Start here

Winners and Losers: Sports in Sudbury

I have been reading articles in the journal Regional Science and Urban Economics because I am teaching Regional Economics this term. I came across “Sports facilities, agglomeration, and public subsidies” by Brad R. Humphreys and Li Zhou in the September 2015 issue.

It is a long and technical piece with an interesting summary of who wins and who loses when a city creates an arena district. The analysis obviously applies to Sudbury, and it is really too bad I didn’t find the article before we here made our fateful decision about where to put our new arena. The authors write:

“The creation of an arena district generates both losers and winners. The losers are service providers at the existing consumption center, who either experience a reduction of profits or have to exit the market, and owners of residential properties within a certain range of the existing consumption center, who experience a reduction in housing values due to the decline of services supplied in the existing consumption center.

“The winners are service providers in the arena district, who make positive profits because of the agglomeration effects of the new sports facility, and property owners within a certain range of the new professional sports facility, who experience an increase in property value due to the increase of service supply in the area.”

Council created winners when it decided on a location for the new arena. It also created losers, as I pointed out in posts last year. It would be nice if proponents of the project would be a bit more honest about the game they played.



A Casino Will Not Help Greater Sudbury’s Economy

There are still a few people who think that a casino will be good for the local economy. As an economist I find this pretty mysterious.

In the past, two kinds of communities have benefited from casinos: major tourist destinations and empty crossroads. If you are already a destination for tourists — and Sudbury is not — then adding a casino can supplement established attractions. The Big Nickel Mine is not the kind of established attraction with high-level casino synergies.

If you live in Nowheresville, a casino can’t steal customers from local businesses and can create some local and travelling gamblers. Sudbury is not Nowheresville.

Sudbury is just another town the province wants to suck money out of. The best guess I have seen about how much more the province will suck out is about $50 million more a year. This money comes out of the revenues of other businesses.

Council hopes to get 5 per cent of the casino net take — or about $2.5 million a year. This is Judas money: Council is selling out existing business for 30 pieces of silver. In the musical Jesus Christ Superstar, Judas sang: “Please  don ’t say I’m/Damned for all time.” That chorus could become the theme song for members of this council.

The increase in gamblers will come from Sudbury. With casinos in the Sault and North Bay, and possibly one on Manitoulin, there is no way that a Sudbury casino will be a big attraction.

The truth is that a Sudbury casino will make lot of money for the province. It will probably be built whether we like it or not. The past city council agreed to allow a casino because they thought they could get the corporation to pay for our new arena. The current council has decided to pay for an arena to bribe the casino to come. There are suckers elected every four years.

But the key point I want to make, as an economist, is that a casino is not good for the Sudbury economy. Don’t pretend it is.

(originally published as a Letter to the Editor of the Sudbury Star – online, January 1, 2018:

Robinson For Sudbury-007-cropped


Re-Amalgamation the Only Solution for Greater Sudbury

The forced amalgamation of the City of Sudbury and the surrounding municipalities has not been a success. Costs have risen, democracy has declined, and a more powerful bureaucracy has emerged.

The City of Sudbury and its suburban communities were reorganized into the Regional Municipality of Sudbury in 1973, and was subsequently merged in 2001 into the single-tier city of Greater Sudbury. The major benefit, from the point of view of the provincial government, was that it reduced the number of democratically elected representatives. The superglue bill that stuck all the communities together, you recall, was called the “Fewer Municipal Politicians Act.”

Some might argue that what Mike Harris has joined together no person should sunder. It is done, they say, and the people of the region should just suck it up. Certainly the recent study by the Fraser Institute suggests that it is very difficult to undo amalgamation. Not impossible, but very hard.

But de-amalgamation is not the answer to the mess made by a forced and baldly thought out amalgamation. The real answer is RE-Amalgamation.

Re-Amalgamation means re-thinking the structure based on our 16 years of experience. What we know now is that the communities of this “Constellation City” are not happy with the result. In 2006, faced with growing discontent and a growing de-amalgamation movement, the City set up a Community Solutions Team.

Sudbury mapThe Team adopted the concept of a “Constellation City” made up of individual “stellar” communities. The committee offered recommendations that would make the city “Connected, Caring, Empowered and Equitable.”

The recommendations of the Team have not been followed and the problems have not gone away. Many outside the core still feel disenfranchised. Decision making has not been localized. Transit is only slightly better. The Community Action Networks are still a pathetic imitation of participatory and democratic local institutions. Ward boundaries still chop communities up. The old core downtown communities in particular are still poorly represented.

The notion that anything would be solved by directing $2 per person to the CANS was always absurd. Token democracy is token democracy no matter how hard you wish.

In fact the City needs to reconstitute the local councils, and to return significant decision making to the local councils. There is no good reason for the representative for Long Lake to vote on whether Valley East should purchase a surplus school for a community center. If people in Valley East want to pay for it that should be their decision.

There is only one reason why the New Sudbury representative gets to vote about amalgamating arenas up the Valley. Under the current structure, the people of the entire region now pay for recreational facilities for residents of the Valley. It is an application of the principle of no taxation without representation. But it does not make sense to tax people in New Sudbury for recreational facilities that they don’t use in other areas. Before amalgamation these communities built their own arenas and cut the grass on their own soccer fields. They could do the same under Re-Amalgamation.

In the Fiscal Swamp of Greater Sudbury, the people of the Valley no longer are responsible for their own community, and they have little say about what they want. Amalgamation has diluted everybody’s voice. That is a profound misunderstanding of democracy.

And it can lead to massive overspending. ‘Logrolling’ is defined as the practice of exchanging favors, especially in politics by reciprocally voting for each other’s proposed legislation. You vote for my road expansion and I will vote for yours. My people get a road, but they think they only pay for part of it. The result is well known to students of political science – ballooning budgets as politicians collaborate to get benefits for their own areas, even though their citizens end up paying more overall.

The right solution is that people in the south of the city should only contribute to roads or recreation in the north part of the city IF they are convinced that they actually benefit. That word “convinced” is central to democracy. If our kids in the south use 10% of the arena, we should contribute 10% of the cost. If the people in Azilda want their road four-laned, they should just go ahead an four-lane it. The province should and will contribute part of the cost because it is part of the provincial highway headed to Timmins. The people of Garson have no stake in that road. Users should decide and users should pay.

Sharing costs this way is actually a cooperative model of city finance. Communities build what they want for themselves and the negotiate if they want other communities to contribute. Working out acceptable cost shares for projects would achieve fair allocation of costs and genuine empowerment of communities. We would probably see a lot of local referenda if we had real local democracy. Referenda may cost time and money, but they are a better way to spend than on unwanted or overpriced projects.

Changes like this are within the power of the existing council. The City does not have to ask permission to Re-Amalgamate. All it has to do is recreate local councils and hand over to them the right to make specific decisions about local issues as well the power to set local budgets for local projects. The Council of the City of Greater Sudbury would only deal with coordination and issues that affect more than one community.

Does this sound like the old Regional Government model? It isn’t too far off. Regional government was actually working, so why not? But with a bit of thought we could achieve an improved version. We could keep any savings that come from centralized purchasing and centralized service provision. We might have a common land use plan and might share snow plows. We could have a real “constellation City.”

Re-Amalgamation is legal and feasible. It should be done gradually and carefully, but the process should be started soon.

On Monday, October 22, 2018, when the next city election comes around, the citizens of Greater Sudbury should elect a council that really wants to fix the mess that an ill-considered amalgamation brought us.

Vote for the Re-Amalgamation candidate in your ward.

Time for Robert Kirwan to Resign

As an economist I have been greatly impressed with Councillor Robert Kirwan’s ignorance of economics and economic development. As a citizen I am absolutely overwhelmed by his arrogance and incivility.

It is fine for him to call me a washed-up dinosaur – I was actually pleased to have him show he couldn’t respond to the actual content of what I said. Now, however, he has badmouthed one of Sudbury’s genuine heroes, one of the city’s most tireless and effective advocates. It is time for Robert Kirwan to learn some manners. It is time for Robert Kirwan to listen to the many people who know a lot more than he does about this city. And it is time for him to step down.


Ward 5 Councillor Robert Kirwan (CBC)

The man that Robert Kirwan thinks he can pull down is one of the leading political thinkers in Northern Ontario. He is Northern Ontario’s leading publisher. He is one of the North’s most impressive businessmen. He is one of Northern Ontario’s best known writers. If you Google “Michael Atkins the rest of my life” you can read a hilarious account of how he came in 1973 to be the owner of a bankrupt dog of weekly newspaper called Northern Life. It is just one of over 1500 columns he turned in.

Atkins is one of Northern Ontario’s most impressive community activists – he has been director of the Sudbury Chamber of Commerce, the Ontario Chamber of Commerce, the Sudbury YMCA, the Sudbury Theatre Centre, co-chair of Sudbury 2001, director of the Northern Centre for Advanced Technology at Cambrian College Sudbury, and more going back 45 years.

Ward 5-2014 Results

City of Greater Sudbury – 2014 municipal election results – Ward 5

Robert Kirwan is a freshman councillor who got fewer votes that any other person in this council. He has been an energetic advocate for the worst decisions this council has made. He has ignored the advice of city consultants and insulted knowledgeable members of the community. His only legacy at this point is debt and dissension. Now he is throwing mud at a citizen who has contributed an enormous amount to this community.

Kirwan writes, “Look at how much Mr. Atkins and his like-minded downtown supporters have been able to do for our city.” He must be referring to little things like creating the mining supply journal that is marketing our city around the world. Maybe he means serving as Chair of the Board of governors of the University as it brought new programs, new students and millions of dollars to the city. He may be thinking of the his role on the board of NorCAT incubating innovative businesses, or creating the Northern Ontario Business Awards to promote northern businesses.

Michael Atkins doesn’t need me to swat flies for him, obviously. The point of this note is that the City of Greater Sudbury doesn’t need councillors poisoning debates and badmouthing citizens. It doesn’t need a councillor who throws insults at everyone who disagrees with him. It doesn’t need a councillor who imagines that real thinking began when he got onto council. It doesn’t need a councillor who doesn’t even know the history of the city.

It is time to resign, Robert. You are making bad decisions and you are making rational, constructive discussion impossible. Your ignorance is annoying, but your incivility is unacceptable. Time to grow up or step down.

Atkins: Your taxes and how not to manage risk,” Michael Atkins, Sudbury dot com, December 1, 2017.

Council to Continue Gutting the Downtown

On November 22 council will decide whether to tear down the Community Arena to build a new library, Art Gallery and Convention Center. Under the plan that will be presented to council is to wait until the Wolves can move to the city’ new arena out in the east end – say two years, then tear down the current arena, then build a complex of new buildings on the site.

Under the best possible scenario, the project will take at least four years and it is likely to take six. For all that time there will be a big hole in the downtown. Business development in the area is likely to come to a screeching halt. Tax revenues will certainly drop for years.

Under the worst scenario the next council will find that the cupboard is bare and they will postpone the project. No new art gallery, no Synergy Center, no new library space. We will look at the downtown and say “Did that council ever leave a mess!”

The most logical strategy for the city is to look for a partner that wants to build a new hotel and conference center integrated with the Synergy center and connected to the old arena. The city has already assembled almost all the land between the Arena and the Sudbury Theatre center. What a magnet that hotel would be! An upgraded arena on one side, a theatre on the other, with the public arts attached.

By building together the value of a hotel on the site would be much greater. The city would make money by selling some of the land. With City hall to the north the complex would easily support a multilevel parking complex. As a tax generator it makes the Kingsway project look like a peanut farm.

Of course this takes vision and an entrepreneurial council. We have a council that has shown little vision and less judgement on economic issues. We have a council that has thrown money at projects that don’t promote the economy and is now considering undermining projects that do have some chance of strengthening the economy.

Staff basically killed the Minto-Shaughnessy solution by treating the a single block with a lane cutting through it as two separate sites. Both halves of the block are a bit small. Using the site evaluation scheme each half is less attractive than the tear-down plan. Taken together the two halves of the block clearly win. It will be interesting to see if council is taken in by this trick.

The report from staff assures council that “there are no immediate financial implications.” Given that council has already committed more money than it can afford to the Maley drive white elephant and to an Arena for Dario and the casino corporation, zero cost coming up to the next election is a major attraction. Unfortunately, council is just kicking the cost down the road. The next council will have to come up with funds to tear down the Arena, and it could be the the council after that has to find funds to start construction on projects that this council says it wants.

Council really should put out a call for proposals from hotel developers who want to partner in the most exciting project in any city in Northern Ontario. Instead it looks like this council’s legacy will be a big hole in the center of the city.


Do Your Neighbours Know?

Do you think your neighbours understand how serious climate warming really is? Do they understand that on our current path at least a billion will die, jellyfish will take over the oceans, oceans will take over Florida, deserts will take over the central USA, and any vestige of traditional Inuit life will disappear?

I don’t mean to be alarmist here. These are just the basic and standard signposts on the path we are following. It is true that many countries have begun the process of getting rid of fossil fuel driven cars and that the technology is already available. It is true that the coal industry has as much future as a beached whale. And Canada has a small carbon tax coming in the near future.

It is also true that that the best estimates of the effect of all these steps still leave us in the “climate disaster” zone in 50 years.

Do you think your neighbour knows that the Federal carbon tax and the provincial Cap and Trade schemes are wildly inadequate? That the Provincial minister of energy doesn’t understand the path we are on or the economics of changing direction?

It matters whether our neighbours know. The action we need has to at happen the political level. Our politicians believe the public neither know or cares. They are clearly trying to follow public opinion rather than lead. That means that in a crazy way our neighbours are the leaders.

Hence the question: “Do you think your neighbours understand how serious climate warming really is?”

And if they don’t, what do we do?

It’s Not the End of the World Yet

Its not the end of the world yet.

If you were one of the surprising number of people who shared my worry about my sister in Puerto Rico, you can stop worrying. Andy, the sister, climbed a mountain to be close enough to a cell phone tower to get a call out to her husband. He in turn has posted news that eventually reached me. (She still hasn’t called me, so of course I will never forgive her.)

Her son Iancy got to the island before Maria hit and is helping with the cleanup. He spent a night in line to get gas for the generator. And he has posted a picture that proves Andy is alive.

Watching this climate-change disaster unfold and seeing how ill-prepared the richest country in the world is has me wondering how we will weather (no pun intended) the disasters headed our way. We have done very badly with the recent floods and fires. The Quebec ice storm wasn’t encouraging.

Storms will get worse as the globe warms. This could be the year we get a massive ice storm in Northern Ontario. The heat that drives the hurricanes also drives winter storms. It can suck Arctic air down across Canada and the USA and combine with wet Pacific, southern or lake air to produce an ice storm. This could be the year the power goes out.

I am from the west coast where winters are warm. I never owned winter boots and had no idea what 10 below felt like. As winter comes on each year a voice deep inside starts to whimper that we are all going to die from the cold.

Are you prepared? I’m not. My gas furnace doesn’t work without electricity. I am wondering whether many Sudburians have any kind of backup heat.

So what should we be dong? How many of our neigbours are at risk? I am not a prepper – not one of the more than three million Americans and Canadians getting ready for the end of the world by building fortresses and buying guns. I am starting to wonder, though — unlike the preppers — how we will take care of our neighbours when climate warming or earthquakes shake the foundations we rely on. I would rather we get ready to support our neighbours instead of buying guns to shoot them. it just seems more Canadian!.

What do you think?