Comments from the Town of…

Comments from the Town of Halton Hills

ERO 019-0183

Proposed new regulation pertaining to the Community Benefits Authority under the Planning Act

Regulatory changes: General

1. Transition Date - January 1, 2021

This transition date will provide the municipality with just over a year to prepare and approve a Development Charges Background Study for a new or amended DC Bylaw as well as the Community Benefit Charges (CBC) Strategy to cover soft services that no longer qualify for DCs. This short time frame will put significant pressure on municipal resources and will have municipalities competing for the limited consulting services to assist them in those tasks. Also the current timeframe is further shorted due to the uncertainty/lack of regulations and complexity of developing the CBC formula.This puts municipalities at risk in their ability to properly transition to the new regime and to secure cost recoveries to the extent allowed by Bill 108.

The Town recommends a staggered transition date based on current DC bylaw expiry dates. For those DC bylaws approved prior to January, 1 2017, the recommended transition date can remain at January 1, 2021. For those DC bylaws approved between January 2, 2017 and December 31, 2017, the recommended transition date can be December 31, 2021. For DC bylaws approved between January 1, 2018 and May 2, 2019 the recommended transition date can be June 1, 2022. In this way, municipalities will have greater access to needed consulting services and an ability to plan for and absorb the costs.

2. Reporting on Community Benefits

Reporting is in line with DC reporting. Other than resources needed, the Town is not concerned with the outlined requirements.

3. Reporting on Parkland

Other than resources needed, the Town is not concerned with the outlined requirements.

4. Exemptions from Community Benefits

It is proposed that the following six types of developments be exempt from CBC: long-term care homes; retirement homes; universities/colleges; memorial homes; clubhouses or athletic grounds of the Royal Canadian Legion; hospices, and non-profit housing. This exemption represents a substantial revenue loss for the municipality, which contradicts the “revenue neutral” principle noted in ERO 019-0183 and further undermines the growth-pays-for-growth principle.

Over the years, these developments contributed funds to support soft services, which will no longer be available under the CBC regime. Combined with uncertainty around revenue for soft services, parkland and density bonusing under the CBC regime, this loss further compromises the Town’s financial capacity to implement its capital plan in support of growth. Based on the current plan, the Town requires continued cost recovery for $60 million over the 10-year forecast period along with an average annual parkland contribution of $1.3 million. As such, it is recommended that the exempt services and the level of exemption should be determined by the municipality in consideration of its Council’s priorities and affordability and that these developments continue to contribute towards the growth-related cost of soft services.

In addition, the Town recommends that non-profit housing development and institutional development included in the exempt category be further scoped, in order to promote housing affordability and to prevent CBC exemption on luxury housing/ condominiums built by an organization registered as non-profit or in the name of long-term care homes. As such, it is requested that non-profit housing exemptions be limited to affordable housing as defined by the municipality and that long-term care homes and retirement homes should be the buildings/structures subject to licensing under the Long-term Care Homes Act and the Retirement Homes Act.

5. Community Benefit Formula

The Town continues to raise concerns that long-term financial forecasting is made more complex by aligning the Community Benefits Charge with property values instead of the costs incurred from the capital infrastructure needed to support growth. Under the legislation, the calculation will be based on property values which can vary greatly depending on geographical location and proposed land use and which are very challenging to predict over the long-term planning horizon. The lack of linkage between land values as a basis for the CBC and the municipality’s growth-related infrastructure costs increases the financial risk for municipalities as revenue streams become more unpredictable and subject to changes in the real estate market. Also, the provision to allocate or spend 60 percent of funding in a given year makes it very difficult to plan for large scale multi-year projects.

Through Bill 108, the amendments to the Planning Act, the Town’s inability to charge a CBC if parkland has been collected on lands would have a financial impact on other core infrastructure such as community centres, libraries etc that are essential to supporting the development of complete communities.

In ERO 019-0183, it is proposed that a range of percentages will be prescribed to take into account varying values of land, with the formula being subject to further consultation. With respect to the formula, the Town has the following comments:

• Value of land – the regulation needs to clearly define what constitutes value of land to ensure consistency in land value appraisal.
• Periodic updates – the regulation needs to provide a periodic adjustment provision for the CBC formula, as appropriate, in order to ensure that the application of the set formula results in a charge commensurate with construction cost increases.
• Outstanding debt obligations and negative reserve balances – the CBC formula should be set in a manner to allow the municipalities to incorporate into the calculation any negative balances of DC reserve funds and outstanding debt obligations (external or internal) in relation to those services that are to be transitioned to CBC regime.
• CBC administration in two tier municipalities – the regulation needs to provide guidance as to how the CBC charge will be calculated and distributed between upper tier and lower tier municipalities.

6. Appraisals for Community Benefits

The Minister is proposing that if the owner of the land disagrees with the amount of a CBC, the owner pays the charge under protest and has 30 days to provide the municipality with her/his appraisal (1st appraisal). If the municipality disputes the owner’s appraisal, it has 45 days to provide the owner with its appraisal (2nd appraisal). If the municipality’s appraisal differs by more than 5 percent from the owner’s, a 3rd appraisal must be provided within 60 days from an appraiser that is selected by the owner from the municipal list of appraisers.

The Town is concerned that the aggregate cost of obtaining land appraisals could be a substantial amount and an on-going financial burden to the municipality. As such, it is recommended that all land appraisal costs required for an initial CBC calculation and for any subsequent CBC reviews requested by the owner should be borne by the owner. Furthermore, the regulation needs to confirm that the third appraisal should be the final appraisal and that the owner should pay any increase in the CBC as a result of the third appraisal within a fixed timeframe (e.g. 15 business days).

7. Excluded Services for Community Benefits

The proposed excluded services are the same as those that were excluded from DC collections. No further comments.

8. Community planning permit system

The Town does not utilize a community planning permit system and therefore does not expect any impact. No further comments.