The provincial government has announced a $500,000 contribution to a fund that’s meant to provide a measure of financial protection to contractors involved in the growing and harvesting of trees.
The money is meant to compensate those companies if their customers, called “licensees,” become insolvent and can’t pay for services rendered.
By the end of April, the compensation fund, which was first established in 2012, had dished up nearly $485,000 — payments that were related to “three small insolvencies,” according to a government media release.
The newly announced money tops up the available funding, bringing it to roughly $8 million.
Minister of Forests Doug Donaldson announced the cash injection during a logging industry trade show and conference that took place in Kamloops earlier this month.
He called forest-service contractors “an extremely important link in the B.C. forest sector supply chain” and said the money would offer them confidence “despite any possible licensee insolvency.”
Protections extends to silviculture
The fund was originally meant to safeguard the interests of logging contractors and related service providers. But in December 2016, the government broadened the scope of the fund, making it available to companies involved in the growing of trees.
Those companies can apply for relief funds from a “silviculture sub-account.”
The newly announced funding is meant to benefit both the timber and silviculture contractors. “This one-time grant will be split evenly, with $250,000 going to the general fund and to the silviculture sub-account,” according to the government statement.