City seeks to close the gap on who pays for growth

City will receive additional dollars for the new central library, the South End Community Center

Although the cost impact of new home construction remains relatively the same as the changes to development charges take effect, it is possible that growth will pay a larger share in the near future, the Minister said. city ​​council Wednesday evening.

These potential new fees, however, will not cover the cost of the city‘s currently taxpayer-subsidized growth.

“We’re getting a bit closer,” Treasurer Tara Baker commented at a public meeting, referring to closing the gap between actual costs and the development charges collected. “We charge the full amount authorized. “

Development charges contribute to a wide range of city infrastructure costs related to policing, fire departments, sewage treatment, recreation and more. They are billed per unit for residential construction and per square meter for new non-residential construction in the city, as in other municipalities.

A few major provincial legislative changes are expected to come into effect in September which, according to Watson & Associates consultant Greg Scandlin, essentially cancel each other out.

Municipalities will no longer be allowed to charge parking services as part of their fees, but a mandatory 10% deduction for “ancillary costs” such as library services, recreation and waste diversion will be removed.

Responding to a question from Mayor Cam Guthrie, Greg Clark, the city’s director of financial strategy and long-term planning, explained that removing the mandatory deduction could result in the application of an additional $ 1, $ 7 million in development costs at the cost of the new central library. , and an additional $ 6 million goes to the South End Recreation Center.

The library project was approved last year with a budget of $ 62 million. Council approved the new recreation center and its $ 80 million price tag at that same meeting.

If the city’s proposed changes are approved, residential construction would see a net 0.3% drop in development charges, while non-residential construction would see a 4% drop, a staff report said.

Eliminating the parking service charge will reduce local CDs by approximately $ 1,316 per single-family home and $ 6.84 per square meter of non-residential construction.

However, if the proposed municipal charges are implemented, much of this lost revenue will be recouped – approximately $ 1,206 per single-family residential unit and $ 1.26 per square meter for non-residential construction.

City council is expected to formally review the bylaw changes on December 13. Wednesday’s meeting was held to gather public comment on the potential changes.

The only delegate on this was Susan Watson, who urged the council to raise every penny possible from developers to help cover the cost of growth and not pass it on to taxpayers, who pay 20 to 25 percent.

“This will have a direct impact on the property tax discussion you will have soon,” she said, referring to upcoming deliberations on the city’s 2022/2023 budget.

With housing prices rising, Watson said, “there is more than enough room for developers to absorb (the proposed fee increases)…

Responding to this idea later, Baker explained that the city was charging as much as the law currently allows. However, additional charges may soon be applied to close the gap between costs and recoveries.

The city’s park dedication bylaw, which requires developers to provide land or money instead, is currently under review. A report and recommendations to the board are expected in the third quarter of next year.

As is the case, a background study on the potential implementation of a community benefit levy is expected to begin shortly, and the findings will be presented to council around the same time as the report on the decree on the allocation of a park.

The provincial government recently approved the collection of community benefit fees for new construction.

A comprehensive development charge study is also underway as the city prepares for the province-imposed growth over the next several years. By 2051, Guelph’s population is expected to reach 203,000.

About Elaine Morales

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