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January 23, 2012

Governing growth

Industry questions City’s new growth rules

Pepper Rodriguez

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The City of Calgary is setting new rules to regulate the growth of southern Alberta’s largest urban hub, but some in the new home industry aren’t convinced that this is the way to control growth and could lead to bigger problems down the road.

The city is completing a new nine-point set of criteria called the Corporate Framework for Growth and Change to use as a guideline in determining future development of new land.

City officials say this will be a more transparent way for City Council to make their decisions on where and when Calgary grows. The framework — based on a grading system for each of the nine-point criteria — will present Council with a broader picture as opposed to the past when land development had much more to do with first-through-the-door or promotion by a particular landowner, says David Watson, the city’s general manager of planning development and assessment.

But Michael Flynn, executive director at Urban Development Institute — Calgary, says this new framework may have a restrictive effect on growth that might be harmful to homebuyers in the long run.

“We see this new framework as almost unnecessary, another hoop to jump for the industry,” he tells Condo Living, adding that it added an “unneeded extra layer” to the Plan It municipal development initiative that the city already has.

While Canadian Home Builders’ Association — Calgary Region President Carol Oxtoby cautions against hasty decisions by Council. “It is important that our City Council understand the full consequences of their decisions. It’s not as easy as turning off a tap in one area and seeing an increase in flow of development in another. There can be many factors at play including desirability of location, assessing financial ability to proceed and market affordability thresholds.”

The nine-point Corporate Framework for Growth Management criteria includes: capacity of existing infrastructure; community services in place, city-funded costs; access to transit; land supply; readiness to proceed; contiguous growth; innovations in design; and access to employment centres.

At the last Council meeting in December, Council made the decision to move forward with a ranking system for each criteria and directed administration to continue with stakeholder engagement to determine a process to weigh the criteria in order to set growth priorities. 

The city is still meeting with key stakeholders over the next few months to hammer out the final framework slated to come out on April 12, this includes finalizing the list of metrics that grade the importance of each criteria. Both UDI and CHBA — Calgary Region say they will continue to meet with administration and encourage our members to participate in this process on behalf of future homeowners.

Flynn says they are continuing to work with the city to make the guidelines as fair as possible but he does raise a few concerns. “There are a few positive aspects to thesenew rules that we see, but we do have some concerns. For one thing, there will be far fewer green field development.”

What this means is that the city will no longer be fronting the money for the development of undeveloped land and that the developers will have to come up with all the funding on their own. “There are only a couple of companies big enough to do this on their own in Calgary, which could lead to monopolies.”

He says this will also lead a trend towards the redevelopment of existing houses rather than building new ones. “This is a significantly more costly undertaking for homebuyers than building a new home, it could also lead to a steep increase in prices of homes.”

Flynn adds that this new framework will not only add to costs of developers but will also cause considerable delay in pushing forward new projects. “Calgary has attracted a lot of immigrants in the past which is a key component in its continued growth, but what happens when there are fewer housing choices?”

Oxtoby raises concerns about the metrics ranking system. “We feel that a ranking system or scorecard may not allow for adequate discussion to take place in order to determine the true benefits or challenges of a particular application. Criteria should be flexible enough to reflect different approaches for more exigent applications or for those applications where alternative financing (no upfront contribution from the City or utilities) is a viable option.”

She adds: “We would also like to see the criteria reflect more than just the land supply, but to delve deeper into a unit analysis to determine what product is currently available and what is desired in the near future. Much of a ‘complete community’s’ success is market driven and based on unit availability. In other words, there may be numerous multi-family options still available within a new community but very few opportunities for single-family homes to be built in that same area. This would show an imbalance between what is planned and what is desired by the public.”

 

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