May 27, 2019 Corporate…

May 27, 2019
Corporate Services - Legislative Services
The City of Waterloo

The Honourable Doug Ford
Premier of Ontario
Legislative Building, Queen's Park Toronto , ON M7A 1A1

RE: Bill 108, More Homes, More Choice Act, 2019 - Impact on Development Charges and the Land Use Planning System

Dear Premier Ford:

Please be advised that the Council of The Corporation of the City of Waterloo at its meeting held on Monday, May 27 , 2019, approved the following motion:

1. That CORP2019-043 and IPPW2019-043 be approved.

2. That Council supports the Province's goals of improving access to different types of
housing, including more affordable housing, but strongly disagrees that Bill 108 in its current form will achieve them

3. That Council is concerned that Bill 108 in its current form could put at risk our city 's finances and ability to provide parkland and community facilities , including the East Side Library.

4. That Council is opposed to the return of the old OMB rules for planning appeals as it once again takes decisions out of the hands of municipal Councils and is concerned that the new timelines for planning decisions will make it difficult to adequately engage the public and resolve issues collaboratively , and avoid a lengthy and costly appeal process.

5. That Council request that the Province extend the deadline for comments on Bill 108 from June 1 to September 30 and make any proposed regulations associated with Bill 108 available well in advance of the new deadline to allow municipalities adequate time for comment.

6. That CORP2019-043 and IPPW2019-043 , along with any additional comments that may be deemed appropriate by the City's Chief Financial Officer and Treasurer, the City Planner, and/or the City Solicitor , be forwarded to the Province of Ontario as the City of Waterloo 's preliminary comments in relation to Bill 108.

The following is an executive summary from CORP2019-043: Bill 108 More Homes, More Choice Act, 2019 – Impact on Development Charges:

A. Executive Summary:

On May 2, 2019 Bill 108, More Homes, More Choice Act, 2019 was introduced as part of the Provincial government’s Housing Supply Action Plan. The proposed legislation received first reading on May 2, 2019 and the opportunity to provide comments remains open until June 1, 2019. There are 13 Acts affected by Bill 108. This report represents the City of Waterloo’s comments on Bill 108 specifically as it relates to proposed changes to the Development Charges Act, 1997 (DCA). The regulation has not been made public. Without the regulation, the Bill on its own does not provide enough details for municipalities, associations, consultants, and industry to adequately understand the impacts of the proposed legislation. However, in the absence of a regulation, staff have extensively reviewed the Bill in consultation with other cities, associations and consultants and are providing comments for Council’s consideration for submission to the Province no later than June 1, 2019.

The most significant impacts to the DCA that the City of Waterloo is facing are:

• Removal of Soft Services: Parks, Indoor Recreation, Libraries, Parking, Cemeteries and Studies associated with these soft services are to be removed from the DCA. These will be considered under a new Community Benefit Charge by-law if the City wishes to impose one.

• Community Benefit Charge (CBC) to allow municipalities to charge up to a cap (yet to be prescribed) directly for soft services, some parkland dedication, and replace the current Section 37 density bonusing provision in the Planning Act. This could have significant funding implications for municipalities.

• Timing of determining DC Rates for remaining eligible DC services will shift from the current process of DC rate in effect at building permit issuance to an earlier date which is likely to result in reduced DC revenue.

• Cash flow will be adjusted for rental housing, institutional, industrial, commercial and non-profit housing such that DCs would be paid in six equal annual installments beginning with the date of issuance of an occupancy permit or occupancy of the building, whichever is earlier. This could impact the City’s ability to move forward with some projects without taking reserves into the negative or issuing debt. This will also impose and administrative burden to track payments of six installments for every eligible development.

• Exemption for secondary dwelling units in new residential buildings from development charges.

• Transition: a development charge by-law that would expire on or after May 2, 2019 (as is the Case with the City of Waterloo’s current by-law) and before the prescribed date shall remain in force until the earlier of,
o the day it is repealed;
o the day the municipality passes a Community Benefit Charge by-law under the Planning Act as
re-enacted by the More Homes, More Choice Act, 2019; and
o the prescribed date.
This transition period is further complicated by the fact that once a Community Benefit Charge by-law is passed, parkland dedication as currently collected is no longer in force.

B. Financial Implications:

Should Bill 108 be approved, resources will be required to implement the legislation. Significant implementation items would include the preparation of a Community Benefits Charge Strategy and by-law as well as amendments to the City’s Capital Budget. The City’s Development Charge by-law would also need to be updated along with the creation of a Community Benefits Charge by-law, should the City wish to pass a CBC prior to the existing DC by-law expiring. This would require additional resources and funding as well.

Moreover, there could be significant financial implications as a result of the changes to soft services and of proposed timing of DC rates and cash flow. These could result in reduced capital programs for parks, libraries, indoor recreation, parking, cemeteries and studies, or put pressure on the general tax base, user rates, or some combination thereof.

*** FULL DETAILS AND IMPACT, ALONG WITH STAFF COMMENTS, CAN BE FOUND IN THE CITY OF WATERLOO COUNCIL REPORT, CORP2019-043, ATTACHED IN THE SUPPORTING DOCUMENTS SECTION ***