The Government of Alberta Needs to Fund the Green Line…But How?

In November I brought this Notice of Motion to Council:

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Last week Mayor Nenshi sent the official letter to the Transportation Minister requesting funding for the Green Line LRT.

Difficult Times in Alberta

Completion of the Green Line will require a funding commitment from the Provincial Government.  The Members of the Legislative Assembly I have spoken with are certainly supportive of this project, but point out that the current economic situation is providing some road blocks.  With low oil prices anticipated to continue for the foreseeable future, there will be significant impacts on government revenues.

Difficult times bring hardships, but they also bring opportunities.  Right now interest rates are among the lowest we have ever seen, the availability of construction labour is high and the cost of construction materials is low.  Investing in the Green Line today will increase the standard of living for hundreds of thousands of Calgarians.  By investing today when costs and interest rates are low, we have an opportunity to save tax payers hundreds of millions of dollars.   In short, now is a great time to build!

Calgarians have been hit hard over the last year and unemployment rates are on the rise.  It is estimated that the Green Line could create upwards of 23,000 construction jobs.  The sooner this project begins to move forward, the faster we can put these folks back to work.

Together We Can Find a Way

In my view there are 4 different funding mechanisms for the Provincial Government to consider:

  • Carbon Pricing: In the fall 2015 budget the Provincial Government announced a carbon pricing framework. Carbon pricing will take effect in 2017 and is projected to generate $3B in revenues annually by 2018.  The Premier stated that “carbon pricing revenue will be fully reinvested into measures that reduce pollution – including green infrastructure like public transit”.  The Premier’s comments bode well for the Green Line.
  • GreenTRIP funding: GreenTRIP funding has been very successful for small or medium sized projects.  In order to satisfy the funding commitment for a project like the Green Line LRT, GreenTRIP would need greater funding.  GreenTRIP could eventually evolve into the Provincial equivalent of the Public Transit Fund that the Federal Government created in the spring of 2015.
  • $4.4B for future infrastructure: The fall 2015 budget set aside $4.4B for future infrastructure investment.  Calgary represents roughly one-third of the Province’s population, and one-third of this fund would satisfy the Provincial Government’s contribution to the Green Line.
  • Sharing property tax increases: The City of Calgary collects property taxes on behalf of the Provincial Government.  Typically the Province takes the same % increase that the City takes.  The Provincial Government could dedicate a portion of their annual property tax increases to fund the Green Line.  This would leave existing budgets untouched and would essentially be a Calgary made funding solution for a Calgary-centric project.

I’d like to see the Province make a commitment to the Green Line in the spring 2016 budget.  The City of Calgary does not need a cheque for $1.53B tomorrow (although we would welcome it).  What we do need is clarity from the Province.  The Federal Government committed to funding this project once they received an application from the City of Calgary that fit the criteria established.  The Provincial Government could essentially do the same thing.

Edmonton

The Provincial Government has an opportunity to make an investment that will transform Calgary for decades to come.  I sincerely hope they make the most of this opportunity.