Reformed Economic Development Corporation sructure raising some eyebrows. More to be said about how they will operate.

By Staff

July 16, 2014

BURLINGTON, ON.

John Sweeney has said he will not be running for office even though he blew $100 to nominate himself as a council member in ward 4.  He hasn’t withdrawn – yet.  He wants to keep his name out there and be able to comment on what he feels are matters of interest – and he certainly has things to say about the structure of the new Economic Development Corporation.

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Sweeney asked Mayor Goldring and Ward 4 Councillor Jack Dennison to comment on several questions:

Here is what they had to say:

Sweeney points out that “they did not answer all of the questions. They did some of the politician “side-step” or just answering the portion of a question that they wanted to instead of just answering in its entirety.  They do however confirm that the Board of the BEDC will be compensated and the costs will increase but they are not sure by how much.

Dennison points out that he, Councillor Sharman, the Mayor, the city manager and General Manger Scott Stewart will sit on the board – Stewart will not have a vote.

“The burning platform, according to Dennison “is the fact that Burlington is the slowest growing city in the GTA and the oldest city.

As a result, our increase in assessment growth is projected to be .50% in 2014 compared to 1.5%, 3 years ago and 3% 10 years ago.

This slow growth, if not acted upon, will create tax rate increases higher than we would like and service reduction as well.

In addition any additional growth we can get from the ICI Sector pays approximately double what residential pays for identical assessment, while generally not putting additional strain on infrastructure.

Sweeney wanted to know:  Why the rush to get this done? Is there a phased option? Repurpose BEDC right now and then spend some more time on the specifics of the hold/devco options. The current budget for BEDC is established and approved why not wait until next year and makes this part of the OP and also secures the support of the Council in place after the election since they will be executing it.

The response:  The new BEDC will be a more structured, focused and purposeful organization that will take some time to transition.

Councillor Jack Dennison sits on the board of the reformed Economic Development Corporation – expect him to urge that they be both direct and aggressive.

First, get the new board and CEO in place. Secondly, focus on more aggressive strategies around attraction and retention and then pursue development opportunities that could include land banking and partnering with developers

Why is it “For Profit”? Why not a “Non-profit” structure?

 We want BEDC to have the potential to act as a developer if necessary. That does not mean that BEDC has to generate profits no matter what.

If the end result is to have a Servco capability, this could save tax payers money and potentially have a for profit component that could also reduce the continual strain on the city operating budget.

3/ Is there an increased cost? Different skill sets, higher salaries, more people?

Yes – although the specific details are yet to be clearly defined.

4/ Is the current BEDC Board compensated? Will the new BEDC Board be compensated? How much? Will the members of the interim board be eligible for the new board?

The governance of the new BEDC will be created similar to Burlington Hydro which does pay directors. Last year, directors were compensated in the $10 – $12k range.

 5/ Who will have the “controlling” interest on the board of directors?

The board will report to council in the same way Burlington Hydro reports to council.

There will be 3 reps from the city on a board including the City Manager or designate, Mayor and one Councillor.

6/ How will we measure and ensure that we focus on economic development and jobs instead of making profit for the various “ventures”?

The focus will be on jobs and assessment growth. Making “profit” could be a secondary outcome.

7/ If I am a private developer that does not want to/need to work with BEDC Inc., am I at a disadvantage? How will I be supported? Do I have to pay for it?

Mayor Rick Goldring may find himself talking to a lot of business people about the new economic development corporation.

Absolutely not. The role of BEDC will be to guide developers through the process. In fact, I see the potential for a rep from BEDC to literally knock on doors of landowners to advise them of the tremendous potential they have and offer to help.  Existing, aging strip malls are a classic example of an opportunity to rezone as mixed use with retail and office below and residential above, all using existing services.

 8/ Is it really appropriate to have allow this organization to spend up to $1,000,000 without going to council?

Currently the budget of BEDC is over $1 million so they can spend their budget the way they see fit.  Another view was that the budget approval does have a level of specifics and Council is expecting that funds be spent with-in those guidelines.

Expect to hear more on this once the public, particularly the business community gets a clearer idea as to just what is happening at BEDC.  Executive Director (why didn’t’ they make him president) Frank McKeown has his work cut out for the next few months getting some clarity out into the public realm.