Barrie’s real estate market red hot
Home sales in Barrie were up 29% in April of 2012 over April of 2011. Some interesting details on what is driving demand in this article:
Anne Street South
Anyone noticed how Anne Street South has turned around in recent years?
Anne Street South was Main Street of Barrie’s early post-war industrial area. Over the years, as newer industrial areas to the south started to attract more modern industries, and as Ontario manufacturing was hammered through the 1980s and 1990s, many of the larger plants actually on Anne Street started to close. Some of the anchor businesses are still there, such as Barrie Welding, a leading-edge shop producing everything from heavy equipment for mining to robots for auto plants. But several of the other industries closed, such as Risdon.
The condition of the industrial sector in the area was matched by the condition of the road. By the middle part of last decade, Anne Street was often on the CAA’s list of the top 10 worst roads in Ontario. A “Barrie Special” – varying from four lanes, to sort of three and a half lanes, Anne was pockmarked and past it’s shelf life.
After lengthy negotiations to buy the needed property strips on each side of Anne to make it a consistent width, it was finally rebuilt and reopened as a proper 4 /5 lane arterial road in 2010. It’s interesting to see what’s happened since. A number of new businesses have moved onto Anne – it is continuing to shift to being a commercial street rather than a purely industrial area.
The types of businesses that have moved into the area mirror changes in Barrie’s economy. An office building near Tiffin. A new big box outdoor living store. An expanded garage. The new Kawartha Dairy ice cream shop and store. Just off of Anne Street, there are three recycling businesses, including Habitat for Humanity’s expanded ReStore. But most encouragingly – Barrie Welding is expanding. Their new building is under construction right now. It is extremely encouraging to see industrial uses expanding in Barrie, particularly in older areas such as this one.
Big week for Barrie
Lots of news in the past week in Barrie.
First, the IBM announcement. It’s a great honour that IBM has chosen Barrie for a major new facility, and I was delighted last week to join representatives of the Provincial and Federal cabinets at the announcement of their new, $210M research project. While the numbers of jobs in Barrie will be only a portion of the overall 145 new jobs at IBM, the project in Barrie has already created more than 100 jobs in construction, and there will be many more created through the research projects that will happen in part at the Barrie data centre.
What is truly incredible about what IBM is doing is the nature of the research. It will be leading-edge modelling in neuroscience, smart cities, clean water, supported by IBM’s supercomputers. The computing power will allow research that hasn’t been possible before, in part through the power of cloud computing.
The next day, Minister Bob Chiarelli was in Barrie to meet with me about our priorities. Bob Chiarelli is the Minister of Infrastructure and Transportation, and as a former Mayor of Ottawa, understands what municipalities struggle with from day to day. He has promised help with the Duckworth interchange and was very supportive of our bid to bring a university campus in Barrie.
We also had three openhouses about the transit plan last week. Each was well attended and raised good concerns and questions. We won’t be implementing changes to our transit system until spring of 2013, so there is lots of time to make your voice heard. Details and an online survey are available here.
Monday’s meeting
My prediction for Monday night:
- Council will reconsider the fees for downtown patios
- We will have a lot of questions about the new parking strategy (I generally like what I’m seeing, with a few exceptions)
- The presentation about being a “Blue Community” will trigger a discussion about bottled water, and why the water out of your tap is almost always much higher quality that what you buy in a bottle
- One of the four elementary school students from Toastmasters will give the best speech of the night
The great debate – What costs should we share?
On Monday night Council had a good debate about the Barrie marina and cost-recovery. What that speaks to is a much broader question – who should pay for what services, and to what degree should we all pay for them through public funding (versus “fee for service”).
I made a speech about this and took the time to write down my thoughts because this is one of the central questions for government at all times, but particularly now. Here’s what I’ve prepared, it’s basically an extended version of what I had to say on Monday night.
There was an item for discussion at General Committee last week regarding a proposed auction of boat slips. “Items for discussion” are well named – they are essentially private member’s bills at the local level, and may or may not go ahead. This one has certainly generated a lot of discussion, most of it focussed on the idea of auctioning slips to determine market value.
I don’t support the idea to auction three marina slips. To be fair, the intent was to use an auction as a pilot project to determine market price for boat slips – but for an auction to truly reflect market value, it would need to be unconstrained. With hundreds of people on our waiting list for a slip, and only three slips for auction, the result would no doubt be a highly inflated price. It would not be any more reflective of market value than the current policy.
I also don’t really feel that “market value” should be the basis on which the City sets its fee levels. Market values are almost always inclusive of profit. The City is precluded by legislation from making a profit on providing services.
But I do support the intent of this motion. The intent is to move the marina closer to full cost recovery, where revenues offset the full costs of providing the facility.
We’re actually not far off that today. The marina generates an operating surplus every year, which is transferred to a reserve fund for marina improvements. The problem is that even with that fund, the capital replacement costs are not fully funded – for example, the breakwall that protects the Marina is not covered, nor is replacement of the marina building itself. At the very least, we need to assess these costs and make it clear how much of the marina’s costs are funded by operating revenues, and how much is funded or will be funded by the tax base.
This has raised a broader issue though of what services the City should provide, and whether we should provide these at a subsidized rate or a full market rate. Almost all city services are “subsidized”, to one extent or another. Streetlighting and police services are two examples of services that are 100% subsidized, in part because it’s not really practical to charge user fees for these services. Others, such as transit, garbage collection, and recreation programs are a blend of subsidy from the tax base and user fees – from fares, bag tags, and program fees, respectively.
Some of these services are also provided by the private sector. It has been said around this table that if it’s in the yellow pages, we shouldn’t do it. While I admire the clarity of that position, I don’t really agree with it.
There are some services that Barrie provides that are also provided by the private sector, but we choose to do this because there’s a broader benefit to more people using the service. But, we should only do this where there’s a very good reason. The principle is there must be a greater public benefit if we are going to provide a competing service.
Fitness facilities are one example. There are private gyms. We also provide gyms at rec centres. We do this so that there is a low-cost alternative that allows more people to keep fit. This makes sense because it helps us stay healthier as a society. And if were’ looking at the dollars only – the healthier we are as a society, the less our costs are elsewhere in the health care system. So arguably the money spent subsidizing fitness facilities saves taxpayer money spent on health care.
Transit is another example. Transit is part of providing transportation choice in almost any city around the world. We do it in part so that people who cannot drive can get to work, to medical appointments, and so forth without having to pay a much higher price for a taxi. We also do it to provide another transportation choice, one that has the considerable public benefit of keeping cars of the road and reducing pollution.
Council is tonight endorsing a plan for an overhauled transit system that will provide more people with more access, to jobs, to services such as the hospital and Georgian College, and help us get around more easily. It will bring in more fare revenue, but the costs will be more than the revenue, so this service will continue to need a subsidy.
So back to the Marina. What is the greater public benefit?
Is there an economic development benefit, a tourism benefit? Not really, our marina has only a few transient boat slips for tourists. No doubt if we had more, there would be more tourist boaters staying in Barrie, using our downtown shops, restaurants, and services – then there could be an argument for a broader public benefit. But that is not the case with the current marina model. Is there a public health benefit? Not really. There could be an argument that there’s an “accessibility” benefit – that people who can’t afford a private marina are able to afford our subsidized rates, so it allows more people to get into boating or sailing. That’s probably true, at least for a few, but I believe we’re in an era now where providing accessibility through subsidy of a service like this, absent any other benefit, may be a luxury we cannot afford.
So with the marina and other services, we do need to move to a system that is more directly based on user-pay. We ask our taxpayers for enough already out of the tax base. User pay is well established for services where we are trying to encourage conservation – such as garbage collection and water – but also because it is fundamentally more fair and transparent. This is why Council has made decisions related to garbage collection, recreation programs, and other services, to move to more of a user pay model. As mentioned, there are some non-essential services that we may not be able to afford subsidizing anymore.
But in making these decisions we should not forget our principles, and simply privatize anything that’s in the yellow pages. Because against the “user pay” principle needs to balanced the principles of access and public benefit. Providing lower cost access to fitness facilities and kids sports programs, for example, should continue, in my opinion, because there are broader public benefits.
I like the fact that Barrie has a marina. I don’t know how we could be “Ontario’s premier waterfront community” without one. I would even like to see it expanded, particularly so we can have more transient slips. Then we are creating a facility that has a broader public benefit.
Most of all, though, given the fiscal climate we are in, we need to have a open and frank discussion with our residents regarding what services we provide and at what level of subsidy. This needs to be a debate that has the benefit of good information about current and future costs, and extensive consultation with the people who use the services and those who pay for them.
A few things heading into the weekend
The agenda for Monday night’s council meeting is a big one – several major items on the agenda, not least is the Plan for Transit; also, proposals to create a Natural Heritage System in Barrie’s planning documents, a senior’s housing development near Little Lake, and approval of zoning limits of new bars in Downtown Barrie. Tune in. There’s a lot going on. Here’s a link to the agenda and staff reports, scroll down to Monday’s date: http://barrie.legistar.com/Calendar.aspx
Great meetings today on the potential for a university in Barrie, on new development and jobs at the Lake Simcoe Regional Airport, and with our MPP on skills training. Skills training gap is probably the biggest opportunity to immediately create jobs in Barrie – we have jobs in Barrie that can’t be filled by employers because there aren’t enough potential employees with the skill set needed.
And last – my band is playing at the Battle of the Bands tonight, a charity concert for the RVH. This is one of the ways I help to raise money for Barrie charities; it still amazes me that anyone would pay to listen to us…but at least it’s for a good cause!
Great story
Great article on the turnaround in Downtown Barrie:
http://goodlifebarrie.com/article/000053/A-transformation-is-taking-place…-Downtown-goes-Uptown
Nice to see stories like this, as the transformation continues…
Our Future Depends on Decisions Now
When my three year old daughter grows up, I want to leave her a Barrie that is stronger than today. That means a city with a stronger economy, and with governments able to afford the services she will depend on. And that future depends on good decisions today.
From Greece, to the USA, to here in Ontario, clear messages have been sent to governments who are living beyond their means: improve your finances, and have the guts to make tough decisions, or you face economic disaster.
In Barrie, Council heard this message – but we had heard it already, several years ago. Improving the city’s financial condition has been a key aspect of City budgets for the past four years. The city’s financial condition will need many more years of prudent decision making to push it onto a better course, but the good news is that through better long-term planning, careful cost control, and most of all, doing business differently, our financial health can be restored.
As one example, Barrie has in recent years incurred significant debt to fund major projects. Few cities avoid issuing at least some debt – Mississauga, one of the longest holdouts against debt, recently issued the first debt in its history. However, although a prudent amount of debt is reasonable and often necessary, limiting the amount of additional debt that will be required in coming years is now a critical step for Barrie.
Through the course of last year, two major steps were taken. First, by changing the timing and funding plan for the police facility, Council removed the need for about $20M in debt. Second, the 2011 and the 2012 budgets together reduced forecast debt by about $7M in total.
Controlling operating costs is crucial. In April, I asked Council to approve conducting service reviews of 6 city departments. These reviews were conducted in 2011 and have identified half a million dollars in savings in 2012, and up to $2M of annual, ongoing savings in 2013.
This year, Council had to make the very tough decision to close two under-used city facilities. These closures are painful and are a loss of services to those who use them, however few in number. I don’t like that they are closing and I hope we are able to use the next six months to find partners to continue to offer some of their services on site. But in times of restraint, tough decisions must be made.
Yet against these savings, we have also been told clearly by our residents that some services need improving, such as road maintenance and public transit. While cuts have been made to underused facilities and services, there are also new services being provided as the city grows — including additional road resurfacing work, and the foundation for improvements to Barrie Transit. No tax increase is acceptable without being able to clearly show what residents are getting for their money, but the tax increase this year has been targeted at the priorities residents told us are key.
Standard and Poors (S&P), the company now famous for downgrading America, also reviewed Barrie’s credit rating a few months ago, and reaffirmed our credit rating on the strength of our long-term financial plan. Sticking to this plan – by making sometimes tough, potentially unpopular budget decisions – should be the standard by which Barrie residents hold Council accountable.
Census Numbers
New census numbers out today show Barrie is growing slower than we were in the past.
At 5.9% growth in 5 years, the Barrie CMA is still the 5th fastest growing CMA in Ontario, but we are not growing anywhere near as quickly as we did in the past. This is good. Barrie grew so quickly in the late 90s and early part of the last decade that we could not keep up with the demand for growth – our shortage of family doctors, our traffic issues in the south end, our backlog of road repairs are all symptoms of growth that was just too fast.
I’ve often said that Barrie needs what I call “Goldilocks growth” – not too fast, not too slow – which to me is about 1.5% to 2.0% annually. That’s a pace of population growth that we can keep up with, where services can be provided for people as they come to Barrie. It also means more customers for Barrie businesses and a growing base of labour for our manufacturers and others to expand.
The story of Barrie since World War Two has been phenominal growth. We are probably entering a period of more modest growth, and that’s a very good thing – we need to grow slower and smarter than we have in the past.
Downtown – the Year in Review
Further to my last post – Christmas/New Year’s is a good time for a gut check – to look back and see what worked and what didn’t, and what needs to change for the new year.
Our recent citizen satisfaction survey noted that Downtown Barrie is one of the top issues facing our city. Looking at our Downtown, 2011 was a very good year. The Mady Theatre opened, and construction began on the first new commercial and residential development in the west end of downtown in more than thirty years – the Nautica development at 15 Maple Street.
But the most positive thing that happened was the number of storefronts that filled in Downtown during 2011. Here’s a list of the new businesses that came to Downtown in 2011 – thanks to Craig Stevens of the Downtown BIA for this list.
Beavertails
Bark & Meows
Deelish Waffles & Desserts
TLC Bistro
Absolutely Fabulous Fashion Finds
Rawlicious
Femme Fatale Spa Lounge
Bliss Studio
Donaleigh’s Pub
Spice
Red Tulip (returned to downtown)
Mitty’s Sports Bar & Grill
The Clarkson Pub
Wild Wing
The Edge Gallery
The Brentwood Salon (relocated and expanded)
Simply Tea & Chocolate
The Maple Avenue Towers
Mady Lakeview Sales Office
Mady Centre for the Performing Arts
The West Sales Office
Back To Basics Social Developments – Unity Market; opened on Toronto St.
Gown Gallery – new on 54 Dunlop Street West
In addition, many other businesses expanded or grew in new locations downtown. Looking ahead, while January will no doubt bring some additional vacancies (many companies are on a calender year lease, and if they are planning to close, January is usually the month), the strength of downtown will be in both its commercial and growing residential population. As several developments move forward in 2012, Council will be focussed on ensuring public areas continue to become safer, more attractive places to be. The Downtown BIA has done excellent work in 2011 in implementing the first steps in Roger Brooks’ recommendations for making downtown more of a people place, including temporary patios and new beautification initiatives. The trick will be to keep the momentum going in 2012, despite an uncertain economy. But a stronger Downtown means a stronger community as a whole.