Calgary no longer able to afford Green Line project following provincial scope change: mayor

Calgary's Green Line project dealt killing blow The City of Calgary says it won't be able to proceed with the Green Line after the province pulled out of the deal. Mason DePatie reports.

The City of Calgary is no longer able to afford the cost of the CTrain Green Line project, following a “significant scope change” by the provincial government.

Speaking Wednesday, Mayor Jyoti Gondek said the city received a letter from the province outlining the change in scope.

“We have been fiscally responsible with this project, we have tried to deliver it within the budget that we had before us with our other two funding partners,” Gondek said.

“Unfortunately, the delay that will come from this review that’s been requested, and the uncertainty in the market will elevate costs on this project.”

In a post on X, Devin Dreeshen, minister of transportation and economic corridors, said the current iteration of the Green Line project, now billions over budget, serves too few Calgarians.

“There has to be a better way to invest $6.2 billion of taxpayers’ money to improve Calgary’s transit system for the needs of many more commuters,” Dreeshen said in the post.

“We look forward to seeing a new alignment from an independent third party, separate from the City of Calgary, before determining the next steps for the Green Line.”

Dreeshen issued a statement on Wednesday:

"There are serious concerns with the City of Calgary’s new business case for the Green Line LRT project that was submitted to the province on August 15th. The new alignment serves too few Calgarians, reducing ridership by 40 percent while the total project cost has risen by about 14 per cent," he said.

"The Green Line was initially supposed to be 46 kilometres and include 29 stations at a cost of $4.6 billion. It has now been reduced to 10 kilometres with 7 stations at a cost of $6.2 billion. In short, with this plan Calgarians are getting less for much more.

"As the provincial government, we have an obligation to ensure taxpayer dollars for infrastructure are allocated efficiently and in a manner that will benefit the largest number of Albertans possible.

"That’s why, we are taking a more active role in aligning the Green Line and will contract a qualified and independent third party to provide alternate above ground solutions for the Green Line that integrate the Red and Blue lines along 7th Ave, and run to the future Grand Central Station at Calgary’s new Arena Entertainment District, and then continue above ground to the community of Shepard and beyond.

"We look forward to seeing a new alignment from the independent third party, separate from the City of Calgary, before determining the next steps.

"Throwing good money after bad is simply not an option for our Government."

Gondek said city council members will be meeting on Wednesday to discuss how to transfer the financial risk of the project from Calgarians to the provincial government.

“We can no longer be the order of government that is holding the debt financing and all of the financial risk on this project,” Gondek said.

Cost concerns

Rising costs forced the city to adapt their plans for Phase 1 of the Green Line project over the summer, announcing that the line would be multiple stations shorter than planned.

The new cost for the shorter Phase 1 was $6.248 billion.

Phase 1 of the project was supposed to cost $5.5 billion for an 18-kilometre stretch from Eau Claire to Shepard in the Southeast.

But due to escalating costs, the project will run from Eau Claire to Lynnwood/Millican.

The updated scope for Phase 1 means there would be five fewer stations in the southeast and the Centre Street station will be deferred.

The train will not run to Ogden, South Hill, Quarry Park, Douglas Glen and Shepard in its first phase.

In a letter in July, Alberta's transportation minister confirmed its $1.5 billion for the project, subject to conditions.

Money will not be reduced or pro-rated, as long as the first phase of the Green Line "connects to the existing Red and Blue lines in downtown Calgary" and it meshes with the province's master rail plan for a "Grand Central Station" next to the new arena.

"A change in the delivery model employed by the city will not, in and of itself, impact the grant funding, subject to the receipt of further details on the proposed delivery model," Devin Dreeshen wrote on July 29.

A copy of the letter to the city, provided by the province, is included below.

With files from CTV News Calgary’s Jordan Kanygin and Damien Wood