Ottawa city staff have made the case for handing over management of the ByWard and Parkdale markets to a new not-for-profit corporation on Jan. 1, 2018.

In a report to be tabled at next week's finance and economic development committee, city staff recommend passing off day-to-day operations of both markets to a newly formed municipal services corporation.

The report says revenues at the two markets have been declining and both have struggled to attract new vendors, with the ByWard Market increasingly being taken over by restaurants and bars.

"In recent years, the two markets have simultaneously experienced the challenges of attracting local producers, losing retiring vendors, and competing with the City's flourishing farmers market movement," the report notes.

Deficits expected in 2018, 2019

The report found that under current management, the markets would continue to lose money and eventually have an estimated deficit of $110,000 in 2020.

Under the city's estimates, the municipal services corporation would run deficits in 2018 and 2019 before turning a small surplus of $15,000 in 2020, which it could then reinvest in the markets.

In December the city's auditor general found the city managers in charge of the Parkdale and ByWard markets were not following their own business cases to promote the markets at a time when sales are declining. In response to the auditor, the report also expands on a mission statement created last May and further outlines objectives, a mandate and the guiding principles of growth, collaboration, diversity, sustainability, innovation and transparency.

The corporation would be responsible for the outdoor vending operations at both ByWard and Parkdale Markets, as well as for the 25 indoor tenancies at 55 ByWard Market Square and the seven tenancies located in the parking garage at 70 Clarence St.

While the city would own the properties, management would become a shared responsibility.

Henri Groulx, president of the Byward Market Stand Association, says he's ok with handing over management of the market to a not-for-profit corporation, but worries what that will mean for certain vendors and farmers whose livelyhood depends on selling at the market. (Giacomo Panico/CBC)

Board would report to council

The report also asks the city's planning committee to approve the process for recruiting and selecting board members for the corporation, while delegating authority to Mayor Jim Watson and Coun. Mathieu Fleury and Coun. Jeff Leiper to appoint the initial three board members.

The ByWard Market is in Fleury's Rideau-Vanier ward, while the Parkdale Market is in Leiper's Kitchissippi ward.

The corporation's board of directors would be required to submit a formal report to city council annually.

The city's finance committee will review the report and its recommendations when they meet on April 4.

'We've got too many restrictions now'

Initial reaction to the proposal was mostly positive, with a dose of cautiousness from vendors setting up Wednesday morning at the corner of George St and ByWard Market Square.

Henri Groulx, president of the Byward Market Stand Association, said he's generally OK with handing over management of the ByWard Market to a not-for-profit.

"The challenge is that we don't know what's going to happen 2018," said Groulx. "It's pretty scary for some of these people that have been here for 20 to 25 years. A lot of them do this for a living, and they don't know if they'll actually even be here in a couple of years, because they haven't told us what's going to happen when they do deregulate."

As it stands, management of both markets falls under the direction of the city's branch of By-law and Regulatory Services.

Denis Giroux, who's been a vendor at the ByWard Market for the past 42 years, said Wednesday he's in favour of the proposal.

"As long they let us sell like we used to," said Giroux. "We've got too many restrictions now."

As an example, Giroux points to his table of maple syrup products. Strict regulations mean he can only sell goods in which maple syrup makes up at least 51% of the product.

Denis Giroux has been a vendor at the ByWard Market for 42 years. He says under city management, the market's rules have become too restrictive. (Giacomo Panico/CBC) The rule is meant to avoid competition among vendors and traditional storefronts.

'We're here, finally, after many years'

The two city councillors whose wards encompass the ByWard and Parkdale markets said Wednesday they fully support the city staff recommendation.

Fleury said he agrees with taking management of the markets out of the hands of city managers.

"It's very restrictive and not entrepreneurial," said Fleury. "There's been a lack of ability to be unique."

Fleury said the shift to a not-for-profit comes after many discussions involving vendors and consultants.

"We're here, finally, after many years," said Fleury.

Leiper, meanwhile, said he's hoping the Parkdale Market can take a page from what's been happening in the private sector.

"The new farmers markets that have been spreading up around town have been giving our Parkdale and ByWard markets a real run for their money," said Leiper. "By blowing up the regulations around how we run the markets, I think that puts our markets in a good position to compete."​​