It looks, at least to me, that the Economic Development Corporation has come full circle.
Back in the 1980s, economic development was a two-person show with Commissioner Doug Leighton, who was assisted by a secretary, being employed by the city and reporting directly to city council.
Leighton was given the lofty sum (sarcasm) of $135,000 to run his office, officially known then as the industrial development department.
Later, when a council finally came along that was prepared to pay more than lip service to economic development, it was split off into what became the Economic Development Corporation with its own board of directors, an executive director with several employees in support, and a budget that was in the millions.
Now, although the spin would have us believe otherwise, it seems that economic development is once again coming directly under city hall and therefore city council supervision.
Council voted approval in December of a restructuring plan that would see employees of the EDC move to the city payroll on Jan. 1.
Now I don’t really know if this change is a good thing or a bad thing as I haven’t really followed the workings of the EDC that closely. In fact, I always thought it didn’t do enough blowing of its own horn, leaving those of us on the outside who were paying its way through taxes to wonder at times what ir really accomplished.
However, after reading news reports on the change I did have a few questions to throw at Malcolm White, the city’s chief administrative officer who presented the restructuring plan to council.
He nicely addressed each question individually in his reply. Some of the questions and answers, some partially redacted for space, follow::
Millroy: Will there still be a director or will EDC staff report to someone already in the city? If there is to be a director and they are a separate department with the city, who will the director be?
White: Both the economic development staff and the tourism staff will report through the Community Development & Enterprise Services (CD&ES) area, albeit in separate verticals, as they will be interacting with two different boards (Economic Development Corporation and a new Tourism Development Corporation). In a separate reply White said there still will be a Director of EDC and it will be Daniel Hollingsworth (who presently holds the job), reporting to Tom Vair, Deputy CAO, Community Development and Enterprise Services
Millroy: Where did the idea for this move arise? Isn’t it going back to what we had years ago?
White: The idea to transition to this model evolved over the last two years. It was informed by the review we conducted in 2017 where, in part, we examined different models of delivering economic and tourism development services and the roles of the EDC, Innovation Centre and the City; the community development work now being done by the City, projects where EDC and City staff have worked together . . . The model allows us to ensure staff in economic development, tourism development and community development are operating with a ‘One-Team’ approach as their activities are often linked with each other.
Millroy: I would also like to confirm some numbers. When things changed with the EDC a couple of years ago, was the funding cut $500,000?
White: As a result of the EDC’s revised role and Memorandum of Understanding with the City in 2017, the level of funding was reduced by $444,656.
Millroy: Was the payout to EDC staff laid off $420,000 or close to that figure. How many were laid off?
White: It is my understanding that staff-related restructuring costs were much lower than that (i.e. less than half of that amount). I understand that the staff complement was reduced by approximately. 2.5 full-time equivalents..
Millroy: Does the EDC have $2.5 million in the bank as a result of the sale of Searchmont? What happens with that money? Does it just come to the city?
White: The EDC has funds in that range (mostly from the sale of the former Sutherland building), as well as money from the surplus of the Destination Marketing Fund (approximately $1.7 million) that built up over the years (the Municipal Accommodation Tax implemented in 2019 replaced the former voluntary DMF). The EDC will retain the MAT funds, while the DMF surplus will be transferred to the new Tourism Development Corporation. The EDC and the TDC boards will have full authority over the use of those funds.
Millroy: If the new governing board of the EDC has no workers below it, what does it do with any ideas it comes up with? I note a story in The Sault Star it said the board would give strategic advice to the city. Why would anyone want to sit on such a board?
White: The role of the EDC board going forward will be similar to the current role – providing strategic advice, reviewing and approving strategic and operational work plans and budgets. The key changes are that it will be focused on economic development; it will not be responsible for day to day administration of staff and that the approval decisions on plans and budgets will be forwarded to council for final approval.
Personally I am not against the move because I think in the long run it will save taxpayers money and allow for closer collaboration by the parties.
But I would be surprised if either the EDC or tourism boards remain in existence for long, considering their roles now will be relegated to what appears to be only an advisory capacity.
I think the city is just being nice in offering them a role when, in truth, there really will be no need for them.
Which, I believe, they will soon come to recognize