Red Deer plans for a population of 300,000

By Jim Bentein

During one of the worst global economic downturns in 70 years, the city of Red Deer, Alta., did something remarkable this past year.

It grew.

The latest census, completed this summer, shows central Alberta's largest city grew by 2.4 per cent from 2008, with 2,075 new residents, to reach a population of 89,891.

The community, originally a farm centre, had 125 residents in 1898. Its population more than tripled over the last forty years, with annual growth as high as 9.8 per cent some years. In 2006, the city and Red Deer County launched a planning initiative called Future Directions: Red Deer at 300,000. "When city council chose the 300,000 population number, it was fairly arbitrary," says project leader Paul Meyette. "They wanted to pick something far enough in the future, not just 10 years from now, but perhaps 75 years down the road."

Population projections prepared for the city in 2007 by Schollie Research & Consulting looked at three different growth scenarios, from annual low growth of 2.02 per cent to 3.26 per cent. The Red Deer-based firm predicted the urban population could reach between 136,502 and 184,945 by 2031, just 22 years from now.

Red Deer's trading area, which stretches north as far as Ponoka and south to Olds, has a population of almost 240,000. Meyette says planners assume that "the growth will come, whether we like it or not." The Red Deer at 300,000 project aims at avoiding the haphazard expansion experienced during previous boom periods. A persistent problem has been friction between the city and its surrounding county.

The county of Red Deer totals 20,000 people and 4,000 square kilometres, embracing seven hamlets, several rural subdivisions, four villages, and four towns, including Sylvan Lake and Innisfail. It includes "Gasoline Alley," a commercial strip stretching along Highway 2 beside the city. "We were both looking at growing in the same area," says Meyette. The two municipalities are now working on an area structure plan, to be released next year. That plan will establish where growth can occur and how the city will compensate the county for annexed land.

Parkland Community Planning Services oversees municipal planning for virtually all of central Alberta. Orlando Toews, a planner with the Red Deer-based agency, says Alberta Municipal Affairs (which approves land annexations) normally wants "municipalities to have enough land for the next 20 or 30 years of growth. But we're taking a more forward-looking approach and saying we need this much land for the next 100 years."

In the light of the economic weakness now plaguing North America, the province has capped borrowing limits by the city, which is delaying infrastructure projects. Nevertheless, Meyette and Toews say the visionary planning exercise will go ahead and eventually the dollars will be available to develop the roads, sewers, and other infrastructure needed to make it a reality.

"There will be several mixed-use town centres," says Toews. "Historically, people have lived on the south side of the city and they've driven to work on the north side. We're looking at planning for a more sustainable community, where people will live and work in the same area." These multi-use centres would be linked by a bus system to a proposed high-speed rail link between Calgary and Edmonton.

Debbie Bonnett, the county's manager of economic development, says Red Deer RED (Regional Economic Development) is a collaborative initiative between the county, the city, the Red Deer and District Chamber of Commerce, and Red Deer College. The partnership, which has one full-time employee, identifies opportunities to build on the region's traditional strengths-oilfield and agricultural services, education, health, and public administration.

Central Alberta strikingly lacks foreign investment, according to a report completed for Red Deer RED by Montreal-based consultants E&B Data. "Now that the Red Deer 300,000 plan is done, both the city and the county have serviced land to grow on," says Bonnett. "E&B will generate leads for us and we'll try to attract companies to the area."

Red Deer RED and the federal government's Western Economic Diversification Canada are equally funding a three-year, $360,000 program aimed at attracting firms involved in manufacturing, agrifoods, transportation, and logistics. Although growth has slowed over the past year, Bonnett says it has hardly ground to a halt. Two new hotels are being built, one on the east side of the highway and another one on the west side.

In the industrial sector, Ottawa-based Plasco Energy Group is planning but not proceeding with a $90-million waste-to-energy facility. The three-phase project would eventually transform 300 tonnes of regional garbage per day into 15 megawatts of electricity. Also on hold is a $400-million biodiesel and ethanol refinery planned for the Innisfail area. That project, proposed by Florida-based Dominion Energy Services LLC and New York City-based Riverstone Holdings, would include a canola crushing plant and a biodiesel refinery. Bonnett says both projects will likely go ahead when the national economy recovers.

The city and county boast one of western Canada's largest oilfield service sectors, now being hammered by layoffs and delayed capital projects. For example, Finning (Canada), a division of the world's largest Caterpillar dealer, had planned to develop a 200,000 square foot Centre of Excellence, which would eventually train 400 people to maintain Caterpillar equipment. That project has been sidelined for now. However, Bonnett says oilfield services continue to be a key player in the area's economy.

A large employer in the district is the petrochemical industry. In the Joffre-Prentiss area, about 20 kilometres from Red Deer, are plants owned by Nova Chemicals Corp., Dow Chemical, and Praxair Canada Inc. The industry employs 1,600 workers full-time and is responsible for another 5,000 indirect jobs. Cyril Cooper, land and economic development officer for the City of Red Deer, says lower prices for natural gas feedstock have actually helped the petrochemical sector.

The region has dozens of other manufacturers, ranging from a company that makes trusses and to metal fabricators to a hog slaughtering plant. That operation, owned by Quebec-based Olymel L.P., is by far the region's largest employer, with more than 1,200 employees. It has announced plans to expand current processing of about 9,700 hogs a day and to hire as many as 1,000 more workers. That project, too, is now on hold due to the weak economy.

Cooper isn't altogether disappointed over the development downturn. "We were bursting at the seams in 2006 and 2007," he says. "Local employers struggled just to find enough workers. We were growing by 7 to 8 per cent a year, which meant we couldn't keep up." The municipal officer estimates local economic expansion at 2 per cent a year now, about the same as the population increase. "That's healthy growth," he comments.

The city has ample serviced industrial and residential land while interest rates are low, Cooper says. Housing is also more affordable. The median price of a home fell from $292,163 last August to September to $272,725 this summer, the first decline in many years. Median family income is about $90,000 a year, making Red Deer an affluent community by western Canadian standards.

Cooper says the pause in the city's growth has caused some local residents to upgrade their training at Red Deer College. "In Calgary, about 32 per cent of the population has a post-secondary education, while only 9 per cent of the people in Red Deer have a post-secondary education," he says.

Red Deer College has 7,800 full- and part-time students and 1,200 full- and part-time employees. Jim Madder, its academic VP, says, "People think of us as an oilfield service area, but the range of manufacturers here is broad, from chemical manufacturing to furniture manufacturing, dental supplies, and electronics. One of the college's priorities is to work with those industries to help solve manufacturing problems."

The annual 2007 manufacturing survey, conducted by Red Deer RED, identified 219 manufacturers in the central Alberta region. Despite the slowdown in the natural gas sector, overall sales by manufacturers in the region remained steady in 2007 from 2006. Overall sales by manufacturers hit $6.2 billion. Better yet, the value of manufacturing exports rose from $950 million in 2006 to $1.3 billion in 2007. Madder says 68 of local companies are major exporters internationally.

Red Deer College provides trade-related instruction to about 1,000 apprentices a year, along with university degrees through partnerships with the University of Alberta and the University of Calgary. "We offer everything from courses in office administration to licensed practical nursing to early learning and child-care diplomas," Madder says. Nursing and education degrees can be completed while living in Red Deer, and more degree are in the works.

The college focuses heavily on training caregivers for the elderly, including preventative health programming that enables small-town residents to continue living in their homes. "Depopulation of rural communities is a serious issue, and our initiative is aimed at helping people age well in their own communities," Madder says. "We respond to community needs, whatever they are."

In June, four new training centres officially opened at Red Deer College, financed with a $59-million provincial grant and $15 million in local funds. A new 200,000 square foot facility houses these centres: Trade and Technology; Innovation and Manufacturing; Corporate Training; and Visual Arts.

Derek Gratz, Red Deer College's director of applied research and innovation, sees his role as ensuring that the four centres remain attuned to the needs of business. "The college is saying we can provide more industry-relevant applied research," he says. For example, a business could develop a new product in cooperation with the academic institution, using its sophisticated computer modelling facilities and machines that make plastic prototypes.

Oilfield workers are contributing to Red Deer's economic buoyancy by travelling to work at distant sites. Northwestern Air, based in the Northwest Territories, already flies from Red Deer to Fort McMurray. Swanberg Air Inc. has announced that it will be starting passenger service from Red Deer to Calgary, Edmonton, and Grande Prairie. In November, Swanberg is scheduled to start flying to Swift Current, Regina; and Estevan, Sask.

In part due to that travel, the unemployment rate in Red Deer and central Alberta remains tolerable. "It's now at about 7.5 per cent," Cooper reports. "In 2007 it was 3.2 per cent, which meant there was effectively no unemployment. I doubt we'll ever see 10 per cent here."