Proposed Annexation

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 PROPOSED ANNEXATION

by the TOWN OF DRAYTON VALLEY

 

1. A.   INTRODUCTION

 The Town of Drayton Valley (the “Town”) is seeking to annex 4,665 hectares of land

within Brazeau County (the “County “) as set out on the map attached to the Notice of

Proposed Annexation (the “Expansion Area”), in order to meet its growth requirements

for the next 50 years. The existing area of the Town is approximately 1,307 hectares.

The Town has a population of approximately 7,000 people with a population density of

one person per 0.19 hectares. The existing area of the County is approximately

310,181 hectares. The County also has a population of approximately 7,000 people

with a population density of one person per 44.06 hectares.

 

1. B.   REASONS FOR THE PROPOSED ANNEXATION

 In recent years, there has been significant growth in the fringe area surrounding the

Town (the “Fringe Area”)1 as evidenced by the number of applications referred to the

Town by the County pursuant to the now repealed lntermunicipal Development Plan

(the “IDP”) [Volume 2, Tab A.1] and the planning currently being undertaken by the

County for the entire Fringe Area [Volume 2, Tab A.2]. The Town is becoming

increasingly more “hemmed in” by County development. With the County’s plans for the

Fringe Area, the Town anticipates that it will be completely encircled by County

development within a relatively short time frame, leaving it with nowhere to grow.

While not within the current Town boundaries, development in the Fringe Area is closely

linked with the development pattern and economic and social activities of the Town.

Through various agreements between the Town and the County, the Town is already

providing municipal services to developments in the Fringe Area [Tabs Volume 2, Tab

A.3] . In light of this, the current boundary between the Town and County is artificial in

that the Town and the development in the Fringe Area really function as one

community, described as the Drayton Valley urban community.

The Town proposes to expand its boundary to merge the Town and the Fringe Area

under a single municipal government that would manage municipal services,

development, and land use for the entire Drayton Valley urban community. The

Expansion Area includes the Fringe Area plus some additional land to the west for long

term future growth. The result would:

1. Provide an adequate supply of land for future residential and business

growth in the Drayton Valley urban community;

1 The lOP defined the Fringe Area generally as the area within 1.6 km of the Town’s boundaries except to

the east where the boundary is defined by the North Saskatchewan River.

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2. Incorporate the growth in the Drayton Valley urban community into a

logical and properly planned context;

3. Allow for the extension and provision of municipal services and

infrastructure to the Drayton Valley urban community in a consistent and

properly planned manner;

4. Provide a framework for the most effective delivery of municipal

government services to the residents and businesses of the Drayton

Valley urban community and alleviate inefficiency arising from two

municipal governments providing different or overlapping services within

the Drayton Valley urban community;

5. Create a stronger and unified economic unit to attract new businesses,

jobs and services to the Drayton Valley urban community.

 

   c. HISTORY

 There is a long history between the Town and County with respect to annexation. In

2001, the Town and County entered into an agreement whereby the Town annexed 473

hectares of land (the “2001 Annexation Agreement”) [Volume 2, Tab A.4]. As part of

the 2001 Annexation Agreement, the Town and County entered into the lDP. Within a

few years of the 2001 Annexation Agreement, the Town and County found themselves

back discussing further expansion of the Town. These discussions continued for many

years and included discussions with a facilitator/ mediator. Ultimately, the County

suggested to the Town that discussions cease and that the Town submit a formal

annexation application. The Town followed this course. There have been subsequent

attempts at negotiations but the parties have been unable to come to any agreement.

The Town remains willing to continue discussions; however, the County is not prepared

to do so.

During this time frame, the County unilaterally withdrew from the lDP. The parties have

had some discussions about entering into a new IDP, but again, have been unable to

make any significant progress. Very recently, the County provided the Town with a

proposed new Municipal Development Plan (the “Proposed MDP”) that contemplates

significant development in the Fringe Area and three proposed new Area Structure

Plans (the “Proposed ASP’s”) that essentially cover the entire Fringe Area and surround

the Town.

It is regrettable that the Town and County have not been able to reach an agreement

with respect to expansion of the Town and that there is no longer a joint plan in place

with respect to the Fringe Area. The MGB, however, provides a mechanism for dealing

with circumstances such as the present case where the parties are unable to reach

agreement. The Town’s strong preference would have been for a negotiated

agreement with respect to annexation that included a new IDP. However, despite its

best efforts, the Town was not able to achieve this outcome. As a result, the Town filed

this annexation application.

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1. C.   SUMMARY OF EXPERT REPORTS

 1. Mackenzie Associates Consulting Group Ltd. [Volume 2, Tab B.1]

(a) Population Projection

The Town’s long term growth needs were evaluated over a 50 year period.

The current population of the Drayton Valley urban community (Town and

Fringe Area) is approximately 9,000 residents. From 2001-2006, the

population of the Town alone increased by an annual rate of 2.64%.

There are no statistics upon which to base the growth rate in the Fringe

Area; however, based on aerial photographs, it appears that most of the

residential development in the Fringe Area occurred after 1996. While this

growth has occurred within the County, given its proximity to the Town, the

residents of this development are socially and economically connected to

the Town. The Town’s Municipal Development Plan is based on an

annual growth rate of 2.5%, which is slightly less than the actual growth

rate from 2001 to 2006. Using this growth rate of 2.5%, over a 50 year

time frame, the population of the Drayton Valley urban community will

grow to approximately 30,000 residents. This growth is consistent with

the growth over the past 50 years during which time the population in the

Drayton Valley urban community more than quadrupled [Volume 2, Tab

A.5].

(b) Growth Requirements

 (i) Residential – Based on the population projections, the

Drayton Valley urban community will require land to

accommodate approximately 22,000 additional residents

over the next 50 years. Between undeveloped land and land

that could be redeveloped within the current Town boundary,

the Town could accommodate an additional 7,500 residents,

meaning that the Expansion Area will have to accommodate

an additional 14,500 residents. Using the existing ratio of

2.6 people per dwelling unit, an additional 5,652 dwelling

units will be needed. Based on 10 dwelling units per

hectare, 565 hectares of land would be required to

accommodate these residents. At least a further 20% of the

gross residential development area” would be needed to

provide for supporting uses, such as schools, parks and

institutional uses for a total residential land requirement of

approximately 680 hectares.

2 Under Sections 662 and 666 of the Municipal Government Act (UMGA”), upon subdivision, a municipality

can acquire up to 30% of the land being subdivided for roads and utilities and a further 10% as

municipal and/or school reserve.

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 (ii) Industrial and Commercial – Current ratios of industrial and

commercial land use to population in the Drayton Valley

urban community are as follows:

(A) Industrial (excluding heavy industrial) – 54.86 people

per hectare

(8) Commercial – 63.80 people per hectare

Using these ratios, the Drayton Valley urban community will

require an additional 390 hectares of industrial land and an

additional 335 hectares of commercial land over the next 50

years for a total requirement of 725 hectares. Within the

current Town boundary, there are approximately 170

hectares of land available for industrial and commercial

development, which leaves a requirement for 555 hectares

within the Expansion Area. This land requirement must be

increased to take into account that only approximately 70%

is useable as commercial or industrial development with the

balance required for local circulation, roads, utilities, well

sites, pipelines and buffers. There are currently 22 hectares

of industrial and commercial land in the Expansion Area.

Applying the 70% factor to the remaining 533 hectares

results in a total land requirement of approximately 760

hectares.

 

  (c) Proposed Expansion Area

 Approximately 2,500 hectares of the Expansion Area is not available for

future urban development. These areas are either undevelopable (river

valley, streams, setbacks), fragmented due to existing land uses, used for

road allowances or highways or used for oil and gas facilities. The result

is that only 2,100 hectares of the Expansion Area is available for future

urban development.

Over the next 50 years, the Drayton Valley urban community will require

approximately 1,440 hectares of land in the Expansion Area for projected

residential and commercial/ industrial land requirements. In addition to

this amount, the Mackenzie Report recommends that an allowance of 60%

of the actual land required be provided in order to ensure that a sufficient

supply of land is available to provide for the proper functioning of the land

development market. This allowance would add a further 870 hectares for

a total land requirement of approximately 2,300 hectares, which is slightly

more than the available land in the Expansion Area.

 

  (d) Future Land Use Concept

 The proposed future land use concept is set out at Figure 9 of the

Mackenzie Report. The proposed long term urban structure for the

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Drayton Valley urban community is set out at Figure 10 of the Mackenzie

Report.

2. Corvus Report [Volume 2, Tab 8.2]

(a) Servicing

As set out in the Corvus Report, the Town already provides services to

parts of the Expansion Area pursuant to existing agreements between the

Town and the County. The Corvus Report sets out the plan for servicing

of the Expansion Area. This plan was developed in consultation with the

Town’s engineers and its consultants, ISL Engineering Services Ltd.

(b) Capital Plan

The Corvus Report sets out the anticipated capital infrastructure

requirements for the Drayton Valley urban community (including the

Expansion Area) over the next 25 years. These requirements can be

funded through a combination of reserve and tax levy financing,

debentures, grants and developer financing. Debentures will not exceed

municipal borrowing limits.

(c) Operating Plan

The Corvus Report sets out the operating plan for the Drayton Valley

urban community (including the Expansion Area) over the next 25 years.

(d) Tax Impacts

The Corvus Report sets out the total tax requirements taking into account

the net cost of operations (after revenue and recoveries), capital tax

allocations and tax requisitions. The impact of the taxation on the Town is

essentially neutral. With respect to the County, while there is a loss of tax

revenue, the County is also relieved of the cost of providing services to the

Expansion Area. The Corvus Report sets out a proposal to provide tax

relief to property owners in the Expansion Area.

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1. D.   ANNEXATION PRINCIPLES

 In MGB 123/06, the Municipal Government Board (“MGB”) set out 15 principles to apply

when considering an annexation application. At the hearing before the MGB, the Town

will present evidence to address the 15 principles, which is summarized below.

 

Principle 1: Intermunicipal Cooperation

 Annexations that provide for intermunicipal cooperation will be given

considerable weight. Cooperative intermunicipal policies in an intermunicipal

development plan will be given careful consideration, weight and support so long

as they do not conflict with Provincial policies or interests.

Although cooperation is preferable, in some cases, an annexation agreement cannot be

reached. In this case, the Town has been willing to pursue discussions throughout.

The County, however, has not been willing to engage in further discussions. As set out

in MGB 034/10 [Volume 1, Tab 6], under the Municipal Government Act (“MGA”), an

annexation agreement is not a requirement in order to proceed with an annexation. The

MGA contemplates that the parties may not always be able to reach agreement

regarding annexation and provides a mechanism for such annexations.

Notwithstanding that the Town and County have been unable to reach agreement

regarding annexation, there is still a degree of cooperation as is evidenced by the

numerous inter-municipal agreements referenced in the Corvus Report. In particular, as

already noted, the Town is already providing or has agreements in place to provide

services to much of the Fringe Area. As well, once a decision is reached regarding this

annexation application, the Town is committed to pursuing further discussions with the

County concerning a new IDP.

 

Principle 2: Rational Growth Directions, Resource Use, Fiscal Accountability and

Municipal Purposes

 Accommodation of growth by all municipalities (urban or rural) must be

accomplished without encumbering the initiating municipality and the responding

municipality’s ability to achieve rational growth directions, cost effective utilization

of resources, fiscal accountability and the attainment of the purposes of a

municipality described in the Act.

The Mackenzie Report demonstrates that the proposed annexation allows for growth to

continue in a rational direction, with proposed lands uses that are consistent with the

IDP that had been agreed to by the Town and the County. With the level of

development in the Fringe Area and the County’s planned future development as set

out in the Proposed ASP’s, it will become increasing more difficult for the Town to

properly plan for its future growth. The proposed annexation will allow the Town to plan

for its future growth on a long term, comprehensive basis.

Of particular note is the lack of large industrial sites in the Town. The industrial land

within the Town is made up of smaller, fragmented parcels. As such, the Town is

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virtually unable to accommodate new industrial growth. The proposed annexation

provides for a logical extension of the industrial areas within the existing Town

boundaries and provides an opportunity for future industrial development.

As set out in the Corvus Report, the Town already provides or has agreements to

provide services to much of the Fringe Area. As the population of the Drayton Valley

urban community grows, the Town will have to provide more services and facilities to

accommodate that growth. To do so efficiently and remain viable, the Town will need to

expand its boundaries.

The Corvus Report further sets out the financial impacts of the proposed annexation.

Tax protection is proposed for landowners in the Expansion Area who could potentially

be negatively impacted by the proposed annexation.

The proposed annexation does not unduly interfere with the County’s ability to grow.

The Expansion Area represents only 1.5% of the area of the County. The County could

easily accommodate growth at the same rate as is projected for the Town (2.5%) and

would still have a surplus of approximately 300,000 hectares of land. The County has a

number of other suitable areas for future growth. For example, the Village of Breton is

located within the County as are a number of hamlets. The primary reason that County

growth is focussed on the Fringe Area is due to the proximity to the Town and the

availability of Town services.

In terms of financial impacts, the cost savinqs of no longer being required to provide

services to the Expansion Area will, to some extent, offset any loss of tax revenue to the

County. In this regard, the Proposed ASP’s contemplate areas in which municipal

infrastructure and services to an urban standard will be provided, which will require

significant expenditures by the County.

 

Principle 3: Autonomy of Municipalities

 An annexation or annexation conditions should not infringe on the local

autonomy given to municipalities in the Act unless provisions of the Act have

been breached or the public interest and individual rights have been

unnecessarily impacted.

The proposed annexation does not infringe on the County’s autonomy as granted under

the MGA. The Town attempted to reach an annexation agreement through numerous

negotiations with the County. When this failed, the Town proceeded with an annexation

application in accordance with the MGA.

 

Principle 4: Supporting Materials Concerning Growth

 An annexation must be supported by growth projections, availability of lands

within current boundaries, consideration of reasonable development densities,

accommodation of a variety of land uses and reasonable growth options within

each municipality (initiating and responding municipality).

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The Mackenzie Report addresses the Town’s projected growth rate and the land that

will be required to accommodate that growth for the next 50 years. The 50 year time

frame is consistent with the trend in Alberta towards longer-term planning and with

recent MGB orders (MGB 148/08, MGB 34/10 [Volume 1, Tab 6]). Given that the

Expansion Area represents a relatively very small area of the County, it should not

restrict the County’s future growth.

The Town has elected to proceed with an annexation application for a 50 year

timeframe in order to allow the Town, the County and affected landowners to put the

issue behind them and move forward. A shorter term agreement, such as the 2001

Annexation Agreement would simply mean that the parties would find themselves

dealing with the same issues within a relatively short time. This does not serve

anyone’s interests.

 

Principle 5: Logical Extension of Growth Patterns and Services

 An annexation must achieve a logical extension of growth patterns,

transportation and infrastructure servicing for the affected municipalities.

 

The Mackenzie Report demonstrates that annexation of the Expansion Area represents

a logical extension of growth patterns. The Corvus Report shows that the proposed

annexation will allow both the existing developments within the existing Town and new

developments in the Expansion Area to be efficiently and effectively serviced.

The Proposed ASP’s seek to increase the density in the Fringe Area. In some areas,

the proposed densities are comparable to urban densities and the expectation is that

these areas will be serviced by the Town. If the Town is not able to expand its

boundaries and the County proceeds with development as set out in the Proposed

ASP’s, then the result will be an “inner Town” comprised of the area within the existing

Town boundaries and an “outer Town” in the Fringe Area, with each area being

administered by a different municipality. This is neither logical nor efficient.

 

Principle 6: Administration of Services

 Each annexation must illustrate a cost effective, efficient and coordinated

approach to the administration of services.

Currently, the Town is either providing services or has an agreement to provide services

to much of the Fringe Area. Much of the existing development in the Fringe Area is fragmented and at low densities. Servicing this type of development is not efficient. As

set out in the Proposed ASP’s, the County is planning for significant development in the

Fringe Area, which is designed to take advantage of services provided by the Town. In

light of this, it is far would be far more cost effective and efficient for the Town to carry

out servicing of the Fringe Area if this area was part of the Town as is set out in the

Corvus Report.

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Principle 7: Key Environmental and Natural Features

 Annexations that demonstrate sensitivity and respect for key environmental and

natural features will be regarded as meeting provincial land use policies.

The most significant environmental feature within the Expansion Area is the North

Saskatchewan River. The proposed land use plan as set out in the Mackenzie Report

recognizes the environmental sensitivity of the North Saskatchewan River Valley and

ravines and takes into consideration the establishment of the Eagle Point Provincial

Park and Blue Rapids Provincial Recreation Area. The Mackenzie Report also gives

consideration to an organic soil deposit located in the northwest portion of the

Expansion Area. Overall, the Town is committed to conservation of the environment

and will take the necessary measures to ensure that environmentally sensitive areas

are protected.

 

Principle 8: Use of Resources

 Coordination and cost effective use of resources will be demonstrated when

annexations are aligned with and supported by intermunicipal development

plans, municipal development plans, economic development plans,

transportation and utility servicing plans and other related infrastructure plans.

As the County elected to withdraw from the lDP, there is currently no joint plan in place

between the Town and County. Notwithstanding this, in developing a land use plan for

the Expansion Area, the Town essentially adopted the land uses that had been set out

in the lDP. The Town and County have conducted further discussions regarding

preparation of a new lDP but have not been able to reach an agreement. One reason

for this failure is that the parties could not agree on where the Town’s boundary should

be located. The MGA does not provide a mechanism to resolve disputes concerning

creation of an lDP; however, it does provide a mechanism to determine municipal

boundaries. Once the Town’s boundaries are determined, it is committed to working

with the County to prepare and implement a new lDP.

 

Principle 9: Financial Impact

 Annexation proposals must fully consider the financial impact on the initiating and

responding municipality.

The Corvus Report considers the financial impact of the proposed annexation. Some

landowners in the Expansion Area could face higher taxes as a result of the annexation.

As such, the Town has proposed tax relief in order to assist those landowners.

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Principle 10: Impacts on Other Institutions

 Inter-agency consultation, coordination and cooperation is demonstrated when

annexations proposals fully consider the impacts on other institutions providing

services to the area.

The Town notified a number of other agencies and institutions regarding the proposed

Annexation as set out in the Annexation Application. The Town also held open houses

to obtain feedback regarding the proposed annexation. No responses were received

from other agencies and institutions other than comments from Evergreen Gas Co-op,

which are included in the Annexation Application. The Town is prepared to work with

Evergreen Gas Co-op to allow it to continue to operate within its existing service area

[Vol. 1, Tab 5].

 

Principle 11: Impacts on Property Owners

 Annexation proposals that develop reasonable solutions to impacts on property

owners and citizens with certainty and specific time horizons will be given careful

consideration and weight.

As set out in the Corvus Report, the Town proposes to implement measures to provide

tax relief to landowners within the Expansion Area. Specifically, the Town proposes that

they will be taxed using the County mill rate until the earlier of ten years or development

of the site (being defined as an application for land use redesignation or subdivision).

 

Principle 12: Public Consultation

 Annexation proposals must be based on effective public consultation both prior to and

during any annexation hearings or proceedings.

Included in the Annexation Application is a report from Calder Bateman that sets out the

details regarding the Town’s public consultation process. The Corvus Report also

summarizes the public consultation process as well as the Town’s response to concerns

raised during that process. The Town’s website has a section devoted to dealing with

annexation, which is periodically updated. Most recently, the Town has posted relevant

information from the Annexation Application on its website. The Town also conducted a

further open house on November 29, 2009.

 

Principle 13: Special Properties

 Revenue sharing may be warranted when the annexation proposal involves

existing or future special properties that generate substantive and unique costs to

the impacted municipality(s) as part of the annexation or as an alternative to

annexation.

There are no special properties within the proposed annexation area.

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Principle 14: Financial Impacts on Municipalities

 Annexation proposals must not simply be a tax initiative. Each annexation

proposal must have consideration of the full scope of costs and revenues related

to the affected municipalities. The financial status of the initiating or the

responding municipality(s) cannot be affected to such an extent that one or the

other is unable to reasonably achieve the purposes of a municipality as outlined

in section 3 of the Act. The financial impact should be reasonable and be able to

be mitigated through reasonable conditions of the annexation. ..”

The Corvus Report addresses the financial impacts of the proposed annexation.

 

Principle 15: Conditions of Annexation

 Conditions of annexation must be certain, unambiguous, enforceable and be time

specific.

The Town has proposed certain conditions relating to providing tax relief for landowners

within the Expansion Area.

 

1. E.   CONCLUSION

 In recent years, as is acknowledged in the County’s Proposed MDP, the majority of the

new growth and development in the County has been concentrated in the Fringe Area.

The County is now engaged in the planning of new development in the Fringe Area as

set out in the proposed ASP’s. While this growth is within the County, it is occurring in

the Fringe Area due to the proximity to the Town and the availability of Town services.

As set out above, the Town boundary is artificial as the existing Town and the Fringe

Area essentially function as one community – the Drayton Valley urban community.

The proposed annexation is directed at bringing the Drayton Valley urban community

under the jurisdiction of one municipal government, which will provide the Town with an

adequate supply of land for future residential and business growth and will give the

Town the opportunity to properly plan for its future growth. Without the proposed

annexation, the County will continue to develop the Fringe Area, which will ultimately

encircle the Town, leaving it with nowhere to grow. The proposed annexation is

therefore essential to the Town’s future growth.

Annexation is a difficult and divisive process. The Town has determined that it is in the best interests of all parties to deal with the Town’s growth needs on a long term basis.

Accordingly, the Town is seeking to annex sufficient land to accommodate its growth for

the next 50 years so that all affected parties can move forward and properly plan for the

future.

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