Past NPA councillor Peter Ladner weighs in on the civic election in this piece for Seattle’s Crosscut – and adds comment on a lot of related issues.
Vancouver voters have spoken. Their message: we’re okay with Vision Vancouver Mayor Gregor Robertson and his “green city” team, and we’re ready for more of the same. …
The election was as much a statement about Vancouver’s confused electoral system as about the will of the 34 percent of electors who bothered to vote. It’s not a coincidence that, faced with an alphabetically listed ballot with 94 names on it, voters picked candidates with first initials A, B, and C for the three non-Vision seats on council. …
The other downside of Vancouver’s at-large system is that every candidate has to win votes citywide, which makes incumbent name recognition a huge asset and dictates that expensive citywide party campaigns are the only way to get elected. No independent has been elected in Vancouver for decades….
Now that Vision is back, the big issues will once again displace the sloganeering. Robertson continues to promise more affordable housing, but cannot do it without provincial money…
The one tool the city has to raise money for affordable housing is selling new density, but that runs up against the significant constituency of density deniers … but accommodating growth and increasing housing supply, even along transit corridors, is always a battle in Vancouver. Build it, and outside investors will come, keeping affordability for working families well out of reach. …
The financial fiasco surrounding the Olympic Village on False Creek is still weighing heavily on the accounts of the Property Endowment Fund. It’s a city-backed development corporation with enough assets to withstand Vision’s missed opportunities to put the Olympic Village in a stronger financial position ….
Possibly the biggest challenge facing the new council is the steady economic erosion of Vancouver, famously described by a former president of Simon Fraser University as a city with no visible means of support. …
Lots of fun stuff for comment.
Shame he repeats that “46 new business licenses last year” statistic – which is utterly false. There were 46 *net* new between 2001 & 2010, but that’s because so many businesses were lost between 2001 & 2007. In fact there were over 4000 net new business licenses issued in Vancouver between 2007 & 2010.
Mark – on Crosscut you credit the business tax shift as being a turning point. I’m not sure about that, but it’s a reasonable hypothesis. But there’s this:
Businesses are giving up on finding employees who can afford to live in the third most unaffordable real estate market in the world.
Businesses don’t seem to be passing along tax savings to workers in higher wages that would allow them to live, or at least think about living, in the CoV.
As an example, I’m pretty sure a Starbucks barrista in Vancouver gets the same wage as one with similar experience in Surrey.
Similarly, the savings don’t seem to be passed along to the consumer. Sticking with the Starbucks example – a cup of Starbucks coffee costs the same across the Lower Mainland.
If the turning point were something else, I’d love to know what it was. It’s not like you can point to a general boom in the economy for the period 2007-2010, is it?
As Mezzanine says, the point of the tax shift was not to address affordability, it was to address businesses & jobs leaving the city – and the numbers certainly suggest that was a problem & things may still be less than ideal.
I don’t think anyone in their right mind would make the claim that businesses would pass increased margins from tax cuts on to their employees. But not every business has the same kinds of margins Starbucks does, and a business has to have some profit margin in order to operate at all. So while allowing Starbucks to increase their margins seems a little unpalatable, it’s perhaps preferable to a situation where the only businesses that can operate in Vancouver have to be Starbucks or something similar and we approach a Coffee Event Horizon (with apologies to Douglas Adams.)
As Mezzanine says, the point of the tax shift was not to address affordability, it was to address businesses & jobs leaving the city
This is getting far away from the thrust of Ladner’s article, but that wasn’t the stated rationale of the shift either. The 2007 City of Vancouver Property Tax Policy Review Commission Final Report states the purpose was to address “perceived inequity”.
It also found (pg. 42) that commercial investment started picking up in 2004, and that Vancouver had the highest level of commericial investment in the Lower Mainland between 1998-2006. I’ll concede commercial investment isn’t the same as business starts (Not that I doubt you, Mark, but I’d love to see the stats on that).
Starbucks was just the example that came first to mind. To me the primary cost for this level of business would be rent, rather than taxation (as the report mentions). Vancouver’s rents are higher.
Anyway, I find the report a rather remarkable document. They basically can’t come up with a rationale and settle on “perceived inequity”. To this observer the shift doesn’t do much for businesses, but does add to the cost of living here.
I’m not sure the starbucks example is valid. IMO if you are an entry-level starbucks worker, passing on any savings from the civic business tax cuts to staff would be futile in trying to improve housing affordability.
It might make a larger marginal difference if you own, or arre thinking of establishing a business, though.
Regardless, I would agree with Mr. Ladner’s sentiment in his article about the precariousness of vancouver’s economic health, although a lot of factors influencing it are out of the control of civic hands.
That’s sort of my point – we’re not seeing higher wages (or lower consumer prices), and won’t see them. It’s probably unfair to single out the business tax shift for failing to address Vancouver’s lack of affordability, but conversely I’m also not sure what the business tax shift is supposed to do, really. Which I wrote about here.
Ultimately it just adds to the cost of living here.
I can agree with the idea that reducing business taxes have little to do with individual affordability, but i don’t think the policy had that in mind.
IMO it definately improves the ability for new business to set up within vancouver, going back to Mr ladner’s point of making sure we have a vibrant economy.
I don’t think that comparing Starbucks wages and prices across Metro Vancouver is useful because they all pretty much serve a common pool of potential employees. Better to compare those in Metro Vancouver with those in other cities such as Victoria, Kelowna, Winnipeg, etc.