Comment on the Proposed…

Comment on the Proposed Planning Act and Development Charges Act, 1997 Changes: Providing Greater Cost Certainty for Municipal Development-related Charges

ERO: 019-6163

Dec 1, 2022

Parks and Recreation Ontario

Introduction

Parks and Recreation Ontario (PRO) is a non-profit association with over 6000 members that deliver services to more than 85% of Ontario’s population. We are devoted to advancing equitable access to quality parks and recreation services. PRO champions the health, social, and environmental benefits of parks and recreation through advocacy and cross-sectoral partnerships. Our work includes policy and research, professional development, and our flagship quality standards program, HIGH FIVE®.

Following the announcement of Bill 23, PRO has conducted stakeholder consultations with several of our municipal members in order to create a written submission with key considerations and recommendations. Through these consultations, we learned that many aspects of Bill 23 will impact municipalities and their ability to provide parks and recreation services.

Specifically, PRO is concerned about changes to the Development Charges Act, 1997, that will result in a reduction of key revenue streams and leave municipalities struggling to support growth in their communities. These amendments undermine municipal governance and consistently shift the cost of growth onto local governments and taxpayers. The two key provisions of particular concern to PRO members are discussed in detail below.

Exemptions from Development and Community Benefit Charges

Recommendation: PRO recommends a reconsideration of Schedule 3, section 4 concerning the exemptions made for affordable and attainable housing, non-profit housing developments, and inclusionary zoning residential units. Implementing reduced development and community benefit charges would still encourage the creation of these types of units while supporting local governments and shifting less financial burden on to taxpayers.

While PRO understands the intent behind exempting affordable and attainable residential units, non-profit housing developments, and inclusionary zoning residential units from development and community benefit charges, this type of differentiation could result in deeply divided communities. Neighbourhoods with attainable and affordable housing are at risk of being under resourced. Without additional revenue or changes to the proposed legislation, local governments will be unable to fund critical parks and recreation projects that would serve growing communities and equity-deserving groups where recreational service and parkland gaps have long been identified. This stands to challenge equitable access to parks and recreation services.

While Bill 23 will attempt to build 1.23 million in Ontario’s 29 largest communities by 2031, The Association of Municipalities Ontario (AMO) estimates development charges will reduce by 5.1 billion (569 million per year) over the same time period in these communities 1. Unless local governments use alternative fees to raise revenue, such as increased property taxes, this will result in a drop in service provision and fewer amenities for all residents. This lack of revenue will mean municipalities will be responsible for providing services to a greater number of residents with fewer dollars per capita to make them happen.

Shifting the financial burden of growth in this way would only feed into Ontario’s affordability crisis rather than dampen it. As AMO points out in their submission to the Standing Committee, Bill 23 will also remove the ability for municipalities to include housing services in their development charge fees; fees that raised almost $150 million dollars for housing services in Ontario between 2015 and 2019 2. This will prevent municipalities from attending to homelessness, and ultimately contradict the Ontario government's goal of improving housing access to the most vulnerable members of society.

According to the city of Toronto, “over 40% of growth-related project costs are already being subsidized by property taxes and user fees and the proposed changes will further exacerbate the challenges with delivering the growth-related services needed” 3. Development and community benefit charges are used to create holistic communities designed not only to house people but to also be places for work and play. The City of Toronto’s Comments on Bill 23 lists several projects that would be at risk of postponement and cancellation due to the loss of development charges funding, including Community Centres, Arenas, Pools, Outdoor Recreational Centres and Park Development, which were previously planned to receive $1.5 Billion in development charges funding.

Community Benefit Charges

Recommendation: In consultation with municipal stakeholders, PRO recommends the repeal of Section 5 of Schedule 3 which would allow municipalities greater flexibility in the planning and approvals process.

The proposed amendments to the Development Charges Act also place limits on how local governments can raise revenue from community benefit charges (CBCs). Under Bill 23, the maximum CBC payable would be based only on the land proposed for new development, not the entire parcel of land that may have existing developments on it. CBCs are a relatively new tool that can help municipalities fund capital costs related to the provision of public services. This further deepens the challenges local governments will face in raising revenues for service provision and result in the postponement or cancellation of many projects that create quality communities. Again, those most disproportionately impacted will be high-density housing, where many people will live without services such as parks, recreation and community centres.

Changes made to the process for determining development charges detailed in section 5 of Schedule 3 create barriers for municipalities to meaningfully engage in the development process. Making the costs of certain studies ineligible for coverage under a development charge shifts the onus to local governments burdening already strained budgets.

Conclusion

PRO appreciates the opportunity to address these specific concerns related to the proposed amendments to the Development Charges Act, 1997. PRO has focused the comments on strengthening the proposed regulation in order to ensure vital community infrastructure and services are maintained. There continues to be concern among stakeholders that Bill 23 as it is written will undermine the ability of municipalities to build healthy, vibrant communities and will ultimately be a detriment to Ontarians.

PRO looks forward to working with the province to ensure municipal parks and recreation service providers are included in the Bill 23 consultation and implementation process.