Macdonald: Asking the Why


CommonSense-FullCombo-03.pngIt seems as though we are having a geographical shift in the relocation of businesses from the downtown core of Calgary to the suburbs. The oil and gas industry is slashing operating costs, vacating office space and shedding once highly valued yet now unaffordable employees. One would think engineers and other skilled professionals are flocking to the "burbs," but are they really? 


Let me get this straight … we've had a downturn in Calgary's economy for the past two years which has resulted in property values dropping in the downtown core. This decrease in property value has created an unprecedented loss of tax revenue and a massive funding shortfall for City operations. 

One has to wonder if the taxation funding shortfall is due to the non-payment of taxes by failed businesses or if it is due to the exodus of businesses from the downtown core (to either the suburbs of Calgary or to nearby municipalities) because entrepreneurs are required to make decisions that will ensure the survival of their businesses. One such decision being to lessen the high costs of operating in the city centre. One might call this good business sense or simply, common sense. 

Many companies were established and continue to operate outside of the city core – it wasn’t necessary to locate downtown and it certainly wasn’t advantageous. Other companies once located in downtown Calgary realized the benefits to operating outside of the core and years ago, implemented a plan to boldly relocate to industrial and commercial suburban friendly subdivisions such as Quarry Park.

It's important to note that businesses in Calgary have thrived in the burbs and industrial subdivisions, adjusting to varying economic conditions over the course of many years. Today, we have a situation where there are many vacancies due to the unprecedented 'shuttering' of buildings and closing of once profitable businesses in the Foothills Industrial Park as in other areas of the city.

They will soon find out whether they were correct or not, finding themselves blindsided by a Council decision to chase any available options for recovering taxation shortfalls. All citizens should be watching to see if Council further punishes these businesses and private enterprises by increasing tax rates outside the core. Remember, Calgary Council and our civic leaders are not proposing any spending restraint. 

Our elected officials love to boast about the attributes of Calgary businesses and the people leading them, often describing them as innovative, resilient, world-class, risk takers, the best of the best, and so on. It is these business pioneers, the entrepreneurs and innovators that are in large part what makes Calgary great. On the one hand, our civic leaders promote this enterprising foundation as a reason to come to Calgary to establish and operate businesses, while on the other hand, at the first sign of trouble, is it the expectation of our civic leaders that these businesses foot the bill for the City’s audacious spending? 

Once upon a time, Calgary's slogan was "Heart of the New West" and that has recently been replaced with "Be Part of the Energy."  Business owners may very well be asking themselves where they will get the energy to persevere in this city of ours. 

Kathy Macdonald is executive director of the citizens’ advocacy group Common Sense Calgary

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