Walter Robinson

Pushing the city's economic development agencies for more accountability and strengthening the private sector should be two of the priorities at city hall this year, one observer says.

The Ottawa Business Journal spoke with Walter Robinson, former federal director for the Canadian Taxpayers Federation and now a private consultant and columnist, on his perception of city hall in 2004 and his predictions for the coming year.

THE BACKGROUND: "It was a tough year for city hall. The 2004 budget debacle – that's what it was in terms of you're almost one-third of the year through before approving a budget – you lose a lot of leeway and flexibility to make overall year-end, full-year program changes, whether that means increasing services, cutting services, whatever the case may be.

"The other challenge council had was there is a question - and I don't say this to be mean-spirited - about whether Bob Chiarelli is going to really seek another term or not. He's said he has, but a lot of people don't believe that, so there's a whole bunch of people at council trying to figure out where their political ambitions lie and should they make a grab for the big chair or not.

"There hasn't been a lot of heated debate on a variety of issues and the other challenge they've had, in terms of the cuts they made, they were the wrong cuts on transit, on leaf and yard waste pickup. They basically failed the overall budget test and that came back to haunt them later in the year and we're seeing that now in the 2005 budget debate.

"The rural discontent is real and it's not just rural, it's suburban and ex-urban, it's outside the old core city of Ottawa. More and more people are questioning amalgamation. I was a strong proponent of amalgamation, but there's a variety of things that haven't worked and part of that I think goes back to the former provincial government in terms of their enabling legislation, they didn't mandate alternate service delivery or didn't set caps on salary settlements and so forth. Part of this flawed enabling legislation didn't have enough teeth to direct how the city would grow from an expenditure point of view and it continues to hamper the mayor and council."

THE GOOD NEWS: "The federal government finally came through with the GST rebate, the provincial government has announced its tentative first steps on a transit subsidy from gas taxes and, near the end of the year, the mayor, to his credit, in conjunction with the other big city mayors around the country through the Federation of Canadian Municipalities, came up with a list of criteria for sharing the federal gas tax. We don't know what that number may be, I think it will be anywhere between $14 and $20 million for Ottawa or more, which is fair to big cities and smaller cities alike. Those are some of the good news things that didn't necessarily happen at council chamber, but where the city of Ottawa was implicated in the debate."

THE BAD NEWS: "That was the budget debacle and the cutting of leaf and yard waste pickup and some of the transit cuts. What council did in the 2004 budget debate is they went for the most visible things, as opposed to questioning the rationale of other things, like the continued focus that the city has on communications and consultations to satisfy special interest groups and nobody else. Those are some of the structural issues that they have to deal with in this coming budget debate.

"Ottawa doesn't have a true vibrant dynamic private sector. And I don't say that to belittle Ottawa, it's the point that one out of every five jobs in our city is still reliant upon government at the federal level and that is growing. Even the big accounting firms, the big banks, the big consulting houses, they are all focused on procuring government work first, foremost and always. We haven't had any wins on an economic development side from attracting new corporate head offices to this city or bringing a brand new production facility to diversify the base. Some of the good news stories we still don't know or haven't heard about because they are still in their infancy stages is the growing life sciences and biotech cluster that Ottawa has.

"If the city is going to continue to provide money to the OTCA, to OCRI and to other (economic development) organizations, the mayor and council have to say to those organizations, who are led by some very honourable and very professional people, 'Here are the benchmarks we are setting for you for this funding to continue. Go out and get a new head office. Tell us what your goal is for venture capital financing that you are going to secure from places like San Jose and Boston for startups in the second wave of telecom and the emerging life sciences cluster. OTCA, show us the five major conventions and events you are going to go get for economic impact.' I think that is the accountability that city hall has to bring in and tie to its funding to these organizations and then let people like Jacques Burelle and Jeffrey Dale do their thing, which they do very well. Set those benchmarks, set the accountability indicators and say you've got to perform to these standards. If you're going to get public money to finance some of your operations, figure out where you're going to be. You can't be all over the map; you have to be meeting some goals. I'm not criticizing those organizations; it is just about stepping up to another level of accountability, another level of results and another level of economic growth and vibrancy for the city."

THE BIG PICTURE: "In 2005, I think we're not going to see what I think needs to happen, again, a rationalization of city staff. That does mean layoffs and figuring out what core businesses the city should be in. We're going to see a budget debate that will probably come in with a tax increase between four and seven per cent, unfortunately, because this is the year to do it from a political dynamic, it's not in 2006 leading into an election on Nov. 13, 2006 at the municipal level.

"So we're going to see the tax increase this year, but we're also going to see some jockeying for position, we'll see people pressing the mayor and we'll know whether the mayor is serious about seeking another term. You'll see that infrastructure ramp up with the people around him and, if not, you'll see the posturing of some people on council, perhaps Diane Deans, maybe Peter Hume, those are two names that are out there. You'll probably see the outside group of people like Brian McGarry, who said he is going to run; you're going to see a lot of that in the city hall dynamic.

"What you're also going to see, hopefully, is Rejean Chartrand's strategic delivery unit, which is under the auspices of city manager Kent Kirkpatrick's portfolio, find us more P3s and innovative ways to meet the growing infrastructure needs we have, especially on the recreational services side. We have some very serious capital needs on sports facilities, on cultural facilities, but there is only so much we can do from a taxpayer point of view and what I hope we will see is council take off its union blinders and embrace private finance initiatives and set the government's criteria to ensure that we do get best value for taxpayer dollars.

"I'd also like to see city hall say we cannot continue to rely on government growth as the main engine of assessment and revenue growth for our city. It has to be more private sector focused, so let's really have a concerted effort on the life sciences cluster, on the companies that have done well and survived the telco shakeout and the ones that always had a product to sell. Let's challenge our economic organizations, both the ones that are focused externally and the ones that service members internally, to build a better business climate in ensuring that we can attract more of those companies here.

"I would hope that the city can take the leadership role in continuing to push the provincial government on property tax reform and ensuring that we are not making business shoulder an unjustifiable amount of the property tax burden and figuring out how to assess properties better, so everyone across the seven classes, residential and the six (business) classes, feel that they are being taxed more fairly on the value of their property.

"The other thing you may see is a few more councillors pack it in. You've got some people there now have served seven, eight,10 or more years. You may see some make the same decision that Jan Harder has made and say I don't need to do this for the rest of my life, I'm going to try and do something else. I think we may see the seeds of turnover happening for a 2006 election because the frustration level out there is very high with council. There are some good people at the table, but figuring out how they do policy-based governance and setting a direction for the city is still a challenge for city council. It's a challenge for city councils across the country but I think it's extremely acute for this city council."