A Municipal Fiscal Impact Model: Real-World Policy Modeling

This paper presents a summary of work that was done by the civic governments of Calgary and Edmonton that addressed the question of suburban development, infrastructure growth and rehabilitation and their financing given limited funding. In the 1980's and 1990s, Canadian federal and provincial governments became concerned about the state of their respective finances. They responded by introducing a combination of expenditure reductions, tax increases and higher user fees. Consequently, transfer payments to municipalities were reduced. These measures had a profound impact on the economies of the urban regions affecting the rate of renewal and obsolescence in business, residential and public infrastructures. In this context, the Cities have had to decide how to allocate their limited financial resources between competing needs of further suburban development and growth restricted to the already built up areas. But the Cities' financial ability to expand and to maintain their infrastructures are limited.