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Land use change in the orchard areas of the Okanagan Valley of British Columbia : a case study 1974

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a LAND USE CHANGE IN THE ORCHARD AREAS OF THE OKANAGAN VALLEY OF BRITISH COLUMBIA. A CASE STUDY by KENNETH BRADFORD MARSHALL (B.Sc.F., U n i v e r s i t y of New Brunswick, 1971) A THESIS SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE IN BUSINESS ADMINISTRATION i n the F a c u l t y of COMMERCE AND BUSINESS ADMINISTRATION We accept t h i s t h e s i s as conforming to the requ i r e d standard THE UNIVERSITY OF BRITISH COLUMBIA September, 19 7 4 In presenting t h i s t h e s i s i n p a r t i a l f u l f i l m e n t of the requirements f o r an advanced degree at the U n i v e r s i t y of B r i t i s h Columbia, I agree th a t the L i b r a r y s h a l l make i t f r e e l y a v a i l a b l e f o r reference and study. I f u r t h e r agree that permission f o r extensive copying of t h i s t h e s i s f o r s c h o l a r l y purposes may be granted by the Head of my Depart- ment or by h i s r e p r e s e n t a t i v e s . I t i s understood t h a t copying or p u b l i c a t i o n of t h i s t h e s i s f o r f i n a n c i a l gain s h a l l not be allowed without my w r i t t e n permission. Department The U n i v e r s i t y of B r i t i s h Columbia Vancouver 8, Canada /7 /3-7f ABSTRACT The renewed i n t e r e s t i n the p r e s e r v a t i o n of a g r i - c u l t u r a l land i n B r i t i s h Columbia, brought about by the a g r i c u l t u r a l land freeze i n December 1972 and the passage of B i l l 42, the Land Commission Act i n A p r i l 1973; estab- l i s h e d an i n t e r e s t i n g environment i n which to analyze land use change i n the Okanagan V a l l e y . The l o s s of commercial orchard land i n the P e n t i c t o n area to r e s i d e n t i a l and r e c r e a t i o n a l uses had caused the Planning D i r e c t o r of the Okanagan-Similkameen Regional D i s t r i c t to r e q u i r e t h a t a l l major development must be made under a land use c o n t r a c t . This r e l a t i v e l y new planning t o o l had been used i n an orchard area near P e n t i c t o n . This t h e s i s i s p r i m a r i l y a micro-economic a n a l y s i s of the land use and changes to t h a t use i n t h i s area. I t i s a case study which discusses the reasons be- hind the d e s i r e to change the land use, the e f f e c t s of the marketing o r g a n i z a t i o n of the t r e e - f r u i t i n d u s t r y and govern- mental i n f l u e n c e s which a f f e c t the i n d u s t r y as a whole. The I n t e r n a t i o n a l problems a f f e c t i n g the t r e e - f r u i t i n d u s t r y are also analyzed as i s t h e i r e f f e c t on the i n d i v i d u a l o r c h a r d i s t . The contention of t h i s study i s that although B i l l i i 42 may have attempted to c o r r e c t one of the symptoms of an a i l i n g i n d u s t r y , more e f f o r t w i l l have to be extended to el i m i n a t e the causes. TABLE OF CONTENTS Page ABSTRACT i i LIST OF TABLES v i LIST OF FIGURES v i i ACKNOWLEDGMENT v i i i Chapter I INTRODUCTION , 1 The S e t t i n g 3 P h y s i c a l D e s c r i p t i o n 3 The Economic Status of the Okanagan V a l l e y , 6 I I THE TUMBLEMOON RANCH CASE STUDY 11 The Economic H i s t o r y of Tumblemoon Ranch, 1958-1972 14 The Orchard Operations, 1958-1972 16 The E a r l y S u b d i v i s i o n s Schemes 33 The Land Use Contract - The December 1972 Scheme 41 A Change i n P o l i t i c a l Power 46 I I I FORCES INFLUENCING LAND USE CHANGE WITHIN THE TREE-FRUIT INDUSTRY 56 N a t i o n a l and I n t e r n a t i o n a l Problems 6 0 The Regional Problems .. 67 Technology - Is the T r e e - f r u i t Industry of B r i t i s h Columbia Keeping Pace? 70 IV WILL LITERATURE Appendix A Appendix B AppGndix C Page The Average Income of the O r c h a r d i s t i n the Okanagan V a l l e y , 78 The Economic U n i t 80 The T r e e - F r u i t Marketing Organization i n B r i t i s h Columbia 83 SOCIETY PAY ITS DEBT? 8 8 CITED 94 STEREOSCOPIC PAIR OF AERIAL PHOTOGRAPHS OF TUMBLEMOON RANCH 9 9 TUMBLEMOON RANCH, INCOME STATEMENTS, 1958 TO 1972 . .- 100 LAND USE CONTRACT 115 1973 - SUBDIVISION PLAN UNDER LAND USE , N CONTRACT 131~ p>Q LIST OF TABLES Table Page 1 LAND USE AND LAND USE CHANGES TUMBLEMOON RAN C H ̂  1946 1973 •••••*•••••••••••••••••••••• 15 2 DEPRECIATION SCHEDULE - 197 2 20 3 TOTAL INCOME BY CROP YEAR COMPARED WITH INCOME BY TAXATION YEAR ..................... 22 4 ANNUAL EXPENSES BY EXPENSE CLASS 1 TUMBLEMOON RANCH, 1958-1972 26 5 DISTRIBUTION OF AVERAGE PRODUCTION COSTS BY EXPENSE CLASS, TUMBLEMOON RANCH COMPARED WITH WASHINGTON STATE 2 9 6 NET INCOME BEFORE AND AFTER DEPRECIATION EXPENSE 32 7 LOT SALES, 1964 AND 1971 SUBDIVISION 35 8 1971 SUBDIVISION COSTS AND RETURNS 39 9 LAND AREA BY USAGE AND DEVELOPMENT CATEGORY - DECEMBER 1972 LAND USE CONTRACT .. 47 10 LAND AREA BY USAGE AND DEVELOPMENT CATEGORY - APRIL 1973 LAND USE CONTRACT 53 LIST OF ILLUSTRATIONS Figure Page 1 THE OKANAGAN VALLEY OF BRITISH COLUMBIA 4 2 LOCATION OF THE CASE STUDY AREA IN THE OKANAGAN VALLEY 7 3 TUMBLEMOON RANCH CROP RETURNS AND NET ORCHARD INCOME, 195 8 TO 1972 ' 18 4 RETURNS - CROP YEAR COMPARED WITH TAXATION YEAR 2 3 . 5 MINIMUM ANNUAL TEMPERATURES, PENTICTON AIRPORT 1958 TO 1971 25 6 AVERAGE CROP RETURNS PER TON, BY CROP YEAR 34 7 1971 SUBDIVISION - PLAN 21364 37 8 1971 SUBDIVISION EXTENSION, PLAN 23475 42 ACKNOWLEDGMENT I would l i k e to express my a p p r e c i a t i o n to Professor W. F. Smith of the U n i v e r s i t y of C a l i f o r n i a at Berkeley f o r h i s encouragement and guidance w h i l e I researched t h i s t h e s i s , and to Pr o f e s s o r S. W. Hamilton f o r the d i r e c t i o n and time spent i n correspondence w h i l e the d r a f t was being prepared. I am indebted to personnel of the New Brunswick Department of Na t u r a l Resources; i n p a r t i c u l a r to Mrs. W. B. P r i c e f o r t y p i n g the manuscript, to Mr. W. F. H. Carr and Mr. C. A. Cameron f o r t h e i r cartographic work and to Mr. D. A. Wolstenholme, D i r e c t o r of Forests Branch f o r h i s general support and i n t e r e s t . LAND USE CHANGE IN THE ORCHARD AREAS OF THE OKANAGAN VALLEY OF BRITISH COLUMBIA. A CASE STUDY "Well, i n our country," s a i d A l i c e , s t i l l p anting a l i t t l e , "you'd g e n e r a l l y get to some- where e l s e - i f you ran very f a s t f o r a long time as we've been doing." "A slow s o r t of country!" s a i d the Queen. "Now here, you see, i t takes a l l the running you can do, to keep i n the same place. I f you want to get somewhere e l s e , you must run at l e a s t twice as f a s t as t h a t . " 1 The p l i g h t of a great number of B r i t i s h Columbia o r c h a r d i s t s i s s i m i l a r to the s i t u a t i o n which the Queen desc r i b e s . ' I t takes a l l the running' they can do t o remain i n the same r e l a t i v e economic p o s i t i o n as the year before. The economic v i a b i l i t y of the orchard land i s not w i t h i n the o r c h a r d i s t s ' c o n t r o l because of such f a c t o r s as c l i m a t i c c o n d i t i o n s , market demands, f o r e i g n and n o n - l o c a l domestic production, f r u i t q u a l i t y and a v a i l a b i l i t y and q u a l i t y of farm l a b o r . The o r c h a r d i s t i s at the mercy of these and other forces which determine h i s net farm income from h i s orchard operations. Such i s the s i t u a t i o n , where the average age of XLewis C a r r o l l , "Through the Looking Glass and What A l i c e Found There", Chapter 2, Macmillan, 1871, c i t e d i n THE ANNOTATED ALICE, A l i c e ' s Adventures i n Wonderland and Through the Looking Glass by Lewis C a r r o l l , I n t r o d u c t i o n and Notes by Ma r t i n Gardner Clarkson N. P o t t e r , I n c . / P u b l i s h e r , New York, 1960, page 210. a sample of Okanagan o r c h a r d i s t s was 48 y e a r s 2 and the annual average labor income to the operator was $-620 i n 3 . 1970. The orchard business i s i n t r o u b l e i n the Okanagan V a l l e y , and i f the o r c h a r d i s t were a hard-nosed business man, he would see the hopelessness of h i s p l i g h t , s e l l h i s land and i n v e s t h i s money and l a b o r i n some e a s i e r pro- f e s s i o n . However, a f t e r December 21, 1972 he could no longer 4 s e l l h i s land f o r s u b d i v i s i o n purposes , and the demand f o r orchard land i n the Okanagan V a l l e y i s poor, w i t h the 1969 crop d i s a s t e r s t i l l v i v i d i n the memory of most o r c h a r d i s t s . The o r c h a r d i s t i s l e f t l i t t l e or no a l t e r n a t i v e but to continue to "run at l e a s t twice as f a s t as t h a t " as the Queen recommends. The changing economic s t r u c t u r e of the Okanagan V a l l e y magnifies the need f o r c o n t r o l of land use change but should i t be to the extent of excluding a g r i c u l t u r a l land from development i n the V a l l e y ? To b e t t e r understand the Caralee Arendt, Costs and Returns on F r u i t Farms i n the Okanagan V a l l e y of B.C., 1969 and 1970, Economics Branch, A g r i c u l t u r e Canada, Vancouver, B.C. Economics Branch P u b l i c a t i o n No. 73/1, Report Completed i n December 1972, Amended June 1973, page 3. 3 I b i d . , p. 6. 4 Order-in-Council 4483, December 21, 1973; pur- suant to the Environment and Land Use Act, c i t e d i n "B.C. Gazette", P a r t I I , Regulation 4 of 1973, January 11, 1973; and Order-in-Council 157, c i t e d i n "B.C. Gazette", February 8, 1973; Queen's P r i n t e r , Parliament B u i l d i n g s , V i c t o r i a , B.C. - under which O r d e r s - i n - C o u n c i l , a l l s u b d i v i s i o n of farmland was p r o h i b i t e d . The Land Commission Act ( B i l l 42), passed A p r i l 16, 1973 a f t e r prolonged p u b l i c debate f u n c t i o n l y administered s u b d i v i s i o n of farmland. pressures on land use, the area of the study w i l l be l o c a t e d , and c h a r a c t e r i z e d such that the seriousness of the problem can be brought i n t o proper p e r s p e c t i v e . The S e t t i n g P h y s i c a l D e s c r i p t i o n The Okanagan V a l l e y i s the common name f o r the Okanagan Trench which i s l o c a t e d i n the south c e n t r a l i n - t e r i o r of B r i t i s h Columbia, and i s a deep wide v a l l e y which d i s s e c t s the province's C e n t r a l I n t e r i o r P l a t e a u . The general area of t h i s study extends from Osoyoos at the I n t e r n a t i o n a l Boundary w i t h Washington State i n the south, to Salmon Arm i n the North (See Figure 1, THE OKANAGAN VALLEY OF BRITISH COLUMBIA, Pg. 4). The plat e a u i s bounded on the east and southwest by high mountain chains which range from upland h i l l s to gently s l o p i n g t e r r a c e s along the v a l l e y s i d e s . A chain of lakes and r i v e r s runs down the centre of the Okanagan V a l l e y . In the north the Shuswap Lake forms the v a l l e y ' s northern boundary. From here the Shuswap River flows southward i n t o the v a l l e y to j o i n w i t h Okanagan Lake. The lake d i v i d e s the v a l l e y f o r approximately s i x t y - f i v e m i l e s , u n t i l i t terminates at P e n t i c t o n . The Okanagan Ri v e r then j o i n s t h i s lake w i t h Skaha, Vaseux and Osoyoos Lakes before f l o w i n g i n t o Washington S t a t e . The v a l l e y v a r i e s i n width from three miles i n the southern mountainous areas to twelve miles i n the north. Figure I THE OKANAGAN VALLEY OF BRITISH COLUMBIA SOURCE: PRELIMINARY REPORT NO. A,*List of Okanagan Basin Study Report Publications'; Study Committee, CANADA, BRITISH COLUMBIA - OKANAGAN BASIN AGREEMENT , Penticton, B.C., 1972 , back cover. Along the main waterway of the v a l l e y are the communities of Kelowna and P e n t i c t o n . They serve as major s e r v i c e centres f o r the c e n t r a l and southern p o r t i o n s of the v a l l e y . Vernon i s l o c a t e d a few miles east of the Okanagan Lake i n the n o r t h , between Swan and Kalamalka Lakes. I t i s the major s e r v i c e centre f o r the North Okanagan V a l l e y . 5 The v a l l e y w a l l s r i s e s t e e p l y to about 3,500 to 4,00 0 f e e t above the scenic l a k e s . The Okanagan i s g e n e r a l l y noted f o r i t s hot dry summers. T h i s , coupled w i t h the obvious a v a i l a b i l i t y of water resources make the V a l l e y r i c h i n r e c r e a t i o n and a e s t h e t i c resources. The r e s i d e n t s them- selves place a high value on water-based r e c r e a t i o n a l a c t i v i t i e s i n the Okanagan B a s i n , where 92 percent of the r e s i d e n t s could go swimming and 7 4 percent boating w i t h i n 30 minutes of t h e i r homes.6 The s p e c i f i c l o c a t i o n of the case study i s on the west side of Skaha Lake, approximately s i x m i l e s from the c e n t r a l business d i s t r i c t of P e n t i c t o n . Before the 1958, c o n s t r u c t i o n of the Lakeshore Road, the i n h a b i t a n t s of the Ranch i n the case study t r a v e l l e d through Okanagan F a l l s and 5 B r i t i s h Columbia Land S e r v i c e , Department of Lands, Forests and Water Resources, "The Okanagan Area B u l l e t i n , 1968", V i c t o r i a , B.C., p. 2. 6Study Committee, Canada-British Columbia, Okanagan Basin Agreement, "Recreation and A e s t h e t i c Resources", P r e l i m i n a r y Study Data - B u l l e t i n No. 5, P e n t i c t o n , B.C., J u l y 15, 1972, P. 2. (Based on Survey of 384 Okanagan households). around the west side of Skaha Lake to reach the c i t y of Pe n t i c t o n (See Figure 2, "LOCATION OF THE CASE STUDY AREA IN THE OKANAGAN VALLEY", Pg. 7). The t e r r a i n of the case study, area i s spe c t a c u l a r w i t h e l e v a t i o n s v a r y i n g between 1110 fee t at Skaha Lake and 1800 f e e t at the top of the h i l l s . Areas not under the t r e e - f r u i t c u l t i v a t i o n are t y p i c a l of the Montane Forest Region of B r i t i s h Columbia, w i t h open.-grown, c l u s t e r stands 7 of Ponderosa Pine (Pinus ponderosa Laws.) i n . a p a r k l i k e s e t t i n g . Appendix A i s a st e r e o s c o p i c p a i r of a e r i a l photo- graphs of the case study area. These photographs i l l u s t r a t e g the t y p i c a l t e r r a i n encountered i n the. Skaha Lake area. The Economic Status of., the Okanagan V a l l e y The population of the Okanagan Basin increased by 38,500 between the years 1961 and 1971, to approximately 113,500. This was an increase of 51.3% as compared to a population growth of 34.1% f o r B r i t i s h Columbia as a whole. The growth, however d i d not take place at equal r a t e s throughout the v a l l e y . The population growth i n Kelowna was 83.3% between 1961 and 1971 reaching 46,700 i n tha t year. 7R. C. Hosie, Native Trees of Canada, Canadian F o r e s t r y S e r v i c e , Department of the Environment, Information Canada, Ottawa, Seventh E d i t i o n , 1973, p. 44. °B. C. Lands S e r v i c e ; Map Production D i v i s i o n Surveys and Mapping Branch, V i c t o r i a , B.C., A i r photographs Nos. BC4.143-094 and BC4143-095, 1963, f l i g h t l i n e . Figure 2 LOCATION OF THE CASE STUDY AREA IN THE OKANAGAN VALLEY SOURCE • Department of Energy , Mines , and Resources. Map, Penticton 82 E/5E Edition I , 1968 . Scale 1=50 ,000 . P e n t i c t o n area by c o n t r a s t grew at a more conservative r a t e of 32.3%, due l a r g e l y to expansion i n tourism, w i t h some manufacturing and s e r v i c e trades.^: Kelowna's growth, by c o n t r a s t , was due l a r g e l y to expansion of the W i n f i e l d d i s t i l l e r y , l o c a l w i n e r i e s , mobile homes and carpet manufac- . . 10 turxng. Data from an economic growth study c a r r i e d out under the Okanagan Basin Agreement gives i n s i g h t i n t o the changes which have taken place i n the Okanagan V a l l e y be- tween 1961 and 1971. The Federal Government's Regional Incentives Program was p r i m a r i l y r e s p o n s i b l e f o r the increase i n the non-resource based employment of 1,440 jobs i n the 10 year p e r i o d , a 200% increase i n t h a t time. Tourism showed a healthy 92.9% increase from 620 to.1,230 jobs over the same peri o d . The region as a whole had a net increase i n employ- ment of 9,86 0 jobs or 5 3.0% during the survey p e r i o d . 1 1 However a g r i c u l t u r e , p r i m a r i l y the t r e e f r u i t i n d u s t r y , had a net employment decrease of 250 jobs, which the study a t t r i b u t e d to a number of f a c t o r s . These i n c l u d e the l o s s of comparative advantage i n export markets, s u b d i v i s i o n of 9Study Committee, Canada - B r i t i s h Columbia Okanagan Basin Agreement, "Economic Growth i n the Okanagan Basin to 1980", P r e l i m i n a r y Study Data - B u l l e t i n No. 9, P e n t i c t o n , B.C. J u l y 15, 1972, p. 1. I b i d . p. 3. I b i d . p. 2. a g r i c u l t u r a l land f o r r e s i d e n t i a l and i n d u s t r i a l purposes and the increased p r o d u c t i v i t y per w o r k e r . 1 2 The d e c l i n e employment was probably a l s o due to the f a c t that the r e t i r i n g o r c h a r d i s t s ' l a n d was converted to urban uses r a t h e r than being taken over by new o r c h a r d i s t s e n t e r i n g the i n d u s t r y . This change i n r e l a t i v e importance of tourism i n the Okanagan Basin was i n f l u e n c e d no doubt by the improved access from A l b e r t a upon completion of the Roger's Pass highway i n the e a r l y 1960's. The p r o j e c t i o n f o r the tourism s e c t o r to increase by 770 jobs or 62.9% by 1980 i s an i n - crease at a slower pace than from 1961 to 1971. This r e - f l e c t s a l e v e l i n g o f f of the i n f l u e n c e of the highway and slower growth i n the demand f o r r e c r e a t i o n a l a c t i v i t i e s from B r i t i s h Columbia, A l b e r t a and Washington S t a t e . ^ The t o t a l estimated exiaenditures bv the 760.200 t o u r i s t s 1 4 to the Okanagan i n 1970 was between 25 to 30 • I T . n 15 mn±ion d o l l a r s . The region i s expected to have employment growth 1 2 I b i d . Table 1, p. 2. 13_. I b i d . 14_,., _. . , I b i d . Figure 3, p. 4. 1 5 S t u d y Committee, Canada - B r i t i s h Columbia, Okanagan Basin Agreement, "Recreation and A e s t h e t i c Resources", op. c i t . , p. 2. of 47.2% by 19 80 or 13,430 new j o b s . 1 6 Undoubtedly these p r o j e c t e d increases i n employment w i l l i n v o l v e expansions of e x i s t i n g i n d u s t r i e s and the emergence of new ones, a l l r e q u i r i n g a d d i t i o n a l land. The most obvious source of t h i s r e q u i r e d land would have been the f r u i t orchards p r i o r to the land freeze i n December of 1972. At the time of the Okanagan Basin Economic Growth Study, i t was p r e d i c t e d t h a t 5,270 acres of i r r i g a t e d acreage would be l o s t to other uses by 1980. Of t h i s 5,270 acres, approximately 800 acres of i r r i g a t e d t r e e f r u i t orchards would be l o s t i n the P e n t i c t o n a r e a . 1 ^ Although the farm land freeze w i l l l i k e l y prevent much of t h i s acreage from being l o s t to development, the pressure f o r change w i l l s t i l l be there, provided the economic p r e d i c t i o n s are reason- ably accurate. This changing economic environment along w i t h the d i s s a t i s f a c t i o n of many o r c h a r d i s t s w i t h t h e i r p l i g h t , provides an unusual s i t u a t i o n i n which to analyze the case study of land use change near P e n t i c t o n . x u S t u d y Committee, Canada - B r i t i s h Columbia, Okanagan Basin Agreement, "Economic Growth i n the Okanagan Basin to 1980", op. c i t . , Table 1, p. 2. I b i d . Figure 4, p. 4. CHAPTER I I THE TUMBLEMOON RANCH CASE STUDY The problem of orchard s u b d i v i s i o n was f i r s t brought to the a t t e n t i o n of Pro f e s s o r W. F. Smith by Mr. Harold Thomson, Planning D i r e c t o r of the Okanagan - Similkameen Regional D i s t r i c t , i n the sp r i n g of 1973. Mr. Thomson's primary concern was that orchard land was being subdivided more r a p i d l y than the market f o r f u l l y - s e r v i c e d l o t s d i c t a t e d . This demonstrated the l i q u i d i t y problems of the money-losing o r c h a r d i s t s . He was also concerned th a t the excessive s u b d i v i s i o n was i n the form of r e c r e a t i o n l o t s , which would e v e n t u a l l y become permanent r e s i d e n t i a l l o t s without the req u i r e d i n f r a - s t r u c t u r e necessary i n an urban community. The m u n i c i p a l i t y or the r e g i o n a l d i s t r i c t would then become re s p o n s i b l e f o r i t s p r o v i s i o n at a l a t e r date. ... The author and Professor Smith made a t r i p to P e n t i c t o n i n e a r l y June to see the concerned Planning D i r e c t o r . At the one hour meeting Mr. Thomson discussed 4-V, 4- * 1 A 4- 4 - 1 8 * 4-U ' * "4- • 4-U the concept of a land use c o n t r a c t and the use of i t i n t h Okanagan - Similkameen Regional D i s t r i c t . The land use cont r a c t was an attempt to regula t e s u b d i v i s i o n s to ensure th a t a l l the necessary i n f r a - s t r u c t u r e was provided by the developer. ^ M u n i c i p a l A c t ' R - S ' B - C : li§0' Chapter 225, Section /U2A, w i t h due regard f o r Se c t i o n 702 (2) and Se c t i o n 702A(1). Two such c o n t r a c t s had been approved by the Regional D i s t r i c t at the time of the meeting, and the P l a n n i n g D i r e c t o r suggested t h a t one of the h o l d e r s , an o r c h a r d i s t , might t a l k w i t h us on the s u b j e c t . Mr. Thomson contacted the o r c h a r d i s t who agreed to meet us t h a t same afte r n o o n . The c o n t a c t with Tumblemoon Ranch had been made. N e i t h e r P r o f e s s o r Smith nor the author a n t i c i p a t e d t h a t t h i s case of orchard s u b d i v i s i o n would become the s u b j e c t of i n t e n s e i n v e s t i g a t i o n , e s p e c i a l l y a f t e r our a f t e r - noon meeting with the owner and o p e r a t o r of Tumblemoon Ranch, who was understandably s k e p t i c a l 'of our. motives. The farm¬ lan d f r e e z e and the newly formed Land Commission, were s t i l l f r e quent news t o p i c s even i n June. The o r c h a r d i s t was a r e f r e s h i n g man of s i x t y - t h r e e , although years of o r c h a r d i n g i n the Okanagan sunshine made him look only 50. He had grown up i n England and came to Canada i n 1934. He then took a two year diploma course i n a g r i c u l t u r e at MacDonald C o l l e g e o f M c G i l l U n i v e r s i t y i n Ste. Anne de B e l l e v u e , Quebec. His a g r i c u l t u r a l background l e d him to the Okanagan V a l l e y , where he became a prominent 20 member of the t r e e f r u i t growers f r a t e r n i t y . The o r c h a r d i s t spoke s k i l f u l l y about the g e n e r a l 1 9 M a r j o r i e N i c h o l s , "Richmond lawyer appointed land commission chairman , The Vancouver Sun, (May 1/, 19/3), p. 1. 20, . . . , . . , * rp K I Interviews w i t h o r c h a r d i s t - owner and o p e r a t o r or lumniemoon Kancn, June 1/ to June ^y, i y / j ; ana J u l y ^/ to August 1, 197 3. problems w i t h the tre e f r u i t i n d u s t r y , the.economic s t a t u s of t h a t i n d u s t r y , h i s o p e r a t i o n , and vaguely about h i s past s u b d i v i s i o n s . A glimpse at h i s proposed s u b d i v i s i o n plan at the end of our inf o r m a l chat was the f i r s t i n d i c a t i o n that s p e c i f i c information concerning t h i s on-going p r o j e c t might be obtained. The duo then returned to Vancouver hope- f u l about the chances of developing the Tumblemoon Ranch^ 1 case i n t o a f u l l s c a l e i n v e s t i g a t i o n of an orchard sub- d i v i s i o n under a land use c o n t r a c t . The author returned on June 8 f o r a b r i e f t a l k w i t h the o r c h a r d i s t whereupon i t was agreed then t h a t another v i s i t a week l a t e r should l a s t two weeks or more, so that any study, i f there was one, would be a r e f l e c t i o n on a way of l i f e as w e l l as on a farm business. A f t e r the second day of t h i s two week s t r e t c h the o r c h a r d i s t suggested t h a t the author should only work the orchards i n the morning and evening, l e a v i n g the hot a f t e r - noons f o r research i n the ranch o f f i c e . I t was through the o r c h a r d i s t ' s kindness and co¬ ope r a t i o n , i n a l l o w i n g d e t a i l e d a n a l y s i s of personal papers and records, t h a t t h i s case study has economic v a l i d i t y . Discussions e x p l a i n i n g accounting methods i n the o r c h a r d i s t ' s 21„ The l o c a l name f o r the Ranch i s used, r a t h e r than the o r c h a r d i s t ' s name or l e g a l d e s c r i p t i o n of the property, s i n c e the s u b d i v i s i o n i s p r e s e n t l y being excavated; anonymity was promised throughout - such that r e a l data could be used. exact and d e t a i l e d r e c o r d s , which pre-dated Tumblemoon Ranch by a decade, took up many hours of h i s sc a r c e l e i s u r e time. The completeness of the data base of t h i s study f a r exceeded i n i t i a l e x p e c t a t i o n s . The Economic H i s t o r y of Tumblemoon Ranch, 1958-1972 The o r c h a r d i s t bought Tumblemoon Ranch i n 1946, i n p a r t n e r s h i p w i t h h i s b r o t h e r . By 1948, h i s b r o t h e r had decided t h a t o r c h a r d i n g was not f o r him and l e f t the business venture. The i n i t i a l purchase p r i c e was $50,000 f o r the 322 acre ranch. However, $25,000 was con s i d e r e d the c o s t f o r o r c h a r d i n g equipment and improvements, which i n c l u d e d $7,000 f o r the ranch house and sheds. The purchase p r i c e of the ranch, land and improvements was, t h e r e f o r e , $32,00 0 or $99.38/acre. 2 2 The ranch remained as a whole u n i t u n t i l 1964, when a s u b d i v i s i o n of f i v e l o t s was c a r r i e d out. A sub- sequent s u b d i v i s i o n and an ex t e n s i o n to i t o c c u r r e d i n 1971 encompassing s i x l o t s . Table 1 shows the t o t a l area s o l d from the ranch by 1972. These were the o n l y l a n d t r a n s - a c t i o n s i n v o l v i n g Tumblemoon Ranch p r i o r to 1972. However, records from 1946 to 195 8 i n c l u d e d another o r c h a r d o p e r a t i o n Since the r e c o r d s had no data r e f e r r i n g to the p r o p o r t i o n of ranch under c u l t i v a t i o n i n 1948, the 1973 orchard s i z e i s used throughout. T h e r e f o r e , purchase p r i c e / acre = $32,000/322 acres = $99.38/acre. LAND USE AND LAND USE CHANGES TUMBLEMOON RANCH, 19 46-1.97 3 Acres T o t a l Ranch S i z e (1946) 1964 S u b d i v i s i o n 322.00 Lots (No.) Acres i n l o t s Acres i n roads 5 17.66 1.40 a T o t a l Acres 19.06 To t a l Ranch S i z e (1973) 1971 S u b d i v i s i o n 5 3.58 4.27 7. 85 197 3 ORCHARD OPERATION Orchard Use: Apples: bearing 22.70 non-bearing A p r i c o t s : bearing 4.20 non-bearing Pears: bearing 9.60 non-bearing T o t a l Orchard Use Access Roads to Orchard T o t a l Non-orchard (Ponderosa Pine, Reservoir T o t a l Acres belonging to O r c h a r d i s t 1971 Extension 1 3.45 1.64 5.09 10.70 grass) 32.00 b 290.00 33. 40 4.20 9.60 47 .20 2.54 238.35 1.91 290.00 HRoads i n acres of 1964 s u b d i v i s i o n only 1.40 acres, s i n c e 3 of 5 l o t s were s e r v i c e d from Lakeside Rd. ^Acreage data d e r i v e d from the survey plans of each s u b d i v i s i o n from Land R e g i s t r y O f f i c e , Kamloops, B.C. SOURCE: Tumblemoon Ranch Records on the "Naramata Bench" 2 3, where the o r c h a r d i s t f i r s t s e t t l e d i n 1936. This property was s o l d i n e a r l y 1958, whereupon Tumblemoon Ranch became the so l e a g r i c u l t u r a l e n t e r p r i s e f o r the operator. The reasons behind the sale were q u i t e evident; the management of two seasonally labor i n t e n s i v e orchard operations i n an era of a d i m i n i s h i n g supply of q u a l i t y labor was a mammoth task. Therefore, t h i s case study w i l l d eal p r i m a r i l y w i t h the opera t i n g years of 195 8-1972, when Tumblemoon Ranch stood alone economically. .The Orchard Operations, 1958-1972 "An orchard i s an a g r i c u l t u r a l e n t e r p r i s e . I t s primary o b j e c t i v e i s p r o f i t through the pro-- ductio n and s a l e of f r u i t . In t h i s sense an orchard i s more than j u s t land, trees and f r u i t or a way of l i f e . I t i s a business which must balance the d e b i t s w i t h the c r e d i t s . " 2 4 Accepting Dr. Tukey 1s statement as v a l i d f o r the Okanagan area, the a n a l y s i s of the Tumblemoon Ranch opera- t i o n s became p r o f i t a b i l i t y o r i e n t e d . The data f o r t h i s s e c t i o n came p r i m a r i l y from the personal records of the o r c h a r d i s t . The operator of Tumblemoon Ranch, l i k e most t r e e - f r u i t growers i n the Okanagan V a l l e y , ran a one-man 2 3The "Naramata Bench" i s the l o c a l name f o r a low bench approximately 10 0 f e e t above the l e v e l of Okanagan Lake on i t s east s i d e . The bench f o l l o w s the shore from the P e n t i c t o n c i t y l i m i t s to Naramata (about 7 m i l e s ) . 2^R. B. Tukey, " I m p l i c a t i o n s of Economics on Orchard Management", Proceedings of the F i r s t BCFGA H o r t i - c u l t u r a l Conference, The 196 9 APPLE FORUM, (November 24, 25, 1969), P. 33. o p e r a t i o n , h i r i n g labor during h a r v e s t i n g and t h i n n i n g operations w h i l e he c a r r i e d out most of the other d u t i e s independently. The bulk of the crop was s o l d to a co- oper a t i v e packing house which marketed i t v i a the B r i t i s h Columbia Tree F r u i t s L t d . (B.C. Tree F r u i t s ) . This c e n t r a l s e l l i n g agency was authorized by the B r i t i s h Columbia F r u i t Board, pursuant to the Na t u r a l Products Marketing ( B r i t i s h Columbia) A c t , 2 5 and the A g r i c u l t u r a l Products Market Act of Canada. The returns to the o r c h a r d i s t are p r o p o r t i o n a l to the o v e r a l l market p r i c e of the grade of f r u i t which he supp l i e s and the c u l l r a t e s a p p l i c a b l e to h i s crop. D i s c u s s i o n of the marketing and p r i c i n g system of B. C. Tree F r u i t s L t d . w i l l be d e a l t w i t h l a t e r . At t h i s p o i n t i n the study the aim i s to f a c t u a l l y r e l a t e the owner- operator' s f i n a n c i a l experience since 1958. Appendix B, "TUMBLEMOON RANCH, INCOME STATEMENTS, 1958 to 1972" provides a comprehensive account of the p r o f i t - a b i l i t y of the ranch as a business e n t e r p r i s e . Figure 3, "TUMBLEMOON RANCH CROP RETURNS AND NET ORCHARD INCOME, 195 8 to 1972" provides a g r a p h i c a l p r e s e n t a t i o n of some of the data from Appendix B, and v i v i d l y shows t h a t , as a business, the orchard operation was an economic d i s a s t e r . 2 5 N a t u r a l Products Marketing ( B r i t i s h Columbia) Act, R.S.B.C. 1948, Chapter 200, s . l ; 1960 Chapter 263, s . l . 26. Lhapter A-/, s.Z, c . l (1st. Supp.) A g r i c u l t u r a l Products Marketing A c t , R. S. 1970, •/, , s . l . 00 Since an orchard represents a long term investment, an a p p r a i s a l of t h i s economic s i t u a t i o n must n e c e s s a r i l y have a long-run emphasis. The nature and occurrence of annual costs a l s o a f f e c t the p r o f i t a b i l i t y of the commercial t r e e - f r u i t orchard more severely than other a g r i c u l t u r a l and resource-based i n d u s t r i e s . I t i s t h e r e f o r e important t h a t costs be analyzed i n a manner s u i t a b l e f o r a p p r e c i a t i o n of both the long and the short-run.aspects of the business. Figure 3 shows net income both before and a f t e r d e p r e c i a t i o n expenses. P r i o r to a n a l y s i s of t h i s f i g u r e , the method of determining the d e p r e c i a t i o n expense should be explained. Table 2, "DEPRECIATION SCHEDULE - 1972", ex p l a i n s the d e r i v a t i o n of t h i s annual cost. As w e l l , i t c l a r i f i e s the nature of c a p i t a l expenditures on a t r e e - f r u i t farm. The rates a p p l i e d i n Table 2 were those allowed by the s t r a i g h t - l i n e d e p r e c i a t i o n method approved under the Income Tax A c t . 2 7 The d e p r e c i a t i o n expenses f o r the complete study p e r i o d were determined from the income tax returns of the o r c h a r d i s t - o p e r a t o r . In conjunction w i t h Figure 3, a s e r i e s of t a b l e s (Tables 3 through 6) have been prepared to show what has occurred over the 15 year study p e r i o d . These t a b l e s serve to supplement Figure 3 and give t o t a l costs and revenues of the orchard operation. However, they are not a s u b s t i t u t e Income Tax Act, R. S. 1952. Chapter 148 as amended i s repealed except P a r t IV; 1970-71-72, Chapter 63, s. 1. DEPRECIATION SCHEDULE - 197 2 Item Year Purchased Yr. Loading P l a t f o r m 1962 Fence 1963 Sprayer 1963 I r r i g a t i o n Equipment 1963 Cu l t i - h o e 1964 Miscellaneous Equipment 1964 I r r i g a t i o n . Equipment 1965 Rotovator 1965 S p r i n k l e r 1967 Sundry 1967 Power Pruning Equipment 1968 S p r i n k l e r 1968 Tractor 1969 Mower 1969 T i l l e r 1969 Pumphouse 1970 Pump 1970 I r r i g a t i o n Equipment 1970 Chain Saw 1970 Honda " T r a i l - B i k e " 1971 Cost Rate D e p r e c i a t i o n $ % $ 61.66 5 3.08 2 ,451.21 5 122 .56 2,675.00 10 267.50 1,225.60 10 122.56 789.00 10 78.90 204.64 10 20.46 165 .15 10 16.51 775.00 10 77.50 640.84 10 64.08 129.50 10 12 .95 1,010.12 10 101.01 207.76 10 20.78 4,850.00 15 727 .50 740.00 10 74.00 163.00 10 16.30 136.74 5 6.84 6,159.00 10 615.90 3,759.88 10 375.99 152.01 10 15.20 470.40 15 70.63 Tota] $2,810.25 SOURCE: Or c h a r d i s t ' s 1972 Income Tax Return and Tumblemoon Ranch Records. f o r the d e t a i l e d annual breakdown of costs and income i n Appendix B. Table 3, "TOTAL INCOME BY CROP YEAR COMPARED WITH INCOME BY TAXATION YEAR", shows the magnitude of "other ranch income" which was not p l o t t e d on Figure 3. Except f o r 1958, 1966 and 1971 when the o r c h a r d i s t was given government crop a s s i s t a n c e or apple s u b s i d i e s , these sources of revenue were very small r e l a t i v e to f r u i t s a l e s . The data i n Figure 3 i s a l l based on the t a x a t i o n year, the year ending December 31, since the only expense i n f o r m a t i o n a v a i l a b l e was f o r t h a t p e r i o d of time. However, column 1 of Table 3 presents the annual crop s a l e s data based on the crop year. A crop year i s defined as the year i n which the crop i s harvested. Examination of columns 1 and 2 show th a t there i s a s u b s t a n t i a l d i f f e r e n c e i n the revenue of f r u i t s a l e s , depending on whether the crop year or t a x a t i o n year i s used. Figure 4, "RETURNS - CROP YEAR COMPARED WITH TAXATION YEAR", shows the more moderate f l u c t u a t i o n s i n revenues when c a l c u l a t e d on the b a s i s of the t a x a t i o n year. The f l u c t u a t i o n s i n f r u i t s a l e s by crop year can be seen to vary between $4,865.86 i n 1965 to a high of $31,956.20 i n 1962. However, according to the t a x a t i o n year data, 1965 f r u i t s a l e s amounted to $8,989.08 and 1962 netted $25,777.56. The marketing system causes the returns of one crop year to be spread out • over the l a s t two months of t h a t year" and the f i r s t s i x to e i g h t months of the f o l l o w i n g year. Crop rebates r e c e i p t s which a d i u s t the o r c h a r d i s t ' s crop value TOTAL INCOME BY CROP YEAR COMPARED WITH INCOME BY TAXATION YEAR (1) (2) (3) (4) F r u i t Sales F r u i t Sales Other Ranch Income T o t a l Ranch Income Crop Yeara Taxation Year Taxation Year Taxation Year $ $ $_ $ 1958 13,871.26 20,146.30 3,143.05 23,289.35 1959 11,645.96 12,718.66 306.53 13,025.19 1960 23,363.98 14,168.47 270.94 14,439.41 1961 23,853.58 25,723.01 58.00 25,781.01 1962 31,956.20 25,777.56 114.00 25,891.56 1963 20,819.29 30,226.69 100.00 30,326.69 1964 18,320.44 18,644.11 100.00 18,744.11 1965 4,865.86 8,989.08 50.00 9,039.08 1966 29,134.37 15,983.09 4,334.00 20,317.09 1967 22,241.52 25,473.38 675.47 26,148.85 1968 27,244.50 26,233.83 426.50 ,26,660.33 1969 8,450.91 14,705.53 60.00 14,765.53 1970 21,598.17 10,332.68 10,332.68 1971 24,000.42 20,098.94 2,954.12 23,053.06 1972 17,521.51 25,795.41 25,795.41 TOTALS $ 298,887.97 $ 295,016.74 $ 12,592.61 $ 307,609.35 aCrop Year r e f e r s to crops grown i n one year. Returns from that crop overlap i n t o the next t a x a t i o n year. Therefore, r e c e i p t s i n any one t a x a t i o n year have p o r t i o n s of r e t u r n s from two crop years. SOURCE: Appendix B, "TUMBLEMOON RANCH, INCOME STATEMENTS, 1958 to 1972", and Crop Returns Ledger, Tumblemoon Ranch. \ 35 3 0 25 - to I . D o 2 0 CO X I o 10 3 o si I— _ Fruit Sales (Crop Year) Fruit Sales (Taxation Year) 1958 1959 I960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972" Year Figure 4 RETURNS - CROP YEAR COMPARED WITH TAXATION YEAR SOURCE: Appendix B, TUMBLEMOON RANCH, INCOME STATEMENTS, 1958 to 1972 OJ to the f i n a l average market p r i c e r e c e i ved by B. C. Tree F r u i t s L t d . , could a r r i v e as much as eighteen months a f t e r shipment of the crop. These are the primary reasons f o r the more moderate response to good and bad years when analysed by t a x a t i o n year. The s i n g l e major reason f o r the y e a r l y f l u c t u a t i o n i n crop returns has been the weather - p r i m a r i l y the winter extreme temperatures. Figure 5, "MINIMUM ANNUAL TEMPERATURES, PENTICTON AIRPORT 1958 to.1971", shows the extent of sub-zero weather over the 14 year p e r i o d . In c o n s t r u c t i n g the graph the minimum temperature of each year was recorded r a t h e r than the winter minimum. Comparing the periods of severe weather to Figure 4, the win t e r s of 1959 and 1969 correspond w i t h two of the three major years when crop returns f e l l d r a s t i - c a l l y . The other year, 1965, was c h a r a c t e r i z e d by a s p r i n g f r o s t i n l a t e A p r i l , of 25 d e g r e e s . 2 8 Obviously the weather at Tumblemoon Ranch g r e a t l y i n f l u e n c e s the gross income of the a g r i c u l t u r a l e n t e r p r i s e . The tons of f r u i t and the subsequent gross income of the ranch must be balanced against the costs of produc- t i o n . This way the e i g h t years of negative income a f t e r d e p r e c i a t i o n , shown on Figure 3 can be explained. Table 4, "ANNUAL EXPENSES BY EXPENSE CLASS, TUMBLEMOON RANCH, 1958 - 1972", c l a s s i f i e s the cost i n v o l v e d . The a c t u a l costs are B r i t i s h Columbia, Department of A g r i c u l t u r e , Climate of B r i t i s h Columbia, Queen's P r i n t e r , V i c t o r i a , B.C., 1965. 10 - JZ c 4) J= 0 i f to a> I-io ̂ a - 2 0 Source 1958 1959 I960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 Year Figure 5 MINIMUM ANNUAL TEMPERATURES , PENTICTON AIRPORT 1958 to 1971 British Columbia, Department of Agriculture , Climate of British Columbia Queens Printer, Victoria, B.C. , 1958 to 1971 ANNUAL EXPENSES BY EXPENSE CLASS TUMBLEMOON RANCH, 1958 - 1972 Overhead Costs Pre-harvest Costs D o l l a r s Harvest Costs Ext r a o r d i n a r y Costs 1958 2,722.03 8,010.73 10,896.51 1959 1,859.96 6,541.57 7 ,430.80 1960 3,125.84 6,672 .01 7,893.94 1961 3,283.11 8,028.72 10,303.63 535.25 1962 3,832.74 7,235.82 12,629.18 1963 3,495.57 6,858.65 8,897.63 — 1964 3,453.14 6,745.92 11,687.72 — 1965 2,623.79 4,715.81 5,409.69 1966 3,813.60 3,556.43 7,935.44 392.46 1967 5,353.19 4,615.32 11,306.74 1968 5,531.66 3,800.65 11,092.02 1969 3,381.27 1,885.91 46.38 1970 3,806.13 4,579.10 9,966.66 395.46 1971 9,502.73 5,907.18 14,186.71 156.76 1972 5,502.33 6,559.65 13,891.09 9,146.55 To t a l Annual Expenses 21,629.27 15,832.33 17,691.79 22,150.71 23,697.74 19,251.85 21,886.78 12,749.29 15,697.93 21,275.25 20,424.33 5,313.56 18.747.35 29,753.38 35,099.62 SOURCE: Appendix B, "TUMBLEMOON RANCH, INCOME STATEMENTS, 1958 to 1972"; format f o r expenses from: R.'b. Tukey, "I m p l i c a t i o n s of Economics on Orchard Management", Proceedings of the F i r s t BCFGA'Horticultural Conference, The 1969 APPLE FORUM, (November 24, 25, 1969), P e n t i c t o n , B. C , P. 37. to of l e s s importance than t h e i r nature and d i s t r i b u t i o n . Con- sequently the annual costs were broken down i n t o three major groups. These major costs groups were: overhead c o s t s , pre-harvest c o s t s , and harvest c o s t s . Another minor, group, e n t i t l e d e x t r a o r d i n a r y c o s t s , was used to account f o r o c c a s i o n a l expenses that d i d not f i t s t r i c t l y i n t o any of the three major c a t e g o r i e s . The major e x t r a o r d i n a r y expenses occurred i n the four years i n which t r e e s were replaced. These semi-overhead expenses were placed i n t h i s category since they occurred randomly r a t h e r than i n a r e g u l a r manner. The costs of r e - f u r b i s h i n g the orchard would seem to c o r r e - spond to the c a p i t a l costs of other businesses; however, these costs are not allowed to be depreciated, and are con- s i d e r e d a current expense. These c l a s s i f i c a t i o n s of costs were suggested by Dr. Tukey i n h i s paper presented to the B. C. F r u i t Growers A s s o c i a t i o n , H o r t i c u l t u r a l Conference i n 1969. 2 9 He c a t e g o r i z e d overhead costs as taxes and costs f o r i r r i g a t i o n water, i n t e r e s t and d e p r e c i a t i o n ; pre-harvest costs as the growing c o s t s , such as costs of r e p a i r s , f u e l , grease and o i l , i n t e r e s t on o p e r a t i n g c a p i t a l , i r r i g a t i n g , s p raying, mowing and the wages and b e n e f i t s i n c u r r e d i n the pruning and t h i n n i n g operations i n the orchard. The harvest costs were l a r g e l y the expense of p i c k i n g . In h i s 1965 study Dr. Tukey found t h a t the overhead 2 9Tukey, op. c i t . , p. 37. and pre-harvest costs were n e a r l y equal i n magnitude as c a t e g o r i e s , and were r e l a t i v e l y f i x e d . The harvest costs were the v a r i a b l e c o s t s . 3 0 Table 5, "DISTRIBUTION OF AVERAGE PRODUCTION COSTS BY EXPENSE CLASS, TUMBLEMOON RANCH COMPARED WITH WASHINGTON STATE", compares the f i f t e e n year average d i s t r i b u t i o n of costs on Tumblemoon Ranch to Tukey 1s study. In both cases, the overhead and the pre-harvest costs are approximately equal, with. Tumblemoon Ranch having 29.01% and 25.36% r e s p e c t i v e l y . Washington State had much higher average expenses i n both c l a s s e s w i t h 40% of the costs a r i s i n g i n overhead and 44% i n pre-harvest. I t i s i n t e r e s t i n g to compare the costs per bearing acre f o r each of these areas as i t i s t h i s data upon which the percentages i n Table 5 were based. In Washington State the average, cost of production per bearing acre was $750 i n 1965, whereas i n the same year i n the Okanagan (Tumblemoon Ranch) the cost was $426.33. The f i f t e e n year average cost per bearing acre at Tumblemoon Ranch was $617.30. 3 1 A great deal of the increase i n average cost between 1965 and the f i f t e e n year average was due to s u b s t a n t i a l cost increases 3 0 I b i d . p. 35. Since the a c t u a l number of acres i n orchard pro- duction i s not known f o r each year, the 1973 data which was de r i v e d from the 1969 Tree Census, B. C. Department of A g r i - c u l t u r e , w i l l be used (Table 1). The small amount of orchard s i z e decrease between 1965 and 1973 w i l l only make Tumblemoon Ranch costs s l i g h t l y higher. DISTRIBUTION OF AVERAGE PRODUCTION COSTS BY EXPENSE CLASS, TUMBLEMOON RANCH COMPARED WITH WASHINGTON STATE Per Cent Expense Class Overhead Pre-harvest Harvest E x t r a o r d i n a r y Tumblemoon Ranch a 29.01 25.36 42.48 3.15 Washington S t a t e b 40. 00 44.00 16. 00 Totals 100.00 100.00 a F i f t e e n year average. b1965 survey only. SOURCE: Appendix B, "TUMBLEMOON RANCH, INCOME STATEMENTS, 1958 to 1972" and R. B. Tukey, " I m p l i c a t i o n s of Economics on Orchard Management", Proceedings of the F i r s t BCFGA H o r t i c u l t u r a l Conference, The 1969 APPLE FORUM, (November 24, 25, 1969), P e n t i c t o n , B. C. P. 35. i n 1971 and 1972. In 1971, the average cost per bearing acre was $891.80 and $1038.63 i n 1972. 3 2 The higher p r o p o r t i o n of v a r i a b l e costs i n the Okanagan, as shown on Table 5, could r e f l e c t the r a p i d l y r i s i n g minimum wage and the extremely high l a b o r turnover i n t r e e - f r u i t growing areas. The owner-operator c a r r i e s out the m a j o r i t y of the pre-harvest operations independently to avoid some of problems of decreasing q u a l i t y of l a b o r . This s i t u a t i o n probably causes the d i f f e r e n t sources of cost i n f l u e n c e i n the pre-harvest and h a r v e s t i n g p o r t i o n of expenses. The overhead costs are i n f l u e n c e d most by i n t e r e s t expense on the c a p i t a l invested.. The lower d i s t r i b u t i o n of costs i n overhead at Tumblemoon as compared wi t h Washington State probably r e f l e c t s the lower age d i s t r i b u t i o n of the survey respondents i n Tukey's study. These Washington o r c h a r d i s t s would probably be more h e a v i l y mortgaged, and consequently would have a greater i n t e r e s t expense. The age d i f f e r e n t i a l would s t i l l apply i f the Washington Study i s compared w i t h Arendt's 1969-1970 study r a t h e r than j u s t Tumblemoon Ranch. The Arendt study r e v e a l s t h a t the average age of the 57 o r c h a r d i s t s was 48 years o l d , See Table 1, "LAND USE AND LAND USE CHANGES TUMBLEMOON RANCH, 194 6-1973" and Appendix B, "TUMBLEMOON RANCH, INCOME STATEMENTS, 195 8 to 1972. Both used to d e r i v e average cost per bearing acre. w i t h 54 percent being between the ages of 41 and 5 0 . 3 3 The t r e e - f r u i t i n d u s t r y i n the Okanagan l a c k s the economic s t a b i l i t y to encourage young people to stay w i t h the f a m i l y farm. T h i s i s r e f l e c t e d i n the i n c r e a s i n g average age of the o r c h a r d i s t s - new b l o o d does not enter the i n d u s t r y . Table 6, "NET INCOME BEFORE AND AFTER DEPRECIATION EXPENSE" combines d e p r e c i a t i o n expense w i t h Tables 3 and 4, so t h a t the r e a l economic s i t u a t i o n i s shown. F i g u r e 3, which graphs some o f the i n f o r m a t i o n from Table 6, r e v e a l s t h a t , a t b e s t , f r u i t growing on Tumblemoon Ranch i s a form of s u b s i s t e n c e farming. U n f o r t u n a t e l y , the primary o b j e c t i v e of an orchard as an a g r i c u l t u r a l e n t e r p r i s e has never r e a l l y been achieved at Tumblemoon Ra n c h . 3 4 P r o f i t through the s a l e of f r u i t has not been a r e g u l a r accomplishment, and the l a s t t h r e e years of the study were not encouraging f o r the o r c h a r d i s t - o p e r a t o r . The net l o s s a f t e r d e p r e c i a t i o n m 1972 amounted to $12,114.46, an unprecedented low i n i t s economic h i s t o r y . I t i s w i t h an a p p r e c i a t i o n of the economic f r u s t r a t i o n s or f r u i t farming on Tumblemoon Ranch t h a t a n a l y s i s of the e a r l y changes i n land use has been c a r r i e d out. Arendt, op. c i t . p. 3. 3 4 T u k e y , op. c i t . p. 33. NET INCOME BEFORE AND AFTER DEPRECIATION EXPENSE T o t a l Ranch Income $ B r i t i a n T o t a l Cash Expenses $ Net Income Before Depreciation $ 1958 23,289. 35 21,679. 27 1,660. 08 1959 13,025. 19 15,832. 33 -2,807. 14 1960 14,439. 41 17,691. 79 -3,252 . 38 1961 25,781. 01 22,150. 71 3,630. 30 1962 25,891. 56 23 ,697 . 74 2,193. 82 1963 30,326. 69 19,251. 85 11,074. 84 1964 18,744. 11 21,886. 78 -3,142. 67 1965 9,039. 08 12,749. 29 -3,710. 21 1966 20,317. 09 15,697. 93 4,619. 16 1967 26,148. 85 21,275. 25 4,873. 60 1968 26,660. 33 20 ,424. 33 56 a 6,236. 00 1969 14,765. 53 5,313. 9,451. 97 1970 10,332. 68 18,747. 35 -8,414. 67 1971 23,053. 06 29,753. 38 -6,700. 32 1972 27,795. 41 35,099. 62 -9,304. 21 Depreciation Expense $ 2,950.55 2,235.33 1,985.63 1,996.77 1,583.04 1,832.58 2,521.89 2,811.78 2,705.79 2,705.79 .2,778.90 2,167.23 2,806.28 2,879.50 2 ,810.25 Net Income A f t e r D e p r e c i a t i o n $ -1,290.47 -5,042.47 -5,238.01 1,633.53 610.78 9,242.26 -5,664.56 -6,521.99 1,913.37 2,167.81 3,457.10 7,284.74 -11,220.95 -9,579.82 -12,114.46 aYear of Management Contract w i t h Business A s s o c i a t e , due to t r i p to Great SOURCE: Appendix B, "TUMBLEMOON RANCH, INCOME STATEMENTS, 1958 to 1972" The E a r l y S u b d i v i s i o n Schemes The pressure f o r s u b d i v i s i o n of Tumblemoon Ranch began the same year t h a t a record crop i n tons of produce turned i n t o a $3,142.67 l o s s before d e p r e c i a t i o n (Table 6). Figure 6, "AVERAGE CROP RETURNS PER TON, BY CROP YEAR" i l l u s - t r a t e s t h i s phenomenon, which i s a f u n c t i o n mainly of q u a l i t y and aggregate supply of t r e e f r u i t . In the p r i c e e l a s t i c market associated w i t h h i s produce the o r c h a r d i s t s u f f e r s xn e x c e l l e n t crop years as w e l l as i n poor ones. I t was not s u r p r i s i n g , then, that the o r c h a r d i s t - operator s t a r t e d a f i v e l o t s u b d i v i s i o n i n e a r l y 1964. I n q u i r i e s i n t o the a v a i l a b i l i t y of h i s land f o r r e s i d e n t i a l use had begun i n l a t e 1958, w i t h the completion of the Lake- shore road from P e n t i c t o n to Okanagan F a l l s on the east side of Skaha Lake. The i n q u i r i e s had increased u n t i l the o r c h a r d i s t had two f i r m o f f e r s i n the summer of 1964. The s u b d i v i s i o n removed nea r l y twenty acres of land from the north-western extremity of the property, of which 17.66 acres were lots°and the remainder were roads (See Table 1, pg. 15). The s a l e of the 1964 s u b d i v i s i o n l o t s were spread out over a f i v e year p e r i o d w i t h the l a s t l o t being s o l d i n 1969. Table 7, "LOT SALES, 1964 and 1971 SUBDIVISIONS" W i l l i a m C. B l a n c h f i e l d and Jacob Oser, ECONOMICS, R e a l i t y Through Theory, (New York: Harcourt Brace Jovanovich, INC.) p. 109-112. Fruit Receipts Dollars / Ton Crop o o o 8 ? o 35 Table 7 "LOT SALES, 1964 AND 1971 SUBDIVISIONS" 1. 1964 S u b d i v i s i o n Year of Sale Lot No. Acres S e l l i n g P r i c e (SI $/Acre 1964 1 1.16 3000 2,586.24 1964 2 5.13 5000 974.66 1965 3 7.74 8000 1,033.59 1967 5 2.21 6000 2,714.93 1969 4 1.42 4750 3,345.07 Tot a l s 17 .66 26,750 2 . 1971 S u b d i v i s i o n 1971 2 0.534 4,500 8,426.97 1971 5 1.283 10,000 7 ,794 .23 1972 1 0.811 5,500 6,781.75 1972 3 0.472 . 3,750 7,944.92 1972 4 0.476 4,000 8,403.36 Tot a l s 3.576 27,750 3. 1971 S u b d i v i s i o n Extension 1972 1 3. 449 10,000 2,899.39 SOURCE: Lot Plans (B l u e p r i n t s ) from Land R e g i s t r y O f f i c e , Kamloops, B. C. f o r the l o t s i z e s and Tumblemoon Ranch Records f o r the s e l l i n g p r i c e s . provides e x p l i c i t data about the nature and market p r i c e s of the t r a n s a c t i o n s . The o r c h a r d i s t placed a great d e a l of value on the a e s t h e t i c s and l o c a t i o n of h i s l o t s from the beginning of h i s s u b d i v i s i o n a c t i v i t i e s . I t i s not s u r p r i s i n g then t h a t there i s . a considerable v a r i a t i o n i n s e l l i n g p r i c e per acre i n 1964. Lot #1 was a choice l o t w i t h moderate grade, and was immediately adjacent to the road f a c i n g the lake. I t s o l d f o r $2,586.24 per acre. Lot #2 contained a great d e a l of st e e p l y s l o p i n g land which would be of l i m i t e d value f o r improvements. Consequently the p r i c e was based p r i m a r i l y on the two acres of usable land. The increased s e l l i n g p r i c e from 1967 to 1969 r e f l e c t s the increased demand f o r the property outside the c i t y l i m i t s of P e n t i c t o n . The o r c h a r d i s t - o p e r a t o r i n q u i r e d of r e a l e s t a t e agents and other landowners as t o the market p r i c e of s i m i l a r land and then set h i s p r i c e s a c c o r d i n g l y . The 1971 s u b d i v i s i o n was a c o n t i n u a t i o n of the philosophy that the returns from the s u b d i v i s i o n were a source of operati n g c a p i t a l . Although not untrue, t h i s i s an o v e r s i m p l i f i c a t i o n of the s i t u a t i o n . Figure 7, "1971 SUBDIVISION - PLAN 21364" shows the b a s i c layout of the s u b d i v i s i o n . Lot 5 of t h i s sub- d i v i s i o n i s r e a d i l y v i s i b l e on Appendix A, "AERIAL PHOTO- GRAPHS OF CASE STUDY AREA" as the f l a t s p i t of land on the f i r s t h i l l behind the farm house, and i s t y p i c a l of the complete s u b d i v i s i o n . The apple and a p r i c o t trees i n the SOURCE; Reduced Plan 21364, LAND z - ^ ^ ^ REGISTRY OFFICE, KAMLOOPS , B.C. See Appendix • < . D , " l 9 7 3 - SUBDIVISION PLAN UNDER LAND USE CONTRACT;' for location on farm. orchard p o r t i o n of t h i s s u b d i v i s i o n were o l d and near the end of t h e i r bearing c y c l e . As w e l l , the trees were a v a r i e t y of " f u l l - s i z e d " t r e e s t h a t were i n c r e a s i n g l y un- economic to prune, spray, . t h i n and harvest because of t h e i r height above the ground. Therefore, r a t h e r than cut them down and r e p l a n t w i t h some dwarf v a r i e t y , the o r c h a r d i s t subdivided. Table 7, i s not evidence t h a t the o r c h a r d i s t made a considerable amount of money from h i s two s u b d i v i s i o n s . In f a c t , h i s net r e t u r n i n the form of disposable income was f a r below the l e v e l of gross r e c e i p t s f o r the property. Since d e t a i l e d records of the types and magnitude of expenses i n 1964 were not a v a i l a b l e , the 1971 s u b d i v i s i o n has been used to represent the t y p i c a l c o s t s and net returns to the or c h a r d i s t - o p e r a t o r . Table 8, " 1971 SUBDIVISION COSTS AND RETURNS" i s a s i m p l i f i e d p r e s e n t a t i o n of revenues and costs f o r the 1971 s u b d i v i s i o n . The o r c h a r d i s t - o p e r a t o r s 1 complicated ac- counting system was n e c e s s i t a t e d by the Farm C r e d i t Corporation's r e g u l a t i o n s about repayment of mortgage money ^ ^ ^ j 4. • - i ^ 36 when a p o r t i o n of the mortgaged property i s s o l d . As can be seen from Table 8, the o r c h a r d i s t - operator received a t o t a l . o f $5,970.97 of disposable income from the 1971 s u b d i v i s i o n ($1,500.00 cash dep o s i t plus 3 6Farm C r e d i t A c t . , R.S. 1959, c. 43, s . l ; 1970, CHAPTER F-2, s. 16-, (e) , ( i i ) . 19 71 SUBDIVISION COSTS AND RETURNS Income: Sale of f i v e l o t s : $27,750.00 Less cash deposite ( l o t 5) 1,500.00 $26,250.00 $27,750.00 Expenses: Moving Telephone Poles $ Land Surveying Welding R e l o c a t i o n of i r r i g a t i o n pipe Sand, g r a v e l road b u i l d i n g Legal Expenses _ Net S u b d i v i s i o n Return: 394.40 783.82 5.00 24.56 1,097.60 7 9 2 • 6 2 $ 3,098.00 $ 3 ' ° 9 8 - 0 0 $24,652 .00 a Deposit to Farm C r e d i t Corporation "Suspense" Account Reduction of P r i n c i p a l , Farm C r e d i t Corporation Mortgage Cash to Or c h a r d i s t $23,152.00 7 558 5 8 4'47p]97 $12,029.55 Held i n "Suspense Account" by Farm C r e d i t Corporation $11,122.45 Sir "Since the o r c h a r d i s t - o p e r a t o r has a mortgage under the Farm C r e d i t Corporation, s u b d i v i s i o n must be approved by the Corporation and income from t h a t s u b d i v i s i o n must be c o n t r o l l e d by i t through a "Farm C r e d i t Corporation Suspense Account". The balance held i n Suspense Account would be ap p l i e d to the p r i n c i p a l of the mortgage or future payments; by agreement between O r c h a r d i s t and the Corporation. SOURCE: TUMBLEMOON RANCH RECORDS, 1971 S u b d i v i s i o n Ledger Sheet. $4,470.97 from the Farm C r e d i t Corporation's Suspense Account). Although h i s indebtedness i s s u b s t a n t i a l l y -de- creased, the net disposable income i s hardly s i g n i f i c a n t i n l i g h t of the $9,579.82 operat i n g l o s s a f t e r d e p r e c i a t i o n 3 7 i n that year. However, on cl o s e examination of the 1971 Income Statement, a s i g n i f i c a n t increase i n overhead i n t e r e s t expense i s observed suggesting t h a t a p o r t i o n of the $11,122.45 held i n the suspense account by the Farm C r e d i t C o r p o r a t i o n 3 8 was used to pay i n t e r e s t expense on retirement of the $7,558.58 i n p r i n c i p a l on the mortgage. I f t h i s were the case, the $6,700.32 l o s s before d e p r e c i a t i o n would be ov e r - s t a t e d , t a k i n g i n t o account the income from the sub- d i v i s i o n . The net income from the s u b d i v i s i o n , plus i n t e r e s t expense from the suspense account would have given the o r c h a r d i s t - o p e r a t o r a net income on a l l h i s a c t i v i t i e s of $2,-3,000 before d e p r e c i a t i o n expense. The s u b d i v i s i o n extension i n 1972 which removed 39 _ another 5.09 acres from the Ranch was the l a s t p a r c e l of land which the Planning D i r e c t o r of the Okanagan-Similkameen Regional D i s t r i c t would allow to be removed from the farm without the use of a land use c o n t r a c t . Figure 8, "1971 3 7 A P P e n d i x B, 1971 Income Statement. 3 8Bottom of Table 8, pg. 39. 3 9 S e e Table 1, pg. 15. SUBDIVISION EXTENSION PLAN 23475", e s t a b l i s h e s the l o c a t i o n of the one l o t r e l a t i v e to the 1971 s u b d i v i s i o n . Thus, the piecemeal s u b d i v i s i o n of Tumblemoon Ranch was ended; however the o r c h a r d i s t proceeded immediately t h a t f a l l , to enter i n t o a land use c o n t r a c t w i t h the Okanagan-Similkameen Regional D i s t r i c t . The Land Use Contract - The December 1972 Scheme In 1971, the government replaced the development permit device w i t h the land use c o n t r a c t . This gave the land owner the r i g h t to develop under the e x i s t i n g zoning c l a s s i f i c a t i o n or the land use c o n t r a c t . The change i n the M u n i c i p a l Act provided i n the new Section 702A, allowed the m u n i c i p a l i t i e s and the r e g i o n a l d i s t r i c t s to move out of the law-making, r e g u l a t o r y , p o l i c y 41 power bundle of ground r u l e s i n t o the housekeeping powers". This i n theory allowed the m u n i c i p a l i t i e s t o r e q u i r e the developer to v i r t u a l l y do as they d i c t a t e d . The developer's only a l t e r n a t i v e would be to attempt to c a r r y out a p r o j e c t under the e x i s t i n g by-laws. The procedure which the attorney must go through to secure a land use c o n t r a c t f o r h i s c l i e n t i s uncomplicated, 40 K. C. Woodsworth, (Ed.), Land Use C o n t r o l , Course i n Continuing Legal Education, Centre f o r Continuing Education, U n i v e r s i t y of B r i t i s h Columbia, Vancouver, B.C. October 1972, p. 12. 4 1 I b i d . p. 13. Appendix D, "1973- SUBDIVISION PLAN UNDER LAND USE CONTRACT',' for location on farm. yet e s s e n t i a l . An a p p l i c a t i o n i s made f o r the proposed development, s t a t i n g the property i n v o l v e d , i t s present zoning and use, the change re q u i r e d and the reasons f o r the change. The a p p l i c a t i o n i s submitted together w i t h e s s e n t i a l plans and proof of a u t h o r i z a t i o n of the r e g i s t e r e d land owner. The a p p l i c a t i o n i s then r e f e r r e d to a committee f o r consid- e r a t i o n . In the case of Tumblemoon Ranch i t was the Board of the Regional D i s t r i c t of Okanagan-Similkameen. At t h i s p o i n t the board must pass a development area b y - l a w , 4 2 4 3 pursuant to the requirements of Section 702(a)(2) of the M u n i c i p a l Act. In t h i s development by-law the board d e s i g - nates the area i n which i t w i l l consider land use c o n t r a c t s . Thus f a r , the board has done nothing other than to i n d i c a t e to the p u b l i c t h a t i t w i l l consider an a p p l i - c a t i o n f o r a land use con t r a c t i n that area. Now the board or c o u n c i l and the a p p l i c a n t negotiate a d r a f t form of land use c o n t r a c t which is . submitted f o r m a l l y to the board f o r approval i n p r i n c i p l e , whereupon i t goes to a p u b l i c hearing. To be approved at t h i s hearing the changes i n d i c a t e d by the board and the p u b l i c must be incorporated i n t o the pl a n . I f there are s u b s t a n t i a l changes made to the i n i t i a l land use co n t r a c t a f t e r the p u b l i c hearing, e s p e c i a l l y i n the form of a higher and more i n t e n s i v e use another p u b l i c 4 2 I b i d . p. 43. 4 3 M u n i c i p a l Act, op. c i t . Section 702(a)(2). hearing i s r e q u i r e d . 4 4 A lower or l e s s intense use on the other hand would probably not r e q u i r e a new p u b l i c hearing, merely an amendment to the co n t r a c t as Mr. W. T. Lane s u g g e s t s . 4 5 Since l i t t l e i s known about i t s r a m i f i c a t i o n s , the land use con t r a c t i s an i n t e r e s t i n g and maybe fearsome land use c o n t r o l i n B r i t i s h Columbia. The technique i t s e l f i s i n n o v a t i v e , f l e x i b l e and a u n i f i e d approach which allows whole developments to be presented at one p u b l i c meeting. However, w i l l the m u n i c i p a l i t i e s and r e g i o n a l d i s t r i c t s use i t to advantage or w i l l they set t h e i r requirements beyond the reach of the average developer? These questions cannot be answered f o r the province as a whole, but w i l l depend on the decision-makers i n each area. These general i n t r o d u c t o r y remarks on the a p p l i - c a t i o n and nature of the land use con t r a c t serve as an i n t e r e s t i n g backdrop against which to analyze the Tumblemoon Ranch land use c o n t r a c t of December 22, 1972. In the s p r i n g of 1972 the Planning D i r e c t o r of the Okanagan-Similkameen Regional D i s t r i c t decided that no more development of Tumblemoon Ranch would be allowed i n the form of a s e r i e s of small s u b d i v i s i o n s . The o r c h a r d i s t - o p e r a t o r made a p p l i c a t i o n to the "Board of the Regional D i s t r i c t " to have the development by-law passed such th a t he might apply 4 4 I b i d . S e c tion 703(5). Woodsworth, op. c i t . p. 41. f o r a land use c o n t r a c t on Tumblemoon Ranch. Th i s was passed, and on September 14, 1972, the Board and the o r c h a r d i s t agreed on a d r a f t land use c o n t r a c t which c a l l e d f o r between 320-329 l o t s depending on allow- ances f o r the r e s e r v o i r . At a p u b l i c meeting l a t e r i n the f a l l , p r e s s u r e from the p u b l i c as w e l l as the P l a n n i n g D i r e c t o r , caused t h i s d r a f t to be m o d i f i e d to i n c l u d e only 162 l o t s . The fundamental land use c o n t r a c t which the o r c h a r d i s t and Regional D i s t r i c t entered i n t o on December 22, 1972 appears as Appendix C, "LAND USE CONTRACT". The s u b d i v i s i o n p l a n submitted to the P l a n n i n g D i r e c t o r to supplement the land use c o n t r a c t i s Appendix D, "1972 - SUBDIVISION PLAN UNDER LAND USE CONTRACT". These two documents p r o v i d e the b a s i c data on which development was planned. However, the complete p i c - t u re would not be c l e a r u n t i l the o r c h a r d i s t ' s plans f o r d i s p o s a l o f the p r o p e r t y are o u t l i n e d . In May 1972, the o r c h a r d i s t entered an o p t i o n to purchase agreement wi t h a V i c t o r i a developer. The o p t i o n gave the developer the r i g h t to purchase the land on or be f o r e J u l y 1, 1973 f o r $225,000. There was a down payment of $10 00 a t the time of s i g n i n g the agreement, and a f u r t h e r $10,000 payable w i t h i n the month. I f and when the developer e x e r c i s e d h i s o p t i o n another $6 4,000 would be p a i d the vendor pending t e r m i n a t i o n and completion of the s a l e . The balance of $150,000 was to be secured i n the form of a f i r s t mortgage on the vendor's l a n d , payable i n q u a r t e r l y i n s t a l l m e n t s o f $6,000.00, commencing the f i r s t day of the quarter next f o l l o w i n g the quarter i n which the purchase and s a l e of the vendor's land had been completed. The complete balance and outstanding i n t e r e s t at 9 1/2%. per annum compounded semi-annually would be payable on the f i r s t day of J u l y , 1978. The proposed development under the December 22, 1972 land use con t r a c t was to be c a r r i e d out i n four develop- ment stages as o u t l i n e d i n Schedule "B" of Appendix C. These four stages have been drawn on Appendix D, "1973 SUBDIVISION PLAN UNDER LAND USE CONTRACT". The acreage of l o t s , road allowances, open space and various other uses tab u l a t e d i n Table 9, "LAND AREA BY USAGE AND DEVELOPMENT CATEGORY - DECEMBER 1972 LAND USE CONTRACT".. / \ A Change i n P o l i t i c a l Power On August 30, 1972, the New Democratic Party under the l e a d e r s h i p of David B a r r e t t scored a resounding p o l i t i c a l v i c t o r y over the S o c i a l C r e d i t regime of W. A. C. Bennett i n B r i t i s h Columbia's P r o v i n c i a l E l e c t i o n . 4 6 The v i c t o r y was a s o l i d one, w i t h the NDP winning 38 seats i n the 55 seat "NDP sweeps to B. C. v i c t o r y , ends Bennett's 20 year r u l e " , The Globe and M a i l , Toronto, (August 31, 1972), p. 1. 4 7 K e n Romain " B a r r e t t goes F i s h i n g , Bennett set meeting to plan NDP takeover", The Globe and M a i l , Toronto, (September 1, 1972), p. 8. LAND AREA BY USAGE AND DEVELOPMENT CATEGORY - DECEMBER 197 2 LAND USE CONTRACT COMPLETE DEVELOPMENT No. Of Lots 162 Acres Area of Lots 149.91 Road Allowances 31.12 Open Space 86.17 Game Sanctuary 2 0.89 Lake 1.91 T o t a l 290.00 No. of Lots Area of Lots Road Allowances Open Space Game Sanctuary Lake To t a l s No. of Lots Area of Lots Road Allowances Open Space Game Sanctuary Lake To t a l s DEVELOPMENT CATEGORY STAGE 1 50 Acres 48.45 7.21 55. 66 STAGE 3 21 Acres 29. 06 7. 79 36. 55 20. 89 1. 91 96.20 STAGE 2 34 Acres 40. 51 8.63 45. 90 95. 04 STAGE 4 57 Acres 31.89 7.49 3.72 43.10 SOURCE: Appendix D, by Planimeter. The campaign of the NDP party promised changes i n land-use l e g i s l a t i o n . An NDP p l a t f o r m p u b l i c a t i o n e n t i t l e d : "NDP: A NEW DEAL f o r PEOPLE" issued during the August e l e c t i o n campaign s t a t e d the i n t e n t i o n s of the pa r t y : "An NDP government w i l l : - E s t a b l i s h a land-zoning program to set aside areas f o r a g r i c u l t u r a l production and to prevent such land from being subdivided f o r i n d u s t r i a l and r e s i d e n t i a l areas. - E s t a b l i s h a land bank t o purchase e x i s t i n g and rezoned a g r i c u l t u r a l land f o r lease to farmers on a long-term basis."48 With such i n d i c a t i o n s , as t h i s and reg u l a r pro- nouncements about the e v i l s of conversion of a g r i c u l t u r a l land i n the Lower Mainland of B r i t i s h Columbia to r e s i d e n t i a l and i n d u s t r i a l uses, i t was not s u r p r i s i n g t h a t the new cabinet passed an o r d e r - i n - c o u n c i l on December 21, 1972 p l a c i n g a moratorium on a l l d e c i s i o n s r e l a t i n g to s u b d i v i s i o n and rezonmg a p p l i c a t i o n s of farm lands. The moratorium was necessary according to the M i n i s t e r of A g r i c u l t u r e , Hon. David D. Stupich, pending the establishment of a farm land p r e s e r v a t i o n p o l i c y which would be the subject of l e g i s l a t i o n to be presented i n the next session of the L e g i s l a t u r e . On February 22, 1973, the NDP government introduced 4 8 A l l a n Fotheringham, "There's An Obvious Reluctance to Downgrade...", The Vancouver Sun, (March 14, 1973), p. 43. 4 9"FREEZE ON FUTURE FARM LAND SUBDIVISION", The B r i t i s h Columbia O r c h a r d i s t , (January 1973), V o l . 13, No. 2, p. 21. the Land Commission Act., more widely r e f e r r e d to as B i l l 4 2 . 5 0 The b i l l became one of the most h o t l y debated i s s u e s of the new government's f i r s t l e g i s l a t i v e s e s s i o n . The b i l l b l ' h d the v e h i c l e commission w i t h wide powers of de s i g n a t i o n and use or a l l land i n the p r o v i n c e . ^ Amendments to the Land Commission Act ( B i l l 42) were announced by the M i n i s t e r of A g r i c u l t u r e , David Stupich on March 14, 1973. 5 2 The amendments d e a l t p r i m a r i l y w i t h the areas of p u b l i c d i s c o n t e n t w i t h the b i l l and covered: (1) The r i g h t of appeal from d e c i s i o n s of the land commission; (2) C l a r i f i c a t i o n of the s e c t i o n empowering the commission to zone land i n t o four d i f f e r e n t c a t e g o r i e s ; (3) I n c l u s i o n of m u n i c i p a l i t i e s and r e g i o n a l d i s t r i c t s i n the zoning process; and (4) Denial of e x p r o p r i a t i o n r i g h t s f o r the commission. ~P ̂  ^ g ri^) t mn. 1 1 1 J"u. 3 1973 t h. sl t XJ I GU. t G ri ciri t G W 11 G Owsn si^nG cl th.G itictjor sGCtions of t h G Lcincl 5 0 M a r j o r i e N i c h o l s , "Grip sought on a l l l a n d " , The Vancouver Sun, (February 23, 1973), p. 1. named", 5 1"Land board The Vancouver Provinc e , (May 18, 1973), p. 1. 5 2 " F o u r Land Act Amendments Pledged", The Vancouver Sun, (March 15, 1973), p. 1. 5 3 I b i d . Commission Act i n t o Law. 5 4 I t should be noted that the a g r i c u l t u r a l land freeze e s t a b l i s h e d by o r d e r - i n - c o u n c i l of December 21, 1972 was the mechanism which.prevented the o r c h a r d i s t - o p e r a t o r of Tumblemoon Ranch from proceeding with, development of h i s land. Whether by coincidence or not the land use c o n t r a c t was approved the day a f t e r the a g r i c u l t u r a l land freeze on December 22, 1972. Consequently., . the o r c h a r d i s t was r e - qui r e d by law to seek f u r t h e r approval although the Planning D i r e c t o r and the Board of the Regional D i s t r i c t of Okanagan- Similkameen had already approved h i s c o n t r a c t . Between the time of the commencement of the a g r i - c u l t u r a l land freeze on December 21, 1972, and J u l y 3., 1973 when f u n c t i o n a l s e c t i o n s of the Land Commission Act were proclaimed as law, the Environment and Land Use Committee under the Department of M u n i c i p a l A f f a i r s had j u r i s d i c t i o n over the land freeze. There were three c l a s s i f i c a t i o n s of land that stood a chance of being exempted from the f r e e z e : "-Land on which a development had s u b s t a n t i a l l y commenced on December 21, 1972. -Land that i s c l e a r l y not s u i t a b l e f o r a g r i c u l t u r e . -Land t h a t , w h i l e a r a b l e , i s u n s u i t a b l e f o r permanent c u l t i v a t i o n due to i t s p r o x i m i t y to e x i s t i n q i n d u s t r i a l or r e s i d e n t i a l development or due to i t s minimal size."55 54A„ . . . . . . . „„ . . , , , M a r j o r i e N i c h o l s , Key se c t i o n s of land act o f f i c i a l l y put i n t o f o r c e " , The Vancouver Sun, (July 4, 1973) p. 1. 5 5 P e t e r Watts, "Land Act A n a l y s i s " , J o u r n a l of Commerce, (May. 8,. 1973), p. 8. The appeal procedure.of the Environment and Land Use Committee re q u i r e d t h a t the a p p l i c a t i o n under appeal be i n the form of a sworn statement. I t must f i r s t be given approval by the m u n i c i p a l i t y , , r e g i o n a l d i s t r i c t or Depart- ment of Highways, whichever the case, and then forwarded f o r appeal to V i c t o r i a . I t was t h i s procedure which the o r c h a r d i s t - o p e r a t o r of Tumblemoon Ranch began when i t became apparent t h a t he was one day short of having h i s land use c o n t r a c t accepted and r e g i s t e r e d against h i s p r o p e r t y . 5 6 He chose to base the appeal on the f i r s t two c l a s s i f i c a t i o n s under which the land freeze might be l i f t e d ; " s u b s t a n t i a l commencement" and "land u n s u i t a b l e f o r a g r i - c u l t u r e " . To s u b s t a n t i a t e h i s appeal, he had a s o i l ap- p r a i s a l on March 8, 1973. I t was performed by the Canada Department of A g r i c u l t u r e , which recommended t h a t a l l l a n d , except, the southern p o r t i o n of the Ranch where orchards now were i n existence should be released from the a g r i c u l t u r a l land c l a s s i f i c a t i o n . These orchards c o n s i s t e d of about seven tenths c l a s s 2. agrxcu I t u r a l l a n d 5 7 U three tenths c l a s s 6. Con¬ sequently of the approximately f o r t y acres, of orchard only 5 6 M u n i c i p a l A c t , op. c i t . S e c t i o n 702A(4). 5 7Canada Land Inventory S o i l C a p a b i l i t y Ratings f o r t r e e - f r u i t growing, from conversation w i t h o r c h a r d i s t , J u l y 30, 1973. 28 acres were deemed s u i t a b l e as a g r i c u l t u r a l l a n d . T h i s 28 acres was only 9.66% of the t o t a l area mentioned under the l a n d use c o n t r a c t . On May 15, 197 3, the o r c h a r d i s t wrote the P l a n n i n g D i r e c t o r o f the Okanagan-Similkameen Regional D i s t r i c t ac- c e p t i n g the f a c t t h a t a p o r t i o n of the land (2 8 acres) was capable o f a g r i c u l t u r a l use under the d e f i n i t i o n of the Environment and Land Use A c t . 5 8 He asked t h a t the land use c o n t r a c t be amended to exclude t h i s farm lan d from the sub- d i v i s i o n . T h i s amendment was passed by the board o f Regional Y)' t ' c t on May 1*7 19 Y 3 In a c t u a l f a c t ths boaxrd irsroovsd 38 96 3.cx"GS f3rom ths s u b d i v i s i o n p l a n Thsss 39 acirss rs-™ mo vsd 59 piropo ssd l o t s i t s s f irom ths dsvslopmsnt. T a b l s 10 r 11 LAND AREA BY USAGE AND DEVELOPMENT CATEGORY ~~ APRIL 19"73 LAND USE CONTRACT" shows ths changss which ths amsndmsnt to ths land uss c o n t r a c t h e l d mads on ths dsvslopmsnt stacjss as compairsd w i t h TabIs 9 Ths 1 and irsmo vsd bsc9.ij.ss o f ths acjiri~ c u l t u r a l l a n d firsszs and ths psnding l s g i s l a t i o n i n ths f oirm £ ths Land Coiniuission A c t has bssn c a l 1 s d " F airmland RsSBTVS 11 T h i s amsndsd c o n t r a c t was submittsd to ths Dspart"~ "t f " " 1 r~ g JVlcL^^ 2 4 "tti3? 1 a.n n i n i t.̂5 y d ' sd b s t a f f o f ths dspa.irtnisnt t h a t thsy would r s c ~ d " t th. ms ncl s d. 1 an d. u. s s ĉ ) n t r a c t g i "V i n g n o Watts, op. c i t . ; Land wi t h c l a s s e s 1-4 of the c l a s s i f i c a t i o n o f s o i l c a p a b i l i t y f o r a g r i c u l t u r e , Canada Land Inventory (ARDA). LAND AREA BY USAGE AND DEVELOPMENT CATEGORY -APRIL 197 3 LAND USE CONTRACT COMPLETE DEVELOPMENT No. of Lots 103 Acres Area of Lots 115.94 Road Allowances 2 6.13 Open Space 86.17 Farmland Reserve 3 8.96 Game Sanctuary 2 0.89 Lake 1.91 T o t a l 290.00 DEVELOPMENT CATEGORY No. of Lots Area of Lots Road Allowances Open Space Farmland Reserve Game Sanctuary Lake To t a l s No. of Lots Area of Lots Road Allowances Open Space Farmland Reserve Game Sanctuary Lake To t a l s STAGE 1 49 Acres 46.75 7.21 1.70 55.66 STAGE 3 17 Acres 25.59 7.79 36.55 3.47 20. 89 1.91 STAGE 2 34 Acres 4 0. 51 8.63 45. 90 95. 04 STAGE 4 3 Acres 3. 09 2.50 3.72 . 33.79 96.20 43.10 SOURCE: Appendix D, by Planimeter. reasons. The Planning D i r e c t o r advised the o r c h a r d i s t that there should be an appeal to the Environment and Land Use Committee. This procedure was c a r r i e d out and the appeal was scheduled f o r the end of J u l y . However, i n the i n t e r i m , the o p t i o n to purchase arrangement w i t h the developer had expired. Understandably, si n c e the developer had l o s t s u f f i c i e n t funds i n the "sub- s t a n t i a l commencement", when he had financed the surveying and planning of the s u b d i v i s i o n , which cost n e a r l y $15,000, to e x e r c i s e the optio n pending the outcome of the appeal became too r i s k y an endeavour. Consequently, the o r c h a r d i s t extended the deadline of the optio n to October 31, 197 3, w h i l e changing the p r i c e from $225,000 to $3,000 per l o t rezoned or $309,000. 5 9 The amended land use c o n t r a c t was approved f o r 10 3 l o t s by the Environment and Land Use Committee the f i r s t week of August. The option was e x e r c i s e d and the o r c h a r d i s t l e f t the Ranch a f t e r the 1973 crop was harvested i n 61 November. I t i s i r o n i c a l t h a t the o r c h a r d i s t , who n e a r l y l o s t a l l the c a p i t a l gain on h i s property because of the a g r i c u l - 5 9Correspondence w i t h O r c h a r d i s t , September 20, 1973. I b i d . ^Correspondence w i t h O r c h a r d i s t , December 20, t u r a l land freeze and the subsequent Land Commission A c t , should acquire an a d d i t i o n a l $84,000 because of i t . How- ever, t h i s was p r e d i c t a b l e , as Ralph C a r l e of Western Realty P r o j e c t s L t d . i s quoted i n the Vancouver Sun: "The mortgage holder on a frozen property has the same r i s k as the landowner. There are two p o t e n t i a l l o s e r s . The s i t u a t i o n i n v i t e s d e f a u l t s of mortgage payments i n areas t h a t were expected to develop, and where only a small down payment was r e c e i v e d by the farmer. For sure the buyer i s going to walk away. Most of these buyers were s i n g l e purpose companies. But f o r those w i t h s t a y i n g power,'who are lucky enough to end up w i t h the leopard spots where the government i s forced to allow some development, the lands w i l l show a f a n t a s t i c appreciation."62 The " s t a y i n g power" of the owner of Tumblemoon Ranch not only netted him and h i s w i f e a d d i t i o n a l c a p i t a l g a i n , i t allowed t h e i r retirement. W i l l other o r c h a r d i s t s be so lucky? W i l l the new land use c o n t r o l s tend to force the uneconomical o r c h a r d i s t s to remain i n the i n d u s t r y ? What a l t e r n a t i v e s are a v a i l a b l e to o r c h a r d i s t s ? 6 2 R i c h a r d Dolman, "Questions sprawl over land f r e e z e " , The Vancouver Sun, (March 3, 1973), p. 32. CHAPTER I I I FORCES INFLUENCING LAND USE CHANGE WITHIN THE TREE FRUIT INDUSTRY The t r e e f r u i t i n d u s t r y of the Okanagan V a l l e y of B r i t i s h Columbia accounted f o r approximately 19 percent of the p r o v i n c i a l a g r i c u l t u r a l production i n 1970. In the years 1969 and 1970, B r i t i s h Columbia produced 24 and 39 percent r e s p e c t i v e l y , of the t o t a l value of t r e e f r u i t pro- 64 duction i n Canada. Of the 35,000 acres occupied by t r e e f r u i t production i n B r i t i s h Columbia, 32,000 acres are i n the Okanagan V a l l e y . Consequently, the magnitude and im- portance of the t r e e f r u i t i n d u s t r y of the Okanagan V a l l e y to B r i t i s h Columbia and the n a t i o n a l economy i s obvious. Yet, the t r e e - f r u i t i n d u s t r y i n the Okanagan V a l l e y i s dying. The problem of an uneconomical i n d u s t r y i s not a new circumstance f o r f r u i t growers. Mr. H. C o r b i s h l e y g i v i n g evidence at f i r s t meeting of the Royal Commission on the T r e e - f r u i t Industry of B r i t i s h Columbia, January 30th, 1957, st a t e d : "Fundamentally, there i s only one reason why we growers want a Royal Commission, and th a t i s the i n d i s p u t a b l e f a c t t h a t i n the midst of a 6 3CENSUS OF CANADA, 1971,. A g r i c u l t u r e B r i t i s h Columbia. S t a t i s t i c s Canada: Table 21. 6 4 S t a t i s t i c s Canada, Qua r t e r l y B u l l e t i n of A g r i c u l t u r a l S t a t i s t i c s , October - December, 1971. booming economy, we are not a f r a i d to admit we are going broke... Regardless of our acreage, or regar d l e s s of our a b i l i t y as o r c h a r d i s t s , we are l o s i n g money... "^5 The s i t u a t i o n has not changed appreciably since 1957. The 1969-70 marketing season y i e l d e d the grower an average of two cents a pound f o r apples t h a t the r e t a i l e r was s e l l i n g f o r 15 cents a pound. 6 6 The production costs f o r t h i s same pe r i o d were approximately $1.60 per box of a p p l e s 6 7 , or 3.81 cents per pound. Many people blame the c e n t r a l s e l l i n g agency, B. C. Tree F r u i t s L t d . However, i f t h i s agency were to ignore out- s i d e competition, e s p e c i a l l y when these areas have a d e f i n i t e comparative advantage i n the market, and p r i c e on a cost plus p r o f i t margin b a s i s , i t would be l e f t w i t h surplus f r u i t at the end of each season. I t i s i r o n i c a l t h a t the Report of the Federal Task Force on A g r i c u l t u r e , Canadian A g r i c u l t u r e i n the Seventies, c i t e s the B. C. Tree F r u i t s L t d . f o r e x c e l l e n t export market 6 5Dean E. D. MacPhee, The Report of the Royal Commission on the T r e e - f r u i t Industry of B r i t i s h Columbia, V i c t o r i a : Queen's P r i n t e r , 1958. p. 9. 6 6 , , P r i c e Gap Almost I n c r e d i b l e " , The B r i t i s h Columbia O r c h a r d i s t , (August 1970), V o l . 10, No. 11, p. 4 (bottom). "The Industry Needs A L i f e b e l t " , The B r i t i s h Columbia O r c h a r d i s t , (August 1970), V o l . 10, No. 11, p. 4 (top). 842 pounds of apples per box. development and an e x c e l l e n t s e l l i n g j o b . 6 9 I t i s r a t h e r unfortunate t h a t even t h i s p r o g r e s s i v e o r g a n i z a t i o n i s unable to provide more than marginal returns to the o r c h a r d i s t . This s e l l i n g agency and the grower a s s o c i a t i o n counterpart are much envied across the country. The t r e e - f r u i t i n d u s t r y i n the Okanagan i s being modernized as speedily.as finances and t r e e growth a l l o w . The packinghouses r a t e w i t h the best anywhere. Yet the man who c a r r i e s t h i s s t r u c t u r e on h i s , , 7 0 shoulders i s going broke. The B r i t i s h Columbia F r u i t Growers' A s s o c i a t i o n BCFGA) i n . r e a l i z a t i o n t h a t the income l e v e l of i t s members was c o n t i n u a l l y d e c l i n i n g , presented a b r i e f to the M i n i s t e r of A g r i c u l t u r e , Mr. David Stupich on May 8, 1973. The prob- lem which the b r i e f confronts cannot be more c l e a r l y s t a t e d than by a grower who s a i d "Our problem i s t h a t we are a 71 $2.00 i n d u s t r y i n a $5.00 economy." The b r i e f was submitted a f t e r the NDP government e s t a b l i s h e d the land freeze on a l l a g r i c u l t u r a l land. Since the BCFGA f e l t t hat t h i s was a p o s i t i v e i n d i c a t i o n t h a t the 6 9 R e p o r t of the Federal Task Force on A g r i c u l t u r e , Canadian A g r i c u l t u r e i n the Seventies, Information Canada, Ottawa, December 1969, p. 229. : 7 0 " P r i c e Gap Almost I n c r e d i b l e " , op. c i t . The B r i t i s h Columbia F r u i t Growers A s s o c i a t i o n , "Income Requirement Proposals f o r the Tree F r u i t Industry i n B r i t i s h Columbia," B r i e f to Honourable David D. S t u p i c h , M i n i s t e r of A g r i c u l t u r e , Kelowna, B. C. May 8, 1973, p. 1. government wanted to help r e t a i n a v i a b l e f r u i t i n d u s t r y , the primary problem of the low income of the o r c h a r d i s t needed to be r e c t i f i e d . To a l l e v i a t e t h i s problem the BCFGA made se v e r a l proposals to the p r o v i n c i a l government. A guaranteed p r i c e on the top grades of apples (Extra Fancy and Fancy) was suggested by the M i n i s t e r of A g r i c u l t u r e p r i o r to the b r i e f , and probably was the "germ" of the ide a f o r the a s s o c i a t i o n ' s proposal t h a t 12 cents a pound be p a i d f o r a l l v a r i e t i e s of apples i n these two grades. This would be a 35 percent increase (approximately) over the average market l e v e l i n 1971. The average of 12 cents per pound, by i n d u s t r y concensus, r e f l e c t s the cost of pro- duction of apples. In order to f o s t e r s t a b i l i t y i n the t r e e - f r u i t i n d u s t r y the BCFGA suggested that the crop insurance scheme be expanded to inc l u d e income. The income insurance would be t i e d i n w i t h the cost of production and would be operated as one scheme. The scheme would compensate the o r c h a r d i s t w i t h high y i e l d per acre since i t would be based on pro- d u c t i o n , not acreage. One of the major c a p i t a l expenditures which the o r c h a r d i s t must endure i s the i r r i g a t i o n system. However, there i s wide d i s p a r i t y i n i r r i g a t i o n and land tax ra t e s i n the Okanagan V a l l e y . This places an unequal burden on d i f f e r e n t growers. Consequently, the BCFGA proposed t h a t the NDP Government take over the r e s p o n s i b i l i t y f o r a l l i r r i g a t i o n d i s t r i c t s i n the Province and declare them a P r o v i n c i a l resource. In t h i s way the Government could adjust the water taxes to e q u i t a b l y r e f l e c t the b e n e f i t d e r i v e d by every segment of the community. 7 2 The t r e e - f r u i t i n d u s t r y of B r i t i s h Columbia i s s t i l l i n economic d i f f i c u l t y , s i x t e e n years a f t e r the MacPhee R e p o r t 7 3 exposed the i l l s of i t s operations. In s p i t e of paying substandard wages and s a l a r i e s , f r u i t growing has been a ho l d i n g use f o r land i n the Okanagan V a l l e y . With the Land Commission Act severely r e s t r i c t i n g conversion of orchard land to higher and more economic uses, the orchards w i l l have to be s u b s i d i z e d to become economically v i a b l e u n i t s . Why must the t r e e f r u i t i n d u s t r y be s u b s i d i z e d and what has occurred over the years to create the s i t u a t i o n ? The forces that i n f l u e n c e the economic v i a b i l i t y of the t r e e - f r u i t i n d u s t r y must be examined so that an under- standing of t h e i r c o m p l e x i t i e s , and t h e i r e f f e c t s on the Okanagan V a l l e y t r e e - f r u i t can be understood. N a t i o n a l and I n t e r n a t i o n a l Problems U n t i l r e c e n t l y , Western Europe served as a most v i a b l e market f o r Canadian and United States apple exports. But Europe's production has increased d r a m a t i c a l l y and i t i s 7 2 I b i d . p. 2. 7 3MacPhee, op. c i t . p. 765-804. r a p i d l y approaching a high degree of s e l f - s u f f i c i e n c y . 7 4 However, Europe i s only an example of a l a r g e r trend i n World production. The world-wide production i n 196 7 was 984 m i l l i o n bushels, a g a i n of 270 m i l l i o n bushels over the average of the second h a l f of the 1950's (1956-1959)'.75 This represented a 38 percent increase i n a decade. A b r i e f review of the increases i n apple production i n the major producing regions of the world q u i c k l y r e v e a l s the extent of a d i m i n i s h i n g export market f o r Canada and the United S t a t e s . Mr. S i n d e l a r described the growth of world apple production i n the f o l l o w i n g manner: "In terms of the average production during the four-year p e r i o d , 1956-59, the 1967 crop i n Europe was up, i n t o t a l , by 4 0 percent. In South America, where Argentina and C h i l e are the p r i n c i p a l producers the 1967 crop was up 27 per- cent; i n A s i a , i t was up 87 percent r e f l e c t i n g mainly production from Japan and Mainland China; i n A f r i c a , the crop was up 110 percent almost e x c l u s i v e l y the Republic of South A f r i c a ; and i n the Oceania Area, which represents mostly A u s t r a l i a and New Zealand, the 1967 crop was, i n t o t a l , up 50 percent. The region of North America - which i n c l u d e s United S t a t e s , Canada and Mexico - was up only 4 percent."76 The 1969 crop data was a v a i l a b l e f o r Europe and since the North American producers formerly s u p p l i e d t h i s 74 G i l b e r t E. S i n d e l a r , "The R i s i n g Level of World Apple Production," The B r i t i s h Columbia O r c h a r d i s t , (January 1970), V o l . 10, No. 4, p. 30. 7 5 I b i d . 6 I b i d . export market, i t s production increase s u r e l y must be des- c r i b e d as "breath-taking". Comparing the production to r e s p e c t i v e averages f o r 1956-1959, Belgium - Luxembourg production rose 77 percent; West Germany by 58 percent; Netherlands, up 61 percent; I t a l y , up 22 percent; Spain up 1 64 percent; Greece, up 104 percent, Yugoslavia up 79 percent; and France up an a s t o n i s h i n g 400 percent. Consequently, France has emerged as an e x p o r t i n g n a t i o n i n the years since 1965. S i x t y - t h r e e percent of the French apple crop was i n the Golden D e l i c i o u s v a r i e t y - 46 m i l l i o n bushels compared to United States production of 15 m i l l i o n bushels of t h i s v a r i e t y i n the same year. The two l a r g e s t apple importing nations i n the world, West Germany and the United Kingdom, have become the main t a r g e t of France's exports. West Germany, the l a r g e s t of these two importers, i n recent years imported between 2 4 to 29 m i l l i o n bushels of apples annually, of which about 18 to 24 m i l l i o n bushels came from North America. In the e a r l y 196 0's France commanded l e s s than one percent of the West German market, however i t was estimated t h a t i n 1968-1969 she exported 11.4 m i l l i o n bushels to West Germany or 47% of t h e i r i m p o r t s . 7 7 In t h i s same year, France exported s l i g h t l y more than 19 m i l l i o n bushels. This volume was 11 times greater I b i d . p. 31. than f i v e years e a r l i e r . However, e q u a l l y d i s c o n c e r t i n g f o r the B r i t i s h Columbia Industry was the a r r i v a l of 21 carloads o f French Golden D e l i c i o u s apples i n Montreal i n the f a l l of 1969. 7 8 The movement of France i n t o the home markets of an exporting n a t i o n was a p a r t i c u l a r l y b i t t e r p i l l f o r B r i t i s h Columbia to accept, even though the United States had always captured a p o r t i o n of t h i s market. With world production showing marked i n c r e a s e s , and export market a t t r a c t i n g i n c r e a s i n g l y more competition, the 79 Canadian export p i c t u r e does not look good. I t may be d i f f i c u l t f o r Canada to continue e x p o r t i n g the usual 3 m i l l i o n bushels a year. In 1969, B r i t i s h Columbia produced 5.66 m i l l i o n bushels of apples o f which 34.2 percent were exported. This i s approximately 1.94 m i l l i o n bushels of export apples or 65% of the Canadian export m a r k e t . 8 0 Consequently, i f a world surplus of apples causes Canada to lose a p o r t i o n of i t s export market, the B r i t i s h Columbia o r c h a r d i s t w i l l f e e l the e f f e c t s much more than growers i n any other p a r t of the country. I b i d . p. 32. 7 9 J . R. Burns, "The Canadian Apple Industry", Canadian Farm Economics, (December 1969), V o l . 4, No. 5, p. 17. 80 3 I b i d . Table 7, p. 12. Canadian consumption p r o j e c t i o n s f o r apples to 19 80 i n d i c a t e s an increase of 15 percent to 46 pounds per c a p i t a . 8 1 The s i x pound increase over the 1964-65 data, t s a 0 5 pound increase i n f r e s h consumption and a 5 5 ound increase i n processed apples The average population i n 1964-65 was 19.6 m i l l i o n persons compared to an estimate 26 m i l l i o n f o r 1980. Ap- p l y i n g the 46 - pound bushel to t h i s p o p ulation l e v e l , and h o p e f u l l y m a intaining the present 3 m i l l i o n bushels of 82 export Canada might be able to market 30 m i l l i o n bushels. However at the present time, growers should be prepared to face l a r g e increases i n pro d u c t i o n , since the p o t e n t i a l y i e l d s coupled w i t h a good growing season across the n a t i o n could r e s u l t i n an apple crop of about 31 m i l l i o n bushels before 1980. With such a p o t e n t i a l supply and l i t t l e prospect of i n c r e a s i n g demand, no f u r t h e r p l a n t i n g s should take p l a c e , other than p l a n t i n g s to maintain a l e v e l . .of production or to change v a r i e t i e s i n response to consumer preference. The orchards of tomorrow should be designed w i t h the prospect of surplus world supply, e s p e c i a l l y when i n t e r n a l growth i n the 8 1 I b i d . p. 17. Burns, op. c i t . 8 3 • • "Federal Economists Warn of Over-Production i n B r i 10, No. 9, p. 4. F r u i t s " , The B r i t i s h Columbia O r c h a r d i s t , (June 1970), V o l , i n d u s t r y should exceed the po p u l a t i o n growth and per c a p i t a demand. 8 4 A more immediate problem f o r the Okanagan f r u i t farmer i s the competition from American producers. The Federal Task Force on A g r i c u l t u r e i n 1969, was quick to i d e n t i f y the problem: "The Canadian harvest i s very much l i m i t e d to the June-October p e r i o d and the i n d u s t r y i s i n competition w i t h American f r u i t s and vegetables harvested over a much longer season. The e a r l i e r United States product s o l d i n Canada br i n g s higher p r i c e s to American farmers and takes the edge o f f Canadian Consumer a p p e t i t e s . I t i s common f o r the e a r l y harvest season of a Canadian crop to c o i n c i d e w i t h mid-season or even end-of-season h a r v e s t i n g i n the United States."85 The Washington f r u i t producers cause B. C. Tree F r u i t s L t d . to lower t h e i r p r i c e s by s e l l i n g below production cost to maintain t h e i r e a r l i e r p o r t i o n of the market, a v a i l - able to them due to the longer growing season. This t a c t i c was evident during the summer of 1973, causing some d i s s i d e n t cherry growers by-passed the c e n t r a l s e l l i n g agency, B. C. 86 Tree F r u i t s i n an attempt to recover t h e i r production c o s t s . T1 r " l ^ "F̂ f̂ Ĉ  T* 1 C~5C)\Tf-1 r r i T f i p T"l t 1 T T i n f l ^ > t T T I T ~ } O T * r i T " \ 7 ^ 1 1 1 T * i ~ 3 T a 7 i I 1 O f a foiroucjht t t i G Ws.shincf ton St&to j p n c G t o th .6 B r i t i s h C0lu.rn.bi3. 8 4 J . R. Burns, "Apples", Canadian Farm Economics, ( A p r i l 1972), V o l . 7, No. 1, p. 66. 8 5 R e p o r t of the Federal Task Force on A g r i c u l t u r e , op. c i t . p. 213. 8 6M. F i n l a y , "Low-priced U. S. Imports H i t B. C. Cherry Growers", The Vancouver Sun, (June 27, 1973), p. 23. l e v e l . 8 7 These two major problems of over-production on the i n t e r n a t i o n a l l e v e l and unr e s t r a i n e d competition cannot be solved by any one a c t i o n of e i t h e r the Federal or P r o v i n c i a l governments. However, many people i n the i n d u s t r y f e e l t h a t i n order f o r i t to su r v i v e i t must, be made economic i n s p i t e of the impending world surplus of the major t r e e - f r u i t - apples. A f e a s i b l e way t h i s might be approached would be through government p r i c e support. Whsthsx* ths suppor t b s a r s a l i s t i c f l o o r p r i e s f o r t r s s ~ f r u i t s f o r s i g n or domsstic sold, i n Canada or by govsrnmsnt subsidy i s not w i t h i n ths i n d u s t r y to ds c i d s Ths F s d s r a l govsrnmsnt i s r i c h w i t h s x p s r i s n c s i n p r i e s s t ab i 1 i z a t i o n wi th su ch coxmnodi t i s s as whs at 1 amb b aeon 89 rid. )̂r3c d.ai ry j5roduets s ugar 33ssts th.s l i s t i s snd. 1 s s s Most people i n v o l v e d i n the t r e e - f r u i t i n d u s t r y f e e l t h i s type of program i s needed si n c e the major t r e e - f r u i t problems are i n t e r n a t i o n a l . A permanent s o l u t i o n to the economic woes of the B r i t i s h Columbia f r u i t grower w i l l only be achieved, through co-operation w i t h governments on a l l l e v e l s , r a t h e r than by 1973), p. 1. 88 8 7 " C h e r r y Fee Levied", The Vancouver Sun, (June 30, "Pr i c e Gap Almost I n c r e d i b l e " , op. c i t . p. 5 8 9 I b i d c o n f r o n t a t i o n . As l a t e as 1900 the area from P e n t i c t o n to the border almost without exception was a c a t t l e - r a i s i n g area. Orchard p l a n t i n g s were few and sc a t t e r e d i n the extreme north or south of the Okanagan V a l l e y , w i t h the "Okanagan Land Boom" of the e a r l y 1900's.^ The land boom was conducted w i t h great thoroughness by many i n d i v i d u a l s and land companies. They promoted the v a l l e y i n such a way as to induce f a m i l i e s to t r a n s p l a n t themselves from the United Kingdom and other p a r t s of Canada. The f a c t s on which the Okanagan V a l l e y was s o l d were: (1) The s u c c e s s f u l experience of the Washington and Oregon growers, which gave f r u i t - g r o w i n g the necessary impetus to make i t an a t t r a c t i v e career. The Okanagan V a l l e y was, and s t i l l i s f a n t a s t i c a l l y b e a u t i f u l , w i t h v i s t a - views and c l e a r blue l a k e s . The clim a t e was moderate i n the winter and f o r the most p a r t , not e x c e s s i v e l y hot i n the summer. (2) The v a l l e y was covered w i t h Ponderosa Pine and bunch-grass which meant t h a t i t was not necessary to c l e a r 9 0 S e e Figure 1. 9 1MacPhee, op. c i t . p. 20. f o r e s t s before p l a n t i n g an. orchard. The s o i l was very f e r t i l e when i r r i g a t e d and water seemed p l e n t i f u l from the many streams running i n t o the Okanagan Lake water system. (3) The p o s s i b i l i t y of r a i s i n g s o f t t r e e - f r u i t s as w e l l as apples and pears looked encouraging due to s o i l type and c l i m a t e . (4) The v a l l e y was r e l a t i v e l y c l o sed and con- sequently f r e e from the Eastern Canadian problems of apple- scab. The c o d l i n g moth appeared on Vancouver I s l a n d i n 1890 but d i d not become a problem u n t i l 1925 i n the Okanagan V a l l e y . (5) The Governor-General, Lord Aberdeen, who was wealthy and could have the advice of the world's best h o r t i - c u l t u r i s t s , p lanted 200 acres each near the two communities 93 of Vernon and Kelowna. With t h i s k i n d of data to promote the t r e e - f r u i t i n d u s t r y , the land companies and developers were able to a t t r a c t a p o p u l a t i o n of near 30,000 people w i t h i n f i f t e e n years of the turn of the century. Some land companies had not t r i e d to mislead the people, and had helped them to make a l i v i n g through the f i r s t few years a f t e r p l a n t i n g the orchards. However, many land promoters omitted to t e l l the 92 S o f t t r e e - f r u i t s are those such as a p r i c o t s , peaches, c h e r r i e s , plums 93 MacPhee, op. c i t . p. 21-22. land buyers a number of f a c t o r s which might have a f f e c t e d d e c i s i o n s to move to the Okanagan and some of the e f f e c t s are s t i l l f e l t over seventy years a f t e r . These f a c t o r s were: (1) The area was remote from any l a r g e or growing centre of pop u l a t i o n . Therefore, the product was a long way from any p o t e n t i a l market. The P a c i f i c Coast was a long arduous two hundred and f i f t y m ile journey over the C o a s t a l Mountains. The volume of t r e e - f r u i t that was to be grown would have to have a p o r t i o n of the f r u i t markets i n the P r a i r i e s , Eastern Canada and the United Kingdom. L u c k i l y , there was no deluge of f r u i t , merely a gradual increase i n production u n t i l the marketing problem became acute. (2) The land promoters had or gave no advice as to the s u i t a b i l i t y of v a r i e t i e s of f r u i t f o r the Canadian Market. Consequently, the choice of v a r i e t i e s was based on what had been grown i n England, Eastern Canada and the Washington- Oregon areas. As l a t e as 1927 one packinghouse i n Vernon received 53 v a r i e t i e s of apples. The P r o v i n c i a l Government had to appoint a number of committees of experienced o r - c h a r d i s t s to advise on appropriate rootstocks to help cut down on v a r i e t i e s . (3) Land was not cheap at the time of the land boom. Land values i n c r e a s i n g from one to one thousand d o l l a r s an acre i n the Okanagan V a l l e y between 1900 and 1910. Remem- ber i n g t h a t p r i c e s were i n terms of a currency worth much more than the 1974 d o l l a r , there i s l i t t l e doubt t h a t these a r t i f i c i a l l y i n f l a t e d land values has been a burden on the in d u s t r y f o r seventy years. (4) Many of the i r r i g a t i o n systems provided by the land developers would prove to be inadequate when the f r u i t t rees reached f u l l m a t u r ity. (5) The most b l a t a n t o v e r s i g h t on the promoters p a r t was the f a i l u r e to t e l l the prospective growers that there had been heavy f r o s t s every seven years on the 94 average. This l i s t of f a c t o r s o u t l i n e s the m a j o r i t y of the problems from which f r u i t growers s t i l l s u f f e r n e a r l y three- quarters of a century l a t e r - namely, cost of land , cost of op e r a t i o n , s u i t a b i l i t y of v a r i e t i e s , p r o x i m i t y to lar g e centres of p o p u l a t i o n , . c a p i t a l costs of i r r i g a t i o n , costs of marketing, t r a n s p o r t a t i o n and damage by f r o s t . Technology - Is the T r e e - f r u i t Industry of B r i t i s h Columbia Keeping Pace? The r e a l i z a t i o n of the f a c t t h a t most of the present i l l s of the B r i t i s h Columbia t r e e - f r u i t i n d u s t r y e x i s t e d i n the Okanagan V a l l e y n e a r l y s e v e n t y - f i v e years ago r a i s e s the question of how has technology been adapting to these problems. Of course, d i s t a n c e from l a r g e concentrations of population i s not something t h a t technology can improve I b i d . p. 23-24. d i r e c t l y , except by improving the modes of t r a n s p o r t a t i o n . L i k e w i s e , the climate has been a f a c t o r which the o r c h a r d i s t s must l i v e w i t h . Figure 5, "MINIMUM ANNUAL TEMPERATURES, PENTICTON AIRPORT 1958 to 1971" provided the evidence that winter extreme temperatures were a problem i n the Okanagan. Due to the a b i l i t y of apple-trees to withstand lower winter temperatures than other kinds of f r u i t - t r e e s , apples have long been considered the "backbone" of the t r e e - f r u i t i n d u s t r y i n B r i t i s h Columbia. However, i n years of severe f r o s t such as 1969, even the apple crop s u f f e r e d badly. The Okanagan V a l l e y i s on the northern f r i n g e of the apple growing region of North America and the hazard of a severe winter freeze or l a t e s p r i n g f r o s t i s always present. As already mentioned, s e r i o u s winter i n j u r y has occurred at a frequency of once every seven or e i g h t years. This would suggest t h a t even w i t h i n the present growing areas of the Province only the most c l i m a t i c a l l y favoured l o c a t i o n s should be s e l e c t e d f o r apple or t r e e - f r u i t g r o w i n g . 9 5 The f i e l d of h o r t i c u l t u r e has made great advance- ments since the e a r l y days of f r u i t - g r o w i n g . P r i o r to the 1960's most apple-trees planted i n B r i t i s h Columbia orchards were s e e d l i n g rootstocks grown from apple-seed obtained from 9 5 J . E. Swales, Commercial Apple-growing i n B r i t i s h Columbia, B r i t i s h Columbia, Department of A g r i c u l t u r e , H o r t i c u l t u r a l Branch, V i c t o r i a , B.C., p. 11. processing p l a n t s . Today, most of the apples trees being planted are grown on g r o w t h - c o n t r o l l i n g , v e g e t a t i v e l y propagated r o o t s t o c k s . Most newly planted apple-trees con- s i s t of two d i s t i n c t p a r t s , rootstock and s c i o n v a r i e t y . In some i n s t a n c e s , p a r t i c u l a r l y w i t h the more tender apple v a r i e t i e s , i t i s d e s i r a b l e to have trees w i t h a winter-hardy trunk or framework. Wood of a winter-hardy v a r i e t y i s used f o r t h a t purpose and i f i t d i f f e r s from the rootstock i t i s r e f e r r e d to as an intermediate stock. Consequently, t r e e s w i t h an intermediate stock contain three d i s t i n c t s e c t i o n s - rootstock, intermediate stock and s c i o n v a r i e t y . 9 6 S c i e n t i s t s have been s t r i v i n g to develop the " i d e a l " r ootstock on which the d e s i r e d v a r i e t y . o f s c i o n can be g r a f t e d . The i d e a l rootstock must have the f o l l o w i n g d e s i r - able c h a r a c t e r i s t i c s : (1) I t should provide some degree of vigour c o n t r o l over the s c i o n v a r i e t y without adversely a f f e c t i n g produc- t i v i t y or l o n g e v i t y of a t r e e . (2) I t should promote e a r l y bearing and heavy pro- duction of the s c i o n v a r i e t y . (3) I t should be winter-hardy. (4) I t should provide good anchorage f o r a t r e e . (5) I t should be r e s i s t a n t to diseases. 97 (6) I t should be e a s i l y propagated. 9 6 I b i d . p. 16. 97 T, ., 0_ I b i d . p. 23. No rootstock i n present use possesses a l l these c h a r a c t e r i s t i c s , however i t i s f e a s i b l e t h a t one w i l l be developed i n the near f u t u r e . Another h o r t i c u l t u r a l p r a c t i c e which has been used e x t e n s i v e l y i n the Okanagan V a l l e y i s c a l l e d "topwork". This technique r e f e r s to the g r a f t i n g of scions of more d e s i r a b l e s t r a i n s onto the tops of producing t r e e s . Today., w i t h ideas changing r a p i d l y as t o t r e e s i z e and spacing, topwork has diminished i n importance i n the renovation of a t r e e - f r u i t orchard. The emphasis, i n the Okanagan apple i n d u s t r y has been to t o p - q u a l i t y and s p e c i a l i z e d v a r i e t i e s which have the comparative economic advantage over competitive markets. Consequently, the B r i t i s h Columbia o r c h a r d i s t s have been s h i f t i n g away from the Mcintosh v a r i e t y to Golden and Red D e l i c i o u s s t r a i n s . The reasons f o r the s h i f t were tw o - f o l d , f i r s t l y because the Eastern Provinces serve t h e i r market w i t h the Mcintosh v a r i e t y and have along w i t h Michigan State moved i n t o the Winnipeg market t r a d i t i o n a l l y a B r i t i s h Columbia stronghold, and secondly the Mcintosh apples does not t r a n s - port w e l l . Since B r i t i s h Columbia moves approximately 85% of i t s production outside the province., a great deal of research i n the Okanagan V a l l e y Canada Ag r i c u l t u r e . R e s e a r c h S t a t i o n at Summerland has been o r i e n t e d to v a r i e t i e s which do not b r u i s e e a s i l y arid preserve well, i n c o n t r o l l e d atmosphere s t o r a g e . 9 8 Towards t h i s end they developed the Spartan v a r i - J 4.1. „ T 4. X, 99 ety which i s a cross between the Newtown and the Mcintosh. Unfortunately problems of "Spartan breakdown" i n c o n t r o l l e d atmosphere storage have caused widespread l o s s of revenues to qrowers because of the high c u l l counts b e l i e v e d to be 100 due to low. calcium content i n the v a r i e t y . The Summerland Research S t a t i o n has been conducting research i n t o the "Spartan breakdown" problem and b e l i e v e that the calcium d e f i c i e n c y i n the apple can be r e c t i f i e d by di p p i n g the bins of apples i n a calcium c h l o r i d e s o l u t i o n at 101 the packinghouse before p u t t i n g them i n storage. Other kinds of research at Summerland i n v o l v e the use of chemicals such as " E t h r e l " which a c t i v a t e s the hor¬ mones i n the tree that cause f r u i t loosening. This chemical along w i t h the "Algar" which has a r i p e n i n g e f f e c t on apples could e a s i l y allow c e r t a i n v a r i e t i e s to be harvested a couple weeks ahead of the n a t u r a l l y r i p e n i n g v a r i e t i e s . 9 8K. C o l l u e r , "Canadian Fresh Apple Domestic Trade", The B r i t i s h Columbia O r c h a r d i s t , (June 1971) , V o l . 11, No. 9, p. 23. 9 9 S w a l e s , op. c i t . , p. 22. 1 0 0 J . Mason, "Big Research Program f o r Spartan Apple", The B r i t i s h Columbia O r c h a r d i s t , (May 1970), V o l . 10, No. 8, p. 8. 1 0 1 J . Mason, "Calcium C h l o r i d e Dips f o r Spartan Breakdown", The B r i t i s h Columbia O r c h a r d i s t , (January 1974), V o l . 14, No. 11, p. 16. 102 N. E. Looney, " E t h r e l - A Problem or Opportu- n i t y ? " , The B r i t i s h Columbia O r c h a r d i s t , (Apple 1973), V o l . 13, No. 6, p. 6. This might make the chemically t r e a t e d apples more competi- t i v e w i t h the e a r l y r i p e n i n g apples from the Oregon and Washington State areas. A great deal of research has also been done at Summerland i n connection w i t h mechanical h a r v e s t i n g of apples, U n f o r t u n a t e l y , the b r u i s i n g and s k i n puncture problem i s a long way from being s o l v e d . 1 0 3 I f however, the p r e d i c t e d changes i n consumer behaviour toward apple consumption be- comes t r u e , w i t h a marked increase i n processed apple con- sumption, the importance of a mechanical harvester even w i t h 104 . , . , ., the damage problem i s evident. Since s l i g h t l y damaged apples are processed anyway, there would be no d e t e r i o r a t i o n i n q u a l i t y of the product i f a mechanical harvester were used. In the next few years the s c i e n t i s t s at Summerland f e e l that a great many s p e c i a l i z e d types of harvest aids w i l l be devised. There w i l l be no one design which w i l l have u n i v e r s a l a p p l i c a t i o n . However, growers who supply harvest aids f o r t h e i r p i c k e r s w i l l have the l e a s t t r o u b l e i n o b t a i n - X 0 5 i n g and h o l d i n g an adequate supply of harvest labor, The major t e c h n o l o g i c a l advancement i n the i n d u s t r y has been the establishment of dwarf t r e e - f r u i t orchards. A 1 0 3 A . D. McMechan, "New Apple Harvester C a l l s f o r P i c k and Toss", The B r i t i s h Columbia O r c h a r d i s t , (January 1974), V o l . 14, No. 11, p. 14. 1 0 4 B u r n s , "The Canadian Apple Industry", op. c i t . , p. 17. 1 0 5McMechan, op. c i t . , p. 15. dwarf orchard, i s an orchard c o n s i s t i n g of growth-controlled trees which have a mature height of between 7 and 12 f e e t . The trend toward dwarf orchards has been a c c e l e r a t e d by the general lack i n supply of good l a b o r , and high labor costs on conventional orchards. In Dr. F i s h e r ' s study of high d e n s i t y p l a n t i n g s at Summerland Research S t a t i o n he found i f he i n c l u d e d land values, the added cost of a new permanent set i r r i g a t i o n system, cost of trees and p l a n t i n g , net o p e r a t i o n a l l o s s due to t r e e removal, plus 7 percent i n t e r e s t on i n i t i a l c a p i t a l costs and on o p e r a t i o n a l l o s s e s , the break-even p o i n t was four years i f the land cost between $500 to $1000 per acre and 5 years i f the land cost $2300 per acre. Dxspite the higher c a p i t a l i z a t i o n costs of the high d e n s i t y grower on a per acre b a s i s , he would seem to be f a r ahead of the low d e n s i t y grower, both from the standpoint of reaching f u l l b earing years e a r l i e r , plus the much higher p o t e n t i a l y i e l d s per acre w i t h high t r e e d e n s i t y . Dr. D. W. McKenzie's. research on the high d e n s i t y orchards of New Zealand s u b s t a n t i a t e d Dr. F i s h e r ' s f i n d i n g s concerning the p r o f i t a b i l i t y of high d e n s i t y p l a n t i n g s . 1 0 7 1 0 6 D . V. F i s h e r , "High Density P l a n t i n g s f o r High P r o f i t s " , The B r i t i s h Columbia O r c h a r d i s t , (June 1969), V o l . 9, No. 9, p. 13. 1 0 7 D . W. McKenzie, "An Assessment of the Economic E f f i c i e n c y of Semi-Intensive Apple Orchards i n Hawkes Bay", O r c h a r d i s t of New Zealand, (1970), V o l . 43, pp. 92-94. The one q u a l i f i c a t i o n i n Dr. McKenzie's work was t h a t semi- dwarf p l a n t i n g s were the most economical of a l l the growth- c o n t r o l l e d s t r a i n s . The added p r o f i t a b i l i t y from a l l types of high d e n s i t y apple orchards r e s u l t s from the lowering of pruning and p i c k i n g costs w h i l e i n c r e a s i n g the y i e l d per acre, as reported i n both s t u d i e s . Consequently, one would expect t h a t i n t h i s era of poor t r e e - f r u i t income and labor problems, t h a t there would be a much more determined swing toward h i g h - d e n s i t y orchards i n the Okanagan V a l l e y . U n f o r t u n a t e ly, Canadian o r c h a r d i s t s have been r e l a t i v e l y slow to adopt high d e n s i t y p l a n t i n g s . In B r i t i s h Columbia only 2 8 percent of the orchard acreage was i n high d e n s i t y orchards. This was approximately the same percent- age as Washington State. However Michigan has 6 0% and Ohio 50% of t h e i r orchards planted i n t h i s manner, whereas Ontario, Quebec and Nova S c o t i a l a g behind w i t h 2.6, 1.6 and 10.5% i n high d e n s i t y orchard use r e s p e c t i v e l y . Since the adoption of t h i s new system of orcharding would i n v o l v e s u b s t a n t i a l new investment as w e l l as the r e - moval of producing t r e e s - i t i s not r e a l l y a l l t h a t unusual that the Okanagan o r c h a r d i s t s are slow to change. u oD. V. F i s h e r , "An Assessment of the Present Status of High Density Orchards", i n Report of Work Planning Meeting on High Density Orchards, November 23-24, 1972 C e n t r a l Experimental Farm, Canada A g r i c u l t u r e , Research Branch, Ottawa, p. 25. The Average Income of the O r c h a r d i s t i n the Okanagan V a l l e y The o r c h a r d i s t s i n the Okanagan V a l l e y have always been c l i m a t i c a l l y d i v i d e d i n t o the north and south. The o r c h a r d i s t s i n the north grow very l i t t l e s o f t - f r u i t , espe- c i a l l y peaches, a p r i c o t s and plums due to the more severe w i n t e r s . The d i v i s i o n between north and south i n the Okanagan V a l l e y f o r the purpose of t h i s r e p o r t has been assumed to be the east-west l i n e halfway between Peachland on the south and Westbank to the north. This d i v i s i o n was adopted since i t was used i n Arendt's study. Even though Tumblemoon Ranch was i n the southern p o r t i o n of the Okanagan V a l l e y i t s d i s t r i b u t i o n of orchard acreage c l o s e l y resembled the average northern d i s t r i b u t i o n , where 84% of the acreage was i n apple production. However, since the Arendt study i s an average of 2 8 orchards i n the north and 2 9 orchards i n the south, the data determined f o r the south has been used f o r comparison. The average current r e c e i p t s per farm i n 1970 f o r the South Okanagan was $17,227 and the average f o r the whole v a l l e y was $17 , 3 8 9 . 1 1 0 The t o t a l current r e c e i p t s f o r the , , . i n same year at Tumblemoon Ranch was $10,332.68. Since the 1 0 9 A r e n d t op c i t Table 4 p 14 1 1 0 I b i d . , Table 9A, p. 20. I l l Appendix B, 197 0 Income Statement. Income Statements were based on the t a x a t i o n year i t i s probably more v a l i d to look at the crop returns on Table 3. For 1970 the t o t a l crop r e c e i p t s were $21,598.17 or $591.73 per bearing a c r e . 1 1 2 This f i g u r e compares w i t h $1,141 per bearing acre i n the South and $907 i n the North Okanagan. 1 1 3 When using Arendt's study as a comparison the one severe l i m i t a t i o n of t h i s study must be r e a l i z e d . The study a u t o m a t i c a l l y excluded any orchard operation which had no i n t e n s i v e or high d e n s i t y apple p l a n t a t i o n s . 1 1 4 Consequent- l y , the study would be biased towards the more economic and pro g r e s s i v e orchards i n the v a l l e y , thus the reason f o r the higher average r e t u r n s . Although Tumblemoon had some 10.7 acres of high d e n s i t y apple p l a n t a t i o n s they were not i n production i n 1 9 7 0 . 1 1 5 This i s another reason f o r the poor showing of Tumblemoon Ranch r e l a t i v e to the Arendt study. For the sake of c u r i o s i t y the net annual income of the average o r c h a r d i s t i n the 1970 study has been compared to the Tumblemoon O r c h a r d i s t . The net income received by the 112 Table 3, "TOTAL INCOME BY CROP YEAR COMPARED WITH INCOME BY TAXATION YEAR", t o t a l 1970 crop income d i v i d e d by 36.5 bearing acres. 1 1 3 A r e n d t , op. c i t . , Table 9B, p. 21. I b i d . p. 1. / 1 1 5 T a b l e 1, "LAND USE AND LAND USE CHANGES.TUMBLE- MOON RANCH, 1946 - 197 3." average o r c h a r d i s t i n a l l of the Okanagan V a l l e y was $-620, before d e p r e c i a t i o n expense, whereas f o r the South Okanagan the net income was $722, both based on bearing a c r e s . 1 1 6 The Tumblemoon Ranch operator had a net income of $-230.54 before d e p r e c i a t i o n expense and $-307.42 a f t e r d e p r e c i a t i o n , on the b a s i s of 36.50 bearing acres. Tumblemoon Ranch was not the most economical of orchards but i t was a t y p i c a l case regarding operating l o s s , and consequently can be considered a r e p r e s e n t a t i v e commer- c i a l t r e e - f r u i t operation i n the Okanagan V a l l e y . The Economic U n i t The economic u n i t by d e f i n i t i o n from the Royal Commission on the T r e e - f r u i t Industry of B r i t i s h Columbia, was the minimum volume of production r e q u i r e d to provide a grower w i t h the income he wishes. Or b e t t e r s t i l l the min- imal number of t r e e s which year i n and year out w i l l meet the o r c h a r d i s t ' s standard of l i v i n g . 1 1 8 In 195 8, ten acres was deemed to be the minimum s i z e f o r commercial apple p r o d u c t i o n . 1 1 9 Those people operating orchards on l e s s than 10 acres were considered 1 1 6 A r e n d t , op. c i t . Table 15A, p. 29. 117* J - r , Appendix B, op. c i t . 1 1 8MacPhee, op. c i t . , p. 782. 1 1 9 I b i d . p. 778. part-time growers since they could not expect to l i v e o f f t h e i r acreage. Their s u r v i v a l i n the i n d u s t r y depended on them f i n d i n g o f f - f a r m employment. 1 2 0 The data i n the Royal Commission, based on a 195 5 orchard survey revealed that i n excess of 70% of the Okanagan-s 3,599 growers were operating on 10 acres or l e s s , w i t h 51% operating on 7 1/2 acres of l e s s . This s t a t e of a f f a i r s was one of the major d i s c o v e r i e s of the Royal Commission. . Comparing the average orchard s i z e of Arendt's more progressive o r c h a r d i s t s to those in. the 1955 survey, i t can be seen that her 23.5 acre average s i z e 1 2 2 put her o r c h a r d i s t s group i n the top e i g h t percent of the e a r l i e r Okanagan survey c l a s s . 1 2 3 T h i s , of course, does not nec- e s s a r i l y mean that t h i s i s the case i n 1974 but her data very l i k e l y represents the above-average o r c h a r d i s t i n the Okanagan. Yet, the average o r c h a r d i s t i n her study s t i l l „ 124 showed a negative income of $-620. Even i n Arendt's group of progressive o r c h a r d i s t s 32 percent of the sample had non-farm income i n excess of 1 2 0 I b i d . , p. 776. 1 2 1 I b i d . , p. 78. 1 2 2 A r e n d t , op. c i t . , Table 4, p. 14. 1 2 3MacPhee, op. c i t . 1 2 4 A r e n d t , op. c i t . , Table 15A, p. 29 t h e i r 1970 fa m i l y farm i n c o m e . 1 2 5 This survey s u b s t a n t i a t e s Dean MacPhee's conclusion t h a t part-time employment would be necessary f o r many people i n order that they s u r v i v e i n the 4= -4- ' X 4- 1 2 6 t r e e - f r u i t i n d u s t r y . The part-time o r c h a r d i s t i n many cases i n recent years has s o l d h i s property f o r r e s i d e n t i a l use or merely l i v e s there himself w i t h f r u i t growing a hobby. Consequently, the q u a l i t y of f r u i t has u s u a l l y d e t e r i o r a t e d and a r r i v e s at the packinghouse i n small q u a n t i t i e s , thereby causing u n t i l i - z a t i o n problems f o r the packinghouse and higher operating c o s t s . U n f o r t u n a t e l y , the higher costs are l e v i e d against a l l o r c h a r d i s t s who used that packinghouse. Often the pros- pects of l i t t l e or no r e t u r n to the casual o r c h a r d i s t through a packinghouse forces him to r e s o r t to bootlegging h i s crop. He could do t h i s by s e l l i n g a t r u c k l o a d of f r u i t i n Vancouver or by s e l l i n g the whole crop on the tre e s f o r a few hundred d o l l a r s - enough to pay the taxes, and the buyer would boot- n 4.1- 127 le g the crop. Consequently, Mr. Pederson suggested a minimum s i z e f o r commercial t r e e - f r u i t orchards be adopted and the small part-time o r c h a r d i s t s could group together by management 1 2 5 I b i d . p. 3. 1 2 6MacPhee, op. c i t . , p. 776. 127, A. Pederson, "Sounding Board", The B r i t i s h Columbia O r c h a r d i s t , (June 1973), V o l . 13, No. 8, p. 6. c o n t r a c t s to achieve the minimum economic u n i t s i z e . In t h i s way some part-time o r c h a r d i s t s would not pe n a l i z e other producers by p r o v i s i o n of sub-standard f r u i t and the part-time o r c h a r d i s t s would s t i l l be able to produce commercially i f they so d e s i r e d . The s o l u t i o n to the problem of economic u n i t s i z e w i l l have to be solved by the B r i t i s h Columbia F r u i t Board through the use of e x i s t i n g or new l e g i s l a t i o n . The Tree F r u i t Marketing O r g a n i z a t i o n . i n B r i t i s h Columbia Under the terms of the N a t u r a l Products Marketing ( B r i t i s h Columbia) A c t 1 2 8 and the A g r i c u l t u r a l Products Marketing Act of Canada, 1 2 9 the f r u i t - g r o w e r s of the i n t e r i o r of B r i t i s h Columbia have been able to c o n t r o l the marketing of t h e i r products. The c o n t r o l i s vested w i t h the B r i t i s h Columbia F r u i t Board. I t has the r e s p o n s i b i l i t y of r e v i s i n g and e n f o r c i n g the marketing r e g u l a t i o n s as e s t a b l i s h e d by l e g i s l a t i o n . The B r i t i s h Columbia F r u i t Board i s composed of three o r c h a r d i s t s who are e l e c t e d by the members of the B r i t i s h Columbia F r u i t Growers A s s o c i a t i o n at t h e i r annual 128 A c t , op. c i t 129 op. c i t . N a t u r a l Products Marketing ( B r i t i s h Columbia) A g r i c u l t u r a l Products Marketing Act (Canada), 1 3 0MacPhee, op. c i t . p. 713. convention. The F r u i t Board designated B. C. Tree F r u i t s L t d . as the sole agency f o r marketing of B r i t i s h Columbia t r e e - f r u i t s grown i n the designated f r u i t - g r o w i n g areas of B r i t i s h Columbia. Through t h i s agency a l l f r u i t produced i n the i n t e r i o r of B r i t i s h Columbia must be s o l d , except f o r th a t f r u i t s o l d l o c a l l y by the growers. The F r u i t Board has j u r i s d i c t i o n over the t r a n s - p o r t a t i o n of commercial volume of t r e e - f r u i t s from the growing areas. Movement of f r u i t without the Board's a u t h o r i z a t i o n i s i l l e g a l . V i r t u a l l y a l l apples marketed by B. C. Tree F r u i t s L t d . are washed, p o l i s h e d , s o r t e d , packed, and stored i n modern packinghouses which are equipped w i t h r e f r i g e r a t e d c o l d storage rooms and i n some i n s t a n c e s , c o n t r o l l e d atmos- phere storage rooms. Most packinghouses are c o - o p e r a t i v e l y owned by the growers that supply them w i t h the f r u i t . The packinghouses hold the f r u i t u n t i l B. C. Tree F r u i t s L t d . au t h o r i z e i t s marketing and d e s t i n a t i o n . Since B r i t i s h Columbia i s remote from most of i t s markets, B. C. Tree F r u i t s L t d . encourages Okanagan growers to concentrate on h i g h - q u a l i t y t r e e - f r u i t s which r e c e i v e 132 premium p r i c e s . The stre n g t h i n the B r i t i s h Columbia marketing system comes from i t s a b i l i t y to c o n t r o l the supply 1 3 1 I b i d . , p. 717. 1 3 2 S w a l e s , op. c i t . , p. 7. of the products of the whole t r e e - f r u i t growing i n d u s t r y . Consequently, each year B. C. Tree F r u i t s L t d . disposes of a l l i t s f r u i t . In recent years, the returns to the growers f o r t h e i r f r u i t has been marginal to say the l e a s t . As a r e s u l t there have been accusations t h a t B. C. Tree F r u i t s L t d . was "covering up f o r and c o n f i d i n g i n the wholesaler r a t h e r than the farmer . The whole s i t u a t i o n i n the summer of 1973 was i g n i t e d by an e x c e p t i o n a l l y good cherry crop i n Washington State. Their growing season allowed them to market t h e i r • crop i n B r i t i s h Columbia at $8 per cr a t e f o r a week and a h a l f before the B r i t i s h Columbia crop came to market. As soon as the Okanagan crop was marketed the Washington State growers lowered t h e i r p r i c e to $5.50 per c r a t e . The U. S. growers were s e l l i n g t h e i r "surplus".crop at d i s t r e s s p r i c e s . B. C. Tree F r u i t s L t d . was forced to lower t h e i r p r i c e to $6.95 per crate which was the break-even p o i n t f o r Okanagan g r o w e r s . 1 3 4 L u c k i l y , the Federal Government imposed a surtax on c h e r r i e s imported i n t o Canada to b r i n g the minimum p r i c e per c r a t e of twenty pounds to $ 6 . 6 0 , 1 3 5 so B. C. Tree 133... w , ., . _ .. „ „ ... . N. Adams, D i s s i d e n t F r u i t Growers C r i t i c i z e P r o v i n c i a l F r u i t Marketing Agency", The Vancouver Sun, (June 15, 1973) , p. 90. 1 3 4 F i n l a y , op. c i t . , p. 23. 5"Cherry Fee Levied", op. c i t . p. 1. F r u i t s r e t a i n e d i t s p o r t i o n of the market. However a group of d i s s i d e n t f r u i t growers s t i l l f e l t t h a t c e n t r a l s e l l i n g was not g i v i n g the grower a f a i r p r i c e f o r the crop and consequently organized a caravan of truck s to t r a n s p o r t t h e i r c h e r r i e s to the Vancouver mar- k e t . 1 3 6 This was i n d i r e c t v i o l a t i o n of the powers vested i n the B. C. F r u i t Board and a r e s u l t i n g l e g a l c o n f l i c t , 137 ensued. The whole a f f a i r was an e x c e l l e n t method of b r i n g - i n g the p l i g h t of the o r c h a r d i s t to p u b l i c a t t e n t i o n , but end r e s u l t was a m a i l - b a l l o t vote to e i t h e r accept or r e j e c t the compulsory " c e n t r a l desk" s e l l i n g of B. C. Tree F r u i t s L t d . The vote held on December 12, 1973, r e s u l t e d i n a man- date f o r the c o n t i n u a t i o n of the present marketing system. The vote was 62% i n favour of the B r i t i s h Columbia F r u i t Growers A s s o c i a t i o n and as a r e s u l t the A g r i c u l t u r e M i n i s t e r David Stupich declared that government d i s c u s s i o n s concerning the t r e e - f r u i t i n d u s t r y would be w i t h only the BCFGA and not . , . .. 138 any r i v a l o r g a n i z a t i o n s . The v i c t o r y over the d i s s i d e n t f r u i t growers might be one of the few b a t t l e s that BCFGA and the B. C. F r u i t 1 3 6 ' ' F r u i t Growers to Challenge Act", The Vancouver Province, ( J u l y 4, 1973), p. 7. 1 3 7 " F r u i t Board F i l e s S u i t Against Rebel Growers", The Vancouver Sun, (July 19, 1973), p. 14. 1 3 8 " I t i s a Mandate", The B r i t i s h Columbia O r c h a r d i s t , (January 1974), V o l . 14, No. 11, p. 5. Board are able to win the next few years. Even w i t h a u n i f i e d a s s o c i a t i o n and marketing board the fut u r e i s not b r i g h t . Production costs are high and now, w i t h , a very d i f f i c u l t export s i t u a t i o n , the B r i t i s h Columbia grower i s faced w i t h a very grave f u t u r e . No matter how good the sa l e s o r g a n i z a t i o n or the q u a l i t y of the f r u i t , the B r i t i s h Columbia apple i n d u s t r y , i f forced .to s e l l more of i t s product i n Eastern Canada, w i l l be faced w i t h a tremendous f i n a n c i a l problem by v i r t u e of i t s geographical p o s i t i o n r e l a t i v e to the population centres of the east. The United States market w i l l become i n c r e a s i n g l y d i f f i c u l t to enter and maintain as production increases i n the P a c i f i c Northwest. The t r e e - f r u i t i n d u s t r y of B r i t i s h Columbia i s at a. stage i n i t s h i s t o r y when i t might be hard-pressed to meet competition at a r e t u r n that w i l l permit i t s growers to e x i s t . CHAPTER IV WILL SOCIETY PAY ITS DEBT? An o r c h a r d i s t summed up the dilemma which the a g r i c u l t u r a l land freeze created i n the Okanagan, by the f o l l o w i n g analogy: "Locking the s t a b l e door before the horse i s s t o l e n always makes good sense, but p u t t i n g the c a r t before the horse does not make good sense and i n moving to lock the farmer i n before ensuring him economic s u f f i c i e n c y i s indeed p u t t i n g the c a r t before the h o r s e " ! 3 9 The NDP Government's s o l u t i o n to the problem of farmland l o s s was indeed l i k e p u t t i n g the " c a r t before the horse". The r e a l problem i n the Okanagan was not the l o s s of farmland as much as i t was the l o s s of an e s t a b l i s h e d i n d u s t r y . Under present l e g i s l a t i o n the o r c h a r d i s t must s e l l h i s land f o r a g r i c u l t u r a l use. This land use, under the present economic c o n d i t i o n s , can be a p t l y described as s u b s i s t e n t . Consequently, he now has l o s t the "inherent value" of a higher and b e t t e r use of t h i s land. The problem of land values i n the Okanagan V a l l e y i s not a new one. At the time of the Okanagan Land Boom between 1900 and 1910 land values increased from $1 to $1000 "People F i r s t Philosophy Should Apply to Farmer", The B r i t i s h Columbia O r c h a r d i s t , (February 1973), V o l . 13, No. 3, p. 6. per acre of orchard l a n d . 1 4 0 A l l the data contained i n the Royal Commission Report of 19 58 based i t s land values on market t r a n s a c t i o n s . In the P e n t i c t o n area,.the commissioner b e l i e v e d that c a p i t a l gain was the r e a l reason f o r a great deal of the t r a n s a c t i o n s . In that area one p a r c e l of land of 4.76 acres s o l d i n 1948 f o r $6,750, i n 1950 f o r $11,200 and i n 1955 f o r $13,700. 1 4 1 On a per acre b a s i s t h i s was $1,418 i n 1958, $2,353 i n 1950 and $2,878 i n 1955. This showed a b e t t e r than 10 0% increase i n land value i n seven years. Granted, t h i s was an extreme case, but i t exempli- f i e s the problem which young o r c h a r d i s t s e n t e r i n g the business were required to face, :e. , ' , r-.. • 1' 42 Using the 1958 land value f i g u r e s from the Royal Commission Study, and a p p l y i n g them to the acreage of Tumble- moon Ranch as i t v^as \^hsn s o l d undsr land u.ss c o n t r a c t ths a r i c u l t u i r a l va 1 LIS was s u r p r i s i n g l y high Ths 1 and va 1 us was $187,450. This value was broken up i n t o 47.2 acres or ch r d at $1 V08 psr acrs or $80 618 Ths rsmaining 242 8 acres was valued at $440 per acre or $106,832. C 11 " 1956 t h.s 1 and. so 1 d. i n 197 3 \j.nd.s r ^ £̂  ^ g r*J £̂  p ^ C^t 3̂ X* cJL *̂ Cl ^ ^ ^̂ ^̂ een o f f e r e d $200,000 f o r i t as a g r i c u l t u r a l land i n the 1 4°MacPhee, op. c i t . , p. 24. 1 4 1 I b i d . , p. 85. 1 4 2 I b i d . , Table 8, p. 84. summer of 1973, he would have g l a d l y f o r g o t t e n about the s u b d i v i s i o n . But $200,000 would have' been too high f o r the land as a g r i c u l t u r a l l a n d , e s p e c i a l l y i n l i g h t of the past net income of i t s orchard operations. The o r c h a r d i s t s have been paying a market value f o r t h e i r l a n d , which in c l u d e s some l a t e n t value to convert t h a t land to a higher and b e t t e r use. Today, a f t e r passage of the Land Commission A c t , the value of t h e i r land does not contain t h a t added l a t e n t value. This l o s s of l a t e n t value brings up the question of who i s paying the cost of "Farmland Reserves". Is s o c i e t y paying f o r the p r e s e r v a t i o n of farmland? The answer i s no. In the Okanagan the grower i s paying by being forced to stay i n an i n d u s t r y which i s not economic, and has l o s t i t s l a t e n t value to develop. An Okanagan grapegrower expressed a common view towards the land f r e e z e : "As p a r t of s o c i e t y I am :very w i l l i n g to share the cost w i t h s o c i e t y of pr e s e r v i n g t h i s l a n d , but as a land owner I cannot a f f o r d t h i s luxure on my own. ... So c i e t y when they want something they buy i t , they don't s t e a l or sneak i t away."143 I t i s u n f a i r t h a t the o r c h a r d i s t already i n t r o u b l e f i n a n c i a l l y should be forced to stay i n the business. The s o l u t i o n to the l o s s of a g r i c u l t u r a l and orchard land i n the "We Preserved The Land.,..", The B r i t i s h Columbia O r c h a r d i s t , (February 1973), V o l . 13, No. 3, p. 18. Okanagan V a l l e y could have been b e t t e r achieved by making the i n d u s t r y economic i n the f i r s t place. I f the o r c h a r d i s t were making a good l i v i n g and the operations were c o n s i s t e n t l y p r o f i t a b l e , . e x c e p t f o r the o c c a s i o n a l f r o s t , the problem of orchard p r e s e r v a t i o n would have a l l but disappeared. I t would not have been necessary to have.a blanket c o n t r o l , but simply planning l e g i s l a t i o n t hat would r e q u i r e any move to acquire orchard land f o r other than a g r i c u l t u r e purposes to be judged on i t s m e r i t s . There probably would have been few a p p l i c a t i o n s f o r rezoning because: " I f the orchard acre can again become p r o f i t a b l e then i t would.be s h o r t s i g h t e d on the part of the owner to s e l l what should be a sound p r o f i t making operation f o r a short term gain. I t would.be something l i k e s e l l i n g blue chip stocks f o r a quick p r o f i t on a market fl u c t u a t i o n . " 1 4 4 U n f o r t u n a t e l y , the land freeze i s a r e a l i t y and i t s e f f e c t on land use change should be obvious f o r the next year or so w i t h no land being converted from orchards to other more i n t e n s i v e uses. I f however, the t r e e - f r u i t i n d u s t r y i n B r i t i s h Columbia i s forced to stand on i t s own m e r i t , i t w i l l only be two years at the most before the small h e a v i l y mortgaged f r u i t grower w i l l be forced o f f the land i f he does not have another source of income. This would have occurred without the a g r i c u l t u r a l land f r e e z e , 1 4 4 , , P e o p l e F i r s t Philosophy...", op. c i t . but now the Land Commission would be able to buy the land at the new a g r i c u l t u r a l land p r i c e . I n v a r i a b l y , the p r i c e would be lower than cost to the grower since the l a t e n t value of development would be l o s t . H o p e f u l l y , the Land Commission w i l l pay the "Market value" so that the grower w i l l not be r e q u i r e d to s u b s i d i z e s o c i e t y i n the preserva- t i o n of a g r i c u l t u r a l land. The best s o l u t i o n f o r the Province and the t r e e f r u i t i n d u s t r y would be to r e v i t a l i z e the i n d u s t r y . The means to t h i s end would probably be through a cost of production subsidy w i t h the necessary a b i l i t y to group small o r c h a r d i s t s . i n t o economically s i z e d farms., p o s s i b l y as small co-operatives. The Land Commission could then regulate the change i n land use of i s o l a t e d and uneconom- i c a l orchards. I f the Tree F r u i t Industry i s not made economic the growers w i l l be paying a high p r i c e f o r farmland r e - serves. But i f the necessary help from the NDP government i s forthcoming s o c i e t y w i l l be paying p a r t of i t s debt to the f r u i t growers f o r p r e s e r v i n g t h e i r land. Land use change under the Land Commission w i l l be more o r d e r l y . However, those who are allowed to s e l l t h e i r land f o r development w i l l o b t a i n greater p r o f i t s than before the f r e e z e , as was the case on Tumblemoon Ranch. The a g r i - c u l t u r a l , land freeze and the Land Commission are forces i n the planning environment which have to be accepted and w i l l p o s s i b l y r e s u l t i n the o r d e r l y change i n land use i n the Okanagan V a l l e y . Unfortunately, the s i n g l e major f a c t o r a f f e c t i n g the v i a b i l i t y of the T r e e - F r u i t Industry i n the Okanagan V a l l e y i s weather. Regardless of p r i c e subsidy or the grouping of small orchards i n t o management groups the problem of severe weather s t i l l e x i s t s . I t i s time th a t the Industry evaluated t h i s problem c r i t i c a l l y and allowed the market system to e l i m i n a t e those orchards which were c o n s i s t e n t l y a f f e c t e d by f r o s t . However, a commitment of the Land Commission to a i d o r c h a r d i s t s l o c a t e d i n c l i m a t e l y s u i t a b l e areas to accumulate adjacent land i s needed. In t h i s way there would be fewer o r c h a r d i s t s , but those l e f t would be l a r g e r , more economic and much l e s s at the mercy of f a t e . LITERATURE CITED P u b l i c Documents B r i t i s h Columbia. M u n i c i p a l A c t, R.S.B.C. 1960. Chapter 225, S e c t i o n 702(2), Section 702A and 702A(1). B r i t i s h Columbia. N a t u r a l Products Marketing ( B r i t i s h Columbia) A ct, R.S.B.C. 1948. Chapter 200, s. 1; 1960 Chapter 263, s. 1. Canada. A g r i c u l t u r a l Products Marketing A c t , R.S.. 1970. Chapter A-7, s. 2, c. 1 (1st. Supp.), s. 1. Canada. CENSUS OF CANADA, 1971. A g r i c u l t u r e B r i t i s h Columbia. S t a t i s t i c s Canada: V o l . IV - P a r t 3 ( B u l l e t i n 43-4), May 1973. Canada. Farm C r e d i t A c t , R.S. 1959. C. 43, s. 1; 1970, CHAPTER F-2, s. 16, ( e ) , ( i i ) . Canada. Income Tax Act, R.S. 1952. Chapter 14 8 as amended i s repealed except P a r t IV; 1970-71-72, Chapter 63, s. 1. Books B l a n c h f i e l d , W i l l i a m C , and Jacob Oser. ECONOMICS R e a l i t y Through Theory. New York: Harcourt Brace Jovanovich, Inc., 1973. Pp. x + 387. C a r r o l l , Lewis. "Through the Looking Glass and What A l i c e Found There", Chapter 2, Macmillan, 1871, c i t e d i n THE ANNOTATED A l i c e , A l i c e ' s Adventures i n Wonderland and Through the Looking Glass by Lewis C a r r o l l , I n t r o d u c t i o n and Notes by M a r t i n Gardner. New York: Clarkson N. P o t t e r , I n c . / P u b l i s h e r , 1960. Pp. 351. Hosie, R. C. Native Trees of Canada. 7th ed. r e v i s e d . Ottawa: Information Canada, 1973. Pp. 380. Information Canada. Canadian A g r i c u l t u r e i n the Seventies. Report of the Federal Task Force on A g r i c u l t u r e . Ottawa: Information Canada, 1969. Pp. x x i i + 475. MacPhee, Dean E. D. The Report of the Royal Commission on the T r e e - f r u i t Industry of B r i t i s h Columbia. V i c t o r i a : Queen's P r i n t e r , 1958. Pp. 805. Woodsworth, K. C. (ed.). Land Use C o n t r o l . Vancouver: Center f o r Continuing Education, U n i v e r s i t y of B r i t i s h Columbia, 1972. Pp. i i + 95. A r t i c l e s and P e r i o d i c a l s Adams, N. " D i s s i d e n t f r u i t growers c r i t i c i z e p r o v i n c i a l f r u i t marketing agency", The Vancouver Sun, (June 15, 1973), p. 90. B r i t i s h Columbia. Climate of B r i t i s h Columbia, Department of A g r i c u l t u r e , V i c t o r i a : Queen's P r i n t e r , 1958 to 1972 . Burns, J . R. "Apples", Canadian Farm Economics, ( A p r i l 1972), V o l . 7, No. 1, pp. 62-67. . "The Canadian Apple Industry", Canadian Farm Economics, (December 1969), V o l . 4, No. 5, pp. 8-17. "Cherry Fee Levied", The Vancouver Sun, (June 30, 1973) pp. 1-2. C o l l u e r , K. "Canadian Fresh Apple Domestic Trade", The B r i t i s h Columbia O r c h a r d i s t , (June 1971) V o l . 11, No. 9, pp. 20-26. Dolman, Richard. "Questions sprawl over land f r e e z e " , The Vancouver Sun, (March 3, 1973), p. 24 and 32. "Federal Economists Warn of Over-Production i n F r u i t s " , The B r i t i s h Columbia O r c h a r d i s t , (June 1970), V o l . 10, No. 9, pp. 4-5. F i n l a y , M. "Low-priced U. S. imports h i t B. C. cherry growers", The Vancouver Sun, (June 27, 1973), p. 23. F i s h e r , D. V. "High Density P l a n t i n g s f o r High P r o f i t s " , The B r i t i s h Columbia O r c h a r d i s t , (June 1969), V o l . 9, No. 9, pp. 11-17. Fotheringham, A l l a n . "There's An Obvious Reluctance to Downgrade ...", The Vancouver Sun, (March 14, 1973), p. 43. "Four Land Act Amendments Pledged", The Vancouver Sun, (March 15, 1973), p. 1. "FREEZE ON FUTURE FARM LAND SUBDIVISION", The B r i t i s h Columbia O r c h a r d i s t , (January 1973), V o l . 13, No. 2, p. 21. " F r u i t board f i l e s s u i t against r e b e l growers", The Vancouver Sun, (July 19, 1973), p. 14. " F r u i t growers to challenge a c t " , The Vancouver P r o v i n c e , (July 4, 1973), p. 7. " I t i s a Mandate", The B r i t i s h Columbia O r c h a r d i s t , (January 1974), V o l . 14, No. 11, p. 5. "Land board named", The Vancouver Province, (May 18, 1973), p. 1. Looney, N. E. " E t h r e l - A Problem or Opportunity?", The B r i t i s h Columbia O r c h a r d i s t , ( A p r i l 1973), V o l . 13, No. 6, p. 6. Mason, J . "Big Research Program f o r Spartan Apple", The B r i t i s h Columbia O r c h a r d i s t , (May 1970), V o l . 10, No. 8, p. 8. T h I - B r l t l i h Columbia Orchardist, (January 1974) , V o l . 14, No. 11, p. 16. McKenzie, D. W. "An Assessment of the Economic E f f i c i e n c y of Semi-Intensive Apple Orchards i n Hawkes Bay" O r c h a r d i s t of New Zealand, (1970), V o l . 43, pp. 92-94. McMechan, A. D. "New apple harvester c a l l s f o r p i c k and t o s s " , The B r i t i s h Columbia O r c h a r d i s t , (January 1974), V o l . 14, No. 11, pp. 14-15. "NDP sweeps to B. C. v i c t o r y , ends Bennett's 20 year r u l e " , The Globe and M a i l , Toronto (August 31, 1972), p. 1. N i c h o l s , M a r j o r i e . "Grip sought on a l l l a n d " , The Vancouver Sun, (February 23, 1973), pp. 1-2. . "Key s e c t i o n s of land act o f f i c i a l l y put i n t o f o r c e " , The Vancouver Sun, (July 4, 1973), p. 1. . "Richmond lawyer appointed land commission chairman", The Vancouver Sun, (May 17, 1973), p. 1. Pederson, A. "Sounding Board", The B r i t i s h Columbia O r c h a r d i s t , (June 1973), V o l . 13, No. 8, p. 6. "People F i r s t Philosophy Should Apply To Farmer", The B r i t i s h Columbia O r c h a r d i s t , (February 1973), V o l . 13, No. 3, p. 6. B r i t i s h Columbia O r c h a r d i s t , " P r i c e Gap Almost I n c r e d i b l e " , The (August 1970), V o l . 10, No. 1 1, p. 4 (bottom) Remain, Ken. " B a r r e t t goes F i s h i n g , Bennett set meeting to plan NDP takeover", The Globe and M a i l , Toronto, (September 1, 1972), p. 8. S i n d e l a r , G i l b e r t E. "The R i s i n g L e v e l of World Apple Production", The B r i t i s h Columbia O r c h a r d i s t , (January 1970), V o l . 10, No. 4, pp. 30-33. S t a t i s t i c s Canada. Qua r t e r l y B u l l e t i n of A g r i c u l t u r a l S t a t i s t i c s , October - December, 1971. "The Industry Needs A L i f e b e l t " , The B r i t i s h Columbia O r c h a r d i s t , (August 1970), V o l . 10, No. 11, p. 4. Tukey, R. B. " I m p l i c a t i o n s of Economics on Orchard Manage- ment", Proceedings of the F i r s t BCFGA H o r t i c u l t u r a l Conference, The 1969 Apple Forum, (November 24, 25, 1969), P e n t i c t o n , B. C, pp. 33-62. Watts, Peter. "Land Act A n a l y s i s " , J o u r n a l of Commerce, (May 8, 1973), p. 8. "We Preserved The Land...", The B r i t i s h Columbia O r c h a r d i s t , (February 1973), V o l . 13, No. 3, p. 18. Reports Arendt, Caralee. Costs and Returns on F r u i t Farms i n the Okanagan V a l l e y of B. C , 1969 and 1970. Economics Branch, A g r i c u l t u r e Canada, Vancouver, B. C. Economics Branch P u b l i c a t i o n No. 73/1, Report Completed i n December 1972, Amended June 1973. Pp. i i + 41. F i s h e r , D. V. "An Assessment of the Present Status of High Density Orchards", i n Report of Work Planning Meeting on High Density Orchards. November 2 3-24, 1972. C e n t r a l Experimental Farm, Canada A g r i c u l t u r e , Research Branch, Ottawa. Pp. 22-37. Swales, J . E. Commercial Apple-growing i n B r i t i s h Columbia. B r i t i s h Columbia, Department of A g r i c u l t u r e , H o r t i - c u l t u r a l Branch. V i c t o r i a : Queen's P r i n t e r , 1971. Pp. 127. Other Sources B r i t i s h Columbia Lands S e r v i c e , Department of Lands, Forests and Water Resources, "The Okanagan Area B u l l e t i n , 1968", V i c t o r i a : Queen's P r i n t e r , 1968. Study Committee, Canada - B r i t i s h Columbia, Okanagan Basin Agreement, "Economic Growth i n the Okanagan Basin to 1980", P r e l i m i n a r y Study Data - B u l l e t i n No. 9, J u l y 15, 1972, P e n t i c t o n : F i n l a y P r i n t i n g L t d . 1972. pp. 1-4. . "Recreation and A e s t h e t i c Resources", P r e l i m i n a r y Study Data - B u l l e t i n No. 5, J u l y 15, 1972. P e n t i c t o n : F i n l a y P r i n t i n g L t d . , 1972. pp. 1-4. The B r i t i s h Columbia F r u i t Growers A s s o c i a t i o n , "Income Requirement Proposals f o r the T r e e - f r u i t Industy i n B r i t i s h Columbia", B r i e f to Honourable David D. S t u p i c h , M i n i s t e r of A g r i c u l t u r e , Kelowna, B. C. May 8, 1974, pp. 1-5. Appendix A STEREOSCOPIC PAIR OF AERIAL PHOTOGRAPHS OF TUMBLEMOON RANCH SOURCE = Aerial Photographs B C 4 I 4 3 - 0 9 4 and BC 4143-095 Appendix B TUMBLEMOON RANCH Income Statement For the Year Ending December 31, 195 8 20,146.30 240.78 23. 33 598.86 2,280.08 Income: Proceeds of F r u i t $ I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e Expenses: Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other' I n t e r e s t Charges Licenses and Dues Accounting and Legal Pre-harvest Costs F e r t i l i z e r & Spray Expense 1,749.94 Repairs, small Tools 607.71 Gas, O i l - Equipment 1,138.90 Repairs, Equipment 1,811.3 0 Bank Charges (Operating) 2,129.38 Wages & B e n e f i t s 573.50 Other (Postage, s t a t i o n a r y ) — Harvest Costs $ 1 0, 896.51 640, 198 130, 751, 37 94 99 73 $ 23,289.35 $ 2,722.03 $ 8,010.73 Wages & B e n e f i t s Hauling Packing House Charges Custom Work, Equip. Rentals Car Expense (Gas & O i l ) _ Ex t r a o r d i n a r y Costs Trees Loss Co—op Shares Net P r o f i t or Loss (Before Depreciation) De p r e c i a t i o n Expense Net P r o f i t or Loss ( A f t e r Depreciation) $10,896.51 _$ 21,629.27 $ 1,660.08 $ 2,950.55 $ (1,290.47) SOURCE: Income Tax Returns; P r o f i t and Loss Ledgers from O r c h a r d i s t ' s f i l e s . Format f o r Expenses from: R. B. Tukey, " I m p l i c a t i o n s of Economics on Orchard Management", Proceedings of the F i r s t BCFGA H o r t i c u l t u r a l Conference, The 196 9 APPLE FORUM, (November 24, 25, 1969), P e n t i c t o n , B. C. P. 37. $ 12,718.66 245.31 61.22 Income; Proceeds of F r u i t I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e Expenses: Overhead Costs Taxes and Water $ 183.06 Telephone, L i g h t & Power 855.90 Insurance-Orchard-Dwelling 60.50 'Other' I n t e r e s t Charges 760.50 Licenses and Dues Accounting and Legal . Pre-harvest Costs < Spray Expense i l l Tools 83 96 82 F e r t i l i z e r & Repairs, sma Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ) U a ~Y*\7 f^Cjt C"10 ^ t ^ $ 7,430.80 1,104 215 1,092 1,484.15 2,229.89 391 22 09 83 Wages & B e n e f i t s Hauling Packing House Charges Custom Work, Equip. Rentals Car Expense (Gas & O i l ) E x t r a o r d i n a r y Costs Trees Loss Co-op Shares — - $ 13,025.19 $ 1,859.96 $ 6,541.57 $ 7,430.80 Net P r o f i t or Loss (Before Depreciation) De p r e c i a t i o n Expense _$ 15,832.33 $ (2,807.14) $ 2,235.33 $ (5,042.47) Income: Proceeds of F r u i t I n t e r e s t (from Co-Ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e $ 14,168.47 249.25 21.69 $ 14,439.41 Expenses: Overhead Costs 604 .42 1,144.27 196.72 1,098.53 81.90 Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other' I n t e r e s t Charges Licenses and Dues Accounting and Legal _ Pre-harvest Costs F e r t i l i z e r & Spray Expense Repairs, small Tools Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ) Ha.i*vss t Costs Wages & B e n e f i t s $ 7,882.25 Hauling 11.69 Packing House Charges Custom Work, Equip. Rentals Car Expense (Gas & O i l ) E x t r a o r d i n a r y Costs Trees 1,947.19 1,037.23 425.87 723 2 ,118 414 5 07 77 85 03 $ 3,125.84 $ 6,672.01 $ 7,893.94 Loss Co-op Shares ~ - _ Net P r o f i t or Loss (Before Depreciation) D e p r e c i a t i o n Expense _$ $ $ 17,691.79 (3 252 38) 1,985.63 Income: Proceeds of F r u i t $ I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e Expenses: Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other' I n t e r e s t Charges Licenses and Dues Accounting and Legal Pre-harvest Costs F e r t i l i z e r & Repairs, sma Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Other (Postage, Stationary) Harvest Costs 25,723.01 58.00 ___ZZZ- 915.65 1,198.54 255.35 854.07 22 .00 37.50 < Spray Expense i l l Tools .471.52 ,371.05 ,019.90 ,648.24 504.01 14-00 $ 10,296.14 7.49 Wages & B e n e f i t s Hauling Packing House Charges Custom Work, Equip. Rentals Car Expense (Gas & O i l ) - E x t r a o r d i n a r y Costs Trees $ 535.25 Loss Co-op Shares f i t O] $ 25,781.01 $ 3,283.11 $ 8,028.72 $10,303.63 Net Pro >r Loss (Before Depreciation) D e p r e c i a t i o n Expense 535.25 $22,150.71 $ 3,630.30 $ 1 996 77 ( Income: Proceeds of F r u i t I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop Assistance $ 25,777.56 114.00 $ 25,891.56 Expenses: Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other 1 I n t e r e s t Charges Licenses and Dues Accounting and Legal Pre-harvest Costs Expense Is 658. ,302. 922. 851, 66, 30, 83 66 20 71 84 50 F e r t i l i z e r & Spray Repairs, small Too Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ! C.n c; +" c; 1,875 2,188 989 65 01 98 1,565.88 603.30 13.00 Harvest Costs Wages & B e n e f i t s Hauling Packing House Charges Custom Work, Equip. Rentals Car Expense (Gas & O i l ) _ E x t r a o r d i n a r y Costs $ 11,462, 1,166 73 45 Trees Loss Co-op Net Pro f i t o Shares $ 3,832.74 $ 7,235.82 $12,629.18 Depr e c i a t i o n Expense r Loss (Before Depreciation) n $ 23,697.74 $ 2,193.82 $ 1,583.04 30,226.69 100.00 Income: Proceeds of F r u i t $ I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy- Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e _ Expenses: Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other' I n t e r e s t Charges Licenses and Dues Accounting and Legal Pre-harvest Costs F e r t i l i z e r & Spray Expense Repairs, small Tools Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ) Harvest Costs Wages & B e n e f i t s $ 8,161.88 Hauling 583.71 Packing House Charges 152.04 Custom Work, Equip. Rentals Car Expense (Gas & O i l ) Ex t r a o r d i n a r y Costs Trees Loss Co-op Shares . $ 30,326.69 478.11 1,282.62 810.60 866.74 40.00 17 .50 2,929.54 1,158.57 986.82 1,281.20 429.57 $ 3,495.57 72.95 $ 6,858.65 $ 8,897.63 Net P r o f i t or Loss (Before Depreciation) D e p r e c i a t i o n Expense _$ 19,251.85 $ 11,074.84 $ 1,832.58 Income: Proceeds of F r u i t $ I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e _ Expenses; Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other 1 I n t e r e s t Charges Licenses and Dues Accounting and Legal _ Pre-harvest Costs F e r t i l i z e r & Spray Expense Repairs, small Tools Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Other ^ P o s t a g e , S t a t i o n a r y ) 18,644.11 100.00 $ 18,744.11 551 ,239 769 835 40 17 01 21 70 72 00 ,50 $ 3,453.14 312, 626, 777 ,435 588 16 38 66 41 51 5.80 $ 6,745.92 Harvest Costs Wages & B e n e f i t s Hauling Packing House Charges $ 11,181, 133, 372, 75 03 94 Custom Work, Equip. Rentals Car Expense (Gas & O i l ) E x t r a o r d i n a r y Costs Trees Loss Co-op Shares --- _ Net P r o f i t or Loss (Before Depreciation) D e p r e c i a t i o n Expense $11,687.72 $ 21,886.78 $ (3,142.67) $ 2,521.89 TUMBLEMOON RANCH For the Yea^Endin^December 31, 196 5 Income; Proceeds of F r u i t $ I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e 8,989.08 50.00 $ 9,039.08 Expenses: Overhead Costs Taxes and Water $ 6 34.35 Telephone, L i g h t & Power 1,17 8.90 Insurance-Orchard-Dwelling 257.60 'Other' I n t e r e s t Charges 517.44 Licenses and Dues 18.00 Accounting and Legal _ Pre—ha.rvest Costs F e r t i l i z e r & Spray Expense 1,587.24 Repairs, small Tools 752.17 Gas, O i l - Equipment 482.34 Repairs, Equipment Bank Charges (Operating) 1,647.10 Wages & B e n e f i t s 232.89 Other (Postage, s t a t i o n a r y ) 14.07 Harvest Costs Wages & B e n e f i t s $ 4,424.96 Hauling 604.70 Packing House Charges 380.03 Custom Work, Equip. Rentals Car Expense (Gas & O i l ) E x t r a o r d i n a r y Costs Trees Loss Co-op Shares ___IZZL__ 17.50 $ 2,623.79 $ 4,715.81 $ 5,409.69 Net P r o f i t or Loss (Before Depreciation) _$12,749.29 $(3,710.21) De p r e c i a t i o n Expense $ 2,811.78 Income1: Proceeds of F r u i t I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e $ 15,983.09 4,334.00 $ 20,317.09 Expenses: Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other' I n t e r e s t Charges Licenses and Dues Accounting and Legal Pre-harvest Costs 662 1,398 436 933 .52 57 ,36 .15 383.00 $ 3,813.60 F e r t i l i z e r & Spray Repairs, small Too Expense Is Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ^ Harvest Costs Wages & B e n e f i t s $ Hauling Packing House Charges Custom Work, Equip. Rentals Car Expense (Gas & O i l ) _ E x t r a o r d i n a r y Costs Trees $ Loss Co-op Shares 1,619.78 721.83 276.57 522 415 79 46 $ 3,556.43 7 ,893, 41 75 69 $ 7,935.44 392.46 $ 392.46 $15,697.93 Net P r o f i t or Loss (Before Depreciation) De p r e c i a t i o n Expense $ 4,619.16 $ 2,705.79 $ 25,473.38 Income; Proceeds of F r u i t I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e Expenses: Overhead Costs Taxes and Water Telephone, L i g h t & Power Insurance-Orchard-Dwelling 1,427.03 'Other 1 I n t e r e s t Charges 1,983.90 Licenses and Dues Accounting and Legal Pre-harvest Costs $ 547.05 128.42 731.67 1,132.14 $ 26,148.85 78.45 $ 5,353.19 . Spray Expense i l l Tools 1,811.36 1,866.20 405.87 531.89 F e r t i l i z e r & Repairs, sma Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ) Harvest Costs Wages & B e n e f i t s $ 10,105.95 Hauling 719.52 Packing House Charges 481.27 Custom Work, Equip. Rentals Car Expense (Gas & O i l ) E x t r a o r d i n a r y Costs Trees Loss Co—op Shares Net P r o f i t or Loss (Before Depreciation) D e p r e c i a t i o n Expense $ 4,615.32 $11,306.74 _$ 21,275.25 $ 4,873 . 60 $ 2,705.79 $ 26,233.83 114.00 3^2.50 794.58 324.81 506.30 784.97 121.00 $ 5,531.66 Income: Proceeds of F r u i t I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e _ Expenses; Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other' I n t e r e s t Charges Licenses and Dues Accounting and Legal _ Pre-harvest Costs F e r t i l i z e r & Spray Expense Repairs, small Tools Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) 0?her ( P o S a g e ^ s t a t i o n a r y i _ Harvest Costs Wages & B e n e f i t s $ 10,091.22 Hauling 549.89 Packing House Charges 332.51 Custom Work, Equip. Rentals 118.40 Car Expense (Gas & O i l ) E x t r a o r d i n a r y Costs Trees Loss Co—op Shares Net P r o f i t or Loss (Before Depreciation) De p r e c i a t i o n Expense $ 26,660.33 466.88 272 .15 530.50 531.12 $ 3,800.65 $11,092.02 $ 20,424.33 $ 6,236.00 $ 2,778.90 Income: Proceeds of F r u i t $ I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e 14,705.53 60.00 $ 14,765.53 875.80 164.84 384.30 .881.33 75.00 $ 3,381.27 Spray Expense .1 Tools 649. 833. 370, 41 07 02 33.41 Expenses: Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other' I n t e r e s t Charges Licenses and Dues Accounting and Legal Pre-harvest Costs F e r t i l i z e r & Repairs, smal! Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ^ Harvest Costs Wages & B e n e f i t s $ Hauling Packing House Charges Custom Work, Equip. Rentals Car Expense (Gas & O i l ) - . $ E x t r a o r d i n a r y Costs Trees $ Loss Co—op Shares _ Net P r o f i t or Loss (Before Depreciation) D e p r e c i a t i o n Expense $ 1,885.91 3.38 43.00 46.38 $ 5,313.56 9 451 97 , .9 2,167.23 Income; Proceeds of F r u i t $ I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e 10,332.68 $ 10,332.68 Expenses: Overhead Costs Taxes and Water $ 989.74 Telephone, L i g h t & Power 1,305.49 Insurance-Orchard-Dwelling 1,173.78 'Other' I n t e r e s t Charges 312.12 Licenses and Dues Accounting and Legal 25.00 $ 3,806.13 Pir6"™iTi3.!cvGst Costs F e r t i l i z e r & Spray Expense 1,879.35 Repairs, small Tools 1,19 8.31 Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ) ^ Hdrvsst Costs Wages & B e n e f i t s $ 8,835.25 Hauling 538.19 Packing House Charges 536.22 Custom Work, Equip. Rentals Car Expense (Gas & O i l ) 57.00 $ 9,966.66 Ex t r a o r d i n a r y Costs r r e e % cv, $ 3 9 5 ' 4 6 S 395 46 S18 747 35 Loss Co-op Shares . ? 53b. 4b :?IB,/4/.JD 740.19 260.41 465.01 35. 83 $ 4,579.10 Net P r o f i t or Loss (Before Depreciation) $(8 414 67) De p r e c i a t i o n Expense $ 2 806 28 Income: Proceeds of F r u i t I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e Expenses: Overhead Costs Taxes and Water $ Telephone, L i g h t & Power Insurance-Orchard-Dwelling 'Other' I n t e r e s t Charges Licenses and Dues Accounting and Legal Pre-harvest Costs $ 20,098.94 2,954.12 $ 23,053.06 983.80 1,269.77 1,296.82 5,922.34 30.00 $ 9,502.73 Spray Expense .1 Tools 965.70 686.37 619.83 036, 544 95 22 F e r t i l i z e r & Repairs, smal Gas, O i l - Equipment Repairs, Equipment Bank Charges (Operating) ] Wages & B e n e f i t s Other (Postage, s t a t i o n a r y ] _ Harvest Costs Wages & B e n e f i t s $ Hauling Packing House Charges 2,345.70 Custom Work, Equip. Rentalsl,108.41 Car Expense (Gas & O i l ) 392.44 E x t r a o r d i n a r y Costs Trees $ 156.76 54.11 $ 5,907.18 10,340.16 $14,186.71 Loss Co-op Shares $ 156.76 $29,753.38 Net P r o f i t or Loss (Before Depreciation) De p r e c i a t i o n Expense $(6,700.32) $ 2,879.50 25,795.41 Income; — P r o c e e d s of F r u i t $ I n t e r e s t (from Co-ops) Sun Rype Products L t d . Government Apple Subsidy Custom Work Rental Income (Pasture) Timber Sales Crop A s s i s t a n c e Expenses; Overhead Costs Taxes and Water $ 1,151.20 Telephone, L i g h t & Power 1,337.77 Insurance-Orchard-Dwelling 1,075.72 'Other' I n t e r e s t Charges 1,850.14 Licenses and Dues Accounting and Legal 87.50 $ 5,502.33 Pre-harvest Costs F e r t i l i z e r * Spray Expense Repairs, small Tools Gas, O i l . - Equipment Repairs, Equipment Bank Charges (Operating) Wages & B e n e f i t s $ 25,795.41 1,999.46 1,509.34 769.49 Other (Postage, s t a t i o n a r y ^ Harvest Co Z Vts' ,646.60 604 .76 30. 00 Wages & B e n e f i t s Hauling Packing House Charges CarXense^Gafr E x t r a o r d i n a r y Costs Trees $ Loss Co-op Shares _ $ 6,559.65 $ 11,490.52 1,098.72 952.85 349.00 $13,891.09 9,146.55 $ 9,146.55 $35,099.62 Net P r o f i t or Loss (Before Depreciation) D e p r e c i a t i o n Expense $(9,304.21) $ 2,810.25 $(12,114.46) Appendix C LAND USE CONTRACT THIS AGREEMENT made t h i s day of 19 BETWEEN: REGIONAL DISTRICT OF OKANAGAN-SIMILKAMEEN a body Corporate under the laws of the Province of B r i t i s h Columbia; (Hereinafter c a l l e d "Regional D i s t r i c t " ) OF THE FIRST PART AND: THE ORCHARDIST-OPERATOR OF THE SECOND PART WHEREAS the Regional D i s t r i c t , pursuant to Section 702A of the M u n i c i p a l A c t , being Chapter 255 of the Revised Statutes of B r i t i s h Columbia, A.D. 1960 and Amendments there- t o , may, notwithstanding any bylaw of the M u n i c i p a l i t y , or Sect i o n 712 or 713 of the M u n i c i p a l A c t , enter i n t o a land use c o n t r a c t c o n t a i n i n g such terms and co n d i t i o n s f o r the use and development of land as may be agreed upon w i t h a developer, and t h e r e a f t e r the use and development of the land s h a l l be i n accordance w i t h the land use c o n t r a c t ; AND WHEREAS the M u n i c i p a l Act re q u i r e s that .the Board of the Regional D i s t r i c t ( h e r e i n a f t e r r e f e r r e d to as the "Board") consider the c r i t e r i a as set out i n Sec t i o n 702(2) and 702A(1) i n a r r i v i n g at the terms, c o n d i t i o n s and co n s i d e r a t i o n contained i n the land use c o n t r a c t ; AND WHEREAS the Developer has presented to the Board a scheme of use and development of the w i t h i n des- c r i b e d lands and premises that would, be i n contravention of a bylaw of the Regional D i s t r i c t or Section 712 or 713 of the Mu n i c i p a l Act or both, and has requested that the Regional D i s t r i c t enter i n t o t h i s c o n t r a c t under the terms, c o n d i t i o n s and f o r the c o n s i d e r a t i o n h e r e i n a f t e r set f o r t h ; AND WHEREAS a l l other bylaws of the Regional D i s t r i c t as the same r e l a t e to and regula t e the use of the above described lands are thereby waived or v a r i e d to the extent necessary to give e f f e c t to the terms and c o n d i t i o n s set f o r t h h e r e i n ; AND WHEREAS the Board, having given due consider- a t i o n to the c r i t e r i a set f o r t h i n Sections 702(2) and 702A(1) of the M u n i c i p a l A ct, have agreed to the terms, c o n d i t i o n s and c o n s i d e r a t i o n h e r e i n contained; AND WHEREAS the lands h e r e i n a f t e r . d e s c r i b e d l i e w i t h i n the area designated by " E l e c t o r a l Area " Zoning Bylaw Number "Development Area"; AND WHEREAS the Board and the Developer both acknowl- edge th a t the Regional D i s t r i c t could not enter i n t o t h i s Agreement, u n t i l the Board h e l d a p u b l i c hearing i n r e l a t i o n to t h i s Agreement, and considered any opinions expressed at such hearing, and unless duly passed by the members of the Board of the Regional D i s t r i c t ; NOW THEREFORE THIS AGREEMENT WITNESSETH t h a t i n co n s i d e r a t i o n of the premises and co n d i t i o n s and covenants h e r e i n a f t e r set f o r t h , the Regional D i s t r i c t and the Developer covenant and agree as f o l l o w s : — Owner ]_# , i s the r e g i s t e r e d owner i n fee simple of a l l and s i n g u l a r those c e r t a i n p a r c e l s or t r a c t s of land and premises, s i t u a t e , l y i n g and being i n the K e t t l e R i v e r Assessment D i s t r i c t , and w i t h i n the Regional D i s t r i c t of Okanagan-Similkameen, and more p a r t i c u l a r l y known and described as: (Hereinafter r e f e r r e d to as the "lands".) Consents 2. The developer, has obtained the consents of a l l persons having a r e g i s t e r e d i n t e r e s t i n the land as set out i n the schedule p r e f a c i n g the consents to the use and development set f o r t h h e r e i n which consents are attached hereto. 3. THAT t h i s Land Use Contract i s issued pursuant to the p r o v i s i o n s of Sec t i o n 702A of the M u n i c i p a l Act and E l e c t o r a l Area Zoning Bylaw Number of the Regional D i s t r i c t . 4. The land i n c l u d i n g the surface of water and any and a l l b u i l d i n g s and s t r u c t u r e s erected thereon, thereover or t h e r e i n s h a l l be used f o r the purpose s p e c i f i e d i n Schedule "A" hereto and f o r none other. S i t t i n g 5. A l l b u i l d i n g s and s t r u c t u r e s s h a l l be con- s t r u c t e d i n compliance w i t h and according to the attached plan marked Schedule "B" and no b u i l d i n g or s t r u c t u r e s h a l l be constructed, r e - c o n s t r u c t e d , a l t e r e d , moved or extended upon the land except i n compliance w i t h the s p e c i f i c a t i o n s and the p l o t plan set out i n Schedule "B" hereto. Signs 6. No sig n s h a l l be erected upon the land or any b u i l d i n g or s t r u c t u r e thereon except those shown on the Plans and s p e c i f i c a t i o n s s et out i n Schedule "D" hereto. Parking C e r t i f - i c a t e s 7. Off s t r e e t parking and l o a d i n g spaces s h a l l be provided, l o c a t e d and constructed i n accordance w i t h the plan s e t out i n Schedule "C" hereto. 8. No development s h a l l take place on the s a i d lands u n t i l the Developer has obtained a C e r t i f - i c a t e of P u b l i c Convenience and Nece s s i t y or ten- t a t i v e approval i n w r i t i n g from the P u b l i c U t i l i t i e s Commission f o r the development or stage of develop- ment. Constru- 9. P r i o r to the commencement of any b u i l d i n g or c t i o n s t r u c t u r e a permit to commence such b u i l d i n g or s t r u c t u r e s h a l l be obtained from the Regional D i s t r i c t b u i l d i n g i n s p e c t o r and such permit w i l l not be issued u n t i l the acquirement of above s e c t i o n 8 have been met. Plans & 10. A l l b u i l d i n g s and s t r u c t u r e s s h a l l be con- Specs s t r u c t e d s t r i c t l y i n compliance w i t h and according to the plans and s p e c i f i c a t i o n s set out i n Schedule "D" hereto. Land- scaping 11. A l l landscaping, s u r f a c e , treatments, fences and screens s h a l l be constructed, l o c a t e d , provided and maintained i n compliance w i t h and according to the plans and s p e c i f i c a t i o n s set out i n Schedule "D" hereto. U t i l i t i e s 12. A l l u t i l i t i e s , i n c l u d i n g water, sewer, gas, telephone and e l e c t r i c i t y , s h a l l be placed, provided and constructed i n compliance w i t h and according to the plans and s p e c i f i c a t i o n s set out i n Schedule "E" hereto. Highways 13. A l l highways, b r i d g e s , lanes and walkways, i n c l u d i n g drainage, s u r f a c i n g , curbs, g u t t e r s , s t r e e t l i g h t i n g , boulevards and s t r e e t signs s h a l l be provided, l o c a t e d and constructed i n compliance w i t h and according to the plans and s p e c i f i c a t i o n s set out i n Schedule "F" hereto. Parks Refuse Sub- d i v i s i o n S e c u r i t y Payment Schedule Change Inspec- t i o n Penalty 14. A l l lands f o r p u b l i c i n s t i t u t i o n a l uses, parks, p u b l i c space, playgrounds or other r e c r e a t i o n f a c i l i t i e s , to be dedicated by s u b d i v i s i o n plan or otherwise provided, s h a l l be provided, constructed and developed i n compliance w i t h and according to the plans and s p e c i f i c a t i o n s set out i n Schedule 11G" hereto. 15. P r i o r to completion of any and a l l stages of the development, p r o v i s i o n s s h a l l be made by the Developer f o r i n c l u s i o n of the development w i t h i n a Regional D i s t r i c t Sub-Regional Refuse d i s p o s a l area. 16. No land s h a l l be subdivided except i n com- p l i a n c e w i t h and according to the plans and s p e c i - f i c a t i o n s set out i n Schedule "H" hereto. 17. The Developer s h a l l provide the Regional D i s t r i c t w i t h the s e c u r i t y set out i n Schedule " I " hereto to guarantee performance hereof. 18. Except as s p e c i f i c a l l y provided i n Schedule " J " hereto, the e n t i r e cost of the development of the land i n c l u d i n g the. .provision of a l l s e r v i c e s and the p r o v i s i o n and c o n s t r u c t i o n of the items set out i n paragraphs 6 to 14 hereof s h a l l be p a i d f o r by the Developer. 19. The Developer s h a l l c arry out the work and c o n s t r u c t , " l o c a t e , provide and develop the s t r u c - t u r e s , b u i l d i n g s , works, s e r v i c e s , developments and f a c i l i t i e s according to the times set out i n Schedule "K" hereto. 20. The p r o v i s i o n s of t h i s Agreement may be changed by a l t e r i n g , adding or deduction therefrom provided that the Regional D i s t r i c t and the Devel- oper and any other person or persons p r e s e n t l y having or subsequently a c q u i r i n g an i n t e r e s t i n the s a i d lands, to be e f f e c t e d by mutual consent i n w r i t i n g to such changes. 21. The Regional D i s t r i c t may at a l l reasonable times enter upon the lands and c a r r y out a l l necessary i n s p e c t i o n s to insure that the lands are developed and used i n accordance w i t h the p r o v i s i o n s of t h i s Agreement. 22. In the event of the breach of any term or p r o v i s i o n of t h i s Agreement or f a i l u r e by the Developer to comply w i t h , develop and maintain the lands i n accordance w i t h the p r o v i s i o n s of t h i s D e f i n i - t i o n Agreement, the Regional D i s t r i c t may without n o t i c e enter upon the lands and perform the development re q u i r e d by t h i s Agreement and the cos t of so doing s h a l l be a charge aga i n s t the lands and s h a l l be paid f o r by the Developer. 23. That i n the i n t e r p r e t a t i o n of t h i s Agreement a l l d e f i n i t i o n s or words and phrases contained i n the E l e c t o r a l Area Zoning Bylaw Number of the Regional D i s t r i c t , as amended from time to time, should apply to t h i s Land Use Contract and to the attachments hereto. Regis- 24. This Agreement s h a l l be construed as running t r a t i o n w i t h the land and s h a l l be r e g i s t e r e d i n the Land R e g i s t r y O f f i c e , Kamloops, B r i t i s h Columbia by the Regional D i s t r i c t pursuant to the p r o v i s i o n s of Sec t i o n 702A(4) of the M u n i c i p a l Act. Fee 25. That the Developer s h a l l pay to the Regional D i s t r i c t a l l costs i n c u r r e d i n the pr e p a r a t i o n and r e g i s t r a t i o n of t h i s Agreement and any amendments the r e t o . I n t e r - 26. That t h i s Agreement s h a l l enure to the b e n e f i t p r e t a t i o n of and be b i n d i n g upon the p a r t i e s hereto and t h e i r r e s p e c t i v e h e i r s , executors, a d m i n i s t r a t o r s , successors and assigns, and wherever the s i n g u l a r or masculine i s used h e r e i n , the same s h a l l be con- strued as meaning the p l u r a l , feminine or body corporate or p o l i t i c where the context of the p a r t i e s hereto so r e q u i r e . A p u b l i c hearing on t h i s agreement was held the day of , 197 on the day of members This agreement was approved c , 197 by a vote of a m a j o r i t y of a l l of the Regional Board. IN WITNESS WHEREOF the s a i d p a r t i e s to t h i s Agreement have hereunto set t h e i r hands and s e a l s the day and year f i r s t above w r i t t e n . THE SEAL of the Regional D i s t r i c t of Okanagan-Similkameen was a f f i x e d i n the presence of: Chairman A d m i n i s t r a t o r SIGNED, SEALED AND DELIVERED i n the presence of: Witness Address Occupation Schedule of permitted land use; The f o l l o w i n g uses and no others s h a l l be permitted i n accordance w i t h those uses i n d i c a t e d on the plan attached to Schedule "B": (a) A g r i c u l t u r e , s u bject to the f o l l o w i n g : (i) Except as provided by subclause ( i i ) , on any l o t or s i t e of l e s s than one-half (1/2) acre, only household pets are permitted and no horse, donkey, mule, hinny, cow, goat, sheep or p i g s h a l l be a household pet whether or not i t i s owned by occupants of the residence and not kept f o r remuneration, h i r e or s a l e ; ( i i ) On any l o t or s i t e , commercial kennels, s t a b l e s , mink farms, f e e d l o t s , p i g g e r i e s , or other s i m i l a r s e r v i c e or n o n - a g r i c u l t u r a l , product-based operations s h a l l be p r o h i b i t e d , save and except the r a i s i n g of fo w l , r a b b i t s , and other small f u r - b e a r i n g animals as a home occupation; ( i i i ) LIVESTOCK ( S p e c i a l P r o v i s i o n s ) : (A) On any l o t or s i t e of l e s s than two (2) acres, (i) the t o t a l number of horses, sheep, or other s i m i l a r l a r g e animals s h a l l not exceed one (1) f o r each one-half (1/2) acre or f r a c t i o n thereof of l o t or s i t e area i n excess of one-half (1/2) acre; ( i i ) the t o t a l number of fo w l , r a b b i t s , or other small f u r - b e a r i n g animals, or the number of col o n i e s of bees, s h a l l not exceed twenty- f i v e (25) plus one (1) f o r each f i v e hundred (500) square f e e t or f r a c t i o n thereof of l o t or s i t e area i n excess of one-half (1/2) acre. Notwithstanding subclause ( i i ) above, i n the case of c h i n c h i l l a s , the maximum number allowed on a l o t or s i t e l e s s than one h a l f (1/2) acre s h a l l not exceed f i v e hundred (500) w h i l e there are no r e s t r i c t i o n s to the number of c h i n c h i l l a s on l o t s i n excess of one h a l f (1/2) acre. (B) A l l l i v e s t o c k other than household pets s h a l l be p r o p e r l y caged or housed. (iv) The pr o c e s s i n g , packing, and s a l e of a g r i c u l t u r a l produce s h a l l be permitted, i n c l u d i n g f r u i t s t a n d s provided the f o l l o w i n g c r i t e r i a are met f o r these s t r u c t u r e s : (1) access permit has been obtained from the Dept. of Highways, and (2) are s t r u c t u r a l l y of sound c o n s t r u c t i o n w i t h a durable painted or p r e f i n i s h e d e x t e r i o r c l a d d i n g . (b) S i n g l e - f a m i l y d w e l l i n g s ; (c) Mobile homes provided they have a f l o o r area of not l e s s than seven hundred f i f t y (750) square f e e t and have a minimum width as o r i g i n a l l y designed and manufactured of not l e s s than s i x t e e n (16) f e e t and are placed on permanent foundations w i t h f u l l s k i r t i n g blending i n w i t h the u n i t . On s i t e s of f i v e acres or more i n area, or on the f o l l o w i n g numbered l o t s , , any mobile home or f a c t o r y b u i l t u n i t (f) home having a f l o o r area of not l e s s than four hundred and ei g h t y (480) square f e e t , s i t e d not l e s s than twenty-five (2 5) f e e t from any property l i n e s h a l l be permitted; (d) Home occupations, provided t h a t on any l o t or s i t e of l e s s than one (1) acre, the area used f o r home occupations s h a l l not exceed f i v e hundred (500) square f e e t ; (e) P u b l i c open-land r e c r e a t i o n a l and i n s t i t u t i o n a l uses, i n c l u d i n g parks, playgrounds and cemeteries; P u b l i c s e r v i c e or u t i l i t y b u i l d i n g s and s t r u c t u r e s , w i t h no e x t e r i o r storage of any k i n d and no garages f o r the r e p a i r and maintenance of equipment; (g) B u i l d i n g s and s t r u c t u r e s accessory to the uses permitted under clauses above. P l o t Plan and S p e c i f i c a t i o n s ; S i t e area The minimum s i t e area s h a l l be one h a l f acre. Density The maximum gross de n s i t y s h a l l be one l o t per acre. Gross acreages s h a l l mean the t o t a l contiguous acreage of land considered f o r s u b d i v i s i o n and held under the same ownership. Staging The proposed development s h a l l be i n four stages. Each successive stage s h a l l be allowed only when f i f t y (50) percent of the p r e v i o u s l y permitted l o t s have become developed and improved to the extent that c o n s t r u c t i o n of a d w e l l i n g u n i t has been s t a r t e d . Precau- Land s i t u a t e d i n areas w i t h high-hazard s o i l t i o n s s t a b i l i t y r a t i n g s s h a l l be subject to a s p e c i f i c s i t e r e p o r t by a q u a l i f i e d S o i l Engineer p r i o r to r e g i s t r a t i o n of s u b d i v i s i o n of such lands. Require- ments Setbacks f r o n t 25 f e e t rear 25 f e e t side 5 f e e t and 10 fee t r e s p e c t i v e l y f o r i n t e r i o r l o t s 15 f e e t f o r side yards a b u t t i n g a road S i t e Coverage — p r i n c i p a l and accessory b u i l d i n g s together s h a l l not occupy more than t h i r t y (30) percent of the l o t or s i t e . Height of B u i l d i n g and St r u c t u r e s ~ maximum twenty-five (25) percent of l o t or s i t e depth or 50 f e e t whichever i s l e s s . In no case s h a l l a d w e l l i n g exceed a height of t h i r t y (30) feet, Minimum f l o o r area -- No d w e l l i n g u n i t , f a c t o r y b u i l t u n i t home or mobile home on s i t e s l e s s than f i v e (5) acres s h a l l have a f l o o r area of l e s s than seven hundred f i f t y (750) sq. f t . Number of Uni t s - - N o t more than one d w e l l i n g u n i t s h a l l be permitted upon a l o t . Plan — See Plan Dated Schedule "C" Off S t r e e t Parking: T o t a l Area — Minimum three hundred s i x t y (360) sq. f t . Number of Spaces — Two (2) spaces per d w e l l i n g u n i t . S i z e of Spaces — One hundred eighty (180) sq. f t . per space. S u r f a c i n g ~ Op t i o n a l L i g h t i n g — N/A Signs — N/A Access — Every required o f f s t r e e t parking space s h a l l be so shaped and s i t e d as to provide convenient access to the premises and to a p u b l i c s t r e e t . Plan — N/A Off S t r e e t Loading: T o t a l Area - Si z e of Area Location S u r f a c i n g — L i g h t i n g Signs ~ Access -- N/A Plan -- made Subject to the Motor-Vehicle Act and the r e g u l a t i o n s (a) No signs or a d v e r t i s i n g d i s p l a y s s h a l l be permitted other than the f o l l o w i n g : (i) those denoting a home occupation; ( i i ) those denoting the name of the owner or the name or address of the property; ( i i i ) those a d v e r t i s i n g the s a l e or r e n t a l of property; (iv) those a d v e r t i s i n g the s a l e of a g r i c u l t u r a l produce grown on the same l o t or s i t e or land of the same ownership; (v) p u b l i c u t i l i t y and i n s t i t u t i o n a l s i g n s , provided that such signs s h a l l not exceed s i x (6) square f e e t i n area or e i g h t (8) f e e t i n length and s h a l l be l i m i t e d to one (1) f o r each s t r e e t frontage upon which the l o t or s i t e abuts, except that on any l o t or s i t e of l e s s than one-half (1/2) acre, signs l i s t e d under subclause (i) and ( i i ) of t h i s clause s h a l l not exceed one and one-half (1 1/2) square f e e t . i n area. (b) Notwithstanding clause ( a ) , one (1) sig n only a d v e r t i s i n g the s a l e of l o t s w i t h i n a r e s i d e n t i a l s u b d i v i s i o n , not exceeding f i f t y (50) square f e e t i n area or twelve (12) f e e t i n l e n g t h , may be erected. (c) Roof signs and i l l u m i n a t e d or f l a s h i n g signs s h a l l be p r o h i b i t e d . (d) No sig n s h a l l p r o j e c t over a p u b l i c right-of-way. B u i l d i n g s and S t r u c t u r e s : P r i o r to the commencement of any b u i l d i n g or s t r u c t u r e a permit to commence such b u i l d i n g or s t r u c t u r e s h a l l be obtained from the Regional D i s t r i c t b u i l d i n g i n s p e c t o r and a l l c o n s t r u c t i o n s h a l l be i n accordance w i t h the N a t i o n a l B u i l d i n g Code of Canada, 1970, and subsequent amendments t h e r e t o , except as such are a l t e r e d or deleted by the Regional D i s t r i c t . Landscaping, Surface Treatment, Fences and Screens: Plans N/A S p e c i f i c a t i o n s : (a) On any l o t or s i t e , no fence s h a l l be (i) more than s i x (6) f e e t i n height f o r th a t p o r t i o n of fence t h a t does not extend beyond the minimum re q u i r e d f r o n t yard setback l i n e on the l o t or s i t e ; or ( i i ) more than four (4) f e e t i n height f o r t h a t p o r t i o n of fence t h a t does extend beyond the minimum r e q u i r e d f r o n t yard setback l i n e on the l o t or s i t e . A l l landscaping, surface treatments, d r a i n s , d i t c h e s and u t i l i t i e s i n s t a l l a t i o n s s h a l l be developed and constructed so that minimum disturbance i s caused to the n a t u r a l environment, and adequate r e s t o r a t i o n methods s h a l l be employed should there be any such disturbance r e s u l t i n g from development or c o n s t r u c t i o n a c t i v i t i e s . U t i l i t i e s : Water — No d w e l l i n g u n i t s h a l l be constructed on the s a i d lands u n t i l the Developer has obtained, i n respect of the supply of water, a C e r t i f i c a t e of P u b l i c Convenience and Neces s i t y or t e n t a t i v e approval i n w r i t i n g from the P u b l i c U t i l i t i e s Commission f o r the development or stage of development. A piped water supply w i l l be provided to each d w e l l i n g u n i t . Standard F i r e Hydrants, s i m i l a r to Terminal C i t y Iron Works No. 7 0 f u l l flow w i t h two 2 1/2" o u t l e t s , w i t h a 4" u p r i g h t to d e l i v e r , w i l l be provided i n such a manner th a t d i s t a n c e s to any developable property s h a l l not be greater than 350 f t . Sewage D i s p o s a l -- P r i o r to the commencement of any construc- t i o n of a d w e l l i n g u n i t , the Developer s h a l l o b t a i n a permit issued pursuant to the P r o v i n c i a l Regulations governing sewage d i s p o s a l and pursuant to the Health Act of the Province of B r i t i s h Columbia. Refuse D i s p o s a l — A l l household refuse s h a l l be c o l l e c t e d and hauled on a weekly b a s i s to a Regional D i s t r i c t Refuse Di s p o s a l S i t e designated by the Regional D i s t r i c t . E l e c t r i c i t y — Each d w e l l i n g u n i t s h a l l be s e r v i c e d by e l e c t r i c a l power. P l a n s , S p e c i f i c a t i o n s and Locations — P r i o r to the i n s t a l - l a t i o n of any u t i l i t y l i n e s , a plan showing the l o c a t i o n of such l i n e s s h a l l be submitted to the Regional D i s t r i c t f o r approval. Highways, Bridges, Lanes, Walkways: Plans r e q u i r e d S p e c i f i c a t i o n s -- Approval by Department of Highways S t r e e t L i g h t i n g : Plans -- N/A S p e c i f i c a t i o n s — One four hundred (400) watt s t r e e t l i g h t s h a l l be provided at each of the two entrances to the lands on E a s t s i d e Road Boulevards: Plans -- N/A S p e c i f i c a t i o n s — N/A Signs: Plans ~ N/A S p e c i f i c a t i o n s ~ In accordance w i t h Schedule 'D' Schedule "G" Parks, P u b l i c Space and R e c r e a t i o n a l F a c i l i t i e s : C o n s t r u c t i o n -- None Lo c a t i o n -- See map attached to schedule "B" S i z e -¬ Development ~ None Fu r n i s h i n g — None Plans — N/A S u b d i v i s i o n Plans: P a r c e l s : Area — See map attached to 'Schedule B' Shape — Dimensions ~ Highways: Dimensions — Approval by Department of Highways Loca t i o n — No a d d i t i o n a l access onto Lakeside Road w i l l be permitted other than the two proposed i n Schedule "B" Alignment — Gradient — Schedule " I " Performance S e c u r i t y : Amount Performance Bond — $ Mortgage — C e r t i f i e d Cheque — Other — The amount of the Performance Bond i s based upon 200 l o t s at $100.00 per l o t , which may be reduced at the end of each year at the r a t e of $100.00 per l o t developed ( i . e . w i t h c o n s t r u c t i o n of a d w e l l i n g u n i t started) w i t h i n the previous year. The bond may be used f o r completion or enforcement of any terms or c o n d i t i o n s of t h i s c o n t r a c t , and to ensure compliance w i t h any bylaw of the Regional D i s t r i c t , i n c l u d i n g Noxious Insect c o n t r o l . Works and Services to be Maintained and Operated by the Developer: The Developer s h a l l be f u l l y r e s p o n s i b l e and s h a l l pay f o r the operation and maintenance of a l l on s i t e works and s e r v i c e s i n c l u d i n g water s e r v i c i n g , r e s e r v o i r s , parks, t r a i l s and r e c r e a t i o n a l f a c i l i t i e s . Schedule "K" Development and Service to be provided or p a i d f o r by the Developer: The e n t i r e cost of the development of the l a n d , i n c l u d i n g the p r o v i s i o n of a l l s e r v i c e s , s h a l l be p a i d f o r by the Developer. NO EXCEPTIONS Appendix D. 1973 - SUBDIVISION PLAN UNDER LAND USE CONTRACT Scale l" = 2 0 0 ' SKAHA +

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