Development charges bylaw means more costs for local lots

Well­ing­ton North’s new development charges will be coming into effect in the future – and as expected it won’t be a popular decision with developers.

Councillors were quite aware the decision would not be popular.

Over the next five years, charges on single rural residential developments will rise from $5,040 to $7,381. In urban areas those costs jump from $14,402 to $21,090. Cur­rently development charges for single family dwel­­lings there are roughly $6,000.

A copy of the bylaw outlining the charges for different resi­dential and non-residential charges is posted on the township’s website.

“It was not an easy decision to pass this,” Mayor Mike Broomhead said, adding council tried to project costs over the next five years. “In all fairness, we need to deal with this.”

He said the process had been de­layed a number of times, and then eight weeks ago council announced a decision would be made by now.

“We hope this a good decision even though we realize it will not be popular,” the mayor said.

Broomhead added room for future debate stating that the township could review the charges, if it finds they are not working. But he explained there are only three ways to get funding needed for projects related to future development.

If the funds are not raised through development charges, Broomhead said they must either come through water and sewer rates or through property taxes.

Broomhead said residents do not want to see the added costs on their tax bill, and no one wants to see higher water and sewer rates. “What we are doing is what believe is the fairest approach,” he said, noting, “This was not one person’s decision.” All five councillors agreed on the changes.

Councillor Dan Yake reiterated those comments.

“This is one of the most difficult decisions in my 15 years on council,” Yake said. “It may not be popular, but overall it is a good decision.”

In the audience were four members representing the developers. None appeared happy. Council also received two written sets of comments on how developers believed the changes would affect development in the southern end of the municipality.

Arnold De Boer, Carson Reid Homes Ltd., and Pinestone Homes Ltd. wrote, “We have purchased 39 lots in the East­ridge subdivision in Arthur and we would like to express our concern over the proposed de­velopment charges increase.

“Having built thousands of homes in Guelph, Kitchener, Cambridge and Centre Well­ing­ton, we have a thorough un­derstanding for the need of development charges and re­views of the charges.

“It is with utmost concern in this instance, when we are faced with charges proposed, that are such a large percentage of the overall value of the lot and in essence the price of a home. When you have a price sensitive area with lot values of $35,000 to $55,000, and you are talking about increases of $6,000 development charges to $15,000 development charges.”

De Boer wrote only four years ago those charges hovered around $1,000.

“These increases, combined with a softening new home market and the fact that rural areas and small towns are usually the first and hardest hit by a market correction, could lead to a lack of development and stagnant growth,” De Boer stated.

Dave Martin and James Coffey, who are involved with the Eastridge development, also wrote to council to express their disappointment.

“We feel that the proposed increase will have a significant impact on new home activity in our township, and at a time when new home sales appear to be softening, the implementation of this bylaw could not come at a worse time,” Martin and Coffey said in the letter.

“On April 27, 2007 we as de­velopers in Eastridge Land­ing signed the subdivision agreement with the township of Wellington North, and at the time were not made aware of any proposed drastic increases in development charges. We proceeded with development of the land, and as a result lot prices and new home prices were set prior to these proposed charges becoming effective.

“We are asking for your consideration in waiving the proposed increase in fees for Lots 1 to 39, Eastridge subdivision in Arthur. We realize for future phases of this subdivision that the development charges in place at the time of approval, will be charges that are applicable.”

Council did not waive the fees. It simply received the letter for information and made no comments on it.