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Calgary, Rocky View County pivot from annexation to joint venture

Annexation talks off as county, city partner on logistics hub and rail transload facility
A map of the Shepard industrial corridor, showing in red the area covered by Rocky View County's area structural plan and the gold-striped area of nearly 4,200 acres that Calgary proposed annexing in 2021.

Rocky View County (RVC) council approved a new agreement with the City of Calgary on July 18 to co-develop a new inland logistics hub and rail transload facility along Calgary’s southeast boundary in what is known as the Shepard Industrial Area.

The new city-county joint development will be called the Prairie Economic Gateway Initiative.

“This project has evolved from a traditional annexation process into a joint venture with the City of Calgary,” explained RVC’s director of legislative and intergovernmental services, Amy Zaluski. “It has the potential to create a number of benefits including economic development, improved regional relationships, strong private partnerships, and an innovative approach to cross-boundary development.”

Zaluski went on to remind council the project was born out of the annexation process launched by the City of Calgary in late 2021. As county and city representatives met to negotiate a settlement agreement for the eventual annexation, those representatives realized more could be gained by working together to co-develop these lands instead.

“During the course of that negotiation, the (annexation) committee decided to explore alternate means to develop and achieve mutual benefit rather than a lengthy and costly annexation process that could delay development for a number of years,” she confirmed.

The county had already done much of the groundwork to develop the Shepard Industrial Area into a new industrial park prior to entering into the annexation talks with the Calgary. As part of the new joint development initiative for these lands, the annexation process is now paused.

On July 18, RVC staff asked council to approve motions on four elements of the Prairie Economic Gateway Initiative.

The first was to approve the terms of reference for founding a new co-development committee which would have representatives of both the City and County sitting on it.

The second was to sign a formal letter of intent agreeing to the creation of the Prairie Economic Gateway Initiative to explore economic opportunities in the Shepard Industrial Area to the mutual benefit of both municipalities in partnership with private developers, in this case mainly with Simpson Ranching Ltd. of Shepard Development Corp.

Staff's third ask was to pause the work of the annexation committee and re-assign RVC’s current representatives to the new Prairie Economic Gateway Initiative Committee instead.

And finally, staff asked council to agree to transfer $785,000 from the County’s reserves to help pay for a project management consultant and other start-up costs associated with the new initiative.

Division 2 Coun. Don Kochan asked staff if the City of Calgary would also be putting in $785,000 to pay for those start-up costs. Zaluski said the city's contribution at this point for the joint management consultant would be equal.

“So if we put in $225,000 for that consultant, they will pay the other half,” she said. “They won’t necessarily be putting in the same dollar amount as us because this ($785,000) is our estimate for the internal resources we are going to need. But they are also going to be (funding) their internal resources.”

Kochan also asked if the developer would be paying for some share of the project consultant and initial development fees.

“Part of the opening stages of work with the joint consultant will be to work out a Memorandum of Understanding with the developer so we can understand exactly who is doing what and who is contributing,” Zaluski confirmed. 

It was also important to strike while the iron was hot, added Rocky View County CAO Dorian Wandzura, lest the opportunity be lost. He explained the developers were hoping to have a new Area Structure Plan (ASP) in place and a firm agreement in hand with Canadian Pacific Kansas City rail by 2024, after their previous county-led ASP process had been truncated by annexation negotiations with Calgary over the past two years.

“This is no doubt...a fast moving project,” Wandzura said. “There is a desire to have this (Shepard Industrial Area) ASP in place by the spring of 2024, and that speed is reflected in the effort we are putting in here. For developers, time is money. We think there is an opportunity here with CPKC and the developer – that time slipping away might lose this opportunity.”

Division 6 Coun. and Deputy Reeve Sunny Samra then put forward the four motions required to approve the letter of intent, the terms of reference for the new joint committee, the approval of the transfer of existing annexation committee members to the new joint committee, and the updated budget request of $785,000. 

All were approved unanimously.

Division 1 Coun. Kevin Hanson, who also serves as vice-chair of the Calgary Metropolitan Region Board, said he was thrilled the County had embraced this joint effort with the City of Calgary, adding he hopes it will mutually benefit both municipalities.

“I am really excited to be able to support this,” he said. “I think it is quite a different way of doing business with a little more collaboration in the region. So hopefully this turns out well for us.”