A consortium of Calgary developers is seeking city council’s approval to build 11 new communities on the outer edges of the city — a request that has one councillor sounding the alarm.
Ward 7 councillor Druh Farrell said she is concerned with the proposals from several of the city’s development firms, which is expected to go before the city’s Priorities and Finance Committee on Monday.
Meanwhile, several councillors have confirmed to Global News that city administration is recommending council approve none of the new neighbourhoods due to an oversupply on the market and a lack of demand.
“We’ve got policies on managing growth, and it’s really to match that market demand with the supply, and limiting the risk to Calgarians — to the taxpayer,” Farrell said.
“It throws the strategy completely out the window if we ignore it.”
The proposed communities comes two years after city council approved 14 other new neighbourhoods, despite administration recommending at the time that council only approve eight.
The Ward 7 representative and Mayor Naheed Nenshi were the only opposing votes in council chambers at the time.
According to Farrell, there are 41 new and developing communities in the city due to that decision.
She said the new neighbourhoods contributed to property tax increase of 0.75 per cent in 2019 and increases of 0.5 per cent per year to water utility rates between 2019 and 2022.
Farrell said there is $500 million in funding from the city committed to new community growth through 2022, and the 2019 budget took a hit of $57 million due to oversupply.
City council is seeking a tax freeze for 2021. According to Farrell, taking on additional costs to subsidize new communities while trying to cover budget shortfalls from slower levy payments could result in massive service cuts.
“If we oversupply the market, then we’ll have to cut services to all of Calgary — the existing Calgary, for communities that aren’t yet built,” Farrell said. “I would say it’s an unreasonable risk to have taxpayers cover these costs.”
The Calgary Firefighters’ Association has also expressed reservations about adding more neighbourhoods.
According to union spokesperson Matt Osborne, the fire department budget has been cut by $30 million over the last several years, including the reduction of five fire trucks in 2019.
“The city is getting bigger, and our budget has gotten smaller, and we’re at the breaking point,” Osborne said.
Developer Trico is bringing forward a business case to council to develop two parcels of land as part of their ongoing development Belvedere. The company said more options within Calgary will ease losses on the market to bedroom communities adjacent to the city.
“Trico is very committed to the east side of Calgary. We feel this area has been overlooked in the past with no real supply of new homes,” Trico marketing vice president Wanda Palmer said in a statement to Global News.
“We believe providing more choices within Calgary’s east sector will help mitigate market loss to smaller satellite communities.”
Monday’s debate on the matter shouldn’t become a suburban versus urban development discussion, but rather a conversation about managing growth and expectations, according to Ward 6 city councillor Jeff Davison.
Davison said the decision for these new neighbourhoods will ultimately come down to how much capital is required from the municipality.
“If we’re looking at these business cases and there’s no operational expense for the City of Calgary in the short term, then we could move forward with that to ensure that business stays in the city,” Davison said.
“The cases that require investment from the City of Calgary — that’s where we’re going to have to ask the question to ourselves to say, ‘is this the right time to be doing this and are we better off placing that investment in other areas over the short term?'”
Ward 9 councillor Gian-Carlo Carra said that he would be supporting administration’s recommendation of no approvals at Monday’s meeting.
As to why the developers are coming forward with these proposals, Carra said the decision would add more value to the land.
“They’re trying to be able to go to the banks and say, ‘Look, we’re approved for growth, so our land is worth that much more, so we can keep the lights on and feed the mouths that we need to feed as an industry,'” he said. “But we have to balance that as the public purse with all the mouths that we have to feed across the city.”
Mayor Naheed Nenshi said the city can’t remove risk developers take on when buying land.
“Just because somebody bought land 10 or 15 or 20 years ago does not mean they have the right to develop on it until the city is ready to make that development happen,” Nenshi said Thursday.
Nenshi also said the last tranche of communities approved should have been spaced out better, especially with the current oversupply of housing in the market.
“We shouldn’t have approved the 14 that we approved two years ago — we should have approved eight or nine,” the mayor said. “The remainder should have been approved this time.
“But since we already blew the bank and approved five or 10 years’ worth of new communities, it’s going to be very hard to convince me that we should be adding more to that list in this economy and in this growth environment where fewer people are moving to Calgary.”
According to the city’s Municipal Development Plan (MDP), growth should be balanced 50-50 between new development and redevelopment in existing communities over the next 60 years.
Jenna Dutton, urban policy platform research coordinator at the University of Calgary School of Public Policy, said approving new communities shifts priorities from those long-term plans.
“You’re taking away from the strategic development of the inner city, and established communities,” Dutton said. “In doing that, you’re reducing development opportunities and strategic growth that are closer to transit; so then you’re having more emphasis on automobile use, more impact on infrastructure.”
The matter will be discussed at the city’s Priorities and Finance Committee on Monday — a meeting which is open for public comments.
–with files from Adam Toy