Revised no-cost Calgary to Banff rail deal hinges on province's rail master plan

Proponents of a commuter rail connecting Calgary to Banff hope to sweeten a deal with the province in response to Alberta’s rail master plan which envisions tying the Rocky Mountain parks to Calgary, Edmonton and surrounding communities via passenger rail.

In a move it hopes will help facilitate this, Banff-based Liricon Capital and its development partner, Plenary, say if the province builds a rail line from the Calgary International Airport to a central terminal in downtown Calgary, connects regional rail with the city’s Green Line and fixes a downtown pinch point, Liricon and Plenary will develop, build, and operate a line from the city to Banff at no cost to the province.

The proposal also requires the Calgary airport to downtown track to allow three Calgary to Banff trains per hour.

“In doing so, we are not asking for any provincial government financial support to run that train,” said Jan Waterous, managing partner of Liricon.

The initial proposal asked the province to support the Calgary Airport Banff Rail (CABR) project with a capped $30 million per year availability payment, which could be less if fares collected from ridership were high but could support the project with no more than $30 million.

Waterous said she believes the project could now do without financial support from the province for two reasons.

“One, this is a project now that we believe will have greater ridership. That is when we tie into the broader master plan for rail in Alberta, we expect that we’re going to have greater ridership than we initially anticipated when we submitted our proposal in November 2021. We think we can take that risk on our own.”

The second reason, she said, is the provincial government recently announced that as part of its rail master plan, it would consider a commuter rail system for Calgary and Edmonton that connects the cities’ respective airports to downtown areas – a costly endeavour CABR was preparing to take on in Calgary.

“We hadn’t figured it out yet and that was something we were about to commence, but it would be an expensive engineering project to get a train through these areas,” said Waterous.

“Now that the province is taking on that risk, or we expect they will, that also de-risks this for us. With those two key points, we believe that we can offer the downtown Calgary to Banff train with zero provincial funding.”

The project would still require support from Canada Infrastructure Bank (CIB).

Liricon and Plenary hope to secure more than $1 billion in committed CIB financing in advance of the next federal election. If the Pierre Poilievre-led Conservative government takes power, it has pledged to remove the federal Crown corporation established in 2017 to invest in and support the development of infrastructure projects across Canada.

The bank provides financing through various means, including loans, equity investments, and loan guarantees, to help make large, complex projects – such as public transit initiatives – financially viable.

In a statement, CIB said it is awaiting the completion of the province’s rail master plan to engage directly with potential investments. The rail master plan is expected to be completed in summer 2025.

“The Canada Infrastructure Bank remains committed to supporting the Government of Alberta in pursuing passenger rail connections in the province [between Calgary, Banff and the other Bow Valley communities] that include long-term private/institutional investment,” it said.

Without CIB, “there is no CABR,” said Waterous.

“The math just doesn’t sketch out for us, so it’s very important that we’re able to use that financing.”

The CABR project hopes to sign a project development agreement with the province by end of June 2025, which is roughly four months before the federal election. The agreement would allow CABR to advance to the design phase and secure funding intent prior to the federal election.

“Between now and then, it’s really more about just getting our own process in order. We are always in consultation with various groups refining our project, whether that be looking at train suppliers and looking at hydrogen trains or anything else,” said Waterous.

“There lots happening between now and then which will not be in the public domain, but still our project moves forward.”

The project also requires agreements with municipalities and Îyârhe Nakoda First Nation, situated along the CABR route, with planned stops in those areas.

With the First Nation, in particular, Waterous said it has been made “abundantly clear” that this requires engagement with provincial and likely federal governments, as well.

At this stage, however, Waterous said the project is in a holding pattern until it can move forward with design.

Canadian Pacific Kansas City (CPKC) will also be a crucial part of project engagement, with the intent to twin passenger rail along CPKC’s existing line.

In a statement, CPKC said any proposal to “co-locate a passenger rail service on CPKC property must preserve its capacity to move freight, both at current levels and those required to support future growth.

“Alberta’s and North America’s economy depends on a freight rail transportation system that can safely and efficiently move goods and commodities, especially through this critical trade corridor,” said Terry Cunha, CPKC spokesperson.

The Outlook contacted Alberta Transportation of Economic Corridors, but did not hear back before publication.

While rail development continues to be a focal point in Alberta’s transportation plans, another significant decision has emerged in Banff with the removal of the Banff pedestrian zone.

Waterous said from where the CABR project stands with its intent to remove vehicles from the road and ease vehicle congestion in Banff National Park and the Banff townsite, the decision was disappointing.

She said she also wonders if the pedestrian zone, along with the decision to remove it, came a few years too early for the mountain town and national park.

“I do believe that you have to have many different pieces of infrastructure to deal with congestion, and so perhaps we can talk about this again in three to five years when we have a train and we have other opportunities for visitors,” Waterous said.

“From where we stand, it’s not about limiting visitation, it’s really about changing how people move through the park and to do that you have to provide lots of options, and in doing so make the visitor experience better. It’s not going to be something that will hurt the visitor experience. It will make it better, as well as being better for the environment,” she added.

“Maybe it was an idea that was just a little bit too early for the community.”

The Local Journalism Initiative is funded by the Government of Canada. The position covers Îyârhe (Stoney) Nakoda First Nation and Kananaskis Country.