RIP Business Cape Breton?

What the hell happened to Business Cape Breton (BCB)?

I feel the way I expect I will when Rogers Media finally gets around to canning Ron MacLean and Don Cherry — not sad, but somewhat disoriented.

It’s all been so sudden: why, just last month, there was BCB CEO Eileen Lannon Oldford going about her appointed rounds, preparing to co-host a luncheon at the Holiday Inn to encourage local business owners — like Robins Donuts owner/franchisee Gratten (Duke) Fraser — to take advantage of the province’s Small Business ACCESS-Ability Grant Program. And there were her BCB staffers, ready “to assist with the completion of applications.” God was in his heaven, our economic development dollars were safely tied up in BCB salaries and office expenses, all was right with the world.

And then all hell broke loose.

 

It’s CBRM’s fault

According to BCB board chair Parker Rudderham, the villain in the piece is the CBRM which is insisting on following the instructions of the Department of Municipal Affairs and putting its economic development services out to tender rather than simply engaging BCB. As the Cape Breton Post reported last week:

“That’s what we want to do — to put a RFP out there and anyone can bid on it,” said John Phalen, manager of economic development and major projects with the CBRM.

However, Phalen said the Department of Municipal Affairs has specifics within the process they want in place in order to provide funding.

The CBRM puts money into economic development every year and traditionally the province has matched it.

“They have a process we need to follow first,” he said.

This outrage — a process which must be followed — was too much for the BCB board of directors, a group made up of a number of leading local business lights, including Cecil Saccary, Jim Kehoe and Gratten (Duke) Fraser. Board chair Rudderham told the Post:

“As it stands now BCB is an economic development agency for CBRM that ceases to exist and we will not be tendering on the RFP,” Rudderham said. “This will basically end BCB as we know it, effective April 13.”

Rudderham said BCB is not a bureaucratic board and the Regional Enterprise Network program is bureaucratic in nature.

“It was built by bureaucratics, it’s bureaucratic in nature and we don’t see the results,” he said. “I’ve talked to cabinet ministers and for the most part they don’t see the results.

“We aren’t interested in facts and figures, we’re interested in tangible results. We want to do real things and I think we’ll be able to do that under whatever reincarnation we decide on.”

I do believe BCB is not “interested in facts and figures,” I’ve seen their presentations to council. In fact, here’s one I saved from a couple of years back, “Projected Job Potential” is one of my favorite stats:

 

Business Cape Breton Municipal Report 2013-2016

 

 

It also occurs to me that “tangible” is a value neutral term.

 

It’s DMA’s fault

The BCB board’s decision, which will see the current employees laid off, took CBRM Mayor Cecil Clarke by surprise. He told the Post the villain in the piece is not the CBRM but the nasty Department of Municipal Affairs, which is also insisting the CBRM re-enter the REN program it left in 2016:

The mayor of the Cape Breton Regional Municipality says he’s disappointed the Nova Scotia Department of Municipal Affairs is trying to fix something that’s not broken.

Cecil Clarke said the CBRM’s decision to move to a regional enterprise network for economic development was driven by the Nova Scotia Department of Municipal Affairs not the municipality.

“I’m disappointed Department of Municipal Affairs officials continue to create a situation of uncertainty when we already have a model of success in place.”

Clarke said the CBRM was happy with the performance of Business Cape Breton as its economic development agency.

“As the designated economic development agency of the CBRM, the outcomes speak for themselves,” he said.

The irony, Clarke said, is they are leaving a model that was highly effective in terms of outcomes, dollar value and return on investment to now be replaced with an uncertain model.

“For half a million dollars or less (Business Cape Breton has) been providing a full, effective service and that’s a plus,” he said.

“We’ll now enter a phase of uncertainty with no priorities and outcomes expected and that’s unfortunate.”

Gosh, poor Mayor Clarke, he’s so busy, what with the PC leadership race and all, he must have forgotten the Department of Municipal Affairs announced the move to a “regional enterprise network” system for economic development in 2012, as in, two governments ago. It was a decision made by NDP Premier Darrell Dexter after the feds cut funding for all economic development organizations in Atlantic Canada, announcing they preferred to provide such funding on a project-by-project basis.

Clarke really should remember that, though, because he was working for one of those economic development organizations at the time the cuts were announced — he’d been hired in 2011 by Lannon-Oldford, then CEO of BCB’s predecessor organization, the Cape Breton County Economic Development Authority (CBCEDA), on a three-year contract at $135,000 a year based on a 29-hour week. Who forgets a gig like that?

Of course, he left after a year to run for mayor of the CBRM, a post he won in the fall of 2012.

So the REN plan was in the works from the day he entered the mayor’s office and although it took some time to get it up and running, Clarke looked pretty enthusiastic about it in this 2014 photo with his REN 6 buddies:

By February 2016, the Cape Breton Island REN had a board of directors — including Gratten (Duke) Fraser — a total budget of over $800,000 (half supplied by the provincial government) and two “service delivery” agencies — BCB and the Cape Breton Partnership.

And then in May 2016 — and this is something the Post doesn’t mention in its coverage — Mayor Clarke went to a meeting of the REN 6 Liaison and Oversight Committee with a surprise request. As committee chair (and Victoria County Warden) Bruce Morrison told me in an email in February 2017:

At the May 26th meeting of the Liaison and Oversight Committee for REN 6 Mayor Clarke indicated CBRM…no longer wanted to be a partner of the REN. A motion followed later in that meeting, was passed that the  REN would not require a year[‘]s notice from CBRM to exit the REN.

On 8 June 2016, Clarke went to CBRM council, which had known nothing of his plans to exit the REN, and demanded councilors rubber-stamp the REXIT and further, agree to “approve the Business Cape Breton (BCB) Business Plan and Budget as presented; and to designate Business Cape Breton as the sole economic development entity for CBRM.”

Clarke told council the decision had been made because the CBRM was paying too much in HST for services performed by the two REN delivery agencies.

And then he said the province would be asked to provide matching funds to BCB, in effect treating the CBRM as a separate REN.

Only, the province wouldn’t.

 

Tail wags dog?

The request the CBRM should “look at establishing itself” within the REN network was contained in a January 2018 letter from Municipal Affairs Minister (and MLA for Sydney Whitney-Pier) Derek Mombourquette to the CBRM. It was discussed during the regular February meeting of the CBRM council (as was a request from BCB for enough funding to get it through to the end of March):

Council_Feb27_BCB_001

 

Having listened to Mombourquette on CBC Information Morning on Wednesday, I think the DMA is now prepared to give Mayor Clarke what he was after in 2016 — that is, REN status for the CBRM. It sounds like the CBRM will not be expected to rejoin REN 6 with Victoria, Inverness and Richmond but will instead be treated as a separate “economic zone.”  Mombourquette said he has told mayor and council he is prepared to craft a REN structure that works for the municipality.

Which makes the mayor’s “disappointment” with the offer hard to understand.

Mombourquette said the REN structure is how the provincial government provides “long-term, transparent” funding to municipalities. The province gives the money to the CBRM, the CBRM decides what it wants to do with the money and then hires an outside agency to carry out the work.

Contrast that with the way funding for the Glace Bay and Area Revitalization Plan was secured: council, as best I can tell from the information I was able to FOIPOP from the CBRM and the province, didn’t choose that program — BCB did. Rudderham, as BCB board president, lobbied then-Transport Minister (and Glace Bay MLA) Geoff MacLellan for funding.

Economic Development Manager John Phalen’s role was to take information he was provided by Lannon-Oldford and draft and send an email to DMA Deputy Minister Kelliann Dean requesting $225,000 for the revitalization project. Phalen began his request this way:

I am following up in regard to discussions that the board of Business Cape Breton have had with the province in regard to a number of strategic projects they can pursue.

This is the sort of non-bureaucratic system Rudderham seems to be advocating — the board of BCB, a group of unelected local businesspeople, negotiating for economic development funding directly with the province. BCB acting not as a “delivery” agency, but as an arm of the CBRM. It would be like having your building contractor a) choose your home reno project, b) go to the bank and withdraw money for it on your behalf, c) pocket half of it (which BCB did, taking roughly half the money for administering the study).

That’s a classic case of the tail wagging the dog.

At the February meeting, CAO Marie Walsh told council the CBRM would “keep [BCB] whole” through the end of March, paying them $34,000 to “facilitate” an economic review (something else requested by Mombourquette). After that, Walsh said council can decide how it wants to proceed as far as economic development funding is concerned.

And clearly, that’s what council is now doing.

 

Deliverables

I have seen enough episodes of The Walking Dead not to count BCB out. The agency could emerge from behind a burned out taxi cab any minute now with a proposal to eat the CBRM’s brains provide economic development services.

But if it does, I’m hoping what Phalen told the Post  is true, namely that:

…CBRM staff came up with the new approach and terms of reference of what they want to get done in economic development for the year.

“It will be specific and it will be laid out exactly, what tasks and deliverables we’ll be looking for,” he said.

“We’ll put that out and we’ll get proposals from interested parties and we will evaluate that and bring it to council. Council will make the ultimate decision.”

Don’t get me wrong, I have about as much faith in regional economic development as I have in the Great Pumpkin — I mean, BCB has been around in one form or another since 1993 and yet look at these headlines from Tuesday’s edition of the Post (online):

I think we need a serious re-think about what economic development even looks like, when we’re willing to dump hundreds of thousands of dollars into an agency that helps people write business plans while refusing to assist a theater that employs people, spends money locally and draws people into the downtown core we’re supposed to be so concerned about.

But if we are going to dump money into economic development,  we should do it in as transparent a manner as possible.

 

 

 

 

 

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