BCAdvantage 2008; Business and investment across British Columbia

Nestled into the southeast corner of British Columbia, the Kootenay region is bordered by Alberta to the east and Montana, Idaho and Washington to the south. East Kootenay lies in the north-south trench between the Purcell Mountains and the Canadian Rockies, and West Kootenay lies between the Purcells and the Monashees.

Covering approximately 7.6 million hectares (8% of the province), there are 27 organized municipalities, the largest being Cranbrook with a population of 18,267. The total population for the region is 157,000 (3.8% of the provincial population).

“Even though we are divided by geography,” said Diana Brooks, executive director of the Kootenay Rockies Regional Economic Alliance, “our areas are working together facing the same issues. There’s a greater collaboration and exchange of information.”

The region’s strong transportation infrastructure connects the Kootenays to major centres including Calgary, Spokane, Kelowna and Vancouver. Two major highways (the Trans-Canada and the Crows Nest) traverse the region east to west. Rail access includes the main east-west trans-continental line for CPR with branch lines heading south and two rail links directly servicing the United States. Daily scheduled air service from Cranbrook and Castlegar to Vancouver International Airport and Calgary International Airport provide ready access to domestic and international carriers. The expanded runway and services at the newly renamed Canadian Rockies International Airport in Cranbrook will allow larger aircraft and international flights directly.

The economy is primarily resource based with coal, minerals, forest products, hydro-electricity and tourism being the main economic sectors. In recent years, small but vibrant manufacturing and technology sectors have emerged. Primary resource companies account for half of the top 20 companies based on gross revenues. Elk Valley Coal Corp. and Teck Cominco are by far the largest with revenues in 2006 of $1.84 billion and $1.80 billion respectively.

The tourism sector generates approximately $1 billion in revenue with dramatic growth in major all-season resorts under development and 10 new championship golf courses constructed or currently under development. The region’s agricultural industry is primarily ranching although Creston Valley is a major fruit tree and produce production area.

The Kootenays were the perfect location for D-Pace to set up shop. With its head office in Nelson, D-Pace provides engineering design services, custom products and TRIUMF-licensed products to the commercial particle accelerator industry. Revenues have doubled each year over past years, surpassing $1 million in 2007. In 2007, it won a National Sciences and Engineering Research Council of Canada Synergy Award, together with TRIUMF, in the category of a small company teaming with a university partner.

“D-Pace and its staff enjoy very much working from Nelson,” said company president Morgan Dehnel. “We have all the business services we require within a five-minute walk from our office. It is a beautiful area with a substantial selection of interesting cultural and entertainment activities, and the price of housing is more affordable than those of most major centres.”

In fact, he said, although Nelson is widely known as a hub for people in the arts community, it is less well-known that this contributes significantly to a draw of young technology workers to the area, “which D-Pace draws upon both for direct staffing, and indirectly for freelance: engineering, technical writing, web development, graphic design, marketing consulting, business consulting, translation services…”

Though it might be a draw for some, KRREA’s Brooks said that, as with the rest of the province, the shortage of labour is a big issue, particularly in small communities. Yet the region is seeing an influx of investment on several fronts, coming from Alberta, overseas as well as from the Okanagan and Lower Mainland.

“The Kootenays is certainly an area being looked at, and we are starting to see an increase in investment beyond traditional recreation,” said Brooks. “Each area is seeing different advances in investment depending on who shows up and gets it going.”

Big news includes real estate, recreational and resort development in the east, and strong construction and burgeoning retail sectors throughout. “Growth used to be concentrated in sub-areas,” she added, “but now is throughout the entire region. It’s beyond straight real estate growth. Now we’re seeing investment in business growth, the purchase of existing businesses and the creation of new businesses to respond to market needs.”

Lifestyle issues, combined with economic opportunities, attract both investment and new people to the region. “We continue to build a strong economy here that favours entrepreneurs and other types of businesses.”

Paul Wiest agrees. The general manager of Community Futures Central Kootenay says his region has seen continued growth in tourism despite the Canadian dollar being as strong as it has been. Related is the development of real estate. As people come to visit, they want to stay.

“There’s been a lot of primarily condo development,” he said. “Some larger vacation homes are being developed; upgrading and building new homes. A lot more than I’ve seen in the past 10 years.”

The other piece of the puzzle, he said, is the small but growing cluster of small technology companies. He mentions Pacific Insight, a manufacturer of electronic components, as a success story, employing 300 people.

“Larger companies – [such as] Teck Cominco – had another very strong year,” he said. “But the continued strength of the housing and construction market surprised me the most.”

The forestry sector has seen large losses, he said, partly because the market has been flooded with pine beetle lumber, driving prices down.

“Small single industry towns are feeling the pressure … particularly in log harvesting,” he said. “The mill in Grand Forks and Castlegar are affected as well as the pulp mill in Castlegar. We’re looking at that challenge.”

Help is coming. The Southern Interior Development Initiative Trust’s purpose is to support economic development in the Southern Interior. Created by (but not an agent of) the B.C. government with an initial allocation of $50 million, its primary tools are grants, loans and equity investments which support long lasting regional strategies in economic development including job creation, economic diversity and an increased tax base.

It focuses on 10 sectors: forestry, mining, energy, tourism, agriculture, 2010 Olympic opportunities, economic development, transportation, small business, and Mountain Pine Beetle recovery.

“Into the fourth quarter of our first year, we have dispersed, in effect, nothing, but we have committed $225,000 with another $2 million to $3 million earmarked for dispersal in the next one to two months, subject to various conditions being met,” said Ron Baker, CEO of SIDIT.

Simply put, he said, the projects with the most merit get funding. The trust is able to tap into the local sense of what is needed and what will work. It is the vehicle to get funding out there, driven by need and local opportunity. “We support sustainable economic development,” said Baker. •

Kootenay

•Castlegar

•Cranbrook

•Creston

•Fernie

•Grand Forks

•Invermere

•Kaslo

•Kimberley

•Nakusp

•Nelson

•New Denver

•Radium Hot Springs

•Rossland

•Slocan

•Sparwood

•Trail

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