DEVELOPMENT DERAILED

Copyright © 2013 Max Foran
Published by AU Press, Athabasca University
1200, 10011 – 109 Street, Edmonton, AB T5J 3S8

ISBN 978-1-927536-08-1 (print)  978-1-927536-09-8 (PDF)  978-1-927536-10-4 (epub)

Cover and interior design by Natalie Olsen, Kisscut Design.
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Library and Archives Canada Cataloguing in Publication

Foran, Max
Development derailed : Calgary and the CPR, 1962–64 / Max Foran.

Includes bibliographical references and index.
Issued also in electronic formats.
ISBN 978-1-927536-08-1

1. Economic development — Political aspects — Alberta — Calgary — History — 20th century.   2. City planning — Alberta — Calgary — History — 20th century.   3. Urban renewal — Alberta — Calgary — History — 20th century.   4. Public-private sector cooperation — Alberta — Calgary — History — 20th century.   5. Canadian Pacific Railway Company — Planning — History — 20th century.   6. Railroads — Political aspects — Alberta — Calgary — History — 20th century.   7. Calgary (Alta.)  — Economic conditions — 20th century.   I. Title.

FC3697.4.F676 2013     971.23’3803     C2012-906353-3

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To Rod Sykes, who was there

CONTENTS

List of Tables, Maps, and Figures

Acknowledgements

Introduction

1 Setting the Stage

The City’s Personalities and Agendas, 1953 to July 1962

2 Heady Days of Hope

Two Announcements, June 1962 to April 1963

3 From Arrangement to Agreement

Dodging the Negotiation Potholes, April 1963 to January 1964

4 Temperature Rising

The Project Under Public Scrutiny, February to June 1964

Conclusion

Epilogue

Appendix A Heads of Arrangement

Appendix B Agreement of Intent

Appendix C Major Participants

Appendix D Calgary City Councils, 1962–64

Notes

Bibliography

Index

TABLES, MAPS, AND FIGURES

Tables

1 Population of Calgary, 1944–64

2 Building permits issued in Calgary, 1944–63

Maps

1 CNR and CPR rail routes to city

2 Rail relocation and parkway proposal

3 Rerouting proposals

4 Route of parkway as presented to City Council, December 1963

5 Location of Hudson’s Bay warehouse and the proximity of proposed rail and parkway routes

Figures

1 CPR right-of-way, looking east, 1962

2 Total downtown office construction by blocks, 1946–63

3 The Palliser Hotel, on 9th Avenue

4 South bank of the Bow River, 1955

5 Projected development between 4th Street West and 1st Street East

6 Spur line in warehouse district, 1955

ACKNOWLEDGEMENTS

I would like to thank the people at the City of Calgary Archives. As always, they were very accommodating in helping me locate documents and guiding me to sources I might otherwise not have consulted.

My special thanks and appreciation go to Rod Sykes. He made his private files available to me and consented to their transferral to the University of Calgary Archives following the completion of this manuscript. Blessed with an incredible memory, he was unfailingly patient and generous with his time and extremely helpful with his comments and observations. I especially appreciated his neutrality regarding my interpretation of events as they pertained to the CPR.

DEVELOPMENT DERAILED

Introduction

Life is a strange mixture of black and white, and nowhere will a person encounter more striking extremes of joy and sorrow, headaches and thrills, bouquets and brickbats than in public service at the civic level. There, close to the people, close to the wallets from which taxes are paid and close to garbage can problems, politics can be at their roughest.

Grant MacEwan, diary entry, spring 1963

In June 1962, the Canadian Pacific Railway Company (CPR) unveiled plans to redevelop part of its right-of-way in the heart of downtown Calgary. Covering two blocks to the east of the historic Palliser Hotel, the multi-million-dollar project envisaged retail, office, and convention facilities, as well as a major transportation centre, and it was to occupy land that was currently underused and only marginally developed. The news was received ecstatically by local political and business leaders, who foresaw increased tax revenue and a reversal of the urban blight that was depressing land values and discouraging investment. A year later, the original concept was expanded and took official form through an agreement between the City of Calgary and the railway company. The new plan would involve developing a much larger area, as well as removing all railway tracks from the central downtown area and rerouting the main line along the south bank of the Bow River. Despite the best intentions of its supporters, this grand design for the reshaping of Calgary’s downtown proved too much for the unlikely partners. Changing perceptions of the project and disagreement over details were compounded by ill-preparedness, indecision, inefficiency, poor communication, and mistrust. Calgary’s most controversial and far-reaching project to date died in June 1964 amid the weariness of mutual default.

THE CONTEXT

The city’s agreement with the CPR was born in optimism and rooted in the transformations that were changing Canada’s urban landscapes in the post–World War II era. Two main factors were at work. Together, they combined to create an urban space much different from the industrial city, where land-use patterns were undifferentiated and concentrated around the downtown core. The first was the advent of the Central (later Canada) Mortgage and Housing Corporation (CMHC). Created in 1945 to administer federal participation in housing under the National Housing Act (1944), the CMHC implemented the affordable lending and mortgage insurance policies that helped transform the nation’s spatial residential patterns.¹ The resulting suburbanization of Canada was reflected in the more than three million dwelling units constructed between 1945 and 1970. The second factor was the affordability of the car. In the period up to the 1980s, and arguably still today, planning policies and practices were built around the need to accommodate suburbanization and the automobile.² Every city, it seemed, had a transportation plan calling for the construction of freeways.³ Planners Gerald Hodge and David Gordon sum up the new order of that time: “Mass automobile ownership and expressways gave Canadians a transportation alternative that was private, convenient, flexible and fast.”⁴ A focus on detached housing, bigger and wider freeways, the outward alignment of industrial areas, and the decentralization of retail and other services were dominant themes in the city plans that began emerging in the 1950s and 1960s.

One serious casualty in this transformation was the inner city — in particular, the downtown core. Increasingly, inner-city residents were moving out to the new suburban utopias. Shoppers were not patronizing downtown retail establishments as they once had, preferring instead to avail themselves of the newer, handier malls that included the big anchor stores and, more importantly, that offered free parking. The 43,000 suburban dwellers who worked downtown in 1963 faced traffic congestion while getting there and parking problems when they arrived.⁵ In this period, the troubling question of what to with downtowns — with their limited access, their aging infrastructure, and their declining importance amid residential flight and diminishing shopper interest — was almost as important to city managers and planners as the need to accommodate outward growth.

Solutions were limited. Access to downtown could be alleviated via freeways. For example, the 1959 plan for Metropolitan Toronto provided for over a hundred miles of expressways.⁶ In Ottawa, the Queensway was constructed as an east-west crosstown route in the 1960s. However, expense and rising public opposition proved to be limiting factors. Another way to bring people back to downtowns was through the enticement provided by modern new development or, to be more accurate, redevelopment. In this period, however, venture capital was scarce in downtown areas, where the attendant risks of redevelopment were high. In addition to risk, potential investors worried about higher property taxes offsetting any rental gain achieved through redevelopment.⁷ In fact, many investors believed that the best economic returns could be obtained by razing older buildings and using the vacated land for parking until the development value of the site reached its maximum potential.⁸

The impetus to redevelop Canadian downtowns fell largely to the public sector. Sometimes it occurred at the local level, where civic governments promoted redevelopment on their own land and at times sold it at premium prices to encourage private redevelopment. It took the form of new civic facilities. Another intervention was through the federally sponsored urban renewal programs under the National Housing Act of 1944 and its subsequent amendments. Originally, such schemes involved the demolition of existing degraded housing in inner-city areas and replacing the demolished homes with higher-density public housing complexes. The scope of the act was later widened to include commercial redevelopment.⁹

The emphasis on redevelopment rather than on other options like rehabilitation or conservation created a mindset that saw change in terms of fresh beginnings. Regardless of its form or its impact on other variables, redevelopment was perceived as a natural good. With plenty of architects and designers willing to offer their visions for the future and many construction companies ready to enable them, any change was good change as long as it involved newness. This fixation with modernity had mixed results. Especially in terms of housing, the urban renewal movement of this period with its “bulldozer” techniques produced a “newness” that often did not stand the test of time.

Despite the later criticism of publicly supported urban renewal projects, there is little doubt about their influence as change agents in downtowns. Market Square in St. John, Scotia Centre in Halifax, Lloyd D. Jackson Square in Hamilton, Toronto’s City Hall and Civic Centre, Regina Centre in Regina, and Churchill Square in Edmonton stand as testimony to public sector involvement in helping to redefine Canadian downtowns.

There was, however, at least one private enterprise with an interest in urban land, a business that had a strong physical and economic presence and was in the throes of a massive transformation. Beginning in the mid-1950s, the Canadian Pacific Railway began shaking off its “encrusted with tradition” reputation.¹⁰ The reason was simple. Money! The company had always seen its future in terms of transportation and related enterprises, primarily the railway. However, the former mighty agent of Sir John A. Macdonald’s National Policy was facing hard times. Between 1928 and 1953, thanks to a combination of locked-in freight rate agreements, competition from the Canadian National Railway (CNR), and increased use of automobiles and semi-trailers, the CPR had seen its share of the country’s rail freight business decline by over 25 percent and passenger traffic by two-thirds. In 1955, when Norris Roy (Buck) Crump took over the presidency, he inherited the company’s largest debt since 1941, the highest fixed charges since 1948, and the lowest return on revenue since 1922.¹¹ In 1960, the return on railway investment was a dismal 2.8 percent. Railway profits contributed 73 percent of the CPR’s net income in 1956, but in the next four years, they plummeted from $3.76 to $1.81 per share.¹² Passenger traffic was the hardest hit. By 1962, it was contributing only eight cents for every dollar earned. The “crippled Titan” needed healing.¹³

Though he was an inveterate railway man, Crump was responsible for initiating the process that moved the CPR in a new direction. Between 1956 and 1963, he instituted a comprehensive inventory of the company’s non-transportation assets, which amounted to approximately 1.4 million acres in western Canada and substantial holdings in the hearts of most of the nation’s leading cities. Crump’s choice for overseer of the development of these non-transportation assets was his Winnipeg-born vice-president, Ian Sinclair. It was a sound decision. With his powerful, dominant, no-nonsense personality, and without the constraints of a railway background, Sinclair was the ideal man for the job. Turning his back on the old way of doing things, in which the CPR had rented its farmlands and allowed its mineral and timber lands to be developed by third parties in return for royalties, Sinclair set the stage for the future when he declared, “We are going to start running this company ourselves.”¹⁴ This move toward diversification was helped further by the MacPherson Royal Commission, formed by the Diefenbaker government in 1959 to investigate national transportation policy and freight rates. In its report in 1961, the commission reinforced the need for further diversification by recommending a rationalized approach to uneconomic railways.¹⁵ One immediate result was Sinclair’s formation in 1962 of Canadian Pacific Investments, an umbrella company to hold all non-transportation assets. Through the late 1950s and 1960s, these included mining, smelting, other mineral holdings including potash (Cominco), oil and gas (Canadian Pacific Oil and Gas), pipelines (Bow River Pipelines), and lumber (Pacific Logging Company).

Urban land development was intended to be part of the CPR’s diversification program, but it was slow to take hold. Initially, the company’s interest in its substantial landholdings in cities involved sales (in Vancouver) and attempts to maintain its tax advantages (in Winnipeg).¹⁶ Although its real estate subsidiary, Marathon Realty, was formed in 1963, the CPR was not a big player in urban land development until the late 1960s and beyond. Be that as it may, the fact remains that by 1962, the combination of the CPR’s diversification program and its desire to move out of unprofitable railway enterprises had put its big right-of-way in downtown Calgary into a new perspective.

The fact that urban land development was not high on the diversification agenda had implications for the Calgary project. Its significance lay in that urban land development represented a new twist in a period of profound transformation for the CPR. Moreover, it was different from owning and operating a resource-based enterprise. It was not product oriented. It demanded judicious choices regarding how much land to own, sell, or lease; how much to develop and operate; and how to integrate significant capital investment in space and over time. In 1962, the CPR had no experience in negotiating these variables.

But that is not to say that nothing had been done in other Canadian cities where the railway tracks and facilities in downtown areas had become liabilities. The two big American precedents and models were in Pennsylvania and involved the development of the Penn Centre in Philadelphia and the Gateway Center towers in Pittsburgh.¹⁷ In Canada, the active participant was the CNR, not the CPR, partly because the former, being a public corporation, invited closer association between levels of government. The first rail relocation project was undertaken in Ottawa in the mid-1950s when the CNR agreed to remove thirty-five miles of track and eliminate seventy-seven level crossings to enable the release of 251 acres for parks and public building sites and to provide the right-of-way for the Queensway. In 1962, the Place Ville Marie in Montréal, one of the first designs of Henry N. Cobb and I.M. Pei, grew from a railway trench dug out of Mount Royal between the southern portal of the CNR’s Mount Royal Tunnel and Central Station. It was erected over a fifteen-metre-deep open cut containing the railway tracks, and, when completed, the seven-acre project combined a forty-two-storey office tower with new and existing buildings atop a public plaza. In Saskatoon, under a downtown revitalization project that began in the 1950s, the CNR yards were removed and replaced with the Midtown Plaza shopping mall and the Saskatoon Centennial Auditorium and Convention Centre.¹⁸ Although the CPR would later be involved in similar projects, such as the Metro Toronto Convention Centre, on the city’s waterfront, or False Creek, in Vancouver, the Calgary project was regarded as its guinea pig.

Calgary was a logical choice of a location in which to explore the urban land development business. The company had a significant presence in Alberta, primarily through its oil and gas interests, and its leadership believed that the province offered boundless opportunities. The vice-president of the company’s Natural Resources Department, Fred Stone, a former secretary to William Aberhart, was on good terms with current premier, Ernest Manning. Furthermore, Calgary’s status as the headquarters of a promising fossil fuel industry was undisputed, even if it still lacked the office towers to prove it. Of equal significance was the fact that the railway’s downtown right-of-way was broad, long, and underused.

The CPR–City of Calgary redevelopment proposal was thus set against broad urban transformations that were militating against downtown economic and demographic health, and amid challenges raised by changing railway dynamics. It was also acted out in a local context where history and circumstance played important roles.

At the end of the Second World War, Calgary was a provincial city of some one hundred thousand people; its main claim to urban distinctiveness was its location within sight of the Rocky Mountains. It was thirty-three years removed from its heyday in 1912, and the value of the building permits issued in that year had yet to be surpassed by the value of those issued in any subsequent year. Its downtown was dominated by sandstone structures that, although handsome, scarcely provided the sort of skyline consistent with the truly modern city. Its urban environs stretched well beyond that demanded by population, and many of the empty land parcels and lots were owned by the city via tax default. The Turner Valley oilfield southwest of the city had brought a modicum of excitement and prosperity, but it was already a declining field and whatever interest the major oil companies had in the city was wearing thin. Other, more promising places beckoned. There had been virtually no construction in the city since 1914, and visitors from the east alighting from the train at an unremarkable and aging station saw little to enthrall them. In all, it was a city that reflected its modest role as a distributing centre for south and south-central Alberta, an area not long removed from the ravages of a decade-long depression and whose agricultural wealth fell far short of that around Edmonton.

Local government reflected the mentality of a city that thought it was going somewhere in the years before World War I but was now stalled in a time warp. In 1914, British landscape designer Thomas Mawson had prepared a grandiose plan for the future Calgary.¹⁹ It now lay forgotten in a file somewhere in City Hall. The only positive the city had to show for its tinkering with the idea of urban planning in the late 1920s was a zoning bylaw enacted in 1934. The senior executive consisted of a mayor who had occupied the office for fifteen years and a lone elected commissioner. Change was not in the offing. There was no civic vision in a city that fifty years earlier had seen its future as the “Chicago of Canada.”

This situation was to change dramatically in 1947 with the discovery of Devonian reef oil at Leduc. The beginning of the oil boom transformed Calgary. The city entered the 1950s flexing new muscles and talking about growth. Population increased dramatically, from about 97,250 in 1944 to almost 295,000 in 1964. Construction returned. The value of building permits issued in 1944 was $7.2 million; in 1958, the figure topped $100 million. Civic revenues jumped from $5 million to $45 million between 1947 and 1963.²⁰ The city began expanding in all four directions, particularly to the south and northwest, where well over 60 percent of the residential dwellings were single-family, detached houses. The City Act of 1952 professionalized the civic executive by replacing elected commissioners with appointed experts. As a result, the city appointed a finance commissioner and a public works commissioner in 1953 and, in 1960, added the position of chief commissioner. A trained city planner was appointed in 1952. A mandate was received from the province to prepare a general plan. Later in the decade, a royal commission on metropolitan development gave the city the go-ahead to plan its transportation corridors to coincide with expanded city boundaries.²¹ A revised zoning bylaw was in place by 1958, and the decade ended with the preparation of a new transportation plan, which included provisions for one-way couplets (that is, pairs of adjacent streets, one running in one direction and the other in the opposite direction) and inner and outer ring roads all designed to move cars around and through the city. In 1944, Calgary had 66 miles of paved roadways; in 1964, the figure stood at 559, while in the same period, the number of registered vehicles had risen from 13,035 to 124,469. Although growth had stabilized somewhat since the frenetic years of the late 1950s, in 1962 Calgary was ranked the fifth fastest-growing city with a population over one hundred thousand in North America.²² For the first time in fifty years, the dream of greatness had returned.

Table 1 Population of Calgary, 1944–64

SOURCE: City of Calgary Archives, Municipal Manuals.

Table 2 Building permits issued in Calgary, 1944–63

SOURCE: City of Calgary Archives, Municipal Manuals.

What was missing in this exciting maelstrom of change in the 1950s and early 1960s was a vision for the future. The change had come too quickly. For instance, in terms of providing housing, the city was simply playing catch-up and transferring more and more power to private developers.²³ Even an awareness of urban renewal was late in coming. A booster-type mayor with limited experience in urban issues was at the helm for most of the decade. City councils mostly comprised stolid conservative businessmen steeped in the practice of guarding the public purse.²⁴ Although a more dynamic executive was in place by 1960, one ready to assume leadership, its members, too, were fixated on freeways and redevelopment.

According to a contemporary planning consultant, planning in this period was all about aggregate growth and the need to accommodate and promote it.²⁵ The City of Calgary’s planning philosophy through its first general plan clearly reflected this blinkered mentality. Released in August 1963, the plan reinforced current growth patterns by encouraging automobile use, extensive private transportation infrastructure, low-density housing, and decentralized industrial areas.²⁶ “No consequential changes of policy can be immediately foreseen,” city planners predicted. The plan went on to indicate that future development should reflect existing trends and constraints. This endorsement of private transportation on expressways, main roads, and feeder links is best reflected in a telling statistic. In 1944, Calgary’s public transit system had carried twenty-six million passengers. Twenty years later, when the population had grown threefold, the corresponding figure was twenty-four million.²⁷

This lack of vision was compounded by the fact that the City of Calgary General Plan made no provision whatsoever for the downtown area. Apparently, it was to be prepared at a later date. The reason was simple: no one knew how to proceed. There was no coordinated vision of what the future downtown should look like. There was no recognition of the potential of existing natural features like the two riverbanks, no sense of the aesthetic, no thought of a new type of downtown that might cater to a different clientele. The only solution, it appeared, was simply to reverse the trend that by 1960 had given the downtown only 25 percent of retail sales and 12 percent of construction projects.²⁸ Not surprisingly, city officials were hoping that an outside consultant would tell them exactly how to do this.

Like many Canadian cities, Calgary operated on a commission form of government. Commissioners, the most senior executives, were appointed by City Council to head the various civic departments and to report and recommend to the council either individually or through the chief commissioner. In the power relationship between the civic executive and City Council, the former was usually dominant in prosperous times. Jack Masson, in his study of local government in Alberta, suggests that city councils in this period routinely endorsed 75 percent of the recommendations that came to them.²⁹ In Calgary’s case, this figure was probably too low. Administrators like Mayor Harry Hays or Commissioner John Steel believed that City Council’s decisions should be based solely on executive recommendations, particularly in third-party negotiations involving secrecy and confidentiality. The information gap inherent in this process was a major factor in derailing the project.

This, then, was Calgary on the eve of the big project: a city being led by its own energy toward a future where growth was the only goal. It all seemed to be about “getting there,” except that no one seemed to know where “there” was. In the context of civic thought, the idea of a big agreement with the CPR was as close as it came to knowing where “there” was.

THE BACKGROUND TO THE PROPOSAL

The project was so ambitious that its scope alone was enough to make up for any lack of vision. While the long-range value of the project reached into the hundreds of millions of dollars, the CPR’s willingness to invest $35 million within seven years represented a mind-boggling commitment. To put this figure into perspective, it was about three times the city’s annual capital expenditures and not much less than the total civic revenues for 1962.³⁰ When the idea for the project was suggested in 1962, both daily newspapers could scarcely contain their joy. The Albertan thought it was “too good to be true” while the Calgary Herald labelled it as “a plan of great vision, of great imagination, of great value . . . a plan that will make history.”³¹ Even The Globe and Mail was impressed. After noting that “Calgary is a guinea pig for developments in other cities,” it congratulated Calgarians for having “a straitjacket removed.”³²

Calgary and the Canadian Pacific Railway were bound together by time. The railway company had laid out the townsite in 1884 and, over the years, had continued to play a major role in the city’s physical and economic development. Its transcontinental line enters the city from the southeast, crosses the Elbow River west of 8th Street East and proceeds westward through the downtown between 9th and 10th Avenues. Beyond 14th Street West, it follows the south bank of the Bow River out of the city. In the 1960s, the CPR right-of-way in the downtown area was four hundred feet wide, totalling 108 acres and encompassing twenty blocks between 6th Street East and 14th Street West. In 1960, 57 percent of this land was taken up by the main line and spurs, sidings, and yards. Another 17.6 percent was given over to railway buildings and service facilities, and 24.4 percent to one-year leases to various commercial enterprises.³³ Except for the portions under lease, this wide right-of-way, if used for railway purposes, was exempt from taxation under the 1881 contract between the federal government and the CPR.³⁴ It was on this right-of-way, with an emphasis on the area between 1st Street East and 4th Street West, that the CPR–City of Calgary redevelopment proposal was focused.

Map 1. CNR and CPR rail routes to city

Figure 1. CPR right-of-way, looking east, 1962. In the foreground are the downtown station facilities; the large building in the background housed the CPR’s Natural Resources Department. Under the proposed plan, this area would have been the first to undergo redevelopment. Source: Courtesy of Rod Sykes.

Calgary’s 536-acre city centre was (and still is) compressed between the CPR right-of-way and the Bow River to the north. Commercial expansion had been following a westward pattern since rapid urban growth had begun after 1947. The right-of-way was a limiting factor to commercial development to the south, and it restricted traffic access to and from the fast-growing southern residential areas. On the south side of the tracks along 10th Avenue, a line of old warehouses and other structures presented a stark and ugly contrast to the city’s emerging skyline north and west of the railway.

The CPR wanted to reverse its declining revenues from prime urban property in the downtown area. From 1958 to 1962, total carload traffic on its roughly 170 miles of trackage in the city had dropped from 67,214 to 59,972, with the downtown percentage falling from approximately 20 percent to 17.9 percent of the total. This trend was expected to continue. In 1962, of the carloads that originated in the downtown right-of-way, 83 percent were from three customers, with the largest, Robin Hood Mills (at 57.9 percent), destined for relocation.³⁵ The consolidation of the CNR’s presence in Calgary via increased trackage was another worrying factor. Since opening its new industrial subdivision at Highfield in 1954, the CNR had lured forty companies, or three thousand carloads of business, from the CPR, including McCoshams and Martin Paper Products.³⁶ Noting that Highfield had fifty unused acres of fully serviced land, a senior official with the CPR noted, “It’s just going to get worse.”³⁷

The City of Calgary’s most degraded area was parallel to the railway right-of-way in the east end. By the mid-1950s, the area to the east of Centre Street, and particularly that adjacent to the right-of-way, was deteriorating in value and appearance. For example, between 1946 and 1963, construction on the seventy-seven acres in the two leading business districts west of Centre Street totalled $87.5 million. On Canadian Pacific property (ninety-nine acres), it was $5.9 million. By 1963, the value of construction in the two leading business districts was over $1 million per acre compared to $59,000 per acre on land adjacent to the right-of-way.³⁸

Figure 2. Total downtown office construction by blocks, 1946–63. Source: Eric J. Hanson, “City of Calgary CP Railway Downtown Development Proposals,” report submitted to City Council on November 7, 1963.

In terms of this project, it would be difficult to find a situation more beneficial for both parties. For the city, the redevelopment project promised to end blight east of Centre Street, increase revenues, remove a major physical barrier, and restructure the downtown.³⁹ The CPR envisaged considerable outside investment on its redeveloped right-of-way, resulting in substantial rental revenues from office towers, retail facilities, hotels, a convention centre, and transportation facilities shared with the city.

Yet despite these mutual advantages, the CPR and the city were unlikely partners. A national corporate leader, the CPR was a powerful corporation with a conservative, hierarchical structure and culture. Historical precedent had given the company a dubious reputation in the city for high-handedness. Moreover, the CPR came into the agreement with no knowledge of urban land development, uncertain long-range goals with respect to the same, and a risk-averse bargaining style. The city was equally ill-equipped to negotiate a major agreement. Civic leaders entered the agreement with an attitude toward their giant partner that may be best described as part awe, part suspicion. They were also inexperienced, lacking both preparation and an integrated vision.

As with other railway relocation projects in Canadian cities, this project has received scant academic attention. Jean Leslie devoted over fifty pages to the issue in her 2004 biography of her husband, Jack Leslie.⁴⁰ Her account provides some excellent details, while also offering some insightful first-hand observations on the local political arena and its participants. However, it is too sweeping in its conclusions, and, by beginning her discussion in 1963, Leslie fails to deal with the important background details that would contextualize the issue more fully. Similarly, historian H. V. Nelles gives a briefer encapsulation in his 2005 article, “How Did Calgary Get Its River Parks?”⁴¹ As his title suggests, Nelles was not interested in the project itself but rather in using its failure to explain the later evolution of Calgary’s river parks system. Marjorie Norris also deals with the issue in her history of the Calgary Local Council of Women (1995).⁴² However, as with Nelles, her treatment, though insightful, is more a narrative than an analytical discussion. Aside from the above treatments, all enclosed within wider discussions, the story of Calgary’s most ambitious downtown redevelopment project and the CPR’s grand blueprint for Calgary and urban development elsewhere has not been fully told.

The following discussion deals with the proposed project from its promising inception to its quiet death. While I do try to identify pivotal points of departure between the two participants and places where both might have acted otherwise, the focus is not on who was to blame. Rather, the emphasis is on the negotiating process itself. In the final analysis, both the city and the CPR were unable to provide definitive answers to each other’s questions because neither had any.

1

Setting the Stage

The City’s Personalities and Agendas, 1953 to July 1962

As already indicated, the lack of downtown parking in Canadian cities was seen as a major deterrent to cars, people, and patronage. Calgary was no different. The need to increase the parking capacity of the downtown core focused original civic interest on the wide, underused CPR right-of-way. The parking negotiations carried out in the 1950s shed light on the attitude of the CPR and revealed the disconnect between City Council and senior administration. The failure of those negotiations also set the stage for the emergence of two vital change agents: Mayor Harry Hays and the CPR’s Rod Sykes. Their combined efforts resulted in the first statement of interest in redeveloping the right-of-way.

THE CITY’S PUBLIC AGENDA: PARKING FACILITIES

The city’s first interest in using the CPR right-of-way emerged in 1953, when a Planning Department report suggested building a parking structure over the right-of-way between 1st and 4th Streets West.¹ CPR officials were cool to the suggestion, believing it to be uneconomical. They also wanted assurance that rail operations would not be affected.² Jack Fraine, the CPR’s regional vice-president, also reminded the city that a similar idea in Vancouver had been rejected as financially unsound in spite of obvious convenience factors.³ When the idea was resurrected two years later, it was clear that while City Council and segments of the public were enthusiastic, city administrators remained as pessimistic as the CPR. The provision of public parking structures was an expensive proposition. In replying to an inquiry by Alderman Mary Dover in May 1957 on the possibility of parking over the railway tracks, the commissioners reported that the proposal would require the city to spend $10,000 to $15,000 merely on preliminary plans and consultation fees and declared that “the commissioners do not feel that such an expenditure is warranted at this time.”⁴ In support, they offered estimates of $423,000 for a structure with a capacity for 262 cars behind the railway station, $692,000 for a 400-car facility between 9th and 10th Avenues, and $1,091,000 for a big parkade for 783 cars between 1st and 4th Streets West. In asking Fraine for his opinion, the commissioners were openly negative, noting that “in view of the publicity this project has received we feel obliged to process it to the final stage.”⁵ Doubtless, the commissioners felt they had put the matter to rest by December 1957, when they reported to City Council that their meeting with the CPR had produced little co-operation. City Council was informed that if a parking structure was built to federal specifications, it would be “a very costly undertaking” involving a very large supporting structure with beams up to seventy feet in length.⁶ In other words, forget it.

If the commissioners thought that the project had gone away, they were wrong. It was kept alive by interest groups like the Downtown Businessmen’s Association, which began a dialogue with the CPR in 1958.⁷ Then, in late 1959, the Planning Department, which had suggested the idea in the first place, came up with another proposal to build a series of six multi-storey parking buildings between 5th and 9th Streets West for six thousand cars.⁸ Again, other forces within the civic administration demurred. This time it was the city’s Downtown Parking Corporation, whose superintendent, Rees Taprell, believed that while the proposed facility had some merit for the future, it would not be approved by the railway company.⁹ Downtown parking problems continued. The city entered the 1960s with six public parking lots, one structure, and 2,041 parking meters for a total of 2,900 spaces. In 1963–64, more than 124,000 vehicles were registered in the city.¹⁰

Taprell was right about CPR approval. President Crump was simply not interested. However, in rejecting the parking concept, he opened what had hitherto been a closed door: “We have no objection at all to joining with the city in a study aimed at utilizing to a greater advantage any property we may have. We will listen to anything to our mutual advantage.”¹¹ It was an interesting comment. That Crump was prepared to wait on the city’s initiative is an indication that the CPR had not yet developed any plan of its own for its right-of-way in Calgary.

THE CHANGE AGENTS: HARRY HAYS AND ROD SYKES

Buck Crump’s comment was propitious, for a month earlier, in October 1959, Calgary had elected a new mayor. If one had to identify the major individual change agent behind the redevelopment scheme, it would have to be Harry Hays, the rancher, auctioneer, livestock breeder, and dairy farmer who had just unseated longstanding mayor Don Mackay in a closely fought election.¹²

Hays was an intriguing character. Self-described as “a barefoot boy from the backyard,” he was born in Carstairs, Alberta, in 1909. Following the completion of a course at Garbutt’s Business College in Calgary, he became a field man for the Holstein-Friesian Cattle Exporting Association. Over the years, he gained a reputation as an innovator and cattle breeder. The Hays Converter was the first breed of beef cattle recognized as a pure breed under the provisions of the Canada Livestock Pedigree Act and developed by a Canadian livestock producer. Hays was the first Canadian to ship purebred dairy cattle to Great Britain and was instrumental in introducing the modern public stock auction to Alberta. In the 1950s, he pioneered the export of cattle by plane, allowing the Canadian industry to develop new markets in Mexico and the United Kingdom. Hays was also involved with the Canadian Swine Breeders during World War II in initiating the “Bacon for Britain” campaign to increase production as part of the war effort.¹³

Homespun, down to earth, but shrewd and with a no-nonsense attitude toward business, Hays had never run for political office. It was generally believed that he finally did so at the urging of business colleagues who were concerned about the city’s rising debenture debt, which reached $82 million in 1960. In 1948, it had been under $9 million.¹⁴ Another likely motivator was the recent sale of his dairy farm (now the suburb of Haysboro) on the city’s southern outskirts to a land development company for $1 million.¹⁵ Surplus cash and a new interest in urban growth probably made running for civic office appealing to an individual accustomed to risk taking and challenge and with an established reputation for getting things done. In his campaign, Hays promised more efficiency in government, the creation of a robust business climate, and few specifics. It was enough to push him just ahead of his opponent, incumbent Don Mackay, a flamboyant character whose eight-year term had been tainted by a civic scandal involving spending improprieties and alleged kickbacks.

Hays soon gained the confidence of City Council, a luxury he was to retain for the duration of his term in office. In fact, some thought that City Council was a pawn in his hands. Nevertheless, he made good on his promise to reduce debt. Claiming that he had lowered the per capita debt by eleven dollars, he secured a landslide victory in the mayoralty election in 1961.¹⁶ Then, at the beginning of his second term, he implemented a “hold-the-line policy” that reduced expenses further through an across-the-board wage freeze for city employees. As his mayoralty term progressed, it was obvious that City Council trusted Hays, the city commissioners trusted Hays, the press liked Hays, the public liked Hays, and, most significant for the big project that he was about to get underway, the federal Liberal government came to really like Harry Hays.

Following his second election in the fall of 1961, Hays began his campaign to do something about the CPR right-of-way. In a series of communications to Crump, he blasted the railway company for its inactivity on its wide right-of-way, arguing that CPR apathy was responsible for the urban blight that was steadily creeping westward along 9th and 8th Avenues.¹⁷ His message was simple: something needed to be done. Although the CPR’s interest in Calgary at this time mainly concerned property acquisition for outlying industrial parks, Crump was sufficiently surprised by Hays’s vehemence to take action, and he turned the matter over to his right-hand man, Vice-President Ian Sinclair. Always mindful of possibilities, Sinclair directed Rod Sykes, his protégé in the CPR’s Research Department, to go to Calgary and check things out.¹⁸ Although Sykes remembers his assignment as “getting Hays off Crump’s back,” it is also likely that the outspoken Calgary mayor had piqued some high-level company interest.¹⁹

If Harry Hays was an intriguing figure, James Rodney (Rod) Winter Sykes was equally so. Born in Montréal in 1929 and educated in Victoria and at Sir George Williams University (now Concordia), Sykes began his career as an accountant in 1949, articling with Price Waterhouse before becoming a chartered accountant in 1954. He joined the CPR in 1960 under interesting circumstances. When auditing the CPR’s books for Price Waterhouse, he concluded that the company’s Esquimalt and Nanaimo timberlands were being grossly mismanaged. He was forthright enough to confront the formidable Sinclair with this belief. Impressed with the young man’s candour and probably recognizing a kindred soul, Sinclair persuaded Sykes to leave Price Waterhouse and join the CPR’s Research Department, where he was put in charge of investigating non-transportation resources. This included identification, profitability, priority assessments, and recommendations. His first assignment involved the Pacific logging industry, where he arranged the purchase of Sooke Forest Products Ltd., an investment that the CPR recovered in a year. His second was in Saskatchewan, where he worked with Stanford Research Institute to produce a detailed assessment of the company’s potash holdings.²⁰

Sykes brought a significant presence to his duties. Most Calgarians old enough to remember will associate Sykes with his later role as mayor of Calgary, a position he occupied from 1969 to 1977, during which time he gained a reputation for bluntness and confrontation and for being convinced of the certainty of his own opinions. One columnist described his political style as “abrasive, divisive and theatrical.”²¹ He was, however, highly respected and voter-friendly. In 1974, Macleans Magazine ran an informal survey on the popularity of Canada’s mayors. Of the 359 responses, Sykes received the most endorsements. The winning entry praised “his intestinal fortitude to put the cards on the table for all to see.” When he left the mayoralty in 1977, he was described by respected Calgary columnist John Hopkins as a man of sharp contrasts, a formidable adversary, and a tireless worker; Hopkins declared that “anything he did was in the best interest of the city.”²²

Sykes was to be a major figure in the CPR–City of Calgary project and his role should be put into context. With respect to land development issues, his authority in Calgary exceeded his position within the company, partly because of his bond with Sinclair, an unlikely situation given Sinclair’s impersonal staff relationships.²³ Doubtless, Sykes’s forthrightness earned Sinclair’s respect. They also shared the same volatile temperament. Sykes’s incendiary wit was once described as having the potential to “start a blaze in a fire extinguisher factory.”²⁴ As for Sinclair, he was quoted as saying, “I don’t get heart attacks, I give them.”²⁵ While he reported to Fred Stone, who occupied the newly created position of vice-president of the Natural Resources Department, Sykes was also Sinclair’s personal agent in Calgary with a mandate to push his authority as far as it would take him. As Sinclair himself once said, “If you make a decision and you’re running the team, you make the decision.”²⁶ The vice-president’s confidence was based on more than Sykes’s impressive achievements in a short time with the company. Sinclair was also aware of Sykes’s proven ability as an auditor with a globally recognized accounting company, where he was accustomed to speaking his mind to senior corporate executives. In Calgary, when Sykes spoke on matters of land development, it was with the CPR’s voice. The same was not as true for railway issues: the rerouting of the rails was outside his purview, and he did not lead the negotiations. He was also not given free licence to sell the project to the city.

When Sykes arrived in Calgary to deal with Harry Hays, the CPR had prepared no plans for doing anything with its right-of-way. He had no instructions beyond seeing what Hays was all about.²⁷ For all Sykes knew, Hays might have simply been testing the waters in a game the CPR often played with urban planners who wanted the company to spend more money in their cities. But a tour with Hays along the right-of-way convinced him otherwise. Sykes was dismayed by the sight of prime urban land languishing amid rusting spur lines and weeds. But he was equally energized by the possibilities it presented and was infused with the belief that he had a crucial role to play in a company that was moving away from railway-based enterprises. In that respect, he was one of those “clever managers” described by Robert Chodos: those who hated “to see properties lying idle and who saw the potential for Canadian Pacific to enter the glamorous and lucrative field of real estate development.”²⁸

Sykes recognized the potential in Calgary and told Sinclair so back in Montréal. Trusting his young protégé, who reminded him of himself, Sinclair agreed and sent him back to Calgary to research the possibilities, prepare an economic study, and make recommendations.²⁹ Sykes was back in Calgary in the spring of 1962 and, after taking up residence in the Palliser Hotel, began preparations for the economic study. A further priority was to reconnect with Harry Hays and to acquaint himself with key members in the city’s Planning Department. He also began to get a feel for the press and the local business establishment. On April 12, Sykes met with the city’s planning director, Al Martin, who, after admitting his ignorance of the talks between Hays and Crump, offered the opinion that the current right-of-way should be narrowed considerably through development. Sykes agreed but offered no details.³⁰ Over the ensuing weeks, Sykes worked with the Planning Department on possibilities for the right-of-way.

³¹