CALGARY: MEETING POPULATION GROWTH

THINGS ARE DIFFERENT in Calgary, Alberta. The city of more than one million is putting together a pipeline of several projects, one of which is in the advanced stages of planning and may be tendered soon.

It all starts, though, with the need. The city's population has swelled by some 500,000 in the last 20 years, thanks in part to the oil and gas boom that drew people to Alberta in search of jobs.

"It's pretty difficult to keep up with growth at that rate without incurring a lot of debt or raising taxes, neither of which we wanted to do," says Calgary deputy Treasurer Rick Masters.

So in 2007 the city began exploring PPPs as an alternative form of project procurement. The goal was to establish a "working document" that could "survive" changes in city councils and give Calgary a set of policies to point to in pursuing projects, Masters says.

Council approved the policy framework in 2008 and, in 2009, Calgary identified its first PPP candidate. "With the city's growth, we had a need for emergency response facilities," Masters says. "The traditional way of building these things is one at a time and we thought PPP might work as a model to help deliver these things much faster."

The city thought they'd need up to seven fire stations plus a headquarters building. But with a slow-down in Calgary's growth, and a value for money analysis that was "kind of neutral", Masters says it made sense to shelve the project.

"We felt that as our first PPP we wanted to have a very strong value-for-money," he says.

The fire hall project may still be resurrected in an amended form. Meanwhile, Calgary is moving ahead on three other projects: a PPP for recreational facilities, a maintenance station for its transit system and a performing arts centre.

Only the PPP for recreational facilities was "advanced" enough to submit to PPP Canada for funding, Masters says. "But there was an opportunity to get some useful feedback," he adds, so Calgary submitted the other two as well.

The logic behind the recreational facilities was the same as with the emergency responses: the city had grown in size and needed multiple buildings of the same type. In this case, two large and two small multipurpose recreation centres equipped for swimming, hockey, indoor soccer and the like.

"It can take up to ten years to deliver each one of these and we needed four so, again, we thought we had an ideal PPP candidate," Masters says.

Pending approval from a newly elected city council, the project, budgeted at $300 million in capital cost, could be opened up for bidding in 2011.

"We're optimistic that we can move this forward," Masters says.

The maintenance station for the city's bus feet is a project that may go to RFQ in 2010 and could cost around $100 million. "It's something that's identified as a need but not an immediate need," he says.

Likewise, the renovation of Calgary's EPCOR Centre for the performing arts could top $100 million. "It was designed for a city almost half the current size," Masters says. The scope of the renovation is just being worked out and will be further refined pending an expression of interest from the industry.

If all these opportunities materialise, they may well lay the tracks for Calgary's biggest PPP opportunity: a 15-kilometre extension of the city's light rail-transit system to serve southeast Calgary. At a total cost of at least $1.5 billion, it would easily top the charts as the city's largest and most complex PPP.

"I would say that realistically it's several years off," Masters says. Nevertheless, "we're starting our discovery stage as a PPP", he adds.