AMO’s Submission to Proposed…

AMO’s Submission to Proposed Planning Act and Development Charges Act, 1997 Changes: Providing Greater Cost Certainty for Municipal Development-related Charges
AMO Submission to the Ministry of Municipal Affairs and Housing on:

ERO 019-6172

December 9, 2022

 
Preamble
The Association of Municipalities of Ontario (AMO) is a non-profit, non-partisan association that represents municipal governments across Ontario. Together with our members, we address common challenges facing our residents and provide advice to the government about solutions to them. AMO has been actively involved in housing and homelessness advocacy for years, as Ontario’s 444 municipal governments are responsible for building strong, complete communities, of which housing – both home ownership and rentals – is a key component.

Housing affordability and building supply is a challenge all Ontarians share. There is much that can be done collectively by working together to increase housing supply, diversify the mix and increase affordability. Solving the housing crisis will require an all-of-government approach by all three orders of government and the development industry.

Introduction
AMO appreciates the opportunity to provide comments on several consultations related to Bill 23 – More Homes Built Faster Act, 2022. These are in addition to the written submission to Bill 23 AMO provided to the Standing Committee on Heritage, Infrastructure and Cultural Policy.

Despite the Bill’s passage on November 28, municipal governments remain concerned that the legislation:

1. Shifts the cost burden of growth
2. Undermines planning and community livability
3. Exacerbates risks to the environment and human health

On November 30 AMO was pleased to see the government’s response to AMO’s preliminary analysis of the Bill which indicated a need for a transfer of up to $1 billion a year in costs from private sector developers to property taxpayers without any likelihood of improved housing affordability. Our focus will now shift towards making sure the housing pledges and targets are feasible and reasonable given historical data. To tie funding to unreachable targets and narrowly-defined “housing enabling infrastructure” are details we look forward to discussing more.

In the meantime, AMO is asking the province to work with all of its housing partners to take an integrated approach to environmental, social and economic policy that allows Ontario to take its place ahead of competing jurisdictions.

To that end, AMO respectfully submits comments on various consultations related to Bill 23 and the More Homes Built Faster Plan.

 
Proposed Planning Act and Development Charges Act Changes: Providing Greater Cost Certainty for Municipal Development-related Charges (ERO 019-6172)

Development charges are designed to help municipalities pay for a portion of the capital infrastructure required to support new growth. Premised on the widely accepted principle that growth should pay for growth, development charges help to ensure that existing taxpayers are not required to subsidize costs of the infrastructure or services needed to support new residents and businesses.

The Housing Supply Action Plan sets the ambitious target of building 1.5 million homes by 2031, with 1.23 million in Ontario’s 29 largest communities. AMO’s preliminary analysis estimated that development charges in these communities would drop by at least $5.1 billion – or $569 million per year in today’s dollars.

Since AMO estimated these shortfalls, we have received additional information from some members that suggests a more significant impact on the sector from Bill 23. Increased estimates for impacts on housing services and land cost ineligibility as well as new estimates regarding phasing suggest that the impact is likely over $10 billion over ten years or over $1 billion per year.

AMO appreciates the recent letter from the Minister of Municipal Affairs and Housing that commits to “ensuring that municipalities are kept whole for any impact to their ability to fund housing enabling infrastructure because of Bill 23.” By way of this letter, AMO believes government recognizes the importance for municipal access to funding to support the joint provincial-municipal goal of increasing housing supply and affordability and looks forward to more information regarding this commitment as it becomes available.

Given that the changes to development charges have not yet been proclaimed, AMO recommends that the government pause on implementation of Schedule 3 of Bill 23 until it has completed the targeted audits committed in their recent letter and/or consider amendments to the development charge framework that support housing-enabling infrastructure as a part of future iterations of their ongoing housing action supply work.

For more specific AMO positions on municipal finances, please read AMO’s Submission on Bill 23, and the letter to the Minister of Finance on November 1.
Conclusion

On behalf of municipal governments across Ontario, thank you for your consideration of the comments provided in this submission.