Prepared by: The Greater Niagara Chamber of Commerce
St. Catharines Business Council
February 24, 2014
Good Evening Mayor McMullan, City Councillors, and members of city staff. My name is Steve Cook, Chair of the St. Catharines Business Council and a Director with the Greater Niagara Chamber of Commerce. I am also President of Credit Bureau Services Canada, located here in downtown St. Catharines. I am joined by Walter Sendzik the Chamber’s CEO and the Chamber’s Policy Team – Kithio Mwanzia, Director of Policy and Government Relations, and Graham Lowe, our Policy Analyst – who have both been following the budget process closely.
On behalf of the Chamber, I would like to thank you for the opportunity to comment on this year’s Budget.
The Greater Niagara Chamber of Commerce is a member driven organization with over 1,500 members representing more than 36,000 employees. We are the largest business organization in Niagara and the third largest Chamber in Ontario. Within the Chamber’s structure, members are able to establish both geographic and sectoral business councils to facilitate targeted activities that enhance the connectivity of related businesses and foster new opportunities. The St. Catharines Business Council is one of (8) sectoral and geographic Business Councils within the Greater Niagara Chamber of Commerce.
Tonight’s presentation has been informed by the Chamber’s Finance and Taxation Committee – comprised of business professionals with backgrounds in finance, accounting and business management – the St. Catharines Business Council, and members of the Chamber’s executive team.
As members of the Budget Committee are aware, the Chamber has been present throughout the budget process and has also participated in the budget open house session. City staff and members of the Budget Committee continue to be forthcoming and timely with information related to the budget, as the Chamber has developed its positions – demonstrating their ongoing commitment to support meaningful stakeholder engagement.
The finances of municipal and regional governments play an important role in building a competitive environment that retains and attracts business. Property taxes – of which, businesses carry a greater burden than the average residential ratepayer – are part of a complex web of costs that can drive business out of a community.
A central objective of the Chamber’s continued involvement in the municipal and regional budget process is to ensure that the financial management of a city, town or the Region is based on sound financial principles that balance a community’s range of services with a community’s ability to pay.
Everyone in this room tonight can agree: Niagara’s economy is still facing significant challenges. With the highest unemployment rate in Ontario at 8.9%, and with a continued loss of jobs here in St. Catharines (like Silicon Knights, Transcom, Niagara Classic Foods, Port Weller Dry Docks) – clearly, we are still facing significant economic challenges.
Over the past few years, the City has invested in key infrastructure projects that the Chamber has been very supportive of – the Performing Arts Centre, Meridian Centre, the combined Aquatics Centre and Library and the downtown parking garage. These civic projects were much needed after years of city councils failing to properly invest in our city – and we were fortunate to have provincial and federal partners on these projects – otherwise, St. Catharines would be even further behind other communities like Burlington, Guelph, Kitchener-Waterloo and London.
But, when it comes to sound fiscal management, city council has failed to counter the investments in these new buildings by reducing and closing aging facilities and rationalizing the range of services it provides.
For example, the Chamber has been advocating for the Fairview Golf Course to be closed. It’s an under-utilized municipal property that costs the city money to operate. And it’s located on prime real estate that could be better-suited to be the GO Bus Transfer Station.
It has also been recommended to city staff to explore opportunities for the Municipal Golf Course to be operated in partnership with Niagara College’s Golf Management program. Again, an opportunity to shift costs of operation, but to date no action has been taken.
When it comes to libraries, museums, arenas, golf courses, pools and other services offered by the city, there is a lack of a fiscal framework to properly evaluate efficiencies of delivery of the services, as well as the ongoing affordability of these services.
To put this in context: ice users cover 70% of the operating costs of city-owned arenas, while the museum covers only 18% from users and library services covers 10% of its cost from users. And yet, tonight the focus of many presentations will be on the closing of ice pads – which will only increase the cost coverage by users – and no other service is being questioned in its efficiency and cost coverage by user groups.
It is time for the city to adopt a comprehensive policy that equally measures all services in a comparative model so that costs do not dramatically exceed revenues from one service to another – and decisions affecting each service can be made based on sound policy, not on a political decision based on the location of a particular library, pool or arena.
Based on the user coverage rates I just noted – it appears ice users are paying for a much greater share of a municipal service than library and museum users, and with this year’s budget, it’s the ice users that are being asked to make do with less…
Now, in addition to an effective policy to measure affordability of all city services, the Chamber is recommending the following for consideration:
- With the recently completed asset management plan, the City of St. Catharines has an opportunity to adopt an innovative model of managing its assets by following the City of Guelph’s leadership and establishing a municipally-owned holding company to manage designated city assets. The holding company would have the task of:
- Overseeing an Asset Disposal Strategy and public asset conversion,
- Overseeing a full-scale Civic Project Fund Replenishment Initiative,
- Building and executing business cases that demonstrate best
value for money for assets.
Council would decide which municipal assets from the asset management plan would fall under the purview of the holding company, allowing the company to act in a more business-like fashion and better leverage emerging market opportunities. All assets that generate a return should be directed to replenishing the Civic Project Fund to prepare the city for future infrastructure projects. The Chamber recommends that Council direct staff to review the Guelph model, and report back to Council on the concept.
- Based on the Budget Committee’s report, the Chamber is supportive of the Committee’s decision to close the Garden City Complex. When the Four Pad was built, it was built with the understanding by all participants that aging arenas would be removed from service over a period of time. Unfortunately, previous councils again failed to follow through on the concept of rationalizing buildings and services when new buildings were built to replace aging facilities. And when the Spectator Sports Complex was approved, the Chamber supported the recommendation at that time to close the Garden City Complex and sell the land to help offset the costs of the new Meridian Centre. Council is elected to make tough decisions – and tonight is one that will test your willingness to make a decision that is fiscally sound, but not the most popular.
- The Chamber recommends that City Council, based on the City’s funding of public transit, direct the St. Catharines Transit Commission to begin discussions immediately to merge its operations with Welland Transit and Niagara Falls Transit to form a Regional Transit Commission – with the three communities serving as shareholders of the Commission. This action is required to finally establish a truly integrated public transit system in Niagara – and it is a critical piece for attracting GO Train commuter service to the Niagara region.
- The Chamber recommends that City Council establish a Joint Service Initiative Committee in collaboration with neighbouring municipalities to determine which municipalities would be best to engage with in further shared service initiatives and in which service areas this method could be best applied. We have to move past looking at services such as ice pads, libraries, pools and other services as bounded by municipal boundaries. For example, Thorold is looking at replacing its ice pads – through a shared service model, the cities should be working together to build a multi-municipal complex that reduces the cost to taxpayers and at the same time provides new, high-quality facilities for ice users. The Chamber recently made a similar recommendation during its budget presentation to the City of Thorold and it was well received.
- Finally, we are asking Council to keep pushing for the Ontario Government to reform the arbitration system for emergency services. In the overall scope of the operations of the city, awarded arbitration is the largest cost driver in the escalating costs of fire services.
Municipalities outside of Toronto are struggling to cover the costs of emergency services that are pegged to the same salaries as those working in Toronto. Our Chamber has joined with the Ontario Chamber and 103 other chambers to request the Government change the process and take into account a community’s ability to pay. The public has to understand that escalating costs of emergency services will only mean more reductions in other city services.
The decisions before you tonight are not easy, but as a Council you have a responsibility to make the difficult financial decisions when it comes to ensuring that the City of St. Catharines is on solid financial footing moving forward. While there is still much work to be done to turn Niagara’s economy around – as the largest municipality in Niagara – the decisions you make tonight, and the decisions you make moving forward, will play an important role in creating an environment that attracts business investment and fosters a stronger and more prosperous local economy.
Thank you again for providing the Chamber with the opportunity to speak this evening, and I look forward to your questions. Thank you.