City of Edmonton staff proposes modest $7.75B capital budget for 2023-2026

Click to play video: 'City of Edmonton administration unveils $7.75 billion 2023-2026 capital budget'
City of Edmonton administration unveils $7.75 billion 2023-2026 capital budget
A first look at Edmonton’s proposed 2023-2026 capital budget was released Thursday. Morgan Black reports – Oct 20, 2022

Looking after what’s already in place instead of spending on a lot of new work is the focus of the City of Edmonton’s plan for advancing construction projects over the next four years and beyond.

On Thursday, city administration released the proposed $7.7-billion 2023-2026 capital budget, which marks the start of this fall’s budgetary review process. It is one of four budgets council will consider.

The city said the proposed budget took more than a year to develop and is about tough choices.

“Just as it’s not exactly fun to fix your home’s grading, not every infrastructure investment is going to be exciting or obvious,” said Stacey Padbury, chief financial officer and deputy city manager of finance and corporate services.

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The city said there is relatively little funding for new growth projects.

“We are proposing that $1.1 billion be used for projects that have high safety impacts or are mandated by legislation, like safe crossings in communities,” said Adam Laughlin, deputy city manager of integrated infrastructure services.

The budget includes $4.4 billion in already-approved construction projects like the Blatchford airport-to-residential neighbourhood development, expanding the LRT, the Lewis Farms and Coronation Park recreation centres, and the Yellowhead Trail freeway conversion.

The budget also proposes $3.3 billion in new capital projects and a focus on renewing existing city infrastructure. It’s not exciting work, but Padbury said it’s necessary.

“While renewal isn’t always obvious, not renewing over time becomes more obvious to residents who use the assets.”

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The city said more than $2.2 billion is earmarked to help maintain existing infrastructure, such as rehabilitating the High Level Bridge and William Hawrelak Park.

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“There’s still a significant investment in growth to support a growing city and transformational investment, but taking care of your assets is as important to ensure we’re not getting into a larger infrastructure deficit,” said Laughlin.

The utilities at Hawrelak Park are more than 50 years old and major work is needed to upgrade things like sewers, water distribution, the irrigation network and power lines.

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One of Edmonton’s most iconic and historic structures, the High Level Bridge, was constructed by the Canadian Pacific Railway Company between 1910 and 1913, and ownership was transferred to the city in 1994.

Laughlin said the High Level Bridge work would happen towards the end of the four-year budget cycle.

“That one is a significant investment based on the scale of the structure and the type of structure that it is,” he said of the more than 100-year-old bridge that last went under major work in 1995.

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City administration is also recommending beginning to replacing the original LRT fleet, which it says is over 40 years old.

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“Like all Edmontonians, the city is dealing with economic uncertainty and inflation, and this capital proposal responds to these challenges with a focus on what’s most important: renewing existing infrastructure and advancing new projects that are critical to the city’s growth,” Padbury said.

Padbury said the budget is based on funding from the federal and provincial governments and is lower than what was expected in past years.

“Our allocations under programs like the Municipal Sustainability Initiative (MSI) are lower than they were four years ago, in part because of the economic environment that both the city was in and the province was in at the time,” she explained.

The MSI provincial funding source, launched in 2007, is ending next year and the province said it will be replaced with the Local Government Fiscal Framework (LGFF) beginning in 2024.

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The proposed capital budget will be presented to Council on October 31.

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It is one of four proposed budgets — capital, operating and two utility budgets — that city council will consider this fall.

The operating budget is being released on Nov. 14. Each will be presented to council over the next several weeks, followed by a public hearing on Nov. 28 and 29.

City staff already presented a bleak financial picture in council chambers, saying it is short billions of dollars needed for necessary infrastructure fixes and suggested money be shifted away from neighbourhood renewal projects to make up the deficits.

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“We bring a budget with our best advice and they can adjust that with what they think is within the best interest for Edmontonians,” Padbury said.

Started in 2009, the program uses $158 million of taxpayer funding each year to improve neighbourhoods by repaving roads, and adding or renewing street lights, sidewalks, bike lanes, road crossings, trails, benches and other amenities.

So far, 186 neighbourhoods have benefited with 35 others slated to be part of the program between 2023 and 2026.

City administration has proposed taking either 25 per cent or 35 per cent of the neighbourhood renewal funding between 2023 and 2026 to use towards the necessary infrastructure projects.

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A 25-per-cent reduction would free up $151 million over four years for the facilities, bridges and transit projects.

However, 15 neighbourhoods would have to wait longer for improvements, pushing the neighbourhood renewal program back about six years.

At a 35-per-cent reduction, $212 million would be available for the infrastructure improvements. City-wide, 18 neighbourhood renewal projects would be delayed, pushing back the program targets by 10 years.

Administration has not said which neighbourhoods would be affected, but estimates the areas would have to wait one to two years longer for their construction.

Council could choose to amend things and within reason, cash could be re-allocated.

Council will adjust and finalize the budget in December.


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