Development charge increase planned: Minto preparing for future growth

Minto council is considering a new development charge bylaw that would raise the charge on a single detached home by just over $1,900.

Council is expected to consider adoption of the bylaw, which also includes an increase in commercial and industrial rates at the June 2 meeting.

On May 19, Dan Wilson of Watson and Associates Economists Ltd. presented a background study on local development charges at a public meeting. Wilson noted the new rates will still leave Minto at the lower end of a comparison study of 25 other municipalities.

“Based on other municipalities in the area your charges are still relatively low,” he stated.

The report recommended moving local charges on single detached dwellings from $3,901 to $5,817. Combined with county ($2,805) and education ($1,884) levies, total development charges on a single detached residence in Minto will be $10,506. The new rates would move Minto from 21st to 19th on the list of 25 area municipalities, vaulting over Puslinch, which has a local development charge of $4,817 on a single detached home. By contrast, local charges on the same structure in Wellington North would be $15,344 and in Mapleton, under a recently-updated rate schedule, $11,785. The same county and education charges would also be added to rates in Wellington North and Mapleton. The local development charges in urban areas of North Perth are $11,534. Howick Township, which also borders Minto, does not have residential development charges.

The study proposes raising the rates for commercial and industrial development in Minto from $1.47 per square foot of gross floor area to $2.27. Mapleton recently lowered charges for these types of construction from $3.21 per square foot to $3 in urban areas and $2.61 in rural areas.

In Wellington North the rates are $5.22 per square foot for commercial and $2.62 for industrial. Neither North Perth or Howick impose development charges on commercial or industrial development.

On top of the scale among sampled municipalities for all three areas of the study was the City of Barrie, where development charges on a single family residential development are at $36,601 and charges for commercial and industrial development are, respectively, $18.24 and $14.15 per square foot of gross floor area.

Minto councillor Mary Lou Colwell asked about the reasoning behind, and impact of, North Perth’s approach of not imposing commercial and industrial charges.

“There are many different ways in which a council of any given municipality can provide relief from a development charge perspective and typically it’s usually provided in the non–residential side to try to promote non-residential growth within a municipality,” said Wilson. “I guess the more extreme way of trying to provide development charge relief is to exempt the charge entirely … that is one way in which municipalities try to remain competitive.

“You are providing some relief in terms of non-statutory exemptions. But it’s all based on trying to encourage development within a municipality – that’s the bottom line.”

Mayor George Bridge added the town has done comparison studies with North Perth which indicated Minto is still competitive due to lower charges for industrial lots and other factors.

“I feel that to get rid of all charges for industrial and commercial, it all gets put on the residential and I don’t think that’s a fair system, so I like the fact that we do kind of a hybrid,” said Bridge.

“They are obviously trying to attract new business, but  I was wondering if it’s working for them. I agree with you Mayor Bridge, it’s the whole package,” said Colwell.

Councillor Dave Turton asked if other municipalities were undergoing the same process and likely to change their rates in the near future.

Wilson explained that development charges are set for five-year terms and that about 90 per cent of other municipalities  would have seen their terms expire in 2014.

“So I would be willing to bet that most municipalities went through this process within the past year, so most of them are complete,” he stated.

Development charges are intended to cover the costs associated with growth. The study projects Minto’s population will grow from about 8,600 to about 11,750 in the next 20 years. The study projects anticipated capital needs to accommodate growth at $12.75 million, of which about $6.6 million are recoverable through development charges.