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Home My WebLink AboutPD-41-93 e y' °~pp,,~~~~ gg~~ gg--qg ~y~q@@ryry pry-o p~ g~ ~,,g ~°gy~~y~g p~ p~g/~p~ ^q^p~p~ 9 fA 4~®B°Y~i,9 f"Y 911 i~l~ VF ~61~ 4 t~/KY 4`~ 6,dF ~~§Y ~s i-B 9..B.mG DN: DEVELOPMENT.GPA s Meeting: General Purpose and Administration Committee Feie ~~~,~~~,`~7`~>~~ ~eS. L%'t' i~8'C:~~~_ 1~:~ Date: Monday, March 1, 1993 Dy-Lam # , ~epOrt Pn-41 -93_ Fiie P . 1 ,object: DEVELOPMENT CHARGES POLICY REPORT AMENDMENT TO SECTION 2.10 - COLLECTION TIMING PLANS OF SUBDIVISION/CONDOMINIUM ~ot~tr~~r~atior~~; It is respectfully recommended that the General Purpose and Administration Committee recommend to Council the following: 1. THAT Report PD-41-93 be received; 2. THAT the Development Charges Policy Report, as approved by Council on March 2, 1992, be amended by replacing the first paragraph within Section 2.10.2 with the following new paragraph: "That for a plan of subdivision or condominium, 25% of the total amount of the development charge imposed in respect of the aggregate number of dwellings that are permitted to be developed on land which the plan applies shall be payable on the execution of an agreement under Section 50 of the Planning Act, 1983 between the - - developer-and-the Town; 25% of--the...dotal-amount_sha11 be payable prior to the issuance of a building permit for the first dwelling unit; 25% of the total amount shall be payable on the earlier to occur of the first anniversary of the issuance of the first building permit and the issuance of a building permit for the first dwelling unit in addition to building permits previously issued for 50% of the dwelling units; and the last 25% of the total amount shall be payable on the earlier to occur of the second anniversary of the issuance of the first building permit and the issuance of a building permit for the first dwelling unit in addition to building permits previously issued for 75% of the dwelling units. All payments shall be adjusted to include indexing at the time of payment."; 3. THAT the Development Charge By-law be amended to change the indexing from Construction Cost Index to Building Cost Index and the amending by-law be brought forth for passage in accordance to the procedure and requirement set out in the Development Charges Act; and ...2 ~~N~a ° ~ ~ ~E~Y~« TN IS IS f~R1ME~ ii,EGYCIED PhPFH REPORT NO.: PD-41-93 PAGE 2 4. THAT a copy of Report PD-41-93 and the decision of Council be forwarded to the Urban Development Institute, the Toronto Home Builders' Association and the Durham Home Builders' Association. 1. BACRGROUND 1.1 Following the passage of the Development Charges Policy Report and By-law, staff was approached by a number of developers who expressed an interest in proceeding with their individual projects. To that end, meetings and various discussions have taken place with Town staff resulting in the initial preparation necessary to finalize an agreement. 1.2 Inherent to the completion of any of the agreements has been a common theme presented by the development industry that the "economic climate of the day" and the "financial responsibilities" necessary to initiate any development was indeed firstmost on their operational timetables. It was with this in mind, that the development industry requested due consideration of returning to the collection timing schedule as implemented prior to the Development Charges Policy Report. In addition, a suggestion was made that the -Town should perhaps freeze the indexing- of -- development charge. 1.3 In addition to the concern raised by the development industry, the Town's consultant - C. N. Watson Associates Ltd., recently indicated that the Town may wish to re-evaluate which of the two indexing criteria (i.e.: Construction Cost Index (CCI) and Building Cost Index (BCI)) from the Engineering News Record would best suit the Town's scenario. Currently the indexing contained within the Town's Development Charge By-law is specifically tied to the Construction Cost Index (CCI). ...3 -- ~ J REPORT NO.: PD-41-93 PAGE 3 2. STAFF COMMENTS: 2.1 Section 2.10 entitled "Collection Timing" within the Development Charges Policy Report, addresses the issue that the Municipality deals with various types of development applications including plans of subdivision/condominium, rezoning, site plan and consent applications. Final approval of any of these applications does not necessarily mean that building permits will be applied for immediately. A consistent policy was required to ensure that development charges were paid prior to or at times of issuance of building permits. Due to the varying nature of the legislative requirements for the various types of development approval, the timing of collection would have to be varied. 2.2 With- respect to the collection for Plans of Subdivision/ Condominium, the Development Charges Policy Report implemented a payment schedule that could be best summarized as follows: ....TIMING AMOUNT. DUE... 1. Execution of Agreement - 50% of total amount due for all units 2. 1st Anniversary of - 25% of total amount due for Execution of Agreement all units or 1st building permit to be issued for 1st unit in excess of 50% of total units within Plan of Subdivision 3. 2nd Anniversary of - Last 25% of total amount Execution of Agreement due for all units or ist building permit to be issued for 1st unit in excess of 75% of total units within Plan of Subdivision 4 f ! ~,-.~ I REPORT NO.: PD-41-93 PAGE 4 2.3 Prior to the approval of the Development Charges Policy Report in March 1992, the collection schedule of "lot development charges" through subdivision agreements was as follows: TIMING AMOUNT DUE ~1. Execution of Agreement - 25% of amount due for all units 2. Prior to issuance of 1st - 25% of amount due for all Building Permit units 3. 1st anniversary of issuance - 25% of amount due for all of 1st building permit units or 1st building permit to be issued for the 1st unit in excess of 50% of total units within plan of subdivision 4. 2nd anniversary of issuance - .last 25% of amount due for of 1st building permit all units or 1st building permit to be issued for the 1st unit in ...excess of 75% of total units within plan of subdivision 2.4 Staff in reviewing the request of the development industry, would note that the implementation of the former payment schedule would not offend the intent of the Development Charge Policy Report, would provide the development industry with a degree of flexibility, yet .provide the Town the necessary assurance that sufficient funds would be received prior to the issuance of the first building permit. 2.5 C. N. Watson and Associates Ltd. in one of their "informational newsletters" noted that a few of their clients had recently ...5 X27 REPORT NO.: PD-41-93 PAGE 5 contacted them to enquire as to which indexing option - The Construction Cost Index (CCI) or The Building Cost Index (BCI) would be considered to be the most appropriate for use in indexing a development charge. In reviewing the basis for the two indexes, C. N. Watson and Associates concluded that the BCI may be more suitable for Development Charge indexing purposes. It was considered generally more consistent with requirements for the construction of the type of municipal projects included in the development charge calculation. Based on the consultant's suggestion, Staff feel that an amendment to the Development Charge By-law should be made to change the indexing to B.C.I. In this regard, Staff recommend Council to endorse the change and an amendment will be brought forward in compliance with the requirement for public meeting stipulated in the Development Charges Act. It should be noted that the B.C.I. is lower than the C.C.I.. For example, between February 1992 and February 1993, the C. C. I. increased by 6.0 % whereas the B.C.I. increased by 2.0 2._6 It should_be noted... that the next indexing is April 1993.__ In__this_ regard, Staff will expedite the by-law amendment. In the event the amending by-law is not ready by the end of April 1993, Staff will not impose indexing until the amendment by-law is passed. The effective date of the change in the index will be addressed in the report on the proposed by-law. 2.7 With respect to any suggested freeze of indexing, Staff is not in favour of such a request because the estimated costs of providing capital works by the Town are based on regular indexing.- Any freeze of indexing, temporary or otherwise, would impact on the Town's ability to finance the capital works and either the taxpayers be burdened to cover the shortfall or capital works would have to be delayed. ...6 REPORT NO.: PD-41-93 PAGE 6 3. Lengthening the development charge payment schedule and converting to Building Cost Index should prove beneficial to the development and building industry. In so doing the Town is acting in a responsible and flexible manner recognizing the current tough economic climate. Respectfully submitted, Recommended for presentation to the Committee - ~ „r ? ~ ' (1 Franklin Wu, M.C.I.P. Lawrence E. Kots~f~ Director of Planning Chief Administrj'ti~e and Development Officer LDT*FW*jip 24 February 1993