HomeMy WebLinkAboutADM-004-03
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REPORT
ADMINISTRATION
Meeting:
GENERAL PURPOSE AND ADMINISTRATION COMMITTEE
Date: June 16, 2003
Report #: ADM-04-03
File#: lor
GPA-'3/<6-b3
By-law #:
Subject:
Clarington Board of Trade - Contract for Economic Development
RECOMMENDATIONS:
1. THAT Report ADM-04-03 be received.
2. THAT Council approve the contracting of economic development functions to the
Clarington Board of Trade, subject but not limited to, the following terms:
a) The Municipality shall pay the Clarington Board of Trade an annual sum of
$90,000, $95,000 and $100,000 for years 2004, 2005 and 2006 respectively.
These sums are exclusive of the free office space provided to the Board at the
Tourism Centre on Liberty Street.
b) That Council approve a one-time capital contribution of $18,000 to be advanced
in 2004 for the purpose of enabling the Board to prepare a business directory
and inventory of vacant buildings and properties.
c) The Clarington Board of Trade shall, as a minimum, present to Council an annual
report including an account of all economic development activities undertaken for
the given year.
3. THAT the Mayor and Clerk be authorized by by-law to execute the agreement between
the Municipality of Clarington and the Clarington Board of Trade subject to the Region
of Durham approving Clarington's continuous delivery of economic development
functions under the new Municipal Act.
CORPORATION OF THE MUNICIPALITY OF ClARINGTON
40 TEMPERANCE STREET, BOW~AN~ltto gNTARIO l 1C 3A6 T 905-623-3379 F 905-623-5717
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REPORT NO.: ADM-04-03
Page 2
4. That the Region of Durham be requested to continue to grant the economic
development activities function to the Municipality of Clarington under the new Municipal
Act.
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Submitted by: Franklin Wu,
Chief Administrative Officer
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REPORT NO.: ADM-04-03
Page 3
1. Background
1.1 On November 7, 1998 Council approved the privatization of the function of economic
development to the Clarington Board of Trade. Subsequently, an agreement was
entered into setting out the details including the obligations of the two parties. The
agreement ended on December 31, 2000 and was further extended for three years,
ending on December 31, 2003.
1.2 The financial portion of the contractual agreement with the Board of Trade in the
previous years are as follows:
1998 - $35,000
1999 - $50,000
2000 - $75,000
2001 - $75,000
2002 - $75,000
2003 - $75,000
These funds were intended to cover the salary/benefit expenditure of the Board in order
to retain the service of a professional Economic Development Officer/Manager to
handle the business retention and business attraction responsibilities. The costs of
office administration and other Board activities are covered by other revenue services,
such as membership fees and special events.
2. Request for New Contract
As the current contract will expire at the end of this year, it is imperative that the future
of economic development function be addressed now. In this regard, representatives of
the Board of Trade have met with the Administrator with a view to negotiating a new
contract to allow the Board of Trade to continue the economic development functions on
behalf of the Municipality.
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REPORT NO.: ADM-04-03
Page 4
a)
A new three (3) year contract commencing January 1, 2004, ending December
31, 2006 whereby the Clarington Board of Trade will deliver economic
development functions on behalf of the Municipality of Clarington.
b)
The Municipality will provide an annual lump sum payment to the Board on the
first day of March in each calendar year, in the amount of $90,000 for year 2004,
$95,000 for year 2005 and $100,000 for year 2006.
c)
That economic development function is generally defined as business retention
and business attraction.
d)
Automatic renewal for one additional year at $100,000 for year 2007, subject to
the consents by both parties.
e)
The Board shall at a minimum, report to Council once a year pertaining to all the
economic development activities undertaken.
f)
The Board and its employees shall refrain from engaging in any activity that
would negatively impair the relationship between the Municipality and the Board.
g)
The Municipality will provide free office space for the Board's employees at the
Tourism Centre at Liberty Street and Highway 401.
The Municipality will provide the Board a one time contribution of $18,000 for the
purpose of preparing a Business Directory and Vacant Land and Building
Inventory.
h)
4. Comments
In the consideration of whether or not the Municipality should continue the current
privatization initiative with the Board of Trade, certain factors must be considered. In
particular, it is prudent to review the past performance of the Board of Trade in its
delivery of its responsibilities under the terms of the agreement to ensure the
Municipality is getting the best value of its tax dollars.
Since assuming the responsibility of economic development in 1998, the Board of Trade
has slowly and gradually evolved into an umbrella organization, working in concert with
various business organizations within Clarington to further the common goal of
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REPORT NO.: ADM-04-03
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promoting Clarington has a desirable place to do business. Through the direction of the
Board of Directors and tireless effort of the previous Business Development Officer and
the current Business Development Manager, the Board has taken on many economic
development and promotional initiatives, all of which are to be commended. The Chief
Administrative Officer, having the experience of working closely with the Board since its
inception, is pleased to advise that the Board has done an excellent job in promoting
business in Clarington and would recommend to Council to continue this privatization
initiative.
The recommended amounts of $90,000 for 2004 and a gradual $5,000 increase for
2005 and 2006 are considered reasonable, and it represents an average annual
increase of approximately 4.75% between year 2000 and 2006.
The $18,000 one time capital contribution is recommended to be provided to the Board
in order to allow it to acquire the necessary tools to perform the economic development
functions. These tools include a Business Directory and an Inventory of Vacant
Buildings and Properties. These publications represent the very basic, and yet
essential tools for every economic development personnel, and are absolutely
necessary irrespective of who is delivering economic development functions.
5. New Municipal Act Ramification
Prior to the new Municipal Act coming into force on January 1, 2003, the Region of
Durham, by by-law, has authorized its local municipalities to perform economic
development functions. The new Municipal Act has given the economic development
function exclusively to the Region of Durham with a proviso that the Region may allow
the local municipalities to perform the economic development function. In order to
ensure the future agreement with the Board of Trade would not be contrary to the new
Municipal Act, it is recommended that the Region confirm with Clarington that the
previous arrangement will be carried over under the Municipal Act.
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