Horse Hill ASP: More proof that Edmonton is addicted to sprawl

The proposed Horse Hill Area Structure Plan (ASP) will be debated at a special public hearing on Monday and Tuesday. Known as bylaw 16353, the Horse Hill ASP outlines a development framework for the area east of the Edmonton Energy & Technology Park (EETP). It encompasses roughly 2,806 hectares of land and barely meets the density target of the Capital Region Growth Plan with a proposed density of 31 units per net residential hectare based on a proposed population of about 71,000 people. Proponents would like to see the area developed over the next 30-40 years.

 
Horse Hill ASP, click for a larger version

There are many people opposed to the plan, including over 2100 who have signed an online petition asking Council to “get full information about the true costs and benefits of this current plan and alternative development scenarios”. Some are concerned with the loss of agricultural land, and others are concerned with the unsustainable sprawl of our city. I expect we’ll hear a lot from those perspectives during the public hearing. I wrote about this battle last July and I would encourage you to read or re-read that post for background.

After the public hearing has completed, the bylaw will be ready for first and second reading. Third reading will take place after the Capital Region Board has given its approval of the plan. It’s important to remember where we are in the larger process:

An ASP is a relatively high-level document. It contains more detail than the Municipal Development Plan, but less than the Neighbourhood Structure Plans (NSP). The Horse Hill ASP proposes five neighbourhoods, each of which would require an NSP.

The Horse Hill ASP falls into the Northeast Urban Growth Area, one of three identified in the Municipal Development Plan. Preparation of ASPs for these areas was authorized along with the MDP, but approval was dependent on Council accepting the Growth Coordination Strategy (GCS), the Integrated Infrastructure Management Plan (IIMP), and the City-Wide Food and Agriculture Strategy. Technically all three documents were approved in 2012, but they were not received without criticism. I wrote about some of my concerns with the documents here, here, and here. Furthermore, it’s hard to swallow that the Horse Hill ASP has been developed in adherence with those plans, considering that the Growth Coordination Committee and the Annual Growth Monitoring Report do not yet exist. Both were identified as key methods by which the GCS would be implemented.

At 135 pages, the bylaw, application, and supporting documentation for the Horse Hill ASP contains lots of information (PDF, 15.8 MB). I have slowly been digesting it, and I was particularly interested in the IIMP document that was included as attachment 2c (on pages 113-135). This is the first time such a document has been prepared for Council’s consideration.

From the background section of the IIMP:

The challenges facing the City are to balance development costs with the strategic benefits of sustainable growth, to achieve an appropriate balance of residential to commercial/industrial development. Although the City of Edmonton has achieved some success in diversifying its revenue base, property tax remains the largest component of City revenue.

The IIMP estimates that roughly $2.5 billion worth of infrastructure will need to be built, with developers contributing 66% and the City contributing 34%. The GCS reminds us however that “the City assumes ownership of developer funded infrastructure, generally two years after construction, and is responsible for ongoing maintenance, periodic rehabilitation, and eventual replacement.”

To estimate revenue and expenditures, the IIMP considers two scenarios. The first uses demographic projections from 2008 and assumes that only 52% of the population is achieved within 50 years. The second uses demographic projections from 2012 and assumes that the full population is achieved within 35 years.

Here’s the revenue vs. expenditures for the first scenario:

Here’s the revenue vs. expenditures for the second scenario:

The first takeaway is that new neighbourhoods do not pay for themselves, even (and especially) in the long-run. The IIMP notes that in comparison those charts “seem to contradict the general theory that a faster build-out time would result in a better cost recovery ratio.” It goes on to attribute this paradox to “the timing of certain large capital assets.”

What follows those two charts is a discussion about the balance of residential and non-residential land throughout the city. The IIMP notes that non-residential assessment makes up approximately 25% of the total tax base of the City.

How does the proposed development affect this balance? Generally, residential neighbourhoods have less than 25% of their assessment base as non-residential, and the proposed Horse Hill Area Structure Plan is projected to have 4.3% of its assessment as non-residential. So as the City grows this and other residential areas, it must also grow its non-residential areas to maintain balanced growth.

Incredibly, the IIMP then provides updated versions of the two charts above that “illustrate the importance of balanced growth and the benefit of maintaining the current non-residential assessment ratio.” The estimated revenue is combined with “off-site commercial assessment” to paint a much rosier picture of how we can afford to build out the plan as proposed.

Here’s the updated chart for the first scenario:

And here’s the updated chart for the second scenario:

The IIMP states:

The premise in these figures is that if the City maintains its current balance of 25% non-residential assessment, by developing commercial areas throughout the City, this additional revenue helps to offset the fiscal imbalance indicated by looking at the Horse Hill ASP by itself.

So we need to continue building commercial areas like the EETP to prevent residential taxes from going up dramatically. But to support those commercial areas we need to build new residential areas like the one proposed by the Horse Hill ASP. But to pay for those new residential neighbourhoods, we need to construct still more commercial areas. It’s a vicious cycle.

In other words, we’re addicted to sprawl.

The worst part is that we know this and yet we continually fail to do anything about it. From the MDP:

The Municipal Development Plan proposes a new direction for growth and it will take time to effect change. The Plan is a long term strategy and will require incremental decisions that support our commitment to saying “yes” to the things we want and need and “no” to the things that do not advance our City Vision and goals.

So far we’ve said “yes” to eight NSPs that were supposed to wait for the GCS and other documents, “yes” to a dramatically scaled back Growth Coordination Strategy, “yes” to a Food & Agriculture Strategy that lacks teeth, and we’ll likely say “yes” to the Horse Hill ASP.

We’re addicted to sprawl and we just can’t seem to say “no”.

  • Think Bigger Picture

    Can you really prevent sprawl by saying no to the ASP? If Edmonton is not willing to provide housing in the suburbs, then the surrounding counties will. And the counties will likely have even looser density targets (if any at all). So sure, if you look at a map of Edmonton, the sprawl would be lessened. But if you look at a map including the surrounding area, the sprawl would be ten times worse.

    Rather the opposite, an ASP controls the sprawl. There are at least two areas in the Northeast developed in the last 10 years that are nowhere near the density requirements. How did these developments get approved? I suspect mainly because the City did not have an ASP (city bylaw) to draw from when they resisted.

    • Tom Young

      The Capital Region Board Growth Plan identifies density targets for all regional municipalities, including Edmonton. These growth targets are slightly lower for surrounding municipalities than for Edmonton, but not significantly (a minimum of 25 units per hectare in most areas abutting City limits, versus 30 units per hectare within City boundaries. So, the difference between development within City limits and without is not worlds apart, given that the Horse Hill ASP is clocking in at an estimated 31 units per hectare, fairly close to the Region’s minimum density target for Edmonton.

  • Econ101

    I wonder if the off site commercial revenue included in the IIMP graphs is net of infrastructure costs in these off site areas, or is the City double ( or more times) counting the benefits off site commerce areas.

  • Camron Bute

    People wouldn’t buy and build if there was no demand. Reducing sprawl could take decades, seeing as it took decades to get this way. Once the downtown core, for example, becomes good enough to live in, people will move there. Right now, though, it’s not even close. Until then, we need to keep population growing or we will stagnate.

  • P

    This issue needs to be discussed at the regional level unfortunately. Even if we prevent urban expansion within the City of Edmonton, other counties will take advantage of this. I encourage the public and government to discuss the concept of an agriculture reserve surrounding the region wide enough to ensure that development does not leapfrog. This policy would also help trigger infill development.

  • http://www.facebook.com/chris.martyniuk Chris M

    I’m sure this made its rounds a year or two ago, but it’s worth remembering: top recommendation “A stop to infrastructure projects that expand a community’s long-term maintenance obligations.”

    http://www.theatlanticcities.com/jobs-and-economy/2011/10/suburban-sprawl-ponzi-scheme/242/

    The Ponzi scheme revealed – How new development is used to pay for old development.

    http://www.strongtowns.org/journal/2011/6/15/the-growth-ponzi-scheme-part-3.html

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  • Dave Colburn

    We can say no but we need a Mayor and a Council that are capable of thinking beyond the box dictated by developers who clearly have a majority of this Council in their back pockets. If sprawl is to be addressed it must entail wholesale change of political representation in this next election.