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Developing Master Plans for Resilient Infrastructure within Existing Urban Centres

The challenge

To introduce robust disaster resilient infrastructure and support systems in existing urban centres in a manner that is cost effective manner for local governments

After sustaining millions of dollars in damage from the aftermath of extreme weather events across North America, several governments have sought to introduce infrastructure systems that protect existing urban centres against future flooding, excessive ice and snow storms, and wind systems. However, the introduction of resilient infrastructure systems has been slow and problematic within several North American urban centres. This is due to the complexity of retrofitting existing centres, which largely exists when public authorities do not own land parcels necessary to introduce resilient infrastructure systems, those land parcels are subject to numerous and sometimes contradictory existing uses, and the cost of retrofitting urban centres exceeds the budgetary thresholds for responsible governments or are not recoverable from traditional funding sources.

As the pace of urbanization continues to catalyse the expansion of existing North American urban centres, so too does the risk of damage and loss of life when extreme weather events occur. The cost to relocate populations as a remedial measure can be significant. The infrastructure planning processes within several large urban centres often occurs in parallel to regimes controlling government expenditures and land use planning. As such, gaps between government-led resilient infrastructure and land development activities within existing urban centres often emerge. This gap is expected to widen in the absence of clear leadership and a fiscal plan to facilitate the development of resilient infrastructure within existing urban centres.

The idea

To develop master plans for underdeveloped neighbourhoods within existing urban spaces which introduce resilient infrastructure systems as well as incentives for private developers to supply and/or subsidize infrastructure using public-private partnerships.

This solution is comprised of the following elements:

– Create a comprehensive master plan for neighbourhoods within existing urban spaces. The master plan should incorporate resilient infrastructure systems for the neighbourhood. Amend the land use planning regime supporting the master plan in order to permit the development or redevelopment of different land uses that complement the resilient infrastructure systems as well as attract market-based developers.

– Craft a land value based tax system to generate revenue for government-owned development corporations from market-based developers and/or tenants of the resulting real estate development. If a market does not exist, consider phasing in the tax system and/or offering property based tax incentives to cultivate the marketability of the site.

– Establish a government-owned infrastructure corporation in order to obtain financing for the construction of the new infrastructure systems. The property-value based tax stream can be assigned from the government-owned development corporation and/or the government’s general revenue account to the infrastructure corporation in order to repay this financing. The suitability of this financing (known as project financing) depends upon the market attractiveness of the master plan and the government’s fiscal status.

– Select market-based developers based upon identified priorities for the neighbourhood, such as sustainable building infrastructure and innovation, transit-oriented development, and disaster resiliency. Amendments to building codes and practices can be introduced to incentivize the construction of buildings that are more resilient, particularly to floods.

This solution is foreseen as closing the gap between government-led resilient infrastructure and support system planning and land development activities within existing urban centres in a manner that is cost-effective. It can also facilitate the development or redevelopment of new neighbourhoods that promote sustainable objectives and disaster resiliency.

This solution was adopted in New York, USA through the redevelopment of the area adjacent to the Hudson River in Manhattan. This area surrounded an interregional rail line system and was largely underdeveloped until a series of master planning exercises were initiated in the early 2000s. These exercises sought to enhance the transit, park and connectivity infrastructure for the area while also encouraging high-rise mixed use real estate developments to establish a new neighbourhood within Manhattan. Intersecting the master planning process were changes within the land use-planning regime to permit private developers to enhance building density in exchange a series of payments to subsidize new infrastructure. Following the property damage and loss of power induced by Hurricane Sandy in 2012, several private developers introduced resilient infrastructure systems within real estate developments, including those built atop of fully functioning inter-regional rail lines following the private acquisition of air rights. The features in one development, known as Hudson Yards by The Related Companies, involve:

– Telecommunication systems to exclusively service the network of new buildings

– High efficiency co-generation plants to service a grid of buildings and automatically disconnect from the New York City power grid in the event of a power outage

– Extensive recycling and garbage systems within buildings to extract water and accommodate future compost systems

– Use of thousands of data sensors to track the health of buildings and new infrastructure

– Placing building support/mechanical equipment above grade to circumvent flood damage

The incorporation of resilient infrastructure within private developments can be attributable to a) the market potential of the real estate site, b) the scale of the master plan for private development, c) the reputation impact of creating a new neighbourhood within Manhattan, and d) the long-term development horizon of the private developers and their institutional investors.

Variations of this solution have been introduced to develop flood protection infrastructure for other existing urban areas. For example, the Canadian province of Ontario utilized public private partnerships to protect its most populous city, Toronto, from 100-year floods through the use of master planning. One master plan involved the development of flood protection infrastructure in the form of an urban park system while also changing the land-use planning regime to promote mixed-use private real estate development in the surrounding area. This area is now known as the Canary District and has reclaimed once environmentally contaminated land for public use and the creation of a new sustainability-oriented neighbourhood within Toronto.

This solution has facilitated the introduction of infrastructure in a way that enhances disaster resiliency for existing urban areas while using private-sector involvement. This involvement is led by the urban planning process and has the potential to subsidize the cost of introducing resilient infrastructure.

Sources: Hudson Yards Development Corporation, Hudson Yards -The Related Companies, Waterfront Toronto West Don Lands Master Plan

The barriers to innovation – and the solutions

This solution relies upon the cooperation of several stakeholders within the urban planning process as well as favourable real-estate market fundamentals

Internal Barriers

– Cooperation among different government actors, including those involved with land use control, infrastructure planning, budgetary sources, and economic development, across a variety of jurisdictions (federal, provincial/state, and local governments)

– Cooperation among local community stakeholders

– Lack of unified priorities and method for evaluating alternative master plans, financing packages, and revenue streams

– Financial health of overseeing government(s) should there be a need to borrow to finance the construction of resilient infrastructure

External Barriers

– Global and local economic forces affecting the demand and supply for development in particular area

– Access to, and volatility, of credit markets if a government-led investment corporation will need to borrow to finance the construction of resilient infrastructure

– Attracting global talent to develop and implement master plans

These barriers can be addressed by:

– Implementing master plans in phases; phases with the greatest activity will occur when real estate and capital markets are most favourable to development

– Involving an life cycle involved in developing resilient infrastructure across jurisdictions in order to align priorities across different stakeholders

– Hosting international planning competitions to foster innovation and engaged talent

The way forward

The way forward involves viewing the introduction of resilient infrastructure as an urban planning decision as well as an opportunity for public-private partnerships.

Next steps involve the creation of best practices to evaluate how stages of the master planning process can be complemented with the technical evaluation of resilient infrastructure and the market potential for public-private involvement. The financial sustainability of the related real estate development will need to be constantly evaluated by third-party experts to ensure that the financing costs associated with new infrastructure can be repaid. Additional steps involve the creation of measurement systems to evaluate the successful integration of resilient infrastructure with other infrastructure systems within urban spaces. Data management strategies, particularly for data collected by private actors, will need to be considered.

New ways of approaching the introduction of resilient infrastructure as a component to the urban planning process involve discussions related to public management, transparency, and accountability, as well as public consultation and engagement. It will also involve the development of collaborative communication and information sharing approaches across a variety of stakeholders. This will involve systemic changes about the role of infrastructure and real estate, who should be involved in delivering infrastructure, and how resiliency can be approached from technical, consultative and market-based perspectives.