How a city organizes its space—its land use and population density—has a profound impact on its financial health and the daily lives of its residents. Denser, more compact urban areas are better able to generate tax revenue to pay for amenities and services because they accommodate more homes and businesses on less land. A single parcel of land with a multi-story building containing apartments or condos and ground-floor retail, for example, generates multiple times more tax value than the same-sized parcel with a single-story structure surrounded by a parking lot. At the same time, this concentration of services, amenities, and housing gives people a greater opportunity to live their lives with less reliance on a car. When workplaces, shops, schools, and parks are located close to where people live, walking, cycling, and public transit become convenient and practical choices for daily trips.
In this post, I’d like to make a comparison of two very different city streets that highlight the significant difference in tax revenue based on good and inefficient urban design.
Measuring Efficiency
A helpful way to think about this is through the concept of land use efficiency, which is similar to the fuel efficiency of a vehicle. Just as a car can have good or bad gas mileage, land can be used more or less efficiently. While fuel efficiency is measured in litres per 100 kilometres (or perhaps miles per gallon), land use efficiency can be measured in dollars of tax revenue generated per hectare. With this measure, a bigger number means more efficient land use, a very practical consideration when it comes to what our city can afford at budget time.
As we established, fuel efficiency measures how far a vehicle will be able to take you for a given amount of gas. Land use efficiency, then, measures how much a given property will generate in tax revenue to pay for city services, amenities, and infrastructure based on the size of the given parcel of land.
This metric reveals how productively our land is being used to fund the essential city services we all depend on, and it will be the measure we use here.
The contrast between Kent Street and St. Joseph Boulevard is a lesson in the power of land use.
The slide above and the tax data analysis featured in this post are from Pat Bickerton (@pbickerton.bsky.social on Bluesky), who does great data work with Strong Towns Ottawa.
Urban Density: Kent/Bank Street
To start, let’s look at a 3-block wide section of Centretown around Kent/Bank Street (between Lyon and O’Connor). This is an area of mixed commercial and residential use, and it yields $16.8 million in annual municipal taxes from about 40 hectares according to the city’s tax data. The chosen section of Centretown features some apartments and condos but specifically doesn’t include the core downtown blocks with the most tax efficient high-rise office towers. This makes for a great comparison because it’s a sort of middle ground between the densest parts of the city and the sparse suburban landscape.
2024 Municipal Taxes: $16.8 M
Area: 39.5 ha
Revenue Density: $ 426k / ha
Kent and Bank Streets, with a mix of residential apartments and condos, ground-level retail, and more pedestrian- and bike-friendly infrastructure, creates a highly efficient and valuable urban landscape. Every block is maximized to house lots of people, generate economic activity and, consequently, provide a ton of value for the city. In addition, the people who live there who can probably get away with far fewer (or no) car trips in a given week.
Suburban “Density”: St Joseph Boulevard
By contrast, a key commercial corridor in Orleans, St. Joseph Boulevard, provides only $16.5 million in tax revenue from a much (8 x) larger area of 225 hectares. St Joseph is literally the heart of Orleans’ business district, and it represents a more traditional suburban model for a shopping area. Characterized by single- or two-story commercial plazas, vast surface parking lots, and a car-centric layout, its land use is dramatically less intensive.
2024 Municipal Taxes: $16.5 M
Area: 225 ha
Revenue Density: $73k / ha
This sprawling design generates significantly less tax revenue per hectare, effectively nobody lives on the street proper, and the street is just simply not a nice place to be outside a car. This increased distance to get from where people live to where they need to go means people living in Orleans are far more dependent on cars for more of their weekly trips, which means cost of living is almost necessarily higher, even if you factor in high housing costs for suburban homes.
The Math
| Street Area | Kent/Bank Street | St Joseph |
|---|---|---|
| 2024 Municipal Taxes | $16.8 M | $16.5 M |
| Developed Land Area | 39.5 ha | 225 ha |
| Revenue Density (taxes / developed area) | $ 426 k / ha | $73 k / ha |
This results in a revenue density of $426,000 per hectare for Kent and Bank Streets versus $73,000 for St. Joseph. All of this means St Joseph offers 1.8% less tax revenue over a 5.7 x larger area, meaning land developed like Centretown is 5.8 x more valuable to the city.
This gap suggests a considerable opportunity for Ottawa’s eastern communities. Adopting principles of densification and modern urban planning could allow Orleans to increase its tax revenue and encourage local economic growth.
Comparing These Directly
If we overlay the size and shape of our Centretown area over St Joseph (rotated, of course) at the same scale, you can see the tremendous size of the St. Joseph Business District (Heart of Orleans) in comparison.
Keep in mind that the smaller Kent/Bank Street footprint (which doesn’t include the portion of the street with high-rise office towers that make up the part of this area further north into downtown) brings in slightly more tax revenue for the city than does ALL of the St Joseph region in significantly less space. For its size, Centretown outperforms St Joseph by a factor of 5.8x. Think of what the city could do with tax revenue coming from that portion of Orleans if the whole area were a similar density and distribution as Centretown.
Applying Centretown’s revenue density value to St Joseph and surroundings would bring in $96 million in annual municipal tax revenue, an increase over today of $79 million, which would enable things like better city services and amenities, more frequent bus service, all kinds of needed investments to make the area shine. This is just one stretch of one suburban corridor that can bring in that much additional tax revenue, imagine if other parts of the suburbs made even small but meaningful steps towards additional density and mixed-use neighbourhoods.
What Can We Do?
The good news is that the vision for a more prosperous and dynamic St. Joseph Boulevard is not a distant dream. The City of Ottawa has laid the groundwork for change multiple times already, first through the St. Joseph Boulevard Corridor Study early in the 2000s, and now through the Orléans Corridor Secondary Plan. These plans explicitly call for the transformation of the boulevard from a suburban commercial strip into a more intensely developed, mixed-use urban district. The goal is to create a “15-minute neighbourhood” where new and existing residents can access daily needs within a short walk, supported by improved transit and a more inviting public realm.
The Heart of Orléans Business Improvement Area (BIA) is a key partner in this revitalization effort, advocating for the interests of local businesses and promoting the area as a destination for arts, culture, and unique shopping and dining experiences. The BIA’s involvement is crucial in ensuring that redevelopment meets the needs of the existing community while attracting new investment.
It’s not to say this transformation will be easy, but the end result will be a layout that works for more people and the increased tax revenue in turn funds other improvements the city needs and is planning for.
The city’s urban design guidelines that apply here provide a clear roadmap for how this transformation can be achieved. These guidelines emphasize:
- Mixed-Use Development: Integrating residential units above ground-floor retail and commercial spaces.
- Increased Density: Encouraging the development of mid-rise and high-rise buildings, particularly around future transit stations.
- Pedestrian-Friendly Design: Wider sidewalks, street trees, and reduced setbacks to create a more inviting and walkable environment.
- Reduced Parking Requirements: Shifting away from large surface parking lots in favor of on-street parking and structured parking to free up land for more productive uses.
The financial upside of this shift is undeniable. If St. Joseph Boulevard could even begin to approach the revenue density of Kent Street, the resulting increase in municipal taxes would be transformative for Orleans and the city as a whole. This new revenue could be reinvested into the community to further enhance infrastructure, improve public services, and fund new amenities.
Modernizing the layout of our suburban districts is not just about increasing tax revenue; it’s about building more sustainable, resilient, and enjoyable communities. By strategically intensifying development along key corridors like St. Joseph Boulevard, we can create a more prosperous future for Orleans, one that is less reliant on cars, more supportive of local businesses, and ultimately, a more vibrant place to live, work, and play. The blueprint for a more valuable boulevard is already in our hands; it’s time to build it.
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