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Ward 7 News: Debt, Growth, and Budgets – looking for a better way

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Ward 7 official website
 
Calgary remains one of the fastest growing cities in North America.  Every five years, Calgary adds roughly the population of the City of Regina to its borders.  During my time in office, from 2001 to today, our population has grown by 36%, with over 100% of growth occurring on the edges of the city as older communities hollowed out, causing pressure on both our capital and operating budgets to service these new areas.
 
With the city’s four-year budget deliberations quickly approaching, City Council will once again consider how to fund rapidly increasing demands for infrastructure and services with limited funding.  Although a thorough debate on priorities is planned, the lion’s share of our budget choices will continue to be shaped by past and future decisions on how we grow as a city. 

Debt Servicing Limit
A booming city poses a number of dilemmas. Growth is costly. Calgary’s debt is directly related to growth, with 75% of our infrastructure investment going to support new development. Earlier this year, Council debated on whether we should raise Calgary’s self-imposed debt limit to facilitate more growth. I was strongly opposed to this for three reasons:  Calgary has the highest debt-per-capita ratio of any city in Canada; it would enable new development in areas that are not ready, forcing us into further debt; capital investment requires additional operating and maintenance dollars. Thankfully, most of Council agreed with my position and took the advice of our Chief Financial Officer and chose not to raise the debt limit, but the question of how to pay for all our new residents’ needs continues.
Most new operating costs also go to accommodate growth, and yet the city needs to approve new communities to house all of our newcomers.  In the past, Calgary chose to build outwards, ever-expanding the city limits with low-density neighbourhoods. Low-density residential communities never pay for themselves, so this growth pattern came with a significant cost that will continue long into the future. 
 
So that’s the bad news. But if the status quo isn’t working, what is the alternative?  The good news is that a lot of work is already underway.  I have been sounding the alarm on growth and debt for many years, and our new City Manager, Jeff Fielding, also recognizes the urgency of our growth, debt, and budget challenges.  In next month’s article I will talk about how the City, working with the development industry, is seeking a sustainable model that will balance the demands of a growing city. 
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This content represents the personal views and opinions of the Ward Councillor and should not be taken as a statement of policy of The City of Calgary. The inclusion of any external content does not imply endorsement by The City of Calgary.
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