Evaluation of the Port Operations Program

March 2012

Contents

• Executive Summary
• Section 1: Background
  • 1.1 Scope
  • 1.2 Objectives and Timing
  • 1.3 Evaluation Issues and Questions
  • 1.4 Program Profile
    • 1.4.1 Regional/Local and Remote Operations
    • 1.4.2 The Port Divestiture Program
    • 1.4.3 The National Marine Policy
    • 1.4.4 The Canada Marine Act
• Section 2: Evaluation Findings
  • 2.1 Relevance
    • 2.1.1 Alignment with Federal Roles and Responsibilities
    • 2.1.2 Alignment with Government Priorities
    • 2.1.3 The Continued Need for a Port Divestiture Program
    • 2.1.4 The Need to Continue Operating Regional/Local Ports
    • 2.1.5 The Need to Continue Operating Remote Ports
    • 2.1.6 The Need to Continue Monitoring Harbour Beds and Operating Public Harbours
  • 2.2 Performance
    • 2.2.1 Achievement of Expected Outcomes
    • 2.2.2 Efficiency and Economy
• Section 3: Summary of Key Findings
• Section 4: Conclusions
• Section 5: Recommendations and Management Action Plan

Executive Summary

Transport Canada (TC) owns and manages a diverse suite of maritime assets that include ports, wharves, docks, breakwaters as well as upland and submerged real property. Since the adoption of the National Marine Policy, TC has been working to transfer these assets to other federal departments, provincial governments and local communities through the Port Divestiture Program (PDP). The Program's funding was to sunset on March 31, 2012, however, Budget 2012 committed an additional $27.3M to extend divestiture and operations until 2012- 14. In accordance with the Treasury Board Policy on Evaluation and the Financial Administration Act, this evaluation was conducted in 2011-12 and addresses the Port Operations Program's relevance and its performance from 2007-08 to 2011-12.

Findings and Conclusions

Transport Canada's programs for operating and divesting its remaining ports and harbour beds are at a crossroads. While these assets have lost much of their relevance, they represent a significant and costly set of risks and obligations that the Department has little choice but to manage.

• Relevance: Transport Canada's remaining ports and harbour beds are not a governmental or departmental priority, nor are they a constitutional obligation. Since the adoption of the National Marine Policy in 1996, the Department has been working to transfer these sites to other federal departments, provinces, municipalities and to the private sector. Transport Canada is only operating these facilities because they could not be divested or closed. However, the property management activities associated with these sites will continue to be essential until Transport Canada can transfer or terminate its ownership.
• Effectiveness: Between 2007-08 and 2011-12, the Program generated long term savings of up to $22M by divesting, transferring or demolishing sixteen ports: Six were divested to local municipalities or First Nations, six to non-profit consortiums of local users, two to the Province of Newfoundland and Labrador, one the Department of Fisheries and Oceans and one was demolished. Since 1996, the Program divested, demolished or "deproclaimed" 89% of Transport Canada's 549 ports and harbour beds. However, most of these divestitures were accomplished in the Program's first years, and for the last decade progress slowed. While the Program made port services available to some remote and non-remote communities, many of Transport Canada's ports appear not to be actively utilized as commercial wharves, and a number of the remote ports no longer comply with the National Marine Policy.
• Efficiency & Economy: While divestiture has undoubtedly reduced Transport Canada's costs over the long-term, it is difficult to quantify these savings. However, the National Marine Policy indicated that Transport Canada's Regional/Local ports would be divested by 2001-02 at a cost of $125M.  As of 2010-11, this timetable had been exceeded by nine years, and the budget by $333M. Over the next five years, the program is expected to cost an average of $36M per year if all necessary capital repairs are undertaken. With its current fees structure, the Program is not cost effective. Many of Transport Canada's Regional / Local and Remote ports require significant investment, and most will operate at a loss over the next five years.

Recommendations

The evaluation makes four recommendations:

• Review Remote Ports: Review its inventory of remote ports to ensure that its remaining assets are still needed by the community and still comply with the definition provided by the National Marine Policy. Ports that no longer qualify as remote should be converted to Regional/Local ports and made available for divestiture or disposal.
• Develop a Strategy: Recognizing that almost all ports that could be divested have been, Port Operations should develop an aggressive strategy to close, demolish, sell, transfer or divest Transport Canada's remaining regional/local ports and harbour beds as quickly and inexpensively as possible. The strategy should also include provisions for operating, maintaining and developing any assets that cannot be sold, transferred or divested over the next two to five years.
• Review User Fees: Review the fees it charges for harbour dues, wharfage, berthage, storage and other services to ensure that there is a logical and defensible relationship between the monies collected from specific groups of users and the cost of providing services to those users, and that an adequate portion of the financial burden for these marine transportation assets has been shifted from taxpayers to users.
• Review Alignment with Transport Canada's Strategic Outcomes: Reassess its place in Transport Canada's PAA to better reflect its role as an asset and liability management program.

Section 1: Background

1.1 Scope

As per the Treasury Board Policy on Evaluation (2009), the Port Operations Evaluation focused on the core issues of relevance and performance:

• Relevance: Continued need for the program, alignment with government priorities and Transport Canada's strategic outcomes, and alignment with federal roles and responsibilities.
• Performance: Effectiveness, efficiency and economy. 

The evaluation examined all the activities comprising the Port Operations sub-sub-activity including the following (see Figure 1):

• Port divestiture
• The operation of regional/local and remote ports
• The monitoring and management of capital assets
• The management of the Harbourmaster and Wharfinger appointment process, and
• The closure, containment and disposition of non-operational ports facilities.

Figure 1: Logic Model

 

Text version of Figure 1

1.2 Objectives and Timing

The objectives of the evaluation were to:

• Assess the progress of the program in achieving divestiture of ports in a cost effective manner
• Assess the program's current approach to divestiture The evaluation was conducted in 2011-12 and covered the five years 2007-08 to 2011-12.

1.3 Evaluation Issues and Questions

The Policy on Evaluation identifies five key issues that should be addressed when evaluating the relevance and performance of a program: Continued need, alignment with government priorities, alignment with federal roles and responsibilities, achievement of expected outcomes and the demonstration of efficiency and economy (see Figure 2).

Figure 2: Evaluation Issues

Relevance
Issue 1: Continued Need for the Program	Is there an on-going need to operate regional/local and remote ports? Is there an on-going need for port divestiture? Is there an on-going need for a contribution program to support port divestiture?
Issue 2: Alignment with Government Priorities	Does the operation and/or divestiture of Transport Canada owned ports align with government priorities and Transport Canada’s strategic outcomes?
Issue 3: Alignment with Federal Roles and Responsibilities	Does the Port Operations Program align with federal roles and responsibilities?
Performance (Effectiveness, Efficiency and Economy)
Issue 4: Achievement of Expected Outcomes	To what extent did the program succeed in divesting ports? To what extent did the program succeed in closing, containing or demolishing ports? To what extent are Transport Canada’s remaining ports operational and fulfilling a local need? To what extent are divested ports responsive to the needs of local users?
Issue 5: Demonstration of Efficiency and Economy	How much has it cost to transfer ports to local interests? Has the Port Operations Program resulted in cost savings? What are the net costs of operating Transport Canada’s remaining ports?

1.4 Program Profile

1.4.1 Regional/Local and Remote Operations

Transport Canada manages a diverse suite of maritime assets that include ports, wharves, docks, breakwaters as well as upland and submerged property. This sub-sub activity also includes the Port Divestiture Program (PDP), which aims to transfer regional/local and remote ports to other federal departments, provincial governments or local communities and users. 

While Head Office provides functional guidance, both the operational and divestiture elements of the program are largely delivered by Transport Canada's regional offices. Over the last 10 years, the annual cost of operating and divesting regional/local and remote ports has ranged from $79M to $28M, with an average annual cost of $49M.  The ports and harbour beds also generate an average of $12M in revenues. While revenues have declined since 2001-02, they have remained above $10M per year for the last five years (see Table 1).

Table 1: Transport Canada Spending Operations and Divestiture (2001-02 - 2010-11)

Spending	2001-02	2002-03	2003-04	2004-05	2005-06	2006-07	2007-08	2008-09	2009-10	2010-11	Average
Revenue and Expenses (Revenue) by Type - $Million
Operations	26.03	20.80	21.75	26.90	17.25	17.46	18.23	21.33	25.50	18.49	21.37
Capital	6.05	2.23	5.35	14.62	3.36	10.19	10.98	21.50	16.62	7.64	9.85
G&C	21.57	22.10	1.70	17.84	58.66	0.51	16.00	0.38	23.81	14.46	17.70
Total Spending	53.65	45.13	28.79	59.36	79.27	28.16	45.22	43.21	65.93	40.60	48.93
Revenue	14.45	13.20	12.39	13.31	12.20	10.14	10.31	10.69	10.17	10.45	11.73
Net Spending	39.20	31.93	16.40	46.05	67.08	18.03	34.91	32.52	55.77	30.14	37.20
Net Spending (Revenue) by Region - $Million
Headquarters	2.98	3.98	4.05	3.77	3.07	1.63	1.63	2.09	8.08	3.06	3.43
Atlantic	4.48	5.80	1.67	14.09	43.83	0.07	0.18	0.12	23.62	0.19	8.99
Quebec	7.23	3.01	8.82	14.13	18.85	13.97	29.87	25.19	20.33	9.45	15.09
Ontario	6.14	1.19	0.81	2.69	0.32	1.56	1.71	2.42	2.35	16.31	3.55
Pacific	18.36	17.95	4.40	11.38	1.01	0.94	1.52	2.94	1.38	1.52	6.14
Net Spending	39.20	31.93	16.40	46.05	67.08	18.03	34.91	32.52	55.77	30.14	37.20

Figure 3: Average Annual Expenditures/Revenues Relating to Regional/Local and Remote Ports (2001-02 - 2010-11) by Region and Type

 

Text version of Figure 3

Transport Canada owns and operates 85 ports and harbour beds across Canada. While Atlantic Region has no remote ports, it manages 17 of 24 harbour beds, and 9 Local/Regional ports. Pacific Region manages 15 remote ports, along with Fort Chipewyan in Alberta and Victoria Harbour which includes a harbour bed and a portfolio of upland properties. Ontario Region manages 8 regional/local ports, a remote port in Manitoba and 6 harbour beds. Quebec Region has half of Transport Canada's ports, including 17 local/regional and 10 remote (see Table 2).

Table 2: Transport Canada Ports and Harbour Beds

Region	Local/Region	Remote	Harbour Bed
Atlantic Region	9	0	17
Pacific Region	1	15	1
Ontario Region	8	1	6
Quebec Region	17	10	0
Sub Totals	35	26	24
	61
Total	85

Over the last five years, Port Operations employed 60-70 staff across Canada, mostly in the regions. Headquarters serves as the functional authority, while the regions are responsible for operations and divestiture negotiations (see Table 3).

Table 3: Approximate Staffing Level (FTE)

Location	2007-08	2008-09	2009-10	2010-11	2011-12
Headquarters	5	5	5	5	5
Atlantic Region	14	14	15	13	10
Quebec Region	16	16	17	17	15.5
Ontario Region	11	11	11	10.5	10.5
Pacific Region	11	12	16	16	13
Total	64	65	70	67.5	61.5

The Minister of Transport also retains the services of Harbour Masters and Wharfingers at its busier sites across Canada. These individuals are part time 'fees of office' Ministerial appointees, rather than Transport Canada employees, and they earn between $3,000 and $43,500 per year depending on the size of their facility and its level of traffic. In recent years, the Program has been working to normalize remuneration across Canada to ensure a consistent relationships between the level of activity and the level of payment.

Harbour Masters are responsible for monitoring activities in designated public harbours. While the principal function of the Harbour Master is to record vessel movements so that appropriate harbour dues can be charged, they also serve as the 'eyes and ears' of Transport Canada's regional offices, offering important local knowledge and presence.

Wharfingers are responsible for monitoring and directing the use of Transport Canada wharves, and for assessing appropriate berthage, wharfage, storage and other fees under the Canada Marine Act. Like Harbour Masters, Wharfingers play an important monitoring and operational role on behalf of the Regional Office. At sites that have both a designated harbour and a Transport Canada wharf, one individual is usually appointed as both the Harbour Master and Wharfinger. Table 4 outlines the number and annual costs associated with Harbour Masters and Wharfingers in each region.

Table 4: Harbour Masters and Wharfingers

Regions	Appointees	Annual Cost ($)
Atlantic Region	23	318,100
Quebec Region	22	280,500
Ontario Region	6	60,200
Pacific Region	2	10,000
Total	53	668,800

1.4.2 The Port Divestiture Program

The Port Divestiture Program (PDP) was implemented in 1996 to transfer 549 regional/local ports. PDP includes a contribution program (the Port Divestiture Fund), as well as funding to operate Transport Canada's remaining ports and a limited budget for capital maintenance.

PDP was extended by one year, to March 31, 2003, and then for another three years until March 31, 2006. After a four month period in which the program was on hold, PDP was extended again until March 31, 2007. The most recent extension of PDP , from April 1, 2007 to March 31, 2012, adopted a 'flexible approach' that pursues divestiture where success is likely, but also allows closing or demolishing sites that pose liabilities to the Crown.

While the National Marine Policy did not discuss what Transport Canada should do with regional/local ports that it failed to divest, recent strategic documents have acknowledged that some ports may never be divested. The reasons for this vary but the most common reasons are a lack of local interest, a lack of commercial activity and, in some cases, federal-provincial agreements that preclude or encumber the transfer of specific ports.

1.4.3 The National Marine Policy

Prior to the adoption of the 1995 National Marine Policy (NMP), the national port system was thought to suffer from significant overcapacity and inefficiency. The extensive involvement of the federal government was viewed as unnecessary, and a constraint on commercial activity.

The National Marine Policy outlines the federal government's strategy to modernize and rationalize the Canadian marine transportation system. The objectives of the policy are:

• To ensure affordable, effective and safe marine transportation services;
• To encourage fair competition based on transparent and consistent rules;
• To shift the financial burden for marine transportation from taxpayers to the user;
• To reduce infrastructure and service levels where appropriate; and
• To continue the Government of Canada's commitment to safe transportation, a clean environment, service to designated remote communities and to meet all constitutional obligations.

1.4.4 The Canada Marine Act

The Canada Marine Act was introduced in 1996 to consolidate and modernize the marine regulatory regime, reduce red tape, allow for faster business decisions and thus, effect many of the changes outlined in the NMP. The Act created three categories for the ports owned by Transport Canada and were recognized, as follows, in the NMP:

• Canada Port Authorities (CPAs): The NMP recognized 17 ports as strategically significant, and vital to domestic and international trade. These ports constitute Canada's National Ports System. While Transport Canada retains ownership of the lands on which these ports are built, they are operated by financially self-sufficient non-profit corporations.
• Remote Ports: Existing Transport Canada ports that were not included in the National Port System were categorized as 'Remote' if they served as the sole mode of transportation for an isolated community for at least part of the year. In the NMP, Transport Canada made a commitment to maintain these facilities on an ongoing basis, or to transfer them to local communities where interest exists.
• Regional/Local Ports: Existing Transport Canada ports that were not included in the National Ports System and did not fit the definition of remote were classed as 'Regional/Local' ports. These facilities ranged from ports with locally significant commercial activity to very small facilities with little or no commercial traffic. The NMP committed to divest these ports over a six-year period from 1996 to 2002 through deproclamation or transfers to other federal departments, provincial governments, municipalities, First Nations or other local interests.

Section 2: Evaluation Findings

2.1 Relevance

2.1.1 Alignment with Federal Roles and Responsibilities

Finding: Transport Canada owns and operates ports and harbour beds for historical rather than strategic reasons. While the Minister of Transport has exclusive authority to designate public ports, this designation is not required to operate a commercial wharf. Since the adoption of the National Marine Policy, Transport Canada has been working to transfer its remaining ports and harbour beds to other federal departments, provinces, municipalities and the private sector.

Section 91 of the Constitution Act gives the federal government control over 'Navigation and Shipping' and Schedule 3 of the 1867 Act transferred ownership of provincial public harbours to the federal government.

The Canada Marine Act recognizes three types of public ports/harbours: Canada Port Authorities, Public Ports and Public Port Facilities operated by Transport Canada (include Transport Canada's Regional/Local and Remote Ports and Harbour beds), and Natural and Man-made Harbours which are controlled by the Department of National Defence. The conduct of ships using private or provincial ports is still regulated under the Canada Shipping Act, but not to the same extent.

Only the Federal Minister of Transportation can proclaim and deproclaim a "public harbour." The use of this designation for smaller ports has declined since the introduction of the Canada Marine Act. While Canada Port Authorities are declared public harbours, most commercial ports facilities in Canada operated by the private sector or other levels of government are not designated.

Under normal conditions, most marine facilities operate adequately without public port status, however, there are advantage to such a designation. First, the Marine Transportation Security Regulations require Canada Marine Act ports to have a Security Committee, conduct a vulnerability assessments and submit Port Security Plans. While other marine facilities can do this on a voluntary basis, a public port designation makes this level of planning mandatory. Also, a public port designation gives the Minister of Transport the authority to regulate and direct marine traffic from the standpoint of efficiency as well as safety and security.

While it may not be necessary to regulate every marine facility to this extent, the public port designation gives the Minister of Transport the authority to apply additional security and administrative controls to strategically significant marine facilities, even if those facilities are owned by the private sector or another level of government.

2.1.2 Alignment with Government Priorities

Finding: Transport Canada's remaining ports and harbour beds are not a governmental or departmental priority. The Regional/Local ports are surplus to the Department's requirements, and have been available for divestiture, sale or demolition since 1996. The Remote ports and harbour beds are managed as legacy commitments, and their operation is peripheral to Transport Canada's strategic objectives.

Federal Government Priorities: Recent Speeches from the Throne have not acknowledged Transport Canada's Regional/Local or Remote ports. While the Program received money in Budget 2007, it was not acknowledged in the Budget Speech or in recent Speeches from the Throne.

Departmental Priorities: The stated objective of the Port Operations sub-sub-activity (PAA 1.3.2.4) is to make port services available to communities. In doing so however, local/regional or remote ports, the Program makes only a nominal contribution to the broader objective of the Marine Infrastructure sub-activity, specifically that Marine Infrastructure is capable of meeting existing and future demand.

Since the introduction of the National Marine Policy in 1995, Transport Canada has been focused on fostering a National Port System comprised of financially self-sufficient Canada Port Authorities. In 2009, 57.2% of Canada's maritime cargo was shipped through Canada Port Authority facilities and 39% was shipped through provincial, municipal and private ports. As Table 5 illustrates, only 4% of Canadian cargo went through Transport Canada's Regional/Local ports.

Table 5: 2009 Cargo Movements by Port Type

Type of Port	Tonnes	Percentage
Source: Statistics Canada
CPA Port	234,216,272	57%
Local/ Regional (TC)	16,244,195	4%
Remote (TC)	13,721	0.003%
All Others	158,670,990	39%
Total	409,145,178	100%

Under the National Marine Policy, Transport Canada's Regional/Local and Remote ports were deemed facilities that should not be operated by the federal government. The Policy sought to transfer these facilities to local users based on the belief that they would be better situated to identify and respond to local needs.

The divestiture of these ports may contribute to efficiency in that it frees Transport Canada of surplus and legacy assets that are no longer seen as essential to the national transportation system.

2.1.3 The Continued Need for a Port Divestiture Program

Finding: With additional funding and authorities, the Program may be able to divest a small portion of the remaining Regional/Local and Remote ports.

The Port Divestiture Program is focused on transferring ports to other levels of government or local non-profit entities willing to operate them as public ports. As an incentive and an enabler, the Program offers the new owners financial contributions based on a 'Crown-no-worse-off' model that considers the value of the property and an estimate of what it would cost Transport Canada to operate the port for 25 years.

An internal review conducted by the Program early in 2012 reported that negotiations were ongoing for eight facilities. In interviews, program staff indicated that they received additional expressions of interest that they could not pursue because funding was not available to conclude additional agreements.

Nevertheless, for a number of reasons it is becoming increasingly difficult to divest ports: Many of the most attractive sites were divested early in the Program; and divestiture of many of the remaining sites is complicated by legal, land claim, environmental or maintenance issues. Second, all of Transport Canada's Quebec ports, and all ports and harbour beds in Newfoundland with the exception of Fortune are subject to reversionary clauses, and cannot be divested without provincial approval. Both provinces have indicated that they would prefer the costs and liabilities associated with these facilities to remain with the Federal government. Third, many of the remaining sites require significant capital investment if they are to continue functioning as commercial wharves. Finally, some small communities do not have the financial or non-financial resources to operate and maintain a commercial port or wharf.

2.1.4 The Need to Continue Operating Regional/Local Ports

Finding: Until Transport Canada can terminate ownership of all of its remaining ports and harbour beds, the Department will need resources to transfer, demolish or manage these assets. Over time, the Program has become a risk and asset management program for facilities that Transport Canada cannot or will not divest.

The National Marine Policy, committed to divesting all Regional/Local ports by 2002, but was silent as to what should happen to any facilities that could not be divested. Today, Transport Canada continues to operate 35 Regional/Local port facilities because new owners have not yet been found. While the program tends to refer to these assets as "ports", they are in fact a diverse portfolio of built assets and real property which include wharves, docks, breakwaters, a canal as well as natural and in-filled upland property. 

Program staff indicated that the complexity of the issues facing some of these facilities was not fully appreciated when the National Marine Policy was introduced. For example, it was not understood that most ports in Newfoundland and all ports in Quebec are subject to 'reversionary clauses,' and can not be divested without provincial cooperation. Further, the challenges associated with site contamination and First Nations property rights were not fully appreciated.

Until Transport Canada can transfer or terminate ownership, the department will continue to have legal and operation responsibility for these sites. Even if the Port Divestiture Fund is not renewed or the sites are closed, Transport Canada will need financial and human resources to manage these assets. 

2.1.5 The Need to Continue Operating Remote Ports

The National Marine Policy designated specific ports as remote if they meet the following criteria:

1. Water transport is the primary mode of transportation for the movement of people and goods for at least some portion of the year;
2. There is dependence specifically on the existing Transport Canada wharf structure along which vessels can tie up safely;
3. The community is not connected by a road network to another site with a wharf and/or not connected to a major centre by year-round surface means or by regular air service.

Transport Canada continues to operate docks or wharves in 26 of the remote communities specified in the National Marine Policy. These facilities are legacy commitments. While the National Marine Policy commits not to force the closure of these sites against a community's wishes, they are available for divestiture, and 35 of the original 61 sites have been transferred or demolished.

Transport Canada's remote ports are legacy assets, and only 0.003% of Canada's maritime cargo was shipped through these ports in 2009. The department has no ports north of the 60^th Parallel, and is committed only to maintaining its existing facilities rather that providing service to all remote communities in Canada.

Between 2005-06 and 2009-10, Transport Canada's remote ports cost an average of $6.4M per year ($1.3M O&M, $5.1M Capital). While TC has agreed to maintain these facilities, they are still available for divestiture, and from an operational perspective, remote port have thus far been treated no differently than regional/local ports. While it has not been important in the past, if the Program were to adopt a more aggressive strategy for terminating federal ownership, the 'Remote" designation could make it more difficult for Transport Canada to sell or close an asset.

2.1.6 The Need to Continue Monitoring Harbour Beds and Operating Public Harbours

Transport Canada continues to own and manage 26 harbour beds, water lots at which it has no port facilities (i.e. Transport Canada owns the submerged land under the harbour, but ships load or unload at private, provincial or municipal wharves or docks, or transfer goods from ship-to-ship).

At Confederation, the Federal Government took ownership of harbours that were deemed to be strategically or militarily important and managed these sites as Public Harbours. In these instances, the Crown owns large areas of submerged and tidal properties, and is responsible for managing the environmental and legal liabilities associated with encroachment (i.e. filling of coastal lands, the construction of wharves or piers, aquaculture operations, dredging, etc.) or activities that could lead to contamination for which the Crown, as property owner, could become responsible.

Where Transport Canada owns a harbour bed, it operates the site as a proclaimed public harbour under the Canada Marine Act. In most cases, the Minister of Transport has named a Harbour Master to facilitate the collection of harbour dues, and to monitor the site on behalf of the Transport Canada regional office.

The Public Ports and Public Port Facilities Regulations, associated with the Act stipulate that Transport Canada cannot deproclaim a harbour until all submerged and upland property has been transferred to another owner. However, it should be noted that it is within the Minter of Transport's powers to amend these regulations through the normal process.

Harbour dues have historically been justified as a contribution to the national marine system. However, since the introduction of the National Marine Policy, the role of ports in Canada's national transportation system has been refocused to emphasize the larger Canada Port Authority facilities. In the present context, Transport Canada collects dues at only some of its harbours, but the policy is not applied consistently.

Because only the federal government is allowed to collect harbour dues, they are only collected in Public Harbours at which Transport Canada owns the harbour bed, and by Canada Port Authorities. Harbour dues collected by CPAs are retained by the CPAs for harbour improvements. Harbour dues collected by Regional/Local ports are netted directly to Transport Canada's operating vote.

Transport Canada collected $4.6M in Harbour dues in 2010-11 (mostly from the harbours at Victoria, the Strait of Canso, Sydney and Come By Chance) resulting in net revenues of $3.7M.  While managing the risks and liabilities associated with harbour beds is time consuming for regional staff, and service standards have been established, in many cases, revenues exceed the cost of operating the harbour beds and the relationship between the $4.6M collected and the services provided is not clear.

Figure 4: Harbour Dues Service Standards

2.2 Performance

2.2.1 Achievement of Expected Outcomes

Finding: Between 2007-08 to 2011-12, the Program divested or transferred 15 facilities. Since its inception in 1996, the Program divested, demolished or deproclaimed 489 of 549 of Transport Canada's ports and harbour beds (89%). In recent years however, progress has slowed.

Over the period of the current evaluation, 2007-08 to 2011-12, the Program dispersed $82M in contributions to divest 15 facilities (see Table 6).

Table 6: Success in Divesting Ports 2007-08 to 2010-12

Property	Recipient	Contribution
* Bamfield was a "partial divestiture."  The East wharf was divested but TC continues to own the remainder. ** Harbour Breton was transferred to the Department of Fisheries and Oceans along with $500,000 in compensation.  this amount was provided to another federal department, it is not a "contribution."
1. Les Escoumins, Que.	Local Government	$15,879,000
2. Trois-Pistoles, Que.
3. Summerside, P.E.I.	Non-Profit Corporation	$20,428,000
4. Evans Bay, B.C.	Local Government	$141,000
5. Port Stanley, Ont.	Local Government	$13,515,000
6. Bamfield, B.C. *	Local First Nation	$620,000
7. Harbour Breton, N.L. **	Department of Fisheries and Oceans	$500,000
8. St. Alban's, N.L.	Newfoundland and Labrador	$3,075,000
9. Milltown, N.L.
10. Fortune, N.L.	Non-Profit Corporation	6,910,000
11. Georgetown, N.L.	Non-Profit Corporation	3,710,000
12. Cap-à-l'Aigle, Que.	Non-Profit Corporation	8,925,000
13. Pointe-au-Pic, Que.
14. Sorel, Que.	Non-Profit Corporation	4,900,000
15. Tadoussac, Que.	Local Government	3,450,000
		Total  $82,053,000

When the Ports Divestiture Program launched in 1996, Transport Canada was responsible for 549 sites. As of March 31, 2012, 211 Public Harbours at which transport Canada had no upland facilities have been deproclaimed, and 278 port sites have been divested or demolished. Figure 5 illustrates that between 1995-96 and 2001-02, the program divested an average of 32 sites per year. In 2002-03, progress began to slow, and since then the program has divested an average of six ports per year. Sixteen sites were divested or demolished since 2007-08. Transport Canada currently owns 61 port sites as well as 24 harbour beds.

Figure 5: Success in Divesting Ports Since 1996

 

Finding: The Program divested ports in a manner that was responsive to the needs of recipient communities.

The 2007 evaluation study found that in general, recipients since 1996 were satisfied with the divestiture process and its outcomes. Also, there was evidence to suggest that local users were satisfied with the ports under local ownership, that the ports were managed in a manner that was more responsive to local needs, with appropriate user fees.

In 2011-12, interviews were conducted with four operators of five ports that were divested to local interests since 2007-08. Although a number of interviewees commented that the divestiture process was challenging, the operators indicated that Regional staff were fair and professional, and negotiated in good faith. All those interviewed were optimistic about the future of their ports, and agreed that they were more responsive to local needs now that they were under local control.

Finding: Between 2007-08 and 2011-12 the Program succeeded in selling three parcels of land around Vitoria Harbour, generating $273K. Since its inception in 1996, the program has sold a total of 73 assets, generating $15M.  However, progress is slowing, and most recent sales have been parcels of land surrounding Victoria Harbour rather than distinct port facilities.

As Figure 6 illustrates, since 1996, the Program has generated $15,086,732 by selling 73 port assets. Since 2006, the number of sales per year has been low (typically one) and sales revenues are increasingly coming from the sale of lands around Victoria harbour ($4.7M since 2003).

Figure 6: Long Term Success in Selling Ports

 

Text version of Figure 6

Finding: Between 2007-08 and 2011-12 the Program demolished one port.

Program documents indicate that between 1996-97 and 2005-06, eight ports were closed and demolished (see Table 7). In interviews, Program staff indicated that the wharf in Roddickton, Newfoundland was also demolished during the 2011-12 fiscal year. Program staff indicated that demolition was often unattractive as a means of terminating Transport Canada's ownership because it requires Ministerial approval and because of the high cost of site remediation and restoration. It was possible to move forward with the demolition of Roddickton because there were no significant opposition in the affected communities.

Program staff recognized that Transport Canada's inability or unwillingness to demolish surplus assets was most likely hurting the performance of the divestiture program. As noted by a number of interviewees, the threat of demolition could spur interest in some ports still in Transport Canada's inventory.

Table 7: Ports Demolished as of March 31, 2012

Year	Port
1996-1997	Saint- Augustin, Que. (Île de la Conserverie)
1997-1998	Ladysmith, B.C.
1998-1999	Cadboro Bay, B.C.
1999-2000	Thurso, Que.
2002-2003	Port Simpson, B.C.
2004-2005	Fort Albany, Ont.
	Baie Verte, N.L.
2005-2006	Bushell , Sask. (Black Bay)
2011-2012	Roddickton, N.L.

Finding: The Program provided docks and wharves in some non-remote communities. However, only 8 of 35 of Transport Canada's Regional/Local facilities appear to be actively utilized as commercial wharves or ports. 

Eight of Transport Canada's Regional/Local ports appear to be actively utilized as commercial wharves or ports with ongoing relevance to the community and the region: Long Pond Manuels, Baie-Comeau, Gaspé, Gros-Cacouna, Matane, Rimouski, Sarnia and Owen Sound.

Seventeen of Transport Canada's Regional/Local ports appear to be active, but are being used as something other than a commercial wharf. Seven facilities are operated primarily for the benefit of provincial, First Nations or private ferry services: Fortune, Notre-Dame-du-Lac, St-Juste-du-Lac, South Baymounth, Tobermory and Walpole Island. To varying extents, three assets may be used for heritage conservation, recreation or tourism: Lunenburg, Pointe-au-Père, Portneuf. Three assets appear to be utilized in a limited way, often by a single company: Liverpool, Les Méchins and Cornwall. Finally, the suite of properties that Transport Canada owns around Victoria Harbour and the Burlington Canal represent a unique set of real property challenges, and in the case of Victoria, financial opportunities.

Twelve of Transport Canada's Regional/Local ports appear to be surplus to local and regional needs: Botwood, Charlottetown, Marystown, Terenceville, Carleton, Chandler, Miguasha-Ouest, Mont-Louis, Paspébiac, St-François ,Vieux-Fort, Pelee Island. In some instances these sites are barricaded and closed to the public. 

Finding: A number of the Remote Ports no longer comply with the definition of "remote" in the National Marine Policy, and there is currently no process for reassessing a port's remote designation.

9 ports (Harrington Harbour, La Romaine, La Tabatière, St-Augustin (Pointe-à-la-Truite), Tête-à-la-Baleine; False Bay, New Brighton, Rivers Inlet, Surge Narrows) continue to comply with the definition of remote in the National Marine Policy, and no change is anticipated in the foreseeable future. While these facilities appear to be important to local users/residents, and are in fair or good condition, the community is currently showing no interest in divestiture.

Blanc-Sablon and Natashquan no longer fit the definition of 'Remote,' because they are now connected to the provincial road system, but these ports are still important as a point of departure for other remote communities. Kegaska still qualifies as remote for the time being, however the community will be reached by the provincial road system in the next decade. Cap-aux-Meules in Iles-de-la-Madeleine, was proclaimed as a remote port, even though it has never complied with the criteria in the National Marine Policy.

3 facilities (Baie-Johan-Beetz, Berens River and Sandspit) no longer comply with the definition of Remote, and are underused. These sites have very limited activity, and future demand may not justify continued operation. These facilities are in poor condition and demolition may be considered. 

Bamfield West and Fair Harbour remain remote but may be divested in the near future.

The role of a number of remote ports in Pacific Region including Bella Bella, Hartley Bay, Kingcome Inlet, Klemtu, Kyuquot, Owen Bay, Port Neville and Quatsinois is uncertain. These wharves and docks are utilized, but they may not be fulfilling a basic need for these communities. In some cases other facilities exist, and others are primarily used for recreational watercraft.

2.2.2 Efficiency and Economy

Finding: Based on the model used in the 2002 and 2007 evaluations, port divestiture can be seen as saving Transport Canada money through cost avoidance. However, in 2012, this method of calculating costs may no longer be appropriate.

The 2007 Evaluation reported that based on figures supplied by the Program, Port Divestiture had saved $274.4M as of March 31, 2007 (calculated using constant 2005-06 dollars). As Table 8 illustrates, based on this model, and adjusting for inflation, an argument could be made that port divestiture has now saved a total of $437.49M as of March 31, 2011 (calculated using constant 2010-11 dollars). This model of calculating cost savings is no longer appropriate. Savings initiated in previous decades should not necessarily be counted as savings in every subsequent fiscal year.

Table 8: Savings March 31, 2010, $Million (Adjusted 2010-11 Dollars)

Type	Avoided Costs
Average Operational Cost
Avoided Costs	776.85
Revenues from Sales	16.50
Sub-total	793.35
Contribution
Initial - 1996	136.17
Added - 2002	93.36
Lapsed	-7.63
Added - 2007	61.40
Sub-total	283.31
One-Time Expenditures	72.55
Net Total	437.49

Finding: The fourteen divestitures concluded between 2007-08 and 2011-12 are expected to save Transport Canada up to $22M over the next 25 years. Additional costs may also have been avoided through the demolition or transfer of two other facilities.

The Program's Port Divestiture Guidelines dictate that divestitures will be based on a Crown No Worse Off model (CNWO). The CNWO dictates that "no proposal will be accepted if it is determined that it would leave the Crown in a worse position relative to the alternative of continued Transport Canada operations. The Crown's position is determined through a financial cash flow analysis that takes into account projected revenues, operating and overhead expenses and capital expenditures for the foreseeable future."

Corporate Finance provides CNWO analyses to Programs Group and Regional Staff in support of divestiture negotiations. The CNWO provides a net present value estimate of what it would cost Transport Canada to continue operating a facility for 25 years, as well as a sensitivity analysis that allows for a 10% variance in direct operating and capital expenditures. The CNWO calculations reflect the total cost of continuing Crown operations, less any remaining overhead costs (including allocated regional overhead costs, HQ Programs costs, and corporate support costs).

The CNWO produces high and low values that form the reference range that guide regional staff in their negotiations with local interests. It is expected that Transport Canada negotiators will work to conclude an agreement that is in the best interest of the Crown (i.e. as close to the most optimistic estimate as possible). Table 9 identifies the potential savings that Transport Canada could realize from each of its divestitures over the next 25 years. 

Table 9: Potential Savings from Divested Ports - 2007-08 to 2011-12

Port	Negotiating Range	Divestiture Amount	Potential Savings ($)
* St Alban's and Milltown were separate facilities divested to the same recipient.  In this instance a joint  Crown No Worse of Calculation was prepared for both properties.
Port Stanley	[ATIP Removed]	$13.52M	[ATIP Removed]
Les Escoumins	[ATIP Removed]	$15.88M	[ATIP Removed]
Trois-Pistoles	[ATIP Removed]
St Alban's & Milltown (2 Ports)*	[ATIP Removed]	$3.08M	[ATIP Removed]
Summerside	[ATIP Removed]	$20.43M	[ATIP Removed]
Bamfield East	[ATIP Removed]	$620K	[ATIP Removed]
Evans Bay	[ATIP Removed]	$141K	[ATIP Removed]
Fortune	[ATIP Removed]	$6.91M	[ATIP Removed]
Georgetown	[ATIP Removed]	$3.71M	[ATIP Removed]
Cap-à-l'Aigle	[ATIP Removed]	$8.93M	[ATIP Removed]
Pointe-au-Pic	[ATIP Removed]
Sorel	[ATIP Removed]	$4.9M	[ATIP Removed]
Tadoussac	[ATIP Removed]	$3.45M	[ATIP Removed]
	Total Projected Savings:	$21.79M

While formal Crown No Worse Off calculations were not prepared, additional costs may also have been avoided through the demolition of Transport Canada's facility in Roddickton, Newfoundland and the transfer of Transport Canada's property in Harbour Breton, Newfoundland to the Department of Fisheries and Oceans (see Table 10).

Table 10: Savings from Demolished or Transferred Ports - 2007-08 to 2011-12

Port	Action Taken	Cost	Possible Savings
Harbour Breton	Transfer to DFO	$500K	A formal cash flow analysis was not undertaken before the port was transferred to DFO in 2007-08, however an analysis was prepared in 1999 which suggested it would have cost Transport Canada $2.3M to operate that port for 25 years.
Roddickton	Demolition	$484K	This facility was in an advanced state of deterioration and closed to traffic.  An indicative estimate prepared in 2000 suggested that reconstruction would have cost $5.9M; however there was insufficient commercial traffic to justify reconstruction.

Finding: The National Marine Policy indicated that Transport Canada's Regional/Local ports would be divested by 2001-02 at a cost of $125M.  As of 2010-11, this timetable had been exceeded by nine years, and the budget by $333M. Over the next five years, the program is expected to cost an average of $36M per year if all necessary capital repairs are undertaken.

The National Marine Policy indicated that Transport Canada's Regional/Local ports would be divested over a six year period ending in 2001-02 at a cost of $125M.  As Table 11 illustrates, over the last four years the Port Operations program has cost $36M per year, and over the next five years it is expected to cost $42M per year. So far, Transport Canada has extended this program by nine years, and exceeded the initial budget by $332.82M ($356.24M in constant 2010-11 $). Transport Canada lost base funding for Regional / Local Ports during Program Review in 1995 under the assumption that these assets would be phased out, and currently has no base funding with which to operate its Regional/Local ports.

Table 11: Financial Results for Transport Canada Ports, 2002-03 – 2010-11 (Millions of dollars)

Expenditures/Income	2002-03	2003-04	2004-05	2005-06	2006-07	2007-08	2008-09	2009-10	2010-11
Revenue	13.20	12.39	13.31	12.20	10.14	10.31	10.69	10.17	10.45
Salaries	5.41	5.55	5.62	4.82	3.78	4.47	4.94	5.75	4.61
O&M	15.39	16.20	21.28	12.42	13.68	13.77	16.39	19.75	13.88
Operating income (loss)	-7.60	-9.36	-13.59	-5.05	-7.32	-7.92	-10.64	-15.34	-8.04
Capital Expenditures	2.23	5.35	14.62	3.36	10.19	10.98	21.50	16.62	7.64
Grants and contributions	22.10	1.70	17.84	58.66	0.51	16.00	0.38	23.81	14.46
Net Income (loss) in Real $	-31.93	-16.40	-46.05	-67.08	-18.03	-34.91	-32.52	-55.77	-30.14
Total (Unadjusted)	-332.82
Net Income (loss) in 2010/11 $	-37.02	-18.67	-51.30	-73.07	-19.28	-36.56	-33.30	-56.89	-30.14
Total (2010-11 $)	-356.24

Finding: With its current fee structure, the Program is covering its costs. Many of Transport Canada's Regional / Local and Remote ports require significant investment, and most will operate at a loss over the next 5 years.

One of the core principles of the National Marine Policy was that the cost of the marine system should be shifted from taxpayers to users. Of a total of 85 assets, only nine harbour beds will generate positive revenues. All of Transport Canada's 61 ports and the remaining harbour beds will operate at a loss over the next five years. Half of the revenues collected come from these nine harbour beds, and most of these funds (39%) come from four sites: Come by Chance, Strait of Canso, Sydney and Victoria. The program estimates these ports will require $121M in capital investments in the next 5 years, with 31 ports requiring major investments of more than $500,000.

Table 12: Cost Effectiveness of Transport Canada Owned Ports and Harbour Beds

	Average Projected Annual Costs (2012-13 to 2016-17)						5 Year
Region	O & M	Overhead	Capital	PILT	Revenues	Net Income (Loss)	Projected Total
9 assets are expected to generate positive revenues (% of Total): Come by Chance Harbour (26%), Hantsport Harbour (0.23%), Port-aux-Basques Harbour (2.71%), Strait of Canso Harbour (37%), Sydney Harbour (8%), Churchill (0.43%), Sarnia (1.38%), Sault Ste-Marie (1.23%), Victoria Harbour (22%).  Also, if capital expenditures are excluded, the port of Baie Comeau is expected to generate a small operating surplus.
Atlantic Region	1,854,959	658,590	2,231,600	1,358	3,662,753	(1,083,754)	(5,418,772)
Quebec Region	11,931,126	2,940,755	18,260,663	110,037	3,978,852	(29,263,728)	(146,318,639)
Ontario Region	2,722,088	393,502	3,629,288	51,020	1,040,842	(5,755,056)	(28,775,282)
Pacific Region	816,704	224,353	55,449	0	1,042,636	(53,870)	(269,349)
	17,324,877	4,217,200	24,177,000	162,415	9,725,084	(36,156,408)	(180,782,042)

Section 3: Summary of Key Findings

Relevance

• 1. Transport Canada owns and operates ports and harbour beds for historical rather than strategic reasons. While the Minister of Transport has exclusive authority to designate public ports, this designation is not required to operate a commercial wharf. Since the adoption of the National Marine Policy, Transport Canada has been working to transfer its remaining ports and harbour beds to other federal departments, provinces, municipalities and the private sector.
• 2. Transport Canada's remaining ports and harbour beds are not a governmental or departmental priority. The Regional/Local ports are surplus to the Department's requirements, and have been available for divestiture, sale or demolition since 1996. The Remote ports and harbour beds are managed as legacy commitments, and their operation is peripheral to Transport Canada's strategic objectives.
• 3. With additional funding and authorities, the Program may be able to divest a small portion of the remaining Regional/Local and Remote ports.
• 4. Until Transport Canada can terminate ownership of all of its remaining ports and harbour beds, the Department will need resources to transfer, demolish or manage these assets. While further divestitures may still be possible, the Port Divestiture Program is nearing its end, and gradually evolving into a risk and asset management program for the facilities that Transport Canada cannot or will not divest. 

Performance – Achievement of Expected Outcomes

• 5. Between 2007-08 to 2011-12, the Program transferred or divested or transferred 15 facilities. Since its inception in 1996, the Program divested, demolished or deproclaimed 489 of 549 of Transport Canada's ports and harbour beds (89%). In recent years however, progress has slowed.
• 6. The Program divested ports in a manner that was responsive to the needs of recipient communities.
• 7. Between 2007-08 and 2010-11 the Program succeeded in selling three parcels of land around Vitoria Harbour, generating $273K. Since its inception in 1996, the program has sold a total of 73 assets, generating $15M.  However, progress is slowing, and most recent sales have been parcels of land surrounding Victoria Harbour rather than distinct port facilities. Between 2007-08 and 2010-11, only one port was demolished.
• 8. The Program provided docks and wharves in some non-remote communities. However, only 8 of 35 of Transport Canada's Regional/Local facilities appear to be actively utilized as commercial wharves or ports.
• 9. A number of the Remote Ports no longer comply with the definition of "remote" in the National Marine Policy, and there is currently no process for reassessing a port's remote designation. 

Performance – Efficiency and Economy

• 10. Based on the model used in the 2002 and 2007 evaluations, port divestiture can be seen as saving Transport Canada money through cost avoidance. However, in 2012, this method of calculating costs may no longer be appropriate.
• 11. The fourteen divestitures concluded between 2007-08 and 2011-12 are expected to save Transport Canada up to $22M over the next 25 years. Additional costs may also have been avoided through the demolition or transfer of two other facilities.
• 12. The National Marine Policy indicated that Transport Canada's Regional/Local ports would be divested by 2001-02 at a cost of $125M.  As of 2010-11, this timetable has been exceeded by nine years, and the budget by $333M. Over the next five years, the program is expected to cost an average of $36M per year if all necessary capital repairs are undertaken.
• 13. With its current fees structure, the Program is not cost effective. Many of Transport Canada's Regional / Local and Remote ports require significant investment, and most will operate at a loss over the next 5 years.

Section 4: Conclusions

• Port Divestiture has been a long-term success for Transport Canada; it has transferred or disposed of most of the Department's surplus and legacy marine sites, and has done so in a way that has benefited local communities. However, in recent years, opportunities for divestiture have been scarce and the program is approaching its end. 
  ― Finding 5
• Transport Canada has long term obligations with no long-term source of funds, and has yet to develop a realistic strategy to terminate or manage its remaining obligations. The Port Divestiture Program has been renewed four times, but Transport Canada has never articulated a long-term strategy for managing the operation or divestiture of these assets. The National Marine Policy committed to divest these ports by 2002, but gave no guidance as to what would happen if that goal was not reached. Based on that assumption, Transport Canada has been conducting only minimal maintenance for the last 15 years, and the base budget for these ports disappeared following the program reviews of the 1990s. 
  ― Findings 4, 12 and 13
• Port operations and divestiture makes only a nominal contribution to the goals of the Marine Infrastructure Program, and there is evidence that most of the regional/local ports are no longer actively utilized as commercial wharves. While the National Marine Policy does provide a policy rationale for operating remote ports, there is evidence that some of these ports no longer qualify for remote status. 
  ― Findings 1, 2, 9 and 10
• The real value of this program is in the management and transfer of surplus and legacy assets, not in the provision of port services. The costs and liabilities associated with Transport Canada's remaining ports and harbour beds are substantial, and there is no fast or inexpensive way to withdraw from these obligations. Until Transport Canada can find new owners for these sites, it will need to commit human and financial resources to manage or close them. 
  ― Findings 1, 2, and 4
• The program is focused on transferring ports to local non-profit entities willing to operate them as public ports, rather terminating federal ownership as quickly and inexpensively as possible. While gifting facilities to local partners along with money for operations and investment may be the most collaborative and locally responsive method of divestiture, it is slow, it is costly, and it appears to be reaching the limits of what it can accomplish. Where divestiture has not succeeded, Transport Canada should consider other options. 
  ― Findings 3, 5, 6, 7 and 8
• Transport Canada's current fee structure does not reflect the cost of operations. The harbour dues charged to users in Come by Chance, the Strait of Canso, Sydney Harbour and Victoria Harbour exceed the cost of servicing those users. At the same time, the fees charged to users at most of Transport Canada's regional/local ports are not sufficient to cover the cost of operating those facilities. 
  ― Finding 13

Section 5: Recommendations and Management Action Plan

Recommendation	Proposed Action with Expected Completion Date	OPI
1. Port Operations should review its inventory of remote ports to ensure that its remaining assets are still needed by the community, and still comply with the definition provided by the National Marine Policy.  Ports that no longer qualify as remote should be reclassified as Regional/Local ports and made available for divestiture or disposal.	Airport and Port Programs will endeavour to visit and develop a comprehensive understanding of its remaining 26 Remote Ports. The information gathered will enable the Department to properly categorize the Ports and determine how they will be reflected in the strategy noted below, in terms of those where it may be possible to terminate TC’s interest  and those where TC will continue operations. Completed:  Summer 2012	AHP
2. Recognizing that almost all ports that could be divested have been, Port Operations should develop an aggressive strategy to close, demolish, sell, transfer or divest Transport Canada’s remaining regional/local ports and harbour beds as quickly and inexpensively as possible.  The strategy should also include provisions for operating, maintaining and developing any assets that cannot be sold, transferred or divested over the next two to five years.	Programs Group will develop an aggressive strategy to terminate Transport Canada’s interest in its remaining Ports as quickly and inexpensively as possible. The strategy will include an asset management plan for those Ports where TC’s interests cannot be terminated. [ATIP Removed]. Target Date:  Winter 2013	AHP
3. Port Operations should review the fees it charges for harbour dues, wharfage, berthage, storage and other services to ensure that there is a logical and defensible relationship between the monies collected from specific groups of users and the cost of providing services to those users, and that an adequate portion of the financial burden for these marine transportation assets has been shifted from taxpayers to users.	Airport and Port Programs, supported by the Regions, will then initiate a review of the fees it charges for harbour dues, wharfage and berthage for the ports that are expected to remain under the purview of TC, if any. The review will include consultations with the regional stakeholders and industry. A working group will provide oversight and prepare a report of the findings. Target Date:   Winter 2014	AHP
4. Senior management should reassess this program’s place within Transport Canada’s Program Activity Architecture (PAA) to better reflect its role as an asset and liability management program.	The structure of the PAA is reviewed annually in order to, among other things, ensure proper placement of programs.  Airport & Port Programs will undertake an assessment of the placement of the Port Operations program during the next review cycle in January/February 2013 and, if the assessment demonstrates the program would be better placed elsewhere, will seek approval to have it moved. Target Date: Early 2013	AHP