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New development charges proposal moves forward

A new development charges proposal was put forward during the General Government Committee meeting on Monday night.

A new development charges proposal was put forward during the General Government Committee meeting on Monday night. Many of the recommendations go against those put forward by city staff, but the proposal will be voted on during next week's regular Council meeting. PHOTO BY LIAM BERTI

After hearing recommendations from North Bay’s development community just two weeks ago, a new version of the development charges plan has been tabled.

Chair of the General Government Committee Coun. Tanya Vrebosch presented the proposal during Monday night’s committee meeting, calling it a compromise between the city recommendations and those of the building community.

In a move largely geared towards encouraging entry-level home development, the new bylaw would see entry-level dwellings of up to 1,200 square feet be entirely exempt from development charges. 

The amendment also suggests that the current development charge rates be reduced by 40 per cent for homes between 1,200 and 1,500 square feet.

“The big thing is to maybe encourage entry-level housing,” Vrebosch said after the meeting. "We don’t ever really have a lot of tools to do that.

"Do I think this will be the end-all, be-all and we’re going to start seeing a lot of development? No. But I think this is a good tool and hopefully further down the road we can create other tools that might help that.”

Elsewhere, units equal to or greater than 1,500 square feet will be held at the current maximum rate of $9,814 for the first three years before the city phase-in the new rate of $13,732 over the remaining two years. But that final two-year phase-in will be subject to review after the first three years. 

In accordance with what the development community recommended, the new development charge bylaw would include a clause that will allow Council to review the imposed development charges after a three-year freeze to determine if the phase-in schedule thereafter will continue to remain in effect.

Vrebosch called the proposal a three-year pilot project with a review at the end. 

The bylaw would also see a deferral of payment until the homes are sold or 18 months after the home is built, lowering the barrier to entry for smaller-scale developers to be able to start construction.

Meanwhile, rates for multiples and apartments would be 40 per cent lower than their current rates for the first three years of the bylaw, with a phase-in to be reviewed for the final two years. 

The plan, which includes a total of 14 recommendations, will be voted on during next Monday’s regular Council meeting.

During the mandatory special public meeting two weeks ago, Council heard first-hand how dire the home development situation is in the North Bay area.

Representatives from the North Bay and District Home Builders’ Association, the real estate industry and independent developers expressed concern for development in North Bay being at the lowest point in the last decade. During Monday’s meeting, it was said that the updated number of housing starts this year is at 29.

During that meeting, presenters suggested the development charges be frozen at their current rate for the first three years of the bylaw with the option of reevaluating the situation for the remaining two years. Developers also urged Council to entice builders to develop entry-level housing, which seems to have gotten through.

“To me, it’s a compromise,” said Vrebosch. “I think it’s a test; you’ve got some people saying you should have zero charges, and you’ve got others saying they should be lowered.

“I say let’s try this out and we’ll give it three years; if after that it’s not working, maybe it needs to be changed,” she continued. “That’s why the wording is in there, so that we have the ability to change it if we need to.”

To read more on the development charges discussion, click here: http://www.baytoday.ca/content/news/details.asp?c=65816

With the current development charges bylaw expiring on December 15, the city is in the midst of re-evaluating how best to structure the fees so as to encourage more development in the area. If a new bylaw is not agreed upon and passed before the outgoing bylaw expires, developers will be able to develop charge-free until the new rates are instated.

The city hired a consultant to carry out a Development Charges Background Study earlier in the summer, which included 13 recommendations.

Most notably, they suggested that the current maximum charge of $9,814 be increased by up to $4,000 by the fifth and final year of the new bylaw.

Based on that study, city staff recommended that homes less than 1,200 square feet be charged 60 per cent of the current fee, while homes up to 1,500 square feet be charged 80 per cent of the current rate. Only the homes over 1,500 square feet would be subject to the maximum recalculated fee.

Vrebosch said that city staff do not support the most recent suggestions brought forward on Monday night, instead opting to endorse their original recommendations put forward over a month ago.

For more on the original Development Charges Background Study, click here: http://www.baytoday.ca/content/news/details.asp?c=65362

The principle behind development charges is growth paying for growth. As city staff argued on Monday, if development charges were removed, like they are in Sault Ste. Marie, Timmins and Thunder Bay, then the cost of growth would be levied on the general taxpayer.

It is estimated that the city currently has $2.4 million in the development charge reserve fund.

During Monday night’s committee meeting, Coun. George Maroosis questioned city staff on what their definition of growth is. He said from everything he’s seen and heard, the population forecasts are inaccurate and the outlook is trending downwards.

As a result, he said he vehemently disagrees with increasing the development charges based on the little growth that is taking place.

Elsewhere around the table, other councillors were vocal in their support for the new proposal, calling it a step in the right direction. All councillors will now have another week before their final decision is cast at next week’s regular council meeting.  


Liam Berti

About the Author: Liam Berti

Liam Berti is a University of Ottawa journalism graduate who has since worked for BayToday as the City Council and North Bay Battalion reporter.
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