The infrastructure bill for sprawl is much higher than for apartments
Alex Hemingway and Danny Oleksiuk
Worried about Infrastructure Costs? Then End the Apartment Ban. Alex Hemingway and Danny Oleksiuk, Canadian Centre for Policy Alternatives / Sightline, January 2025.
The article observes that infrastructure costs are much lower for higher-density housing (like apartments) compared to lower-density housing (like suburban-style single-detached houses). Making it difficult to build apartments, and pushing development outward - like pushing down on a balloon - results in a bigger infrastructure bill.
A 2013 graphic based on data from Halifax:
The article discusses funding:
Of course, new infrastructure has to be paid for. Cities typically pay for their infrastructure investments through a mix of property tax revenue, debt financing, funding from senior governments and (increasingly) ever higher fees levied on new housing construction.
The provincial and federal governments can play an important role by providing more funding to close the infrastructure gap and promote efficient urban housing creation. This funding should require an end to apartment bans, especially in expensive central cities like Vancouver.
The good news is that the incoming BC NDP government committed in its election platform to create “a new local infrastructure investment fund that’s tied to housing starts, while offering more flexibility to cities exceeding those targets.” And the provincial Ministry of Housing now includes the municipal affairs portfolio, which could help in this effort. But details are scant, both in terms of the level of funding to be provided and the structure of the conditions on that funding.
The Union of BC Municipalities has asked for an additional $650 million per year for infrastructure, which may be a good place to start. Provincial revenue could be raised for increased infrastructure funding by taxing even a sliver of the huge increase in land wealth seen in BC in recent years.
The federal government also recently created a $6 billion Canada Housing Infrastructure Fund. The funds come with some good conditions relating to zoning reform and limiting fee increases on new housing, but they notably do not include a requirement to end apartment bans. This federal initiative is a positive step, but the level of funding is manifestly inadequate, given that it is spread over 10 years and an entire country.
Still, municipalities—and in particular big, expensive cities—are far from helpless when it comes to funding infrastructure investment. Cities like Vancouver and Burnaby have among the lowest property tax rates in North America (which encourage speculation in the housing market and entrench wealth inequality). They could increase property taxes to help cover the costs of infrastructure upgrades with a simple policy change. Even better would be to tax land value specifically and add progressive tiers to the property tax system (which would require provincial permission).
The municipal perspective
A very interesting comment from Reddit:
I feel like I’ve spent most of my working life trying to fund infrastructure projects. While the article is absolutely right - density makes infrastructure more cost-effective - it does gloss over political issues, which are an inescapable part of infrastructure funding.
Infrastructure funding often comes down to a sequencing thing. Let's say my Official Communitiy Plan says that we want to densify an area, but that it would require replacing (not installing new) a mile worth of trunk main.
So my funding options look like:
1) hope a developer buys land in the target area and front-ends the cost, hoping to be repaid by latecomers. Even with the new 15 year horizon on latecomers, that can be very risky for a developer using borrowed money. Developers do long infrastructure runs for new projects, but replacing existing infrastructure is much more expensive and much, much riskier.
2) have the muni front-end the cost, and hope developers move in. That's politically terrifying. In a small place with limited reserves, I’m borrowing, so I need to go to the electors. Duck that. Alternatively, I’m taking from reserves, and upping taxes or fees to rebuild the reserves, which gets the inevitable shitty “gargantuan $110 a year tax increase because of infrastructure run amok” news stories that my council hates.
3) I write a dodgy DCC bylaw and sneak the project in, hoping the Inspector reviews it on a Friday. Assuming I sneak that by the goalie, it's a politically low risk maneuver. I'm not going to the electors or raising my requisition, so my Council doesn't feel heat. But the downside is that unless there's development elsewhere in the community, I'm not collecting DCCs. Or it might get punted back by the Inspector. And DCCs are the new betes noir for the chattering classes.
4) hope and pray that we get a senior government grant. Which is what we normally end up doing.
I know it's easy to say that councils should just bite the bullet and raise taxes. But that's really politically tough to do, and in this wonderful world, even relatively small tax increases are heavily publicized and extremely unpopular. We've had threats at the counter this month for a $110 increase. It's tough to expect Councilors to deal with that for a part time job that pays $13 an hour. Not to mention that if they tax too much, they’ll just be defeated and replaced by Team Crazy.
It's a good article and I don't disagree with the conclusions, but senior governments really need to look at the tools for funding infrastructure upsizing, and give munis better options.
Now this is actually something to highlight. Not so much the number, but the way Alberta levies their off-site levies versus how Ontario levies their DCs.
Edmonton's OSLs are levied on a per hectare basis. So a single home on a hectare of land would pay the same total as a 100 unit apartment. This is an appealing incentive to add more units - you're spreading the flat cost over more doors.
Per unit charges, like in Ontario, do the opposite. In Ontario, the home on 1 ha will pay the same DC as each of the units in the 100 unit building. So there's less of a push to increase density.
Edmonton's OSLs are also incredibly low, but I wanted to highlight the difference in per hectare versus per unit charges.
Critical Analysis: “Worried About Infrastructure Costs? Then End the Apartment Ban”
This article highlights the economic advantages of ending apartment bans to address infrastructure costs but misses a critical aspect: the integration of social infrastructure, particularly schools, into densification efforts. While densification is essential for efficiency, systemic dysfunction persists due to siloed planning and the absence of cohesive frameworks that tie urban development to educational infrastructure.
1. Social Infrastructure and Densification: The Missing Link
1.1 Lack of School Integration in Densification Plans
The article emphasizes the need to end apartment bans but fails to address how densification, without concurrent investment in schools, leads to overcrowding and community discontent.
Dunbar Village and QEA:
Dunbar Village is set to densify under the city’s plans, but the closure of Queen Elizabeth Annex (QEA) directly contradicts the need for accessible schools in walkable, family-friendly neighborhoods. Closing QEA not only removes a critical community resource but also forces children into schools farther away, undermining livability and sustainability goals. Parents have taken the VSB to court—learn more here.
Oakridge Park:
As one of Vancouver’s largest developments, Oakridge Park projects thousands of new residents without including school spaces. Neighboring schools like Jamieson Elementary and Churchill Secondary are already at capacity, and the absence of a school integration plan reflects a systemic failure to align urban growth with community needs. Contact Quadreal here.
1.2 Fleming Elementary: A Case Study in Misalignment
Fleming Elementary exemplifies how systemic dysfunction in social infrastructure planning undermines equity and livability:
Despite operating at 107% capacity, a portion of Fleming’s land was leased for a mere $7,000/month over 99 years. This shortsighted decision prioritizes short-term revenue over long-term community needs and restricts the school’s ability to expand to meet future demands.
2. Systemic Dysfunction in Governance and Planning
The article’s failure to address systemic governance issues highlights a critical gap in its argument. Densification is not inherently efficient unless paired with proactive, integrated planning.
2.1 Reactive Decision-Making
Vancouver’s governance structures encourage reactive planning, where schools are built—or closed—only after housing developments materialize. This approach leaves communities underserved for years, as seen in Oakridge Park and Dunbar Village.
2.2 The Vancouver Charter and Funding Limitations
Unlike every other city in BC, Vancouver is constrained by the Vancouver Charter, which prohibits school site acquisition charges. This legal limitation prevents the city from raising funds directly tied to educational needs, deepening the misalignment between housing and school planning.
2.3 Siloed Planning Across Stakeholders
The absence of collaboration between municipalities, developers, and school boards creates a fragmented approach. For example, developments like Oakridge Park proceed without input from the Vancouver School Board (VSB), leading to predictable overcrowding in adjacent schools.
3. Solutions: A Vision for Integrated Social Infrastructure
To address the systemic issues highlighted above, we need a Developers for Schools Program (DFSP) that offers a transformative framework for tying densification to social infrastructure investments.
3.1 Framework for Integrated Development
Developer Contributions for Schools:
Require that a portion of developer contributions be allocated specifically for schools and daycare facilities within or near new developments.
Shared-Use Facilities:
Incorporate multipurpose spaces, such as daycare centers, libraries, and recreational areas, within schools to maximize land use and foster community cohesion.
Density Bonuses for Social Infrastructure:
Provide developers with expedited approvals and increased density allowances in exchange for funding or building school spaces.
3.2 Leadership
Mayors need to lead boldly, ensuring schools are prioritized in every development decision.
3.3 Address Legal and Policy Gaps
Amend the Vancouver Charter:
Advocate for changes to allow school site acquisition charges, enabling Vancouver to fund educational infrastructure in step with urban growth.
Align Zoning and Enrollment Projections:
Mandate that the VSB and City of Vancouver collaborate on enrollment projections tied to zoning changes, preventing closures like QEA that contradict future population trends.
4. Conclusion: Densification Without Schools Is a Failure
While the article effectively argues for ending apartment bans to reduce infrastructure costs, it overlooks the critical role of schools in creating livable, equitable urban communities. As developments like Oakridge Park and Dunbar Village illustrate, the absence of educational infrastructure planning perpetuates systemic dysfunction and undermines the benefits of densification.
To break this cycle, bold leadership is needed to integrate housing and social infrastructure through frameworks like the Developers for Schools Program, ensuring that every densification effort supports thriving, family-friendly communities.
We’re a sprawling country.