Good Evening Regional Chair, Chair of the Budget Review Committee of the Whole, Regional Councillors, Regional staff and members of the public. My name is Kithio Mwanzia and I am the Director of Policy and Government Relations for the Greater Niagara Chamber of Commerce, I am joined here by Graham Lowe the Chamber’s Policy Analyst who has been a part of the budget deliberations since they began.

As you know the Greater Niagara Chamber of Commerce is dedicated to working on behalf of our members to foster an environment in Niagara that is truly open for business. With over 1,500 members representing more than 36,000 employees, we are the largest business organization in Niagara, one of the largest in Ontario and privileged to be the champion of the business community. Thank you for the opportunity to provide input on the 2014 Regional Capital and Operating Budgets as a means to actively participate in creating a region that fosters opportunity, and at the same time provides an affordable environment in which businesses can grow and invest.

Like many regions across Ontario and Canada, there are real challenges facing Niagara. A skills gap in the labour force is driving up unemployment which creates increases in poverty affecting children and adults alike. While Niagara has often been situated in the bottom third of most socio-economic rankings in Canada, the work that has been done by stakeholders and leaders in the community has positioned the region to better handle today’s economic challenges. As the leading voice for business in Niagara, the Greater Niagara Chamber of Commerce (GNCC) continues to focus on leveraging the region’s competitive advantages.

Released this spring, the Blueprint for Economic Growth and Prosperity: Launching A Report Card for Niagara is designed to tackle a complex nexus of socio-economic and infrastructure obstacles to growth and prosperity. It is the first step towards developing a community-based solution to measure and monitor the local business climate, hold government accountable and pave the way for future success.

The Blueprint is a result of the Niagara Economic Summit held in 2012. In the course of developing the report, the GNCC has outlined five key areas in which Niagara can focus its energy in order to deliver positive results:

1. Efficiencies in Government
2. Innovation, Incubation and Entrepreneurialism
3. Transportation and Infrastructure
4. Building a 21st Century Workforce
5. Support for Economic Clusters

It is for this reason that we believe that the budget process is not simply an accounting exercise, rather it offers the opportunity to provide strategic direction and establish the framework for policy and process innovation that can be the catalyst for new private sector opportunities and investment in the region. Our approach to the budget this year seeks to highlight specific steps in which the Region can further demonstrate public policy leadership. Budgets play a key role in creating the right conditions for private sector growth and investment.

Again this year we would like to applaud council and staff for recognizing the importance of an engaging and detailed budget process. As you know the Chamber has advocated for sound fiscal planning and a budget process that is designed in a way that meaningfully allows stakeholders to participate. Improving upon last year, this year’s process is reflective of the budget process reform that the business community through the Chamber has been advocating for a long time.

The Chamber is further encouraged by the response that council and staff have had to its recommendations in the past. These include:

1. The completion of a comprehensive report on Alternative Service Delivery by the ‘Regional Responsiveness and Implementation Team’ – In addition, RRIT continues to bring forward recommendations, savings and mitigation strategies that, once implemented, will make for a more efficient public administration
2. Support for key economic development focused initiatives
3. Continued commitment by Council for pursuing arbitration reform. It is has been the Chamber’s position that Council support the other Councils in Niagara, and across Ontario, who are calling for the arbitration process to be changed going forward to include a ‘community’s ability to pay’ as one of the factors in the decision process.

These, along with a well-executed engagement strategy, demonstrate that both council and staff are being responsive to the input from Niagara’s business community. The Greater Niagara Chamber continues to be a committed partner in the region and seeks to work towards creating an environment that is attractive for investment and business growth as well as a place in which families can live and prosper.

The Chamber’s role is to provide input and guidance at a more macro level. This macro approach has been informed by the Chamber’s Finance and Taxation Committee. The Committee is comprised of accountants, and finance and management experts from across Niagara that provide insight and build consensus on issues impacting businesses across the region that have implications in the Regional Operating and Capital Budgets.

The Region has taken a number of active steps to move towards a more dynamic budget and spending program, however there remains fiscal challenges that will require policy innovation that involves the private sector in order to tackle them. These include:

1. Implementing a comprehensive Alternative Service Delivery (ASD) framework in key service areas
2. A capital affordability strategy that does not fully leverage innovative finance and procurement strategies

These are very real challenges that have to be addressed in a dynamic fashion. In addressing these areas the Region would be sending an important signal to the business community that Niagara is putting mechanisms in place to create the right conditions for growth and investment by innovatively managing public finances to provide best value for service matched with fiscal prudence.

The following issues have been raised as part of reviewing the budgets and understanding the Region’s challenges:

1. As you know, Alternative Service Delivery (ASD) entails the pursuit of new and appropriate organizational forms and arrangements, in order to improve the delivery of programs and services. Innovative organizational arrangements for delivering government services can result in more cost effective, responsive service delivery. It is the creative and dynamic process of public sector restructuring that improves the delivery of services by sharing government functions with individuals, community groups, the private sector and other government entities. A comprehensive approach to ASD would be to rethink of the role in service delivery at the program and service level and weigh the benefits and risks of changing service delivery roles.The Region took an important first step by having a comprehensive review conducted by the RRIT on the ASD activities currently conducted at the Region. This review will be a useful tool in assessing the re-think and will form the basis for consideration of candidates for comprehensive ASD consideration.A comprehensive look at ASD would include:
   • • Selecting an ASD Candidate/Candidates for Study
     • Selecting a Service Delivery Model through a Business Case Analysis of Options
     • Develop a Strategy to Implement Selected Service Delivery Model
     • Implement the Selected Service Delivery Model

   In order to achieve this, municipalities have formed an ‘ASD Reference Group/Taskforce’, which has overseen the identification of models and candidates, along with implementing a strategy that included monitoring performance through evaluation. These have often included the private sector in both for-profit and not-for-profit capacities in order to provide expertise on how to optimize the eventual ‘Request for Proposal.’ In addition, they can advise on the best means to approach complex issues like human resource management, contract performance-pay and technological applications.

   To that end we are requesting that Council strike an Alternative Service Delivery Reference Taskforce. The Taskforce will use the RRIT comprehensive report on ASD as the basis to determine which service areas are best suited to apply an ASD model to and design the appropriate business case.

   Leading practice in ASD implementation and looking at other jurisdictions, following the completion of the comprehensive review, much like the one the Region just completed there is a move towards identifying candidates for comprehensive ASD implementation in order to maximise savings and efficiencies.

2. While Niagara’s geographical position is advantageous, it is also in a hyper-competitive corridor where jurisdictions like Guelph, London, Hamilton, Brantford, Waterloo and Western New York are all implementing new and dynamic capital financing programs. These jurisdictions are all looking at how they deliver services and how best to implement their capital program to pay for the structures that are needed to deliver optimal service. Capital affordability projects are always of particular interest to the business community due to their impact on the long-term fiscal picture, growth and development charge policy. Moving forward the Region will need to look at new ways to execute its capital budget program.

Alternative Financing and Procurement (AFP) allows large, complex infrastructure projects to be delivered faster and more efficiently. AFP has become a leading practice in municipalities and has played an important role in how municipal governments can maximize capital financing programs. It is with this in mind that we are recommending that the Region establish as part of its capital expenditure policy, the exploration of AFP for projects costing over $20 million.

Thank you for the opportunity to present this evening, we look forward to your questions and working with you to build a stronger, more vibrant Niagara.