Unclear how extra funding for BEDC addresses Burlington’s jobs crisis

The BEDC Office: Need to re-focus on business attraction; less on networking luncheons

The BEDC Office: Need to re-focus on business attraction; less on networking luncheons

Council and staff recognized two years ago that attracting new businesses and creating jobs for Burlington residents is the city’s “burning platform.” Council directed the Burlington Economic Development Corporation to shift away from being a self-described “social club” to actively wooing businesses to Burlington, and set aggressive job targets.  But progress has been glacial. While municipalities around us are courting businesses, BEDC still spends too much time and money on networking activities and general marketing.

Burlington’s dependence on residential development means an increase in your taxes.  Residential development costs about $1.40 to service for every $1 in tax revenue we get. Development charges only cover about 80% of the costs of this growth.  The increased spending for Alton to service the new library and community centre, additional crossing guards, and transit service is not covered by the increase in assessment growth.  Alternatively, for every $1 in tax revenue from industrial, commercial or institutional development, the city makes about 60 cents.  That helps fund the services you need. You’re paying more than your share: our tax base is 75% residential, versus 25% commercial. We need more balance between the two, or your taxes will continue to rise. But we’ve seen a huge drop in commercial/industrial tax growth since 2011 – growth is now less than a quarter percent annually.

The BEDC is asking for an additional $275k to be added to the 2014 base budget – which taxpayers will fund indefinitely.  

For the BEDC, the most effective step we can take to address the jobs crisis and accelerate a focus on business attraction is to get BEDC out of the networking lunch/event business altogether. Though they generate revenue, these events take a great deal of staff time away from business attraction. The additional investment in BEDC to make up for lost event revenue (net of expenses) is $61k.

Further, BEDC is still in transition and council won’t receive a report until April outlining their new structure and plans. And they haven’t yet reported back to council on how they used the $375k increase in last year’s budget. We can’t let our interest in economic development keep us from asking tough questions and requesting solid data on results – namely leads generated and jobs created. No one gets a blank cheque without scrutiny. Until council has a full account of results from our first investment, and what our return on the second investment will be, funds should not be built into the base but offered as one-time only.

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