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City council needs to come clean on the costs of its green dreams

Appeared in the Vancouver Sun
Authors:
Release Date: September 23, 2011
Vancouver’s Vision-dominated city council has never made any secret of its desire to turn the city into an environmental paradise. And with the recent introduction of its Greenest City 2020 Action Plan, Vancouverites now have a clearer picture of city council’s grandiose plans for greening the city.

While some of the goals and policies included in the plan are admirable, the plan fails to provide any information on its costs. And when politicians start extolling grand visions without talking about the costs, taxpayers are well advised to hang onto their wallets.

The reality is, the Greenest City 2020 Action Plan will impose significant costs on Vancouverites and therefore, city council needs to conduct a complete cost analysis so Vancouverites know their money isn’t being wasted on expensive green dreams.

The Greenest City 2020 Action Plan sets out 10 environmental goals, each with associated targets, for the city to achieve by 2020. The goals range from “securing Vancouver’s international reputation as a mecca of green enterprise,” to “having the best air quality of any major city in the world.”

Some of the targets are terribly misguided. For example, one target is to double the number of green jobs in the city by 2020. However, green jobs are incredibly expensive to create and sustain. According to the CD Howe Institute, some of Ontario’s green job policies result in a cost of around $179,000 per job. Furthermore, research on the European experience suggests that each green job created through subsidies results in the loss of two or more jobs elsewhere in the economy.

Other targets are more admirable, such as the proposal to meet the strongest drinking water quality standards and guidelines. But depending on the cost required to reach this goal, Vancouverites may not be willing to pay for it.

The plan proposes a mixture of policies, including regulations (e.g., bans, zoning), de-regulation, moral suasion, subsidies, monopoly power (e.g., district energy systems), information disclosure, price signals, quantity restrictions (e.g., less car lanes), among others.     

Some of these policies are well thought out and even potentially needed. For example, to help meet an overly ambitious greenhouse gas reduction target, the plan proposes diverting compostables from regular garbage pickup to a special processing facility. Although costly, this policy is expected to reduce landfill methane emissions (a greenhouse gas with possibly 20 times the warming potential of CO2) which are currently exempt from the British Columbia carbon tax.  

Other examples of interesting policies contained in the plan are road pricing, market pricing for city parking, water metering on all new housing, and removal of parking requirements for new buildings. Removing regulations and introducing better pricing mechanisms will allow Vancouverites to collectively use resources, such as street parking or tap water, more efficiently.

However, the majority of proposed policies are inefficient mechanisms that limit individual freedoms and will likely lead to additional costs for Vancouver residents. For example, creating a ‘Green Economic Zone’ is burdensome on businesses and individuals by further directing where particular types of businesses are not allowed to set up shop. Other examples of inefficient policies are subsidizing a local food “incubator,” subsidizing electric vehicle charging stations, reducing car lanes, and bi-monthly garbage pick up.

While a few of the proposed policies raise revenue, the majority will either cost the city money or impose additional costs on individuals and businesses.

The plan claims that many of the policies can be implemented under current city operating budgets. However, what is not mentioned is that implementing these policies will divert resources away from current uses; think libraries, sewer maintenance, etc.

Also, projects requiring a substantial outlay of cash, such as setting up a district renewable energy monopoly, will be brought to council for a vote. In such cases one would hope that a full cost analysis will be done on the project in question.

Either way, it is painfully clear that the Greenest City plan will result in higher city expenditures as well as the diversion of existing city resources from current uses. And higher city expenditures mean higher taxes for property owners and businesses.

The process of setting hugely ambitious goals while ignoring the costs of achieving these goals is a poor way to set public policy. It may be that many of these goals will be excessively costly to the city, businesses, and individuals. A situation could easily develop where council members focus more on meeting the goals for political reasons while ignoring the overall fiscal ramifications of the plan, i.e., trying to reach their own goals outlined in the plan but with your tax dollars.

Policy goals should only be set if the benefits outweigh the costs, and nowhere in the 162 page Greenest City 2020 Action Plan is the appropriate analysis done. Setting goals with only the benefits in mind is utterly misguided and will result in increased city expenditures and impose large costs on Vancouverites. Council should reconsider its plan and conduct a complete cost accounting so Vancouverites know what the plan will cost and whether taxpayers can afford it.


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