Loading...
HomeMy WebLinkAboutWD-3-85 4 CORPORATION OF THE TOWN OF NEWCASTLE PUBLIC WORKS DEPARTMENT R. DUPUIS, P. ENG., DIRECTOR HAMPTON,ONTARIO TEL.(416)263.2231 LOB 1J0 987-5039 REPORT TO THE GENERAL PURPOSE AND ADMINISTRATION COMMITTEE MEETING OF JANUARY 21 , 1985. REPORT NO. : WD-3-85 SUBJECT: ADMINISTRATION OF DEVELOPMENT AGREEMENTS RECOMMENDATION: It is respectfully recommended: 1. That this report be received; and, 2. That Council reaffirm its concurrence with the Town' s Standard Subdivision Agreement as the instrument setting out the agreed upon conditions between the Town and Developers of land within the Town; and, 3. That staff be directed to take whatever actions are necessary to ensure that the conditions set out in said subdivision agreements are complied with so as to protect the interests of the Town; and, . . . .2 nt,� Page 2 REPORT NO. WD-3-85 4. That staff meet with major land developers in the Town and their consultants and/or agents to discuss problems currently being experienced with the administration of Development Agreements; and, 5. That the Town' s Standard Subdivision Agreement be modified to authorize the Treasurer to cash any letter of credit which has not been renewed at least ten (10) working days prior to the expiry date thereof; and, 6. That the Treasurer be authorized to cash any currently held letters of credit which have not been renewed at least ten (10) working days prior to the date of expiry thereof and, that the involved parties be so advised. REPORT: With the acceleration of development in the Town, problems relating to administration of the Standard Subdivision Agreement are manifesting themselves, and becoming a greater concern. In short, it would appear that some developers are either signing the subdivision agreement without full knowledge of their obligations under the agreement, or for the sake of time, are ignoring their agreed upon obligations. In any event, this approach leads to untold problems for staff with no financial and, in some cases, legal protection for the Town. . . . .3 Page 3 REPORT NO. WD-3-85 The major problem seems to be occuring where a developer is required to secure certain approvals and pay certain securities prior to proceeding with a particular phase of development. For example, Section 5.10 of the agreement, sets out certain conditions for authorization to commence works. In most cases, the developer is so anxious to proceed that the requirements are, for the most part, ignored. This leads to the developer constructing works with no blessing by the Town and, ultimately, some question as to the quantity and quality of construction. Since the Town, upon completion of the development, is expected to assume the constructed works, the above procedure is very unsatisfactory. To date it has been difficult to enforce the agreement too rigidly as the developers feel that they are providing a major benefit to the Town and should not be constrained by red tape. Any actions taken by staff are considered anti-development and reflect poorly on the Town. However, if the Town is to maintain protection under the terms of a legally binding agreement, there is an obligation to take all necessary actions to ensure compliance. As these latter points potentially involve Council , staff are seeking Council concurrence with respect to the format of the existing agreement. Additionally, as some of the developers and their agents may not fully appreciate the collective implications of all development in the Town, it would be desirable to arrange a meeting to discuss how we would like to proceed, armed with Council support and direction. . . . .4 Page 4 REPORT NO. WD-3-85 Further to the above, there are other problems relating to lead time required for processing of matters by staff; inspections, engineering details, etc. , which should all be discussed. Thus the previously mentioned meeting is even more important. The latter two recommendations relate to renewal and/or cashing of letters of credit to maintain the Town's security. Firstly, the letters of credit are secured as a guarantee that the developer is sincere in his intention to develop in an orderly fashion. They also provide for completion of the works in the event that the developer encounters financial difficulties. Under the present agreement, a letter of credit is issued by the Developer' s lending institution usually for one year' s term. However, the works may not be completed in a year and the financial guarantee provided by the letter of credit must be renewed. Unfortunately, the administrative procedures associated with renewal often result in a situation where the old letter of credit would expire prior to issuance of a new one. To cover this situation and maintain a secure position for the Town, it is recommended that the agreement be modified so that all parties understand that the Treasurer will have the right to cash letters of credit which have not been renewed at least ten (10) working days prior to the expiry date of the original letter . . . . .5 Page 5 REPORT NO. WD-3-85 As indicated previously, problems with the administration of subdivision agreements are becoming evident, with increasing development activity in -the Town. However, it is felt that proper co-ordination and co-operation can improve the present situation. The recommendations of this report should go a long way towards achieving this. Respectfully submitted, R.G. Dupuis , P. Eng., Director of Public Works. T.T. Edwards, M.C. I .P., Director of Planning. RGD/TTE/ico January 15, 1985. i