Calgary election: construction industry gets a look at top 3 mayoral hopefuls

Calgary councillors Jyoti Gondek, Jeff Davison (L to R, top row), Jeromy Farkas and moderator Lori Williams (L to R, bottom row), participate in a mayoral roundtable, hosted by Calgary's construction associations on Oct. 12, 2021. Global News

Members of Calgary’s construction industry heard from the three top-polling mayoral candidates on Tuesday and about their vision for building the city.

The Calgary Construction Association, which includes commercial developers, residential building association BILD Calgary, commercial real estate development association NAIOP and Crew Calgary, a networking organization for women in commercial real estate, co-hosted the online roundtable with councillors Jeff Davison, Jeromy Farkas and Jyoti Gondek.

CCA president and COO Bill Black said the candidates’ perspectives showed their experience with construction projects beyond voting for them on council.

“The variety is quite interesting because these are city-building conversations, and I think we heard slightly different perspectives from all three that will really inform the way our members think on voting day,” he said.

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The host organizations selected questions that were asked by moderator Lori Williams, with topics including collaborative leadership and advocacy, transparency and accountability, working with industry to build up the city and formatting large projects allowing for local bids.

Farkas accuses administration of ‘skimming’

While outlining his pledge to reduce in-camera meetings in an effort to improve transparency, Farkas said the city had been “skimming” money from off-site levies — amounts paid by developers to the city to offset capital costs of infrastructure like roads and utilities.

“Because of that secrecy, city hall establishment — the administration — including the planning departments that Councillor Gondek is chair of the committee for, basically got away with skimming money off the top: millions and millions of dollars that industry have paid into these fees and reallocating that interest income into other priorities without actually showing industry the receipts,” Farkas said.

In late 2020, city administration found an accounting error of the levies. The city then repaid more than $56 million in accrued investment income from general revenue into the developer-related accounts.

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Gondek disagreed with the characterization of “skimming.”

“If that’s the way you’re going to go into a relationship as the mayor of the city with your administration, I struggle to see how we will ever accomplish anything,” she said.

Davison demanded an apology from Farkas, one that didn’t come during the debate.

“The argument of they were skimming off the top has criminal implications, and I believe none of that was happening, and he owes them an apology,” Davison said.

Getting industry input

Asked about how the city can partner with industry experts to work on issues like climate change, Gondek pointed to examples including her pre-council work with the Haskayne School of Business connecting MBA students with experts, allowing them to work on efforts like the city’s real estate working group and the financial task force.

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“There are all kinds of ways that we can create better, engaging with associations and professionals in the private sector to strengthen our government, and we have seen evidence of how well those things work,” she said.

Conference Board of Canada data showed the construction industry is the fifth-largest in the city, representing 5.5 per cent of city GDP in 2020. The finance, insurance and real estate sector is second-largest at 20 per cent of GDP.

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Davison said the construction industry needs certainty of projects that council has already approved, whether or not they voted for or against the projects.

“Councillor Farkas has told the rooms of individuals the event centre will die on Day 1 if he is elected.,” Davison said.

“No, that’s…” Farkas interjected during Davison’s time.

“You have gone before Willow Park,” Davison retorted. “I had a friend there. He heard you say it himself.”

Davison said the projects he had been a strong proponent for — the BMO Centre expansion, the Arts Commons transformation, and the events centre — have all been structured in a way that limits risk to the city.

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“It’s possible to make our money work for us, and it’s not a situation of this or that, it’s this and that,” he said. “That’s how we’re going to be able to stand up Calgary’s downtown. That’s how we’re going to recover our economy.”

Farkas said he was committed to seeing projects committed to by city council through to completion.

“I may not have agreed with doing every single thing simultaneously, given the advice of our city CFO was to basically only bite off what we could chew,” Farkas said.

”But given that council has agreed to these things, the contracts are in place. It’s the job of the mayor and it’s the job of the council to see that through.”

But Farkas offered little beyond having a good relationship with the province to try to get the Green Line procurement structure back to the multi-phase one originally approved by council.

Phase 1 was to be built from Shepard to Ramsay, Phase 2A was to go through downtown to Eau Claire, and Phase 2B from Eau Claire to 16 Avenue N.

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The provincial government’s approval was contingent on the megaproject to be split into one phase from Shepard to Eau Claire and another north of the Bow River.

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Davison said he would “fight to get that (previous phasing) back.” Both he and Gondek pointed to collaborating with other councillors to draft 17 recommendations that would mitigate risk while maximizing opportunity.

“The reason we proposed the Green Line the way we did is to keep as much business for the construction sector in Calgary as possible,” she said

The size of that has edged out many local general contractors from bidding.

“If the project gets broken up along the lines the city was going prior to the province interference, there was an opportunity for a local (general contractor) to compete,” Black told Global News.

He said a company with no ties to Calgary will likely come in and win the contract because of their size.

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“What we’re worried about is if a project like (the Green Line) goes really badly off the rails — no pun intended — you can see some potential massive overruns that could bankrupt the city,” Black said.

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“You could also see a terrible fallout on trade contractors, suppliers and others that maybe don’t get paid the full value of the work they did.”

It was a concern echoed by Gondek and Davison.

Black was impressed with the detail and intelligence in the responses from the trip of would-be mayors just days before Calgarians go to the polls.

“I wouldn’t say it’s the easiest choice facing us, but at least we have people with some experience and some passion who are willing to share what they stand for,” he said.

“So however we vote, we’ve got a pretty good idea of what we’re in for.”

Calgarians go to the polls on Oct. 18.

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