A Commentary by Doug Draper
“None of this is free and if we say; ‘Let’s not charge (developers for the cost of development)’, then the taxpayers pay.” – St. Catharines representative on Niagara regional council, Brian Heit.
“It needs to be communicated very clearly that all property taxpayers are going to be contributing to this grant (to industry).” – Niagara regional councillor and Lincoln, Ontario Mayor Bill Hodgson.
Niagara, Ontario’s regional headquarters
What both of these elected representatives were speaking to at the January 17 Niagara regional council meeting were development charges for corporations that might move a and who pays them. And I can almost sense the moaning from readers out there now. Development charges? That sounds boring and why should I care to read on. Well you may want to for reasons that hit you and me – and all of us – squarely in the pocket book.
What Heit and Hodgson, among only a few others on the regional council were responding to at that January 17 meeting was a motion supported by a majority of the councillors to exempt industry from paying any development charges whatsoever in Niagara over the next two years, all in the hope of stimulating more industrial grown in the region.
Apparently, and I don’t think this is an unfair message to take away from the vote a majority of our regional councillors made this January to completely cut development charges for industry over the next two years, Niagara, Ontario is such a crap hole for doing business on this continent that we have to go from charging industry some of the lowest development fees in this province and country to get them even thinking about setting up shop here.
Hey, I have an idea. If Niagara is, indeed, so unattractive for doing business due to development charges, as low as they now are on a province or country wide scale, then why not also offer industry cuts on their water, wastewater and energy bills, and the taxpayers of this region will subsidies that too?
Now let me make the following point loud and clear.
I do not believe for one minute out of the more than an hour or two our regional councillors always seem to have to take to wrap their minds around this issue, that development charges have anything to do with whether or not corporations decide to move their industries to this region. In fact, study after study, conducted by some of the best experts on municipal finances in the country, has shown that development charges fall way down on the list of reasons an industry decides to choose one region over another to set up a new shop. Way up higher on the list of reasons why industries are drawn away from a region is cumbersome layers of governance, like the antiquated two-tier municipal system of government we have here with multiple layers of planning and public works bureaucracies to swim through.
But we will not deal in any substantive way with the issue of too much governance in this region, now will we. And why? Because most of the same municipal politicians who are so willing to make us pay all the costs of any kind of industrial development we might attract to Niagara, also don’t want to see the end of their own municipal fiefdoms and possibly the end of their own little municipal jobs in a region of Ontario that has more elected politicians per capita than practically any other region in the country.
So let’s go back to exempting businesses from development charges, which is a nice thing to do also because at least some of those politicians that show the most willingness to do so may also be likely to receive some nice campaign donations from commercial developers to support their next municipal election campaigns.
And how does that do the rest of us any good?
Not much, I say. There is, I repeat, no real evidence to show that having the lowest development charges in the province, right down to zero, attract industrial growth. If that were the case, Niagara, which has seen a bleeding of its industrial base over the last three to four decades, and at a time when it has had among the lowest development charges in the province, should be an industrial giant by now.
What a reduction or zeroing out of development charges do mean, and this is a certainty, is that the less industry or business pays for the cost of the roads, water and sewer lines and other infrastructure needed to accommodate their development, the more the rest of us pay for it. Like Heit and Hodgson said in their arguments during the council meeting that saw a majority of their colleagues kiss the brass ring of industrial lobbyists who would naturally not want to pay any development fees at all, there is no free ride.
If industry doesn’t pay for most or all the costs of the roads and other infrastructure they need to accommodate their development, as they have to do in Mississauga and so many other regions of Ontario, then those costs will be spread across the property tax base, including seniors on fixed income or a single mom trying to get by on minimum wages.
Apparently that is okay for a majority of our regional councillors.
Finally, and once again, I want to make it clear that I do not believe for one minute that there are not other ways of attracting new business to this great region, if our municipal leaders worked at finding them. It is sad to think that one of the only ways so many of our regional representatives can find for attracting business is to say ‘Come on in and we will charge you nothing in the way of development fees. Whip us. Whip us. Whip us!”
I believe this great region, positioned next to a busy international border and between two mighty Great Lakes, is better than that. Why don’t more of our regional politicians feel the same way?
(Niagara At Large invites those you care to share their first and last name to also share their views on this post.)
Niagara At Large 
Brave, brave, brave report, Doug ….given the last editorial on the same subject which engendered much response. It is confusing to some of us sometimes (certainly to me) and you have ‘unpackaged’ it perfectly. Thanks
A Note to Gail Benjafield from Niagara At Large publisher Doug Draper …. that was very kind of you to say brave, brave, brave, and I thank you most sincerely for saying that. but all it was is the truth, truth, truth. St. Catharines regional councillors like Andy Petrowski can say whatever they want about who or who is not a lobbyist for passing on development charges to the rest of us is. The bottomline is that the cost of building infrasture to accomodate this development has to be paid from someone. It is either paid for by the developer or it is subsidized in the form of a welfare checque by the rest of us, including that single mom and the senior couple on a fixed income. Petrowski and friends have chosen to pass what should be the fair cost of paying for new development infrasture in this region on te single mom and senior couple and everyone else in between. For him and some of his neo-con friends on Niagara, Ontario’s regional council to go on pretending that they are there to protect taxation for the little guy is bullshit. Let’s wait and see how much more they get in campaign donations from their developer friends for the next municipal election. Doug Draper
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Thank you Doug. Our politicians from municipal to federal seem to think the “little guy” can pay for everything as though we were an endless artesian well of cash. Ornge would be an example. Ski lessons and trips to Brazil, including the best hotels and meals at a couple thousand a night, are essential for the Ornge execs! As far as industries locating in Niagara the stampede of enterprise out of the Peninsula would do a herd of Bison proud. As amply illustrated, some just declare bankruptcy and take off leaving their employees hanging out to dry with no severance and no warning as just happened in Stevensville. Industry plays by its own rules, the layers of municipal and regional administrations pass the buck and to hell with us.
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If memory serves, the Region finally raised development costs more in line with other municipalities. This is one step forward and three steps back. As pointed out the bloated two tier system in Niagara is definitely a problem. Due to the loss of major industry the tax burden has skewed to a higher proportion being placed on residential rates. Industrial/commercial tax rates have increased due to this imbalance as well.
Now the residential taxpayer will be burdened once again for dubious benefit. The systemic economic malaise that Niagara faces requires the assistance of the provincial and federal government and innovative thinking at the local level, not, I repeat not putting it on the backs of Niagara’s residential ratepayers.
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The whole development charge issue is not confined to Niagara Region.
I applaud Doug’s comments and hasten to point out that here in the Hamilton area, there are many councillors who cannot do enough it seems to reduce or remove development charges for corporations and developers. They have mastered the art of what I refer to as “political fellatio.”
Seriously, development charges are supposed to pay for the installation and upkeep of municipal services that are installed or expanded to help these companies do their development etc. Instead, at least here in our area, the development charges are used to try to do some small repairs to infrastructure in the older areas that has been neglected too long while councillors scurry about trying to promote their grandiose ideas. Hamilton and Niagara could be wonderful places to live. Unfortunately, the elected officials in both regions can’t seem to focus on looking after what they already have, focussing instead on whatever pipe dream they think will bring “greatness” or “world class” or whatever other buzzword you want to insert.
A pox on all of them!
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The following article in a Buffalo newspaper illustrates the just what we are facing.
The bankrupt State of New York has discovered the value of industry creating jobs as opposed to the cost of poverty
Welded Tube moves closer to a $50M Lackawanna project
Business First by James Fink
A Canadian firm has agreed to invest more than $50 million in building its first U.S. operations in Lackawanna, N.Y.
Welded Tube of Canada Inc. Cleared one of its final hurdles when the Erie County Industrial Development Agencies board unanimously approved an incentive package to advance the project.
Welded Tube is a manufacturer of cold-formed carbon and low-alloy tubular-steel products currently operating in Welland, Ontario.
Welded Tube is moving their operation to a 40 Acre site inside the Tecumseh Business Park in Lackawanna, N.Y.
Once fully developed, the property will generate an estimated $996,000 in property taxes and new JOBS for LACKAWANNA, N.Y.
Products made in the Lackawanna plant will be shipped to Welded Tube’s Welland, Ontario plant for finishing on a temporary basis. Once the N.Y. finishing plant is completed, EVERTHING will be processed in Lackawanna and then shipped to the Company’s clients.
Besides the ECIDA incentives, which include $6.8 million in property tax savings and $850,000 in mortgage and sales tax breaks, the company will be receiving assistance from the Empire State Development Corporation including utility breaks.
A Note from Niagara At Large publisher Doug Draper – I wish to thank Preston Haskell for sharing the above article from the Buffalo, New York publication Business First, because it is a very important one that deserves throughtful attention and discussion. It is also an excellent illustration of what regions in Ontario jurisdictions across North America, in both Canada and the United States, face as we find ourselves competing for whatever industry is left that has not moved all of its operations over to China and other countries in the middle and far east where rock-bottom wages and benefits (to the extent there are any benefis) rule the day.
Now, with our free trade agreements making it easy for companies to move their operations anywhere, we are increasingly witnessing provinces, states and municipalities doing everything they can to subsidies the cost of services in their jurisdictions (meaning that the rest of us, as individual taxpayers, are left paying those costs) and keeping wages and benefits down by whatever means, including union-busting strategies like those Orwellian right-to-work laws that allow union members the option of not supporting unions through the payment of union dues.
It is a great time for industries that are free, through trade agreements, to move anywhere they want and it is a terrible time for employees who cannot do the same thing. In other words I, as a Canadian citizen, could not get a job working for that Canadian firm moving to Lackawanna, New York, unless I were able to get a green card from the U.S. government, allowing me to work in that country, and just try getting a green card these days. Yet that Canadian firm will still be marketing its products here and hoping that I will still have enough money in my pocket to buy them. Something is wrong with this picture and I think we need to have a full, open discussion on where we are going. I will see what I can do to provide a venue for such a discussion on Niagara At Large in the days ahead. Doug Draper, NAL publisher
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Thank you for bringing this issue up Doug.
Frankly/sadly does anyone expect anything better from our regional and municipal governments? This is the tip of the iceberg with respect to their incompetence, disconnect from reality, lacking negotiating skills and of course conflict of interest as it pertains to lobby groups and the financial support they provide to politicians to fund their election campaigns.
We need new government and we need it now.
Sadly just sayin….
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Doug
Factual and SO true
A few short years ago I was totally shocked by an article that appeared in a local rag, an article that stated the Development charge at the time for a single family dwelling in the NIagara Region was less than $10,000 and that the taxpayers ACTUALLY paid half or amost half of the charge’
SO
I began to inquire into the Development cost factoring as it applied to other regions of this province.
(1) I was informed by the Building department of the Halton Region that the DEVELOPMENT CHARGE was $32,000 per single family home
(2) I was also informed by the Building dept of London, Ontario that the DEVELOPMENT CHARGE was $22,000 for a single family home
A few short years ago the Regional of Niagara decided to raise the DEVELOPMENT CHARGES and drew opposition from certain members of the Regional Council. I was informed and questioned about One mayor, Regional Council member who even though his father-in-law was/is a developer made a motion that was defeated to delay implimenting the increase.
I was also informed that while this meeting was taking place some developer’s vehicles were circling the Building????
We the taxpayers get it Municipally and we get it Regionally and NOW both Councils are subscribing to eliminate debate and taxpayers rights to freedom of discussion.
Halton is a bee hive of Industrial Growth as is London so I guess the old adage applies ”HOW CAN WE SOAR LIKE EAGES WHEN TURKEYS RUN and CONTROL THE SHIP?”
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No I do not owe allegience to ANY political Party whether it be LIberal, Conservative (I at one time respected the “OLD Progressive Conservative Party but thed Progressive has been removed by the actions of Harper’ buddy Peter MacKay)
Pierre Elliot Trudeau (a much hated by the Right Wing Groupees) Prime Minister of Canada instituted FIRA, a law that basically made any International Corporation doing Business in and with Canada must have a presence in Canada…Mulrooney scrapped this and started to sell off Canada to the highest bidder.
Happer has magnified this sell off to mean “Anyone or Corporation” that has the money literally own Canada..
A decade or so ago Dofasco decided to build a Steel plant in the USA
Wow the bidding was beyond belief between Kentucky, Ohio, Wisconsin .. Kentucky won the bidding war giving Dofasco about $400,000,000 in breaks.
I was at this plant once years ago and found it is state of the art and is located on the highly toxic area of the Ohio River.along with chemical plants etc etc,
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So much truth here. Also a thank you to Mr Haskell. With the “right to work” laws businesses will prosper and the middle class, such as it currently is, will become extinct. The problem is, who will then be able to purchase the goods produced? When that happens the economy will tank big time. No purchasing power, no economy.
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Regarding the comments from Mr Haskell and Doug about the Welland business moving to the States …
I don’t give a rats backside about treaties etc in this type of situation. That company should be barred from selling products in Canada, and its property should be taken over by the government.
Don’t like it? Too effing bad! Be a good corporate citizen, not a money grabbing opportunist.
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I agree with Gail above – it’s a brave article.
I was following your previous article and I would probably vote for someone like Andy Petrowski and agree with the decision made by the majority of our Niagara Regional Councils last week.
Mr. Draper, I’m not sure how conscience you are of this but when you argue that elected officials are making decisions favouring the rich and pointing out questionable relationships between regional councilors and developers, it starts to sound a lot like Marxism.
It was Karl Marx after all that spoke about the conflict between the ruling class and the lower classes and spoke against what he called the “Dictatorship of the Bourgeoisie”.
Have you considered that maybe this is why the majority of regional councilors voted the way they did. Maybe they believe there’s more to governing a community than seeing their decisions as part of a struggle between the rich and poor?
Any time I’ve been in group where we accomplished something significant, it was because the people involved worked as a team and cooperated. Personally I’d like to applaud Mr. Petrowski for what he did and if he convinced others to agree with him they’re smart too.
Just sayin.
A Note to Mr. Jantz from Doug Draper – If I am a Marxist for arguing that developers, rather than seniors (and given the demographics in Niagara, we have many of them) struggling to pay their rising property taxes and heating bills to to stay in their home, pay a fairer share of the costs of doing business, then what does that make Mississauga Mayor Hazel McCallion (a proud long-time Tory) who has always believed in developers paying the full cost of the infrastructure needed to accomodate their building projects, and what does that make so many other mayors and regional councils across southern Ontario that require developers to pay a higher share of the cost of development than Niagara does?
By the way, if I thought Mr Jantz was comparing me to Groucho Marx, I would be flattered. On the other hand, I must take issue with using tired-old rhetoric from the Cold War era, including colouring someone as a Marxist (a quite obvious code word for “red” or “commie”) to taint or discredit anyone who is simply asking for more fairness around paying for services in our communities.
By the way, I don’t know what Mr. Jantz means when he talks about ‘working as a team’. Any team I ever belonged to saw all of its members digging into their pockets and paying their fair share. I never belonged to a baseball team that asked 14 of its 16 members pay all the cost for field and equipment rental and let the other two pay little or nothing, and that is what we are talking about here.
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