NewsMetro Van Report on Residential Infrastructure Cost
Note: the image above is AI generated and there probably aren’t that many people walking underground.
In our ongoing discussion about the provincial government’s initiatives to boost housing supply, an important consideration arises: the impact of these changes on our infrastructure needs. With an expected increase in population, there’s a natural surge in demand for essential services including roads, schools, sewer systems, water supply, and waste management. A pertinent question emerges: How much does infrastructure really cost, and how does this cost vary with different types of development?
A comprehensive report (linked here) published in September 2023 by Metro Vancouver Regional Planning offers some insights on this matter. The report delves into various case studies across cities in Canada, the United States, and Australia, aiming to dissect the intricacies of infrastructure costs associated with diverse forms of urban development.
General Findings
One of the report’s key findings is the significant cost advantage of more compact forms of development. It was observed that denser developments substantially reduce the per capita construction costs for essential infrastructure like roads, sewers, water supply, and waste management systems. This correlation makes intuitive sense when you consider that the amount of road and other infrastructure per housing unit decreases as development density increases.
Mixed housing neighbourhoods based on a grid street pattern, as opposed to curvilinear or cul-de-sac based suburban streets, tend to be the most efficient and cost effective for infrastructure service delivery
Metro van report page 187
Moreover, the report sheds light on the costs associated with various services, including sanitary, water, police, and fire departments. It was found that these costs, especially on the capital investment side, tend to decrease on a per capita basis as the density of development increases. This finding underscores the efficiency gains that can be achieved through thoughtful urban planning that emphasizes compact development.
However, in the report’s literature review, there were studies that found increasing per capita policing operational and community housing costs with Smart Growth development patterns – a school of thought emphasizing mixed use, denser development as opposed to urban sprawl.
Cost Estimates
Perhaps one of the most striking revelations from the report is the disparity in costs between different housing types. Specifically, the cost for onsite services per capita for individual houses was estimated to be between 5 to 9 times higher ($13,000) compared to apartments ($2,000). This stark difference highlights the economic efficiencies that can be leveraged through higher-density housing options.
A summary of development cost charges (DCCs) somewhat reflect this dynamic – $40-60k for SFH and around $10-20K for apartment units.
However, on a per capita basis, it appears that the spread between lower density and higher density DCCs, between $9,000 to $12,000 around a 30% increase, may not be reflective of underlying infrastructure cost dynamics noted above which can vary far more per capita.
Key Takeaways
In summary the report highlights the importance of carefully considering the infrastructure costs of new development when setting DCCs so as to not inadvertently encourage less efficient growth patterns through essentially subsidization. Where possible, the report recommends permitting cost-effective forms of development such as infill in well-serviced and developed areas to make the most of public infrastructure investment.