Stimulating the Canadian Economy by pfh17972

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									                   Stimulating the Canadian Economy

                          The City of Calgary’s Proposed Recommendations
                                                     for Economic Stimulus




calgary.ca | call 3-1-1                             January 2009
I. INTRODUCTION
            The global economic downturn has         The purpose of this document
            become the focus of governments          is to present the Government of
            across the world. Citizens are           Canada with The City of Calgary’s
            looking to their governments to          recommendations for economic
            respond effectively and creatively       stimulus of the Canadian economy
            to navigate through this period of       through support of:
            economic instability. The Government       • Canada’s energy future and green
            of Canada has announced that the             energy.
            2009/10 federal budget will contain an     • housing for seniors, affordable
            economic stimulus package, including         housing and attainable home
            investments infrastructure and               ownership.
            assistance to strategic sectors of         • municipal infrastructure, with
            the economy.                                 particular emphasis on transit
                                                         investments.
The argument for spending on                than a combined $2 billion tax           It is clear that Canadians want all
infrastructure in times of an economic      reduction. The study also found that     orders of government to work together
slowdown is solid and backed by             this $1 billion would grow the economy   to come up with meaningful and
credible research. Infrastructure           by about 0.13 per cent and create        practical public policy responses to
spending is not only an effective tool to   more than 11,000 jobs.                   the current economic situation. The
counteract recessionary pressures on                                                 City of Calgary firmly believes that
the job market, it also creates long-       Direct investments by government are     the recommendations and projects
term value for our communities and          not the only approach to providing an    outlined in this document would
the national economy. A recent study        economic stimulus. Creative solutions    provide a significant economic stimulus
released by the Federation of Canadian      that provide tax incentives and access   to the Canadian economy, resulting in
Municipalities shows that $1 billion        to capital are useful mechanisms to      the creation of thousand of new jobs
spent upgrading roads, bridges and          spur private sector investment will      and providing long-term stability to the
water mains provides a more tangible        drive economic activity.                 Canadian economy.
and immediate return of investment
II. STRATEGIC INVESTMENTS IN
    THE NATIONAL ECONOMY
INVESTMENTS IN GREEN ENERGY
Canada’s energy industry is a major contributor to the             This support could be achieved through:
national economic output and a significant source of               • tax credits and incentives.
government tax revenue.                                            • capital cost allowance deductions.
                                                                   • government grants (where appropriate).
                                                                   • ensuring the private sector has access to secure capital
  Economic impact of Canada’s
                                                                     at reasonable rates.
  Energy Industry
    • $45 billion trade surplus.
    • 15 per cent of the national exports.                       A CASE STUDY:
    • Annual capital spending of $50 billion.                    THE IMPORTANCE OF OIL SANDS UPGRADER
    • Employment of over half a million Canadians.               PROJECTS TO CANADA
    • $24 billion in Royalties and taxes.                        The Problem
    • Federal tax revenues of $4.3 billion (2007).               The tightening of global credit markets has reduced the
                                                                 private sector’s ability to move forward with planned Oil
                                                                 Sands upgrader projects. The scaling back, restructuring and
The current economic environment has limited many                cancellation of proposed upgrader projects will have a long-
producers’ ability to raise investment capital, hampering the    term dramatic impact on the Canadian economy. There is
financing of ongoing operations and funding requirements for     potential that future oil sands and upgrading could be lost to
major energy projects in Canada. Of notable concern is the       the United States, thereby resulting in a permanent transfer
impact on investment in “greening” technology and national       of wealth outside of Canada.
upgrading and refining projects slated for development.
Particularly in respect to Alberta’s oil sands, the concerns
                                                                 Economic Benefits to Canada
are threefold: (1) immediate job losses; (2) long-term
                                                                 Research shows that one upgrader project provides
sustainability; and (3) long-term environmental opportunities.
                                                                 enormous long-term economic benefits to the Canadian
                                                                 economy.
In order to effectively address these concerns, The City
of Calgary recommends that the Government of Canada                According to the Canadian Energy Research Institute

provides support for:                                              (CERI), one upgrader producing 150,000 barrels per day

  • Canadian petroleum upgrading and refining capacity             would result in:

    with particular emphasis on those utilizing Carbon               • $114.5 billion in economic benefits over 30 years.

    Capture and Storage (CCS) Technology.                            • benefits equivalent to 20 per cent of Canada’s

  • green energy technology, such as wind, solar, hydro,               entire auto industry GDP.
    district energy and other technology to achieve long-            • a contribution of 784,000 person years

    term environmental goals.                                          in employment.
                                                                     • approximately $21.9 billion in tax revenues
                                                                       to governments.
A common misconception is that Oil Sands upgrader             Strategic investments in upgraders utilizing CCS technology
projects only benefit Albertans. However, research            would result in the large-scale generation of cleaner energy
conducted by CERI reveals that all Canadians benefit from     through the removal of greenhouse gases. Investments in
such projects.                                                this green energy technology would contribute significant
                                                              long-term economic benefits to the national economy
Economic Benefit to Canadians                                 through the creation of thousands of good paying jobs.

                 Ontario    Quebec     Alberta     Rest of    They would also result in substantial increases in GDP and

                                                   Canada     household incomes in virtually every province and territory

 GDP             $14.9      $1.4       $91.3       $6.9       across Canada.
 (in billions)
 Person          152,000    20,000     518,000     94,000
 Years of
 Employment



Environmental Benefits to Canada
Oil Sands upgrading and refining, combined with CCS
technology, positions Canada as a world leader in reducing
GHG emissions:
  • Enhanced Oil Recovery (EOR) maximizes
     production from existing operations.
  • Alberta’s geological formations make it one of
     the world’s best places to implement carbon
     management programs.
  • New upgraders containing CCS technology have
     the ability to store up to 40,000 tonnes of carbon per
     day. This is equivalent to the emission produced by
     2.5 million cars.
  • Oil Sands upgraders with CCS technology produces less
     GHGs than conventional “light crude”.
BUILDING AFFORDABLE AND
ATTAINABLE HOUSING FOR CANADIANS
The Calgary Homeless Foundation estimates that 30,000 to          The City of Calgary recommends that the Government of
50,000 affordable housing units are needed across Canada.         Canada provide greater investment in housing through:
In Calgary alone, 3,000 people are on the wait list for Calgary     • tax credits.
Housing Company affordable units, and 58,000 households             • direct financial support for building non-market,
are having a difficult time affording adequate housing.               affordable and seniors housing.
                                                                    • creative use of access to capital to spur near market
According to the 2006 federal census, over 5,000 low-                 attainable home ownership opportunities.
income Calgary seniors are renting and spending greater
than 30 per cent of their gross income on housing costs. Of       The City of Calgary believes that these measures would help
these, over 1,000 low-income Calgary seniors are spending         increase Canada’s supply of affordable housing, reduce the
more than half of their income on housing.                        number of persons who are homeless, and preserve and
                                                                  create thousands of jobs.
Affordability of accommodations is a major challenge facing
Calgarians. As of November 2008, the average price of a           A CASE STUDY:
single-family home in Calgary was $435,471. This means            ATTAINABLE HOME OWNERSHIP IN
that to purchase a home, a prospective buyer would need to        CANADA — A NEW MODEL
have a combined annual family income of $96, 521. In terms        What is Attainable Home Ownership?
of rental accommodations, the average monthly rent for            Attainable home ownership is near-market housing created
two-bedroom units in the Calgary metropolitan area for            for perpetual ownership by individuals and families. Two
2007 was $960. In 2008, that figure rose to $1,089.               factors are critical to this concept:
                                                                  (1) Affordability; in terms of building units at affordable
With market housing starts falling dramatically over the past         prices through provision of public land and most
few months, the current economic downturn has presented               favourable financing rates.
an opportunity to capitalize on the availability of a skilled     (2) Ownership; allowing individuals to generate personal
workforce to begin building more affordable housing options           wealth and progress beyond rental or subsidized rental
for those Canadians in need and prevent further job losses in         into owning equity in housing.
the construction industry. Investments in affordable housing
provide an effective economic stimulus and meet                   No direct financial cost to government other
an important societal need.                                       than providing access to capital and support
                                                                  for the concept.
How Does it Work?
                                                                        Economic Impact in Alberta of Creating
An Attainable Home Ownership Program uses:
                                                                        1,000 Units of Attainable Housing
  • access to capital at government rates of interest.
                                                                           • Total project cost: $240 million (2007 dollars)
  • public lands on perpetual lease.
                                                                           • Cost per unit: $250,000
  • private sector, for-profit, participation in
                                                                           • Increase in GDP: $174 million
    constructing units.
                                                                           • Increase in labour income: $130 million
  • a caveat on title and shared participation in equity
                                                                           • Increase in employment: 1,970 persons
    growth with the owner to maintain affordability.
                                                                           • Increase in gross production: $428 million


What are the Benefits?                                                 The City of Calgary believes the implementation of a
Long-term economic and social benefits include:                        national Attainable Home Ownership Program would provide
  • savings from land and financing costs to ensure                    both short- and long-term benefits to Canadians and the
    affordability.                                                     Canadian economy. Rising vacancy rates, lower borrowing
  • unit owners and not-for-profit trusts share increases in           rates and capacity in the construction industry present a
    equity of units.                                                   critical opportunity in this economic climate to address the
  • builds capacity in the non-market segment of the                   increasing demand for attainable home ownership. Given
    housing continuum for those who need it.                           these conditions, The City of Calgary recommends that the
  • requires no capital funding on behalf of government,               Government of Canada take steps to establish an Attainable
    only access to financing at preferred government                   Home in Ownership Pilot Program in selected cities across
    rates of interest.                                                 Canada, including Calgary.




Affordable Housing Opportunity
Improving home ownership opportunities creates
vacancy in the subsidized housing and rental
spectrum for people on waiting lists.




                                                                                         Attainable home
                                                                                            ownership         1. Public land made available for
                                                                                                                 perpetual home ownership.
                                                                                                                    • Creation of wealth for
                                                               Formal/informal rental       Ownership
                                                                                                                      owners.
                                                                                                                    • Public “equity”
                                                                   Near market                                        recaptured.
                                                                                                                    • Stability in marketplace.
                                        Social or subsidized                                                  2. Funding pool created to
                                              housing                                                            finance mortgages at most
                                                                                                                 favoured borrowing rate.
                                              Rentals                                                         3. Private sector builder to
                                                                                                                 construct units.
                                                                                                              4. Support for new owners
   Emergency             Transitional
                                                                                                                 provided by way of post-
    shelters               housing                                                                               purchase financial literacy
                                                                                                                 and education.
 Waiting list for subsidized housing
III. STRATEGIC INVESTMENTS IN
     MUNICIPAL INFRASTRUCTURE
The Government of Canada has                  Infrastructure Status Report estimates
indicated that its economic stimulus          that The City of Calgary has a $10.4
plan could include “shovel-ready”             billion (over 10 years) infrastructure
infrastructure investments. This section      debt. This means that over the next
provides a profile of key municipal           10 years, The City of Calgary will
infrastructure investments that the           need to invest over $10 billion to
federal government could make to              maintain, upgrade and grow its capital
benefit the citizens of Calgary. They         infrastructure to meet the needs of
have been grouped into key themes:            its citizens.

  • Keeping Canadians Moving
  • Building a Greener Canada                 The City of Calgary offers the following

  • Enhancing the Safety of Canadians         projects for the Government of

  • Providing Arts and Culture to             Canada’s consideration. Each project

    Canadians                                 could begin within the next 3 to 18

  • Creating Healthy Opportunities            months. They have been evaluated on

    for Canadians                             a Triple Bottom Line policy framework,
                                              meaning that they meet economic,
The proposed projects are identified as
                                              environmental and social objectives.
key priorities for the citizens of Calgary,
but have yet to be undertaken due
to the lack of available funding. Our
KEEPING CANADIANS MOVING
Regional Bus Rapid Transit (BRT) Service                       Increased Light Rail Transit (LRT) Capacity
$50 million                                                    $80 million
The first phase of the proposed Regional Bus Rapid Transit     Increasing LRT capacity requires 20 new light rail vehicles
(BRT) Service requires 38 accessible highway and articulated   that would make the LRT system a choice travel mode for
buses. This would provide six new regional bus services        more people within the Calgary Region. Increased LRT
linking six regional municipalities with Calgary and with      capacity in Calgary would help reduce greenhouse gas
each other.                                                    emissions.


Calgary Bus Rapid Transit Service                              Southeast LRT
$75 million                                                    (Phase 1 – Downtown to Quarry Park)
This project would extend Calgary’s transit service with six    $1.2 billion
new Bus Rapid Transit (BRT) routes in busy transit corridors   Phase 1 of the southeast LRT line, from downtown Calgary
and requires 100 articulated buses. These new buses would      to the Quarry Park residential and employment centre,
enhance public transit within the city and make service more   would carry 13 million riders and divert 2.6 million auto trips
accessible to communities and employment centers close         annually. As the service area matures, its population and
to the city limits on the west, south, east and northeast,     employment are expected to more than double by 2020: to
including the Calgary International Airport.                   157,000 residents from 61,000; and to 93,000 jobs
                                                               from 41,000.
New public transit projects such as LRT extensions                      crossing and train shunting movements. Train crossings
provide the opportunity to shape future urban development               are unpredictable both in terms of frequency and
patterns and influence the creation of more environmentally             duration, causing major delays along a goods
sustainable, transit-oriented communities.                              movement corridor.
                                                                      • grade separation at Glenmore Trail and 68 Avenue S.E.
Calgary and its neighbouring municipalities have an                     This would create a free-flow facility along Glenmore
opportunity to influence smarter development both within                Trail East, the primary east-west connection in the
and outside of city limits.                                             southern part of the city.


Stephen Avenue LRT Tunnel                                           In 2008, the Government of Canada provided $34.5 million
$550 million                                                        in funding to The City of Calgary through the Asia-Pacific
This project would increase the capacity, operating speed           Gateway and Corridor Initiative (APCI) to widen 52nd Street
and reliability of the Calgary LRT system through grade             S.E. from 114th Avenue to 130th Avenue S.E. from two to
separation of the downtown LRT line by approximately                four lanes, and from 90th Avenue to 106th Avenue S.E. from
2.5 kilometres.                                                     two to six lanes. The proposed project would link the APCI
                                                                    project to create a safer and more efficient movement of

16th Avenue (TransCanada Highway)                                   goods throughout the industrial area of southeast Calgary.

Northeast Corridor
$135 million                                                        Macleod Trail South –
This project would complete grade separation of a major             Completion of Expressway
east-west expressway and a major goods movement                     $100 million
route. This would create a free-flow facility in the northeast      This project would create a more efficient flow of goods

quadrant from Deerfoot Trail N.E. to the East Calgary               along one of south Calgary’s busiest commercial routes.

Ring Road. This project would involve the construction of           It would involve the complete grade separation of the

interchanges at the following key intersections:                    expressway portion of Macleod Trail, a major north-south

  • 16th Avenue (TransCanada Highway) and 19th Street N.E.          commuter route. This project would include the construction

  • 16th Avenue (TransCanada Highway) and 68th Street N.E.          of interchanges at the following intersections:
                                                                      • Macleod Trail South and Lake Fraser Drive.

Southeast Industrial Area Improvements                                • Macleod Trail South and 162 Avenue South.

$95 million
This project would involve several smaller projects to              Airport Tunnel –
improve travel time and reliability of goods movement due to        Grade Separation of Airport Trail
railway crossing impediments and high traffic volume. The           $200 million
smaller projects include:                                           This project would create a bridge structure option with

  • grade separation with Canadian National Railway tracks          a four-lane roadway. It would involve grade separation of

    at 52nd Street and 50th Avenue S.E.                             Airport Trail N.E. to accommodate the future second runway

  • grade separation of roadway and railway crossing to             at the Calgary International Airport.

    improve safety, reduce delays and improve travel time
    reliability. This grade crossing is subject to frequent train
BUILDING A GREENER CANADA
Regional Organics Waste to Energy                                 Solar Power Generators
Conversion                                                        $75 million
$380 million                                                      This project involves the installation of five to 15 MW Solar
The objective of this project is to convert residential waste     PV generators at City of Calgary sites, including the former
from Calgary and surrounding area to energy. This process         Imperial Oil site, Bonnybrook and Pine Creek water treatment
converts solid waste into a synthetic gas that can be used        facilities, and East Calgary, Shepherd and Spyhill landfills.
for the generation of electricity. The project also includes      Power can be used locally to offset electricity demand at
constructing a facility that breaks down residential organics,    City utility plants. Excess power can be added to the
and the development of composting facilities that includes        provincial grid.
all organics generated by residential, commercial and public
institutions.                                                     Bonnybrook Waste Water Filters
                                                                  $50 million
Landfill Gas Capture for Energy                                   The City of Calgary is required to comply with total
$10 million                                                       phosphorous loading requirements in the Bow River of
This project would expand the existing Calgary landfill gas       240 kg/d. This project involves the installation of a filtration
recovery system to increase the capacity for methane gas          project at the Bonnybrook Wastewater Treatment Plant
collection and electricity production.                            that will enable The City of Calgary to comply with these
                                                                  requirements until at least 2033.
Brownfield Redevelopment
$7 million                                                        Landfill Eco-Centres
This project involves site preparation for public green space     $9 million
development at the former Imperial Oil Refinery in southeast      The purpose of this project is to build public hazardous
Calgary. The project includes capping and soil shaping,           material education centres at each of Calgary’s three
installation of irrigation and an internal drainage system, and   landfills. These are used for residential drop off of hazardous
installation of other amenities.                                  material and would help to educate Calgarians on waste
                                                                  management issues and opportunities.
Construction and Demolition Waste                                    Public Building Renovation
Processing Facility                                                  $34 million
$25 million                                                          The Public Building is a heritage site and currently
The purpose of this project is to build a construction and           undergoing renovations to its base mechanical and electrical
demolition waste processing facility at one landfill site.           systems to bring it in compliance with environmental
Construction and demolition materials currently account for          regulations. Additional funding is required to ensure that
18 per cent of Calgary’s waste stream.                               the facility complies with modern functional and
                                                                     environmental standards.
Recyclables Processing Facility
$30 million
The objective of this project is to build one central site for the
recycling of industrial, commercial and institutional materials.


Corporate and Satellite Office
Facility Investment
$190 million
The purpose of this project is to upgrade many corporate
and satellite facilities essential to The City’s operations.
Today, these facilities either do not meet code or are unable
to sustain current demands due to age or deterioration.
Significant investment is required to maintain them to
a minimum standard of safety, functionality and energy
efficiency.


New Administration Building
$157 million
The City’s employment growth now exceeds its available
inventory to accommodate its workforce. The purpose of this
project is to construct a new, larger and more energy efficient
City Administration building to accommodate City staff and
the citizens they serve.
ENHANCING THE SAFETY OF
CANADIANS
East Core Protective Services                                    Airport/Skyview Ranch Fire and EMS Station
Response Station                                                 $14.5 million
$18.5 million                                                    The rapid growth of The City of Calgary has created strain for
The City of Calgary has identified opportunities to leverage     Fire and EMS first responders. This dual station will provide
existing assets and to maximize opportunities to co-locate       street level response to Calgary’s far northeast, as well as
facilities in areas of high need. A good example of this is      airside response to the Calgary International Airport and
in Calgary’s East Village downtown. The City of Calgary is       new runway. Currently, The City of Calgary has a contractual
proposing to build a multi-use service operations station that   obligation to the Calgary Airport Authority to provide first
includes Fire, EMS, and Animal & Bylaw Services, in order to     response within 3.5 minutes. The construction of this station
provide enhanced and timely services to the downtown area.       will allow The City to satisfy this requirement.
PROVIDING ARTS AND CULTURE TO
CANADIANS
Upgrade to Devonian Gardens                                         Calgary’s science centre is one of the smallest centres in
$33.6 million                                                       comparable cities around the world. An excellent science
When the Devonian Gardens opened in 1977, it was a state-           centre and children’s museum is a vital resource for inspiring
of-the-art facility that attracted world-wide attention. This 2.5   young people as learners and a key amenity in attracting
acre enclosed roof garden holds 20,000 plants and contains          new businesses and creative individuals to the city.
a full mile (1.61 km) of lush walkways. Today, however, much
of the infrastructure has reached its 30-year lifecycle. This       New Central Library
project includes plans to redesign the interior spaces to           $151 million
improve public access and meeting and play areas while              Libraries are important institutions for educating our
enhancing the interface of the gardens and the revitalization       population and providing citizens with essential skills to
of the downtown core.                                               contribute to the betterment of Canadian society. A new
                                                                    downtown branch of Calgary’s public library system is
New Calgary Science Centre Facility                                 needed. The existing facility can no longer accommodate the
$55 million                                                         increased demand for products and services that the library
A new facility is required to best serve the needs of one           offers Calgarians.
of the youngest, fastest-growing and best-educated
populations in North America. After 40 years, the existing
facility has not only run out of room, it is challenged by the
expansion of adjacent transportation corridors.
CREATING HEALTHY OPPORTUNITIES
FOR CANADIANS
Regional Recreation Centres                                         Indoor Multi-Sport Facility
$100 million                                                        $140 million
Two new major regional recreation centres are required in the       Currently, Calgary does not have an indoor multi-sport facility
growth areas of northwest and southeast Calgary.                    to host national and international athletic competitions. The
Each centre would be approximately 200,000 square feet              proposed facility would house track and field amenities such
(18.58 m2) and would house amenities such as aquatics,              as a running track, high jump, long jump, shot put, etc. While
fitness, gymnasiums, ice arenas, multi-purpose spaces,              it would be used primarily as a year-round training facility,
outdoor fields, arts spaces and social services.                    it would be capable of hosting significant national and
                                                                    international sporting competitions and events.

The City of Calgary would partner with community and
not-for-profit organizations in the design and operation of
each facility. The facilities would not only provide a variety of
active and passive recreation opportunities, they would also
serve as a vital community link to the citizens.
IV. CONCLUSION
                 Canadians are looking to all orders of government for
                 solutions to help them through these turbulent economic
                 times. With Budget 2009/10, the Government of Canada has
                 an opportunity to implement a robust economic stimulus
                 package that would satisfy Canadians from coast to coast.


                 The City of Calgary is pleased to be given the opportunity
                 to provide input. The Government of Canada has many
                 tools at its disposal, ranging from direct financial investment,
                 tax incentives and ensuring access to capital for private
                 sector investment. The City of Calgary is committed to
                 working together with you to deliver a stronger and more
                 competitive Canada.
2009-0022

								
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