Fraser City

Economic Development Annual Report 2015

A Place to Call Home

Fraser City Economic Development Department March 31, 2016

Highlights

Letter of Introduction

Tommy Orr, Mayor:

Fraser City has seen an exciting amount of growth in the past year. We are thrilled to welcome new businesses to the community, and proud to support the fantastic companies that have worked tirelessly to provide household sustaining jobs and improve our local economy. Initiatives such as ongoing infrastructure development and knowledge-led sector development have led to exciting advances in the community’s business sector. In addition, progress continues to be made on the Economic Development Department’s anchor initiative, the business retention and attraction program.

With the significant steps made in 2015, the Economic Development Department and Fraser City are looking forward to continuing to work with our partners across the community and beyond.

Overview

Business Retention and Attraction

The Business Retention and Attraction program saw a busy year with the Business Walk program, quarterly panel seminars, business care, outbound trade missions all undertaking significant activities in 2015. This resulted in several exciting successes.

Infrastructure Development

Work on land assembly, brownfield remediation and fibre optic development program allowed Fraser City to prepare for the next stage in business expansion and attraction. This work has allowed Fraser City to begin addressing a historical concern around employment land development in and around the community.

Knowledge-led sector Development

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | i

BRE & ATTRA

CT$1.5 M

New Investments

4 Business expansions

12 New Jobs

INFRASTRUCT

URE DEVELOPMEN

T

8 km New Fibre

Optics

1 Redevelopment

Project

110 acres New Industrial

Land

Aligning with the strategic plan goal to diversify the community’s economic base in emerging, non –traditional industries, work was successfully completed on the bylaw update, market material development, and another successful year of operation at the high technology incubator.

Key themes

The Fraser City Economic Development Department continues to work on three strategic initiatives including:

Business retention and attraction; Infrastructure development; and, Knowledge-led sector development.

Overall, notable progress was made in each of the three strategic initiatives in 2015. The business retention and attraction program achieved a notable milestone when it hosted its first inbound trade mission with three businesses visiting the City after showing interest in investing locally. This is anticipated to accelerate with additional firms arriving in the City to see what we have to offer.

On the infrastructure development initiative, 110 acres of new industrial land became available locally for development, and 8 kilometres of new fibre optics opened up another area of the community to high speed connectivity. In 2016, the Economic Development Department is looking forward to leveraging this new infrastructure in support of business attraction efforts.

Finally, it was an exciting year for the knowledge-led sector development with the completion of the revised bylaw to support knowledge-led business attraction and expansion. In addition, Fraser City saw the first graduate of the high technology incubator program establish a new business locally. Fraser City is looking forward to more success from its local entrepreneurs and attraction efforts in 2016. Stay tuned for more on this front as opportunities emerge.

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | i i

INNOVATION &TECHNOLOGY

11 new high tech

jobs

3 New

entrepreneurs

1 New high tech

business

Table of Contents

1. Introduction.................................................................................................................5

2. Context.......................................................................................................................52.1 Our people.....................................................................................................................5

2.2 Our service area............................................................................................................5

2.3 Historical context...........................................................................................................6

2.4 Year in review................................................................................................................6

3. What are we doing?...................................................................................................63.1 Vision, mission, core values and principles...................................................................6

3.2 Goals.............................................................................................................................7

3.3 Programs, initiatives and services.................................................................................7

3.3.1 Business Retention and Attraction Program................................................................7

3.3.2 Infrastructure Development.........................................................................................7

3.3.3 Knowledge-led sector Development............................................................................7

4. How are we doing?.....................................................................................................74.1 How do we measure economic development?..............................................................7

4.2 Tracking our progress....................................................................................................8

4.2.1 Program, BRE and Attraction Program.......................................................................8

4.2.1.1 Business Walks in the downtown commercial district................................................8

4.2.1.2 Business Care............................................................................................................9

4.2.1.3 Outbound Trade Mission............................................................................................9

4.2.1.4 Successes for 2015....................................................................................................9

4.2.2 Infrastructure Development.......................................................................................10

4.2.2.1 Employment Land Assembly....................................................................................10

4.2.2.2 Brownfield land remediation.....................................................................................10

4.2.2.3 Fibre Optic Program.................................................................................................10

4.2.3 Knowledge-led sector Development..........................................................................11

4.2.3.1 Bylaw Update...........................................................................................................11

4.2.3.2 Marketing materials..................................................................................................11

4.2.3.3 High Technology Incubator......................................................................................11

Spotlight...............................................................................................................................11

4.2.4 Supporting research..................................................................................................11

4.2.5 Other community data...............................................................................................12

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 3

5. Looking ahead..........................................................................................................135.1 Priorities for the upcoming year...................................................................................13

5.2 Proposed changes to plans, programs, initiatives or services....................................13

5.3 Financial position.........................................................................................................14

6. Closing.....................................................................................................................14

Appendix A - References...............................................................................................15

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 4

1. Introduction

New businesses and residents continue to locate in Fraser City due to the desirable mix of modern infrastructure, affordable cost of living, access to key services critical to successful business operation and growth, and the vibrant river-side lifestyle. Fraser City continues to position itself as strategic business destination for within the British Columbia interior. The past year has revealed exciting new projects and investments that the Fraser City Economic Development Advisory Committee is proud to have played a part in bringing to our community.

2. Context

This section introduces our key people, those that are driving our economic development progress within the Economic Development Department. In addition, it provides context for our service area and brief information on our history and the activities of the past year.

2.1 Our people

Ken Stanley, Executive Director

Fraser City has all the potential to achieve excellence. We have an exceptional quality of life and a surplus of human capital. Our economy is connected by quality highways, reliable roads and mass transit.

Our strategic location in the heart of the interior of BC makes us an ideal place to expand service offerings. Put simply, Fraser City is the right place to do business if BC.

Supporting business development in our community is our economic development department staff including:

Ken Stanley, Executive Director, Economic Development Mary-Ann Richard, BRE and Attraction Manager Freddie Vezina, Sector Specialist Manager Tammy Jennings, Office Administrator.

Staff in the economic development department are supported by the Economic Development Advisory Committee, with representatives from council, staff and community business leaders.

2.2 Our service area

The Economic Development Department provides services for Fraser City. Fraser City is a part of the south-central Interior and collaborates with surrounding municipalities on some strategic marketing and investment attraction activities.

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 5

2.3 Historical context

Economic development delivery is through Fraser City’s economic development department. The current delivery structure has been in place for the past eight years, having been formulated after the completion of the last full economic development strategy nine years ago. Fraser City’s total economic development budget in 2015 was $350,000 which included payroll and administrative costs for four staff (three FTEs), and project funding of $150,000. The economic development department reports to council, and works directly with the Economic Development Advisory Committee established by the City.

2.4 Year in review

The number of new businesses rose by nearly 5%, while the number of new employees increased by over 10% from the previous year. This growth in business and employment helped the Local Area unemployment rate drop to 5.5% by the end of 2015 (down from 6.5% in 2011). Fraser City’s total construction value increased to over $700 million, up 35% from the previous year, with the growth attributed to increased commercial and industrial activity. The strong growth in commercial and industrial construction activity was concentrated on predominately new buildings, while industrial users continued to take advantage of a surplus of available inventory and brought the vacancy rate down to 5.5% (from 6.7% in 2014 and 7.5% for the same period in 2013).

At $350 million, up 26% from 2014, residential construction saw a strong increase in the single detached category. Semi-detached and apartment /condominium categories showed growth as well. Population in 2015 for the City was up a strong 1.5% over 2014. Over the past five years the population has grown by 4.8%.

3. What are we doing?

Fraser City is entering the second year of implementing the 2014 economic development strategy that was professionally facilitated planning workshop that led to the development of the three priorities currently being implemented.

3.1 Vision, mission, core values and principles

Our Vision

A resilient Fraser City, where highly engaged citizens, networks and organizations collaborate to build a sustainable economy.

Our Mission

To focus multi-stakeholder collaboration on diversifying and strengthening the local economic base through:

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 6

retaining and growing a healthy business base supporting existing businesses to thrive and grow in the high technology sector

locally strengthening economic and social sectors critical to the future of Fraser City addressing strategic infrastructure gaps in services

3.2 Goals

The strategic plan has four strategic goals including: Strong local business base Market and investment ready Development of high technology energy sector Population and business growth

3.3 Programs, initiatives and services

3.3.1 Business Retention and Attraction Program

The business retention and attraction program saw several key strategic activities in 2015 including: Business walks in the downtown commercial district; Quarterly panel seminars on four key topics; Business care program in which local business leaders meet to identify and resolve business

issues that arise. Supported by the BRE manager, the board meets once a month; and, Outbound trade mission to China. Travelled to China to meet with Canadian representatives to

establish contacts that can support key sectors in connecting to Chinese companies.

3.3.2 Infrastructure Development

Employment land assembly and marketing tools for specific key properties Brownfield land remediation efforts to bring key properties up to market ready status Establishment of dark fibre through the core commercial and industrial areas

3.3.3 Knowledge-led sector Development

Work with other departments to develop new flexible bylaw that accommodates high technology businesses.

Develop attraction program that focuses on the high technology energy sector. Explore establishment of a high technology incubator.

4. How are we doing?

4.1 How do we measure economic development?

A key component of evaluating Fraser City’s current economic and business conditions is the ability to provide timely and relevant information on the state of the regional economy. To that end, the Economic Development Department released the Fraser City Economic Indicators Report, which provides this important information in a format that is relevant to businesses and investors.

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 7

What our businesses are saying:“It was great to have the mayor and staff in my business to talk about our commercial area. He heard my concerns and there was immediate follow up. Good job Fraser City and the Economic Development Department.”

Johnny Bauer, Owner ~ Putt Putt Motors

These economic indicators provide detailed information on economic statistics, regional demographics, business activities, business investment opportunities, commercial and residential real estate and other areas of regional economic concern.

These benchmarks will be researched and reproduced on a quarterly and annual basis when new data sets become available. Future updates to the information contained in the report will be conducted by Fraser City staff.

Several of the findings in the report are very encouraging, including a total GDP (Gross Domestic Product) of $2.25 billion. Also, among similar sized BC cities, Fraser City is second only to Middletown in terms of the share of the population with post-secondary credentials (68%, ages 25 - 64).

Specific to the economic development activities undertaken by the Economic Development Department, we monitor a series of program-specific indicators as outlined below in order to ensure our initiatives are staying on track to program objectives.

4.2 Tracking our progress

4.2.1 Program, BRE and Attraction Program

4.2.1.1 Business Walks in the downtown commercial district

The business walk program was very successful in 2015 with over 60 local businesses being visited by a committee of staff and elected officials. This initiative was led by the mayor. Each business was visited by one staff member and one elected official with a range of topics discussed, including what is working well and what is not. A total of 25 separate business issues were flagged

by the visits for City staff to follow up on. A total of 20 of these issues resulted in immediate changes to City activities to address the specific concern. This marks direct efforts by the City to address the business community’s concerns about City Hall creating “red tape” and making it difficult for business to respond to demand.

Quarterly Panel Seminars

In 2015, Fraser City hosted four quarterly panel seminars to help shed light on important topics of interest for business owners. With feedback from Fraser City companies, the four topics selected for this series were:

Information gathering for businesses Branding, marketing and sales Strategic Planning Succession Planning

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 8

25Business issues

flagged

52Businesses

received technical

assistance

These panel seminars were undertaken with 4-5 local experts leading each discussion. This project was very popular, and was of great value to the many who attended.

4.2.1.2 Business Care

Business care is administered by our Business Retention and Expansion (BRE) manager and supported by our Business Care sub-committee. The sub-committee is made up of 12 board members with expertise in marketing, site location, finance, human resources, and City services. In 2015, the board worked providing support to 42 businesses, with 6 of these businesses going on to do further in-depth business analysis with an independent consultant supported by the Fraser City Economic Department.

4.2.1.3 Outbound Trade Mission

In 2015, Fraser City conducted its first outbound trade mission with City staff and the mayor conducting one trade mission to China. This mission resulted in conversations with 25 separate businesses and led to Fraser City hosting three inbound business visits, and resulted in the Chinese Box Company purchasing the Old Town industrial site for $1.5 million as part of their North American expansion plans.

4.2.1.4 Successes for 2015

Overall, 2015 was a very successful year for the BRE activities and investment attraction program with 4 businesses expanding, 12 new jobs created, and $1.5 million in investment attracted. These represented the first outcomes associated with the delivery under the new strategic initiatives.

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 9

42Businesses

assisted

3Businesses

hosted

4 Business

expansions

$1.5m New investment

12 New jobs created

4.2.2 Infrastructure Development

4.2.2.1 Employment Land Assembly

Infrastructure development focused on inventorying City-owned land and preparing for specific development needs. In 2015, the XYZ property that was purchased by the City in 2011 saw upgrade to site services and is now ready to be resold as a key commercial property. The City has listed the property with regional realtors and is marketing through britishcolumbia.ca in an effort to attract an investor to develop this property within this strategic location. This represents the first tangible accomplishment in addressing the demand for new developable lands locally.

4.2.2.2 Brownfield land remediation

Work has continued at the old Bigmill industrial site. This brownfield site has five industrial parcels with a total of 110 acres. In 2015, the Economic Development Department worked with the land owner and the province to reclaim these lands for remediation. The land owner has made good progress and was able to gain all necessary permits to resell the land. In 2016, the Economic Development Department will begin working with the proponent to market and sell these lands. This land redevelopment has the potential to be a key job creator in the community moving forward.

4.2.2.3 Fibre Optic Program

Finally, Fraser City was able to complete additional work in laying four kilometres of fibre-optic cable in its Skytop industrial park and four kilometres of fibre in its downtown commercial core. The larger vision is for the City to become a “gigabit smart” community, following the path blazed by other successful communities across the country. Our objective of connecting every home and business to a fibre-optic network is critical for our pursuit of knowledge-led technology development.

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 1 0

1Redevelopment

Projects

8 kmNew fibre

optic cable

110 acres

Of new industrial land

available for development

4.2.3 Knowledge-led sector Development

4.2.3.1 Bylaw Update

Work on attracting new knowledge-led companies was ongoing in 2015. The City Economic Development worked with Planning Department to rework the City’s bylaws to increase the flexibility for commercial zoned lands to accommodate a wide range of knowledge-led business activities.

4.2.3.2 Marketing materials

Marketing materials for specific knowledge-led sectors were developed in 2015. In addition, a data base highlighting specific companies that should be targeted was developed along with conferences that should be attended in 2016 to further connectivity with the sector.

4.2.3.3 High Technology Incubator

2015 marketed the second year of operation of the high technology incubator. This is a partnership with the local University that is starting to see its first emergent successes. Three new entrepreneurs took up residence in the incubator in 2015, and the XYZ High Technology Company graduated from the incubator, leased a local location and expanded its workforce from three to fourteen.

Spotlight

4.2.4 Supporting research

In 2015 Fraser City reached out to the business community to gather feedback on the region’s business climate. The Business Conditions Survey was delivered to local businesses, obtaining Fraser City companies’ impressions on matters including access to financing, staffing, capital investments, sales revenues, and general operating business climate. This survey presents information needed to address many of the issues that most influence business decisions locally. Results will be available in early 2016.

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 1 1

1Partnership with

education institution

3

New entrepreneurs

11

New High tech jobs

1

New high tech business

investment

4.2.5 Other community data

General indicators of regional economic change are shown in the following community dashboard. The indicators are affected by multiple forces and events. They are partially influenced by the City’s economic development programs but not to the extent of a valid cause-effect relationship. Nevertheless, they underline broad economic change as a context for our programs. The population is growing steadily although many newcomers are retirees—our labour force is therefore declining due to a lower than average workforce participation rate.

A recovery in the natural resource sectors has improved the unemployment rate, although it is noted that many residents are commuting to northern areas of the province to service the expanding energy sector. The City will continue to pursue a higher jobs-to-population ratio in supporting our overall economic development goals. Building permits have fluctuated over the last five-year period but are trending upward over the last three years, led by commercial and residential development. 2016 was an anomalous year due to the completion of the new Community and Events Centre in downtown. Housing activity is consistent and indicative of a balanced market with positive demand from new residents. Many units are in the multi-residential category, which is providing greater diversity in our overall housing stock.

Example Community Indicator Dashboard

2016 2017 2018 2019 2020 TrendPopulation 40,755 40,555 41,785 42,050 42,640 % change 0.32% -0.49% 3.03% 0.63% 1.40% Labour Force 18110 18115 17980 18110 18050% change -0.63% 0.03% -0.75% 0.72% -0.33% Unemployment 7.5 7.8 7.1 6.8 6.6 % change 2.74% 4.00% -8.97% -4.23% -2.94% Total Building permits 123,915 62,092 51,801 92,626 110,290 % change 69.11% -49.89% -16.57% 78.81% 19.07% Housing starts 167 123 114 130 135 % change -11.64% -26.35% -7.32% 14.04% 3.85%

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 1 2

5. Looking ahead

In the coming year, the Fraser City Economic Development Department has an active agenda.

5.1 Priorities for the upcoming year

BRE and attraction program - we are looking forward to conducting an additional four seminars, targeting assistance for over 45 businesses, conducting two trade missions and preparing for 10 inbound business visits. The Fraser City Economic Development Department is targeting two new business expansions and one new business attraction with a goal of creating 20 new jobs locally.

Infrastructure development – we will move forward on industrial land marketing with a target of selling at least one industrial property in 2016. There are also further plans to install an additional six kilometres of fibre optic cable.

Knowledge-led sector development - is looking to add two additional new entrepreneurs to the high technology incubator in 2016 and will be working to see the expansion of jobs among existing knowledge-led sector by 10 employees. The City Economic Development Department is also anticipating stepping into high gear on their business attraction efforts, looking to have personal meetings with leaders from 40 different knowledge-led companies.

5.2 Proposed changes to plans, programs, initiatives or services

Based on a review of our performance for the last operating year, the department is proposing the following three tactical changes in our upcoming annual work plan:

The outbound trade mission to China was a success but it was also premised on a specific opportunity that emerged through the BRE program. There is no plan for the current year to conduct another outbound mission, as the department prefers to emphasize in-bound initiatives and is developing stronger relationships with site location professionals.

While good progress has been made on remediating and bringing the Bigmill site to market, there is concern that demand will remain soft for land zoned for traditional heavy industrial use. A repositioning of the site to other potential uses may be in the best interests of the City and its business community but there is little empirical research on which to prepare a firm business case. Our department has proposed an industrial land study and strategy that would be undertaken in cooperation with the Development Services department. We are awaiting word on funding applications for this work with the federal government and the BC Real Estate Foundation.

We will continue to closely monitor the High Technology Incubator and the services it provides. This area of economic development is evolving rapidly and there may be opportunities for accelerator-type services involving a greater range of financing and funding options. While there

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 1 3

is a good cluster of tech entrepreneurs in Fraser City, access to venture financing continues to be the single business obstacle for new business development. We will be exploring best practices in this field in the upcoming year and collaborating with the Community Futures Development Corp and the Business Development Bank on a possible accelerator program.

5.3 Financial position

Fraser City Economic Development Department is an integrated part of Fraser City and as such budget details are contained within the City’s annual report.

6. Closing

The Fraser City Economic Development Department staff and Economic Development Advisory Committee would like to express gratitude for our community partners, stakeholders, supporters and the Fraser City area. It is a privilege to shine a spotlight on this community, for residents, visitors and business leaders alike. We intend to continue efforts to increase the area’s profile, look forward to continuing to support our city’s strong and vibrant local business community and making further inroads in developing new local home-grown high technology companies and attracting knowledge-led energy companies.

All questions can be directed to:Ken Stanley, Executive DirectorFraser City Economic Development Department1235 Crosby Rd, Fraser CityTel: (778) 444-1962Em: ken.stanley@frasercity.ca

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 1 4

Appendix A - References

BC Stats. 2015a. British Columbia Regional District and Municipal Population Estimates 2011 to 2014. Available at: http://www.bcstats.gov.bc.ca/StatisticsBySubject/Demography/PopulationEstimates.aspx. Accessed August 15, 2015.

Statistics Canada. 2013b. National Household Survey Profile. 2011 National Household Survey. Statistics Canada Catalogue no. 99-004-XWE. Ottawa. Released June 26 2013. Available at: http://www12.statcan.gc.ca/nhs-enm/2011/dp-pd/prof/index.cfm?Lang=E. Accessed August 18, 2015.

Statistics Canada, Income Statistics Division, 2012, Annual Estimates for Census Families and Individuals By Postal Cities.

Statistics Canada. nd. Statistics Canada, Complete Cumulative Profile, 2006 Census. 2006 Census Semi-custom Profile of B.C., HAs, HSDAs, LHAs, MHAs and College Regions. Available at: http://www.bcstats.gov.bc.ca/StatisticsBySubject/Census/OpenData.aspx. Accessed September 7, 2015.

F r a s e r C i t y A n n u a l R e p o r t - 2 0 1 5 P a g e | 1 5