Woolwich council has some basic economics at play in making a decision about a new road proposed for Breslau. There’s a cost-benefit analysis to carry out, and there’s the issue of opportunity cost.
With a projected price tag of about $30 million – $26.5 million for construction and another $3.5 million for the likes of design and land acquisition – the so-called Breslau east collector road already bears scrutiny. Just what purpose will it serve? How many people will use it? Are existing routes good enough for connecting the new subdivision?
Putting the issue on hold until a valid need can be demonstrated is a good first step.
The proposed route, with its $15-million overpass, appears directed at a potential future GO station on Greenhouse Road than for local traffic. If so, that would make the road of more use to the region and to Metrolinx than to Woolwich, whose residents are nonetheless expected to pay for it.
Funding would come from development charges – fees applied to new homes ostensibly to help cover the cost of growth – tacked on to all the new homes built in the township once formally approved by council. Based on today’s charges for roads, subdivision developer Thomasfield Homes estimates the buyers of some 5,800 new builds in the township would face an additional $4,500-$5,000 fee on top of the tens of thousands in DC charges already levelled.
Leaving aside the irony of the township and region talking about housing affordability in a time of ever-growing fees, there’s the opportunity cost to consider. That applies not only to removing money from the local economy – every extra dollar a new homebuyer pays is another dollar diverted from other spending – but to the township’s ability to keep returning to the well for yet-more DC money. The $30 million extracted for the Breslau road isn’t the first or the last hit homeowners face.
Just as the township has to juggle spending priorities when it comes to dealing with its infrastructure deficit – there are more projects than there are dollars each year – Woolwich also needs to moderate how much money it lifts from people’s wallets. There is, unfortunately, a tendency to see development charges as free money, funds that can be taken without calling the move a tax increase and without direct budget implications.
At first blush, the connector road – particularly the overpass – fails the cost-benefit analysis: the crossing would be used by too few residents. Even in isolation, spending that kind of money doesn’t make sense. More so when you consider that the township already has a substantial infrastructure deficit measuring into the tens of millions, projects far more pressing than the road and overpass, “free” money notwithstanding.
Woolwich, like every other municipality in the country, is way behind in setting aside money to replace aging roads, bridges, sewers and facilities. It faces an infrastructure deficit of more than $60 million over the next decade for road and bridge work alone.
For years we’ve coasted on the infrastructure built decades ago: we never saved for a rainy day, and now the skies have opened up. The township has too much on its plate to add to the list (or to spend money on non-essential services, but that’s another story).
Mounting expenses apply to all of the infrastructure in the township, from water pipes to municipal buildings. Every government, in fact, has a growing list of things that need repair or replacement. And every government has been bad for years and decades at setting aside enough money to pay for those necessities. Most can’t even get a handle on today’s operating costs, let alone save enough for tomorrow.
It’s in that context that council has to look at spending scarce resources, in Breslau or elsewhere.