The Edmonton Economic Development Corporation will come up with an extra $500,000 in its operating budget for TEC Edmonton, even if it means taking the money from another program or finding “efficiencies” elsewhere, says the agency’s chief executive officer.
“I’m not worried (about finding the money) because it’s a clear priority,” Derek Hudson said in an interview with Taproot Edmonton on Friday about topping up TEC Edmonton’s budget to make up for a drop in funding from the City of Edmonton.
“It’s easy for us to find funding for clear priorities.”
The city has provided $1.5 million in annual funding to TEC Edmonton through EEDC since 2014. Starting in 2020, the city’s financial contribution will drop to $1 million annually.
On Aug. 19, Hudson told Edmonton city council’s executive committee that EEDC — an arm’s-length corporation that gets roughly $20 million per year from the city — will bump up its funding for the tech business accelerator to make up the difference.
EQUAL PARTNERS, EQUAL SUPPORT
TEC Edmonton is a partnership, founded in 2006, between EEDC and the University of Alberta with a mandate to help emerging tech companies scale up. The top-up means that the city’s contribution will continue to match the $1.5 million in annual support from the U of A.
Hudson said matching levels of support was an important point noted by the TEC Edmonton task force, formed in 2018 to review TEC’s mandate and provide direction for its future.
The nine-member group, which included representatives from EEDC, the University of Alberta and industry, released its business plan recommendations for “TEC 2.0” last month.
“Everyone on the task force felt that we really wanted to emphasize that it was this equal partnership,” said Hudson, who was one of the members.
“The objectives were to take the best of the university and the best of the business community and maximize the economic value that came from that,” he said. “The task force saw that fundamentally the partnership between the two organizations was important and all of the other recommendations that came out were based on that assumption.”
RESPECT FOR ‘FISCAL REALITIES’
His early inclination was to go hat in hand to city council.
“My first thoughts were, ‘OK, then we’ll go to the city and tell them how important it is and ask for the extra $500,000.’ But when I thought about the city’s financial situation, I thought that would be counterproductive and not recognizing fiscal realities,” said Hudson.
Instead, EEDC will find money in its ongoing operating budget, which is typically set at the end of November, to make up the difference.
“I think [council was] relieved that we didn’t ask them for more,” Hudson said.
When asked how EEDC plans to make up the $500,000 gap, Hudson said the entire budget would be reviewed and priorities reallocated.
The money could come from “some other program or efficiencies in how we deliver things, or even efficiencies in working with TEC Edmonton,” he said. “There’s all kinds of factors that go into us setting our budget.
“I can’t tell you what that’s going to be and I’m not sure I’ll be able to tell you ever what it is.”
EEDC is under continued pressure from city council to clarify its role in light of the increasing congestion of Edmonton’s economic incubator space. Councillors have asked how its mandate and funding squares with that of Edmonton Global, a non-profit established by 15 regional municipalities to promote the capital city metro region.
Hudson said the process of gaining greater coherence and clarity between various city-funded players could “produce efficiencies” but stressed that what matters is getting economic results and “not to talk about who does what.
“Behind the scenes, on multiple levels, the EEDC people and the Edmonton Global people work together every day to try to do good work,” he said. “If there’s confusion in the community and at the municipal level we want that sorted out for sure, but our real focus is on getting the results and using the unique aspects of each organization to play into that.”
Whatever happens on that front, Hudson says keeping the “unique relationship” with the University of Alberta, with its prowess in artificial intelligence, medicine, dentistry and pharmacy, is crucial.
“It’s one of the key assets to the Edmonton economy,” he said. “We have an actual partnership agreement between the university and the economic development agency. That’s a treasure and we want to maintain that, and maintain that thinking, and so we want to fund it at that level.
“And then we’ll figure the rest out.”
- Tech Roundup, Aug. 20: Executive Committee accepts TEC Edmonton Task Force recommendations
- Tech Roundup, Aug. 13: TEC Edmonton Task Force releases recommendations for TEC 2.0
- TEC Edmonton Funding – Business Plan Recommendations from the TEC Edmonton Task Force
- TEC Edmonton Report to the Community, 2018/19
- Global News: Edmonton to have clearer picture of how tech sector is handled by year’s end
- CBC Edmonton: Young, educated and growing: Group coins YEG region brand in bid to attract business