The decline in the illegal whisky and buffalo trade lessened the need for a fortified outpost in the area, resulting in the fort's detachment to decline to four constables by 1880. However, the situation would reverse in the early 1880s, with several plans drafted to develop the area surrounding Fort Calgary. In August 1882, the outpost was designated as a "district post," and its detachment reinforced in order provide a permanent police presence, and to enforce legal ordinances for the Canadian Pacific Railway reserve adjacent to the fort. James Walker, a former NWMP member and owner of the Bow River Saw and Planing Mill was contracted to expand the outpost. The contract called for the construction of a barracks, a guardroom with 12 holding cells, a hospital, officers' quarters, a sergeants' mess, and facilities for tradesmen. In order to accommodate the outpost's expansion, the fort's palisades were taken down, and several of the outpost's older buildings were razed. The expansion cost the government approximately C$35,000.