City signs on to regional economic development group

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Cost to St. Albert will be roughly $180,000 over three years

The city of St. Albert has joined 14 other municipalities in the capital region to create an economic development entity.

The purpose of the organization is essentially to promote the capital region as a whole to international investors, which would theoretically leave other organizations such as the city’s economic development department free to pursue other economic development goals like supporting existing businesses and helping them grow.

“They see this as basically helping them build capacity in other areas – taking the need for business attraction off their plates,” government relations manager Lynette Tremblay said.

Council unanimously approved funding up to $300,000 over three years toward the Edmonton Metropolitan Regional Economic Development entity at the May 23 meeting, but at that time it wasn’t clear how many members would join by the May 24 deadline.

Tremblay told council the actual contribution from St. Albert would likely be lower. As of May 26, she said the city’s total contribution would be roughly $180,000 – $26,000 in 2017, $55,000 in 2018 and $100,000 in 2019.

The funding is similar to the Capital Region Board funding model, in which each member contributes a base amount plus an amount proportional to their total population and total assessment value. But the final funding formula won’t be finalized until representatives from the 15 shareholders who have signed on meet on June 8.

The 15 members include Sturgeon County and Morinville, who also voted this week to sign the agreement. Members have signed on for a three-year minimum.

The organization itself would have representatives from each of the shareholder municipalities to oversee a board of directors. St. Albert council appointed Mayor Nolan Crouse as the representative and Coun. Cathy Heron as an alternate.

That board would comprise economic development experts representing the different sub regions within the capital region, who would in turn oversee an executive director in charge of the organization’s operations.

The budget for the groups in the first year is $1 million, with municipalities contributing half. The budget for 2018 is projected to be $3 million, with municipalities contributing $1 million, and the budget for 2019 is projected to be $5 million, with municipalities contributing $2 million. Provincial and federal grant money is expected to pay for the remainder.

Council voted 6-1 to get on board, although there was some concern the city was “going in blind” by committing the money before having a thorough understanding of what the entity would look like in the long run.

Coun. Bob Russell voted against the move, saying the city’s money would be better spent on economic development within the city.

“This is a taxpayer sinkhole if I ever saw one,” he said.

Coun. Wes Brodhead pointed to several examples where this model has been implemented successfully, such as in Denver, Colo., and in Columbus, Ohio, as showing why this might be a good idea. He also used the example of the Edmonton International Airport’s governing body, which St. Albert declined to sign on to years ago. Now it can’t get a seat at the table even if it wanted to.

“We should be part of forming this company, and not watching it from the outside,” he said.

Coun. Sheena Hughes, though she voted in favour of moving forward in the organization, said she was concerned this entity might have ended up going the way of the Metro Mayors’ Alliance, which St. Albert signed on to at first but then withdrew from before really getting much benefit out of it.

Tremblay said the downside to signing on later, however, would be that the city wouldn’t have a seat at the table in establishing the structure of the group. She said after the meeting that regardless, the comparison to the mayor’s alliance isn’t necessarily apt.

“I think one of the benefits to this as opposed to the Metro Mayors Alliance is this is something that has been done before in other regions and done successfully, so there are models out there we can look to,” she said.

The company would be formed as a Part 9 company under the Companies Act – essentially a non-profit organization but not necessarily a charitable organization – in which profits, if any, would have to be reinvested into the group.

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Doug Neuman