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AEROTROPOLIS COULD COST $351 MILLION: REPORT
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by
Don McLean
July 8 - 14. 2010 |
A consultant–prepared “financial/economic impact analysis” says it will cost $351 million to service the airport employment growth district (AEGD), but that doesn’t include several key infrastructure elements including sewage treatment upgrades and the trunk sewer and water lines connecting the aerotropolis to the Woodward Avenue treatment facilities 25 kilometres away. The upbeat report argues that the controversial 2,050 acre development will attract nearly 25,000 jobs and produce over $50 million a year in tax ‘profits’ by 2031.
The report says more than half of the $351 million servicing cost could be collected from development charges, and that local servicing supplied by the land developers will cover another quarter of the costs, leaving $42 million in the lap of taxpayers. However, it acknowledges that the city steeply discounts industrial development charges and if that practice continues it will add another $185 million to the taxpayer burden – the equivalent of nearly $14 million a year for the next 20 years.
Almost two–thirds of the $351 million would go to new or expanded roads, with nearly all the rest for stormwater management or the installation of water and sewer pipes. But this doesn’t include the required construction of a major trunk sewer pipe up Centennial Parkway and west along Dickenson Road to Upper James – a project city documents says will cost $125 million. New water pipes from Woodward Avenue will also be required, but are not included in the consultant’s list of aerotropolis costs.
The reason appears to be a decision to only include infrastructure spending that lies inside the geographic boundaries of the 2,050–acre AEGD site. The consultants note that about a quarter of those lands can be serviced using existing city water and sewer capacity, but also don’t charge the cost of those existing services to the aerotropolis.
The analysis also charges nothing for the planned $675 million sewage treatment plant expansion – even though the city contends that half those costs should be paid for by growth. The aerotropolis and a similar–sized future residential expansion in Elfrida are the only boundary expansions currently contemplated by the city to absorb new growth.
The consultant study is enthusiastic about the influence of the airport on the AEGD’s projected success, calling it “a core advantage” in attracting new development.
“The proximity of the HIA [Hamilton International Airport] in relation to the AEGD is a significant asset which enhances the development potential of the area,” says their report. “Major airports have the potential to generate new business and employment that extends beyond their immediate environs. This includes employment lands located adjacent or in periphery of major airports.”
The consultants are enthusiastic about Hamilton’s ability to compete with other southern Ontario cities for industrial development, and upbeat on the potential of “the strategically important employment area” around the airport.
“The AEGD is favourably located in terms of access to major highways, and skilled labour, and offers a developable area of ‘critical mass’ at competitive prices,” concludes the report. “Other major airports in the region, including Toronto Lester B. Pearson International Airport and Buffalo–Niagara International Airport have limited off–site employment land development opportunities, which places the AEGD and HIA in a unique position and highly marketable.”
The report doesn’t comment on the future of over 1,700 acres of other greenfield industrial lands already designated in Hamilton, including 300 in the airport business park that have sat empty for over two decades. It also makes no mention of the costs of losing the highly productive farmland that would be replaced by the aerotropolis, or the current taxes paid by the 4,100 properties within the AEGD boundaries. V
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