As the city slips further behind in the maintenance of existing roads and bridges, a growing portion of its budget is being dedicated to building new ones. Already consuming more than a fifth of total road spending, road “growth projects” will take up nearly a third next year, and 44 percent in 2017.
This year $120 million in maintenance of existing road infrastructure is deemed unaffordable. Since 2013 and including this year more than $65 million of the roads budget has been dedicated for “growth projects” and another $70 million is earmarked over the next two years. And these numbers don’t include some traffic signals and bridge work that are also driven by new development.
For example, the $14.7 million project currently underway to replace the railway bridge at the north end of Centennial Parkway was initiated in response to the opening of the Walmart-centred big box complex next to the QEW but it isn’t listed among the growth projects. The city is paying the full tab including $4.29 million budgeted for this year after CN Rail deemed the bridge “in no need of reconstruction”.
The budget documents show most other growth projects are being substantially financed with development charges (DC). The DC allocation for new roads generally covers 85 percent of costs with the remainder designated as beneficial to pre-existing development and therefore covered by taxes.
However, half the DCs for each road project are allocated to non-residential development and those fees are substantially discounted so taxpayers end up having to make up the difference. In addition, development charges can only be collected for initial construction costs. The ongoing maintenance and repair costs must be covered by property taxes.
The largest growth project in 2015 sees $11 million for the Waterdown bypass that will eventually cost nearly four times that amount. Others this year include Highway 56 in Binbrook, and First Road West in upper Stoney Creek. Design work is also starting on upgrading Nebo Road, from Rymal to Twenty Road, with $4.7 million earmarked for construction next year.
At this point, the 10 year capital budget doesn’t include any work on infrastructure for the recently approved Airport Employment Growth District (AEGD) or anything beyond studies related to the Stoney Creek urban boundary expansion approved eight years ago.
Calculations made in 2010 for a slightly larger AEGD determined that $351 million would be required for internal roads, pipes and other infrastructure. Substantial development of this industrial business park will also require a new trunk sewer line and likely additional major water pipes.
Three major road works also not listed as growth projects are underway on the northern edge of the AEGD and the orphan rural islands created by the recent deal between the city and developers. These include widening of Garth between Stone Church and Rymal at a cost of $4.5 million and nearly $10 million in work on Rymal itself between West 5th and Upper Paradise that is just getting underway with most expenditure in 2016-17.
Growth costs are also very substantial in the city’s water and sewer budget but are less clearly delineated. Development charges being allocated to capital works in that budget exceed $40 million this year and climb to $75 million next year. The biggest project is a trunk sewer up Centennial Parkway that will eat up $13.2 million this year.
The water-sewer budget includes $7.7 million covered by ratepayers to make up for development fee discounts and exemptions. Ratepayers also cover a significant portion of road project costs where the work includes water or sewer pipes.