Andre Sullivan

Advocates say growing pains hampered Nanaimo Economic Development Corporation

NANAIMO – Core review calls for more accountability from economic development organization.

Nanaimo’s economic development corporation is still a good idea and “the right vehicle,” according to former mayor John Ruttan, who says it would be regressive to go back in house and behind closed doors.

Consultants of the City of Nanaimo’s core services review show the city has more than one possibility when it comes to economic development, such as pulling economic and tourism development back in house.

But they believe the city should keep the model the way it is today with stronger planning and accountability measures. Consultants also suggests the city – a primary stakeholder of NEDC – continue to fund the corporation on the condition that there’s a new five-year strategic and accountability plan and development of the overall Nanaimo economy.

The NEDC proposal is just two of dozens of recommendations in the core review up for public debate and discussion in the lead up to an implementation plan by city hall.

The economic development corporation, created in 2011, was spearheaded by Ruttan, who told the News Bulletin he wasn’t happy with the status quo. Economic development was handled in-house, where he said the department was too insulated and there was difficulty in getting information from staff. He wanted more public input and to lessen the burden on taxpayers.

In the final years of the city-run department, the economic development branch cost taxpayers $1.5 million annually.

Ruttan set up a 17-member board with representatives from the business sector, and under the corporation model, the city became the primary shareholder. He hoped the city would be able to lessen what taxpayers contributed with financial support from other communities without economic development offices of their own, like Ladysmith and Parksville, as well as local organizations that would otherwise not have contributed to a city department.

Today, the city contributes $1.375 million to NEDC.

The core services report says the corporation faced a number of challenges and difficulties over its first years of operation.

It indicates an inability of the NEDC to earn the full trust of Nanaimo council and administration is having an impact on the future delivery of economic and tourism development functions. It suggests that there needs to be improvement in how work gets done, communication with stakeholders and the relationship with the city itself.

Ruttan said he was disappointed in so few regional partners and hoped for more reduction in taxpayer support for the organization. But he says the chances of getting money recovered are better with this model.

“There will be challenges whenever you have another entity set up,” he said. “NEDC was a good idea at the time and I still think it’s a good idea today and I think if there’s improvements to be made, don’t be critical of the organization – implement the changes, which a council can do.”

Andre Sullivan, chairman of the NEDC, said the organization was successful at blending three groups – Destination Nanaimo, Tourism Nanaimo and economic development – into an arm’s-length organization with one brand and one mission. He also pointed out that its budget has not gone up with inflation. The organization leverages money from other levels of government and the Regional District of Nanaimo.

Sullivan said a turnover in CEOs has been a black eye on the organization and has been “brutal” on volunteers who have filled the gap.

He believes communication is good with city council, with quarterly meetings and weekly updates on activities. While the core services review talked about missteps in NEDC’s development of relationships with stakeholders, he says everybody is on the same page at the community level.

“Obviously there are friction points on various agreements but overall I don’t think we have any bad relationships,” he said.

Mayor Bill McKay couldn’t say when trust and confidence in the NEDC was lost but suggested it’s a matter of getting the right leader in the position that follows the mandate dictated by council, pointing out that there have been three different CEOs since the organization started.

However, he thinks the model is progressive and supports it and if the question is whether it’s being executed properly, fine tune it and let the NEDC get on with its work.

“Unless somebody tells me the model is not working, then we continue to fund,” he said.

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