Attracting development

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Two years later, it's still up for debate how much economic development succeeds in the city

The city’s economic development department, celebrating its second anniversary in September, has fostered strong relationships in the development community and improved the perception of St. Albert as being open for business, executive director Guy Boston says.

“We treat every potential opportunity as golden now because you never know what it could do,” he said this week.

City council first created the position of executive director of economic development in September 2011, hoping to hire someone who would build a department to travel the world and encourage businesses to relocate to St. Albert.

Boston, a former city engineer, took on the job in July 2012.

He said the city has seen more non-residential development in the past two years than ever before, referring to the commercial developments in Erin Ridge North and South Riel, and the province’s development of a new liquor storage facility on the former casino lands in Campbell Business Park.

“We are starting to bring the amount of the non-residential (development) up significantly,” he said. “The reliance in the property taxes is dropping because of what is going on in the non-residential.”

Part of that change was an increased focus on economic development in the city as a whole, added Joan Barber, manager of business retention and expansion.

Barber, who has worked with economic development in the city for almost 12 years, said the department has now fostered much closer relationships with city administration and other departments, such as planning and engineering.

This ensures that information can be quickly transferred to developers. In turn, it has made the department a reliant and constant source of information to potential investors, she said.

“I think the entire city for the first time since I worked with the city is really saying economic development is a priority and everybody is working very hard to ensure that it is,” she said.

However, political observer and former mayor Richard Plain warns against being overly optimistic.

Much of the development now taking place in the city was only possible because former councils did not sway in their decision to zone land in the city commercial and light industrial, he said.

But recent councils have loosened their grip on economic development, leaving too much of the decision making process to bureaucrats and relying on information supplied by administration, he said.

“The danger is some very good people on council never get the opportunity to learn the business or to spend the time on it,” he said. “We used to at least have half of them that had that background.”

Subsequently, important developments formerly zoned for commercial use were changed to residential, he said.

But St. Albert does not have the land available to keep adding people and to expect economic development somewhere else will make up for the taxes, he said.

He also worries that development in the city will take on working in the interest of investors, but not in the interest of the citizens.

“You can’t have council say, gee, we don’t know what they are doing,” he said.

Mayor Nolan Crouse said he spent the first six years of his time in office nurturing relationships with hundreds of developers and investors looking to come to St. Albert.

But the city had a reputation for not being open for business.

So it hired a city manager with a background in economic development, and created a department to make sure the development community would receive the attention and focus it deserved, he said.

“Otherwise how do these people know we exist?” he said.

He added that Guy Boston and his team have done a good job in creating relationships and keeping development in the city.

He would like to see them continue that work, but also spend more time travelling across North America to bring developers here, he said.

But it’s also up to the landowners and developers now to take the next step, he said.

“The one thing that I have been insisting upon personally and I have spoken about it quite often is the need for willing landowners,” he said. “The landowners in the vacant land need to be willing to move forward.”

Nonetheless, one city councillor agrees that council could benefit from more information on the work of different city departments, including economic development.

Sheena Hughes said it’s difficult for her to compare the department’s successes to prior years, having only been on city council for one year.

She doesn’t believe council should micromanage economic development, but councillors lack a grasp on the department’s work, she said.

“We have just stats, reports on how things are but we don’t have measurable performance goals for us to be able to say are we meeting or exceeding what we are trying to achieve,” she said.

“The budget (for economic development) has increased significantly. Whether or not we are getting that money back we don’t have that as a measurable performance goal.”

Experts in the development community are also divided in their judgment of the department’s success.

In a previous interview with the Gazette, John Ross with Avison Young, a commercial real estate firm, said the community was known to have a lot of red tape.

Businesses suffered because of that but the city has now loosened its grip, he said.

“St. Albert has become a lot more user friendly, or developer friendly, in the last decade than it was previously,” he said.

However, Mike Keating with Colliers International, another commercial real estate firm, said it’s difficult to judge how open the community is to business and how much of its success is due to a strong economy.

He said that many of his clients remain cautious about developing in St. Albert because of the city’s high operating costs and taxes, which are still higher than in the rest of the greater Edmonton area.

“The test is when someone comes to St. Albert and they do a development,” he said. “Do they keep going, do they develop some more, or do they do one development and then pull their horns in?”

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