REQUEST FOR DECISION
DATE: May 29, 2019 Report No. DEV-19-050
TO: Laurie Hurst, Chief Administrative Officer
FROM: Bill Brown, Director of Development Services
SUBJECT:
Title
Review of Capital Regional District’s Population, Dwelling Unit, and Employment Projections Update for Township of Esquimalt
End
RECOMMENDATION:
Recommendation
That Council request the Capital Regional District to obtain a third party review of the methodology used to calculate the population, dwelling unit, and employment projections prior to commencing the amending process for the Regional Growth Strategy.
Body
RELEVANT POLICY:
Regional Growth Strategy - Capital Regional District Bylaw No. 4017
Official Community Plan Bylaw, 2018, No., 2922
Township of Esquimalt Strategic Priorities 2019-2023
STRATEGIC RELEVANCE:
Although the population, dwelling unit, and employment projections are not related to any specific strategic priority, goal, or operational strategy, an accurate understanding of demographic trends in Esquimalt informs the Township’s response to many of the items in the Strategic Plan.
BACKGROUND:
Section 429 (2) (b) of the Local Government Act states that, “A regional growth strategy must cover a period of at least 20 years from the time of its initiation and must include population and employment projections for the period covered by the regional growth strategy”. The current regional growth strategy contains population projections based on data from the 2011 Census. Implementation measure I-6 of the regional growth strategy requires that the population projections be updated using the most recent census data, namely data from the 2016 Census. The necessary data was released by Statistics Canada in early 2019 and the Capital Regional District (CRD) subsequently engaged BC Statistics to prepare the new population projections. These projections, along with projections for dwelling units and employment, were presented to the CRD’s Planning and Protective Services Committee on May 15, 2019 (Appendix A). Staff have reviewed the projections and wish to bring Council’s attention to a number of issues.
First, it is noted that in the Table showing the population projections for each municipality (Appendix B), Esquimalt’s population is expected to grow from 19,100 in 2018 to 21,100 in 2038, an exponential annual growth rate of approximately 0.5 percent. This is a fairly low annual rate of growth. Interestingly, Esquimalt’s 2016 Census population was 17,655 and BC Statistic’s estimated 2018 population was 19,100; an exponential annual growth rate of approximately 4.0 percent. This is a very high rate of growth. No clear explanation of the discrepancy between the two rates of growth is provided in the documentation from the CRD.
Second, the Table shows 8,100 dwelling units in 2018 and 10,000 in 2038, an increase of 1,900 dwelling units over the 20 year period. This does not seem to reflect the current reality in Esquimalt. For example, since January 1, 2019 building permits, including occupancy permits, have been or are about to be issued for approximately 475 dwelling units. That is, building permits have been issued or are about to be issued in 2019 for 25 percent of the dwelling units projected in the next 20 years. While this trend is not expected to continue at this rate for the next 20 years, it calls into question the accuracy of the CRD’s projection. In addition to the dwelling units where a building permit has been issued or is about to be issued, there are an additional 878 dwelling units in various stages of the planning approval processes for a total of 1,353 dwelling units. This means that, given the CRD’s projections, we can only expect to receive development proposals for an additional 547 dwelling units in the next 19 years. While the future cannot be predicted with any certainty, this does not seem very realistic given Esquimalt’s current development environment.
Third, in addition to questions about the accuracy of the population and dwelling unit projections, the employment projections are also somewhat suspect. The Table shows employment in Esquimalt dropping from 13,100 in 2018 to 11,000 in 2038 - a decrease of 2,100. The analysis does not seem to have given much weight to the fact that Esquimalt is home to two of the region’s largest employers, namely CFB Esquimalt and the Federal Graving Dock. There are a myriad of factors that may affect these two employers in the future including the increased use of autonomous warfare, the rise of China as a global power, and the speed with which the National Shipbuilding Program moves forward. None of these factors seem to have been accounted for in the employment projections but probably should be.
The potential issues with the projections are largely related to whether the appropriate model was used. With regard to population projections, there are many models that can be used. Demographers have identified the following typology of population projection models (see S. K. Smith et al. A Practitioner’s Guide to State and Local Population Projections, The Springer Series on Demographic Methods and Population Analysis 37, 2013 pg. 5:
1. Micro-simulation
2. Structural Models
a. Urban Systems (used by the City of Colwood for their Demographic Study and Land Yield Analysis)
b. Economic-Demographic
3. Cohort-Component (this is the model used by BC Statistics for the CRD’s population projections (Appendix B)
4. Trend Extrapolation
a. Ratio
b. Complex
c. Simple
Each model has advantages and disadvantages, some of which are identified in the Population, Dwelling Units and Employment Projection Report prepared by BC Statistics (Appendix C). Given the dynamics of Esquimalt’s growth which appears to be driven more by variables related to housing supply, environmental amenities, access and provision of services, and proximity to the City of Victoria than the variables used in the cohort model (some of which are not available for the Township (e.g. fertility rate)), it is possible that a more accurate population projection for the Township of Esquimalt and perhaps other growing municipalities in the CRD could be derived from using a more appropriate model. It is certainly possible that the Cohort-Component model is the most appropriate model; however, the data seems to indicate that it would be worthwhile to engage a third party with expertise in the use of various population projection models to provide the CRD Board with an opinion about whether or not more accurate population projections could be achieved by using a different model. It should be noted that the City of Colwood recently had a “Demographic and Land Yield Analysis” completed using an urban systems model. The results of that analysis were different than the projections done by the CRD. The differences were due to the types of models used. In addition to examining whether or not the most appropriate population model was used, a similar analysis should be done for the models/methodologies used to project dwelling units and employment. It should be noted that the dwelling unit projections for Esquimalt were derived by applying the ratio of the number of people per dwelling unit to the derived population projection (i.e. the models/methodologies are interrelated).
Finally, it should be noted that in response to the potential inaccuracies of the various projections at the municipal level, the CRD is proposing to only incorporate sub-regional projections in the amendment to the Regional Growth Strategy (Appendix D).
ISSUES:
1. Rationale for Selected Option
The CRD’s population, dwelling unit, and employment projections do not seem to reflect the reality of Esquimalt’s development. It may be possible that the use of a different model may provide more realistic results.
2. Organizational Implications
There are no significant organizational implications at this time.
3. Financial Implications
There are no significant financial implications at this time.
4. Sustainability & Environmental Implications
There are no significant sustainability and environmental implications at this time.
5. Communication & Engagement
There are no statutory communication or engagement requirements.
ALTERNATIVES:
1. That Council request the Capital Regional District to obtain a third party review of the methodology used to calculate the population, dwelling unit, and employment projections prior to commencing the amending process for the Regional Growth Strategy.
2. That Council accept the population, dwelling unit, and employment projections provided by the Capital Regional District.