Is Yellowknife spending enough on its economic future?

Yellowknife needs to spend more money mapping out the city’s economic future beyond diamond mining, a new councillor says.

Rob Warburton said on Monday the newly approved 2023 budget “missed the mark” in not adding more money for programs that would grow and diversify Yellowknife’s economy.

“We’re spending almost as much on a new surface in the fieldhouse as we are on the entire economic development department of the city,” said Warburton, who led the city’s chamber of commerce before being elected to council in October.

Yellowknife’s draft 2023 budget allocated $347,000 for the activity of economic development amid broader spending of $1.7 million on the economic development and strategy department as a whole, including $1 million on wages and benefits for six staff – three of which are jobs directly related to the city’s economy. (The others are a communications advisor and two municipal law and policy managers.)

“The paltry budget allocation this department receives, this year and in previous years, speaks volumes to how low a priority this is currently,” said Warburton.

“We are all aware of the economic shifts coming in the next couple of years. To continue to budget economic development and community growth as optional, instead of required, is only going to increase the pressure on residents through property tax increases in future years.”

Warburton wants the city to focus on growing its tax base and addressing its housing shortage. He urged fellow councillors to approach decision-making in the next year “with a lens of growth, reducing economic barriers and empowering residents and businesses.”

Rebecca Alty, Yellowknife’s mayor, said in response that she looked forward to setting a strategic plan for the city in the coming months.

“We’ve already approved more lots for industrial,” Alty said, referring to a recent expansion of the Engle Business District, adding council would soon “look at the commercial and residential area and I think that’ll be a pretty big focus area for 2023.”

New marketing body developed

Warburton’s dissatisfaction with economic development spending was made plain during budget deliberations earlier this month.

“I personally find the number for economic development kind-of embarrassing,” he said on the first night of discussions last week, asking staff if the department’s current funding was limiting the city’s ability to plan for the future.

“It’s a really good observation,” city manager Sheila Bassi-Kellett responded.

“More capacity, more money is always something that helps us advance, especially when we do have as many strategies and initiatives as we do on the go right now.”

Economic development director Kerry Thistle set out plans to launch a Yellowknife destination marketing organization – a body that markets the city both to tourists and investors. Bassi-Kellett said that organization would be a “very important focus” for the city in the year ahead.

“Right now, when someone wants to come to our city and invest in any way, it’s kind-of a choose your own adventure,” said Warburton. “There’s no real mapping it out. So I’m glad to hear that this may be an opportunity to do that, because it’s kind-of horrible right now.”

Implementation of an accommodation levy is also on the way, which is expected to generate revenue for the city to bolster its tourism and marketing initiatives. Both the levy and the destination marketing organization have been on the horizon for several years but became moot in 2020 and 2021 as tourism all but disappeared during the pandemic.

Various other strategies exist under the economic development file, such as an agriculture strategy, a joint economic development strategy with the Yellowknives Dene First Nation, and a vision for downtown revitalization. None of those strategies have specific, dedicated funding to advance them, relying instead on funding applications for certain projects to the likes of the territorial government.

Warburton is not the first city councillor to express concern that such proposals won’t, on their own, come close to cushioning Yellowknife against the economic blow of losing the Diavik diamond mine in 2025 and other mines in the following decade.

One member of the previous council, speaking privately shortly before October’s election, expressed doubt that anyone – at any level of government – had a clear vision for how to drive Yellowknife’s economy as diamond mining fades.

As budget deliberations wrapped up on their second day, Warburton concluded: “I don’t think we can sit here and say that we’re really taking economic development seriously, currently.

“We’ve got some headwinds coming here and this number, to me, doesn’t reflect the seriousness of what’s coming here.”