The URL can be used to link to this page

Home My WebLink AboutPD-108-94UNFINISHED BUSINESS THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON Recommendations: It is respectfully recommended that the General Purpose and Administration Committee recommend to Council the following: 1. THAT Report PD- 108 -94 be received; 2. THAT Council direct staff to bring forth an amending by -law to the Development Charge By -law 92 -105, as amended, for the October 11, 1994 Council meeting in compliance with the notice requirements of the Development Charges Act to: a) maintain the current development charge quantum as indexed last in October 1992 to April 30, 1995; or b) amend the current development charge quantum by the amount equal to the corresponding index figure for the six (6) month period prior to November 1, 1994; or c) amend the current development charge quantum by the amount equal to the corresponding index figure for the twenty -four (24) month period prior to November 1, 1994. 3. THAT a copy of Staff Report PD- 108 -94 and the decision of Council be forwarded to the Durham Home Builders Association. 1. BACKGROUND 1.1 Council, at its April 19, 1994 meeting, in consideration of Staff Report PD- 69 -94, directed Staff to bring forth an amending by -law to the Development Charge By -law 92 -105 for the May 31, 1993 Council meeting that would maintain the current development charge quantum as indexed last in October 1992 to October 31, 1994. zG PA EP° RECYCLE THIS IS PREMED IX RECYCLED PAPER REPORT NO.: PD- 108 -94 PAGE 2 1.2 Subsequently, Council at its May 31, 1993 meeting approved By -law No. 93 -74, which in part specified that all development charges paid between the period of October 1, 1992 and October 31, 1994 would be frozen at the October 1992 rate. 1.3 As the development charge freeze October 1994, the purpose of this and Council the opportunity to Development Charge By -law 92 -105, with appropriate direction to requirements for the processing of Charge By -law 92 -105. will soon expire at the end of report is to provide Committee revisit the content of the as amended, and provide staff initiate the public notice an amendment to the Development 2. APPLICABLE PROVISIONS OF THE DEVELOPMENT CHARGES ACT 2.1 The Development Charges Act provides through Section (7), the necessary mechanism by which a Council that has passed a Development Charge By -law the opportunity to amend said by -law. 2.2 Similar to the procedures followed in passing a Development Charge By -law, Council is required to hold at least one (1) public meeting prior to any amending by -law being considered for approval. The public meeting is to be held no earlier than twenty (20) days after the requirements for the giving of notice has been complied with. 2.3 Staff, pending Committee and Council's direction, will take the appropriate action to see that the notification process is complied with pursuant to the Development Charge Act. 3. STAFF COMMENTS 3.1 The indexing provisions contained within By -law 92 -105, prior to Amendment No. 93 -74, as passed May 31, 1993, stipulated that the development charge quantum was to be adjusted semi - annually on the first of May and the first day of November in accordance with the Engineering News Index for the most recently available six month period. J 1295 REPORT NO.: PD- 108 -94 PAGE 3 3.2 If this provision had not been amended by By -law 93 -74, and the freezing of the development charge quantum not taken place for the two year period, the development charge quantum would have been adjusted at the semi - annual dates as follows: DATE SINGLE/ SEMI UNIT BUILDING COST INDEX October 1992 $ 3308.54 4940.00 $ 4214.00 $ 3051.00 > (0.0% increase) November 1992 3308.54 4214.00 3051.00 2034.00 > (7.1 % increase) May 1993 3545.27 as of May 1, 1993 > (0.7% decrease) November 1993 3519.36 + 144.00 (7.1 % increase) > (6.9% increase) May 1994 3762.57 May 1, 1993 charge Staff would note that the percentage changes are reflective of an increase or decrease from one adjustment date to the next and do not revert back to the start date of October 1992. 3.3 The above noted adjustments would have reflected the following changes to the development charge quantum for the corresponding adjustment dates: DATE SINGLE/ SEMI UNIT TOWNHOUSE UNIT APARTMENTS 2 BDRM. & 1 BDRM. & LARGER BACHELOR as of October 1992 4940.00 $ 4214.00 $ 3051.00 2034.00 as of November 1992 4940.00 4214.00 3051.00 2034.00 (0.0% increase) as of May 1, 1993 + 350.00 + 299.00 + 216.00 + 144.00 (7.1 % increase) May 1, 1993 charge as of November 1993 - 37.00 - 31.00 - 22.00 - 15.00 (0.7% decrease) November 1/93 charge 5253.00 4482.00 3245.00 2163.00 as of May 1, 1994 + 362.00 + 309.00 + 223.00 + 149.00 (6.9% increase) May 1, 1994 charge $ 5615.00 $ 4791.00 $ 3468.00 $ 2312.00 ��I= vvalau NGicraniaye w1anye ui use ueveiuNment quantum from vctooer iyaz to may iaa4 was 7s.o-/0) REPORT NO.: PD- 108 -94 PAGE 4 3.4 During the same corresponding period at which the development quantum would have been indexed, the following number of building permits for dwelling unit starts were issued. The last column reflects the potential revenue that would have been received by the Municipality if the indexing had taken place as noted above. 3.5 It is staff's understanding, that by not realizing these monies over this time period, the scenario could arise where funds that would have been taken from the Development Charge accounts to assist the financing of capital growth projects may not be possible as a result of a shortfall of funds. This could result in the delaying, reduction in scope or deletion of the capital growth projects in the future unless the funds necessary to fulfil the projects are realized elsewhere. 3.6 As the expiry date of the freeze soon approaches, Council must make a decision so that the by -law can be amended to ensure there is a by -law to provide continuous coverage. The recommendations contained in this Report propose three (3) possible options as follows: a) OPTION ONE - freeze the current Development Charge Quantum for a period of six months, to coincide with the next scheduled index adjustment as contemplate in the original Development Charge By -law 92 -105, on the first of May 1995. This would in turn provide the opportunity for the incoming Council to evaluate the implications of an amendment to By -law 92 -105, as amended. SF /SD TH APTS POTENTIAL REVENUE Nov. 1/92 - April 30/93 141 - - $ NIL May 1/93 - October 31/93 260 28 - 99,372.00 Nov.1 /93 - April 30/94 347 92 1 133,396.00 May 1/94 -August 22/94 270 60 - 116,280.00 TOTAL: $ 349,048.00 3.5 It is staff's understanding, that by not realizing these monies over this time period, the scenario could arise where funds that would have been taken from the Development Charge accounts to assist the financing of capital growth projects may not be possible as a result of a shortfall of funds. This could result in the delaying, reduction in scope or deletion of the capital growth projects in the future unless the funds necessary to fulfil the projects are realized elsewhere. 3.6 As the expiry date of the freeze soon approaches, Council must make a decision so that the by -law can be amended to ensure there is a by -law to provide continuous coverage. The recommendations contained in this Report propose three (3) possible options as follows: a) OPTION ONE - freeze the current Development Charge Quantum for a period of six months, to coincide with the next scheduled index adjustment as contemplate in the original Development Charge By -law 92 -105, on the first of May 1995. This would in turn provide the opportunity for the incoming Council to evaluate the implications of an amendment to By -law 92 -105, as amended. REPORT PD-108-94 b) OPTION TWO - amend the Development Charge by -law Quantum to reflect the Building Cost Index for the six (6) month period prior to November 1, 1994. The indices for the months of September and October are not presently available. As a guideline, the indexed amount for the last six (6) months, March 1994 to August 1994, has resulted in an increase of point nine -sixth (0.96 %) of a percent. This would result in an increase in the development charge quantum, for example, of a single family /semi detached unit up from $ 4,940.00 to $ 4,987.00 per unit. This, of course, assuming there will be no major upswing in the indices for the months of October and November. C) OPTION THREE - amend the Development Charge By -law Quantum to reflect the Building Cost Index for the twenty -four (24) month period prior to November 1, 1994. Again, as a guideline, the indexed amount for the twenty -two (22) month period from November 1992 to August 1994, has resulted in an increase of fourteen point eight (14.8 %) percent. This would result in an increase in the development charge quantum, for example, of a single family /semi detached unit up from $ 4,940.00 to $ 5,671.00 per unit. 4. CONCLUSION 4.1 Pending Committee and Council's direction to select one of the 3 options, Staff will take the appropriate action to bring forth an amending by -law, and to comply with the notification process pursuant to the Development Charges Act. Respectfully submitted, - Franklin Wu, M.C.I.P. Director of Planning and Development LT *FW *df 26 August 1994 Reviewed by, t� W.H. Stockwell Chief Administrative Officer