May 29, 2019 ERO…

May 29, 2019 ERO Number: 019-0017

Honourable Steve Clark
Minister of Municipal Affairs and Housing
17th Floor, 777 Bay Street
Toronto, ON MSG 2E5

Dear Minister Clark:

Subject: City of Hamilton Submission on Bill 108: More Homes, More Choice Act, 2019 Schedule 3

Thank you for the opportunity to provide comments on the proposed Bill 108 - More Homes, More Choices Act, 2019 (Bill 108). Please accept the following draft comments, for consideration, with respect to Schedule 3 of Bill 108.

As communicated by the Province of Ontario, the Provincial commenting period closes at 11:59pm on June 1, 2019. Given the short timeline provided to municipalities to comment on Bill 108, City of Hamilton (City) staff has assembled a letter that highlights initial requests along with concerns and pressures that have the potential to impact Hamilton taxpayers in an unfavourable fashion as well as constrain the financial sustainability of the City. The City’s final comments will be forwarded to the Province once they have been endorsed by Council in June 2019.

The Province states that:

“If passed, the proposed changes to the Development Charges Act, 1997 would:
• Support a range and mix of housing options, and boost housing supply;
• Increase the certainty of costs of development;
• Make housing more attainable by reducing costs to build certain types of homes; and
• Make other complementary amendments to implement the proposed reforms, including in relation to transitional matters.”

In some instances, the proposed changes through Schedule 3 of Bill 108 support efforts that the City has taken steps to implement such as the exemption of secondary suites.

The City provides that, if passed as written, the changes to the Development Charge Act, 1997 could also:
• increase municipal property taxes;
• increase municipal debt;
• increase municipal administration;
• increase Development Charges for the remaining services;
• reduce municipal services; and,
• if done without maintaining revenue neutrality, may slow the rate at which municipalities can afford growth.

Notwithstanding the above, the Province has not yet released regulations to clarify how the broad changes through the proposed Bill 108 would be implemented. The City’s insights are broad because these regulations have not been communicated to municipalities and the public. The City requests further consultation to provide feedback on all aspects of Bill 108; inclusive of the regulations.

The City is concerned with changes proposed by Bill 108. The changes are a significant departure from the current legislative framework and undermine an effective tool for creating vibrant communities. Reducing development charges will not make housing more affordable. Restricting cost recovery tools does not guarantee lower house prices. House prices are set by the market. The changes proposed by Bill 108 would require extensive administration and expose municipalities to collection risks.

If more municipal operating revenues are needed to cover the cost of growth, it will be at the expense of maintaining existing capital assets, levels of services, or current property tax rates. In addition, municipalities may not have the funds available to put the infrastructure in place needed for development to occur in a timely manner. Further restricting cost recovery tools is counterproductive and will increase inequities within communities. These are unintended consequences that will undermine the health and vibrancy of Ontario’s communities.

The City requests the Province to reconsider the entirety of Schedule 3 to Bill 108 under the guiding principles:
• Growth should pay for growth;
• Complete, vibrant communities are good for everyone;
• Provincial legislation related to municipal governance should be enabling and permissive; and
• Provincial red tape costs municipalities time and money.

These are the guiding principles used in the Schedule 3 comments being submitted by the Municipal Finance Officers’ Association of Ontario (MFOA). These guiding principles are supported by the City and are not upheld within the proposed changes through Schedule 3 of Bill 108.

All other comments and requests have been prepared should the proposed changes to the Development Charges Act, 1997 remain despite the previous recommendation.

The City’s draft comments and requests have been detailed in the attached list which is organized by section of the Development Charges Act, 1997. The City requests that all comments and requests be reviewed and considered by the Province.

The changes through Schedule 3 of Bill 108 are intricately entangled with the changes to Section 37 of the Planning Act, 1990 through Schedule 12 of Bill 108. The City of Hamilton is submitting comments through both commenting portals on the Environmental Registry of Ontario (ERO) website and has provided overlapping comments in this, Schedule 3, submission. In addition, the City will concurrently be submitting comments on other Schedules of Bill 108 such as Schedules 5, 9 and 11.

Thank you again for the opportunity to provide meaningful input into this review. We look forward to reviewing regulations and, ultimately, the final version of Bill 108. City of Hamilton staff would be pleased to meet with you to discuss these comments in greater detail.

Yours truly,

Mike Zegarac
General Manager, Finance and Corporate Services
Corporate Services Department

c.c. -
Nicole Auty, City Solicitor
Michael Kovacevic, City Solicitor
Steve Robichaud, Director of Planning and Chief Planner
Anita Fabac, Manager of Development Planning, Heritage and Design
Brian McMullen, Director of Financial, Planning, Administration and Policy
Cindy Mercanti, Director of Customer Service, POA and Financial Integration
Joe Spiler, Manager of Capital Budgets and Development
Lindsay Gillies, Senior Financial Analyst, Capital Budgets & Development