Simply stated, Defence Construction Canada was formed as Defence Construction (1951) Limited, just as the name implied, in 1951 under the Defence Production Act. Our mandate is to deliver infrastructure and environmental requirements for the defence of Canada. That encompasses primarily our client partners, the Department of National Defence, with the Canadian Armed Forces, but it also does include other aspects of defence interests for Canada, everything from the Canadian Forces Housing Agency across to, today, the Communications Security Establishment and other similar types of government entities.
Following the Second World War, when Canada's defence capabilities had been reduced because the war was over, but then re-emerging during the Cold War period, the government had a few priorities that it wanted to address quickly and efficiently. One was the modernization and upgrading of Canadian military bases, and the other was to add capacity to prepare for some of the Cold War threats that were perceived. An example would be the decision in the early 1950s to construct the DEW Line in the north. Government looked to existing resources to come up with capabilities that already existed, to the extent possible, and that could be grown; and to consolidate a focused organization that could deliver these defence infrastructure requirements, by dealing with both the procurement, and then the management and delivery, of those requirements as efficiently and as effectively as possible.
DCC was created under the authority of the Defence Production Act, and today is responsible to Parliament through the Minister of Public Services and Procurement. That resulted in the independence of the delivery organization from National Defence itself, which had the need for the infrastructure. That has continued right through to today.
DCC is very much focused in 2016 and beyond on the same things that were stated at the time of its creation, and that was effective, efficient delivery of infrastructure on time, on budget, on specification. Today we use terms like “value for money”, and other modern terms to talk about this, but they essentially boil down to the same thing. That's been DCC'S focus.
I would add, Chair, that defence infrastructure, which is the largest segment of the federal government's real property portfolio, at more than $20 billion in realty replacement costs, has an ongoing requirement for maintenance, repair, and upgrade. Typically, they are very specialized assets. It can be everything from buildings, which would include hospitals, schools, accommodations, barracks, to runways and the underground infrastructure of the bases and wings themselves, which operate very much like small cities. It includes water treatment plants, sewage treatment facilities, communications lines, and many other aspects like that. These special purpose assets take a very particular knowledge and skill set to deliver efficiently and effectively, and often there are high security requirements, of course, around them. It includes work in the north—I mentioned the DEW Line— and so involves harsh environments in remote conditions. Even if Canada decided to deliver infrastructure in any of its international defence operations—Afghanistan was an example—DCC was there with staff for the whole eight years of the operation. Over 70 staff in total all volunteered to serve six-month terms there, delivering the infrastructure requirements that Canada needed to support defence operations.
It's been an interesting, but very much a consistent, approach for the entire 65 years of our existence. I think that states very well what we do.
Thank you for inviting Canada Lands Company Limited to appear today. In addition to the opportunity to provide opening remarks, we welcome any questions you or members of the committee may have.
I would also like to invite all the committee members to visit our websites. My team and I will be available after the meeting if you need additional information.
To give you more details and perspective, I have with me today Robert Howald, Executive Vice-President, Real Estate, Canada Lands Company. Mr. Howald is also in charge of the Downsview Park, in Toronto. Also joining me is Julie Payette, Vice-President of the Canada Lands Company and CEO of the Montreal Science Centre, as well as Basil Cavis, Vice-President, Real Estate, Quebec and Old Port of Montreal.
Canada Lands Company or CLCL was incorporated in 1956 as Public Works Lands Company Limited. After initial activity, it became dormant until reactivated by the government in 1995. Today we operate with the mandate defined at the time.
Unlike private sector businesses, Canada Lands Company has a mandate to take into account the government's strategic considerations. Those include the points of view of the affected communities and of other levels of government, as well as other heritage, environmental and social issues.
Structurally, Canada Lands Company Limited comprises the parent organization, referred to as CLCL, and three subsidiary corporations: Canada Lands Company, the real estate arm; Parc Downsview Park; and the Old Port of Montreal, which includes the Montreal Science Centre.
Each is headed by the same chairperson, directors, and president, and chief executive officer, all appointed by the Governor in Council.
We have provided the members of the committee with our corporate structure diagram and a concise chronology of the company's history as an accompaniment to our presentation.
As the real estate arm, Canada Lands Company manages the company's real estate interests as well as Canada's National Tower in Toronto. I will refer to this subsidiary simply as Canada Lands or CLC.
Canada Lands Company helps the government manage its surplus real property. Once properties are no longer useful to the government, the company buys them at market value.
Canada Lands' role in the disposal of surplus properties is defined by the Treasury Board's directive on the sale or transfer of surplus real property. What makes us unique is that in addition to profitability, our projects provide auxiliary benefits to Canadians and the communities in which we work.
We act as the master developer of properties. We engage, consult, and obtain development plan approvals. We sell to the private sector, which builds and sells the final product.
The next subsidiary of CLC is Parc Downsview Park Incorporated, which owns and manages the operations of Downsview Park and holds the Downsview lands in Toronto.
The last subsidiary is the Old Port of Montreal Corporation. It owns that property and manages the operation and investments of the Old Port of Montreal and the Montreal Science Centre.
From coast to coast Canada Lands Company creates benefits for its shareholder above and beyond financial contributions.
Allow me to describe some of the aspects of what we consider to be the value proposition for Canadians.
We handle complex properties. Acting as the government's expert in real estate disposal, we enable surplus, underutilized properties to be reintegrated into communities in productive ways. We bring innovative solutions and enable projects to move forward taking into account community, environmental, first nations, and private sector interests as well as the market. We engage and consult extensively.
The company's fulsome engagement process is our hallmark. Canada Lands is fully dedicated to understanding and collaborating with the community to enhance and integrate our properties. We see the benefit of our consultations, not only in the quality of our master plans, but also in the approvals we obtain. Recently, both Ottawa and Calgary approved our development plans without objections.
We fully comply with all municipal and provincial planning requirements. We operate within the context required of any developer. In that regard, we accommodate the planning preferences of municipalities.
We enable the creation of affordable housing. Canada Lands routinely explores the integration of affordable housing as part of our development plans. We participate in federal programs such as the surplus federal real property housing initiative, and we work with municipalities to ensure their objectives for affordable housing are met. To date, the CLC has enabled the implementation of 2,180 affordable housing units.
We incorporate parks, commemoration, and recreation components as key elements of our projects. On average, Canada Lands contributes 28% of its landholdings to green space uses for both active and passive recreation. We commemorate heritage land uses, investing over $11 million on 33 legacy initiatives, such as monuments to the armed forces, interpretative trails, and first nations commemoration.
We build business partnerships with first nations. We have established agreements or joint ventures with first nations at six sites in British Columbia and Ontario and are in discussion to create development agreements at three more.
We hold and manage specific properties to the benefit of Canadians. We manage the operations and invest in the CN Tower to ensure it meets Canadians' expectations worthy of its iconic stature. We have direct responsibility for the Old Port of Montreal, the Montréal Science Centre, and Downsview Park, and we bring due diligence, efficiency gains, and timely investments to these attractions of regional and national significance. We welcome more than eight million visitors a year to these sites.
We reduce the federal government's costs and provide a financial benefit to Canadians. We assist federal custodians to reduce their operational carrying costs and liabilities by removing surplus properties from their inventory. Our projects then become regional economic engines for trades, businesses, and professionals, building new communities and infrastructure.
CLCL and its subsidiaries are self-financing. We receive no appropriations. We pay applicable taxes at all levels of government and ultimately return all net revenue to the fiscal framework. Our 2015 to 2020 corporate plan identified financial returns to Canada that will exceed $470 million over five years, including cash dividends of $110 million.
Looking back, the company's financial contributions are significant. Since 1995, Canada Lands has contributed a total of $750 million to the government in the form of dividends, notes repayment, and income taxes paid.
We are keen to lend our knowledge and evolve in ways that increasingly benefit Canada, and I hope that you and others share with us the excitement about what the future holds.
Thank you for the opportunity to provide these remarks. We would be pleased to respond to your questions.
Thank you very much, Madam Chair.
I want to welcome all of you this afternoon.
I will start with some questions for the Canada Lands Company representatives.
I think that this crown corporation is one of the well-kept secrets of the federal crown. I had the opportunity to work with the organization's members, including Mr. Cavis, and I must say that the experience was excellent. We engaged in discussions, which I hope to be able to continue, especially when it comes to the project involving the Chapais Farm, an Agriculture Canada site of which the department wants to divest itself.
The community is very interested in enhancing the site, which is exceptional. In Lévis, we say that it could become for us the equivalent of what the Plains of Abraham are for Quebec City. The site also has a great deal of potential for the development of affordable housing. I want to take this opportunity to mention that I plan to meet with the mayor over the next few days to reactivate the file after the election break we went through.
CLC is really a great organization. Mr. McBain, can you confirm the number of projects the company currently has underway? I think you brought that up. Is it indeed 33 projects?
Am I correct when I say there are 33 projects you are currently involved in?
Good afternoon, everyone.
Thank you for the question, Mr. Blaney. It is highly relevant to my work. I joined the Canada Lands Company because they needed someone to manage the Montreal Science Centre and extend its reach.
I'll speak in English. Why not?
Where is the site of knowledge? Here in Canada we are so fortunate to have liberty and freedom to go to school and to advance and to progress. That cannot be done without science and technology, as we all know. Innovation comes from everywhere. The spark has to be given to young kids to decide to go and study science and technology, just like the spark to play hockey, or the spark to play the violin in an orchestra, or to go into public service, or become a member of Parliament as well. Every single person counts in a society. Sometimes, however, we forget that science and technology is for everyone and there is a basic science culture to be had. In order to grow, our society has to continue that. Throughout Canada we have more than 45 centres, some are municipal, some are provincial, a few are federal, that do science and technology
as well as science outreach
to instill that knowledge into people. We have six major science centres in Canada, one each in Vancouver, Edmonton, Calgary, Toronto, Ottawa—with which you're most familiar with, I'm sure—and in Montreal. I'm very privileged to be the head of the one in Montreal.