Make haste while costs down: Mandel
City has paid for failure to build during last downturn, mayor says
Gordon Kent
The Edmonton Journal
Friday, March 13, 2009
Edmonton should take advantage of cheaper prices created by the tough economic times and move ahead with important infrastructure projects, Mayor Stephen Mandel said Thursday.
The cost of construction has dropped as much as 50 per cent from two years ago, with the price of widening and rehabilitating Whitemud Drive alone down about $70 million from earlier estimates, he said in a speech to the Rotary Club of Edmonton.
"We need to move fast to take advantage of these conditions on capital projects, including new federal spending, and spend to speed up some critical infrastructure projects," he said.
"The real lesson of our last downturn was one of the consequences of paralysis, of slow investments that just deferred and increased costs, and how we've been paying for this for the last several years. When times were slow in the '90s, we just decided to cave in and do nothing."
Premier Ed Stelmach said this week he wants to look at borrowing for public works, given the current low interest rates, saying this makes more sense than using cash from the $6-billion capital fund that's still earning high returns.
City councillors agreed in December to borrow about $1 billion over the next three years for the LRT line from downtown to NAIT, three new recreation centres and other major projects.
But Mandel warned in his speech that the city must be careful about raising taxes to pay for more debt in case that slows the local economic recovery.
"I remain nervous about how much we are borrowing, and I think we need to be careful to pace our debt so we're not incurring financing costs until we're ready to spend the money."
Mandel also brought up the City Centre Airport, which the city is looking at closing and putting up for redevelopment, possibly as a new community that could house more than 30,000 residents.
While he won't indicate publicly where he stands, the mayor said the issue must be settled "once and for all" in a discussion that includes looking at the best way to use the site 30 years into the future, not just today.
But with other communities and provincial politicians wading into the debate in the past, he emphasized the issue must be resolved in a way "that is in the best interest of all Edmontonians, and I repeat, to Edmontonians."
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© The Edmonton Journal 2009
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