DC charges may rise for residential development but drop for commercial development

Centre Wellington is hoping to approve a revised development charges bylaw later this month.

On July 25, Gary Scandlan of Watson and Associates presented councillors with updated information on the township development charges study and bylaw.

Centre Wellington’s director of corporate services Dan Wilson said the township is working with Watson and Associates in the update.

Wilson explained the existing bylaw, put in place in October 2013, has a five-year term expiring in October.

Originally, the intent was to have the work finalized in June meeting, but the process was extended following feedback on proposed rates at a May 22 public meeting.

Developers/builders and residents expressed concern over proposed rates and specific developments.

In addition, Wilson said new information was received as a result of the township’s update on its water supply master plan.

Wilson said that instead of passing the bylaw immediately, council should consider the presentation an information update with the intent of passing the revised development charges study and bylaw in late July.

He said a second public meeting would be held prior to the council meeting as there had been significant changes since the May public meeting. Based on results from the first public meeting and subsequent comments and submissions, the calculations were further refined for: fire protection services, roads, water distribution  and wastewater collection services

Scandlan said one project was missed – a capital project for High Street, from McNab Street to York Street (Elora) allowing for an additional net DC eligible amount of $245,000 to be included in the calculations.

He noted that upon further review by staff, debt related to the Fergus Fire Hall renovation and expansion has been removed from the calculations as the balance was fully paid out of the DC reserve fund. This results in a reduction in the net DC eligible amount by $180,696.

Scandlan said initial calulations looked at remaining capacity within existing wells. However at that time AECOM was finishing off its calculations regarding water capacity as part of the township’s water master plan.

Based on that analyses, it was determined the excess capacity within existing wells was much less than previously estimated and hence, 54% of the cost of additional water supply is required to service the growth to 2031.

This refinement results in an increase in the DC eligible amount by $3.32 million.

As a result of the changes, Scandlan offered proposed DC charges as follows:

– residential – single/semi detached: $20,102 to $21,914.

– non-residential: $7.37/square foot to $6.01/sq. ft.

Mayor Kelly Linton explained no recommendation was being placed before council at the meeting and that the second public meeting is set for July 23.

Councillor Stephen Kitras found aspects of the calculations confusing when water calculations went down, when it was confirmed that Centre Wellington will need a new well.

Kitras said the township must pay for a new well and it appears that residents will be picking up the cost, not non-residential properties.

He said that while there is very little employment land, there is a conference centre/hotel development which will use water, possibly a new grocery store which will need water.

Kitras said this municipality is growing, a new well is needed, and non-residential development charges regarding water are going down – even though the projected non-residential development is expected to surpass 2013 estimates.

“It seems they should be paying a greater portion,” he said.

Scandlan said he would return to council with additional information.

Councillor Fred Morris said residential DC charges are applied to new residential buildings and the costs passed on to the purchaser.

Yet the projected non-residential charges are dropping.

“The optics, at least on the surface, seem that residential homebuyers will be picking up the slack for non-residential development,” he said.

Scandlan said calculations are based on a number of formulas and factors which need to be considered.

If there is more square footage per employee for commercial use, the DC charge would decrease as less water would be needed even though if building size is larger.

Kitras then queried whethe Scandlan had details on hotel/restaurant usage since they are different types of commercial businesses.

The matter is currently set to be discussed later this month.