CVRD initiates discussions about Economic Development Society reforms

CVRD initiates discussions about Economic Development Society reforms

by | Oct 27, 2020

Comox Valley Regional District offices now located on Harmston Avenue in Courtenay  |  George Le Masurier photo

CVRD initiates discussions about Economic Development Society reforms

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Directors of the Comox Valley Regional District have initiated discussions to explore new models for delivering economic development, destination marketing and Visitor Center operations that could potentially realign the Comox Valley Economic Development Society, or even replace it.

It will be the first time in the society’s 32-year history that regional directors have considered reviewing the original model of an arms-length society governed by an independently chosen board of directors.

The consideration was reached toward the end of a two-day workshop held Oct. 13-14 at the regional district’s new offices on Harmston Avenue in Courtenay. The session was facilitated by an outside consultant after conflicting visions for CVEDS’ future had brought the board to a stalemate.

The CVRD created the Economic Development Society in 1988 and continues to fund it. In recent years, CVEDS has received more than $1.2 million per year from Comox Valley taxpayers.

But it had become apparent over several years that CVEDS had lost the trust of some elected officials as well as individuals, nonprofit organizations and businesses across sectors of the Comox Valley. 

CVRD directors seeking change from CVEDS have mentioned the need for more accountability, transparency, especially in financial matters, and whether the society’s recent activities still remain relevant and consistent with the Comox Valley community’s environmental and social values.

During the workshop, Area A Director Daniel Arbour noted that four out of the five Comox Valley jurisdictions funding CVEDS had “at one time or another” considered reviewing or withdrawing their participation, for various reasons.

FURTHER READING: Go to our local government page

He was referring to his own electoral area, Area B, the Town of Comox and the city of Courtenay as those who have at least thought about withdrawing. Electoral Area C is the fifth participant currently funding CVEDS.

Any electoral area or municipality can opt-out of CVEDS participation by giving six months notice. That is still an option under the new contract signed in July. But it is less likely in the near future considering the new agreement expires in two years, on Dec. 31, 2022, and the possibility that regional directors might agree on some reforms.

The Village of Cumberland withdrew support for CVEDS in 2015 and hired its own economic development officer. That became a trend on Vancouver Island as other regional districts and municipalities moved toward new models that separated destination marketing activities from economic development services. 

The CVRD’s consideration of new models would presumably explore whether to handle the three key functions of CVEDS — economic development, destination marketing and Visitor Information Centre management — with in-house staff or to contract for them with an external entity, or some hybrid combination.

Workshop facilitator Gordon Macintosh, the former Islands Trust executive director, urged CVRD directors to decide soon if they want to explore new models for delivering the services provided by CVEDS.

It was important, he said, for directors to reach consensus and to have preferred options in mind before having to give CVEDS notice of the regional district’s long-term intentions next December.

Directors did not take any formal action or vote during the workshop. It’s expected that will happen after CVRD Chief Administrative Officer Russell Dyson presents a staff report with recommendations to the board.

 

WORK PLAN CLARITY

While the second day of the workshop focused on developing a process for reconsidering the strategic future of the Comox Valley Economic Development Society, the first day was designed to give clarity to CVEDS’ 2021 work plan and how regional district directors would measure their success.

Meeting by themselves in the morning, CVRD directors created a list of topics directors would like CVEDS to consider adding into their 2021 work plan. A few CVEDS board members and Executive Director John Watson joined the workshop in the afternoon.

Most of the topics were related to a feeling that CVEDS activities should acknowledge the Comox Valley community’s values, and weave the regional board’s four core values into their business relationships:

  1. Reconciliation and First Nations relations;
  2. Financial responsibility;
  3. Climate change action; and,
  4. Community partnerships. And that they should weave these into their business relationships.

Asked to imagine their ideal economic development function, CVRD Board Chair Jesse Ketler said she envisioned a current and forward-thinking group that “was on top of the shift in societal values.”

“CVEDS was created in the 1980s when everyone was talking about deregulation and free-market capitalism. The only goal then was short-term profit and the result was social/wealth inequality and environmental degradation,” she said. “People now realize that we have to look at the long game and that sustainable businesses are those that consider environmental and social values.”

Ketler said businesses that included social and environmental values into their business model were doing better through the COVID pandemic than those that didn’t.

“People want to be a part of something good. If we try to apply ‘80s style solutions to COVID-era problems we are doing the businesses in the Comox Valley a great disservice,” she said.

Courtenay City Councillor Wendy Morin added that “the polarization on the board, although appearing along political lines, is a simplistic view. Many of us see that economic development practice is shifting, regardless of the politics of the day.”

CVEDS has about six weeks to respond to those requests — either to agree to do them, ask for more resources in order to do them, or to defer them — before its 2021 work plan and accompanying budget receive final approval from the CVRD board.

The topics included: Childcare, event guide and promotion, E-marketplace feasibility, destination infrastructure, co-working spaces, green industry, an arts and culture plan and an agriculture plan.

 

OPINIONS DIFFER

Although the perspective on CVEDS differs among all 10 of the regional district directors, at their simplest they break down into two groups: those who are happy with the current CVEDS structure (Town of Comox, Area C) and those who are less happy (City of Courtenay, Area B and Area A).

Courtenay City Councillor Wendy Morin wondered how the board could overcome entrenched positions based on geographical self-interests.

“How do we get to some common ground when there is such a disconnect between the experiences of Comox and Courtenay in the level of response on pet projects,” she said at the workshop. “Why are some areas getting what they want (from CVEDS) and others are not? How are we going to satisfy all these interests on a regional level?”

Differing perspectives based on territory emerged clearly during a discussion on the importance of mountain biking to the Comox Valley economy.

Comox Councillor Ken Grant said he had trouble with CVEDS spending tax money to promote mountain biking because it benefits Cumberland, which doesn’t help fund CVEDS.

But several other directors said mountain biking benefits businesses across the whole Comox Valley, yet Cumberland bears the burden of maintaining and improving the infrastructure of the most popular trails that bring tourists to the community.

“I have trouble with that. Our marina is the biggest economic driver in the Comox Valley,” Grant said. “So we could ask for money for that, too? Not sure we want to go down that road.”

But Area B Director Arzeena Hamir pointed out that Comox is seeking help from CVEDS and other jurisdictions to build out more parking infrastructure at the Comox Airport.

Similar differences of opinion occurred during discussions on other topics.

Comox Mayor Russ Arnott said Comox business owners had no lack of confidence in CVEDS.

“I guess it depends on who you talk to,” he said.

Area C Director Edwin Grieve said he was troubled by the undercurrent that “something untoward is going on.”

“These people (CVEDS board members) stepped up as volunteers. It’s disrespectful. It’s why directors have resigned. We owe them an apology,” he said.

Chair Ketler talked about the need to “relocalize” the Comox Valley economy.

“One way to do that is through social procurement and supporting social enterprise,” she said.

 

 

 

 

 

 

 

 

 

ABOUT THE WORKSHOP

When CVRD directors failed to find agreement in March on what they wanted from their $1 million-plus funding of the Comox Valley Economic Development Society, regional district staff suggested a workshop designed to break the logjam. But the provincial lockdown to stop the spread of the COVID virus derailed those plans.

Board Chair Jesse Ketler revived the workshop idea this fall and Gordon Macintosh, president of the Local Government Leadership Institute and the former executive director of the Islands Trust, was hired to facilitate it.

It’s possible that Macintosh would return to help CVRD directors navigate through the process of exploring new models for providing economic development and destination marketing services, and how to manage the Visitor Information Center operations in the future. But directors have only initiated discussions so far and have not taken any official actions.

 

 

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City CAO David Allen focuses on sustainable asset management

Courtenay Chief Administration Officer David Allen was part of a small group in 2008 that developed this system for managing public assets that provides for service and financial sustainability. It is now used by almost every municipality in British Columbia.

Tensions rise as Liaison Committee explores integration for CVRD, CVEDS

Tensions rise as Liaison Committee explores integration for CVRD, CVEDS

by | Oct 9, 2020

A display inside the Comox Valley Visitors Centre, which now houses the CVEDS offices  |  George Le Masurier photo

Tensions rise as Liaison Committee explores integration for CVRD, CVEDS

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Members of a committee investigating the potential for integration of Comox Valley Economic Development Society (CVEDS) operations with the regional district agreed on a short list of possible shared services at their inaugural meeting last week.

The committee instructed Comox Valley Regional District and CVEDS employees to consider collaboration on financial accounting, the audit process and related costs, office space, website and communications and human resources including staff evaluation and training. Visitor Centre operations were also seen as worthy of discussion by the committee and a presentation on the topic was requested for the next meeting.

But there wasn’t complete agreement or clarity on the larger issue of the scope of the committee’s authority and responsibilities. 

Deana Simpkin, president of the CVEDS board, asked whether she and board members Mike Opal, Bruce Turner and Paul Ives were full members of the committee or serving in an advisory capacity. Turner wondered if the board’s role, in general, had been changed.

In his opening remarks, Committee Chair Doug Hillian addressed that issue saying he hoped the group would work collaboratively and that their work would result in a closer relationship between CVEDS and the CVRD.

“This is uncharted territory, there have been significant contract changes,” Hillian said. “The rationale is that the relationship in the past has not been as close as it might be and this has led to conflict.”

Hillian assured CVEDS board members they were full participants in the Liaison Committee and called the committee’s work a “shared responsibility.”

And he added that “nothing was off the table” for discussion and invited “general comments” from everyone.

But tensions rose when Area B Director Arzeena Hamir commented on the committee’s responsibility “to collaborate in the ongoing review and clarification of contract deliverables,” according to Section 15 of the new CVEDS contract.

And she later asked CVEDS Executive Director John Watson a series of questions about a late three-month report, why minutes of the Economic Recovery Task Force haven’t been made public and why the society hadn’t held a required Annual General Meeting in 17 months.

That didn’t sit well with CVEDS board member Paul Ives who characterized comments about “deliverables” — actions required by the contract — as committee members “taking shots at each other.”

“I’m troubled by this line of questioning,” he said. “Why are we putting CVEDS staff on the hot seat? The CVRD questions are inappropriate.”

Hamir responded that it was “definitely within the purview” of the committee to ask questions of staff and appropriate to check on contract deliverables.

Chair Hillian said if the committee was going to work collaboratively and with transparency, then questions could be asked. CVRD General Manager of Planning Scott Smith also approved the questioning.

Hillian suggested CVEDS could answer Hamir’s specific questions at the next committee meeting when he hoped Watson could “attend the whole meeting.” Watson came late via teleconference to the first meeting and left early.

 

COMPLAINTS ABOUT FUNDING

CVEDS board member Bruce Turner, who attended via teleconferencing, said that reduced funding from the regional district had made it impossible for the board to meet its fiduciary responsibility. He and other board members said the new budget was hampering operations and that a reduced staff didn’t have time to fulfil all their reporting requirements.

Simpkin said there is “a backlog behind the scenes” because one staff member chose to leave and CVEDS had laid off three Visitor Centre staff. The society currently has eight staff members.

She said this lack of resources has put pressure on staff, many of whom are working from home.

For CVRD Director Hamir, the funding concerns raised the question of where regional district responsibility ends and where CVEDS responsibility begins.

“Both boards were aware of the terms of the agreement when they signed the contract, including the funding,” she said. “The contract spells out what needs to be done and when. The ‘how to do it’ is up to CVEDS. These are separate jurisdictions.”

CVRD Director Maureen Swift said the funding issue was the purpose of exploring greater integration with the CVRD.

“CVEDS can’t operate as it has in the past with the new contract,” she said.

Hillian closed the meeting hoping for better collaboration.

“It’s inevitable there would be a little tension considering the difficulty in getting to this point,” he said.

 

WHAT’S NEXT

When CVRD directors couldn’t agree on CVEDS future by the March 31 contract deadline, they chose to sign a two-year agreement with the understanding that the matter was unresolved. That agreement provided for the formation of a Liaison Committee comprising members from the CVRD and CVEDS boards as a means to assure better communication and that deliverables were meeting CVRD expectations.

The next meeting of the Liaison Committee is at 1.30 pm on Oct. 19.

Meanwhile, the CVRD board is holding a two-day workshop next week in an attempt to find common ground among directors about the future of economic development.

 

 

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A shifting political climate means change for 32-year-old society, but board still divided

A shifting political climate means change for 32-year-old society, but board still divided

by | Oct 2, 2020

Responsibility for management of the Comox Valley Visitors Centre is one of many items under discussion by CVRD directors 

A shifting political climate means change for 32-year-old society, but board still divided

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Achanging political climate that brought new faces and fresh perspectives to the Comox Valley Regional District boardroom has thrust the three-decade-old Comox Valley Economic Development Society into an uncertain future.

And that uncertainty has been compounded by a regional district board that appears to have been ill-prepared to renegotiate the society’s existing contract by its March 31 expiration date.

Ten months after serving notice last June of its intent to enter contract negotiations, the board still struggled with an irreconcilable diversity of opinions about whether the Comox Valley Economic Development Society (CVEDS) should be scrapped, tweaked or left in its present form.

And further hampered at the last minute by the COVID pandemic, regional directors ultimately punted its decision-making into the future.

In the interim, the CVRD signed a revised two-year contract with CVEDS provided less funding and made more demands for accountability.

“It was a poor process. Guilty as charged,” CVRD Director Doug Hillian

They also created a three-director Liaison Committee to review the society’s performance and explore new models for delivering economic development, destination marketing and Visitor Centre management.

The regional district originally created the Economic Development Society in 1988 as an arms-length organization with its own governing body to “… encourage the responsible expansion of the Comox Valley economic base.”

Operating under the guidance of its own hand-picked board of directors, the society ballooned into an agency for destination marketing and industry event productions.

But the 2018 municipal elections brought a new, more progressive political perspective to Courtenay’s municipal government and to some rural electoral areas and created change that eventually spread to the regional district.

The old status-quo regime was out. Younger and more progressive thinking was in.

Two years later, that new political climate has begun to impact the Comox Valley Economic Development Society.

Blank cheque, free rein and unquestioned allegiance are now out. Financial transparency, increased scrutiny and meaningful performance reviews are in.

 

A REGIONAL BOARD DIVIDED

In June of 2019, the Comox Valley Regional District announced its intention to renegotiate their existing five-year contract with CVEDS, which was due to expire on March 31, 2020. That gave elected officials more than nine months to gather the information they needed to assess the effectiveness of the 32-year-old society and chart a course for its future.

But by the expiry date, the board had not yet held sufficient meaningful discussions to produce a majority view about how or whether to revamp CVEDS.

Sensing the philosophical divide and without clear direction from directors, CVRD staff did not push the board for a timely contract decision. Nor had the board garnered helpful information from a consultants report that had been conducted on narrow, contract-specific terms of reference.

CVRD Director Doug Hillian said he was “disappointed” in the evaluation. For starters, the consultants delivered their report late, well past the Dec. 31, 2019 deadline. Hillian said it was one of the factors that delayed the contract negotiations.

“I had hoped the full report would have given more insight than it did,” Hillian told Decafnation. “It was unsatisfactory on every level.”

“Economic development has been at arms length, in its own silo, for so long, but we’re understanding now that it needs to be part of the whole,” CVRD Chair Jesse Ketler

CVRD board chair Jesse Ketler agreed.

“The performance review was purely contractual and was no help to directors in reaching agreement on how to approach the CVEDS contract,” Ketler told Decafnation. “In fact, in some ways, the report made the problem worse.”

Without a guiding document, the discord among directors became a stalemate.

“There was disagreement among directors on how to proceed with CVEDS and the conflict was tense,” Ketler said.

The CVRD board did have discussions during which numerous aspects of CVEDS were identified that people wanted to be examined or changed. But no director ever made a motion or proposal to either seek a new model or to sever the contract with CVEDS.

However, as the contract deadline approached, staff initiated the idea of holding a board-only workshop to get directors on the same page about the best way to handle economic development, tourism marketing and Visitor Centre management.

But before the workshop could take place, the COVID virus struck. The workshop was cancelled and dealing with the pandemic lockdown became the board’s priority.

Just this week, the CVRD board rescheduled the workshop for mid-October.

“It was a poor process. Guilty as charged,” CVRD Director Doug Hillian told Decafnation. “There was not enough in-depth discussion until it was too late due to failings of the performance evaluation and the onset of the pandemic.”

“It would have been helpful to have had a working committee and the workshop much earlier.”

So the hope of reaching a long-term plan for economic development and other services was made more difficult, according to Board Chair Ketler.

“But the board felt it needed to do something in the short-term to respond to COVID,” she said.

The answer was to form the Economic Recovery Task Force while continuing to negotiate a new contract with CVEDS.

The CVRD and CVEDS finally reached an agreement on July 27, four months past the expiry date. The two-year contract required CVEDS staff to provide administrative support for the Economic Recovery Task Force.

(Editor’s note: See the sidebar information on this page.)

Among other changes, the new agreement included the formation of a Liaison Committee of the CVRD board to continue discussions with the CVEDS board of directors about its future, and to review and clarify specific deliverables required in the contract.

 

A CONTENTIOUS COMMITTEE

During a contentious meeting on August 25, the CVRD board selected three directors to form the Liaison Committee: Chair Doug Hillian, Area B Director Arzeena Hamir and Comox Director Maureen Swift.

At first, Area C Director Edwin Grieve proposed Hillian, Comox Director Ken Grant and Area A Director Daniel Arbour to form the committee. But several directors opposed this composition, including Courtenay Director Will Cole-Hamilton.

“Over the next two years, there is the opportunity to see if this model is sustainable or not,” Hillian

“I will vote against this composition. There are different schools of thought around this table that were quite divisive during the course of our sessions,” he said at the August meeting. “This group of people — and I count myself among them — have reservations about this agreement and it would be good to have representatives on that (liaison) committee who clearly represent that viewpoint.”

Cole-Hamiltion added that the board will only come out of the process united “and with a clear conscience if the full spectrum of viewpoints is represented appropriately and respectfully.”

That led Grant and Arbour to withdraw their names from the nomination.

Grant said he was stepping out because he couldn’t “see this going in any way” to make the CVEDS service better.

Comox Director Maureen Swift and Arzeena Hamir were then nominated, with Grant and Swift cast the lone votes against adding Hamir to the committee.

 

HILLIAN, KETLER ARE OPTIMISTIC

Despite its rough start, Hillian told Decafnation last week that he’s optimistic about what the committee can achieve.

“This opens the door for discussions about whether CVEDS is in sync with community and board values, whether the relationships impacted over the years are salvageable — whether this is a structure that the board wants to continue investing in for the long-term,” he said.

Board Chair Ketler believes the values of CVEDS need to align with the changing values of our community and that of the CVRD board.

“Economic development has been at arms length, in its own silo, for so long, but we’re understanding now that it needs to be part of the whole,” she told Decafnation. “We see that now especially with COVID — things like housing, food, health and a safe environmental are all foundational to economic prosperity.”

Hillian hopes the committee’s work can answer questions “such as personnel, operation style and is it the right structure.”

“Over the next two years, there is the opportunity to see if this model is sustainable or not, while also working toward better integration and communication,” he said.

 

 

 

 

 

 

 

 

 

 

HIGHLIGHTS OF THE NEW CVRD-CVEDS CONTRACT 

The Comox Valley Economic Development Society has historically benefited from five-year contracts, more than a million dollars in local taxpayer funding and sparse oversight. Their new contract with the regional district, valid for just two more full years, looks dramatically different.

Under the new terms of the agreement signed July 27, the CVRD has, among other things:

— reduced funding by about $160,000 for the remainder of 2020 and by $400,000 (nearly a third of its budget) in 2021 and 2022.

— ordered an annual schedule of remuneration and expenses for all employees earning more than $75,000 per year.

— specified that CVEDS follow Canadian accounting standards, maintain accurate records and permit CVRD inspection.

— required that the five elected officials assigned to the CVEDS board be given a full vote in all board matters.

— imposed mandatory performance reviews of all staff and the executive director.

— created a liaison team to investigate possible structural changes, integration of operations and generally review all aspects of the CVEDS’ function.

Since the contract renewal, destination marketing officer Lara Greasley left for a post at the Town of Comox. And CVEDS has laid off three employees of the Visitors Centre.

The CVEDS staff has also closed their offices above the Comox Valley Art Gallery on Duncan Avenue and moved them into the Visitors Centre near the Island Highway.

 

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Tensions rise as Liaison Committee explores integration for CVRD, CVEDS

Neither private or public, Economic Development Society provides limited financial information

by | Oct 1, 2019

Farm Cycle Tour display at the Visitors Center  /  George Le Masurier

Neither private or public, Economic Development Society provides limited financial information

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Third in a series of articles examining the Comox Valley Economic Development Society

If a citizen wants to know the salaries or travel expenses of their elected officials or local public employees, or how much their municipality spent on new streetlights, that data is readily available. If not, the public can obtain any financial data through a Freedom of Information request.

Private individuals and organizations, on the other hand, have no obligation to talk about their finances in public. And the Freedom of Information Act doesn’t apply to them.

The Comox Valley Economic Development Society exists somewhere in the grey area between these organizational models. It is neither a private or public organization.

CVEDS is a so-called arms-length entity. It delivers a service that CVRD directors two decades ago determined did not easily fit into the traditional administrative government model. It takes public funding, but acts independently.

And the limited financial information that the society releases publicly has long been a frustration for both citizens and elected officials.

CVEDS does not follow the standard financial reporting model used by all public institutions. They have created their own reporting format that does not break down the individual cost of its various initiatives or the wages and benefits of individual employees earning more than $75,000, a requirement of public reporting since the early 2000s.

Despite requests for more detailed financial information the CVEDS board has declined to provide it. That has raised debate over whether the public should expect that the finances of groups and organizations funded largely, but not exclusively, by taxpayer’s money be open for public scrutiny. 

A 2014 performance review of the organization by Urbanic Consultants observed, “While CVEDS has been providing audited financial statements annually per the Service Delivery Agreement, the statements do not necessarily give an account of how taxpayer money is being put to use.”

And, the consultants added, “the unique political landscape of Comox Valley warrants an effort to earn, build and maintain social license within the community.”

 

Sources of CVEDS income

The society holds a contract with the Comox Valley Regional District and received more than $1.2 million from local taxpayers in 2018 and another $290,000 from provincial and federal governments, according to its most recent unaudited financial statements.

Complicating the issue of financial transparency, the society also received the Municipal and Regional District Tax, better known as the hotel tax. Those funds come from private businesses — primarily hotels — that have agreed to add a two percent surtax onto their room rates to promote overnight tourism for the Comox Valley.

Visitors Centre on a weekday

CVEDS other income comes from advertising and ticket sales, retail commissions and bookings and earned interest, which are not technically public funds, although they wouldn’t be possible without taxpayers’ money propping up the society.

From the 2018 unaudited statement of financial position obtained by Decafnation, the Economic Development Society received $1,202,310 from local taxpayers as of Dec. 31, 2018 and another $1,003,522 from other public and private sources. With amortization of deferred capital contributions, last year’s total revenue came to $2,272,618.

Those other sources of revenue included the hotel tax ($320,781) and funding from the provincial government and agencies ($289,976). Other income amounted to $460,051, and the deferred capital contributions added $66,786.

CVEDS spent all but $76,742 of that income.

The society’s financials also show capital assets of $4,989,058, which is the assessed value of the Visitor’s Centre property and the building.

 

How CVEDS spends it

Wages and initiatives are the society’s two largest expenses.

In 2018, wages and benefits at $704,473 were the second biggest expense, accounting for about 58 percent of $1,213,605 total general expenses, not counting the cost of initiatives and contract services that CVEDS breaks out separately. Wages and benefits were about 32 percent of all expenses ($2,195,876).

There is no breakdown of how wages were split between CVEDS’ five full-time employees and roughly 4 FTE at the Visitors Centre, although some public officials have unsuccessfully requested information about individual compensation.

According to Schedule 6 of the financial statements, which shows income and expense by its three main focus areas — economic development, the Visitors Centre and destination marketing — wages and benefits are almost evenly split between economic development ($276,955) and the Visitors Centre ($282,388).

But only $145,129 in wages were attributed to destination marketing, which is the source of the largest share of CVEDS revenue, coming from the hotel tax, provincial grants, the CVRD and event revenue from the BC Seafood Festival and Expo. 

An analysis of the wage break down indicates that CVEDS staff spent nearly as much time managing the Visitors Centre as it did on economic development, and nearly twice as much time as they spent on destination marketing. That has raised some questions considering that the festival is the society’s single largest event.

Decafnation asked Board Chair Deana Simpkin and Executive Director John Watson on Sept. 23 to explain the distribution of wages among the society’s activities. Neither have responded.

 

Cost of initiatives

CVEDS spent $982,271 on initiatives and contract services in 2018. It was the single largest expense item.

But the financial statements provide no further details. The line item is not broken down to explain how much was spent on individual initiatives or even similar types of initiatives.

However, from an analysis of the individual MRDT and destination marketing operating statements, included in the overall financials, it appears that about half of the amount spent on initiatives, $464,978, represents the cost of staging the BC Seafood Festival.

Watson would not confirm or deny that estimated cost, but did say the festival is the society’s single largest initiative.

“(The Seafood Festival) is the largest single event and is steadily growing each year. Starting from a single evening it has now grown to 10 days of various activities and many, many partners,” Watson told Decafnation.

Lara Greasly, CVEDS’s marketing and communications manager said the “Festival/Expo Income and Expense … is the largest event supported by the Destination Marketing program.”

Greasly said tickets and related sales make up approximately 43 percent of revenue for the Signature Weekend and Expo. Sponsorship and related contributions comprise the other 57 percent.

On the expense side, 38 percent of total expenses were spent on marketing the event. Other expenses include the Seafood Expo – 12 percent, rentals/site – 20 percent, food and beverage – 12 percent, entertainment and competition – 5 percent and production — 13 percent.

 

Guarding CVEDS financial data

Getting CVEDS financial information can be difficult.

Even the Comox Valley Regional District is unclear whether it should share CVEDS’ financial statements. When Decafnation asked for a copy of the 2018 statements, the CVRD initially said it would provide them, and then later changed its mind and refused.

The audited statements were available, however, at the society’s annual general meeting in May.

The availability and depth of CVEDS financial reporting partly results from the nature of its unique contract with the CVRD.

Private contractors with local governments have no obligation to provide any public information. But they bid on competitive contracts.

Because the CVRD created the Economic Development Society through a bylaw, its contract is regarded differently. There is no Request for Proposal issued and no other individual or organization can bid on the contract. And the regional district is the society’s only contract.

According to some, that makes CVEDS immune from divulging further financial information.

So the question arises: Can taxpayers and elected officials reasonably assess whether CVEDS provides an acceptable return on investment with the limited financial information available to facilitate public understanding?

 

Return on investment

In the 2014 CVEDS performance review, Urbanics Consultants notes that the results of economic development activities are “notoriously difficult” to quantify. But the consultants recommended that CVEDS start tracking their work for its direct monetary impact versus resources expended.

“We feel that there will always be a certain level of scepticism surrounding the value of CVEDS activities unless it can produce the metrics that taxpayers want (e.g. jobs added, tax revenues increased, etc.),” the consultants wrote.

That recommendation has not been addressed says CVEDS Director and Vice Chair Bruce Turner because economic development is a complex activity. He says there are no metrics that could measure the results of some initiatives.

Besides, Turner says, only about one half of one percent of annual Comox Valley tax revenue is allocated to CVEDS.

“We’re not spending a lot of money on economic development,” he said.

But figuring out how that money is spent concerns Area B Director Arzeena Hamir.

“One of the frustrating things for me as an elected official is tracking where tax dollars are spent,” she told Decafnation. “The CVRD provides a certain amount for destination marketing and a certain amount for economic development. With the way the financial statements are currently presented, I have a hard time tracking if citizens are getting value for their tax dollars. Where where those ED dollars spent and what was the impact? I have a hard time getting those questions answered.”

Hamir says if individual industries can’t say that CVEDS activity helped move the dial, “then what are we doing with our tax dollars?”

Turner says every CVEDS activity has a KPI — key performance indicator — attached to it, and they are listed in the strategic plan as expected results.

But when asked for the KPIs for the BC Seafood Festival and Expo, Turner referred Decafnation to CVEDS Business Development Officer Geoff Crawford who provided a link to a document showing photos and statistics from the most recent event. 

Turner says these KPI statistics, such as number of tickets sold, are “output” measures, which he distinguishes from “outcomes.”

“Outcomes are those longer term results beyond the control of CVEDS alone,” he told Decafnation. “While CVEDS can contribute to their achievement, outcomes require the collaboration of all the primary stakeholders in the Comox Valley … and the province.”

Turner said investments in economic development compares to a municipality investing in infrastructure, “it’s not so easy to measure.”

“How do we measure the value or benefit of the information provided by CVEDS that helps small businesses make better business decisions to remain competitive?” he said. “How do we measure the contribution to well-being and wealth preservation and growth that economic development contributes to all community members. For example, would our homes retain their value with economic decline?”

But Area A Director Daniel Arbour asks that question in a different way.

“If there was no BC Seafood Festival, would the Baynes Sound shellfish industry collapse?” he told Decafnation. “There should be measurable outcomes.”

CVEDS Board Chair Deana Simpkin takes a more practical approach.

Simpkin measures the success of events like the seafood festival by the increase in traffic through her downtown Courtenay restaurant, High Tide Public House.

 

Next: How different sectors of the Comox Valley view CVEDS and has the society rebuilt relationships with complimentary local organizations.

 

 

 

 

 

 

 

SOME RELATED LINKS

Comox Valley Economic Development Society

2014 Economic Development Service Delivery Review

CVRD contract with CVEDS

CVRD Economic Development Service Establishment Bylaw

CVEDS 2018 Annual Report

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A shifting political climate means change for 32-year-old society, but board still divided

Comox Valley regional directors will decide fate of Economic Development Society

by | Sep 18, 2019

Exterior of the Visitors Centre managed by the Comox Valley Economic Development Society  /  George Le Masurier

Comox Valley regional directors will decide fate of Economic Development Society

By

The first in a series about the Comox Valley Economic Development Society

Sometime early next year, the Comox Valley Regional District board will decide whether to renew its five-year, $1.2 million annual contract with the Comox Valley Economic Development Society.

As part of its decision-making process, the board will review an independent report on whether the society has fulfilled the current contract signed in 2015. It will also review and either approve or disapprove of the society’s latest five-year strategic plan.

The nonprofit society, commonly known as CVEDS, has strong supporters and outspoken critics across many sectors of the community for both the value of its work and for the arms-length organizational model under which it operates.

Depending on your point of view, that model either frees economic development from political interference and has stood the test of time or it lacks financial oversight, public accountability and transparency. CVEDS either does great work or it creates events simply to get funding with little concern for their outcomes. It has either built valuable partnerships or it has burned too many bridges within the community.

And although the regional district’s original agreement with CVEDS was for the provision of economic development services, it now specifies that nearly two-thirds of local taxpayer funding ($750,126 in 2019) be directed toward operation of a Visitor’s Centre and destination marketing activities.

That has raised concern among some about how much economic development work CVEDS actually does or whether it primarily produces and promotes tourism events.

And that, in turn, opens debate about how promotion of lower-paying tourism jobs raises the level of a community’s economic health and sustainability.

To help the regional directors make their decision, a Vancouver consulting group, Explore Solutions, is currently doing a review of whether CVEDS has met its contractual obligations. 

But there are issues beyond the terms of its contract with the CVRD, which expires next year on March 31. Directors also have the difficult and perhaps political task of determining whether their constituents have — or, perceive to have — received sufficient value for their million-plus tax investment.

That evaluation is not within the scope of the current contract performance review.

But it was addressed in a similar independent review commissioned by the CVRD in 2014. 

“It is not so much that CVEDS is not meeting its contractual requirements … it might not be meeting them in a way that is entirely satisfactory to significant segments of the community,” wrote Urbanics Consultants in 2014.

CVEDS Executive Director John Watson acknowledges that issue.

John Watson

“We won’t do everything for everybody,” he told Decafnation recently. “The board decides our strategic vision and local governments approve it. Not everyone will be happy with the decisions of government.”

So it will depend on nine regional directors from Courtenay, Comox and the three electoral areas to decide whether the Economic Development Society has done enough for the sustainable economic prosperity of the Comox Valley to warrant a new contract. Cumberland has opted out of CVEDS funding and has no vote

And it is these regional directors who must conclude whether the CVEDS board has provided an acceptable level of oversight and public accountability to earn not just local tax dollars, but also the public’s trust.

The directors have many options open to them. They could ask for structural changes in the society. They could decide to take the service in-house as most surrounding municipalities have done. And they could debate whether a different organizational model would better serve the separate needs of economic development and tourism.

Whatever it decides, the regional board’s course of action seems almost certain to be controversial.

Directors’ views differ

The Economic Development Society is funded by taxpayers in Courtenay, Comox and the three rural electoral areas, and managed by a board of 11-voting directors plus non-voting representatives from each participating electoral area or municipality. Its contract with the regional district is to provide economic development services, destination marketing for tourism and management of the regional Visitors Centre.

The Village of Cumberland withdrew from participation in CVEDS services in 2016 because it saw little return on their investment.

All candidates running for office in the village’s 2014 municipal election supported withdrawing from the regional service. There was consensus among the candidates that CVEDS had done nothing to help develop the village’s industrial lands, despite the fact that Cumberland has the most industrial-zoned property available in the Comox Valley.

“Cumberland hadn’t been happy for a long time,” Village Mayor Leslie Baird told Decafnation. “We weren’t being recognized, and looking at the money we paid in per capita, we understood there was better value going on our own.”

Baird also saw CVEDS as evolving into an event production company, which she doesn’t believe has value for economic development. And, she said, the society’s destination marketing activities mainly promote hotels, which Cumberland doesn’t have.

Area A Director Daniel Arbour agrees on that point.

“The destination marketing function is focused on Courtenay and Comox. It has no value for rural areas or the shellfish industry,” he told Decafnation. “But it seems to be the biggest aspect of their (CVEDS) work.”

Mac’s Oysters, one of the shellfish businesses operating in Baynes Sound

Arbour, a Hornby Island resident with a background in economic development, said his area’s workforce is powered by shellfish, forestry, retirement and commuters.

He thinks the BC Seafood Festival, which is CVEDS’s single largest initiative held in June, possibly generates tourism in the shoulder season. But, he said, “the tactic is not the goal.”

“A measurable end goal is whether there’s an increase in licenses in Baynes Sound. The goal is to increase GDP and maintain the viability of the industry,” he said. “The shellfish industry is not growing. Growth in Area A will come from the developments in Union Bay.”

Asked whether he considers the current CVEDS arms-length organizational model as the best for delivering economic development services, Arbour said every model will have its pros and cons.

“But they all should have measurable outcomes determined by community engagement,” he said. “It would be better if the CVRD and CVEDS worked together on a strategic plan.”

The current process is for the CVEDS board and staff to create a strategic plan and present it to the CVRD board for approval or disapproval.

After the 2014 performance review of CVEDS, Area C Director Edwin Grieve said, “We need to see improved transparency, public consultation and communication.”

He thinks those corrections have been made.

“Historic oversight concerns from 10 years ago may have been the result of lack of interest or engagement by CVEDS members,” he told Decafnation. “It is proven that leaving any staff without clear direction, they usually develop their own.”

Grieve said, to misquote John Lennon, “The community you take is equal to the community you make.”

Grieve says the advantage of the current arms-length model allows the Economic Development Society to take full advantage of grant funding opportunities that are unavailable to municipalities and regional districts.

“It currently leverages about a dollar for every dollar,” he said. “It also helps that this separation (from politics) insulates the body from the temptation to constantly change directions due to political interference.”

Area B Director Arzeena Hamir is an organic farmer and owner of Amara Farms in Merville who got into agriculture to do economic development overseas, which she did in Thailand, India and Bangladesh.

She supports a grassroots approach to economic development that involves finding out the needs of local businesses and addressing them. But she says CVEDS doesn’t always do it that way. And she references a $35,000 Request for Proposal to develop a strategic plan that included robotics, genomics and artificial intelligence in agriculture.

“What farmer in the Comox Valley said they needed that?” she told Decafnation. “Not surprisingly, the consultant who filled that contract spent very little time on robotics, genomics or AI.”

Hamir also thinks CVEDS has become an event management company. And she wonders if that focus can create the economic outcomes the Comox Valley expects?

For example, she points to the annual Farm Cycle Tour as an example of a CVEDS initiative that doesn’t translate into large economic benefits for farmers.

“I myself, and the farmers I’ve spoken to, do not benefit long-term from the Cycle Farm Tour. It’s an education and outreach day. Our customers are not out-of-town tourists. It takes a full day away from farming to give away samples, but make few sales. We lose money,” she told Decafnation.

If CVEDS really wanted to develop the agriculture economy, she says they would bring around chefs or food buyers who might become regular volume buyers. Or, she says they could start buying local food for the Seafood Festival.

“Is it our own seafood that makes the Comox Valley special? Otherwise, you could do it anywhere,” she said. “Highlighting local food at the Seafood Festival would be a form of economic development.”

Paul Ives, the former Comox mayor and a long-time director on the CVEDS board,
told Decafnation that at one time CVEDS was doing nothing for the Town of Comox.

“Then I got involved and together we created the marina improvements, and now the development of the airport lands,” he said. “It’s incumbent on elected officials to participate and see what they can achieve.”

Ives also credits CVEDS, and Watson in particular, with pulling the recent Comox Mall renovation together. There was a point when the town and the new owners weren’t on the same page, and Watson stepped in to work out the differences, according to Ives.

Ives says the arms-length society model has worked and “stood the test of time.”

Courtenay City Councillor Melanie McCollum isn’t convinced.

“Economic development and destination marketing delivered as regional services is a good approach for our community – however, I’m not convinced that having these two things delivered under one contract is the best model,” she told Decafnation. “CVEDS has very limited staff capacity, and is providing a lot of event planning, which is destination marketing, but the work being done on economic development is less obvious and not as well communicated to the public.”

McCollum, who is Courtenay’s delegate to the CVEDS board, hears from people who would like to see more emphasis on supporting industry sectors that provide higher paying jobs, such as technology and education.

Next: The history of the Comox Valley Economic Development Society and what they do today

 

 

 

 

 

 

 

 

THE CVEDS CONTRACT RENEWAL PROCESS

The five-year agreement with CVEDS differs from other CVRD contracts for services. Because the regional district created the nonprofit society through Bylaw 345, the agreement for economic development services is not open to competitive bids. There is no Request for Proposal issued and the CVRD does not consider proposals from any other individuals or companies.

On June 1, the CVRD provided a letter to CVEDS that it would enter into negotiations for a potential five-year renewal of the contract after it receives the society’s new strategic plan on Oct. 31 and following an independent contract performance review due by Dec. 31.

However, the letter did not commit the CVRD to a new agreement, according to Scott Smith, the regional district’s general manager of planning and development services branch.

But Smith also confirmed that the CVRD has no Plan B. There is no parallel process underway to investigate alternate models of providing economic development services should negotiations with CVEDS not result in a renewed contract.

 

 

 

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