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Searchmont purchase, other recent EDC moves, prompt mayor's call for probe

"As much as we have talked about economic diversification — we haven’t achieved it”
20141201 Chain of Office Detail Mayor Christian Provenzano KA
FILE PHOTO: Detail of Chain of Office as worn by Mayor Christian Provenzano. Kenneth Armstrong/SooToday

Concerned about the amount of time the Sault Ste. Marie Economic Development Corporation spent on the passenger rail file, and wanting to examine the purchase of Searchmont Resort, Mayor Christian Provenzano wants city staff to take a closer look at the city’s economic development activities.

“We have our largest employer in distress and it’s a critical situation for the city. As much as we have talked about economic diversification — we haven’t achieved it,” said Provenzano by phone today.

An assessment of the EDC was last conducted in 2008, but Provenzano said this new motion will be broader, and include the Sault Ste. Marie Innovation Centre (IC) and Economic Development Fund (EDF) and ask if the almost $2.5-million the city uses to fund those agencies is being put to good use.

Provenzano wonders if there are better ways to leverage the city's money in a better way.

“The EDC has an incubator and the Innovation Centre has an incubator. Are those the kinds of things we should be doing? Is that an effective way to approach economic development? Should there be one incubator? I don’t pretend to know the answers to those questions — which is why I am asking them,” said Provenzano.

Provenzano also cites the EDC's January 2015 purchase of Searchmont Resort for $700,000 — along with an additional $700,000 in unpaid bills — as a reason he was considering the relationship between the City and EDC.

“That happened independent of city council. But that is the city’s economic development agency. When you see your economic development agency buying an asset that big, without requiring the consent of the city itself — it leads to examining what our policy direction is and whether we are employing our resources as effectively as possible,” said Provenzano.

He said he was concerned about the amount of time spent by EDC staff on the effort to save the ACR passenger rail service.

The EDC, IC and EDF collectively represent the majority of the city’s investment in economic development.

The EDC is given $1.7-million per year by the city, in addition to the $277,890 and $500,000 the IC and EDF receive, respectively.

CAO Albert Horsman would be directed to undertake the assessment directly or with third-party assistance and report the findings back to council.

The motion will be presented at the March 7 city council meeting.

In other EDC news, Nevin Buconjic was recently hired as manager of trade, investment and community marketing and Ward 2 councillor Susan Myers has expressed her wish to vacate her position on the EDC board of directors. 

Kenneth Armstrong

About the Author: Kenneth Armstrong

Kenneth Armstrong is a news reporter and photojournalist who regularly covers municipal government, business and politics and photographs events, sports and features.
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