 NW-AB 170,500 1,519 123,880 64,794 7,906 295,899 N. Sunrise 103 x x x 102 277 Big Lakes 1,171 107 360 80 174 1,638 Lesser Slave 463 x x x x 499 Clear Hills 1,476 135 1,786 135 115 3,397 N. Lights 1,259 97 785 95 x 2,141 Mackenzie 5,622 443 7,261 509 115 13,326 Greenview 5,126 17 54,771 x 746 59,914 County GP 16,786 348 1,977 x 2,180 19,111 Smoky River 0 x 311 x x x Birch Hills 0 x x x 3,501 x Spirit River 306 30 x x 7 x Saddle Hills 1,099 37 702 79 x 1,838 Fairview 334 0 x 155 21 x Peace 163 x x 0 x x

Highlight

Found in the coolers of 24 communities in 40+ retail stores, the demand for Ridge Valley poultry products continues to exceed the supply - now 10 times the size of the original farm 40 decades ago, Ridge Valley is in the MD of Greenview.

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LIVE ANIMALS VERY IMPORTANT IN NORTHWEST ALBERTA

Northwest Alberta has a small but varied number of other livestock. As shown in the table below, horses, goats, sheep, rabbits, etc. . make up the variety of animals supported on the Northwest pasture lands. These livestock may be raised and used for meat, fur/wool/leather products, and/or recreational tourism. Collectively they represent almost 50,000 animals that require feed, water, land access, and veterinary services; hence they contribute a significant economic factor overall to the Northwest agriculture industry.

The largest “Other” livestock in the Northwest is Bison at 15K+ headcount in 2016; more than 1/3 of this headcount is in the County of Grande Prairie. Sheep and horses account for most of the remaining “Other” livestock in the Northwest region.

Northwest Alberta Other Livestock – Headcount (2016) Headcount Horses Goats Laamas/ Rabbits Bison Elk Sheep Total Alpaca Canada 291,561 230,034 20,927 172,489 119,314 22,058 1,054,260 1,910,643 Alberta 108,702 27,955 5,807 4,917 54,907 11,904 195,511 409,703 NW-AB 11,490 2,696 687 954 15,885 3,198 12,667 47,577 N. Sunrise 194 x 11 x 2,017 0 x 2,222 Big Lakes 744 147 x x 211 x 1,271 2,373 Lesser Slave 237 x x x 446 x x 683 Clear Hills 1,424 358 52 72 560 146 874 3,486 N. Lights 961 458 44 29 1,442 666 1,033 4,633 Mackenzie 717 x 26 110 114 x 1,011 1,978 Greenview 1,488 425 91 344 4,158 353 1,447 8,306 County GP 3,518 501 231 230 5,953 887 2,624 13,944 Smoky River 249 0 x x x x x 249 Birch Hills 300 x 16 x x 0 x 316 Spirit River 266 x x x 0 x x 266 Saddle Hills 943 226 104 59 678 x 884 2,894 Fairview 273 140 x 4 x x 811 1,228 Peace 176 15 x 20 128 0 481 820

Source: Census of Agriculture

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LIVE ANIMALS VERY IMPORTANT IN NORTHWEST ALBERTA

Though it may be a relatively small number of headcount for “Other” livestock in the Northwest, Alberta does generate a significant amount of export revenues from the sale of live animals. The summary tables below show the live animals exported - by type of animal and by country.

HS 0101 - Live Horses, Asses, Mules and Hinnies $ 17,145,085 Japan $ 11,639,959 United States $ 5,244,282 California 25% Belgium $ 121,500 Netherlands $ 29,500 France $ 28,000 Luxembourg $ 27,500 Germany $ 22,835 Austria $ 15,854 Switzerland $ 15,500

Cuba $ 155

HS 0102 - Live Bovine Animals $ 642,420,195

United States $ 641,257,788 Washington 70%

Korea, South $ 620,292

Mexico $ 486,915 United Kingdom $ 55,200 HS 0103 - Live Swine $ 58,894,679 United States $ 58,888,505 Oregon / Iowa 55% Romania $ 6,174 HS 0104 - Live Sheep and Goats $ 13,700 Israel $ 13,700 HS 0105 - Live Poultry and Turkeys $ 86,942

United States $ 86,942 Montana 75% Total All Countries - All Live Animals $ 718,560,601

Source: Industry Canada – Trade Data

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HONEY & BEES VERY IMPORTANT IN NORTHWEST ALBERTA

Alberta 2017 Export Revenues In 2017, Canada exported $60.8 Million worth Natural Honey of honey into the US. Alberta’s honey exports United States $ 21,154,470 78% Japan $ 5,823,940 were worth $27.2 million with 78% of the China $ 136,200 Hong Kong $ 35,818 product being exported to the United States. Total All Countries $ 27,150,428 Sales Description: “About half of the honey sold in the Alberta 2017 Export Revenues -US US is through retail channels, with the rest being sold in Natural Honey bulk or for use in the foodservice industry. Organic By Destination State California $ 4,023,631 honey continues to drive growth. Consumers buy most of Pennsylvania $ 2,942,978 their honey through grocery stores versus other formats. Illinois $ 2,404,527 Liquid honey continues dominance of the honey Kansas $ 1,901,897 category. Honey sold in glass jars and bottles Michigan $ 1,542,581 outperforms bear, jugs and tubs - 12 oz. seems to be the Ohio $ 1,105,544 most popular size.” Source: Alberta Agriculture Oregon $ 956,251 Georgia $ 845,792 Source: Industry Canada – Trade data Virginia $ 793,721 Texas $ 766,890 Alberta 2017 Export Revenues Bees New Jersey $ 742,173 By Destination State Minnesota $ 417,717 California $ 2,711,380 Connecticut $ 413,076 Washington $ 743,254 Arizona $ 388,514 Idaho $ 580,198 Missouri $ 379,494 Oregon $ 363,014 Utah $ 354,225 Montana $ 234,855 New York $ 314,453 Utah $ 201,520 North Carolina $ 229,843 Wyoming $ 141,522 Indiana $ 199,414 Sub-total US $ 4,975,743 100% Nevada $ 167,046 Total All Countries $ 4,975,743 Idaho $ 74,818 New Hampshire $ 72,509 What’s with exporting Alberta Bees to California? The Iowa $ 70,799 Wisconsin $ 46,577 humble honeybee plays an essential role in providing the Sub-total US $ 21,154,470 fresh fruits, vegetables, and nuts we enjoy in such abundance. In fact, bees pollinate around 70 % of the world’s crops. But there’s one food that requires far more bees to produce than any other – almonds. In the United States, production is concentrated in California, almonds being that state’s third leading agricultural product and its top agricultural export. California produces 80% of the world’s almonds and 100% of the U.S. commercial supply. The pollination of California's almonds is the largest annual managed pollination event in the world, with 1.4 million hives from the US and imported bees trucked into the almond groves. Researchers have developed a new line of self-pollinating almond trees which possess quality skin color, flavor, and oil content, in the attempt to reduce almond growers' dependency on insect pollination.

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HONEY & BEES VERY IMPORTANT IN NORTHWEST ALBERTA

Transporting Honey In 2017 Alberta exported 53 shipments of natural honey representing a total volume of 6,371,757 KGM at a value of $CA 27,150,428 in export revenues. Of these 53 export shipments, 49 went to United States. The table below shows the volume of natural honey exports by country, the amount of export revenues generated and the mode of transportation. Source: Statistics Canada – PREDA/REDI Custom Request Alberta 2017 Export Shipments of Honey – Volume, Transport Mode, and Value Country of US State of Canadian Destination Destination Clearance Port of Exit Transport Quantity (KGM) Value $CA China British Columbia Vancouver Road/Water 23,124 136,200 Hong Kong Alberta Calgary Road/Air 616 3,389 Hong Kong British Columbia Vancouver Road/Water 4,776 32,429 Japan British Columbia Vancouver Road/Water 1,442,272 5,823,940 US Arizona Alberta Coutts Road 75,776 360,955 US Arizona British Columbia Kingsgate Road 7,493 27,559 US California Alberta Coutts Road 787,850 3,552,861 US California British Columbia Abbotsford-Huntington Road 21,977 63,797 US California British Columbia Kingsgate Road 18,289 114,031 US California British Columbia Pacific Highway Road 71,205 292,942 US Connecticut Alberta Coutts Road 37,471 151,153 US Connecticut British Columbia Abbotsford-Huntington Road 18,869 103,220 US Connecticut British Columbia Pacific Highway Road 18,870 102,663 US Connecticut Ontario Fort Erie Road 18,146 56,040 US Georgia Saskatchewan North Portal Road 254,761 845,792 US Idaho Alberta Coutts Road 19,069 74,818 US Illinois Alberta Coutts Road 59,248 177,854 US Illinois Manitoba Emerson Road 278,471 1,472,377 US Illinois Saskatchewan North Portal Road 160,040 754,296 US Indiana Manitoba Emerson Road 56,357 199,414 US Iowa Manitoba Emerson Road 18,579 70,799 US Kansas Alberta Coutts Road 55,448 313,100 US Kansas Manitoba Emerson Road 278,591 909,183 US Kansas Saskatchewan North Portal Road 130,607 679,614 US Michigan Manitoba Emerson Road 316,976 1,224,665 US Michigan Saskatchewan North Portal Road 96,455 317,916 US Minnesota Manitoba Emerson Road 75,476 417,717 US Missouri Manitoba Emerson Road 74,871 297,587 US Missouri Saskatchewan North Portal Road 18,870 81,907

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Alberta 2017 Export Shipments of Honey – Volume, Transport Mode, and Value

Country of US State of Canadian Destination Destination Clearance Port of Exit Transport Quantity (KGM) Value $CA US Nevada Alberta Coutts Road 11,886 167,046 US N Hampshire Quebec Stanstead Road 19,160 72,509 US New Jersey Ontario Fort Erie Road 132,461 734,661 US New Jersey Saskatchewan North Portal Road 360 7,512 US New York Ontario Fort Erie Road 37,449 208,488 US New York Saskatchewan North Portal Road 18,579 105,965 US North Carolina Manitoba Emerson Road 56,203 229,843 US Ohio Manitoba Emerson Road 336,685 1,045,845 US Ohio Saskatchewan North Portal Road 16,161 59,699 US Oregon British Columbia Abbotsford-Huntington Road 19,160 102,295 US Oregon British Columbia Kingsgate Road 58,423 329,653 US Oregon British Columbia Pacific Highway Road 96,743 524,303 US Pennsylvania British Columbia Pacific Highway Road 7,961 44,639 US Pennsylvania Manitoba Emerson Road 225,906 933,363 US Pennsylvania Ontario Fort Erie Road 353,340 1,612,585 US Pennsylvania Ontario Lansdowne Road 18,870 105,623 US Pennsylvania Saskatchewan North Portal Road 56,580 246,768 US Texas Alberta Coutts Road 30,787 243,826 US Texas Saskatchewan North Portal Road 108,358 523,064 US Utah Alberta Coutts Road 93,790 354,225 US Virginia Alberta Coutts Road 18,880 53,315 US Virginia Manitoba Emerson Road 130,492 473,482 US Virginia Ontario Fort Erie Road 72,714 266,924 US Wisconsin Saskatchewan North Portal Road 10,256 46,577 Totals – Volume and Export Revenues 6,371,757 $27,150,428

Current Issues: Canadian honey producers want the federal government to increase and improve the testing of honey to ensure it is not being diluted with other sweeteners. They believe producers, particularly in Asia, are adulterating honey and so, can sell more cheaply. That, they say, has led to a drop-in price which is hurting legitimate producers. “Adulterated honey is a world-wide problem,” says Rod Scarlett, executive director of the Canadian Honey Council. “In fact, it’s been claimed that honey is the third largest food fraud item traded in the world behind olive oil and some spices. Source: Radio Canada International

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Section 2 - Closing Comments Agriculture is a diverse industry. From cropland to pastureland the variety of products grown and bred is impressive. Also, the diversity extends to the number of countries that import Canada’s agriculture products. Though Northwest Alberta only represents 3% of all of Canada’s farmland, over the decades the region has become internationally known for its superior quality.

This report is a summative baseline for identifying the agriculture commodities across the Northwest, the amount produced, linking this production to provincial exports and identifying, when possible, the mode of transport used to export. The sources used for the data presented within this report were numerous (noted through-out the report). From local grain elevator data, to provincial & federal databases, and the occasional access to global portals. Complementing our data collection was a keen eye on the ever-changing food-industry trends and global politics.

The principle crops and livestock grown and bred in the Northwest have weathered generations of tried and true global demand. New crops and new animals may occasionally be entertained across the decades, but wheat, canola, alfalfa, fescue, and cattle are dependable. They also afford the Northwest the opportunity to branch out to alternatives while keeping the Peace Country agriculture industry on Canada’s map.

Through-out the process of collecting the data for this report, sometimes a “jewel opportunity” would emerge. For example, looking at US trade data in reverse (i.e. what they import as opposed to what we export) it was identified that California imports more alfalfa seed from Australia than it does from Canada? Why? Does it have anything to do with a trade-agreement designed by politicians? Is it better than ours? Maybe it’s cheaper?

The US imports almost all of Alberta’s fescue at a value of $29 Million. Almost half of these imports go to Oregon. Why? Because Oregon has branded itself as the turf-grass capital of the world. Promotional videos from the region showcase the pristine turfs of Wimbledon, the US Golf Opens, majestic residential landscaping – all grown by the turf-grass seeds from Oregon! And sadly, the superior quality of our fescue (especially creeping red which the Peace Country is renowned for) from the Northwest gets lost amid someone else’s branding.

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The US paid $1.2 Billion to import fresh Alberta Beef. Ironically Texas represented $1.1 Million of this purchase. Even more amazing is California! The hipster, all vegetarian, environmentalist crazed of the “globe”; represented $440 Million! From an opportunity perspective – who are these beef loving diners and what restaurants are serving this high-premium delicacy? Is our region identified on these fine-dining menus?

Speaking of California, that State purchased $US 20,293,128 worth of field peas 2017. The current craze over meat-alternatives plant-based proteins has skyrocketed the demand for peas in California. Why? “Beyond Meat” is headquartered in California! Also known as the A&W burger. Launched across Canada at more than 900 stores, A&W is their biggest customer. This tech-food giant makes the pea- protein meat patties and ships them up to Canada.

Japan is a lucrative market. It appears that there are niche markets there that “only the best will do!” Top dollars for certified organic oats, fresh pork, and beef. And transportation costs beguiled! Japan is the most frequent user of Air Cargo to get its “highest quality imports” to its high-end end-users.

Overall though, almost 89% of everything Alberta export goes to the United States. They are our biggest buyer. The labyrinth of roads, airports, pipelines, and rail-ways that run from north-south has taken 100 years to build. On-again, off again trade agreements, tariffs and political agendas have either positively or negatively impacted our trade relationship with the United States in any given decade, but don’t forget:

For most of our exports proximity is a blessing. For some it is a curse. How proximity impacts the overall prosperity of Northwest Alberta, and our ability to get our commodities to global markets, is what we need to keep an eye-on.

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Funding for this research project was received from the Government of Alberta

under the Community and Regional Economic Support (CARES) program;

as such this report is available at no charge to the public.

Copies of this Report can be Downloaded From

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September 2019

This report is one of three available under this report series.

Northwest Alberta – Agriculture

Northwest Alberta – Oil & Gas

Northwest Alberta – Forestry

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September 26, 2019

The Honourable Jason Nixon, Minister of Environment and Parks, House Leader Office of the Minister 208 Legislature Building 10800 - 97 Avenue Edmonton, AB T5K 2B6

[email protected]

Dear Minister Nixon,

Re: Air Monitoring in the Peace River Area

The Peace River Area Monitoring Program (PRAMP) Committee provides continuous, long-term air monitoring in the Peace River area as part of the Oil Sands Monitoring Program. We understand from Alberta Environment and Parks (AEP) staff that a new, multi-year contract between AEP and PRAMP is in progress. We appreciate that a multi-year contract is being proposed as it will enable PRAMP to deliver efficient and cost-effective long-term environmental monitoring programs.

Unfortunately, during this period of transition to a new contract, PRAMP has not been reimbursed by AEP for its air monitoring program work since June 30, 2019.

We are requesting your approval of payment for the PRAMP long-term monitoring program to allow us to continue air monitoring and reporting services for the Peace River area and to pay our staff and service providers.

PRAMP provides comprehensive air monitoring to permit the identification and appropriate response to odour and emission related issues in the Peace River Area. We are also in the process of commissioning the first Air Quality Health Index (AQHI) station in the area that will provide valuable health-related information for residents. Air monitoring in the area started in 2010 and continues today as a collaborative effort among community, industry and government representatives. In 2016, the PRAMP Committee became a registered not-for-profit society and Alberta’s tenth Airshed. Funding for the monitoring is provided from the OSM program through a contract with AEP.

As a new not-for-profit society, PRAMP does not have reserve funds that would permit it to continue meeting its financial obligations during this period of transition to a new contract with AEP. We understand from AEP staff that the PRAMP budget and work plan for 2019-20 has been assessed and approved in the OSM review process, and that several steps remain within AEP before a contract will be provided to PRAMP.

In addition, in the PRAMP 2018-19 Financial Statements, the PRAMP Auditor has noted:

305-4625 Varsity Dr. NW Calgary, AB T3A 0Z9 Tel: 780.625.2900

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Subsequent to year end, the Society has not completed a contract for services for the final three quarters of the 2020 fiscal year-end. As a result, the Society is undergoing cash flow strain and without a contract, the Society may be required to liquidate assets and cease operations.

The current contract between AEP and PRAMP (Contract Number 19AEM814) extends to March 31, 2021. The financial commitment with the contract ended on June 30, 2019. An extension of the funding to December 31, 2019 (or another date recommended by AEP) for Contract 19AEM814 would allow PRAMP to continue its service delivery during this time of contract transition.

Alternatively, an advance of six months payment against the new contract would also be a practical solution for PRAMP. PRAMP will be pleased to work with AEP staff on whatever approach will enable PRAMP to access its approved OSM funds for the ongoing monitoring program.

Thank you for your assistance and we look forward to hearing from you.

Sincerely,

______Shelly Shannon Secretary/Treasurer

Doug Dallyn Garrett Tomlinson Anthony Traverse Community Co-Chair Government Co-Chair Industry Co-Chair Métis Nation Region 6 Baytex Energy

cc. Mr. Dan Williams, MLA for Peace River Mr. Pat Rehn, MLA for Lesser Slave Lake Mr. Todd Loewen, MLA for Central Peace-Notley

Ms Bev Yee, Deputy Minister, AEP Dr. Fred Wrona, Chief Scientist, AEP Dr. Monique Dube, Executive Director, AEP Mr. Bob Myrick, Director, Airshed Science, AEP

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October 15, 2019

The Honourable Jason Nixon, Minister of Environment and Parks Office of the Minister 208 Legislature Building 10800 - 97 Avenue Edmonton, AB T5K 2B6

Dear Minister Nixon,

Re: Environmental Monitoring and Clean Air for Albertans

Change is in the air! We understand that Alberta Environment and Parks (AEP) is currently reorganizing and we look forward to continuing to work with AEP under your leadership. As such, we are reaching out to you as follow-up to a previous letter sent on May 16, 2019.

Alberta’s Airshed organizations continue to be key strategic and place-based monitoring partners for AEP, implementing reliable and independent environmental monitoring for the past 20 years. Airsheds also undertake significant on-the-ground community outreach and air literacy projects in communities across the province.

Multi-stakeholder oversight ensures the credibility of air monitoring across the province and enables Airsheds to operate economically with resources provided by multiple sectors. As such, we rely on timely provision of funding, including AEP grant funding, so that we can plan and implement our programs each year. Airshed grant applications for 2019-20 were submitted in May 2019 and we look forward to a response from AEP on the grants as soon as possible so that Airsheds can avoid curtailing programs.

Airshed organizations are regional networks that form the backbone of air monitoring in the province. Collectively, the Airsheds operate 78 continuous air quality monitoring stations along with 198 passive air and microsite monitors, all in compliance with provincial and federal standards. This extensive network is complemented by seven (7) additional AEP owned and operated continuous air quality monitoring stations. Airsheds have representation from Government of Alberta (Health and Environment and Parks), Government of Canada (Environment and Climate Change Canada), First Nations and Métis Nations, municipalities, industry, environmental groups, and communities. Consensus-based decision-making allows all our stakeholders to have an integral impact on actions that bring local solutions to local concerns.

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Alberta’s 10 Airshed organizations look forward to continued collaboration with AEP in its stewardship and oversight role. We value the support that AEP continues to provide to Airsheds, both in-kind and financially. We look forward to working with you, and we will follow-up with your office to schedule a convenient time to meet to discuss the continued partnership between Airsheds and AEP.

Sincerely,

Nadine Blaney Karla Reesor Co-Chair Co-Chair Alberta Airsheds Council Alberta Airsheds Council

CC Bev Yee, Deputy Minister, Alberta Environment and Parks Dr. Fred Wrona, Chief Scientist, Alberta Environment and Parks Brent Korobanik (Lehigh Cement), Alberta Capital Airshed Board Chair David Lawlor (Community Member), Calgary Region Airshed Zone Board Chair Allan Wesley (Community Member) Fort Air Partnership Board Chair Andrea Woods (Community Member), Lakeland Industry and Community Association Board Chair Russ Golonowski (CF Industries), Palliser Airshed Society Board Chair Aaron Rognvaldson (Husky Energy), Parkland Airshed Management Zone Board Chair Bob Marshall (County of Grande Prairie), Peace Airshed Zone Association Board Chair Anthony Traverse (Baytex Energy), Peace River Air Monitoring Program Board Co-Chair Doug Dallyn (Community Member), Peace River Air Monitoring Program Board Co-Chair Garrett Tomlinson (Métis Nation Region 6), Peace River Air Monitoring Program Board Co-Chair Melissa Nelson (Capital Power), West Central Airshed Society Board Chair Cliff Dimm (Syncrude), Wood Buffalo Environmental Association Board Chair

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Why Airsheds Matter Key Facts

Air Quality Monitoring  Alberta’s 10 Airsheds operate an extensive, integrated ambient air monitoring network with 84 continuous monitoring stations. This network provides raw and validated data 24 hours a day, seven days a week and is made widely available to industry, governments, Indigenous communities, academia and the public.  Multi-stakeholder oversight of monitoring, data and analysis through Airshed organizations is critical to ensuring a neutral, science-based approach to understanding air quality.  Governed by a Board of Directors composed of public, Indigenous communities, industry and government representatives and guided by highly experienced Technical Working Groups, each Airshed rigorously meets or exceeds government standards for ambient air quality monitoring.  Field monitoring provides real-time data for validation and comparison to predictive modelling for air quality in Alberta. The data is shared to inform decision makers and policy reviewers to evaluate effectiveness of regulatory policies and management frameworks.

Air Quality and Health  Air quality has major impacts on human health and the environment. Airsheds share information to help people develop an understanding of air quality and how it impacts human health, and to encourage them to engage in clean air practices.  Airsheds are crucial to the AQHI (Air Quality Health Index). Data collected by Airsheds contributes to the AQHI which is reported in over 30 communities in Alberta. We strive for increased monitoring to support robust AQHI reporting, promote AQHI to communities, schools and the media, and respond to public inquiries.  The World Health Organization estimates that air pollution is responsible for an estimated 4.2 million deaths annually. Health Canada estimates there are 14,000 to 15,000 deaths in Canada each year due to air pollution.

Air Quality Education and Outreach  Airsheds participate in local community events and offer several education and engagement programs throughout Alberta, often in collaboration with other organizations.  Airsheds organize public events concerning air quality such as the Clean Air Forum, odour management workshops, health workshops and activities related to the annual Clean Air Day.

Air Quality and Sustainable Development  Air quality is an essential component of sustainable development. Information about local and regional air quality from sources that are seen as credible in the eyes of the public is critical to sustainable development policies and programs.  Multi-stakeholder Airsheds provide comprehensive and cumulative ambient air quality data that is/can be used to evaluate impacts of sectors and stakeholders for proper management of developing areas  Cleaner air can reduce damage to crops, forests, surface waters, and infrastructure such as buildings and bridges, and can also help address climate change impacts. 3

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Alberta Airsheds Map