Surrey, Langley in talks for Kinder Morgan pipeline benefits

Deal making with Trans Mountain not over despite this week's B.C. government approval

To compensate for pipeline construction disruption, some but not all municipalities along the route will get significant benefits payouts from Kinder Morgan.

To compensate for pipeline construction disruption, some but not all municipalities along the route will get significant benefits payouts from Kinder Morgan.

Some critics called it bribery to get local politicians to back the pipeline.

Or hush money to at least not oppose Kinder Morgan while its Trans Mountain expansion project was in hearings before the National Energy Board.

A total of 18 community benefit agreements worth $8.5 million were reached by the pipeline firm in B.C. and Alberta along 95 per cent of the corridor over the past three years.

And despite the project approvals now in place from both the federal and provincial governments, the door has not been slammed shut on further local deals.

Trans Mountain officials say they are actively in talks with local governments and educational institutions in areas where no deals are yet in place to provide community benefit agreements to compensate for construction impacts.

RELATED: Province green lights Kinder Morgan pipeline, reaches benefits deal

Surrey, which opposed the project as an intervenor before the NEB, is now in talks with Trans Mountain to accept benefit money.

“We’re waiting to hear back from staff on how that’s going,” Surrey Coun. Bruce Hayne said.

“Certainly, if there’s benefits to the community to be had if the pipeline is going to go ahead – which at this point it looks like it will – then it will be in our best interests to have that discussion and look at what those benefits can be.”

Langley Township is also actively negotiating for benefits, confirmed Mayor Jack Froese.

He said the township is concerned about higher future costs of building and maintaining infrastructure like roads and water lines due to the proximity to the pipeline and the additional steps that must be taken as a result.

The municipality estimated its costs could add up to nearly $13 million over the next 50 years. Other cities are concerned about similar cost increases.

Froese said Langley Township’s priority has been to accurately assess those impacts before deciding what sort of community amenity to ask Trans Mountain to support.

Burnaby, with a council fiercely opposed to the pipeline and the increased risks it believes the terminal and expanded tank farm would pose to residents, is one municipality where a deal may never be struck, project officials say.

“I would characterize discussions with Langley and Surrey as having progressed further than with Burnaby,” said Trans Mountain spokesperson Ali Hounsell. “We’ve got the vast majority of them on board already. And it may be that the remaining ones will not get there.”

In holdout cities like Burnaby, Trans Mountain officials say, benefits deals could instead be made to provide money to local streamkeepers or other environmental improvement groups or educational institutions.

INTERACTIVE MAP: DEALS DONE, UNDER NEGOTIATION OR REJECTED

Next door to Burnaby, Coquitlam council was the first Metro Vancouver municipality to sign on to a benefits deal, agreeing to accept $1 million to upgrade Mackin Park.

Hounsell said the money doesn’t flow until Kinder Morgan Canada makes a final decision to approve and build the pipeline, likely in the first half of this year. A construction start is anticipated for September, but the project still faces numerous legal challenges.

Community benefit deals can fund anything from local trail or park improvements and other infrastructure to education and training programs. They’re intended to leave a legacy as compensation for construction disruption and costs.

Signing on to an agreement did not bind a local government to support the project, Hounsell said.

“We were really flexible,” she said. “Some were willing to give really overt support, others were a little bit more measured in their language and that was fine with us.

“It tends to signify that we have a relationship, there’s an ongoing dialogue, and it doesn’t mean you can’t ask us tough questions or hold our feet to the fire. It was more about leaving a legacy for the communities.”

In addition to benefits agreements, the project work is expected to bring construction and workforce spending in affected communities, as well as higher ongoing property tax payments.

Within Metro Vancouver, construction spending is estimated at $1.15 billion, and spending by local and non-local workers during construction is pegged at $159 million.

Controversial cash

The choice of accepting benefits cash was controversial in cities like Chilliwack, where there’s been significant opposition over concern about local impacts and risks.

It came to a head in May of 2015 when an offer of $800,000 for a pedestrian bridge over the Vedder River was put to council.

The proposed deal was denounced as a “bribe” by critics, and at best “leverage” by hesitant elected officials, and Chilliwack council rejected the cash.

Then, a year and a half later, in August 2016, there was a change of heart.

With the NEB process complete and a recommendation to approve in place, councillors decided the money was too hard to resist and Chilliwack became the 10th community in the province to sign an agreement with Kinder Morgan.

A month later Fraser Valley Regional District electoral area D signed its own deal for $75,000 to go to community park development in Popkum and upgrades to the Mt. Cheam trailhead parking lot.

Abbotsford, the B.C. city with the most territory crossed by the pipeline, signed a benefits agreement last February.

Council voted 6-1 in favour of a deal that would see Kinder Morgan pay $1.3 million to replace a clubhouse at the city-owned Ledgeview Golf Club, underneath which the pipeline runs.

Abbotsford Mayor Henry Braun praised Kinder Morgan as a “good corporate citizen.” But Coun. Patricia Ross, the lone opponent on council, worried the company hadn’t adequately addressed concerns of a future spill and increased air pollution from tanker traffic.

The pipeline runs for about 30 kilometres through Abbotsford, and the city is also host to a pump station and a tank farm, which would be expanded. There have also been two spills on Sumas Mountain, in 2005 and 2012, and both times Kinder Morgan was criticized for its response.

The deal took a left turn a couple months later, when the Ledgeview clubhouse to be replaced spectacularly burned to the ground. The clubhouse was insured, allowing the city to look at other potential destinations for the funds. At this point, the city is considering putting the money from the benefits agreement towards an expanded recreation and cultural centre.

Meanwhile, a group of Fraser Valley farmers are campaigning for regular royalty payments from Kinder Morgan. The company has offered lump sum payments, but the farmers say they should receive compensation for the ongoing hassle of dealing with the pipeline’s presence on their land and obstacles it presents to regular agricultural practices.

Kwantlen flip-flop

An even more contentious benefits decision was that of Kwantlen Polytechnic University.

KPU reached a deal with Kinder Morgan in June of 2015 for $300,000 in benefits over 20 years.

The money for Kwantlen was to consist mainly of scholarships and bursaries for trades and technology students, and to help fund an environmental protection technology lab, with potential naming rights flowing to the pipeline company.

But the deal instantly came under fire from students, faculty, environmentalists and the First Nation after which the university is named.

KPU withdrew from the agreement three months later, citing the importance of its relationship with the Kwantlen First Nation.

A KPU spokesperson said Thursday there are no plans to try to negotiate a new benefits agreement.

Other educational institutions that have deals in place are Thompson Rivers University ($500,000), Camosun College ($400,000) and the Coquitlam Foundation ($300,000).

A separate 51 “mutual benefit agreements” with 41 B.C. First Nations and 10 in Alberta are worth $400 million.

Trans Mountain officials say those First Nation deals cover all B.C. reserves the pipeline crosses and the majority of First Nations where the pipeline or tanker route crosses their traditional territory.

First Nation benefit agreements typically cover environmental protection, cultural and archaeological monitoring, and direct benefits through jobs, training, business opportunities and support to upgrade community infrastructure.

– with files from Tyler Olsen, Paul Henderson, Ashley Wadhwani

Pipeline route along the Coquihalla Highway.

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