Business Improvement Areas are agencies of the city (in this article, the City of Toronto). They are advertised as a community of businesses which assembles to protect their interests and promote prosperity. In Toronto, these BIAs come under the influence of the “BIA Office”.
The Toronto Office of Economic Development and Culture (OED) often referred to as the “BIA Office,” employs staff which is supposed to help Toronto’s BIAs. This staff is liaising with all the BIAs, attending BIA meetings and usually participating in the dialogue. And due to the exposure of their profession with many BIAs over the years, this staff is far more advanced in BIA governance than any given BIA Board. Accordingly, the staff is in a position to help, guide and advise their respective Boards with BIA operations.
However, this greater expertise also enables OED staff to become manipulative. Their operative priority is to advance the interests of their political masters (Toronto City Council). The BIA is guided as a vessel for promoting city projects. This betrays the ideal that was projected when a BIA was formed – that the BIA was created to protect and advance the interests of the business community, its members.
‘Using half-truths to mislead the business owners.’
This deception is intentional. No business owner would join or form a BIA if he/she was informed up front that they would pay an extra levy of taxation and those funds would be spent on city infrastructure. They are deceived into believing that the new BIA will ‘improve and prosper’ their business community.
The OED‘s priorities are to promote projects whereby the local BIAs take on “economic development” by purchasing or contracting projects. The OED promotes projects by manipulating the naïve and inexperienced BIA Boards into undertaking funding initiatives that serve OED priorities – such as “increased economic development”. These ‘developments’ are oriented to improving the city’s roads, sidewalks and other assets (which, otherwise would have to be developed by the city, at city expense funded from general revenues.) That’s where the extra tax base really benefits the politicians. At all times, the naïvety of the Board members is exploited by convincing the Board that these projects will benefit the BIA with added prosperity and enhanced business activity.
Let’s pause to illustrate some details on how these projects proceed.
The BIA is encouraged by the OED to undertake a streetscape project. The offer is conditional to the OED approving and managing the project. Once approved, the cost is shared (usually 50-50) by the BIA and the City. An agreement (First Contract) is drawn up between the OED and the BIA whereby the OED selects the contractor (with whom it engages in a separate ‘second’ contract for the work to be done) and OED staff manages the project exclusively (no veto by the BIA). In the event of cost overruns (always), the BIA is on the hook and cannot refuse payment. If the BIA refuses to pay any additional costs, the First Contract enables the OED to unilaterally take the funds without BIA consent. This means that, if OED staff are negligent or incompetent and fail to manage the project with diligence, all wasteful costs and excessive charges by the contractor become the BIA’s burden.
But these critical details are not revealed to the BIA members when the projects are being promoted. They find out the hard way – after matters implode and the piper must be paid!
Again, we see where deception is part of the modus operandi. Unless the naïve or inexperienced Board members know what questions to ask, they’re taken for a ride. Even when the right questions are asked, OED staff intentionally provides vague information and misleading reassurances.
Some of these initiatives, such as installing street banners or flowers in planters, create expenses that are of questionable benefit to the BIA. Flowers, banners and ‘gateway’ projects are trumped up as ‘branding the BIA’ and improving business for its members. An illustration of how wasteful this can be is obvious when one drives along the Danforth, where five BIAs exist side-by-side, or along Bloor, where six are found .
Anyone driving along these streets cannot really distinguish where one ‘branded’ BIA leaves off and when the next one begins… they all show banners and flowers.
This spending of tax dollars means that by year’s end the OED can claim an increased “success” in economic development for the city – which results in a greater political power base for the OED.
These uninspired initiatives are repeatedly promoted by the OED to every BIA, usually wasting tax money and doing little if anything, to improve BIA prosperity. Such projects are promoted with the myth that flowers in the neighbourhood will increase business traffic and profits. However, they visually improve the environment, which serves the interests of City Council by beautifying the Public Realm and relieving council from having to shoulder this financial burden. This is not to say that such improvements to the neighbourhood are not positive. But to argue that people will shop in an area because there are flowers on the street is asinine. Shoppers will go for groceries where it’s cheaper or most convenient or bank where their branch is located. They do not pick their car repair mechanic based on whether there are flowers outside the garage…
Nonetheless, these policies and city priorities are dressed up as ‘good business initiatives’ and engaging such projects makes the OED look good and their staff ‘productive’.
Their “true” productivity is best revealed by researching OED contracts. They are almost all over budget and over-priced because the OED restricts the bidding to a small number of acceptable bidders (who are aware their competition is very limited). It follows a formula which is questionable at best and outright stupid at worst. It promotes economic projects with the BIAs which it justifies as generating prosperity, enhancing the environment and traffic flow.
It’s all smoke and mirrors. The result of these projects is to expend money paid by a few selected sources (the BIA members) for improvements to the Public Realm which should be properly funded by the greater whole; all taxpayers in the city.
Continued, Part IV