Illustration Dominic Bugatto
Don’t be fooled. Last month’s municipal election in Calgary may have been less dramatic than the one that swept Mayor Naheed Nenshi to power in 2010, but in time it may prove to be much more important. That’s because behind the usual round of photo opportunities, lawn signs and petty ward-level squabbles was a fight for the city’s soul.
On one side there are those, including the mayor, who want to push the city in the direction of becoming a more cosmopolitan urban centre with a vibrant downtown and robust public transit. On the other, there are those who want to see it remain a laissez-faire conservative idyll, a monument to wide open spaces, cozy suburbs and the untrammelled rights of motorists. And while Nenshi made it through the election, that war is still far from over.
Indeed, it may only be beginning. That’s because, for all of his personal popularity, he still only has one vote on council thanks to Calgary’s “weak mayor” system. As such, a united block of eight councillors could stonewall his plans for the forseeable future. His opponents are well aware of that reality, too. Cal Wenzel, one of Calgary’s leading home builders, summarized that strategy in a speech he gave in April. “As long as you have eight votes,” he said, “you can control whatever happens.”
“We seem to be under a social engineering program.” – Cal Wenzel
He didn’t know he was being filmed, but the grainy video, shot on a camera phone and leaked to Global News, put the strategy in plainer view than Wenzel would have liked. In it, he proclaims that city hall is spiralling out of control, run by planners who want communities with no cars and homes barely larger than closets. But all home builders like him need to put a stop to it are eight votes – a bare majority – on Calgary’s city council. And he tells the audience that he has a plan for how they can get them, too, listing which councillors are for them, against them and which wards are vulnerable to political – and monetary – pressure. He wasn’t bluffing, either.
If Wenzel’s message lacks finesse, it’s not without substance. Home builders like him have reason to be concerned, after all. In 2005, the year that Calgary’s population grew the fastest in its history, central and older neighbourhoods were actually hollowing out. All of the city’s new growth was happening in new neighbourhoods along the city’s fringes. Meanwhile, older neighbourhoods lost as much as 25 per cent of their populations. And while this so-called doughnut effect is the bane of urban planners, it’s a recipe for success when you’re in the business of building suburban homes.
What has people like Wenzel worried is the progress that the city has made in reversing that trend. Since 2005, population loss from the downtown core has begun to abate, with condos and townhouses popping up on increasingly busy downtown streets. In contrast to the height of the boom, 93 per cent of new growth in the city now happens in the suburbs, and Nenshi has said the target is to reduce that to 50 per cent.
Now, there’s nothing inherently wrong with suburban development. The modern suburb has proven to be massively popular in a post-war North America flush with cars and kids. However, as cities across the continent have discovered, suburban development is an expensive way to grow. That’s because the less dense a neighbourhood is, the more costly it becomes on a per-unit basis for cities to provide basic infrastructure like roads, parks, sidewalks, maintenance, sewers and pipelines. The further a city spreads, the more difficult it is to provide transit – which leads to more cars on the road, and more congestion and upkeep.
And while Calgary may be blessed with a seemingly endless supply of open space, it is learning the cost that comes with this kind of growth. In 2000, the city stopped charging developers the full cost of the infrastructure used to service new greenfield communities. The city has since spent $1.5 billion to build a new water treatment plant along with sewer and pipeline services to the suburbs, an investment that accounts for more than 40 per cent of the city’s total outstanding debt load of $3.6 billion.
“There’s nothing natural about the way Calgary has been built,” says Nenshi. “The mechanism that we have now, which puts the thumb on the scale to vastly benefit greenfield versus brownfield development, is social engineering.” Nenshi says he’s merely trying to tip that scale back into balance. In 2011, city council reinstated half of the levy on new development that had been abolished 11 years earlier. But the books are still in the red. Nenshi estimates that every new house built in a greenfield neighbourhood costs taxpayers and ratepayers $4,800 more than the city gets in levies. If you multiply that by the number of housing starts, that’s between $34 and $48 million each year.
Within the next three years mayor says he’d like to see the remaining gap closed – a promise that has prompted home developers to strategize about how to elect “pro-business” councillors. “That’s what some of the folks in the building industry are really upset about. It’s that crass,” Nenshi says. “It’s not about philosophy. They’re going to lose a subsidy that goes directly into their pocket.”
That’s not exactly how the developers see it. Responding to the leaked video in April, Wenzel argued that most people want to live in single-family suburban homes – just like the ones he builds. Placing limits on that growth will simply lead to higher prices. “We seem to be under a social engineering program,” he told reporters.
James Maxim also cites housing affordability as one of the reasons he ran to unseat incumbent Brian Pincott in Ward 11. A businessman with experience in international trade and the oil and gas industry, Maxim also happens to be a longtime friend of Wenzel’s.
The relationship between council and developers has “been a good relationship in the past, but I think it’s broken down in a few areas,” Maxim said, at a charity bowling event in August. “With leadership, new direction and a willingness to work at it, I think we can overcome those problems and get on with what needs to be done at city hall in support of developers to enable them to meet their commitments.”
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Densification has been going on in Calgary for years, he added. And on the $6-billion development industry, “They play a very key role. They’re the soccer moms and the hockey fathers and they contribute to the economy and at the same time, they’re taxpayers. So I’m supportive of their industry just as much as I’m going to be supportive of any other industry.”
Maxim also said he had attended courses at the Manning Centre. Led by Preston Manning, the Manning Centre and Foundation have a mandate to build the country’s conservative movement through training and research. “I saw it as a learning experience,” Maxim says.
Still, it’s hard to see his relationships with both Cal Wenzel and the Manning Centre as coincidental. In the leaked video, Wenzel said he and 11 others had each put up $100,000 to bring the Manning Centre on board. The group also contributed $10,000 in seed money to Common Sense Calgary, a lobby group that launched a website warning Calgarians that city planners could spark a Vancouver-style housing affordability crisis. And soon after the group’s donation to the Manning Centre, it launched its Municipal Governance Project, which sought to “train” Calgary candidates in addition to publishing several research papers on issues facing municipal governments ranging from citizen satisfaction to taxi regulation reform.
The foundation appointed David Seymour, a public policy researcher who worked in New Zealand and Saskatchewan, to run its municipal governance project. He’s since authored several papers on subjects like road tolls, taxi regulation and the proper limits of a municipal government’s mandate.
“The question is, can you set arbitrary targets centrally, or are you better off with development [that’s] less regulated and moderated by price?” he asks. “The city has some work going on around the way infrastructure is priced. Then the question becomes, is the city prepared to make a bargain where as long as people pay for the infrastructure they use, they’re no longer required to adhere to abstract [growth] ratios and so on?”
Seymour fears that if the city miscalculates the demand for different housing types and transportation modes, Calgarians will be stuck with shortages in suburb-style housing and the resulting price increases. The researcher adds that he’s not a suburban warrior by any stretch, but he questions how effective the municipal government’s targets will actually be.
“The analysis that shows that no regulation leads to affordable housing doesn’t exist,” Nenshi counters. “There are a couple of folks who tried to make that argument, but the analysis was thoroughly discredited.”
The mayor insists he’s amenable to whatever study or research the Manning Centre publishes. But, aside from one high-quality survey, he hasn’t yet been impressed. “I’m sad to say that the first three papers from the Manning Institute haven’t added anything to the conversation. They’ve actually been terrible,” he says. “There was one beautiful survey that had high-quality data in it, but the actual discussion papers they’ve written read like first-year papers on libertarian philosophy. They don’t have case studies, they don’t have any examples, they don’t have any evidence … they rely on Google searches of discredited economic arguments from other places. I would actually love to see them do some real research.”
To some extent, this is tough talk coming from a mayor seeking a fight. And for its part, the Manning Centre has proven to be a fickle ally to the home builders. Just two weeks before the election, it released a report that suggested single family home owners should pay the full costs of the infrastructure that they use, including higher property taxes.
But the conflicting visions presented by the two sides aren’t likely to be settled by a single report – or a single election, for that matter. Druh Farrell, the long-time, left-leaning councillor for the inner-city Ward 7, says people must be afforded choice when it comes to deciding where to live, but that everyone should be aware of the costs associated with those choices. “That’s why the people funding the Manning Centre are so upset, because we’re actually talking about ending public subsidies and that’s a big change.” She says she found the video worrisome. “It was a small group of men wanting to control council for their personal gain. It comes down to the vote: ‘All we need is eight votes.’ Eight votes for what?”
The Burbs
North American cities have long favoured suburban development. The original New York Levittowns upon which city planners modelled future suburbs were the epitome of social engineering. These were neighbourhoods meant to house the nuclear family ideal: mom, dad, a handful of kids and a car in the driveway. But far from being a product of the free market, suburbs were heavily planned, prefabricated, low-cost neighbourhoods built wholescale to accommodate returning soldiers and the burgeoning wealth of the North American middle class. They were also notoriously racially segregated; the original Levittown refused to sell to non-Caucasian families. Nonetheless, with their yards, wide streets, relatively cheap space and good schools, the suburbs were – and remain – enormously popular.
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