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Al-Pac Case Study
- Part III
Daniel
Farr, Biota Research
Steve Kennett, Canadian Institute of Resources Law
Monique M. Ross, Canadian Institute of Resources Law
Brad Stelfox, Forem Technologies
Marian Weber, Alberta Research Council
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This case study has been commissioned as background research
for the NRTEE’s Conserving Canada’s Natural
Capital: The Boreal Forest program.
The views expressed in the case study are those of the authors,
and do not necessarily represent those of the National Round
Table, its members, or the members of the program’s
Task Force.
July 2004
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Part
3: Executive Summary
This document is
Part 3 of a three-part case study report examining conservation
issues in the Alberta-Pacific (Al-Pac) Forest Management Area
(FMA). In this part, we provide a summary of key fiscal barriers
and opportunities that could be pursued to preserve natural capital
on the Al-Pac FMA. The case study was commissioned by the National
Round Table on the Environment and the Economy (NRTEE) as part
of its Conserving Canada’s Natural Heritage: The Boreal
Forest program.
Natural capital includes resources such as minerals,
timber, and oil and gas, which provide the raw materials used
in the production of manufactured goods as well as land and water
resources that support non-market values such as recreational
opportunities, biodiversity and ecosystem services. The methodology
for this part of the report consists of three components. First,
the economic and policy literature was reviewed to generate a
list of fiscal mechanisms that have been applied globally to protect
forest lands. The list was then evaluated in order to focus on
instruments that would be suitable to the boreal forest context:
instruments had to be suitable to the ecological system and relevant
sectors, as well as compatible with existing institutions (such
as property right systems). Stakeholder interviews were conducted
to obtain feedback on challenges facing land managers in managing
for conservation values, ideas for policy reform and incentives
that would help land managers achieve conservation objectives,
and the acceptability of alternative fiscal reforms. Further stakeholder
input was obtained from the case study workshop held in Fort McMurray
on May 3, 2004.
The main findings of this part of the report are
summarized below. Because the provincial government has jurisdiction
over most land and resources within the Al-Pac FMA, the report
focuses on provincial fiscal barriers and opportunities. Note
that many of the opportunities discussed below, such as tradable
development rights, are applicable beyond the boundaries of the
Al-Pac case study and will also increase protection of existing
boreal forest against encroachment by the agricultural fringe.
Barriers
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The Alberta government business
planning model promotes the sector-specific mandates of individual
departments rather than maximizing the potential value of forest
land.
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The tenure and disposition system
for allocating resource rights on public lands generates externalities 1
between sectors and does not incorporate the value of natural
capital.
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FMA agreements have many restrictions
that lead to inefficient use of forest lands and reduce Al-Pac’s
ability to manage for natural capital. These include stumpage
charges, adjacency restrictions, appurtenancy clauses, use-it-or-lose-it
requirements, and the sustained-yield principle, which underlies
calculation of the annual allowable cut.
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Energy sector barriers include
taxes and subsidies that accelerate the exploration and development
of energy resources, petroleum and natural gas lease requirements,
and a lack of charges for access to water.
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Natural resource accounts
and a common set of sustainability indicators managed by all
government departments could be used to improve the business
planning model in Alberta.
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Increased rights to forest resources
other than timber would enhance management for non-timber values
on public lands.
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Transferable development rights
could be used to implement forest or habitat loss thresholds
in the boreal forest.
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Carbon credits could maintain
carbon balances and reduce loss of forest cover.
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Conservation easements could
be used on public lands to maintain habitat.
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Forest investment tax credits
could be applied to forest investments by any sector.
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Access and user charges for non-decommisioned
roads could reduce forest fragmentation and species interactions
related to human access.
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