CATCH Articles:
Developer subsidy approved
Jun 28, 2010
Councillors have rushed through a $2 million dollar loan program to subsidize industrial development on privately-owned greenfield lands. The staff recommendation was a last-minute addition to Friday’s committee of the whole meeting on strategic spending, and was endorsed without debate on its features.
The Accelerate Shovel-ready Strategy for Industrial Servicing and Transportation (ASSIST) program was first mentioned in an information report to the planning committee in early March. The report indicated that staff would bring forward the program “as part of the 2011 budget deliberations” and consequently it was not debated by the committee.
The March report said ASSIST will be “a new incentive program which will address issues of risk in the front-ending process when servicing industrial land,” by loaning private owners of industrially-zoned lands up to 50 percent of the costs of preparing their properties for development.
“This financing would be provided as an interest-free loan with appropriate financing agreements executed and registered on title,” explained the report. “The payback of one-half of the loan to the city would be triggered by a property sale, in whole or in part, to an industrial end user. The other one-half of the loan to the city would be triggered by the issuance of a building permit.”
Over 1700 acres of greenfield lands are currently designated by the city for future industry, primarily in the Ancaster, Stoney Creek, North Glanbrook and Airport business parks, but their conversion to actual industrial use has been very slow. The aerotropolis proposal, if approved this fall, would add another 2050 acres of agricultural land around the airport to this supply.
Guy Paparella, the city’s director of industrial and airport development, told the March planning committee that he was hopeful of dramatically increasing the amount of “shovel-ready” (serviced) land for development, but that city monies could accelerate that process.
“I think that’s the biggest problem right now is the risk that some of these private landowners would have to take to develop,” he noted. “But if we share that risk up front, we’ve gotten a lot of good positive comments on a program that would do something like that.”
Paparella said he hoped to bring forward the ASSIST program “next year”. He didn’t elaborate on the source of the “positive comments”.
The proposal re-emerged on Friday morning [June 25] as councillors began discussing how to use $5.385 million they had set aside for strategic priorities. A four-hour meeting on January 20 had generated a list of possible projects that included general support for faster industrial development.
On Friday, staff presented a table of cost figures for the projects. The ASSIST program, although not specifically mentioned in January, was at the top of the table with a price tag of $1.5 to 3 million.
At the start of the meeting a quarter-page of “additional recommendations” was handed out to councillors without any background report. Apparently originating with general manager of economic development and planning Tim McCabe, the recommendations proposed to remove ASSIST and the Creative Catalyst arts incubator from the strategic priorities list and fund them instead with dollars previously allocated to McCabe’s department.
In that way, councillors could spend the entire $5.385 million strategic priorities fund on other things. The move sparked a lengthy debate focused almost entirely on the Creative Catalyst project, with Ancaster councillor Lloyd Ferguson asking why the city is “getting in the arts business” when monies are needed to fix roads.
A reduced allocation for the Creative Catalyst was eventually endorsed by a divided council. The same motion directed an initial $2 million to the ASSIST program’s revolving loan fund.
Then the still intact $5.385 million strategic priorities fund was divided up with $2.7 million allocated to adding twenty new pedestrian or traffic lights in unidentified parts of the city. Other monies were earmarked to complete two earlier strategic priority projects – redevelopment of 95 King Street East to a live-work space for artists, and a waterfront ice rink. Councillors also directed $1.2 million towards the establishment of a lower city seniors’ centre.