By Pepper Parr
December 5th, 2024
BURLINGTON, ON
The item was on the consent agenda, which meant it wasn’t supposed to get any attention.
No one asked the CAO to speak to his report.
And not a single member of Council asked a single question of CAO Hassaan Basit. It was, unfortunately, a missed opportunity
Burlington’s growing and evolving economic and tourism landscapes necessitate a critical examination of how the City delivers and governs these services. Currently managed by independent boards, as part of the City’s Agencies, Boards and Commissions (ABCs), Burlington Economic Development (BED) and Tourism Burlington have historically provided adequate flexibility and autonomy to respond to local business and tourism needs.
However, changes in legislation over the years, increased economic complexity, a growing and changing population, and evolving City priorities present an opportunity to assess whether the current model continues to serve the community optimally.
A recent announcement from Halton Region indicates a shift of its economic development services to local municipalities which means a reevaluation of Burlington’s current approach. This presents both challenges and opportunities.
A periodic review of this nature helps ensure the City remains competitive, accountable, and capable of meeting stakeholder expectations.
Staff will be undertaking a review to evaluate the current structure, effectiveness, and potential integration of BED and Tourism Burlington into the City’s governance framework. This review will consider alignment with City goals, operational efficiencies, stakeholder needs, and transparency. Three potential pathways are outlined:
maintaining the status quo,
conducting a third-party review,
or proceeding with integration.
The ABC model was adopted historically to navigate restrictive legislation under the Municipal Act, which limited municipal involvement in economic development activities. These limitations included restricting the ability of municipalities to engage in certain activities that could be seen as business-related, including offering direct incentives or engaging directly in economic development activities that competed with the private sector.
These restrictions made it necessary for municipalities to operate their economic development arms externally through separate entities and, specifically to economic activities at the time, this structure offered several advantages:
- Operational Flexibility: ABCs could move more freely in responding to business needs and economic opportunities without being bound by the rigid constraints of municipal governance processes.
- Governance Autonomy: By being arm’s-length from the municipality, ABCs were seen as more able to work closely with private-sector partners and advocate for economic opportunities.
- Avoiding Legal Restrictions: The Municipal Act at the time limited municipalities from engaging in what was deemed “commercial enterprises” or providing certain types of financial incentives to businesses. ABCs provided a legal workaround by being separate entities, not directly bound by these restrictions.
Over time, legislative changes have allowed municipalities greater leeway in managing their own economic development. In particular, changes to the Municipal Act and the introduction of new regulations such as the Ontario Regulation 599/06 (Municipal Services Corporations) enabled municipalities to directly take on economic development activities.
In 2023, the City of Burlington initiated a comprehensive review to enhance its relationships with ABCs and Joint Ventures (JVs), with a focus on accountability, governance, and alignment with City objectives.
A sleepy little office with a collection of brochures.
A significant development during this period was the proposed merger of Tourism Burlington and BED into a single independent ABC. This merger, was guided by the Joint Board Governance Steering Committee formed in late 2023. Milestones included a September 2023 Letter of Intent between TB and EcDev to explore governance integration, Council’s November 2023 receipt of an updated strategy report, and February 2024 discussions on shared operations and marketing.
There was also a Council directive in March 2024 to expedite the merger by January 2025 in order to deliver the Municipal Accommodation Tax (MAT) program (Local Board Governance – Merger of Tourism ).
In January 2025, Halton Region will cease providing economic development services, except for its Small Business Centre, transferring responsibility for these programs to local municipalities. This decision stems from legislative changes, including Bill 23 and the Cutting Red Tape to Build More Homes Act (Bill 185). These acts have reshaped the responsibilities of Halton Region, transitioning it to an upper-tier municipality without planning duties and emphasizing local governance for services connected to economic development and land use planning.
The transfer is part of a broader regional service transition plan developed collaboratively with local municipalities, ensuring local needs guide economic development efforts.
Population growth expected to take place in the Region.
Burlington is also experiencing steady population growth and is projected to see a continued rise in residents through 2051. As of 2021, the population was approximately 186,948, reflecting a 2% growth from 2016. This trend is expected to continue, driven by regional development plans and increased housing demands, and by 2051, Burlington’s population is expected to grow by over 40 percent.
These demographic shifts highlight the increasing demand for cohesive economic development and tourism strategies, making it essential to ensure the governance structure supporting these efforts remains agile and aligned with the city’s evolving needs. A review of Burlington’s Economic Development and Tourism framework would provide a critical opportunity to address these trends strategically and ensure that services are equipped to support long-term growth and community development.
Strategy, Process, and Risk:
The City recognizes the dedication and expertise of the current volunteer boards and their significant contributions to the objectives of Economic Development and Tourism. This review is not a reflection on the performance of the boards or staff but is intended to identify opportunities for improvement and future growth.
City staff will be commissioning a neutral, third-party review to analyze the following (this list is not exhaustive and can include additional areas of analysis):
-
- Historical and Legislative Context: Assessment of how legislative changes have created opportunities for in-house models.
- Service and Strategic Alignment: Evaluation of current services that BED and Tourism Burlington offer and their alignment with City priorities.
- Resource Allocation: Analysis of cost efficiencies, staffing optimization, and reduction of duplication.
- Comparative Analysis: Lessons learned from other municipalities transitioning to in- house models.
- Operational Feasibility: Examination of functions like procurement and TechPlace’s role in a restructured framework.
- Stakeholder Perspectives: Inclusion of feedback from businesses, tourism partners, and residents.
- Governance Options: Exploration of potential governance structures to support ongoing community involvement.
Options Considered:
Option 1: Maintain the Status Quo
Maintaining the current ABC model without initiating a review or pursuing integration retains the existing structure and operational practices.
Option 2: Conduct a Third-Party Revie
Commissioning a neutral, evidence-based review provides a balanced and informed approach to evaluating the current structure, understanding its strengths and gaps, and exploring the feasibility of alternatives, including integration.
Option 3: Proceed with Integration Directly
Moving forward with the immediate integration of BED and Tourism Burlington into the City’s governance framework without conducting a review.
Among these three options, maintaining the status quo provides stability but risks failing to address pressing issues of alignment, accountability, and efficiency. Proceeding directly with integration carries significant risks of missteps and operational disruption due to the lack of a thorough understanding of existing challenges and opportunities.
Conducting a third-party review stands out as the most prudent and strategic option. It allows the City to assess the current state comprehensively, consider stakeholder perspectives, and make data-driven decisions about the optimal structure for Burlington’s economic development and tourism efforts. This balanced approach ensures Burlington remains future-ready while upholding transparency and accountability to its residents, businesses, and stakeholders.
Staff have budgeted a maximum of $50,000 for a third-party review and report. Funding is included in the 2025 Corporate Affairs budget.
Hassaan Basit: This evidence-based approach ensures decisions are aligned with Burlington’s goals of transparency, accountability, and sustainable growth.
Burlington has the ability to assess the most effective approach to its economic development and tourism functions. While the current economic development and tourism efforts seem to be generally effective, evolving legislative, operational, and strategic priorities warrant a thoughtful review. Conducting a third-party assessment offers the City an opportunity to identify strengths, address gaps, and explore the feasibility of integration without committing prematurely to structural changes. This evidence-based approach ensures decisions are aligned with Burlington’s goals of transparency, accountability, and sustainable growth. By proceeding carefully, Burlington can position itself to meet future economic and tourism challenges effectively while maintaining the trust of its stakeholders.
Freeman Station
What the report, written by CAO Hassaan Basit, doesn’t include is pulling the Cultural arms into the mix.
The Performing Arts Centre and the Museums of Burlington serve the community and draw tourists to the city. What could also be included is the Freeman Station – if the city ever gets around to finding the keys to open the doors to the public.
Related news story:
Burlington doesn’t rank all that well on the culture scale.
This could be a good thing for Freeman Station. If run as a business rather than a museum it would be a going concern today, rather than being mothballed awaiting its fate.