Skip to content

Timber harvesting contractors get some security

Forests Minister Doug Donaldson.
Forests Minister Doug Donaldson.

The province has contributed $500,000 to the Forestry Service Providers Compensation Fund to protect eligible forestry and silviculture contractors, and service providers, in the event of licensee insolvency.

Minister of Forests, Lands, Natural Resource Operations and Rural Development Doug Donaldson announced the one-time grant at the at the Interior Logging Association’s 60th annual conference and trade show.

“Forestry contractors are an extremely important link in the B.C. forest sector supply chain,” said Donaldson, in a news release. “The compensation fund offers the confidence they need in their business and personal lives that they will get paid for work done, despite any possible licensee insolvency, and we are proud contributors.”

The Forestry Service Providers Protection Act was passed in spring 2010, to protect the financial interests of timber-harvesting contractors who have provided logging and related services to licensees. It includes two components: a lien and a compensation fund. The compensation fund was established in summer 2012, with $5 million in seed funding from the provincial government and the appointment of a fund manager.

As of April 24, 2018, the fund has provided $484,743 in distributions related to three small insolvencies since inception and, with this 2018 grant, approximately $8 million remains available.

In December 2016, the Forest Service Providers Compensation Fund regulation was amended to broaden to the definition of “forest service provider” to include silviculture contractors and individuals who carry out activities for growing seedlings, or carry out activities that are necessary for establishing free-growing stands. Those who perform this work are now protected by the fund under a silviculture sub-account. This one-time grant will be split evenly, with $250,000 going to the general fund and to the silviculture sub-account, respectively.

The Forestry Service Providers Compensation Fund was established to give relief to eligible forestry contractors that were not paid for forestry service they have provided, because the licensee that received the services became insolvent.

Leave a comment

Your email address will not be published. Required fields are marked *