We’re dirt poor!

It came earlier than many would have expected, but it’s here: Edmonton hasn’t got the money it needs for capital investments.

And even city officials, Mayor Do0n Iveson included, concede spending taxpayer money to help build a new professional sports arena, plus the many bells and whistles that come with it, is a major reason.

The capital budget report council received May 1, was specific: there won’t be more money in the kitty for larger (never mind large) infrastructure projects than $30 to $50 million a year.

Now, granted, $30 to $50 million is a huge chunk of cash for anyone who’s never won LottoMAX, but it is peanuts for a city Edmonton’s size.

Expansion of the LRT was one of the three reasons cited; plus two other items: the so-called downtown revitalization and the arena district. These were the main culprits.

The LRT should not have been among them.

Why not? For a simple reason: expanded public transportation helps a community, while public spending to help build a private professional sports arena helps that professional sports club’s owner. That’s how it is.

Downtown revitalizations using all kinds of entertainment complexes have been found wanting in all of the case studies conducted all across North America. These projects have no other impact than helping those complexes’ owners minimize their investment and maximize their profit.

Profit is NOT a dirty word. It’s just that it ought to remain in the private sector of the economy. You invest, and if you’ve invested wisely, you gain a profit.

In Edmonton’s case, just as in so many other cases across this continent, taxpayers invest, but they are not the owners. They used to get promises what this or that will do to their community’s economy (employment increases, taxation income increases and whatnot). When time, the great judge, provided proof galore that this was spectacular nonsense, promises would change thus: public participation in such private projects would make yours a top-league community, it would boost civic pride, and a number of other esoteric statements. A number of sociological and demographic studies on this subject have been unequivocal. None of this would have anything to do with the community’s well-being, but everything to do with the private proponents’ well-being.

Again: there’s nothing wrong with entrepreneurs making money. There’s everything wrong with them, aided and abetted by governments of all levels, making this money with taxpayers’ help.

Craziness beyond belief

In Edmonton’s case, the situation is even more ridiculous than anywhere else. The sports club’s owner intends to build an office tower close to his new arena, and he talks council into agreeing city’s employees would move from the locations they’re using now to that new tower. That would boost its occupancy. Yes, leases in some of those current locations are about to expire. Not in all of them. Who’s going to pay for the transfer, in general? And who’s going to pay for the termination of existing leases, in particular? The office tower owner?

Besides, as many of the existing economic studies prove beyond any doubt, reasonable or otherwise, it’s the office towers that drive the population from downtown areas to the suburbs. Just imagine applying for zoning to build a single-family house close to, say, the Manulife building, or Scotia Place. Building yet another office tower won’t help alleviate the exodus trend one iota.

Meanwhile, city property taxes went up by almost five per cent (4.92 per cent, to be precise). Considering Canada’s inflation rate was less than one single percentage point (0.94 per cent for precision’s sake) last year and it is not expected to increase any time soon, Edmonton’s property taxes have outpaced the country’s inflation rate five-fold.

If this is not a good reason for concern, one wonders what is.

To put this into context: an average homeowner whose property is valued at about $375,000 (nothing unusual in this city), will be paying about $127 more in city taxes next year.

Is the new arena still so shiny?

We do so need the LRT

There have been some, and their voices have been rather loud, asking why Edmonton needs another expansion of the LRT in the first place. In fact, some went so far as to suggest Edmonton needs no LRT, period.

Three cheers for economic illiteracy!

First of all, one of the most important standards to measure an individual community’s level of civilization is the level of its public transportation services. Not only because of such considerations as the level of pollution created by exhaust gases.

Let’s use a specific example: some are badmouthing the city for extending the LRT all the way to the NAIT campus. How do they expect an ever-increasing number of students from all over the place to make their way to the school? Are the majority of them rich enough to afford their own cars? Sure, if there’s no LRT, it might (but then again, might not) make used car sales go through the roof. Are Edmonton’s roads capable of accommodating such an increase in traffic? The answer is simple: no, they are not. Still, even if the city had enough dough (and we have just found it doesn’t) to expand its roadways, those students will have to park somewhere. Where? And who’s going to pay for it?

Please remember: growing numbers of students in such post-secondary schools as NAIT (or Grant MacEwan, for that matter, or University of Alberta, even) is a sign of a healthy community that is taking care of its future.

An aside: that part of the extended LRT will help ease transportation choke points in the Victoria School neighbourhood, as well as in the Grant MacEwan area, too.

We don’t need the LRT in Mill Woods, comes another battle cry. Guess what: you do. As the city population grows, soon enough it’s going to be impossible to get anywhere outside of Mill Woods in time if you drive a car and haven’t made the precaution of taking off at least a quarter of an hour ahead of time.

It’s getting perfectly scary during peak hours even now.

Yes, the NIMBY (Not In My Back Yard) calls would be heard less if the LRT went under the ground throughout. A more expensive investment in the beginning, but one that would have paid off quite nicely sooner or later. It didn’t happen, and this shortsighted approach might warrant another story for another day, but even so: even if the city discovered an endless supply of money, and was spending it wisely, Edmonton cannot continue to expand to cover the entire province of Alberta, eventually.

Whom are we paying for?

Alberta’s capital city has to make do with what it’s got, just like everybody else. That includes ignoring private egos such as that of former Mayor Stephen Mandel (or his successor in office, Don Iveson), and telling all professional sports clubs’ owners where to get off when they ask for (demand is a better expression) public money to help build their new arenas.

Here’s another piece of basic economics: if you decide to delay a necessary step, for example, by a year, because you haven’t got enough cash on hand at the moment, your costs that one year later will go up. Not just marginally. They may double.

Need an example? If Edmonton does such a lousy job of maintaining its network of roads as it has in the few years past, the cost of fixing the earlier mistakes will be there, together with costs of fixing new problems. More precisely? How about this: the city had a significant number of roads re-paved last summer. Whether they had no quality control or whether it was insufficient is not relevant. And excuses that this past winter was harder than many winters in previous years doesn’t make it, either. The fact remains: those newly re-paved roads need fixing, and a lot of it. Meanwhile, other roads, those that didn’t get the extended loving care last summer, need fixing, too.

It could have cost a bit more last summer, to do the re-paving job right in the first place. Now, it’s going to cost much more.

And the city is crying it’s on its way to the poorhouse.

It would be funny if it wasn’t that pathetic.

New projects will have to wait till the new election cycle (and, basic arithmetic suggests, beyond). Meanwhile, we’ll be pouring money we haven’t got into a pipedream, a.k.a. downtown revitalization, a new arena for the Oilers, to be more specific.

If we re-elect these rascals again, we’ll have nobody to blame but ourselves.

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