Edmonton’s downtown revitalization: now linked to the arena more than ever?

Back in May, the City of Edmonton and the Katz Group agreed on an agreement framework. A month later, City Council asked a number of questions about that agreement, which Administration answered in a report (PDF) that went back to Council on July 20, just before the summer break. Unsurprisingly, a few of those questions were related to the Community Revitalization Levy (CRL). The answer was that Administration would return to Council with more information, including the new CRL boundary, with a target date of August 31.

Today, that date became official, not to mention a whole lot more complicated. Here’s what a media advisory titled “Proposed Downtown CRL could fund revitalization” said:

A vibrant downtown is a key ingredient of a great city. Gary Klassen, General Manager for Sustainable Development, will be available to speak about a report on an option for a boundary for a downtown Community Revitalization Levy which could fund revitalization.

That media conference will take place tomorrow at noon (right in the middle of the I (heart) yegdt BBQ taking place right outside City Hall in Churchill Square). The report itself will be made available at 11am.

The gist of it is this: the City is proposing a larger, downtown-wide CRL to fund not only the arena but also a number of other “catalyst” projects in the downtown (as outlined in the Capital City Downtown Plan). I can’t confirm this just yet, but my understanding is that the proposed CRL is big – as in $320 million big. It’s a smart piece of political maneuvering, when you think about it. How do you get councillors who are opposed to or on the fence about a CRL for the arena to support one? Add in a whole bunch of other stuff they would likely support. It’ll be especially interesting because with the summer break a number of the councillors have no idea this is coming.

I think there are two ways to look at this proposal.

One perspective is that the proposed CRL is a good thing because the catalyst projects will finally receive funding. Projects like the Jasper Avenue New Vision, At-Grade LRT, the High Profile Bikeway System, and the Warehouse Campus Central Park all sound great, but don’t have any funding attached to them. The proposed CRL could be used to fund all of these in addition to the arena. Some projects would certainly benefit as they’d sort of “catch a ride with the arena” and would get their funding without too much added trouble. And since they are all part of the plan to revitalize downtown, the CRL is a good fit. That’s what it was intended for, after all.

The other perspective is that the proposed CRL is a bad thing because it basically holds downtown revitalization hostage. You could see the proposed CRL as a message that either Council agrees to fund the arena, or the other projects don’t receive funding. The 2012-2014 Capital Budget is coming up for discussion later this year, and some of these projects (or elements of them) would have been part of the budget discussions. Now it seems they would just come along with the arena, or….what? It’s not clear what the alternative might be. Additionally, projects funded through the CRL might not actually receive any money for years (a CRL takes time to approve), whereas if they were funded through the budget process they could receive funding as early as January.

Take the Alley of Light project, for instance. It was slated to be up for discussion as part of the Capital Budget, with a line item of $500,000. Now it would fall under the Green & Walkable Downtown catalyst project. In a way this is a good thing – the Alley of Light might receive the funding under the CRL without too much debate. On the other hand, don’t we want Council to be clear about what they’re funding? I want Council to stand up for the Alley of Light, to say that it is absolutely worth the $500,000, and that it will have a positive impact on our downtown. I don’t want it to get funded “under the radar” just because the arena did. Likewise I don’t want the arena to get funded just because we want the other projects.

Not to mention that the proposed CRL is especially risky given that The Quarters CRL is immediately to the east. How likely is it that the required development will take place in both areas to generate enough tax “lift” for the CRL to work?

Ever since the beginning, the Katz Group has made it clear that this project is about downtown revitalization. To them, downtown revitalization doesn’t really happen unless the arena happens. Now with the proposal of a downtown-wide CRL, it seems that the City has bought into that idea wholeheartedly. Next Wednesday, we’ll find out if City Council has as well.

UPDATE: The report is now available. Details: “over the 20 year term of the levy is expected to generate an additional $1.18 billion in new tax dollars (net present value of $600 million) of which $788 million is based on appreciation of the existing assessment base (net present value of $385 million).”