Ministry of Municipal…

Ministry of Municipal Affairs and Housing
777 Bay Street
College Park 13th Floor
Toronto, ON
M7A 2J3
Canada

April 20, 2020

Attn: John Ballantine, Manager, Municipal Finance Policy Branch

Dear Sir,

RE: Letter of Opposition to Community Benefit Charge Regulations

I am a landowner in Bowmanville (Clarington) and, are further part of a group that consists of several landowners with holdings in the Soper Springs/Hills Secondary Plan Area. This letter expresses opposition to the adoption of the proposed regulations associated with the new Community Benefit Charge (CBC).

It is my understanding that, pursuant to June 2019 and the introduction of Bill 108, the new CBC was created to allow municipalities to impose a charge to pay for capital costs of facilities, services or matters due to development and redevelopment. The adjustment of eligibility of services to parks and other services and facilities items creates an overall increase as further described below. The movement of services from the collection and eligibility between and from Development Charges (DC) to CBC creates a cause for concern given its potential impacts to the land development costs and therefore how such costs would impact housing costs and affordability generally in communities throughout Ontario.

As a landowner and developer within Clarington, I have over 90 acres of land at 3253 Liberty Street N. I understand that the introduction of the CBC and its intention, in the form of the regulations presented for comment and review, would bring about changes to DC. As the CBC introduces the removal of 10% statutory deduction for soft services and causes some services to no longer be eligible for DC recovery, this will result in an increase to DCs for most municipalities, including Clarington.

At this time, neither Bill 108 nor the regulation proposal, provides for a methodology or imposes any explicit rules on the calculation of the CBC, which give cause for some concern as to the application of the methodology and the impact it may have in certain municipalities.

At this time there is a lack of clarity around the preferred methodology of the intended CBC calculations. In the absence of said methodology, it is appropriate to have stakeholder participation, through additional reviews and evaluations of such methodology, as well as supplementary guidance from industry experts.

According to analysis completed by professionals in the development industry, it is our understanding that based on preliminary calculations, the expected increase to development fees and levies within Clarington for low-density and high-density development, is significant and is disproportionately impactful to low-rise built form typologies in comparison with higher density built form typologies. Based on some information we are aware of impacts for a single detached unit could be an increase between $20,000 and $30,000 per unit, which has a great impact on development costs for housing in Clarington and in our opinion, impact affordability considerations generally in relation to the housing market.

These inconsistencies and significant potential increases in costs to the delivery of housing to the market give great cause for concern as the inequity between low density and high-density housing types impact market areas where predominate forms of housing are lower density as is the case in Clarington.

The initial change to the CBC was to have the intended revisions be revenue neutral and we believe the intent was not to generate an additional cost burden to development and accordingly housing affordability. The above concerns represent a departure from revenue neutrality, and in our opinion the regulations requires modifications to align with the initial intent of the CBC approach.

At this time, we are opposed to the CBC regulations in the form presented and recommend that the Province consult with industry professionals and the development, and homebuilders associations to have the proposed regulations modified and adjusted to better address the concerns herein and those from other industry representatives.

If you have any questions or comments, please do not hesitate to contact the undersigned.

Yours Truly,

Albert Soberano
Director, Sharno Holdings Inc. (member of the Soper Springs/Hills landowners group)