1999/00 CAPITAL PLAN

Borrowing for capital projects finances the building of schools, hospitals, roads, and other forms of provincial infrastructure. These investments provide essential services for today and will also benefit future generations of British Columbians.

The need for capital infrastructure in British Columbia is substantial. Maintaining the existing asset base, replacing aging infrastructure, and meeting the needs of a changing population all require capital spending. Capital investments also help to create economic activity in the province.

The following table summarizes capital expenditures for 1998/99 and 1999/00.

	1998/99 Budget Estimate		1998/99 Revised Forecast		1999/00 Budget Estimate
			($ millions)
Education1	423.2		450.0		468.1
Health2	222.0		150.0		358.9
BC Transportation Financing Authority	350.1		378.1		489.4
BC Ferry Corporation	85.0		160.0		139.0
Rapid Transit Project 2000	—		248.6		410.0
Other3	165.8		104.0		87.1
	1,246.1		1,490.7		1,952.5
1 Represents Ministry of Education, and Ministry of Advanced Education, Training and Technology. 2 1999/00 estimate includes $100 million to address regional Year 2000 equipment and systems issues. 3 Represents British Columbia Buildings Corporation, British Columbia Transit, Ministry of Attorney General, and Ministry for Children and Families.

 
Cost Containment and Efficiency Measures

Government continues to work on improving the planning, construction, and maintenance of provincial infrastructure by:

• developing program delivery models which require less capital investment;

• maximizing the use of existing assets;

• acquiring capital in the most efficient and cost-effective manner possible; and

• pursuing alternative financing options.

Examples of cost containment strategies in 1998/99 include:

• $70 million through increased utilization of existing space in the post-secondary system;

• $10 million over 10 years on capital equipment purchases through increased utilization (extended daily service hours) of diagnostic and treatment equipment; and

• over $15 million through value analysis and value engineering of highway projects.

In 1998/99, the government implemented further improvements by reorganizing the way social capital projects were delivered. While needs assessment and forward planning remained the responsibility of individual ministries, project management, financing, and delivery were consolidated in the Ministry of Finance and Corporate Relations. As a result of this reorganization, a number of savings totalling approximately $70 million were achieved including:

• repeat use of school designs;

• alternative procurement methods and strategic tendering of projects;

• facility unit rate changes (i.e. reduced costs per square metre); and

• facility area changes (i.e. reduced size of facilities).

 
Review of 1998/99 Capital Spending

In 1998/99, approximately $1.5 billion was spent to finance capital projects including the building of schools, hospitals, roads and other forms of provincial infrastructure. Expenditures were up from the $1.25 billion budget primarily due to increased spending for fast ferries and accelerated construction of the SkyTrain extension.

Specific examples of projects undertaken in 1998/99 include:

• funding to construct 19,400 new spaces for children in the kindergarten to grade 12 system;

• new radiology equipment purchases and renovations for Vancouver General Hospital Radiology and Trauma Special Care Unit;

• construction of the replacement tower for Surrey Memorial Hospital;

• phase 2 replacement of Richmond Hospital;

• completion of Priory Hospital multi-level care facility in Victoria;

• construction of a new health care centre and multi-level care facility in 100 Mile House;

• upgrade of Bulkley Lodge long-term care facility in Smithers;

• replacement of Normanna Rest Home multi-level care facility in Burnaby;

• additions and renovations to Royal Arch Masonic Home in Vancouver;

• road improvement projects (e.g. rehabilitation, passing lanes and highway realignments) throughout the province;

• continued construction on the Vancouver Island Highway;

• widening of the Trans Canada Highway from Hospital Road to 30th Street in Salmon Arm and from the Tumbleweed Interchange to Senora in Kamloops;

• construction of Trans Canada Highway high occupancy vehicle lanes in Burnaby;

• 4-laning of the Lougheed Highway in the Albion area of Maple Ridge; and

• purchase of 40 Mark II vehicles for Phase 1 of the SkyTrain expansion.

 
1999/00 Capital Spending

During 1999/00, government will make capital investments of approximately $1.95 billion. Projects include:

• funding to construct 13 new schools and 100 additions which will create 480 classrooms for kindergarten to Grade 3 students to reduce maximum class sizes, and will reduce the number of existing portable classrooms by about 560;

• construction of the Vancouver Island Cancer Centre;

• replacement of West Coast General Hospital in Port Alberni;

• funding to address regional Year 2000 equipment and systems issues in the health sector;

• construction of the North Fraser Pretrial Centre in Port Coquitlam;

• continued construction of fast-ferries;

• road improvement projects (e.g. rehabilitation, passing lanes and highway realignments) throughout the province;

• continued construction on the Vancouver Island Highway;

• construction of a new ferry to operate on Kootenay Lake (Balfour);

• construction of the Nordel Way Extension (Delta/Surrey);

• rehabilitation of the Lions Gate Bridge;

• realignment of Highway 1 through Sumas-Vedder (Abbotsford);

• 5-laning the Port Mann Bridge and associated improvements to the Cape Horn Interchange;

• twinning the John Hart Bridge over the Nechako River in Prince George;

• upgrading the Nisga'a Highway and construction of the Greenville to Kincolith Access Road;

• improvements to the Trans Canada Highway between Cache Creek and the Rockies, including the Monte Creek Interchange (Kamloops);

• construction of an interchange at the intersection of Highway 97 and Glenrosa in Westbank;

• purchase of additional and replacement buses in Victoria and other municipal systems; and

• construction of the guideway for Phase 1 of the SkyTrain expansion.

The province will also invest an additional $186 million to expand the Vancouver Trade and Convention Centre. This amount may be reduced if a cost-sharing arrangement is concluded with the federal government.

 
Reporting

During the year, the province publishes quarterly reports as part of its commitment to provide regular public updates on the government's finances. These reports include information on the debt of the provincial government and its Crown corporations and agencies, and provide updates on capital plan expenditures.