It came with the mandatory hoopla of a job well done - an annual job that nobody likes to do - but this year it was done well ahead of when it usually gets done so that is reason enough for celebration.
And no it was not your teenage grandchild taking out the trash without being told to do so; it was the City of Moose Jaw passing their 2020 Budget before the end of the year.
The big question to be asked in all of it is how did they do it so fast and what does Mayor Fraser Tolmie cruising up Main Street have to do with how Council finally decided to spend your money…OOPS! I suppose I should say the City’s money for 2020.
It all has to deal with a presentation made by local banker Greg McIntyre and how he said given an analysis of the City’s cash flows and present borrowings, the City had plenty of room to borrow money. Furthermore, given the historically low interest rates available, the City could potentially make more money on investment interest than they would have to pay back the banks if Council took full advantage of the opportunity being presented to them.
But for avid Council watchers out there this is the same advice, albeit from a different source we heard in 2019 9 and the City last year taking on a $30 million loan. It is a bit of Deja vu when you think about it.
Sage advice? Perhaps, but if you take a look at the advice from economists, 2020 may well be the end of the 10-year bull market and the inevitable stock correction is coming. If you are interested in what the experts are predicting for 2020 please visit https://www.wsj.com/articles/wall-streets-2020-prediction-the-stock-market-will-have-a-so-so-year-11575038295. Are the growing number of economists going to be correct this year? Or will the bull market continue?
But for those of you who read further into the Greg McIntyre presentation, you will find some very negative economic information in the discussion which bears out things the City is not really going to admit; that is Moose Jaw and our trading area are in the midst of a 24 or more month economic recession. Things are not as good and as rosy out there as some are leading you to believe.
It is something we wrote about in the past regarding the economic pinch local businesses are facing. As well, the Chamber of Commerce has admitted an economic slowdown in the recent article published in last week’s Moose Jaw Express interview with Chamber of Commerce CEO Rob Clark. Even Premier Scott Moe, speaking at a Sask Party Fundraising Event this past August in Moose Jaw, said the Province is still fighting "economic headwinds" and when you take a look at exactly what McIntyre told Council, Moose Jaw is right in the middle of that economic storm.
In his presentation to Council, what was said by McIntyre about the recession was the Royal Bank had extensive reports which show the Province is economically doing good in the two major centres but elsewhere in the province - including Moose Jaw and its trading area - there is an extended economic recession.
“...we have some fairly detailed reports within RBC that go into more RMs and surrounding areas it should suggest as though outside of Regina and Saskatoon the majority of the province has been going through 24 or more months of an actual recession.”
— GREG MCINTYRE - SENIOR COMMERCIAL ACCOUNT MANAGER ROYAL BANK OF CANADA
And what does McIntyre attribute the poor local economy to? It is the poor harvest in the past couple of years area farms have experienced.
For those who have been following the 2019 crop it is number three with the drier conditions cutting production in the growing season and the wetter conditions during harvest costing grades to area farmers. It was one of the longest and worst harvests in recent memory, as getting the grain dry and into the bin was a lot longer than the averages - including the Moose Jaw trading area.
When coupled with austerity moves by the Province, it has led to a situation where Moose Jaw being so heavily reliant as a service centre for agriculture and government jobs and/or projects finds itself in an economic recession. It is a situation where some economists (especially Keynsian) would call for an immediate government cash infusion to break the cycle of recession.
In the background playing away while McIntyre gave his presentation is The Conference Board of Canada that said Saskatchewan, as a province, has slipped into a mild recession this year. They attribute it to the same reasons McIntyre said the regional economy has been in recession for the past 24 months or longer - poorer crops and harvest conditions. The Conference Board of Canada is predicting one percent growth next year in Saskatchewan.
I personally thought back to the September 31, 2019 Quarterly Report of property tax arrears of $1,315,369 and taxes owing of $8,249,804 with only one percent in assessment growth as the report was given and thought, is this actually affordable or are we being asked to use the City’s Visa to pay off the MasterCard?
And yes the Province is set to spend literally hundreds of millions of dollars in Moose Jaw with the proposed new South Hill school - which Council was told during budget discussions has yet to finalize a location - and a new SaskPower natural gas fired electrical generating station, but the question needs to be asked how much actual construction work is going to happen this summer?
Is it just going to be sod turnings or actual jobs in what is a Provincial and Civic election year when Moose Jaw and its residents need an economic influx right now if not in the past summer of 2019? Is it all just politics?
The same goes for Canadian Tire; after three years the deal to sell just under 12 aces of land along Thatcher drive is now finalized. When will the infrastructure servicing start on the project and when will the actual construction begin?
Certainly, there are some in the community who are pointing to new small business investments by foreign investors as a sign the good economic times are on the way, which to some extent is true.
But on the other hand, some of the new entrepreneurs are just taking advantage of immigration programs offered by the Province to buy their way into Canada. The CBC has even tracked down how this has been marketed just next door in Regina and the Province’s reaction. If it is happening elsewhere in the Province, does it not make sense it could be happening to some extent in Moose Jaw as well?
Then you need to look abroad with the massive rise of Black Sea Grains - from Russia, Ukraine, Bulgaria and Romania - onto the world market and the impact they are predicted to have on the foodstuffs Moose Jaw now wants to get more involved with agri-food processing. It is already cutting into Australia's market and you have to ask yourself how long until it impacts Canada?
Competition for the same investment dollars as Ukraine is set to finally allow private land sales this year and the predicted explosive growth in one of the world’s last great land rushes for high value agricultural land - even the World Bank agrees. It all will compete with Moose Jaw and area, as lentils are set to be grown in larger acreages in Ukraine, giving them a decided transportation advantage to such places as Turkey.
So far, if you want to be serious and point some fingers of blame of what has truly happened at City Hall, it was the overspending in the past on people’s legacies and how they made their mark on Moose Jaw which has left us in the shape we are in. The present Council has been left with one hell of a mess to clean up during a major economic downturn and very few of them are brave enough to say it publicly.
So out of the blue, there was Mayor Tolmie doing what a community’s mayor is supposed to do, saying that things are not so bad and efforts are headed in the right way.
It all had to do with a cruise he took up Main Street and the Mayor only seeing four signs which were For Sale or For Lease in windows - two of which had been in the windows for a long period of time - to proclaim all is well.
What the Mayor did then was put a notorious spin on it all by stating the partners (Downtown Business Group, Tourism Moose Jaw, Moose Jaw and District Chamber of Commerce) he has been meeting with either informally or behind closed doors are doing a great job and Moose Jaw is by all appearances in great shape.
“I took some time today to drive up Main Street and I went from Manitoba Street all the way up to Ross and I wanted to see how many storefronts that there were lease signs and for sale signs and from Manitoba all the way up to Ross Street I noticed there were four vacancies...for the efforts we have been making with the Downtown Business group strengthening our Downtown core that looked very positive to me.”
— MAYOR FRASER TOLMIE
In the end, I could not but just sit back and wonder if people would actually believe it and would the little bit of rah rah be able to hide the true economic realities so many in Moose Jaw are facing.
Editor’s Note - The writer Robert Thomas attended university in Russia and has a family member who is an Odessa, Ukraine based grain dealer set to increase the sales of pulse crops into Turkey.
The views and opinions expressed in this article are those of the author, and do not necessarily reflect the position of this publication.
