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RFD- 3012 Business Items   Item #   11. b.    
Regular Council Meeting Agenda
Meeting Date: 05/23/2017  
Title:    Edmonton Metropolitan Region Economic Development Initiative - Walker
Department: Economic & Business Development  
Strategic Vision Element: Where People Choose to Grow a Business - A strong, diversified regional business centre Related Goal: Spruce Grove has a business environment that encourages and supports new business start-ups, helps ensure existing businesses are competitive, successful and profitable, and attracts new businesses to the City.

Request for Decision Summary
Council approval is requested for the City of Spruce Grove to become part of the new Edmonton Metropolitan Region Economic Development Entity sponsored by the Capital Region Board.  The new Entity will be structured as  a Part 9 Company with a Board comprised of regional and business stakeholder representatives. 

Proposed Motion
That the City of Spruce Grove
(1) Subscribe for a share in the Part 9 Company to be incorporated for regional economic development in the Edmonton metropolitan region (the "Company");
(2) That the City agrees to a three year funding commitment to the Company not to exceed $45,000 in 2017, $60,000 in 2018 and $90,000 in 2019; and
(3) That the City, as required by the Articles of Association of the Company, appoints the Mayor of Spruce Grove to serve as the elected representative of the City and in the event that the Mayor is unable to attend any meeting of the shareholders, the Deputy Mayor of Spruce Grove is appointed to serve as the alternate elected representative.   

The economic development and marketing efforts within the Edmonton Metropolitan Region have historically been very fragmented.  Each of the 24 municipalities have pursued their own programs, activities and initiatives with very little coordination, notwithstanding periodic efforts to work together and otherwise collaborate.  Only Edmonton and to a limited extent the Industrial Heartland and the Leduc-Nisku EDA have the resources to undertake major marketing campaigns, participate in external trade shows and missions, and take advantage of provincial and federal programs to promote trade and investment attraction.  This has placed the Edmonton Metropolitan Region at a serious disadvantage in conveying a consistent message, creating an identity that could be marketed with national and international audiences, and combining resources to undertake an overall strategic plan built on the strengths of the entire region.  

At times, municipalities within the Edmonton region ended up competing against each other which created the appearance that we didn't have our act together.  On the other hand, our competitors have long ago recognized the need to create a single identity for their metropolitan areas to aggressively market what they have to offer and to create that one window which site selectors and investors expect.  Across Canada, metropolitan cities such as Greater Toronto, Ottawa, Vancouver and Calgary have developed identities and effective marketing programs that have broad recognition outside Canada.  The Edmonton Region, on the other hand, never managed until now to see the need to establish a single marketing entity and have one voice if we are to compete with other centers in Canada, the U.S. and the world.  

Recognizing the need for a more regional collaborative approach to economic development, the Capital Region Board (CRB) in March 2016 approved a motion directing CRB Administration to " incubate a formal regional economic development model, which would be independent of the CRB, for further development and that CRB Administration report back on progress in June 2016.  An interim Board was subsequently established and tasked with getting this new Regional Economic Development Entity off the ground.  The first meeting of the Interim Board was held in December 2016.  

The structure of the new Entity will be a Part 9 Company (not-for-profit) with a Board of Directors that have the power to manage the business and affairs of the Company except where otherwise limited by the Articles of Association. The Board shall consist of 8 to 12 Directors appointed by the Shareholders.  The term of appointment shall be a maximum of two terms of 3 years each and shall be staggered to ensure continuity.  There will be a Skills Matrix established to help identify the right individuals.  These people shall be broad thinkers representing a cross-section of business leaders; experts in governance, legal and finance; representatives from key industries; and people who value education and have government experience, which will be important relationships.    

The Board composition is further defined in the Articles of Association as consisting of: 

a). Five appointees who have business or professional experience aligned with the Skill Matrix AND personal or business residency in: 

     - One from the Leduc sub-region
     - One from the Strathcona sub-region
     - One from the Sturgeon sub-region
     - One from the Parkland sub-region
     - One from the City of Edmonton

b). Five appointees who have business or professional experience aligned with the Skill Matrix AND are industry leaders with subject matter expertise.  

The Outcomes set out for what the Edmonton Metropolitan Region Economic Development Entity is expected to accomplish in its first three years are as follows: 
1) Branding: A regional brand, supported by targeted and consistent messaging, along with a strategic brand marketing plan, to attract new investment to the Edmonton Metropolitan Region through increased exposure of the region.
Value Proposition: The Edmonton Metropolitan Region is identified internationally and recognized as a compelling location for investment. 
2) Database: A comprehensive, accurate, "investment-ready" regional database of the assets and attributes of the Edmonton Metropolitan Region.  The database will be updatable and accessible to allow municipal partners and regional businesses to share information, prospects and opportunities, including the development of a uniform regional site selection tool. 
Value Proposition: Global site selectors are able to find accurate information helping them to make informed decisions about the Edmonton Metropolitan Region. 

3) Regional Strategy: An economic development strategy, informed by existing data and research of regional partners, focused on strengthening the Region's global competitiveness to attract investment and talent, while supporting business retention, expansion and investment.  

Value Proposition: A strategy ensures the region is working together in a collaborative manner providing a consistent and compelling story that will target investment from key sectors and talent.  

Based on the outcomes defined for the Entity within the first year, the focus would be on completing the Environmental Scan now underway and hiring the Board and CEO.  In year two, work would begin on developing a Brand Strategy, an Engagement and Communications Strategy among stakeholders, and begin work on a sectoral analysis and a Site Selector Database.  In year three, the focus will be on completion and implementation of the Regional Economic Development Strategy.  The approach is to scale up the organization over the three years and to be fully operational at the end of three years.  

Membership is open to the 24 member municipalities of the Capital Region Board.  Based on the funding model, the Entity does not need all members to move forward.  The funding will scale up or down depending on who agrees to participate.  Confirmation of the initial slate of Shareholders will be important to be able to apply for matching funding from both provincial and federal programs.  The Shareholders, based on the Strategic Plan, set the budget for the Regional Economic Development Entity which includes the annual contribution amount by the shareholders and approve the auditors. 

The intent of the Regional Economic Development Entity is to complement, not replace, the work being done at the local level by area municipalities.  The bottom line is, as a Region, we need to increase our profile and marketing efforts to be able to attract investment, jobs and talent to this Region.  The new Entity provides a mechanism to dramatically expand our outreach and messaging, while providing a collaborative framework for local economic development practitioners to support these efforts and provide "on the ground" resources that can follow-up on investment prospects and potential opportunities.  

See Schedule A for additional background on the Edmonton Metropolitan Regional Economic Development Entity, Schedule B for the Memorandum of Association, Schedule C for the draft Articles of Association, and Schedule D for a News Release from the City of Leduc.
The City could delay signing on as an early municipal adopter by the May 24, 2017 deadline until the Regional Economic Development Entity is up and operating.  However, this later opt in privilege will be on terms and conditions set by the early adopters and eliminate any opportunity to participate in the selection of the Board or set the initial operating direction.  Spruce Grove has been a leader on this Regional Economic Development Initiative to this point and any decision to defer would be seen as a softening of our position on the need for regional collaboration to promote economic development.  
The City has been extensively involved in the development of this initiative over the past three years.  It has been sponsored by the Capital Region Board (CRB) which provided direction for the creation of an arms length entity to coordinate and strengthen economic development efforts at the metropolitan Edmonton level.  The City's Economic Development staff have also been involved at the working level to support the Steering Committee in the preparation of an Edmonton Metropolitan Region Economic Development Framework and Strategy 2015-2018.  
The Regional Economic Development Entity is a separate entity from the CRB.  The CRB will continue to support the start-up of the Entity until the Board is appointed by the shareholders and the CEO is hired.  Once the Entity is formed and staffed, CRB Administration will no longer be involved other than another Regional Stakeholder.  The CRB's interest would be to ensure alignment with the Growth Plan.  

The official sign-on for those municipalities wanting to be the early adopters is scheduled for May 24, 2017.  The intent is that the early adopters will be the ones making decisions about opportunities for other municipalities to opt in following the initial deadline.  
The intent of the Regional Economic Development Entity is to complement the work being done at a local level by the area municipalities.  Its mandate is to establish a Regional Brand that provides common messaging to promote the Region; coordinate the development of a Site Selector Database of regional assets, and build a Regional Economic Development Strategy.  The bottom line is as a Region we need to increase our profile to be able to attract investment, jobs and talent to this Region and grow our economic base.  

Fiscal Impact
Financial Implications:
The motion calls for a three year funding commitment to the Company with such annual payment not to exceed $45,000 in 2017, $60,000 in 2018 and $90,000 in 2019.  The actual numbers are quite variable and tough to peg down until we know how many municipalities are signing on.  Until May 24, when we have the full list of municipalities, the numbers will continue to fluctuate, hence the maximum - not to exceed motion.  

In the draft Articles of Association, there is a funding formula set out.  If all municipalities sign on, the cost allocation for Spruce Grove would be $22,695 in 2017. 
The Edmonton Metro Economic Development initiative is included in the approved 2017-2019 Corporate Plan with a budget of $25,000 per year for 2017 to 2019. If additional funding is required, it will be managed within the approved 2017 budget and future funding requirements will be included in future budgets.
Regional Economic Development Backgrounder
Memorandum of Association
Articles of Association
Leduc News Release

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