Fixing Edmonton’s Maintenance Problem & Protecting Mature Communities: Edmonton’s New Dedicated Renewal Fund

Last week, City Council voted to advance the creation of a Dedicated Renewal Fund, a long-term solution to a problem that’s been creeping up on Edmonton for years.

At its core, this fund is about protecting the roads, rec centres, parks, pools, fire halls, transit, and community spaces we rely on every single day. Our infrastructure and assets are the foundation of daily life, and this fund will help ensure valued amenities are maintained and renewed for generations to come.

 Mind the Gap - Chronic Underfunding of Renewal

Despite having over $34 billion worth of infrastructure and assets, right now, Edmonton is only funding 54% of what is needed to maintain and renew them.

Chronically underfunding renewal has resulted in a $480 million annual gap. Beyond being a number on a balance sheet, this gap affects both the long-term fiscal health of our city and the livability of our communities.

Older, more established neighbourhoods have already begun feeling these effects: some facilities face closure threats, repairs are deferred, and residents sense their communities are being overlooked.

Not Flashy, But Vital - Why the Dedicated Renewal Fund Matters

New projects and ribbon cuttings usually get a lot of attention, but focusing on maintaining and renewing our existing city assets is a critical part of building stable, sustainable, and attractive communities that will be great places to call home for generations to come.

That’s why I have been pushing for the creation of a Dedicated Renewal Fund throughout my term on Council. Now, I am thrilled to see it moving forward. 

Ensuring a consistent and appropriate level of renewal investment is imperative to keeping City assets in safe, usable condition. Many local pools, parks, and transit centres were built decades ago. With a dedicated source of funding, we can repair a failing boiler or a leaky roof proactively before it forces a closure.

This approach replaces piecemeal fixes with planned upgrades, preventing costly emergency repairs down the road. Not only does it spread out the tax burden in small, predictable increments, it provides future councils with reliable tools to maintain critical services. 

By acting now, we can spare future Edmontonians from both higher costs and bigger headaches. It’s a clear, long-term solution that outlives four-year budget cycles.

Short-Term Gains, Long-Term Pain: The True Cost of Deferred Maintenance

Temporarily lowering taxes by failing to plan for routine asset upkeep only kicks the can down the road, resulting in higher taxes for future councils and residents. In reality, it doesn’t save money; it simply pushes expenses into the future. Worse yet, neglect accelerates deterioration, increases operational expenses, and invites more unpredictable, and more expensive crises.

Many North American cities have succumbed to this pattern, offering artificially low tax rates while renewal needs balloon in the background, leaving taxpayers on the hook for urgent, high-cost repairs. Although some argue that dedicating funds for upkeep “handcuffs” future councils, the real handcuffs come from underfunding maintenance now and adding new assets without a sustainable plan to pay for their upkeep.

Unfortunately, election-cycle incentives often fuel this pattern, allowing leaders to boast low taxes, even as maintenance costs quietly multiply.

How We Got Here

Edmonton didn’t arrive at a $480 million annual renewal gap overnight. For decades, our city expanded outward while also juggling limited revenue tools and inconsistent funding. These factors compounded over time, contributing to the infrastructure challenges we face today.

Decades of Low Density Sprawling Expansion

Every time a new neighbourhood is approved at the edge of the city, we commit to roads, utility lines, and public facilities that all need upkeep in the long run.

Rapid, low-density growth outpaced our ability to maintain existing infrastructure. When more roads and amenities are added faster than we can fund their upkeep, it results in older areas getting squeezed, and brand-new communities becoming tomorrow’s maintenance backlog.

Part of Edmonton’s suburban financial equation is that developers build most new suburban roadways, but ultimately, the City inherits them. When the bill comes due, property taxpayers throughout the rest of the City have to pay.

Looking at roads alone, Edmonton has over $12 billion worth of roadways, one of the highest lengths of road per person among major Canadian cities. This translates into hefty long-term maintenance obligations, from filling potholes to full rebuilds every 40 years.

I have written at length about the need to rein in our sprawling growth patterns by building in and up, which you can read about here.

Limited Revenue and Funding Tools

Municipalities in Canada own about 60% of public infrastructure but collect only around 10% of the tax revenue.

Funding from higher orders of government can be inconsistent, often tied to new projects rather than routine upkeep. Cities have grown in size and complexity, but their revenue streams have not kept pace.

Because Edmonton can’t always rely on stable external funding for maintenance, the financial load for roads, facilities, and public spaces falls heavily on limited municipal tax dollars. This mismatch between growing needs and modest local revenues directly widens the renewal gap.

Short Term Budget Decisions and The Illusion of Low Taxes

Many municipalities, aiming to minimize immediate tax burdens, choose minimal tax increases—providing short-term relief, but masking the true cost of running a large, geographically spread-out city. By postponing or underfunding upkeep, mounting repair bills are shifted onto future taxpayers, ultimately expanding renewal gaps over time.

A leaky roof, failing boiler, or crumbling facility doesn’t get cheaper with neglect. Delaying critical repairs may look fiscally prudent initially, but it often leads to bigger, costlier crises down the road.

Phasing in the DRF

Council adopted a plan for gradually increasing renewal funding without imposing a single, large tax hike. From 2025 to 2029, modest annual tax increases will first be used to refill Edmonton’s Financial Stabilization Reserve (the “Rainy Day Fund”) and Pay-As-You-Go (PAYG), both of which are below their minimum balances and have requirements to be restored.

Starting in 2029, those same incremental tax dollars will shift into the new Dedicated Renewal Fund. Because we’re also introducing successive incremental tax increases each year, the DRF will grow steadily, taking up to twenty years to fully meet the City’s renewal needs (similar to the phasing in of the Neighbourhood Renewal Program).

In response to a motion passed on March 18, 2025, there’s a plan to ramp up these annual increases from 0.5% to 1.0% by 2033, ensuring we reach full funding faster. This approach spares taxpayers from sudden rate spikes while guaranteeing a long-term, stable source of funding to maintain roads, facilities, and other vital infrastructure.

A Strong Foundation for Everyone

With the introduction of a Dedicated Renewal Fund, we’re ensuring that older neighbourhoods, and really the entire city, get a fair shot at staying vibrant and functional.

I’m proud to have championed this work and to see it finally come to life. Our communities deserve the peace of mind that comes with knowing the rec centre or library around the corner will still be there for the next generation. Now, we have a roadmap to make sure that happens.

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Background Motions

On June 7, 2022, at the Operating Investment Outlook, I moved: 

That Administration return prior to the 2023-2026 Operating and Capital budget deliberations with options for a new dedicated tax levy to address funding challenges for the City’s renewal program, including but not limited to funding either general renewal needs or a specific component of the renewal program.

This made it an option at the 2022 Fall Budget, but unfortunately it was not supported at the time, so on June 13, 2023, I made the following motion:

That Administration, as part of the Fall 2023 Supplementary Budgets, provide options to fund the introduction of a new multi-year Dedicated Renewal Fund, including but not limited to, potential successive annual tax levy increases.

Unfortunately, it was also not supported at the Fall 2023 supplementary budget. However, in Fall of 2024 as part of the repayment strategy for the Financial Stabilization Reserve (Rainy Day Fund), and Pay-As-You-Go replenishment, I worked with Mayor Sohi to pass the following motion:

That Administration provide a report with a draft strategy to replenish the cumulative impact of the $15,000,000 reduction in annual Pay-As-You-Go and establish a Dedicated Universal Renewal Fund aligned with the following principles:

• Repayment of the cumulative impact of the $15,000,000 reduction in annual Pay-As-You-Go by 2030.

• Redirection of tax levy funding used to replenish the Financial Stabilization Reserve once the minimum balance is achieved.

• Incorporation of dedicated tax levy increase of successive 0.5% in 2027 and beyond to meet the draft strategy.

The report indicated that 0.5% successive increases alone would never fully fund the strategy, and that in future years, higher rates of funding would be required. On March 18, 2025, I moved the following motion:

That the strategy to replenish the cumulative impact of the $15,000,000 reduction in annual Pay-As-You-Go and establishment of a Dedicated Universal Renewal Fund, including an increase to the dedicated tax levy of 0.5% in 2030 to 0.75% from 2030 until 2032, and to 1.0% in 2033 and beyond to achieve target funding levels set out in Attachment 3 of the November 1, 2023, Financial and Corporate Services report FCS02052, as outlined in the March 18, 2025, Financial and Corporate Services report FCS02818, be approved.