Report urges city to make changes to attract industrial development

Edmonton is losing commercial and industrial development to surrounding municipalities and should take steps to ensure this lucrative source of taxes doesn’t drop further, a new city report says.

Over the past 15 years, Edmonton’s share of the region’s non-residential property assessment has declined to 72 per cent from 76 per cent, largely because the city has been “out-competed and out-performed” by its neighbours, according to a report released Thursday.

But it’s critical for the city’s longterm financial health to attract more industry, which pays a higher tax rate than housing — industrial sites generated $211 million in property taxes last year, or 16 per cent of Edmonton’s total levy.

“The city does not financially benefit from non-residential tax growth outside its boundaries, and must continue to build and maintain a strong non-residential tax base through industrial development.”

Although local energy-related manufacturing and logistics jobs have been lost during Alberta’s economic downturn, the report says this should start to turn around next year and predicts about 35,000 industrial jobs will be created by 2026.

To set the stage for long-term growth, it suggests the city take nine policy steps, including:

Increased flexibility for industrial subdivision design standards, which are often higher than in surrounding communities.

For example, Edmonton generally requires expensive storm sewers to handle rain and underground power transmission, while rural districts allow cheaper drainage ditches and overhead electricity lines.

Faster approval of permits. A common developer complaint is the time needed to approve projects, so one possible solution is setting up a dedicated team with a guide to help firms through the process.

Rejigging the funding process. Developers must now overbuild infrastructure to cover what will eventually be needed to service neighbouring property, recovering their costs from a fund that is now fully subscribed.

The report proposes creating a new model that uses money from a portion of the increased property taxes the industrial area will create and levies on future projects in the district.

Move ahead with plans for the Edmonton Energy and Technology Park. This northeast sector covers more than 4,800 hectares designated for petrochemical-based industries, manufacturing and logistics.

By the time it’s finished in 2066, the area is expected to expand Edmonton’s industrial land base by one-quarter, employ about 75,000 workers and pay a total of $2.4 billion to $4.2 billion in non-residential taxes after the cost of building, operating and maintaining the infrastructure is deducted.

The report will be discussed Tuesday by city council.