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Development charges discussed at special meeting

- the current DC Bylaw amendments expire in August -


Last Wednesday evening, Gary Scandlan, of Watson & Associates Economists LTD., provided members of Essex Council and Administration with information regarding development charges during a special meeting held in the large meeting room at the Essex Municipal Building.

by Sylene Argent

Last Tuesday, Essex Council held a special meeting to get background information about development charges.

  Gary Scandlan, of Watson & Associates Economists LTD., provided Council with a plethora of information regarding development charges, and provided information on how the Town compares to area municipalities in this regard. He also provided updates on changes implemented to the Development Charges Act in 2015.

  Development charges recover the capital costs associated with residential and non-residential growth within a municipality, Scandlan noted during the meeting. These costs are in addition to construction, and include items like internal roads of a subdivision, sewers, watermains, sidewalks, and streetlights. The idea of development charges is to service new growth in the municipality so taxpayers are not on the hook.

  Municipalities can make these charges through the Development Charges Act.  

  A future meeting will highlight how the Town’s Development Charges Bylaw has been performing since amendments have been adopted.

  Currently, Development Charges have been removed in Ward 4 to spur growth.

  In 2015, a previous term of Council provided for a fifty percent reduction in residential Development Charges for Harrow. This Bylaw expired on December 28, 2016 and was further extended to December 31, 2017. At that time, the amendment to the bylaw that enforces the imposition of Development Charges for the Town was enacted to provide a 100-percent discount for Development Charges on residential development in Harrow between January 1, 2018 and August 25, 2019

  This amendment to the Bylaw was implemented to help attract residential growth in Harrow during a time the high school was still being considered for closure. During the meeting, Mayor Larry Snively commented the Town still struggles to get new development in the south-end of the municipality, but the north-end is growing.

  Further, in May of 2018, the Council of the day adopted an amendment to Bylaw 1344 that imposes Development Charges. The amendment reduced commercial development charges by 100 percent in areas that fall outside of the Town’s existing Community Improvement Plan boundaries. The changes are also in effect until August 25, 2019.

   The 100 percent reduction in commercial Development Charges is funded through the new tax revenue or incremental commercial property tax revenue from each applicable development, based on a calculated payback period.

  Reduction in development charges must be funded from other sources.

  As these amendments to the Development Charges Bylaw expire in August, the background session was held so Council can consider these amendments.

  Further, in March of this year, Council approved using an increment tax increase to fund multiple-residential development charges. This model, depending of the situation, could leave the Town with no tax revenue from the facility once it is built for a few years as the development fees waived have to be paid back.

  Development Charge amendments also have to consider a waste-water portion.

During the meeting, Scandlan went through what can be included through the Development Charges Act and what can not, which gave members of Council and administration a clear understanding of what is permissible and what is not.

He said it is important Essex’s Development Charges program is clear as to what will be impacted through this program. He noted part of the clarity is to ensure the section of the Municipal Act, regarding “bonusing” is not affected. If the municipality charges one new development, other similar new developments must be affected as well, for fairness.

  Scandlan said a Development Charges background Study will be released in, around, June on the issue, which will be followed up with a public meeting in July. Council could then consider the bylaw by August.

  During the meeting, CAO Chris Nepszy said he wants a bylaw that works for the Town of Essex and is consistent.

Council received Scandlan’s report. 

© 2020 The Essex Free Press ltd.

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