'Anybody who isn't making money is doing something wrong'.

Canadian manufacturing may be taking a competitive beating in the global economy, but so far North Bay appears to be bucking the trend.

A robust mining industry and an ongoing home construction boom, combined with expansions and hires at small and mid-sized companies and on the post-secondary front, has produced a multitude of economic spin-offs in the city.

And expect to see more of the same in the coming year, says Mayor Vic Fedeli.

"Talk to any commercial operator in the city and they'll say anybody who's not making money is doing something wrong," says Fedeli. "The population is increasing, demand is increasing for goods and services and our construction industry is just booming. It's all good right now."

Fedeli predicts more expansion for 2006 based on his regular tours of area businesses.

The city has done its part to jump-start the local economy by lowering industrial taxes by 66 per cent over three years. The plan now is to drop commercial tax by one per cent in each of the next 20 years.

But Fedeli attributes North Bay's vibrant service industry economy to its crossroads location at two major highways, 11 and 17, as well as the upcoming completion of the Highway 11 four-laning, which he calls a "significant factor in the city moving ahead so successfully."

Companies such as Voyageur Airways are growing, having boosted their workforce from 250 to 300 within the last year including adding more aircraft engineers from other parts of Canada.

Other industries are on the move to bigger digs including Ron's Welding, which has erected a 28,000-square foot building on Exeter Street. G & P Welding purchased the Morbark building and is expanding, while Seymours Windows is building a 20,000-square-foot addition at their Seymour Street shop. Rahn Plastics purchased the closed Midtronics battery manufacturers building on Ferris Drive to boost their capacity. And more expansions for 2006 are on the way.

"There's huge work for machine shops and welders because there's so much expansion in the housing market and commercial construction," says Fedeli.

The addition of more than 70 new staff positions at Nipissing University and Canadore College has resulted in two-thirds of faculty coming from out of town.

"That's 40 homes bought for two institutions," says Fedeli.

Based on two record-setting years in construction and more than 200 new home starts. Fedeli is eager to view the results of the 2006 national census, beyond the city's last population count of 56,000.

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"Our population is expanding while most communities in Northern Ontario are shrinking."

He calls the eventual four-laning of Highway 11 south to Huntsville and the Greater Toronto Area by 2012, a "slow but sure" process. The road widening stands as a huge part of the city's overall marketing plan to attract new investment, businesses and people north to the Gateway City.

It will also be an integral tool in promoting the concept of moving international air cargo through Jack Garland Airport.

He also predicts a future shift in the types of businesses cropping up or relocating North.

Foreign competition and cheap overseas labour in manufacturing, especially from China, has Fedeli thinking about pursuing prospects in the high-tech industry, especially the back-office support sector.

He says North Bay has a distinct advantage with two major fibre optic lines intersecting at the city as well as abundant and cheap serviced property located within a three-hour drive of Toronto.

The city is putting a marketing plan together to chase those types of information technology (IT) businesses, as well as promote the former NORAD underground command bunker at CFB North Bay as a secure data storage centre.

The city has been slow to market the three-storey underground facility, because they don't have a deal with the Department of National Defence (DND).

"One of these days we expect a draft deal to cross our desks and that'll ignite the negotiations, and hopefully they'll move quickly. Once we see what DND has in mind, we'll blow the dust off the market plan for the underground."

Fedeli says 2006 is shaping up to be one of the best years ever for commercial and retail development. The sale of surplus city land has raised some much-needed cash to boost the city's coffers.

He expects more Big Box retail development along the Highway 11-17 interchange near the new Home Depot store and anticipates future commercial projects along McKeown Avenue.

"This is a prospect for us this year."

In September, the city launched a North Bay Property Database on their website, an online tool designed to showcase residential, commercial and industrial property listing for the city, realtors and property owners. Offered free of charge, the service includes photos, description, pricing and contact information.

The sale of vacant city land has translated to about $2 million over the last two years for the city's general reserves. He expects significant sales this year when the city puts all their acquired former CN Rail land on the market. Train trestles throughout the city are being removed and huge chunks of the right-of-way will be sold to adjoining landowners while other parcels should create entire new city blocks for development.

"This will be a really aggressive year for lot sales."

The boost to the city's cash reserves from single digit numbers in 2003 to more than $10 million has resulted in Moody's Investors Service increasing the municipality's credit rating to AA-3, considered a high grade investment area.

"Our borrowing rates have come down and it's affected our budget," says Fedeli.

North Bay's biggest construction project in history is expected to get underway this year.

Fedeli says he was assured by Nipissing MPP Monique Smith that the groundbreaking for the much anticipated, $250-million North Bay Regional Health Centre is set for 2006. The hospital will be paid for under a new provincial Alternative Financing program that brings in private consortia to ensure big-ticket mega-projects are completed on time and under budget.

"I expect them to go to tender in the near future and I expect them to put a shovel in the ground once they see what the hospital will cost under this new plan."

A new $45-million water treatment plant near the existing plant on Trout Lake Road will go to tender this spring with construction starting in April.

www.city.north-bay.on.ca

By IAN ROSS

Northern Ontario Business