Photo By: Troy Mortier from Unsplash
St. Catharines City Council has approved the re-introduction of municipal development charges to help cover infrastructure costs related to new building projects that would otherwise be covered by taxpayers.
After over a year’s worth of public engagement with the community and stakeholders, council approved a development charges background study and bylaw at last week’s meeting. This vote allows for the development charge bylaw to come into effect Jan. 1, 2022.
Development charges are fees imposed on land development and redevelopment projects to help pay for the cost of infrastructure required to provide municipal services to new development, such as roads, transit, water and sewer infrastructure, fire services infrastructure, park amenities and community centres. The City of St. Catharines had some development charges in place from 1991 until 2009, when they were removed to encourage building at a time when there was slow growth.
St. Catharines is currently the only municipality in the Niagara Region that does not presently collect municipal development charges. For 12 years, this put the city at a competitive advantage and encouraged growth and interest in the community.
However, with a lot of development now taking place, the situation has changed. St. Catharines is forecast to grow by another 5,440 residential units over the next 10 years and 12,900 units over 20 years. There’s also anticipated growth for non-residential buildings to cover an estimated three million square feet of space in the next 10 years and more than seven million square feet in 20 years. It’s expected the city will incur about $200 million in capital costs due to all that growth over the next few decades.
While the revenue will depend on development levels, the consultants hired to conduct the background study have indicated that the city could potentially collect millions of dollars in development charges on an annual basis under the new bylaw.
“Years ago, the City of St. Catharines made a decision to attract investment and redevelopment and now, the time has come for council to make another smart decision that better reflects the current state of investment attraction in St. Catharines,” said St. Catharines Mayor Walter Sendzik. “This is a fair, balanced approach that will ensure that the costs of new development do not fall to the taxpayer and that growth will pay for growth in the future. Development charges will better position the city to invest in infrastructure and public realm improvements that benefit everyone.”
Once charges come into effect, they will be lower than many municipal comparators and opportunities will exist for exemptions and grant programs to support projects, such as affordable housing, employment creation and development in the urban core. This proposed bylaw and planned grant program should do much to make growth more sustainable in the city going forward.
“Reinstating development charges is part of the city’s commitment towards better fiscal responsibility, stability and sustainability,” said Tami Kitay, Director of Planning and Building Services in St. Catharines. “This transformational shift will assist with capital budget forecasting and financing, strategic decision making, and investment back into the community.”