HomeMy WebLinkAboutADMIN-25-99 Addendum THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
REPORT
Meeting: Special Council
Date: July 29, 1999
Report#: Addendum to ADMIN 25-99
Subject: Development Charges— Revised Quantum
Recommendations:
1. That Report Admin 25-99 be lifted from the table, and
2. That Report Admin 25-99 be approved with the exception of recommendation #
2, and
3. That Council consider amending recommendation #2: ADMIN 25-99 as follows :
That the Capital Works forecast as contained in the Development
Charges Background Study— Final Report, July, 1999 be approved with
an adjustment to the capital forecast to defer the two projects
scheduled for the year 2007 and 2008 in the "Indoor Recreation"
category beyond the 10 year timeframe;
Adjust the quantum accordingly per attachment#4 to $5,458 for
single/semi dwellings, $4,725 Townhouse, and $3,258 for
Apartments; and
Adjust Schedule#2 to the by-law accordingly, and
4. That any other recommendations in Admin 25-99 affecting recommendation # 2,
be adjusted to reflect the amendment to recommendation #2 above, be approved
as appropriate.
Background:
1.0 Direction:
1.1 Council, on July 19, 1999 by resolution #C-478-99, directed:
THAT Report ADMIN 25-99 be referred back to staff to review the
projected numbers and the time projections in an attempt to bring forward
a reduced Development Charge.
1.2 Staff recognize the difficulty Council is faced with in attempting to identify a
quantum at a level which responds to the requests of the Development Industry
representing the homebuyers, that will at the same time, provide the Municipality
with the services required and demanded by this same growth.
Addendum to ADMIN-25-99 Page 2
2.0 ADMIN 25-99
2.1 Report ADMIN 25-99 requested that staff be given time over the next several
months to review all the aspects of the development charge, including the
forecast and the projects included in the planning period. This timing would have
provided a comprehensive analysis on which to base a decision to adjust the
quantum. However, in response to Council direction, Staff has reviewed the
options with Hemson Consulting in order to provide Council with a reasonable
option to adjust the quantum immediately and still allow staff the time to continue
with the comprehensive analysis.
3.0 Quantum & Forecast
3.1 The quantum calculation is complex and related to a number of different factors.
The projects have been included in the capital plan based on the forecasted
population growth of 11,000 units for the ten year period. This estimate is in line
with the official plan forecast, but because it is based on a 20 year horizon, the
10-year portion may be skewed. It should also be noted that the forecast
complies with the request by the U.D.I., via their letter of April 30 1999, to
maintain the official plan projections. However, the projections do not reflect
actual growth patterns over the past several years, and as such they are to be
examined in the comprehensive analysis. The Consultant has suggested that the
adjustment to the forecast is a major undertaking and has significant impact on
most of the study, and therefore a change is not recommended until the
comprehensive analysis is performed.
3.2 The cost attributed to the projects required to service the forecasted growth is
required by the ACT, to be reduced to reflect the 10-year average within the
service category. This limits the amount of available funding from the
Development Charges to the average value. Essentially the difference between
the average standard and the actual cost is considered excess capacity or
oversizing, and is collectable through development charges beyond the 10-year
horizon.
3.3 The value assigned to excess capacity and oversizing is subtracted from the cost
of the project and as such the project cost is not included in the development
charge quantum. The Courtice Twin Pad project identified, scheduled for 2008,
is calculated as excess capacity or"pre-built" (refer to page 103 of the
Background Study). Removal of this project alone from the calculation has a
marginal effect on the quantum because it has been eliminated through the
excess capacity calculation. If the second project, the new Bowmanville
Recreation Complex in 2007 is removed alone, it also has minimal effect
because the Courtice Project then moves in to occupy the available dollars up to
the maximum allowable value. The only way to affect the quantum is to remove
both projects. This fact is confirmed on the Consultant's analysis; Attachment #1
is a summary of the impact of removal of each project separately and the
combined effect of the removal of both projects. Attachment # 2 shows the
Addendum to ADMIN-25-99 Page 3
removal of the Courtice project on its own, and attachment#3 shows the impact
of removing the Bowmanville Recreation project on its own. Attachment#4
shows the amended quantum when both projects are removed and deferred into
future years.
3.4 The Director of Community Services has reviewed the affect of an amended
forecast, using numbers that resemble the Region's growth projections, on the
timing of the Indoor Recreation projects. His comments and his estimates are
reflected in the memo of July 21, 1999 shown as Attachment# 5, and they
estimate that the timing of construction would be deferred if the forecast is
reduced. On the assumption that the comprehensive analysis will reduce the
forecast to something less than the proposed 1,100 units per year, the
anticipated conclusion is that the two major projects in the Indoor Recreation
category will be deferred to meet the slower growth pattern. At this time, rather
than distort the entire background study by reducing the forecast in isolation from
the impact to the other categories, it is suggested that Council consider the
option of deferring the two projects to future years. In accordance with the
Consultant's estimates on attachment#4, this will reduce the quantum from
$6,541 to $5,458, a reduction of$1,083 or approximately 16.6 % (Attachment#
4). If Council is in agreement with the adjustment to $5,458, the charts and by-
law will be amended to reflect the change.
4.0 Reduced Quantum Impact
4.1 The reduction to the quantum without reducing the population forecast will
provide less funding to apply to the projects that are included in the background
study. This requires that all the projects be re-examined and many that are in the
latter part of the time period will be deferred into future years. The
comprehensive study will look at all the categories and implications of ability to
finance on the lower growth projections. Staff has expressed concern that even
under the existing background study cash flow modeling, there appears to be
insufficient funds collected from development charge contributions, particularly in
roads to finance the projects in the capital plan as projected.
4.2 One of the considerations in reducing the quantum, as Council is aware, is that
by not charging the maximum allowable under the ACT, a differential is created
that makes it hard to ever catch up to the optimum charge for funding purposes.
5.0 Education Development Charges
5.1 Council raised the question of pending development charges from the local
school boards. Discussions with the Separate Board indicate that they have in
fact hired a consultant,jointly with the Public Board, to conduct a study to support
the introduction of Education Development Charges. They estimate that the
value of these charges will be somewhat less than that which was charged by
other boards through the previous legislation because of the new Provincial
funding formula. The Board will only be allowed to include the cost of land
Addendum to ADMIN-25-99 Page 4
acquisition under the new legislation, with the cost of bricks and mortar being
funded by the Province. There is a requirement that all excess capacity within
the entire Board's jurisdiction be utilized before new schools are approved, even
if the capacity is not in the specific area of growth. The Province requires that all
sources of funding such as reserves, sale of surplus property, budget surpluses,
etc be used before the application of development charges. This will result in
significantly less funding available from development charges. They anticipate
the study to be completed in the spring of 2000.
6.0 Comprehensive Analysis/Future Growth
6.1 As recommended in ADMIN 25-99, Staff will report back to Council early in 2000
with the conclusions resulting from the detailed analysis.
6.2 The Development Charges Act requires a review in a minimum of five years, and
at that time the projects will be reassessed in light of current trends and growth
estimates at that time.
Respectfully submitted,
C�
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Franklin Wu, M.C.I.P., R.P.P.
Chief A i strative Officer
-----
arie Marano, H.BSc.,AMCT
Tr surer
----------------------------- --
Jo�ertnr eph Caruana,
D' of Community Services
FW/MAM/JC/pp
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SPECIAL RUN 3-NEW RECREATION COMPLEX-ElOWMAMVILLE(2007) �
AND NEW TVWK PAD -COURTiCE REMOVED N
MUNICIPALITY OF CLA,RINGTON
RESIDENTIAL DEVELOPMENT CHARGES
PER CAPITA AND PER UNIT
r
a
Charge Charge By Unit Type(1)
Per Single Townhouse Apartments
Capita &Semi /Row /Multiples
General Government $22.22 $74.44 $64.44 $44.44
Library Board $102.03 $341.80 $295.89 $204.06
Fire Department $84.29 $282.37 $244.44 $168.58
Indoor Recreation $275.33 $922.36 $798.46 $550.66 °
z
Parik Development and Facilities $251.50 $842.53 $729.35 $503.04
Public Works Department $10928 $366.09 $316.91 $218.56
Sub-Total General Services $844.65 $2,829.58 $2,449.49 $1,689.30
Roads and Related $784.58 $2,628.33 52,275,27 $11,589.15
Total Municipal Charge $9.629.23 $5,458 $1,725 $3,258
1) Based on Persons Per Unit Cif_ 3.35 2.90 2.00
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NE11fISON
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THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
ATTACEMNT #5
Memorandum
Marie Marano, Treasurer JUL 2 1 199,q
To:
Joseph P. Caruana, Director of Community Services MUNICIPALITY OF C'LARING10IN
From: FINANCE
Date: July 21, 1999
DEVELOPMENT CHARGES
Subject:.
------------------ --------------------------- ---------
As requested, I have extrapolated the development period for Indoor Recreation capital
projects over 15 years from the original 10-year period. Further, it is suggested that the
projections used may appear to be optimistic and that a revised projection in line with the
Region's estimate of 800 units (down from 1100) per year may be a more reasonable
assumption.
Based on the revised projections, we will experience a population increase of 2,184 each year.
Our current standard for the two major recreational facilities components is as follows:
0 1 arena per 13,330 population
0 1 pool per 33,325 population
Using the projected population increase of 2,184 per year and our existing facility standard we
will require an additional ice pad every 6 years and an additional pool facility in the 15" year
of the development period.
As such, the impact to the Indoor Recreation Capital forecast is as follows:
YEAR PROJECT COST
2001 Courtice Community Complex Expansion $2,145,000.
2004 (Prev. 2003) Darlington Sports Centre Expansion 5,445,000.
2010 (Prev. 2008) Twin Pad Complex Courtice 12,375,000.
2013 (Prev. 2007) New Recreation Complex Bowmanville 11,550,000.
In accordance with our standard, we have identified the new Twin Pad Complex in Courtice
for the year 2010. Although we can only justify a single pad, consideration for oversizing will
have to be made at that time given the reality that it is not economically feasible to operate a
single pad arena facility.
/2
Page 2
If implemented, the two major components (i.e.) Twin Pad Complex in Bowmanville will be
moved outside the 10-year scope of the development charge and will not be applicable at this
time, reducing the total Indoor Recreation Capital Component by $23,925,000.
I trust this information is as requested. If you require further information or have any
stions, please do not hesitate to contact me.
rl
ose P. Caruana, Director
o unity Services Department
JPC/pg
PC: Frank Wu, CAO