Pulling back

County brings development and waterworks connection charges in line with neighbours

No longer willing to lead the region in terms of eye watering development and waterworks connection charges, the County has moved to lower these charges in hopes it will encourage builders to come back to the County.

“Your staff has responded,” Susan Turnbull, the County’s finance chief told council. “We have made a bold recommendation to invest in growth and drive our tax base.”

Specifically senior County staff have recommended a 50 per cent discount to its development charges for each of the next three years in order to stimulate new residential housing in serviced areas (with municipal water and/or sewer) and commercial building development in the County.

Staff have also recommended lower connection charges—those fees paid to hook into the County’s water and wastewater system. However this change came about more in the category of housekeeping— to reflect the shift toward fewer people living in each home (people per unit).

Turnbull also said she was committed to consulting with building developers and other stakeholders before development charges and connection charges are presented for review in 2018.

Through much of the first decade of this millennium the County saw about 130 homes built each year. Since 2008 however—through the combination of a recession and poor timing in adopting rich development charges—housing starts declined steadily. Meanwhile, neighbouring municipalities of Quinte West and Belleville managed to stabilize their housing markets after the shock of 2008. They did this in part by maintaining low development and connection charges and working closely with the builders in their community.

Even with lower charges, these municipalities have earned more development charge revenue in recent years—simply because they have encouraged more building activity. And with each new home, a stream of property taxes is added to the municipality’s overall revenue.

County staff concluded they had to change course.

Even with the 50 per cent discount, County development and connection charges are still well above those charged by Quinte West and Belleville and still in the top half of the 18 municipalities in the region.

Nevertheless Mayor Peter Mertens welcomed the recommendations as a move in the right direction.

“If we had maintained building levels where they had been prior to 2008, we would have had nearly $3 million more in revenue,” said Mertens. “This we could have used to offset tax increases and done more for our residents.”

He said too that the recommendations would help drive construction jobs, which have leaked out of the County. He said a renewed and vigorous building sector can facilitate a skills training model to promote employment among the County’s young people.

Quinte West and Belleville have kept development charges low,” said Mertens. “It has worked for them. It can work for us.”

Mayor Mertens recently returned from the Rural Ontario Muncipal Association meetings in Toronto where he said many jurisidictions in eastern Ontario see seniors’ retirement as a growth opportunity—where little else exists.

He noted that more than 100,000 people continue to arrive in the greater Toronto area each year, putting pressure on housing, infrastructure, education and health care. Mertens cited a recent Boomers magazine survey of 1,100 seniors in the GTA that found that 46 per cent plan on relocating. Mertens said the County is well positioned to attract these folks.

“One hundred and fifty homes a year could be the norm,” said Mertens. “This is an investment in our future.”

Some councillors worried that simply reducing development charges might not stimulate investment— that forgoing potential development charge revenue might be a gamble.

CAO Merlin Dewing noted that if housing starts don’t improve, the pressure to improve infrastructure and services will ease.

“We would defer capital expenditures because it wouldn’t be needed,” explained Dewing.

But most saw the move as a prudent response to the competitive market in which the County participates within the region.

Picton Councillor Bev Campbell praised the recommendations of staff but urged them to respond just as vigorously to complaints that stakeholders should be allowed to participate in the review.

“There wasn’t enough time to do a meaningful consultation,” said Campbell. “That oversight needs to be remedied.”