Archived: Departmental Performance Report supplemental tables 2013-14, Environment Canada, chapter 7

Up-Front Multi-Year Funding

• Clayoquot Biosphere Trust
• Green Municipal Fund
• Nature Conservancy of Canada
• Sustainable Development Technology Canada

Clayoquot Biosphere Trust

Start date: February 2000

End date: In perpetuity

Total funding: $12 million

Description: Creation of an endowment fund for the Clayoquot Biosphere Trust (CBT), the   cornerstone of the Clayoquot Sound UNESCO Biosphere Reserve Region Community. The CBT will use the income from the endowment fund to support local research, education and training in the Biosphere Reserve Region.

Strategic outcome: Canada's natural environment is conserved and restored for present and future generations.

Summary of results achieved by the recipient:

During 2013-14, the CBT achieved the following objectives and deliverables:

• Delivered a field trip program to all schools in the region to ensure students have an opportunity to learn firsthand about the Biosphere Reserve;
• Delivered a Sustainability Studies 11/12 course, which was developed by CBT and accredited by School District 70, at Ucluelet Secondary School;
• Led a board retreat to define the vision and next steps towards establishing a permanent biosphere centre;
• Delivered a $50,000 call-for-projects focused on regional project priorities;
• Continued community health monitoring in support of the CBT's Vital Signs program; and
• Provided scholarship support to seven students from throughout the region.

Comments on variances: Not applicable.

Significant evaluation findings by the recipient during the reporting year and future plan: Not applicable.

Significant audit findings by the recipient during the reporting year and future plan: Not applicable.

Link to recipient’s site.

Green Municipal Fund

Start date: February 2000

End date: In perpetuity

Total funding: $550 million shared between Environment Canada and Natural Resources Canada. Environment Canada’s share is one half, specifically $275 million.

Description: The Green Municipal Fund (GMF) is a revolving fund administered by the Federation of Canadian Municipalities (FCM). The GMF supports grants, loans and loan guarantees to encourage investment in environmental municipal projects. The Government of Canada (GoC) endowed the FCM with a total of $550 million for this initiative through a series of budget decisions from 2000 to 2005.

The GMF was established to enhance Canadians’ quality of life by improving air, water and soil quality and protecting the climate. Eligible projects may fall into one or more of the following categories: brownfields, energy, transportation, waste, water in the form of sustainable neighbourhood action plans, community brownfield action plans, greenhouse gas (GHG) reduction plans, feasibility studies, field tests and capital projects. At least 30% of the value of the Fund Assets^Footnote 1 is dedicated exclusively to supporting brownfield remediation and redevelopment.

The amount of GMF financing available for municipal projects is directly related to the environmental benefits or innovativeness of the project, while taking into account economic and social considerations. Grants are available to cover up to 50% of eligible costs for plans, studies and field tests. A loan is available for up to 80% of the total; for capital projects where environmental, economic and social benefits are deemed exceptional, the loan is typically combined with a grant for up to 20% of the loan to cover eligible costs. The grant is often for 10% of the loan amount.

As stipulated in the GMF Funding Agreement between the FCM and the GoC, the FCM has created two advisory bodies: the GMF Council and the Peer Review Committee. The GMF Council’s role is to assist the FCM Board of Directors, the decision-making body for the GMF, in approving projects proposed by municipalities. The 15-member GMF Council includes five federal members: two from Environment Canada, two from Natural Resources Cananda and one from Infrastructure Canada. All federal members are appointed by the FCM Board of Directors based on recommendations from the Minister of the Environment or the Minister of Natural Resources.

Environnement Canada peer reviewers provide the GMF and federal Council members with expert environmental science and technology advice, and they evaluate funding proposals.

Strategic outcome: Threats to Canadians and their environment from pollution are minimized.

Summary of results achieved by the recipient:

The GMF Annual Report 2013-2014 is expected to be released in August 2014 on the FCM website^Footnote 2. According to the GMF Annual Report 2012-13, the FCM has, since the inception of the GMF in 2000, committed to disbursing $668 million to support 987 green initiatives across Canada. Of the 987 initiatives funded to date, 171 have been capital projects, which are expected to generate over $3.3 billion in economic activity in 123 communities. The GMF-funded capital projects completed to date have reduced GHG emissions by about 352,000 tonnes per year, diverted over 143,000 tonnes of waste per year from landfill, and treated over 137 million cubic metres of water annually.

In the absence of the GMF Annual Report 2013-2014, the GMF’s Annual Statement of Plans and Objectives 2013-2014 provides the expected results for fiscal year 2013-14, including the following:

Grants for sustainable community plans, feasibility studies and field tests

As of March 31, 2009, the FCM must aim to commit $6 to $8 million per year in grants for sustainable community plans, feasibility studies and field tests. In fulfillment of this requirement, the FCM was aiming to approve $6 million for plans, feasibility studies and field tests in 2013-14.

Loans and grants for capital projects

The FCM offers a combination of grants and low-interest loans in support of capital projects. Grants are only offered in combination with loans. Under the Funding Agreement, the FCM must aim to commit $50 to $70 million per year in loans. As of March 31, 2009, the FCM must aim to commit $5 to $6 million per year in grants to capital projects. In fulfillment of this requirement, FCM was aiming to approve $65 million in loans and $5 million in grants for capital projects in the energy, transportation, waste and/or water sectors.

In the 2005 funding agreement, the FCM committed to lending or guaranteeing loans totalling $150 million for brownfield projects by March 31, 2012, and at least 30% of the value of the Fund Assets^Footnote 3thereafter. These requirements have been difficult to fulfill, but FCM has investigated and developed an action plan. The FCM was aiming to approve a total of $20 million for brownfield capital projects in 2013-14. Under the provisions of the Funding Agreement, brownfield projects are not eligible for grants.

Performance measures

To measure and demonstrate the qualitative, quantitative, and short- and long-term success of the GMF, the planned activities outlined in the Annual Statement of Plans and Objectives 2013-2014 included the following:

• Capacity building: Encourage Canadian municipalities to use the knowledge, networks and tools provided by the GMF to develop their internal capacity to achieve their sustainability goals.
• Leveraging partnerships and brokering: Extend the reach of GMF funding and knowledge to achieve greater overall impact.
• Performance measurement: A performance measurement system is in place to effectively and efficiently manage data.
• Risk management: A governance structure and risk management framework is used to anticipate and manage risk, and to ensure excellent Fund stewardship.    
• Marketing and communications: A GMF marketing and communication strategy leverages the fund with target audiences and aligns with current and evolving requirements.
• Integrated projects: An integrated project sector is appropriately incorporated in a new GMF-centered funding offer.

Comments on variances: All funds to the GMF were paid out in prior years.

Significant evaluation findings by the recipient during the reporting year and future plan: Section 11.05 of the Funding Agreement stipulates that the FCM agrees to obtain, make public and forward to each Minister, for tabling in Parliament, an independent review using recognized evaluation standards on the following timelines: an initial review within six months following March 31, 2009; and subsequent reviews every five years from the date of the first review. The next independent review will take place starting in 2014.

Significant audit findings by the recipient during the reporting year and future plan: Section 11.07 of the Funding Agreement stipulates that the FCM agrees to have carried out an independent performance (value-for-money) audit to ensure the economy, efficiency and effectiveness with which funds have been used. An initial review must be carried out within six months following March 31, 2009, and subsequent reviews every five years from the date of the first review. The next independent performance audit will take place starting in 2014.

Link to recipient’s site.

Nature Conservancy of Canada

Start date: March 2007

End date: In perpetuity (until the total funding is expended)

Total funding: $245 million ($225 million under the 2007 Budget Implementation Act and $20 million under the Economic Action Plan 2013 Act)

Description: The Nature Conservancy of Canada (NCC) works to ensure the long-term protection of biodiversity by working with private landowners and land managers to secure ecologically significant lands that have been identified as priorities for conservation action. To that effect, the Conservancy acquires and preserves land through any of 4 methods: land purchase, land donations, conservation easements or relinquishment of rights. It also ensures support for the ongoing management and restoration of the habitat it secures. The goal of the program is to secure 218,000 ha of private land for conservation and implement stewardship actions on an estimated 45,000 ha of land secured under the Program.

Strategic outcome: Canada's natural environment is conserved and restored for present and future generations.

Summary of results achieved by the recipient:As of the end of March 2014, the Conservancy had drawn $236.2 million of the $245 million under the federal allocation of the available Natural Areas Conservation Program (NACP) funding. As of June 2013, the end of the sixth year of the NACP, the Conservancy and its partners had raised more than $224 million in matching funds and pledges from private and other public sources, and had received donations of conservation lands and easements valued at more than $169 million from private landowners. This comes to a total of over $393 million, which surpasses the Conservancy’s goal. The Conservancy and its partners have secured more than 369,000 ha of land, through more than 1,090 land transactions. These lands are found in every province and provide habitat for at least 164 species at risk.

Comments on variances:

The original $225 million of this conditional grant was fully approved in fiscal year 2006-07, and the additional $20 million was fully approved in fiscal year 2013-14. Payments made under the grant are based on the Conservancy's fiscal year, which commences on July 1. As per fiscal year basis (starting April 1^st), instalments under the grant were $70.2 million in 2007-08; $46.1 million in 2008-09; $29.3 million in 2009-10; $21.7 million in 2010-11; $33.7 million in 2011-12; $24.0 million in 2012-13; and $11.2 million in 2013-14.

Significant evaluation findings by the recipient during the reporting year and future plan:

The sixth annual progress report spanning April 1, 2007, to June 30, 2013, was received from the Conservancy on December 16, 2013, and was deemed to be satisfactory.

The findings from the 2012 program evaluation were addressed in the 2013 amended funding agreement.

In 2014-2015, a broader departmental evaluation on habitat conservation programs will be undertaken. This evaluation will include the NACP.

Significant audit findings by the recipient during the reporting year and future plan:

A financial audit, dated June 30, 2013, was conducted by Ernst & Young to inform the sixth annual progress report on the program, which spanned July 1, 2012, to June 30, 2013. The auditor's report indicated that "...the financial statements present fairly, in all material respects, the financial position of the Fund as at June 30, 2013 and the revenue and expenses in the NCC and Other Qualified Organizations (except Ducks Unlimited Canada, which submitted a separate audit) columns in the statement of operations and changes in unrestricted net assets for the period from March 30, 2007 to June 30, 2013 and for the year ended June 30, 2013...”. The Conservancy is expecting to expend the remaining funds from the full $245 million federal allocation by March 31, 2015.

Link to recipient’s site.

Sustainable Development Technology Canada

Start date: March 2001 for the Sustainable Development Technology Fund (SD Tech Fund™) and April 2007 for the Next Generation Biofuels Fund (NextGen Biofuels Fund™ or NGBF)

End date: December 2017 for the SD Tech Fund™ and September 2027 for the NGBF

Total funding: $865 million ($590 million for the SD Tech Fund™ and $275 million for the NGBF) from Environment Canada and Natural Resources Canada. Environment Canada provides one half of $865 million, specifically $432.5 million.

Demand for NGBF funding has been lower than expected largely due to a market in which next-generation biofuels are not economically competitive. As a result, of the initial $500M allocation, the Government returned a total of $225M in unspent appropriated funds from 2012-13 and 2013-14, with EC reporting its share as $62.5M unspent in 2012-13, and $50M unspent in 2013-14 (see table below).

Description: Sustainable Development Technology Canada (SDTC) is a not-for-profit foundation created by the Government of Canada to finance and support development and demonstration of clean technologies that provide solutions to issues related to climate change, clean air, water and soil quality, delivering economic, environmental and health benefits to Canadians. As sponsoring departments for the federal government, Environment Canada and Natural Resources Canada provide federal oversight of SDTC to ensure that it complies with funding agreements and founding legislation. The Minister of Natural Resources is responsible for reporting to Parliament on SDTC.

SDTC manages two separate funds:

• The SD Tech Fund™ provides financial support to projects that have the potential to advance sustainable development, including technologies to address climate change, clean air, and water and soil quality issues; and
• The NGBF provides financial support towards the establishment of facilities producing next generation renewable fuels at large demonstration scale.

SDTC-funded projects are active in all major Canadian economic sectors, including energy exploration and production, power generation, energy utilization, transportation, agriculture, forestry and wood products, and waste management.

Strategic outcome: Threats to Canadians and their environment from pollution are minimized.

Summary of results achieved by the recipient:

SD Tech Fund™

The Government provided SDTC with a series of grants for the SD Tech Fund between 2001 and 2006. SDTC has been disbursing those funds to eligible recipients on an as needed basis and, in 2013,^Footnote 4disbursed $59 million to eligible recipients.

As reported in SDTC’s 2013 Annual Report, 65 completed projects reported annual actual GHG emissions reductions of approximately 2.8 megatonnes in 2013. The total annual GHG emissions reduction in 2015 attributable to projects funded by SDTC is projected to be between 6 to 12 megatonnes.

NGBF

The Government provided SDTC with a series of grants for the NGBF between 2007-2010. SDTC has been disbursing those funds to eligible recipients on an as-needed basis, and in 2013 disbursed $194,000 to eligible recipients. Demand for funding has been lower than expected largely due to a market in which next generation biofuels are not economically competitive.

Comments on variances: The $50 million variance represents the amount in unspent appropriations returned to the Consolidated Revenue Fund by Environment Canada.

Significant evaluation findings by the recipient during the reporting year and future plan: According to the terms of the SD Tech Fund™ funding agreement, the next evaluation by the recipient is due in 2015.

According to the terms of the NGBF funding agreement, two interim evaluations (November 30, 2017; and November 30, 2022) remain to be performed by an independent third party selected by the Foundation. A final evaluation is due by September 30, 2027. Despite slow growth of the sector, the first interim evaluation (November 30, 2012) concluded that SDTC has established a rigorous due-diligence process and is engaging with existing and potential industry clients.

Significant audit findings by the recipient during the reporting year and future plan: A standard financial audit was completed as required for the financial data in the 2013 SDTC Annual Report. A value-for-money, or performance audit, for the SD Tech Fund™ was completed by the Federal Government in fiscal year 2009-10, and the final report was issued in July 2011. The report was generally positive, but identified issues that were subsequently resolved through the Funding Agreement Four approved by the Treasury Board Secretariat on June 7, 2012.

Link to recipient’s site.