I want to share my concerns…

I want to share my concerns regarding Bill 23, and the “Proposed Planning Act and Development Charges Act, 1997 Changes: Providing Greater Cost Certainty for Municipal Development-related Charges”

Developers are not facing any cost uncertainty, they know what the Development Charges currently are. These measures will instead bring a great deal of revenue uncertainty to municipalities and their residents and taxpayers, as municipal revenues will be significantly impacted.

The Niagara Region has calculated that it will lose over $37million in the first 5 years of this legislation, significantly negatively affecting its capacity to provide affordable housing. An estimated increase of 11% in property tax yearly is not something that could be deemed as affordable.

There is no reason to think that any home builder or developer will pass the savings in reduced development fees on to home buyers. They will instead charge the market rate to home buyers and pocket the difference. These steps do not follow the recommendations of the the Housing Affordability Task Force Report, which recommended the establishment of an “Ontario Housing Delivery Fund” to incentivize municipalities to build more homes (p24).

The Housing Affordability Task Force also wrote that “a shortage of land isn’t the cause of the [housing shortage]. Land is available, both inside the existing built-up areas and on undeveloped land outside greenbelts.” (p10)

The Task Force also recommended that “the province should consider partial grants to subsidize municipalities that waive development charges for affordable housing and for purpose-built rental.”(p24) This legislation fails to do this.

Reducing Development Charges will make a bad situation worse as DCs do not currently cover the costs of developments. This is something that the Housing Affordability Task Force acknowledges when it writes, “most municipalities report that development charges are still not enough to fully cover the costs of building new infrastructure and retrofitting existing infrastructure in neighbourhoods that are intensifying.” (p22)

To summarize, reducing and eliminating Development Charges without replacing that funding will only bring revenue uncertainty to municipalities and their residents, as it passes costs from developers to taxpayers (or, takes money from residents and gives it to developers).