Rosenberg talks education, energy in Canada visit

  • State Sen. Stan Rosenberg says the province of Quebec is likely looking ahead at the $1.2 billion improvement of rail service connecting Boston to Montreal through Springfield. AP PHOTO


For the Gazette
Published: 8/25/2016 1:36:40 AM

When Senate President Stanley Rosenberg of Amherst traveled to Quebec recently for a conference to work out cooperative programs between Massachusetts and the Canadian province on a range of issues including higher education and business collaboration, he brought back several pieces of good news.

Among these were the possibility for direct flights to start between Boston and Quebec City in the next two years and establishment of a Collaborative Research Council to foster universities to work together on genome research and other areas, according to Rosenberg, who co-chaired the conference with Quebec National Assembly President Jacques Chagnon.

Rosenberg came back from this third Montreal conference, held Aug. 10 to 13, with a fourth session planned for October in Boston, with his mind spinning from how well the province has done for itself, including getting its state-owned Hydro-Quebec to the point of providing 98 percent of the province’s electricity as well as selling power to other Canadian provinces — and Vermont and potentially, Massachusetts.

The state’s recently signed energy legislation that calls for procurement of 1,600 megawatts of offshore wind and hydropower, and Hydro-Quebec — the world’s fourth largest hydropower producer, expects to be a player here, said Rosenberg. The public utility has also expanded into telephone and internet service, extending service into the giant province’s hard-to reach pockets, he said.

“It was pretty amazing to hear how their 40-year visions (toward making Quebec energy independent) are coming to fruition.” In the area of transportation, he learned of work being done over the past three years on electrification of trains and buses, Rosenberg said, with a pilot project over the next three years to coordinate that system to possibly offering ideas for the troubled Massachusetts Bay Transportation Authority.

More staggering still for Rosenberg was Quebec’s $254 billion public retirement system, where the province’s “rainy day” reserve fund totals a staggering $8 billion that generates $450 million for the state’s operating budget.

“Their rainy-day fund is not just a fund for when it ‘rains,’” said Rosenberg, contrasting it with the Bay State’s current $1.3 billion, which Massachusetts has managed to gradually build to maintain its high bond rating, and which had reached $2.3 billion at the start of the 2008 recession. “It’s a moneymaker for them, and they haven’t touched (the principal) since they put their finances back in order … and created a new scheme for how to do this.”

Instead of the Massachusetts model, where the rainy-day fund is invested by the state treasurer, he said, Quebec’s fund is invested by the retirement system.

With $254 billion in assets, that retirement system plans to build a new $3 billion train line — paying for planning and construction of the project itself, said Rosenberg.

“It’s vertical integration from financing to construction, then they’ll turn it over” to the province,” said Rosenberg, who guesses that Quebec officials were showing off their plans because they hope also to invest in Boston’s long-stalled rail link of its North and South train stations, estimated at $3 billion.

What’s more, Rosenberg said, the province is likely looking ahead at the $1.2 billion improvement of rail service connecting Boston to Montreal through Springfield.

“I’m sitting there watching this, thinking, ‘Wait a minute: How does this province” — whose population of 8 million isn’t that much larger than Massachusetts’ 6.7 million — “end up with an $8 billion rainy day fund, which contributes almost a half-billion dollars a year into the operating budget, because they don’t have to even touch the rainy-day fund? And they just keep building it. And how does a pension system do a $3 billion train project for Montreal, and then want ... financing and building our north-south railway? And a few years later, after that, they want to do $3 billion project in Massachusetts, even if they screw up a project and have to eat it ... . It’s a whole different way of thinking.”

While Rosenberg marveled at what he called “such impressive, very strategic thinking and how they integrate things,” and criticized Massachusetts’ “siloed” approach, he acknowledged that the way provincial government in Canada is set up is entirely different.

Yet, he added, “That sophisticated public management thinking behind how they’ve dealt with their financial problems have come out of it to have that enormous strength,” is anything butprovincial.


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