1. What is annexation?
Annexation is the act of incorporating land from one municipality into another municipality. Annexation does not involve a change in land ownership, simply a change in municipal jurisdiction.
In terms of The City of Red Deer, annexation involves changing the official border of the city to accommodate its growth. This means that some areas that are now located within County jurisdiction would be brought under City jurisdiction.
2. What is the difference between annexation and expropriation?
Expropriation involves a change in land ownership. Expropriation occurs when an owner is obligated to sell his or her land, at market value, to a municipality for the purpose of a specific major project (for example, expansion of a major roadway or the creation of a commuter train and stations within a city).
Annexation does not involve a change in land ownership. Owners continue to own their property, but since the boundary of the city does change, the property shifts from being located in the county to being located in the city. Basically, property owners or tenants would no longer live in the county; they would live in the city.
3. Why did The City need to annex industrial land?
The City needed to annex land from Red Deer County to meet the continuing demand for serviced industrial land. During the last 10 years, the city has experienced significant population growth and economic development. The City’s 10-year population growth rate is at 32 per cent, and manufacturing jobs increased by 37 per cent between 2000 and 2004.
This unprecedented growth far exceeds previous averages and has led industrial land to be absorbed much faster than anticipated: 183 hectares of industrial land have been absorbed and developed since 1995. The 2004 City of Red Deer Growth Study determined there was less than a one-year supply of industrial land available within the city. Since that time, the availability of industrial land for development in the city has been depleted.
Under the Intermunicipal Development Plan (IDP), there is a guideline for The City and County to work together to maintain a 20- to 30-year supply of industrial land within City boundaries in order to accommodate the great deal of planning required for transportation routes, utilities, and services. To stay within the 20- to 30-year supply guideline, The City needed to annex approximately 520 hectares, or eight quarter sections, of industrial land.
4. How long ago did The City annex land from the County?
The City of Red Deer last annexed land from Red Deer County in 2004, primarily for residential development. Prior to that, an annexation occurred in 1996, when land for the current landfill site was annexed. As the 2007 Industrial Annexation dealt only with industrial land, any additional land that will be needed for residential, commercial, park, or institutional development will occur through future annexation applications.
5. Why didn’t The City annex industrial land, along with residential land, in 2004?
The City was researching industrial land annexation options while the residential land annexation was occurring. As early as 2000, The City began conducting a series of servicing and viability studies to determine the best locations for future industrial development. In addition to assessing servicing options, issues, and costs, the various studies also looked at the economic and growth impact industrial land development would have on the region.
The results of all of this research were reviewed and amalgamated in the 2004 City of Red Deer Growth Study. It updated projections established in the 2000 City of Red Deer Growth Study, adjusting the vision and proposed direction for future growth and development within the city based on a future population level of 160,000.
6. What area did The City annex from the County during the Industrial Annexation?
The industrial annexation included eight quarter sections of land from the County that lies west of the Queen Elizabeth II Highway (Highway 2) and south of Highway 11A.
7. Why was this area considered for annexation?
Based on the servicing and viability studies The City conducted and shared with Red Deer County since 2000, this area was considered the most suitable location for future serviced industrial growth. The area has excellent transportation and market access, is highly visible, and offers the highest opportunity to recover development costs over the next 25 years. In addition, this land can be fully serviced by The City of Red Deer with water, sanitary sewer, storm drainage, transportation, and emergency services. It also creates a balanced, functional growth mix within the city.
It is important to note that this is a very long-term investment for The City, and the municipality may not recover all input costs associated with development, including land purchases and servicing, through land sales revenue. However, due to the broader economic benefits associated with serviced industrial land, including new tax and utility revenues, job creation, and the spin-off of new spending in the community, The City feels that providing serviced industrial land as an economic development tool is an important investment to make in the region.
8. What is the annexation process?
The Municipal Government Board (MGB) directs this process and ultimately makes a recommendation on the annexation to the Minister of Municipal Affairs. The process begins when one municipality initiates an annexation proposal with another municipality. Public consultation must then be held with the affected land owners, followed by negotiations between the two municipalities. If agreement cannot be reached, mediation must be attempted in good faith.
Once mediation is complete, whether it is successful or not, the initiating municipality will prepare a report to the MGB, which decides if a hearing is required. If it is required, the timing is dependent on the Board's schedule, as they manage hearings related to annexation, property assessment, taxation, and municipal disputes across the province.
Following a hearing, if needed, the Board will make their decision based on several factors, including how quickly land is absorbed for development, how quickly land is depleting within the municipal boundaries, and the municipality's ability to service the land.
9. What benefits does industrial annexation create for the Central Alberta Region?
Industrial annexation secures land for serviced industrial development, enhancing economic growth and employment opportunities within the region, helping to create a balanced economy, attract new investment and new residents, increase local spending, maintain or expand services, and ensure a sustainable region.
In 2003, it was estimated that between 20 to 25 per cent of Red Deer’s active labour force was employed in current industrial areas of The City. Serviced industrial development is a critical component to a community’s economic activity.
It is estimated that, for every hectare of industrial land developed, approximately:
- 10 new jobs are created;
- six new homes are built;
- an additional $24,000.00 per year is spent in the community; and
- $30,000.00 in annual municipal revenue (for example, tax, utility, and user fees) is generated.
Providing serviced industrial land is expected to result in development that will create approximately 10,000 new direct and spin-off jobs in Central Alberta during the next 25 years. In addition to job creation, serviced industrial land is expected to result in an additional $1.46 billion in spending (present value) over the next 25 years.
This spending will result in the attraction and retention of a wide range of new businesses, retailers, and service providers to the Red Deer region. In addition to increases in economic activity supporting the regional economy, economic diversification helps both The City of Red Deer and Red Deer County maintain balanced residential and non-residential tax bases, a critical element to financial sustainability.
10. What types of businesses develop on industrial land?
There are two types of industrial land districts in Red Deer. One is called the I1 – Industrial (Business Service) District, which allows light industrial. The purpose of this district is to provide for a limited range of light industrial, warehousing, storage, and industrial support services where the operation of these businesses does not create or emit noise, odour, dust, fumes, or any other nuisances beyond the property line. Examples of light industrial currently operating within Red Deer are Daimler-Chrysler and Collicutt Energy in the Edgar Industrial Area.
The second type of industrial land is known as the I2 Industrial (Heavy Industrial) District. This district allows for a wide range of manufacturing, assembling, fabrication, and processing. Nuisance factors such as noise or smoke can be associated with these types of businesses. Red Deer’s Riverside Heavy Industrial Park, where Olymel is located, is one example of a heavy industrial area.
11. How has The City proceeded with developing the annexed land?
The City developed and approved an area structure plan, which determined the location and layout of various land uses, districts, and utilities for the entire eight quarters. This plan required public consultation and adoption by City Council. The area structure plan guides all development, both private and City, in the new industrial area.
Part of The City’s business is acting as a developer of land for industrial purposes. This means that The City develops and services land with the intent to sell it to industrial businesses wishing to locate in Red Deer. As a developer, The City purchases land, completes the planning and design work, then services and subdivides it. Once all of this work is done, The City then markets and sells available building lots.
In the early 1980s, The City acquired and serviced land east of the Queen Elizabeth II Highway (Highway 2), then sold it to a variety of businesses, forming the Edgar Industrial Park.
In addition to developing some of the land itself, The City is working with current landowners and private developers west of the Queen Elizabeth II Highway and south of Highway 11A to facilitate future serviced light industrial development in the entire area.