Forest Sector Prosperity Fund

The Forest Sector Prosperity Fund (FSPF) will provide a total of $150 million in conditional grants to the forest sector over three years. The funding grants will be issued to the forest industry to support and leverage new capital investment projects in:

• value-added manufacturing
• improved fibre efficiencies
• energy conservation and co-generation
• load management and electricity generation from biomass
• advanced materials handling/efficiencies
• new environmental technologies
• associated infrastructure needs (such as hydro lines, rail lines, etc.)
• worker training for transition to forest sector skill sets

Applicants may seek project support under either the FSPF or the Loan Guarantee Program (LGP) or both. FSPF will target projects which:

• are undertaken in forest industry dependent communities
• include Aboriginal involvement
• ensure and extend the viability of existing operations or establish new facilities targeting emerging markets
• successfully address energy issues faced by facilities

Priority for consideration will be given to projects with demonstrable contributions to the socio-economic health of northern or rural Ontario, to the sustainability of the forest industry, and to enhanced diversification of the forest sector.

Eligible projects:

• Restricted to projects for the purposes outlined above
• Restricted to sites in northern or rural Ontario. (Rural Ontario includes all of Southern Ontario excepting seven major urban areas; The Greater Toronto Area, Hamilton, London , Niagara Region, Ottawa, Waterloo Region and Windsor. In Niagara and Waterloo Regions, areas outside the urban centres with a population of less than 100,000 are considered rural)

Applicants can seek support for more than one project, and the FSPF contributions may only be used for new investments and may not be used to retire existing loans (including a government-guaranteed loan) held by the applicant.

Conditional grant applications will undergo an assessment based on the program criteria. The process for evaluating applications for proposed projects is below:

1. Preliminary discussions between prospective applicant and the Ministry of Natural Resources (MNR) to provide necessary information for application requirements and directions. (see contact information below)
2. The application is submitted to MNR. Application includes:
   

    

   • Description of proposed project
   • Business Case
   • Legal Compliance Declaration 
      
3. MNR's Forest Sector Competitiveness Secretariat undertakes technical review and evaluation of the proposal.
4. Project referred to 3rd party due diligence for review and comment on: 
   

    

   • Description of proposed project
   • Business Case
   • Legal Compliance Declaration 
   • Other government assistance programs that may also be eligible sources
   • Recommended terms and conditions for funding assistance 
     
     
5. MNR brings proposal forward to Forest Prosperity Fund Approval Committee for a recommendation on funding. The Committee may recommend:Application includes:
   

    

   • Suggested level of funding; or,
   • Alternative level of funding; or,
   • No funding 
     
     
6. Approval by the Ministers of Natural Resources and of Finance.
7. MNR and the applicant enter into a conditional funding agreement.
8. Applicant submits progress reports as per agreement.

Some of the specific terms for the program are as follows:

• Qualifying individual projects will normally have a minimum investment of $2.5 million.
• Individual grants will not exceed a maximum of 20% of the project value; however, electricity projects will be eligible for up to an additional 10% (a maximum of 30%).
• The maximum grant available is $25 million.

Please direct your inquiries to:

Loretta Alexander at loretta.alexander@ontario.ca

Phone: (705) 945-6765

Fax: (705) 945-6796