EDITORIAL COMMENT - Dec. 27/06 -
                                            Gasoline Alley Annexation Will Be Costly to Taxpayers

 
Editorial Comment
 
Dec. 27, 2006

Gasoline Alley Annexation Will Be Costly to Taxpayers
 
The 'Future Directions' growth strategy recently adopted by City Council seems to make sense, providing for orderly growth over the next several years in all directions. The strategy maintains the downtown as the centre of the city, balances commercial and industrial land use, and preserves a considerable amount of green space.

It is a strategy, however, that will be very costly to both the city and the county, especially with the inclusion of Gasoline Alley. Implementing the plan will increase taxes in both municipalities. It will also result in the loss of the co-operative relationship between the city and county that has developed over many years. The uncertainty of conflict will cause developers to look elsewhere.

The cost to the county is tremendous in that the potential loss of Gasoline Alley robs the county of 30% of its tax base. In fact, the city's overall growth strategy will take away most of the county's commercial and industrial revenue.

Last year, recognizing the city's need and right to grow and in an effort to avoid a prolonged war over land, the county presented the city with a plan providing for growth in all directions except the south and southwest. This plan would have the county giving up a huge portion of its tax base in return for being allowed to make up its loss by developing in the south, including Gasoline Alley.

The city turned down the proposal expecting the county to accept that the city has the right to grow in all directions as it sees fit. There is an underlying belief in the city that the county has no right to encourage urban-style development anywhere near the fringe.

However, councillors and administration have maintained that it had no interest in Gasoline Alley as it would be too costly to bring it up to city standards.

And they were probably right. In annexing Gasoline Alley, no one wins.

County taxpayers will see their taxes increase as the result of the loss of its primary source of revenue. City taxpayers will also see their taxes increase, first to compensate the county for the infrastructure and short term tax loss and then to replace the infrastructure to bring it up to standard.

In addition, there will be the immense cost of litigation fighting the county as the county believes it has no choice but to oppose any annexation of Gasoline Alley.

The primary beneficiaries of the resulting uncertainty will be Blackfalds, Lacombe, Sylvan Lake, Penhold and Innisfail, not necessarily a bad thing. But other beneficiaries will include Airdrie, Balzac, Leduc, Edmonton and Calgary.

The only cost-effective solution is for the two municipalities to form a joint development zone in the south with jurisdiction remaining in the county with a long term tax sharing plan to compensate the city for urban services.

Costs are reduced. Integrity, co-operation and opportunity are maintained. Everyone wins, especially the taxpayers.

Paul Pettypiece


Other commentaries on this subject:
News Flash! Mar. 23, 2007 - City and County Working Together for Growth
Background Report Dec. 16, 2006 - 'City and County Disputes . . . Challenge and Opportunity'
Background Report Dec. 16, 2006 - 'The Dynamics of Competitive Rapid Growth'
Editorial comment July 26, 2006 - 'Annexation Spat Needs Local Fix'
Editorial comment July 26, 2006 - 'City and County are Partners in Growth'
Editorial comment Mar. 9, 2006 - 'City/County Dispute Will Benefit No One'
Editorial comment Feb. 24, 2006 - 'City and County Need Joint Vision'
Red Deer Future Growth Maps
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