Economic Development Spending

Owen Sound continues to waste valuable resources on development in spite the fact that these resources have not produced any measurable results in 20 years. All municipalities invest in Economic Development in hopes of increasing their tax base and increasing their population. Table 11, below provides some insight into the annual cost of Owen Sound’s investment in Economic Development. As you can see Owen Sound has spent almost $12 million over the past ten years aimed at stimulating economic development. This was NOT the best use of these tax dollars given that the city population and tax base did not change during this period.

Table 11; Historical Spending on Economic Development Source: Owen Sound Audited Financial Statements

Owen Sound hasn’t grown in 30 years and in spite of the Mayor’s efforts over the last 12 years it hasn’t happened yet. Hence there is a built up thirst for Owen Sound to grow; which in turn encourages continued investment in economic development. This has created a false optimism that growth is just around the corner. I recall the Mayor saying many times over the last ten years or so that: “we just need to grow the tax base” He’s right! We would all like new industry to relocate to Owen Sound and bring with it a host of new residents to support our local business. However, based on the past 30 years, it is just unrealistic to continue to believe each budget year this is the year that growth is going to happen. The reality is that Owen Sound is not on the threshold of growth.

It’s time to face reality – it’s not going to happen. So stop Investing in Growth! We wasted $12 million that could have been used to address other worthy causes. We need to reallocate these resources toward more realizable goals.

Based on past results I predict the only growth we are going to see when the next census is published in 2026 is a modest increase in population in the range of 1 to 2 percent which will bring Owen Sound’s population to about 22,000. This growth will be independent of Owen Sound’s spending on economic development efforts. A preponderance of this growth will be due to seniors relocating here from the GTA to take advantage of the relatively lower property values and the quieter, safer, environment that Owen Sound has to offer retirees. We only need to look at the price of new homes in Owen Sound which are priced at over a million dollars. With a median after tax household income in Owen Sound of only $57,600, very few locals can afford these homes yet there is a steady sale of these million dollar homes.

It’s important to note that although all municipalities invest in Economic Development, Owen Sound is the only municipality in the study group spending over a million dollars annually on economic development. Owen Sound is also the only municipality in the study group whose population has not grown in over 30 years. Perhaps it’s time to rethink this expenditure.