 | | Mario Lefebvre
Director
Centre for Municipal Studies |
For years now The Conference Board of Canada has been pressing this country not only to recognize the importance of its large urban centres, but to put in place policies that would allow our largest cities to reach their full potential. At a time when globalization is no longer a vague concept, but a reality, it is Canada’s cities that have to compete with global urban centres like Shanghai and Hong Kong. Running a city means more than just focusing on policing, snow removal and waste management. There are other important responsibilities, including economic development, social housing and attracting immigrants. All of these additional responsibilities are financed largely with the same old tool: property taxes. This is not going to work!
Canada’s cities are the country’s main economic engine. As go our cities, so goes the country. Cities are where more and more people live and where a large proportion of innovation takes place. If this country chooses to continue to ignore this reality, our long-term wealth will be at stake.
While the perfect model to generate a “city agenda” is hard to find, Canada could at least be inspired by what is happening elsewhere, for example, in the United Kingdom. The coalition government has determined that the United Kingdom will have to focus on transforming their core cities1 into powerful, innovative 21st century cities if it is to rebound from the global recession. The government has already taken several steps towards ensuring that UK cities fulfill their role as engines of growth. An important dimension of the UK government plan is to focus on individualized city plans rather than blanket national policies.
Over the coming years, the U.K. government hopes to work with local leaders to develop tailored "city deals" with the individual core cities sculpting much of their own regional economic growth plan. During this two-way transaction, the national government will transition certain powers and financial resources to local governments. However, cities will need to demonstrate strong, visible and accountable leadership and effective decision-making structures to receive these new powers and funding. Critics argue that the UK government will actually disengage financially with its cities under this plan. But cities can’t have it both ways, i.e. additional power and at the same time continuing to receive the current level of transfers from the U.K. government. And while the plan does provide powers to cities in terms of economic development, cities will need to ensure they put in place the appropriate institutional and strategic arrangements required to complete this task.
Another idea that could inspire Canada comes from New York State where, as reported by Bruce Katz of the Brookings Institution, a new wave of innovation in economic development is emerging at the state and local level in the absence of federal leadership on this issue. First, New York State, under the leadership of Governor Andrew Cuomo, has focused on bottom-up economy-shaping, which honors and respects the profound differences across regional economies. Over several months, 10 regional councils in New York crafted strategic plans for their regions to compete for $200 million in state funding. The distinctive strengths of disparate regions came through in every regional plan. The Regional Council competition revealed the potential for a new economic development model. Plan after plan showed the liberating effect of collaboration across jurisdictions, sectors and institutions that were either unaware of each other or locked in debilitating conflict. Beyond New York, this innovation is also directly and immediately relevant to other states that are similarly experimenting with bottom-up approaches to shaping the post-recession economy. In Nevada, a new state economic development entity is actively seeking to regionalize state strategy and implementation. In Colorado and Tennessee, Governors John Hickenlooper and Bill Haslam, respectively, have both made bottom-up economic development a central tenet of their growth strategy.
Bruce Katz goes on to argue that “if America is going to restructure its macro economy for the long haul, it will happen as metro and regional economies build on their own strengths and leverage their distinctive assets and advantages. The New York Regional Economic Development Council process presents a call not only for reinventing government but for remaking federalism.”
Undeniably, if Canada was to adopt a “city agenda”, it would have to be tailored in the same way, as the needs of its largest urban centres differ significantly. Montreal, Toronto, Calgary and Vancouver, to name a few, do not have the same requirements. Each has their own unique economic structure and there is no way that a blanket national policy could work in Canada.
But two major issues remain: the funding of our cities and identifying who would be responsible for putting forward a “city agenda”. On funding, the property tax alone will not allow our cities to take this country to the next level. The Conference Board of Canada has been urging a change in the way our cities are funded and this has to be addressed as soon as possible. With regards to who would be responsible, each province should bring forward their own “city agenda” as cities remain creatures of the provinces. But given that we are talking about the wealth of the country as a whole, couldn’t the three levels of government work together to achieve a city agenda? If other jurisdictions can work together for better results, why couldn’t we?