Fantasy

Council presented with Wellington specific development charge

At last Thursday’s Committee of the Whole Meeting, Andrew Grunda, an economist at Watson and Associates, presented a plan to council regarding setting an area-specific development charge to Wellington, that would encompass all future growth. Currently, the County recovers the growth-related capital costs for water and wastewater services through a connection charge imposed County-wide under the authority of the Municipal Act. The plan would see a premium charged to Wellington, to help offset the costs associated with a new water and wastewater plant, as well as upgraded services throughout the village.

HOW WE GOT HERE
For several months now, engineering consultants have been busy imagining Wellington in the future. A future in which the village population is four times larger than it is today. And, it is expensive. The price tag is currently set at $96 million—even before a shovel is in the ground.

Wellington has bounced between 1,500 and 2,000 residents for over 100 years. The current pressure on the population is downward. Yet the County is making plans for a future which will welcome over 8,500 residents.

Earlier this year, RVA, an engineering consultancy, unveiled its recommendations for Wellington’s waterworks, imagining a buildout to this future population. They recommend a new waste water plant ($27.7 million) including a new sanitary trunk ($5.5 million), and a new water treatment plant ($37 million), water tower ($15.8 million) and watermain trunk ($10.3 million). Bear in mind that the village’s current plants and source pipe are in good shape, work well and are significantly underutilized— that is, that each has much more capacity than is currently used. The engineers explain, however, that tying new and old plants together will increase the overall cost and perhaps diminish reliability. Finally, there are a series of stormwater management projects recommended around the village (totalling $12.5 million).

The consultants suggest the bulk of these costs might be borne by developers to be passed along to new homeowners, whom this shiny new capacity is intended to accommodate. Yet it is entirely unclear that there will ever be 8,500 residents in Wellington.

Through the 2017 Water and Wastewater Ad Hoc Committee and 2018 Development Charges Background Study process, it has been the County’s intention that water and wastewater services would be incorporated into one development charge in the update. The County’s current connection and development charges for a single detached home—roughly $18,000—are already higher than all of its neighbours including Belleville, Quinte West and Brighton. The new charges would see the fee jump to nearly $30,000 per residential unit. Non-residential development charges would see an increase from $5.53 per square foot, to $35.95 per square foot.

Councillor Mike Harper was concerned about the high costs, especially those of the commercial. Grunda explained that the servicing costs need to be made up at some point. “Affordability concerns are something that council concerns themselves with, but that should be taken into consideration that any funding shortfall needs to be made up by existing ratepayers,” said Grunda.

To make matter worse, and to try and put council’s minds at ease, Watson has gone as far as to compare the County’s new charges to other municipalities that aren’t direct competitors in the market. Places such as Scugog, Cobourg East and Cavan Monaghan. Even after doing this, the County’s new Wellington-specific charges are among the highest of the bunch, with industrial charges slipping directly into that top spot.

A local builder told the Times that the number of projected residents and homes are a fantasy. In comparison, for the past decade, Wellington has averaged roughly 45 new builds a year. “Building permits are already on a downward track. It is not realistic to expect to see a 300 per cent increase in permits each year,” he said. The builder also pointed out that the majority of development in the last decade—along with the development and connection charges—have been in Wellington. He feels that this is the County taking advantage of a hot market, and making Wellington builders and developers pay more than their fair share.

Councillor Janice Maynard asked if there might be an area-specific water rate charge as well in the future. CAO Marcia Wallace acknowledged there had been talks of just that, but there hadn’t been a decision made yet. “We are going to bring something back to council in terms of some options on the way to deal with our rate study this year. We have asked Watson to look at a number of different scenarios, including an area-specific approach so we can compare that against a County-wide approach. We are also looking at trying to make more of our development follow a more DC-like model,” said Wallace. “Council has agreed to some of the development from your position on the planning committee. We are trying to find a way to service that development. It always had an element that would have to be carried by the County. How we pay for that is certainly another conversation. We are trying to move as expeditiously as possible to get to an upfront servicing agreement so this housing can get built.”

There are several subdivisions in the works that imagine as many as 1,200 new homes in the village. Yet most of these plans have been kicking around for more than a decade, with little movement. Even if all of them were to proceed, there is no evidentiary basis to believe the pace of development would happen quickly enough to justify this massive expenditure.

The next steps for this plan are to receive feedback from council and have further discussion with landowners on potential development charge funding agreements, with a hope to finalize the plan in February or March of 2021.