How B.C.'s small businesses could be champions for $15 minimum wage
A 2016 report from the Institute for Local Self Reliance delves into a range of policy responses American cities are undertaking to combat this trend. Olivia LaVecchia, the author of that report presented on this at the Hopeful Economics Summit hosted by the City of Vancouver and Simon Fraser University Community Economic Development Program earlier this year.
The newly elected B.C. provincial government is committed to gradually increasing minimum wage in phases, but the reality facing many businesses in Vancouver is that year after year they have been faced with dramatic shocks to their bottom line that are far more disruptive and debilitating than a phased-in wage increase.
The mediocre property you are in tripling overnight in value is not something that many have included in their business plan. But that is the reality for far too many. Even high-profile destination restaurants like Italian Kitchen in the heart of Vancouver’s central business district are not immune from the shock of what could rightfully be termed assessment led displacement.
Public Interest in a Globalized Real Estate Market
When the BC Assessment Authority was created in the 1970s to act as a fair and neutral arbiter of property values here it was a different world. When one points to BC Assessment’s role in the small business affordability crisis an argument is often levied back that it’s working exactly as it was intended to. It is a neutral and fair arbiter of market value. BC Assessment keeps on assessing properties at what it thinks they are worth, and people, or corporations, or governments, keep on buying them at those values. Conversation over.
I believe the context in which bodies like assessment authorities were created no longer exists. Back then property values in entire neighbourhood serving commercial areas weren’t rising by 40% year over year.
I have every confidence that the leadership and staff at BC Assessment do their work with integrity and professionalism, and a criticism of the role of the assessment process in financially straining small businesses is not meant to be a criticism of them specifically. I too work for a public institution, and my colleagues and I take seriously how our work serves the public interest, just as I expect those at BC Assessment do.
However, over the past few years a sad parade of cherished neighbourhood institutions have closed their doors in big city neighbourhoods causing residents and businesses to mobilize in response. The recent book, Vanishing New York: How a Great City Lost its Soul explores New York’s situation in detail.
Here in Vancouver businesses that have been open for decades, the Dover Arms, Three Vets, The Foundation, Chinatown Market and numerous other small businesses in Chinatown, have similarly shuttered their doors.
Today, bodies like assessment authorities may indeed be fair arbiters of global flows of capital, but when it comes down to it many believe we are not seeing fair outcomes in our communities, whether our community is in Vancouver, New York, Austin or San Francisco. So how can we best serve the public interest in this new context? It's the question being asked in cities across North America.
Here in BC municipalities have raised concerns about how assessments are creating "hot-spots" that displace and strain local businesses for years. I hope this new government will take seriously those concerns. Large municipalities like Vancouver have asked the Province in the recent past to apply a split-assessment methodology so that businesses aren’t paying for the value of actual or speculative residential units they share a site with, but the mania is no longer simply contained to mixed-use real estate.