Upcoming growth decisions will test Calgary city council as climate, fringe development and housing affordability collide.
At a Monday meeting of the city’s Infrastructure and Planning committee, committee members will be examining a “growth portfolio” that will be used to guide “growth-related investments” in the upcoming four-year budget.
Nineteen new business cases for residential development were included in the most recent biannual city review. Five are being considered for approval because they require no additional capital investments in the 2023 to 2026 budget cycle. Three others could be considered, but raise market absorption, operating cost and servicing questions, the admin report said. The remaining 11 aren’t being recommended at this time.
Critics are already pouncing on the potential approval of fringe growth, and the $531.8 million capital costs associated with them. It should be noted that capital investment will primarily service continued growth in 39 previously approved communities.
These additional eight communities would fit into that four-year capital spend.
The additional communities do come with an initial annual operating cost of roughly $5 million.
Further, it’s the first time the city has included a climate risk statement as a part of these business cases. City admin was blunt in their assessment of adding new communities.
“Accommodating growth in New Communities is the most GHG-intensive way for the city to grow,” the admin attachment read.
“Approval of new communities will lock in generations of high-energy intensity land use and transportation patterns and eliminate large areas of climate-mitigating natural assets that would make it more difficult to achieve The City’s 2050 net zero emissions goal.”
Calgary declared a climate emergency at the end of 2021.
Confluence of factors
Housing affordability and accessibility are also hot button topics – not just in Calgary, but across Canada.
Applying demand, affordability, climate risk and budget pressures make this a challenging situation, said Ward 12 Coun. Evan Spencer.
Three of the business cases that are being considered are in Spencer’s ward. The Ricardo Ranch developments of Seton Ridge, Logan Landing and Nostalgia are in the five up for consideration.
“We’re going to have a lot of tough conversations here over the next stretch,” Spencer said.
“It’s convenient to boil it down into to some degree – affordability on one side and then that kind of long-term resilience of the city on the other side. Both are important.”
Spencer said what’s different about some of the new communities is the economics and their climate friendliness. These communities are built differently than those in years past. Plus, he said there are builders trying to push the net-zero envelope. But it comes at a cost to consumers.
It’s tough to have affordability and climate treatment at the same time, Spencer said.
When asked if Calgary needs these new communities in his ward, Spencer said you simply can’t constrain supply.
“We do need supply and the city knows we need supply,” he said.
Ward 9’s Gian-Carlo Carra, chair of the I&P committee, said the city’s taken a big step in the process of making growth pay for itself. He said when he first started on council there was little specific thought to the economics of suburban growth.
He said the rest of Calgary was subsidizing edge growth.
“We built a city that cost us more and more and more over time,” he said.
The culmination of changes – from a growth cost perspective, climate
Carra said the biggest change Calgarians would see, even with the suburban growth, is the careful attention paid to what’s spent to realize that development. It’s all in the city reports.
It’s been a nine-year push to change the financial conversation on edge growth.
Now, they’re dealing with a climate lens.
Carra said he was happy to see that added as a factor in determining the viability of the considered communities. He recognizes the impact adding more communities has on the environment. The admin report outlines those impacts.
But Carra said it’s not realistic to stop all suburban development.
“We can’t stop the tap and say, ‘don’t come to Calgary,’” he said. It drives up housing costs or sends people to bedroom communities.
“If we did, that would have even greater financial and economic repercussions on us than they currently have. So, it’s a wicked problem.”
Rob Tremblay with Calgary Climate Hub said they don’t have a hard and fast rule against suburban development.
The problem is twofold, however.
Traditionally, fringe growth lacks climate-friendly infrastructure like transit or cycling, and therefore is literally gas powered. Also, today’s homes aren’t being built to net-zero standard. The cost to retrofit many of them is prohibitive.
He pointed out that the city’s climate report indicates that the business case proponents aren’t willing to take the steps necessary to have the developments meet climate goals. That’s partially due to the lack of a city climate strategy and clear rules for climate-friendly homes.
“The tools and kind of the sticks aren’t in place to get these communities built in a way that’s climate compatible,” he said.
Still restricting growth, affordability
Ward 13 Coun. Dan McLean, who has been vocal about his support for suburban growth as a means to keep home costs affordable, said more of these communities should be approved.
The admin report was very clear that should the city approve more than the five initial communities, capital costs for the 2023 to 2026 budget would have to be revised. The climate impact would be immense.
McLean said it comes down to housing affordability.
“The more homes we can build, the demand is high, and the prices need to be kept low,” he said.
McLean said the economics today speak for themselves. The levies that are paid to the city, the way the neighbourhoods are developed, and the future property tax generation make them viable. That’s the system the city’s built.
“We need growth, we need more homes, and we need more taxpayers,” McLean said.
“This accomplishes all of those if we build on all these business cases. So, I’d like to see them all (19) approved.”
City land developer Genesis issued a statement on the matter Friday.
They said greenlighting their two projects (Logan Landing, Lewiston) is a win for supply and affordability in Calgary.
“We are ready to go, the demand is there, and the city desperately needs new supply of the kind of housing these projects offer,” said Arnie Stefaniuk, VP regional planning, in a prepared release.
“The new growth Genesis is building today is scaled to pedestrians and are complete communities where you can live, work and play.
Calgary’s population is projected to grow by 22,000 people annually in the next budget cycle – 88,000 total. The city report said this means 44,000 single, semi-detached and multi-family homes are needed.
Coun. Carra knows the potential approval of these cases will ruffle the feathers of many. He’s wary of the climate trouble ahead, along with home affordability.
Change takes time, he said.
“It’s just a big ship that needs to turn and the good news is that we’re turning that ship,” he said.
“And the question at hand is whether we’re going to get that ship turned around or whether we’re going to crash into the rocks on the side of the strait.”