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HomeMy WebLinkAboutFND-007-09I,Y~ergiziug Ontar(o REPORT FINANCE DEPARTMENT Meeting: GENERAL PURPOSE AND ADMINISTRATION COMMITTEE Date: Report #: Subject: MONDAY MARCH 30T", 2009 FND-007-09 File DEVELOPMENT CHARGES AMENDMENT AND BY-LAW Resolution #: Y ~' ~ ~) -~~ By-law #: Recommendations: It is respectfully recommended that the General Purpose and Administration Committee recommend to Council the following: 1. THAT Report FND-007-09 be received and approved; 2. THAT the phase-in component of the residential development charges on Schedule "1" of the By-law No. 2005-108 be deferred from January 1, 2009 to July 1, 2009; 3. THAT the phase-in component of the non-residential (excluding Industrial) development charges on Schedule "2" of the By-law No. 2005-108 be deferred from January 1, 2009 to July 1, 2009; 4. THAT there is no need to alter or amend the Development Charges Amendment Study, May 2008, prepared by Hemson Consulting Ltd.; 5. THAT the attached By-law to amend the Development Charges By-law 2005-108 as amended (Attachment #A), with any amendments recommended by the General Purpose and Administrative Committee be recommended to Council for approval and enactment; and 6. THAT the Region of Durham and recorded interested parties be provided a copy of this report and be notified of Council's decision. Submitted by: ~ ~ v Reviewed by: V "~"""` -_ . _ _ _ Na cy Ta or, B. ., .A., Franklin Wu, Director f Finance/Treasurer Chief Administrative Officer. NT/LG/hjl REPORT NO.: FND-007.09 BACKGROUND: PAGE 2 1.0 At the Council meeting of December 8, 2008, the following Notice of Motion was approved by Council Resolution #C-583-08. WHEREAS the Municipality of Clai-ington's Development Charges By-Law No. 2005-108, as amended by By-Law No. 2008-104 and By-Law 2007-195 and By- Law 2006-160, provides for annual indexing to next take place on January 1, 2009; WHEREAS By-Law 2005-108 as amended, provides for a phasing schedule whereby the final component of the phase-in schedule approved June 9, 2008 is effective on January 1, 2009; and WHEREAS Council is concerned over the combined impact of both the indexing and the. phase-in resulting in a 25 % increase in development charges quantum during a time of economic uncertainty; NOW THEREFORE BE IT RESOLVED that staff be directed to: prepare a draft amendment to By-Law 2008-108 to defer the final component of the phase-in increase from January 1, 2009 to July 1, 2009, and to hold the necessary public meeting so that Council can consider the amendment as early as possible in 2009; and 2. not increase the existing charge on January 1, 2009 for the phase-in increase, but rather pending consideration by Council of the amendment to the By-Law, just increase it on that date by the indexing component of By-Law 2008-108 as is standard practice in all municipalities. 2.0 DEVELOPMENT CHARGES BY-LAW AMENDMENT PROCESS: 2.1 The Development Charges Act, 1997, allows a municipality to amend an existing development charges by-law. Section 19 of the Acf sets out the requirements related to this procedure: 19. (1) Sections 10 to 18 apply, with necessary modifications, to an amendment to a development charges by-law other than an amendment by, or pursuant to an order of, the Ontario Municipal Board. [emphasis added} 19. (2) In an appeal of an amendment to a development charges by-law, the Ontario Municipal Board may exercise its powers only in relation to the amendment. REPORT NO.: FND-007-09 PAGE 3 2.2 To amend a development charges by-law a municipality must go through the same public process associated with enacting a development charges by-law. It needs to complete a background study outlining the purpose of the amendment and the rationale for the amendment. This document serves as the background study required under section 10 of the Act. 2.3 A municipality must hold a public meeting on the amendment, having provided three weeks notice of the meeting, and has to make the background study and proposed by-law amendment available two weeks prior to the meeting. The public meeting is March 30, 2009 and was advertised commencing the week of March 9~', 2009. The applicable documents were available at the Clerk's Department commencing on March 11`", 2009. 2.4 Section 19(2) of the DCA is important because it allows for an amendment to an existing by-law to be passed without exposing the unaltered portions of the by- law to appeal. Only the amendment to the development charges by-law is subject to appeal and consideration by the OMB. 3.0 BACKGROUND STUDY REQUIREMENTS: 3.1 Section 10(1) of the DCA, 1997, sets out the requirement for a municipality to complete a development charge background study prior to the passage of a development charge by-law or amendment. Subsection 10(2) identifies what is to be included in the development charge background study. These legislative requirements are summarized as follows: s.10(2)(a) -estimate the amount, type and location of development to which the development charge [amendment] is to apply; s.10(2)(b) -establish the eligible growth-related costs and services (as determine under paragraphs 2 to 8 of subsection 5(1) of the DCA, 1997) to which the development charge by-law [amendment] would relate; s.10(2)(c) -examine, for each service to which the development charge by-law [amendment] relates, the long term capital and operating costs for the capital infrastructure required. 3.2 The amendment proposed is not altering the amount, type and location of development orgrowth-related capital costs that form the basis of the charge determined in the Development Charges Amendment Study, so s.10(2)(a),(b) and (c) are not relevant. The proposed amendment therefore does not require an amendment to the 2008 Development Charges Amendment Study and this document serves as the background study required under Section 10 of the Act. REPORT NO.: FND-007-09 4.0 PROPOSED AMENDMENT: PAGE 4 4.1 The proposed amendment to defer the phase-in component increase from January 1, 2009 to July 1, 2009 was done to lessen the financial burden on residential and non-residential (excluding Industrial) construction or additions in the first six months of 2009. 4.2 The Municipality is permitted through its Development Charges By-law to index its municipal development charges on an annual basis effective January 1ST each year in accordance with the Statistics Canada Quarterly, Construction Price Statistics, catalogue number 62-007 based on the 12 month period most recently available. 4.3 The indexing percent based on the third quarter of 2008 per Statistics Canada Quarterly, Construction Statistics catalogue number 62-007 was 11.6% which was to be calculated on January 1, 2009 development charges. 4.4 Also effective on January 1, 2009 was the phase-in component on the residential and non-residential (excluding Industrial) development charges so the combined impact would be approximately a 25% increase on both types of development charges. 4.5 Council was concerned with the high percentage increased during this time of economic uncertainties so the January 1, 2009 phase in component on the residential and non-residential (excluding Industrial) development charges has been delayed to July 1, 2009. 4.6 In order to implement this proposed amendment to defer the phase-in increase from January 1, 2009 to July 1, 2009, Schedule "1"-Residential Development Charges and Schedule "2" -Non-Residential Development Charges of By-law No. 2005-108 must be amended. 5.0 CONCLUSION: 5.1 Per DCA, 1997, the Development Charges By-law expires every 5 years which necessitates that the Municipal By-law No. 2005-108 expires on June 30, 2010. 5.2 As staff will commence a full Development Charges Update Review this fall, it is recommended that an amendment to the 2008 Development Charges Amendment Study is not required and that this report fulfills the requirement for a background study. REPORT NO.: FND-007-09 Attachment: Attachment "A" - By-law to amend By-law 2005-108 Interested Parties: Region of Durham PAGE 5 CORPORATION OF THE MUNICIPALITY OF CLARINGTON 40 TEMPERANCE STREET, BOWMANVILLE, ONTARIO L1C 3A6 T (905)623-3379 F (905)623-4169 Attachment "A" THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON BY-LAW N0.2009-XXX Being a by-law to amend Municipality of Clarington Development Chazge By-law No. 2005-108, as amended by By-law No. 2008-1D4, 2007-195 and By-law 2006-160. WHEREAS Subsection 2(1) of the Development Charges Act, S.O. 1997, a27 (the "Act") provides that the council of a municipality may by by-law impose development charges against land to pay for increased capital costs required because of increased needs for services arising from the development of the area to which [he by-law applies; AND WHEREAS the Council of The Corporation of [he Municipality of Clarington enacted By-]aw No. 2005-108 - Being a By-law to impose development charges against land in The Municipality of Clarington pursuant to the Development Charges Act, 1997 for The Corporation of the Municipality of Clarington. By-law No 2005-108 was amended by By-law No. 2006-160, by By-law No. 2007-195 and by By-law 2008-104; AND WHEREAS Council has before it the Background Study enfitled "Development Charges Amendment Study, Municipality of Clarington" dated May, 2008 and report FND-007- 09 (the "Study"); AND WHEREAS Section 19 of [he Act provides for the process for an amendment to a development Chazge by-law, including the requirement [hat a public meeting ("Public Meeting") be held before an amendment is passed; AND WHEREAS Council gave notice [o the public of the Public Meeting and held the Public Meeting pursuant to sections 12 and 19 of the Act on Mazch 30, 2009, prior to which the Study and [he proposed amending by-law were made available to the public, and Council heard comments and representation from all persons who applied to be heard and considered Report FND-007-09 dated March 3Q, 2009 (the "Staff Report"); AND WHEREAS staff of the Municipality considered [he public comments and representations made at the Public Meeting and at the meeting of Council held on Mazch 3Q, 2009 submitted to Council Addendum Report to Report FND-007-09 dated March 30, 2009; AND WHEREAS at its meeting on Mazch 3Q 2009, by Resolution No. C-XXX-09 Council approved the recommendations contained in Report FND-007-09 and the Addendum thereto; NOW THEREFORE THE COUNCIL OF THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON ENACTS AS FOLLOWS: I. THAT By-law No.2005-108, as amended, is further amended by deleting Schedule "]" and " 2" attached thereto and replacing it with a new Schedule "1" and " 2" in the form and with the content of Schedule "1" and " 2" attached to and forming part of this by-law. 2. This by-law comes into force and is effective on July 1, 2009. By-law read a firs[ and second time this 6"' day of April 2009. By-Law read a third time and finally passed this 6'" day of April 2009. Jim Abernethy, Mayor Patti L. Barrie, Municipal Clerk ~^ 4 SCHEDULE "1" ~~_ RESIDENTIAL DEVELOPMENT CHARGES SCHEDULE "1" TO BY-LAW NO. 2D05-108, AS AMENDED AND AS FURTHER AMENDED BY BY-LAW 2009-XXX RESIDENTIAL DEVELOPMENT CHARGES PER UNIT SCHEDULE BY EFFECTIVE DATE July 1, 2008 January 1, 2009 July 1, 2009 (11.6% Index Only) (Index & Phase-In) Single and Semi-Detached $13,012 $14,521 $16,224 Townhouse, Multiple and Row Units $11,353 $12,670 $14,131 w Apartments Large $8,907 $9,940 $11,148 {' i /.' Small $5,651 $6,307 $7,065 SCHEDULE"2" NON-RESIDENTIAL DEVELOPMENT CHARGES SCHEDULE "2" TO BY-LAW NO. 2005-108, AS AMENDED AND AS FURTHER AMENDED BY BY-LAW 2009-XXX NON-RESIDENTIAL DEVELOPMENT CHARGES PER SQUARE METRE OF GROSS FLOOR AREA SCHEDULE BY EFFECTIVE DATE July 1, 2008 January 1, 2009 July 1, 2009 July 1, 2010 (11.6% Index Only) (Index & Phase-In) (Phase-In Only)' Non-Residential (excluding Industrial) $48.35 $53.96 $61.56 $69.16 Industrial $26.89 $30.00 $34.55 $39.09 " Does not include January 1, 2010 indexing as information not yet available.