Using tax money to kill jobs

CBRM Mayor John Morgan, facing serious opposition* for the first time in 12 years, is scrambling to justify his cash-strapped municipality’s snap decision to spend $6 million in tax money to block a private sector development that promised immediate jobs.

On just two days’ notice last month, CBRM outbid a private sector developer to buy the Greenfield Site, a 400-acre parcel on Sydney’s freshly dredged harbour.

At the time, Morgan said the so-called mystery developer planned to use the site for a bulk terminal that would permanently preclude its use as a container pier, the Great Big Project Morgan continually upholds as post-industrial Sydney’s only hope for a viable economic future.

In fact, Morgan knew who the bidder was. Prior to submitting CBRM’s own bid, he had received a letter from Atlantic Gateway Shipping Terminals Ltd. outlining the consortium’s previous efforts to promote a Sydney container pier, promising continued efforts in that regard, and offering to meet with CBRM to detail its plans for a bulk transshipment terminal as a stepping stone toward the shared goal of a container pier.

Morgan is best known outside CBRM for having launched a showy constitutional lawsuit to demand higher provincial equalization. The suit was an early and expensive flop in court, but it reinforced the mayor’s reputation at home as a scrapper, albeit a spectacularly ineffective one.

In fact, CBRM receives more than half of all the municipal equalization handed out by the province, but Morgan claims its anemic tax base can’t support essential services without a massive increase. So how could his cash-strapped government, already nearly $100 million in debt, whistle up another $6 million on two days’ notice?

No problem, said the mayor. CBRM will transfer the Greenfield Site to the Sydney Ports Corporation, which operates the city’s cruise pavilion and has the wherewithal to support the $6 million loan.

Not so, it now appears. The Ports Corp. is already $1.5 million in arrears on lease payments for its own facility, and has neither the inclination nor the financial capacity to take on a $6 million loan.

So CBRM taxpayers will be stuck with the $6 million tab after all, they will lose the tax revenue a $6 million property would have produced, and they may face a lawsuit from the rival bidder, angry at the city’s handling of the matter. They will not get the jobs required to build and operate a bulk transshipment facility, and the faint dream of a container pier has grown just a little fainter. More workers will move to Alberta, and more Cape Breton families will be torn apart.

En route to this triumph, Morgan has routinely vilified CBRM’s private business community, government agencies, politicians, the courts, and the other two levels of government — in short, everyone needed to help the struggling Cape Breton economy recover from the loss of two major industries.

This is Morgan’s schtick: he portrays Cape Bretoners as helpless victims and demands continual handouts, then throws rocks at anyone who might actually lend a hand. He is the single biggest impediment to Cape Breton’s economic stability.

* [Disclosure: I provided some early assistance to Owen Fitzgerald’s mayoralty bid, and may do so again, although I have no formal ongoing role in the campaign.]