Building a great city means making strategic decisions on how best to allocate municipal resources to build and maintain the infrastructure Edmontonians will require in the years to come.
Edmonton is a growing city and demands arise for new infrastructure to support its growth. Citizens expect to be provided with infrastructure and services consistent with a modern and progressive city.
At the same, the City’s infrastructure ages, and maintenance and rehabilitation is required to ensure that infrastructure is performing well and continuing to meet the needs of citizens and businesses. As a conscientious owner of a $40 billion inventory of municipal assets, the City must make decisions in terms of when and how to maintain, repair, renew, replace or retire key assets in a cost-effective manner.
To determine the City’s infrastructure needs, a 10-Year Capital Investment Agenda maps out the City’s capital needs and priorities for new growth projects and renewing existing infrastructure, and also identifies known funding sources and the City’s financial capacity and debt position. This then informs the next 4-year Capital Budget (2015-2018).
The draft Capital Investment Agenda 2015-2024, reviewed by City Council on April 30 and May 14, 2014, shows that there is a gap between what has been identified and what the City can afford: about $15.5 billion in infrastructure projects have been identified over the next 10 years - about $5.5 billion for renewal of existing infrastructure and approximately $10 billion in new infrastructure projects. This is compared to the $7.4 billion that has been identified as the amount that the City can afford.The gap of just over $8 billion means that despite maximizing its investment dollars, the City will not be able to deliver all that has been identified.
City Council has already committed to fully funding the required investment in renewing existing infrastructure in the upcoming capital budget cycle (2015-2018), and thereby maintain the trend of keeping pace with renewal requirements. Doing so, however, will limit potential investment in new growth over the next four years, since less capital budget dollars are available overall.
Criteria for determining 2015-2018 Capital projects
In order to determine which new infrastructure projects should be chosen, business cases are being created for the top projects and criteria have been developed to assist in strategic decision-making.
The criteria for determining new infrastructure projects are as follows:
- Mandate (Legislated, prior Council direction, etc.)
- Geographic Impact (for public facing projects) OR Organizational Impact (for internal support projects)
- Value for Money, which includes the following sub-criteria:
- Anticipated Change in Demand (over and above average growth)
- Capital or Operational Savings
- Level of Service benefits
- Project Readiness
- Ability to supplement a renewal project
- Strategic Alignment with Council’s Corporate Outcomes
- Ability to address Operational Risk
Since our municipality’s renewal needs and growth demands exceed what the City can actually afford over the next 10 years, these criteria serve as an important guide in the capital planning process.
City Council is scheduled to make decisions on the 2015-2018 Capital Budget in late fall 2014.