Mayor Naheed Nenshi spoke with Richard Florida in October at the "Big City, Big Ideas" lecture series at the University of Toronto's Rotman School of Management.

Naheed Nenshi talks urban development, affordable housing, and how national governments fail cities.

Calgary Mayor Naheed Nenshi’s 2010 rookie foray into politics branded him as a unique non-partisan voice in Canada. His so-called “Purple Revolution”—a campaign strategy named for its official color but also the broad demographic to which he hoped to appeal—caught the attention of not only Calgary but all of Canada. Once elected, Nenshi became what, in the words of The Globe and Mail, “many observers thought impossible—a wonkish, even dorky, academic and visible minority elected to the helm of what is often called Canada's most conservative city."

In 2013, Maclean’s ranked Nenshi, the first Muslim mayor of a major North American city, as the second-most important person in Canada (Prime Minister Stephen Harper was number one). He’s also among 26 global mayors shortlisted for the 2014 World Mayor Prize. (The winner will be announced in January.)

I first met Nenshi more than a decade ago, when he participated in the Memphis Manifesto Summit [PDF] organized by Carol Coletta. In October, I had a chance to sit down with him again as part of the “Big City, Big Ideas” lecture series at the University of Toronto’s Rotman School of Management, co-hosted by the School of Public Policy and Governance. We talked about his approach to urban policy, the opportunities and divides his city faces, the innovative approach he’s used to rein in Calgary’s notorious suburban sprawl, and the necessity of giving more power to mayors and cities.

Richard Florida: People think of Calgary as a boomtown, as an energy town. But you see it as a haven for innovative people. How do you define the difference?

Mayor Nenshi: We're very young as a city, so there's no old money in Calgary. What people care about is, do you have good ideas? Are you willing to work hard to make those ideas happen? If so, the community will support you, which sounds trite, but it actually is incredibly important. There is remarkable porousness in the social networks. It's easy to go through and around the social networks where a working class kid from northeast Calgary like me could become the mayor and no one would bat an eye. I think that a really important part of what we do has to do with that sense of opportunity for everyone.

Canada is a new kind of economy, which I call a knowledge-energy economy—it takes resources in energy and uses them to undergird investments in higher education and innovation institutions. What do you think about this kind of growth model?

It is very easy for energy-rich economies to get fat and happy, and just live off of that and not be innovative. There is an irresistible public policy imperative to make sure that if you have resources, you use them and monetize them. Everybody knows that someday there will be a low-carbon future. We are sitting on a resource that is unbelievably valuable today, but someday will not be valuable. Monetize it, invest it, and ensure that while it has value, you're using it to sustain a legacy for future generations. We're good at monetizing the resource and we're really lousy at using the proceeds to actually invest in infrastructure, in education, in the knowledge economy—in all those things that make cities work regardless of what the core business in those cities is.

When we make investments in arts and culture and sports and recreation, in vibrant public spaces, and even great public transit, those are hard-nosed economic development decisions. We have got to figure out a way that we make sure we're investing so that when the resource isn't there anymore we actually continue to have a system and an economy that is humming and turning.

We've come to realize that we need investments in transit, we need greater density, we need better public spaces. But there are still a lot of people who come to Canada for opportunity. They want that suburban home. They want their own car. Have you been able to bridge this gap, to make people see the need for a denser, transit-oriented, vibrant community?

Up until about seven or eight years ago, Calgary was growing so that 100 percent of our growth was in brand new neighborhoods at the edges of the city. So what we were doing is we were very slowly hollowing out the city from the middle. We realized that with the combination of more thoughtful policy that was really built around sustainability in all its forms—environmental sustainability, financial sustainability, social sustainability—and straight-up market forces, we could really start to shift. And the shift has happened much more quickly than anyone had anticipated. Our 60-year plan was to reach a 50/50 mix of new suburbs and existing neighborhoods. Last year we were almost at a 50/50 split already. So there's absolutely a need for suburbs, absolutely.

You have to think about the city in three discrete areas. The first is the center city, the downtown, the transit spines and so on. That's where you're really looking at high rise living. That doesn't work everywhere, but it does work for a segment of the population. So that's number one. Number two is you still need new suburbs. But you can build the new suburbs in much more thoughtful ways. They can be significantly denser, but still have lots of single-family homes and garages and backyards. You just have to be a little more thoughtful about it.

It sounds like a lot of what you're doing in Calgary is re-imagining the suburb. We urbanists tend to think in terms of the urban core. But as you indicated, often the places where people want to live most are denser, transit-oriented, walkable, mixed-use suburbs. 

Urbanization of a core in terms of high rise living—the market will build that. With a little bit of regulation, the suburban builders will build those better suburbs. Here's the hard part. What do you do with the neighborhoods in between that are slowly losing population as the kids leave home, and yet you have people who live there who love their neighborhoods?

We need folks to reimagine the neighborhoods they love in a different way. That derelict strip mall at the end of your street that has the 7-Eleven and the pizza shop in it: Imagine if you could have a building there where people just starting their families could live, or seniors could live, or you could move in when you can't keep up your house anymore, and there's still a 7-Eleven and a pizza shop on the ground floor. Wouldn't that make your community better? In the four years since I've been mayor, I've seen a significant shift.

In Calgary and Toronto, in London and New York, there are affluent people at the city center buying bigger homes, bringing the suburban lifestyle to the city. Out in the suburbs there’s also a lot of wealth. But, as you said, at the other end of the scale, more people and more neighborhoods are struggling. How do we come to grips with the growing class divides facing our cities?

The fundamental building block for a community to work is that neighborhoods are mixed in terms of age, in terms of lifestyle, in terms of income, in terms of background. When we ask people, “What kind of a neighborhood do you want to live in?” people always say the same things: “I want to live in a neighborhood where I can walk to the store”; “I want to live in a neighborhood where my kids can walk to school”; “I want to live in a neighborhood where my kids can go to school with people who are not exactly the same as us, so that they can learn that it takes all kinds to build a society.”

The really troubling stuff is that we are starting to segregate our neighborhoods. And that is a very, very dangerous trend. That's why you need to have entry-level and affordable housing in the same neighborhood as you have mansions.

What are the keys to building those more inclusive, less divided neighborhoods? And what are the tools to ensure that everyone has opportunity? 

In terms of the mixed neighborhoods, it's inclusionary zoning, ensuring that you're building, and you have incentives in place for the private sector to build housing at various different levels for people at different life stages.

In New York City, Mayor Bill de Blasio has developed an ambitious plan for affordable housing. Is charging developers to include affordable housing an important part of the solution?

You have to do it. Not just affordable housing, but market housing at different levels. And the economic levers to make that happen are very complex. When you're building a house, you have three costs: the cost of land, the cost of financing and the cost of construction. Cost of land is the same whether you're building affordable housing or high level housing. Cost of financing is lowest that it's ever been right now, so we should be building tons of rental housing right now.

The shocking part is the cost of construction is the same, whether you're building entry-level housing or high end housing. Once you've poured a foundation, the granite countertops are a very small part of that. So you're always going to have a market incentive to build the high end housing. You've got to figure out ways to mix that up.

The other side of the divide is unemployment, low wages and poverty. There are just too many people toiling in low wage service jobs—as much as 45 percent of the workforce. Add those who are unemployed, those out of the labor force altogether, and those in poverty, and as many as two-thirds of the people in Canada and the U.S. are struggling economically. What can we do to provide better jobs and more opportunity?

Canada's core strength is that we are generous in sharing opportunity with people in our community. I'm not making a left-wing argument that you have to invest only in public, universally accessible stuff. This is actually a social and economic development argument. To be able to live in a society where opportunity is spread across the community, you actually have to fight for it.

It's also about ensuring that you fight against bigotry and small-mindedness and racism and intolerance wherever you see it in the community. If you deliberately craft a society where you say to people there are opportunities that you cannot have, because of how you look, or how you worship, your society will not survive. Being able to build on all of those things and making sure that we continue that generosity of spirit in our community is really important.

Ben Barber wrote a book, If Mayors Ruled the World, that argued that mayors are the best positioned and prepared to deal with future challenges: growing populations, cultural rifts, climate change. American urbanists certainly think their cities need more power. But Canada’s cities have even less power than their southern neighbors. It’s the provinces that hold most of the country’s decision-making power. What can we do about that?

I am the mayor of a city that has more people in it than five provinces. By the end of the 2020s, Calgary will probably have more people in it than six provinces. Yet I have the exact same powers and revenue generating ability as Rosebud, Alberta, population 75. That has got to change. We need to split that into two things. One is decision making authority, and the other is money.

My annual operating budget is about $3 billion a year. Of that, half comes from my only source of taxation which is the property tax, which is the most regressive [form of] taxation you can imagine. The other half comes from user fees, transit fares, things like that. We are very, very lean and very, very tight as a municipal government. We can muddle our way through on the operating side. On the capital side, actually building stuff, my capital budget can go anywhere from $200 million to $4 billion a year depending on the largesse of the other orders of government. This is completely untenable.

So the citizens of Calgary, operating budget $3 billion, send to the provincial government $4 billion a year more than we get in all provincial services. We send to the federal government $10 billion a year more than we get in all services. We don’t begrudge that - the people of Rosebud cannot afford a water treatment plant. It's our job to make sure they have clean water. But those other orders of government need to understand that if they want to keep getting the taxes, when I go to them with my hand out, I'm not asking for a handout, I'm asking for a tax rebate on money that many taxpayers have already spent.

I always make the joke whenever I'm in Ottawa that I can never quite remember what it is that the federal government does. But I'm actually pretty serious. Yeah, they do defense and international stuff. But by and large what the federal government actually does is it writes checks. It collects money, and it writes checks to other orders of government, to individuals, and so on in the community. That is tremendously inefficient. The order of government that has to deliver the services should be able to manage the revenue associated with those services. A lot of people will jump up and down and go, “The mayor is trying to do a tax grab.” But what I'm really talking about is a better sharing of that revenue to ensure that the services are delivered without all that extra administrative cost.

This interview has been edited and condensed for clarity.

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