HomeMy WebLinkAboutADMIN-25-99 THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
REPORT
Meeting: Council File #
Date: July 19 1999 Res. #
Report #: ADMIN 25-99 By-law #
Subject: DEVELOPMENT CHARGES
Recommendations:
It is respectfully recommended that Council approve the following:
1. That Administrator's Report ADMIN. 25-99 be received;
2. That the Capital Works forecast as contained in the Development Charges
Background Study — Final Report, July, 1999 be approved;
3. That Council in approving the Background Study, expresses its intent to ensure that
the increase in the need for services attributable to the anticipated development will
be met, and that any future excess capacity identified in the Study will be paid for
by development charges or other similar charges;
4. That the Municipality of Clarington not impose a charge related to Hydro Electric
Services;
5. That the Municipality of Clarington not impose a charge on industrial development;
6. That the Development Charges By-Law attached to this report be approved;
7. That the attached by-law authorizing the close out of existing Development Charges
Reserve Funds, establishment of new Development Charges Reserve Funds, and
transfer of previous fund balance into new funds, be approved;
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8. That staff continue working with Hemson Consulting Ltd. to expand the scope of
the financial impact analysis and report back to Council dealing with such matters
as operating cost impact, cash flow analysis, etc. as related to the capital works
program developed for the Development Charges Study; and
9.' That although the proposed development charge by-law has been changed
following the statutory meeting held by Council on June 14, 1999 respecting the
Development Charges Background Study, the Municipality of Clarington, dated
May, 1999, and a Final Background Study dated July, 1999 has been prepared and
is before Council for approval, Council hereby determines that a further public
meeting under section 12 of the Development Charges Act is not necessary
regarding the Background Study dated May, 1999, the Final Background Study
dated July, 1999 and the proposed by-law as changed;
10. That all delegations be acknowledged and be advised of Council's decision.
1. BACKGROUND
1.1 As per the requirements of the Development Charges Act, 1997, the Municipality of
Clarington commenced in the spring of 1998, a process of review and study that
would lead to the passing of a new Development Charges By-law on or before
August 31 1999, being the sunset date for the expiry of the current by-law.
1.2 The comprehensive background study was carried out by Hemson Consulting Ltd.
with the assistance of Totten Sims Hubicki Associates, and the study process was
guided by a staff Steering Committee, including representatives from the Library and
Clarington Hydro.
1.3 Prior to the release of the Background Study, information sessions were held with
Council and members of the land development and home building industries in
April and May 1999 respectively. On May 25'", the Background Study was released
and on June 14th a statutory public meeting was held and comments from all
delegations were referred to staff for review.
2. RESPONSE TO PUBLIC COMMENTS
2.1 At the public meeting held on June 14'" 1999, three individuals spoke with respect
to their specific concerns of the proposed Development Charges By-law. Of these
three individuals, the Durham Home Builders' Association and the Urban
Development Institute (Durham Chapter) have also submitted their concerns in
writing. Copy of their written comments are attached to this report, (attachment
#1)
2.2 Staff have reviewed the concerns and would offer the following comments:
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2.2.1 Concern: Increase of almost $1,400 per unit is alarming.
Response: Although there is no denying that the proposed charge for a single
detached/semi dwelling of $6,541.26 is $1,410.46 higher than the current charge of
$5,131.00, any true comparison should take into account the following factors:
• The current charge was calculated and reduced to account for provincial
subsidies in the amount of $9.69 million. If this amount was not available in the
calculation, the current charge of $5,131 would have to be increased by $898 to
$6,029. Subsidies from the Provincial government have been reduced and
subsequently totally removed in 1997 and are no longer available to allow
municipalities to use this fund to reduce development charges.
• The current charge has not been indexed since May 1995 as Council conceded
to the development industry's request. Assuming continuous indexing, the
current charge should be $5,432 today.
• When taking into account of both indexing and provincial grant, the current
charge should be adjusted by adding $301 (indexing), and $898 (provincial
grant) to the base rate of $5,131. This would result in a charge of $6,330, which
would be an amount that can be compared to the proposed charge of $6,541.
Under this scenario, the increase is only 3.3%.
• Based on the above facts, our proposed charge is neither excessive nor
exorbitant as may have been suggested.
2.2.2 Concern: Increase of indoor recreational facilities be scaled back.
Response: The portion of the proposed indoor recreation charge is $2,005 as
opposed to the current charge of $831. This large increase was due to the
following:
• Previous comments on indexing and provincial grant apply.
• Previous charge was based on a lower level of service standard between 1982
— 1991. With construction of the Rickard Complex addition and the Courtice
Community Centre to meet the demands of growth, the average per capita
value of indoor facilities has increased. This higher average standard is used in
the calculation of the proposed charge, and hence a higher charge in the
component of indoor recreation. It should be noted that the maximum
allowable charge for indoor recreation was not assessed in the prior
development charge and as a result, the differential is now larger than it
otherwise would have been.
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Four indoor recreational projects are identified between 1999 and 2008. They
are tentatively scheduled as follows:
a) Courtice Community Centre (fitness centre expansion) (2001)
b) Darlington Sports Centre (twin pad) (2003)
c) New Recreation Complex for Bowmanville (2007)
d) New twin pad arena for Courtice (2008)
These four projects account for an estimated cost, including land, building and
equipment, of $35.3 million of which only $20.7 million are attributed to growth-
related cost. The calculation of the charge of this component utilized the lower cost
of $20.7 million is consistent and in accordance with the regulations set out in the
legislation.
It is noteworthy that since 1975 the Municipality has only added the Courtice
Community Complex and the second pad at the Rickard Recreation Complex (the
original building was a replacement for the old Bowmanville Arena) to its
recreational facility complement. All existing facilities are, for the most part,
operating at capacity and current needs of the community cannot be completely
accommodated. New residents to our community will expect and demand that the
appropriate recreation facilities are in place to meet their recreational and leisure
requirements.
In order to reduce the charge regarding the indoor recreation component, the above
project(s) will have to be deleted in the ten year capital program used in the
calculation. Staff is not in support of any deletion as the Municipality will not be
able to meet the demand from future residents for indoor recreational facilities, and
will lead to gradual deterioration of level of service. When the next round of
development charge calculation is done (maximum 5 year review), the Municipality
will feel the adverse effect, because, for the purpose of calculating development
charges, one of the legislated criteria requires municipalities to rely on a standard
no higher than the average standard of previous 10 years. In short, the municipality
should not allow any deterioration of the standard of service, now or in the future, if
it were to ensure the quality of life of its current and future residents.
2.2.3 Concern: Charge should be payable at time of building permit.
Response: Currently, the Municipality collects development charges up front at
time of execution of a subdivision agreement for 25% of the total units, and the
balance payable by 25% segments on anniversary date subject to specific variations
in the different agreements. Although this policy has not been a noticeable problem
for the developer in the past, staff are cognizant of the fact this payment schedule
may occasionally cause cash-flow problems for the developer.
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On the administration side, the current policy requires significant staff time to track
and monitor each subdivision for payment and could be a long drawn out process,
particularly when larger subdivisions usually take many years to reach built-out. In
this regard, payment at time of building permit has considerable merits. Many
municipalities in the GTA are adopting this approach. Accordingly, we have
incorporated this payment policy in the By-law.
2.2.4 Concern: Requested the effective date of the By-law be August 31 1999.
Response: We recommended all along that the effective date be September 1 1999
despite the fact that the Municipality has the power to make the By-law effective on
the date of passing. The By-law as recommended has included this provision.
2.2.5 Concern: Suggested the increase be phased in 1/3 on September 1 1999, 1/3 on
March 1 2000, and final 1/3 plus indexing on September 1 2000.
Response: Assuming 700 residential unit building permits will be issued between
September 1 1999 and September 1 2000, the requested phase-ins would result in a
shortfall of approximately $443,000, an amount which would have to be captured
through other sources in order to finance future capital projects. As the tax base is
the only source, staff would not recommend any phase-in as it defeats the
fundamental principle that developments are to pay the growth related costs. In
addition, the cash flow analysis, prepared by the consultant incorporates an
estimated amount of revenue to finance future capital works. Any adjustment or
shortfall in revenue has a major impact on the ability of the Municipality to fund
these capital works.
2.2.6 Concern: Capital planning for the future growth areas be flexible.
Response: Staff conferred with the U.D.I. to seek clarification of this concern. It
appears that since the proposed 10 year and 20 year capital works are based on the
anticipation of growth in certain areas of the municipality, and each project was
identified for implementation by a specific year, it may not be flexible to allow
certain projects, particularly road constructions to vary from the anticipated year of
construction in order to accommodate new growth. In addition, they are
concerned that the Municipality may deem a subdivision premature because a
capital works project such as a road or recreational facility are not in place and are
not scheduled for construction until the latter years of the capital,works program.
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Staff appreciates the concern raised by the development industry and wish to assure
the industry that it is not the intent of the Municipality to adhere to the exact timing
of every project in the capital works program. The specific year identified for each
project is intended as a guide. As new residential development occurs, Council can
through its annual budgeting process, make minor changes provided they do not
adversely affect the cash flow and operating costs of the Municipality.
3. HIGHLIGHTS OF DEVELOPMENT CHARGES BY-LAW
The By-law attached to this report (Attachment #2) was drafted by the consultant
and subsequently reviewed by the Steering Committee and revised by the
Municipal Solicitor. The highlights of the By-law are as follows:
3.1 Residential Charges:
Charge by Unit Type
Single & Semi Low Density Apartments
Multiple
Services $/Unit $/Unit $/Unit
1. General
government $74.44 $64.44 $44.44
2. Library Services $341.80 $295.89 $204.06
3. Fire Protection
Services $282.37 $244.44 $168.68
4. Indoor Recreation $2005.91 $1,736.46 $1,197.56
5. Park development
and Facilities $842.53 $729.35 $503.00
6. Public Works
Department $366.09 $316.91 $218.56
7. Roads and Related
Engineering
Services $2,628.33 $2,275.27 $1,569.15
TOTAL CHARGE - $6,541.46 $5,663 $3,905
$/U N IT
3.2 Non-Residential Charges:
Except for industrial development and those exemptions noted in the By-Law, all
other uses are subject to the following charges:
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Charge per Gross Floor Area
Services $/sq.m $/sq.ft
1. General Government $0.47 $0.04
2. Library Services N/A N/A
3. Fire Protection Services $2.29 $0.21
4. Indoor Recreation N/A N/A
5. Park Development and
Facilities N/A N/A
6. Public Works
Department $2.33 $0.22
7. Roads and Related
Engineering Services $14.67 $1.36
Total Charge $19.76/sq.m $1.83/sq.ft.
3.3 Hydro Charges
With respect to the Hydro-Electric charge, the Clarington Hydro-Electric
Commission advised that it would not proceed with hydro development charges at
this time for its service areas. Accordingly, the draft by-law has been revised to
reflect this.
3.4 Exemptions
3.4.1 The by-law provides for exemptions for housing intensification, agricultural uses,
temporary buildings, certain institutional uses, and industrial expansion, all subject
to certain rules as stipulated in the By-law.
3.4.2 With respect to the industrial expansion exemption, the legislation stipulates that
charge does not apply to any expansion that is 50% or less; and if the expansion is
over 50%, only the amount above the 50% is subject to charge. There is no
prohibition, if the Municipality chooses, to widen the scope of exemption. In this
regard, we understand the Region and several other municipalities are considering
total exemption for industrial development. For consistency purposes, staff are
recommending total industrial exemption. Council should be aware that this
exemption will result in a shortfall of collectible charges, which would have to be
made up by other revenue sources in order to finance future capital works to meet
the needs of future industrial growth. Staff will explore these other revenue sources
including general tax subsidies, contributions by industrial developers, frontage
charges, etc., and will recommend to Council at a later date of the most appropriate
policies to address this issue.
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3.5 Timing of Collection
As stated previously, staff is recommending the timing of collection be at building
permit issuance.
3.6 Front Ending Agreement
The By-law indicates the Municipality may enter into an agreement for the provision
of services, such as roads, water, sewer, and storm water. It provides that the costs
of the work to be done in a specific area are to be borne by one or more of the
parties to the agreement. It also provides for persons who, in the future, develop
land within the area defined in the agreement, to reimburse some part of the costs
of the work.
We expect the Municipality will be requested to consider front-ending agreements,
particularly in the area of storm drainage facilities. In this regard, it is recommended
that the option to consider front ending agreement to remain open and each request
will be considered on its own merits.
3.7 Indexing
The By-law provides for indexing annually commencing with the first indexing to
occur on July 1 2000 in accordance with Statistics Canada Quarterly Report on
Construction Price Statistics in the 12 month period ending March 31. This is
consistent with the indexing proposed by the Region of Durham.
3.8 Existing Agreement
In compliance with the legislation, the Municipality will honour all terms and
conditions as stipulated in all existing subdivision and site plan agreements
executed prior to September 1 1999.
3.9 Effective Date and Transitional Issues
The effective date of the New Development Charges By-law will be September 1
1999, despite the fact that the Municipality could make the new by-law effective on
the day of passing. This accommodates the request of the development industries.
It is likely that the Building Division will be faced with a large volume of permit
applications prior to September 1 to take advantage of the current lower charge.
In order to avoid potential disputes as to how the new rates are applied to permit
applications in process, staff recommend that 4 p.m., August 31 1999, be the last
day the Municipality would apply the current charges to all permit applications
received on or before the said time and date, provided the permit applications are
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complete and meet the requirements of the Municipality, including payment of all
necessary application fees, completeness of plans and drawings, etc.
4. CHARGES IN OTHER MUNICIPALITIES
For the information of Council, we have obtained from the Region, the proposed
charges in other municipalities. This information is provided in Appendix "A" to
this Report.
5.0 OTHER FINANCIAL ISSUES
5.1 Reserve Funds
The existing Development Charge Reserve Funds are to be closed out, and any
balances, negative or positive, are to be transferred into the new Reserve Funds in
accordance with the Development Charges Act. The following table identifies the
existing funds, balances to be transferred, and the new funds to be created under
the Development Charges By-law.
New Reserve Funds Balances Existing Reserve Fund —
-------------------------------------------- Development Charges
Residential Non-Residential
1. General Government $30,025 $51299 1. Civic Administration
2. Library Services ($1,618,800) N/A 2. Library
3. Fire Protection $276,251 $48,750 3. Fire
Services
4. Indoor Recreation ($1,204,522) N/A 4. Community Services
5. Park Development and N/A N/A
Facilities
6. Public Works N/A N/A
Department
7. Roads and Related $962,275 N/A 5. Public Works
Engineering Services
TOTAL ($1,554,771) $54,049 Balance ($1,500,722) to
be funded through future
development charges
The legislation provides that a separate Reserve Fund be established for each service to
which the development charge relates. The By-law (Attachment #3) closing out existing
funds, transferring and establishing new funds is attached hereto.
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5.2 Cash Flow Analysis
The consultant prepared, as part of the background study, an analysis of the cash
flow related to the anticipated development charge contributions to be received.
These assumptions are based on the population growth forecast and the anticipated
timing of the capital projects.
There is an interest factor of 7% built into the analysis to account for interest
earned, and an inflation rate of 2.5% has been applied to the funding requirements.
The Roads/Engineered Services analysis was primarily devoted to the analysis of
works required. Only a preliminary cash flow analysis has been prepared by the
Consultant for the Roads portion of the quantum to verify the matching of the
collections with the cost. It is therefore recommended that this analysis be
completed over the next few months, along with a more detailed operating/tax
impact analysis, in order to be reasonably assured that the quantum is sufficient to
support the projects identified.
5.3 Operating Cost Impact/Tax Impact
The Act requires as part of the background study, an examination of the long term
capital and operating costs for the capital infrastructure for the services included in
the charges. The consultant has incorporated an operating cost based on the
services and service standards included in the charges. In order to fully assess the
financial capability of the Municipality to fund and to operate the proposed capital
projects, a comprehensive tax impact analysis is warranted.
For example, Section 2.2.2 of this Report points out that the total cost of all indoor
recreation facilities at $35.3 million, of which only $20.7 million is used in this
calculation to determine the charges. Consequently the difference of $14.6 million
will be required from the tax base, including tax supported debentures, or alternate
sources of funding, in order for the projects to proceed before the conclusion of the
ten year period. The implication on the tax base of these projects, along with the
added impact of the operations cost of facilities, supports the recommendation to
allow further time to fully explore the overall impact and quantum of the revised
development charge.
It is proposed that over the next few months, staff work with the consultant to
identify the full and comprehensive tax impact and report back to Council. If the
conclusion of the analysis is a recommended adjustment to the quantum, it would
be effective in the early part of 2000, after the required public information meetings
had been satisfied. If there is not a significant change to the quantum resulting from
the analysis, no change would be recommended. This additional time will allow
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staff to fully assess the tax base ability to support the charge and the capital plan.
The cost of this analysis is directly attributable to the requirements under the
legislation and as such it will be funded from development charges.
5.4 Financing Future Capital Works
The capital works have been built into the charges, such that the revenues collected
will as closely as possible, match the timing of the expenditure. This projection
provides for the assumption of interest earned and inflation applied to costs as
stated in the cash flow discussion above. Staff have some concern with the
projections resulting from the cash flow models. There has not been any separate
or specific interest factor built into the analysis for the potential to debenture any of
the projects. Therefore any advancement of projects in time may alter the timing of
other projects, or the ability of the Development Charge Reserve Fund to match the
project cost.
In addition, the capital works program for Roads has not undergone the detailed
timing analysis. As stated above, it is recommended that this be undertaken in
future months, particularly in recognition of a significant 40% value of the roads
element in the total charge ($2,628 of $6,541). These concerns will be reviewed
and addressed on a comprehensive basis in the recommended future study.
6. CONCLUSION
The Development Charges Study was prepared consistent with the requirements
stipulated in the legislation and the proposed charges are considered fair and
equitable, meeting the objective of ensuring current and future tax dollars would
not subsidise any growth related costs.
Respectfully submitted,
Franklin Wu,
Chief Administrative Officer
Appendix "A" — Development Charges in Other Municipalities
Attachment #1: Letters from Home Builders' Association and from U.D.I.
Attachment #2: Development Charges By-Law
Attachment #3: Reserve Fund By-Laws
1999 Proposed Uniform'Residential Development Charges
Per Fully Serviced
Single Detached Dwelling Unit
for Greater Toronto Area Municipalities
(as of July 1999)
LOWER TIER JULY1999
RANK MUNICIPALITY UPPER TIER MUNICIPAL ELECTRICAL SUB-TOTAL EDUCATION TOTAL
1 Ajax 8,545 4,101 n/c 4,101 1,728 14,374
2 Brock 8,545 4,882 n/c 4,882 1,728 15,155
3 Clarington 8,545 6,541 n/c 6,541 n/c 15,086
4 Oshawa 8,545 4,740 n/c 4,740 1,728 15,013
5 Pickering 8,545 6,307 n/c 6,307 1,728 16,580
6 Uxbridge 8,545 4,210 n/c 4,210 1,728 14,483
7 Whitby 8,545 4,818 442 5,260 1 728 15,533
Figures represent uniform municipal charges. In some municipalities,there are additional area-specific development
charges in defined areas.
2 A component of the charge is calculated on another basis than is shown(eg.partially a per hectare charge) and has
been converted to a hypothetical single detached unit charge for use in this table.
n/c No charge
EXISTING
LOWER TIER MAY 1999
RANK MUNICIPALITY UPPER TIER MUNICIPAL ELECTRICAL SUB-TOTAL EDUCATION TOTAL
1 Ajax 7,308 5,632 606 6,238 1,728 15,274
til 1-d
>
2 Brock 7,308 4,078 196 4,274 1,728 13,310 0 z
3 Clarington 7,308 5,131 629 5,760 n/c 13,068
4 Oshawa 7,308 4,056 503 4,559 1,728 13,595 y
5 Pickering 7,308 4,882 665 5,547 1,728 14,583 z o
6 Uxbridge 7,308 4,321 0 4,321 1,728 13,357 n',
v
t
7 Whitby 7,308 4 967 464 5,431 1,728 14 467 1
C.N.Watson and Associates Ltd. DURCLAR.WK4-3 \ (07/09/99) 10:13 AM
1999 Proposed Uniform'Non-Residential Development Charges
Per Fully Serviced Square Foot of GFA for
Non-Residential Buildings(Industrial Buildings)
for Greater Toronto Area Municipalities
(as of July 1999)
LOWER TIER JULY1999
RANK MUNICIPALITY UPPERTIER MUNICIPAL ELECTRICAL SUB-TOTAL EDUCATION TOTAL
$/s .ft. $/s .ft. $/s .ft. $/s .ft. $/s .ft. $/s .ft.
1 Ajax 0.00 0.93 n/c 0.93 0.80 1.73
2 Brock 0.00 2.00 n/c 2.00 0.80 2.80
3 Clarington 0.00 1.83 n/c 1.83 n/c 1.83
4 Oshawa 0.00 1.27 n/c 1.27 0.80 2.07
5 Pickering 0.00 0.28 n/c 0.28 0.80 1.08
6 Uxbridge 0.00 1.98 n/c 1.98 0.80 2.78
7 lWhitby 0.00 1 0.00 1 0.00 0.00 1 0.80 1 0.80
' Figures represent uniform municipal charges,including those applicable to non-exempt institutional development. In
some municipalities,there are additional area-specific development charges in defined areas.
2 A component of the charge is calculated on another basis than is shown(eg.wholly or partially a per acre/hectare
charge or for electrical on a service size basis)and has been converted to a hypothetical per square foot of gross floor
area for use in this table.
n/c No Charge
EXISTING
LOWER TIER MAY 1999
RANK MUNICIPALITY UPPER TIER MUNICIPAL ELECTRICAL SUB-TOTAL EDUCATION TOTAL
$/s .ft. $/s .ft. $/s .ft. $/s .ft. $/s .ft. $/s .ft.
1 Ajax n/c 0.00 0.59 0.59 0.80 1.39
2 Brock n/c 0.00 0.29 0.29 0.80 1.09
3 Clarington n/c 0.00 0.00 0.00 n/c 0.00
4 Oshawa n/c 0.00 0.00 0.00 0.80 0.80
5 Pickering n/c 0.00 1.02 1.02 0.80 1.82
6 Uxbridge n/c 1.46 0.00 1.46 0.80 2.26
7 Whitby n/c 1 0.00 0.00 0.00 0.80 1 0.80
C.N.Watson and Associates Ltd. DURCLAR.WK4-3\ (07/09/99)10:13 AM
Single Detached Dwelling Unit
for Hamilton-Wentworth Niagara Ottawa-Carleton and Greater Toronto Area Municipalities_
(as of July 1999)
PROPOSED
LOWER TIER EXISTING JULY 1999
RANK MUNICIPALITY U MUNICIPAL ELECTRICAL SUB-TOTAL EDUCATION TOTAL
1 Aurora 9,120 7,316 730 8,046 2,350 19,516
2 Vaughan 9,120 7,255 700 7,955 2,350 19,425
3 Richmond Hill 9,120 5,863 958 6,821 2,350 18,291
4 Whitchurch-Stouffville 9,120 5,330 n/c 5,330 2,350 16,800
5 Pickering 8,545 6,307 n/c 6,307 1,728 16,580
6 Mississauga 5,614 8,008 525 8,533 2,271 16,418
7 Brampton 5,614 7,344 517 7,861 2,271 15,746
8 Whitby 8,545 4,818 442 5,260 1,728 15,533
9 Clarington 8,545 6,541 n/c 6,541 n/c 15,086
10 East Gwillimbury 9,120 3,712 n/c 3,712 2,350 15,182
11 Brock 8,545 4,882 n/c 4,882 1,728 15,155
12 King 9,120 3,652 n/a 3,652 2,350 15,122
13 Oshawa 8,545 4,740 n/c 4,740 1,728 15,013
14 Oakville 6,171 6,947 337 7,284 1,269 14,724
15 Uxbridge 8,545 4,210 n/c 4,210 1,728 14,483
16 Ajax 8,545 4,101 n/c 4,101 1,728 14,374
17 Georgina 9,120 2,853 n/c 2,853 2,350 14,323
18 Halton Hills 6,171 5,073 649 5,722 1,269 13,162
19 Milton 6,171 5,240 n/c 5,240 1,269 12,680
20 Burlington 6,171 4,300 n/c 4,300 1,269 11,740
21 Gloucester 2,978-11,658 2,004-4,096 n/c 2,004-4,096 1,254 6,236-17,008
22 Stoney Creek 3,844 5,448 n/c 5,448 1,123 10,415
23 Cambridge 4,728 4,777 591 5,368 n/c 10,096
24 Kitchener 4,728 5,087 n/c 5,087 n/c 9,815
25 Niagara Falls 2,500 5,403 n/c 5,403 n/c 7,903
26 Toronto n/c 5,003 n/c 5 003 n/c 5,003
1 Figures represent uniform municipal charges. In some municipalities,there are additional area-specific development
charges in defined areas.
n/c No charge
Rank 1999 Proposed Rates. Base on mid-point where applicable.
C.N.Watson and Associates Ltd. PROPCLAR.WK4-3\ (07/09/99)10:26 AM
1999 Proposed Unifomel Non-Residential Development Charges
Per Fully Serviced Square Foot of GFA for
Non-Residential Buildings(Commercial/Institutional/Industrial)
for Hamilton-Wentworth Niagara Ottawa-Carleton and Greater Toronto Area Municipalities
(as of July 1999)
PROPOSED
LOWER TIER EXLSTING JULY 1999
RANK MUNICIPALITY UPPER TIER MUNICIPAL ELECTRICAL SUB-TOTAL EDUCATION TOTAL
$/s .ft. $/ .ft. $/s .ft. $/s .ft. $/s .ft. $/ .ft.
1 Mississauga 2.40 3.30 056 3.86 0.85 7.11
2 Brannpton2 2.40 1.57 1.30 2.87 0.85 6.12
3 Oakville 2.39-3.58 2.00 0.42 2.42 0.47 5.28-6.47
4 Aurora 1.29-2.50 1.67 0.86 2.53 0.96 4.78-5.99
5 Milton 2.39-3.58 1.93 n/c 1.93 0.47 4.79-5.98
5 Halton Hills 2.39-3.58 1.52 0.20 1.72 0.47 4.58-5.77
7 Burlington 2.39-3.58 1.69 n/c 1.69 0.47 4.55-5.74
8 Vaughan 1.29-2.50 1.16 0.73 1.89 0.96 4.14-5.35
9 Brock 0-3.67 2.00 nt/c 2.00 0.80 2.80-6.47
10 Uxbridge 0-3.67 1.98 n/c 1.98 0.80 2.78-6.45
11 Gloucester 1.35-2.70 0.58-2.49 ne/c 0.58-2.49 1.03 2.96-6.22
12 Richmond Hill 129-2.50 0.57 0.96 153 0.96 3.78-4.99
13 Stoney Creek 0-3.34 1.67 n/c 1.67 0.87 2.54-5.88
14 Whitchurch-Stouffville 1.29-2.50 1.26 n/c 1.26 0.96 3.51-4.72
15 East Gwillinebury 1.29-250 123 n/c 1.23 0.96 3.48-4.69
16 Clarington 0-3.67 1.83 n/c 133 n/c 2.18-5.85
17 Oshawa 0-3.67 1.27 rn/c 127 0.80 2.07-5.74
18 Georgina 1.29-2.50 0.99 n/c 0.99 0.96 3.24-4.45
19 King 1.29-2.50 0.97 ii/a 0.97 0.96 3.22-4.43
20 Ajax 0-3.67 0.93 In/c 0.93 0.80 1.73-5.40
21 Cambridge 1.98 1.13 n/c 1.13 n/c 3.11
22 Pickering-- 0-3.67 028 n/c 0.28 0.80 1.08-4.75
23 Toronto n/c 2.91 n/c 2.91 n/c 2.91
[23 Whitby' 0-3.67 0.22 0.03 0.25 0.80 1.05-1.72
25 Kitchener 1.98 0.52 n/c 0.52 n/c 2.50
26Niagara Falls* 1.00 0.20-1.19 n/c 0.20-1.19 n/c 1.20-2.19
1 Figures represent uniform municipal charges,including those applicable to non-exempt institutional development.In
some municipalities,there are additional area-specific development charges in defined areas.
2 A component of the charge is calculated on another basis than is shown(eg.wholly or partially a per acre/hectare charge
or for electrical on a service size basis)and has been converted to a hypothetical per square foot of gross floor area for use
' The municipal portion of the commercial charge will be phased-in over a four year period at$0.25 increments.Industrial
development is exempt from DC's.
' The regional portion of the charge will be pleased-in over a four year period at$0.30 increments.
The municipal portion of the charge will be phased-in over a three year period at$028 increments.
Education:
Actual rate is calculated as a percent of building pennit as per DCA;sample conversion to a rate per square foot of floor
area has been calculated assuming average construction costs of$60/s.f.The actual EDC as a percent of declared building
pemnit value for the school boards is as follows:
York Region Roman Catholic Separate School Board 0.497%;York Region Board of Education 1.102%
Durham Board of Education 1.07%,Durham Region Roman Catholic Separate School Board 0.26%
Peel Board of Education 1.0%,Dufferinn-Peel Roman Catholic Separate School Board 0.42%
Halton Board of Education 0.47%,Halton Roman Catholic Separate School Board 0.31%
m/c No Charge
Rank 1999 Proposed Rates. Base on mud-point where applicable.
C.N.Watson and Associates Ltd. PROPCLAR.WK4-3\ (07/09/99)10:26 AM
ATTACHMENT #1
Durham TO REPORT ADMIN.25-99
Region
Home Builders'
Association
King Street Postal Outlet
P.O. Box 26064
�/ 206 King Street East,
171041te *7ea4,tt Oshawa, Ontario L1 H 1 CO
Tel. (905) 579-8080
Fax (905) 579-8080
June 11, 1999
FACSIMILE AND MAIL
Municipality of Clarington
40 Temperance Street
Bowmanville, Ontario
L1 C 3A6
Attention: Mr. Franklin Wu, M.C.I.P.
Chief Administrative Officer
Dear Sir:
Re: Proposed Development Charge By-Law
We are forwarding this letter to express our concerns in advance of the upcoming public
meeting which we understand is scheduled for Monday, June 14, 1999. We have
reviewed the background reports and we have a number of concerns. We have also
had an opportunity to converse with UDI Durham regarding this matter.
UDI Durham will be presenting a comprehensive response regarding your proposed by-
law. Rather than restate the various matters set out therein, we would rather highlight
the most significant matter of concern. Specifically, the proposed increase for all unit
types is alarming. For the most common unit types (townhouses, singles and semis) the
range of increase is in the order of $1,200 to $1,400 per unit. The Region of Durham
also proposes increases for development charges. Coupled with the Region of Durham
increases, single family units will be facing a combined development charge increase of
$2,600+. This is a substantial burden to be placing on development in the Municipality
of Clari'ngton. Clarington, as you are aware, is a highly price sensitive market. The net
result of these proposed increases, should they proceed, is that the new home
marketplace in Clarington will be greatly subdued. The area builders cannot absorb the
cost increases and they will be passed onto the new home buyers. Accordingly, prices
will increase and the level of new home sales will decrease.
2/
Municipality of Clarington
Mr. Franklin Wu, M.C.I.P.
June 11, 1999
Page 2
The development charges are a means by which a municipality is able to collect funds
to pay for infrastructure improvements to allow for new development. Where the
proposed development charges are set to facilitate new growth, then clearly it becomes
a cost of doing business. However, if the development charges are set such that they
include costs that aren't essential to new development, then these should be reviewed
and questioned. In this specific case, we are very concerned that they are brought
about largely on the basis-of an increase for indoor recreational facilities. The- current
by-law allows for a charge of$831 per single family unit for indoor recreational facilities.
The proposed by-law increases this rate to $2,005 per unit. In essence this is the value
of the overall increase. We are requesting that the Municipality of Clarington review the
proposed changes and scale back the component for indoor recreational facilities to the
current level.
As we understand, at the current level of$831 per unit for indoor recreational facilities,
the per capita contribution would be roughly $250 per person. With a population
increase forecast, in new units, over the next ten years of 34,326 persons at a rate of
$250 per capita, the end result would create a fund of $8.6 million for indoor recreation
facilities. Accordingly, we are requesting that the Municipality review the proposed
program to coincide with a budget in that order of magnitude.
As previously stated, we are supportive of the UDI position on the proposed
development charge by-law. The various issues are of equal concern. We respectfully
request that the Municipality address all these matters, and especially this one particular
issue, as the matter of greatest concern. We are available to discuss any of these
issues at your convenience.
Yours truly,
DURH REGION HOMEBUILDER'S ASSOCIATION
7
Peter Saturno
President
RFT/br
cc: Executive Officer- Kent Young
First Vice President - Brian Collins
Second Vice President- Wayne Clarke
Chairman, Legislative Affairs Committee - Rick Tranquada
UDI, Durham — Kelvin Whalen
Urban Development Institute / ®ntarie
Durham Chapter
June 1.4, 1999
Ms. Patti Barrie,Clerk
The Municipality of Clarington
40 Temperance Street.
Bowmanville, Ontario
L1C 3A6
Dear Ms. Barrie,
Re: Comments on Proposed Development Charge Background Study
On behalf of the Durham Chapter of the Urban Development Institute(UDI), I would like
to offer the following comments on the above-noted study and proposed Development
Charge By-Law which will be the topic of a Public Meeting at the Municipality on
Monday June 14, 1999.
i General
As a general comment we are alarmed at the increase in rates being proposed in both the
residential and non-residential sectors. With an increase of almost $ 1,4000 or 25% from
the current rate, Clarington will have one of the highest rates of any Municipality in
Durham Region, despite having the lowest market rates of all the Lakeshore
municipalities. We fear that adopting a charge at the level proposed in the report, will
make Clarington even less competitive with the other municipalities, resulting in a
decrease in building permit activity, and accordingly a decrease in development charge
revenue to fund these capital projects.
ii) Indoor Recreation
It becomes apparent upon reviewing the study, that the single largest component increase
is that of the Indoor Recreation. While we do not dispute the methodology used to
calculate this number we do caution that it appears to be a inordinate increase from the
current charge.
In fact, the current charge for Indoor Recreation which is presently at $ 852.97 per single
detached dwelling is proposed to increase to S 2,005.91 per dwelling with the new by-law
- an increase of over $ 1,150.00 per dwelling. .../2
- 2 -
The exorbitancy of this charge becomes especially evident when it is compared to the rates
proposed for Pickering 963 per dwelling), Ajax($ 1,120/dwelling) and Oshawa
($ 839/dwelling). The charge for the Town of Whitby had not yet been made available as
of the date of this letter.
Furthermore, Council should be aware that the provision of these facilities will mean that
the Municipality will incur the responsibility to operate, maintain, and repair these facilities
- costs which would be borne by the ratepayers of the Municipality:
It would therefore be prudent for Council to consider reducing the amount of this i
component to be more in fine with t at o o er municip sties.
iii)PaymentTimin�
i
Although the background study makes no mention of the proposed timing for
development charge payments, we would strongly urge that the eventual by-law should '.
adopt a policy wherein the charge is payable individually at the time of building permit
ac ui�g sition which is the practice followed by the rest of the Region and almost all other .
municipalities of the GTA. l
The current practice of paying a portion of the aggregate charge at the time of the first
permit and thereafter individually has proven difficult for both the builder and staff from an
administrative standpoint.
iv) Transition
At the time of the by-law being passed, we would request that thQeffective date be as of
August 3.1, 1999 in order to provide the industry with sufficient time to accommodate
changes to the new by-law. For example new project budgets would have to be submitted
to the banks and financing partners based upon the new.charges and time must be
provided to allow these institutions to address these changes.
Any subdivision agreements executed and delivered to the Municipality after that date
would be subject to the new by-law and its policies.
We would suggest that whatever new level of charge is adopted by the Municipality,
should be.phased in to allow the building industry to gradually absorb the new costs into:
the eventual product. A pre red model would be to implement 1/3 of the increase on
September 1, 1999, another 1/3 on March 1, 2000 and the final 1/3, plus indexing, on
September 1, 2000.
- 3 -
This will allow allows some time for the market to absorb the new increase and i
particularly for small builders to gradually absorb the new cost structure into their product
pricing.
. f.
0 Growth Prioritization ,-
Finally, while not related to the charge itself, it has been observed that the land areas noted
for growth on the map attached to the report have generally been grouped into 0-10 year
and 10-20 year time horizons.
While we do appreciate the need for some arbitrary denotation for the purposes of the
Study, we maintain that a number of factors mill dictate the timing and location of growth
in the Municipaliit and capital planning should be flexible enough to accommodate
these various scenan
UDI-Durham appreciates the opportunity to offer these comments and would be pleased
to discuss or meet further with Staff or interested Council members if so requested.
Please continue to apprise us of any further developments in this process leading up to the
proposed enactment of the by-law. =
Yours very truly,
Kelvin Whalen,
Chair, Durham Chapter
SCHEDULE 6(2t'
MUNICIPALITY OF CLARINGTON
NON-RESIDENTIAL DEVELOPMENT CHARGES
Charge Per Sq.Ft.
General Government $0.04
Library Services N/A
Fire Protection Services $0.21
Indoor Recreation N/A
Park Development and Facilities N/A
Public Works Department— $0.22
Buildings/Land/Equipment/Fleet
Roads and Related Engineering Services $1.36
Total Municipality Development Charges $1.83
SCHEDULE "1"
MUNICIPALITY OF CLARINGTON
RESIDENTIAL DEVELOPMENT CHARGES
PER DWELLING UNIT
CONTAINED IN DWELLING CLASSIFIED BY TYPE
Single* Townhouse Apartments
& Semi* /Row** /Multiples***
General Government $74.44 $64.44 $44.44
Library Services $341.80 $295.89 $204.06
Fire Protection Services $282.37 $244.44 $168.58
Indoor Recreation $2,005.91 $1,736.46 $1,197.56
Park Development and Facilities $842.53 $729.35 $503.00
Public Works Department— $366.09 $316.91 $218.56
Buildings/Land/Equipment/Fleet
Roads and Related Engineering $2,628.33 $2,275.27 $1,569.15
Services
Total Municipality Development $6,541.00 $5,663.00 $3,905.00
Charges
* Refers to Single-Detached Dwelling and Semi Detached Dwelling
** Refers to Townhouse(Rowhouse)Dwelling
*** Refers to Apartment Dwelling and Multiple Dwelling
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MUNICIPALITY OF CLARINGTON
COMPARISON OF JULY 1999 REPORT AND SPECIAL RUNS -'
RESIDENTIAL-CHARGE PER SINGLE DETACHED UNIT �
r
a
n
Charge Per Single Detached Unit
r
a �
indoor Difference Total Difference
Recreation From July Charge From July
1_ July 1999 Report $2,006 - $6,541 -
2. Specia! Run 1 -2008 Tvwin Pad $1,893 ($113) $5,428 ($113) i z
Project Removed
3. Special Run 2-2007 Recreation $1,918 ($88) $6,453 {$88)
Complex Project Removed
4. Special Run 3-2007 and 2008 $923 ($1,083) $5,4583 ($1,083)
Recreation Projects:Removed
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SPECIAL RUN 1 -NEW TWIN PAD{2008)-COURTICE REMOVED ti
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MUNICIPALITY OF C1LARINGTON
RESIDENTIAL DEVELOPMENT CHARGES
PER CAPITA AND PER UNIT
r
ca
Charge Charge By Unit Type(1) v
A Per Single Townhouse Apartments -�
Capita &Semi IRaw /Multiples
p General Government $22.22 $74.44 S64.44 $44.44
Libray Board $102.03 $341.80 $295.89 $204.96 �
Fire Department $84.29 $282.37 $244.44 $168.56 �
Indoor Recreation $564.89 $1,892.38 $1,638.18 $1,129.78 it °
11 Park Devefopment and Facilities $151.50 $842.53 $729.35 5503.00 1
I
l) Pubiic Works Department $109.28 $366.09 $315.914 $218.56
Sub-Total General Services $1,134.21 $3,799.60 $3,289.21 $2,268.42
Roads and Related $784.58 j2,628.33 $2,275.27 S1,569.15
Total Municipal Charge $1,918.79 $6,428 $5,5$4 $3,838 i 1 � H
C-j
(1) Based on Persons Per Unit Of: 3.35 2.90 2.00 H
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SPECIAL RUN 2-NEW RECREATION COMPLEX-BOWMANVILLE(2007)REMOVED
MUNICIPALITY OF CLARINGTON N
o
RESIDENTIAL DEVELOPMENT CHARGES ,y
PER CAPITA AND PER UNIT',
r
Charge Charge By Unit Type(1) „
Per Single Townhouse Apartments
Capita &Semi /Row /Multiples -�
r
General Government $2222 $74.44 $64,44 $44.44
Library Board $102.03 $341.80 $295.89 $204.06
� u
Fire Department $84.29 $282.37 $244.44 $166.58 m
e;
Indoor Recreation $572.52 $1,917.94 $1,660.31 $1,145.04 o
Park Development and Facilities $251.50 $842.53 $728.35 $503.00
Public Works Department $109.28 $356.09 $396.91 $218.56
Sub -Total General Services $1 141.84 `j3,825.16 $3,311.34 $2,203.68
Roads and Related $784.58 $2,528.33 $2,275.27 $1,569.15
ToW M, unicipa1 Charge $1,926.42 $6,453 $5,587 $3,853
9 Based on persons Per Unit Of: 3,35 2.90 2.00 c H
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