Here’s how your city manages your business

Posted October 14, 2012

For some time there has been reluctance on the part of many businesses to come to Guelph and set up shop. In fact, there have been two independent consultant’s reports that Guelph city hall is a difficult place to do business.

There have been major corporations wanting to establish in Guelph, thereby creating jobs that have given up dealing with the city. They cite delays in applications, onerous regulations, generally dealing with an attitude that they are being done a favour.

The absence of common sense and good business practices prevails in many transactions. It illustrates that the lack of experience by the administration to act on behalf of the taxpayers instead of their personal agendas.

Here are three case studies that have recently come to light.

The first concerns the former civic museum building. Last summer, two bidders for the property approached the city. One of the bidders was a couple that expressed a desire to convert the heritage building into an arts and media centre for local artists.

The city had listed the property for $949,000 in January 2011, with a broker. In June of this year the city received two offers for the property. One was not identified but the other, Tyrcathlen Partners, made a presentation to a closed session of council that was supported by Guelph Civic League founder, James Gordon.

Yes, that’s the same James Gordon who ran in the last Federal election under the NDP banner. He is an unabashed supporter of Mayor Karen Farbridge.

Council accepted the Tyrcathlen offer, believed to be less than $700,000. Provided the deal closed by July 6. What followed were postponed closings, culminating with a new closing date on November 30, four months later.

Why is the city being so charitable toward this group? With another bid on the property that was considerably more than the Tyrcathlen Partners, why is the city being so amiable and accommodating? Suppose Tyrcathlen cannot close the deal, what happens if the city goes back to the other bidder and offers the property? Why would that bidder offer his original bid when he discovers the low ball bid the city accepted from Tyrcathlen?

This is how political favouritism trumps good business practice and the taxpayers are the victims.

*            *            *            *

The second case study is about the sale of city property in the Hanlon Business Park. The city investment in these lands is more than $10 million.  Peter Cartwright, the industrial promotion manager, who is selling the property, told the committee responsible that the cost to the city to develop the more than 400 acres was $266,000 per acre.

He said sales have been completed totaling 14.8 acres One parcel of 2.1 acres sold for $265,000 per acre. The other, 12.7 acres, was sold for $255,000 per acre.

The manager told the committee that the city had to competitive with Waterloo Region and the Greater Toronto area.

He is recommending that the council approve a per-acre selling bracket of $300,000 and $325,000.

What future interested organization would pay in that range after knowing that the previous sale price per acre was $45,000 less than the city’s proposed base asking price?

You know, the city would be better off authorizing the sales in the business park to qualified industrial and commercial real estate experts. This would broaden the market for potential clients wishing to establish in Guelph. It will happen without the red tape and delays that has been the hallmark of the city ‘s unsuccessful attempt to sell lots in the park. This park was ready for development three years ago. It’s time to enlist the aid of professionals and get out of the way.

The curious aspect of this is that the city manager of realty services is not involved.

*            *            *            *

A final case is the attempt by the city’s waste management to try and keep the recycling waste facility open by importing feedstock from New York State and Michigan. Already the Guelph Waste Management Coalition has protested to the Ministry of Environment that the province’s recycling mandate excludes foreign sourced dry waste materials.

There is a facility open just down the road in Cambridge that electronically sorts recycles waste at a cost much less than the Guelph hand sort operation. Operated by Waste Management, one the world’s leading waste processors, it has resulted in a loss of feedstock to the Guelph plant.

Closing the Guelph sorting facility and sending the recyclable materials to Cambridge would cut the city costs by a larger measure.

Sound like the perfect solution? Unfortunately, the majority of council would not support it because of their desire for Guelph to become the epicentre of waste management, ergo sustainability.

Economics 101, if a plant is unprofitable than sell it, close it or seek a partner to lower costs. It’s a no-brainer.

Please. Three overworked administration buzzwords not to be uttered again: Sustainability, Robust and Strategic.

You’re welcome.




Filed under Between the Lines

13 responses to “Here’s how your city manages your business

  1. boomer

    lots of people know the civic league headed up by james gordon was partially responsible for landing our mayor and some members of council in place when quarrie was defeated, phone blitzes, postcard campaigns yet denials of any political affiliations whatsover…now james and his band of merry lefties are getting some special treatment of their own.

  2. Glen N. Tolhurst

    As Alice said to the white rabbit…”it gets curiouser and curiouser”.

  3. Jeff Burke

    Having worked in food processing for almost 25 years, i can tell you there were a number of firms who got fed up with the red tape of dealing with city hall— so Ferraro Rocher and mMaidstone both went to Brantford. At one time, there was a rumor that Tim Hortons would moved their corp office out of Oakville, but too much guff, so they sit in a very overcrowded and constrained site.

    • Jeff: Thanks for the examples of how city staff and council can screw up a two car funeral, er make that opportunity. It’s been going on for far too long and the finger is pointed directly at mismanagement of the administration.They just don’t get it as they pursue their own agenda and deflect business opportunities — read that jobs — at every turn.

  4. Jeff Burke

    As for the new recycling dump, who is going to protect all the valuable cargo as it rolls up from NY? And it is going to be sterile and free from, you know, medical waste, radioactivity, toxins… we all know how upright waste disposal in NY is.
    Lord have mercy.

    • Jeff: Make that: May the Ministry of the Environment have mercy! This proposal should die a decent death. We get enough U.S. garbage over the air. We don’t need solid stuff added to the mix.

  5. geo

    Call me crazy but I believe I remember the City promising that the old museum would be sold off and the money used to help offset the astronomical costs of the new museum.
    Perhaps I mis-remembered.

    • Geo: Right on. When the plan was hatched in 2007, council was told by staff that they might fetch $500,000 for the Dublin Street property. The real estate professional hired to market the property in 2011, put a figure of $949,000 on the property. Unless there is another postponement of the sale by Trycathlen, the price will become part of the public record. If the sale does go through, who put up the funding and what are the terms of the contract?

  6. dstm

    Gordon ran in the provincial election for the NDP ….what else is in error in this report?

    • dtsm: Thanks for the correction. What difference does it really make? He lost. The thrust of this piece is to illustrate that in the Guelph politic, it isn’t what you know but who you know.

  7. Jay

    “The second case study is about the sale of city property in the Hanlon Business Park. The city investment in these lands is more than $10 million. Peter Cartwright, the industrial promotion manager, who is selling the property, told the committee responsible that the cost to the city to develop the more than 400 acres was $266,000 per acre.”

    — Maybe i’m missing something, but by my math, if the city investment is $10mm to develop 400 acres, the result is $25k per acre.

    Regardless, another great example of how city hall pisses our money away. Here are some more:

    * city hall salaries
    * proposed new library
    * waste processing facility
    * new civic museum
    * outside consultants and legal fees
    * etc.,etc.,etc.
    * going easy on the university

    All of the above have been very well explored by Gerry in past posts.

    Yesterday’s Tribune highlighted segments of a Farbridge speech at a Chamber breakfast meeting where she vigorously overused the term “vending machine” in describing how city hall operates. She used words like “misunderstood” in describing taxpayers perception of city hall’s “transformation of municipal services”. My favourite, however was this little gem:

    Local government has to be tranformed from a traditioinal service provider to “an institution that also engages and inspires” and that works across pulbic, private and not-for-profit sectors “to embrace opportunities that deliver public value.”

    Do any of the things listed above fall into this category?

    Personally, I want my government to be a service provider. I don’t mind paying my share to keep the community running but lets make sure we have functional infrastrucure, reliable services and a community that provides the hardworking providers of the city’s revenue with places to unwind and enjoy life without having to deal with drunks and vagrants at every turn.

    I’m not that interested in having my government try to engage and inspire me. My career and the interests I have outside of work do that. Just do what you’re supposed to do and run the city efficiently and don’t overtax me – and don’t piss my money away on expensive projects that the public obviously doesn’t support.

    One more thing … stop catering to the students and the university by letting them believe that Guelph is their oyster. I’m tired of hearing students whine about tuition fees and debt when they can seemingly afford to get lit up every Thursday, Friday and Saturday night.

    In my day, post-secondary students didn’t have any disposable income. I don’t recall a lot of kids living the lifestyles that are so prevalent in those circles today. My point? If you can afford to spend $100 a week on booze you have no right to gripe about your debt levels.

    But then again, that over-spending, griping and moaning approach seems to be embraced here in Guelph.

    • Jay: Great summary of the Farbridge follies. Except the entertainment value is nil. It takes a lot of guts for the Mayor to paint the picture that the public services that must “engage and inspire” change for a better Guelph.

      In an ego-driven speech to the Guelph Chamber of Commerce, the mayor spoke their language as she shifted her socialistic adherence to the centre. The problem is why the sudden hew City Strategic Plan? After six years in charge when debt has exploded and the city has the reputation as a bad place to do business, there has been a sea change that is yet to be believed.

      Meanwhile back with the facts.

      This Mayor has single handedly put this city in an almost insolvable position with excessive spending on capital projects that even her own supporters didn’t vote for.

      *We didn’t ask for the city to become the garbage capital of Canada.
      *We didn’t ask for millions to be poured into the downtown area with little to show for it.
      *We didn’t ask for a $15 million civic museum to be built in a derelict building on somebody else’s property.
      *We didn’t ask for the former civic museum to be sold at a substantial discount to a group whose spokesperson was James Gordon, the Mayor’s friend.
      *We didn’t ask for paving stones for the Market Square to be imported from the U.S.
      *We didn’t ask for spending $8 million on a transportation terminal that bypassed the heart of downtown, St George’s Square.
      *We didn’t ask for six years of downtown rowdiness on weekends with no solutions. *We didn’t ask for spending $50 million plus for an organic waste processing plant and collection system.
      *We didn’t ask for secrecy of decisions developed behind closed doors at various locations.
      *We didn’t ask for obfuscation, misled comment, lack of clarity on the part of the administration.
      *We didn’t ask for a staff increase of more than 358 in five years when the population grew by only 3,000.
      *We didn’t ask for more than 129 employees earning more than $100,000 a year.
      * We didn’t ask for stringent heritage rules that block the rights of individual property owners.
      * We didn’t ask for $2 million to be spent for raised bicycle lanes on Stone Road.
      * We didn’t ask for Norfolk Street to be re-engineered to lose two lanes from Macdonnell to Woolwich.
      * We didn’t ask for a convoluted city organization that is laden with long-winded titles and a city hall that is not the people’s place in which to do business.
      * We didn’t ask for a Guelph Community Wellbeing Initiative.
      * We didn’t ask for the city to partner with downtown hi-rise developers in a tax incentive scheme that was intended for development of brownfields in the city.
      * We didn’t ask the city to increase transit costs from $31.5 million in 2006 to $53.8 million in 2011 when 87 per cent of taxpayers never use the system.
      * We didn’t ask the city why it is liable for more than $10,222,000 in unused employee sick leave that can be accumulated and paid out as a retirement bonus.

      * We didn’t ask for any of it, yet it has happened.

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