Desperately Seeking A New Way Of Looking At Economic Development

By August 27, 2014Issues, Mike Archer

By Mike Archer. For years a small but vocal number of local business people have been complaining about the City of Abbotsford’s approach to economic development.

While the Abbotsford Chamber of Commerce and the majority of the members of council have blissfully spent, borrowed or committed hundreds of millions of dollars to nonsensical vanity projects, overpasses somebody else should have paid for and multi-year tax breaks to attract whatever new business they can desperately sell the farm in order to convince to move invest here, some of us have been arguing that Abbotsford should make the city a desirable place to do business first and then go out and find the kind of employers we want.

I know; ‘Naysayers’, ‘Party Poopers’, ‘Anti-Economic Growth’ … and lots of other names we can’t publish.

Let’s look at Abbotsford’s approach to Economic Development over the last decade and where it has got us.

Abbotsford’s Approach To Economic Development
Rather than upgrade a water and sewer system which does not have the capacity to deliver services to new businesses and housing development, we gave tax breaks to developers in order to make it irresistible to move here.

To understand the folly of Abbotsford’s approach to economic growth one has only to look at Highstreet Mall – Why Did Council Give Away The Farm On Highstreet Mall?

And from all accounts, the merchants of Highstreet (along with the taxpayers) are the ones suffering. The mall owners are happily collecting their rent cheques while the shop owners are experiencing slower than hoped for sales while the taxpayers are footing the bill.

Why is that?

It’s because Abbotsford has been mainly attracting the low lying fruit in the economic development world – warehouse, minimum wage paying companies who locate here because we are:
a) Close to the border
b) Close to Vancouver
c) On the TransCanada Highway
d) Have an airport
e) Are cheaper than any other city in the Lower Mainland

Our Water And Sewer Pipes Are Simply To Small
With infrastructure which cannot accommodate any serious economic growth we decided to fake it by spending, borrowing and committing half a billion dollars to the building and maintenance of a giant hockey rink which no one in the community can use except an out-of-town NHL farm team from Calgary to which we promised taxpayer dollars to guarantee they and their local owners wouldn’t lose money.

The Chamber of Commerce cheered the initiative, the newspapers cheered the initiative and the smart money left town because it knew that an empty arena doesn’t make up for the lack of infrastructure or meaningful jobs.

If the citizens of Abbotsford can’t afford to shop except at dollar stores, high end retailers aren’t going to do very well. And on $10 an hour for your warehouse job you ain’t visiting too many high end retailers.

So why did we promise to use tax dollars to effectively finance the kind of companies which, a) aren’t go to do very well here, b) aren’t going to contribute much while they’re here, and, c) are costing the taxpayer millions of dollars a year?

You’ll have to ask people like former Economic Development manager Jay Teichroeb, former banker and councilor John Smith, former councilor and Chamber of Commerce director Bruce Beck, Patricia Ross, Simon Gibson, Dave Loewen or the chain newspapers which promoted the whole scheme, why they thought such a mind numbingly dangerous, expensive and futile strategy would work.

What Now?
Moving forward the important thing to start adding to the way political decisions are made in Abbotsford is truth.

Instead of protecting taxpayers, voters and citizens from the facts, our one remaining newspaper should start sharing that information so that citizens can a) participate in a useful manner in the matters which affect them, b) make sensible judgments on the performance of the people they elect based on what they actually do, and, c) lose the fear which many businesses and citizens have of the repercussions they might suffer if they speak up.

The paternalistic system of pretending that those who run our City a) know what they are doing, b) understand what we expect of them, or, c) would admit they didn’t know if asked, has failed us miserably.

In the absence of true discourse our community leaders have simply listened to the voices which carry the most weight in this community and become their agents and spokespeople.

As a result we heading in the direction of being a failed city. While City Hall has finally stopped spending more money than it has on administration it cannot escape the realities of life as a city with no money to spend.

We have no Development Cost Charge (DCC) funds (in fact we owe money to our DCC funds); we have the most critical and most intransigent homeless crisis in the Lower Mainland; our water and sewer pipes cannot accommodate new growth; our financial commitments are keeping us from being able to spend any money solving the very real structural economic problems we’ve got.

If politicians and Chamber executive try to sell the fact that City Manager George Murray has cut back the endlessly increasing costs of the city administration by gutting the bureaucracy, as good news, they should ask themselves if a drastically reduced economic development department is the sign of a healthy growing economy.

Before they sell the reduction in the amount of money being spent on the administration of government in Abbotsford they should warn taxpayers of the other increases coming their way and the significant ways in which the costs of all the commitments the City must now live up to has wiped out our ability to deliver the kinds of services citizens in a city this size expect.

While Mayor Banman promises a bus route to the new homeless village he says he supports, he may want to find out wht we’ve never even been able to afford a bus to the airport. He may want to start looking at just how empty the fiscal cupboard is as a result of Plan A before trying to spend any more money we don’t have.

When Council reconsiders its wise decision not to allow the Fraser Valley Regional District (FVRD) to impose the lion’s share of the costs of a new UFV Intercity Transit on the taxpayers of Abbotsford, the majority of those who made it impossible for us to spend any money on such things will probably vote for it thereby putting us further into an untenable financial situation.

Next time a City councilor tells you we can’t afford to do something, ask them why we can seem to afford to protect the profits of the Calgary Flames or the owners of Highstreet Mall while being somehow unable to build the kind of infrastructure needed for economic growth to occur.

Then watch their eyes glaze over as they try desperately to understand what on earth you’re talking about.

Stop Sending Our Money Out Of Town
We have to stop sending money to Calgary and Philadelphia just because George Peary and city staff were out maneuvered
by smarter, more experienced and better negotiators. That money needs to be put back into our reserves. Our DCC funds must be paid back and our capital reserves need to be replenished.

Blaming those who were right about ludicrously poorly executed Plan A and pinning your hopes on eventually convincing people to buy hockey tickets they don’t want is not an economic development strategy. Deciding you work for the taxpayers who pay for your existence instead of the owners of out of province and out of country sports and entertainment companies which are sucking over $10 million a year out of our pockets would be a start.

Putting that money to use for Abbotsford taxpayers and citizens, by replenishing our reserves and investing in our infrastructure must come next.

Seeking out businesses and industries which pay high wages enabling a well-educated and wealthier tax base which can afford to help build a better city.

Unless we take these steps we will be forced to continue finding savings out of thin air, deferring the necessary infrastructure improvement and giving away the farm in order to attract businesses which won’t be able to succeed.

But before any of that will be able to occur we have to start discussing the truth instead of the fictions and pleasant news we now discuss. That may be even harder to achieve with one less media voice in town.

Originally published 12/03/13


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