Downtown Economic Summit
The downtown has long been Calgary’s economic engine. Across the city, businesses and households depend on the success of our downtown. When the economy of our downtown falters, the financial impacts are felt throughout Calgary.
Until recently, the centre city generated 40% of Calgary’s non-residential tax revenue and 25% of city-wide employment. Today, nearly 30% of downtown office space sits empty, and the situation is expected to worsen when construction wraps up on several new office towers.
Between 2016 and 2018, it is estimated that $7.5 billion in the assessed value of downtown office space will be wiped out. The dramatic change in the downtown economy has knock-on impacts to all Calgarians, not only in a transfer of taxes to businesses outside the core, but also a steep reduction in transit and parking revenues.
To help mitigate the tax shift, Council supported $45 million in one-time city-wide tax relief for businesses and set a 0% residential property tax increase in 2017. While these are important measures to provide short-term assistance, we need long-term solutions to address the root cause of Calgary’s challenges – a struggling downtown economy.
Councillor Woolley and I, with guidance from Calgary Economic Development, initiated a Downtown Economic Summit in early 2017. The Summit brought together some of the most creative problem-solvers in Calgary to generate ideas for a more resilient, resourceful, and diversified downtown. We learned from the experiences of other cities, like Denver and Pittsburgh, on ways to recover from structural recessions.
Calgary Economic Development presented the outcomes of the Summit to Council in June, with information on current economic and real estate challenges, as well as ways to move forward. They showed how the global economy is fundamentally shifting, which has a major impact on the downtown’s reliance on a single industry.
The report recommended ways to attract new industries and businesses, promote more residential density in the core, encourage post-secondary institutions to locate downtown, and improve infrastructure to attract private investment.
To help bring these recommendations to life, Council approved $10 million as a pilot from The City’s reserves to create the Downtown Economic Investment Fund. This money will help The City respond quickly to innovative ideas, encourage and leverage private investment through strategic partnerships, invest in infrastructure, and work toward revitalising our core.
Not all is doom and gloom! The Conference Board of Canada estimates that Calgary’s economy will grow by 2.3% in 2017, with 19,000 new jobs added by 2018. This is encouraging and means The City’s investment can go even further to help improve our economy and get Calgarians back to work.
To sign up for updates on key community and Ward 7 issues, please visit www.DruhFarrell.ca.
