Wellington North Council’s ongoing development charge controversy has led to additional issues, including one where money could be saved according to a proposal from an outside consultant.
A further request for how Wellington North council is going to deal with $229,476 handed out in payment deferrals and rebates as part of the township’s ongoing development charge debacle was addressed by a township lawyer Monday evening.
Lawyer Robert Mullin, of Smith Valeriote, was brought in by council to answer the latest request by resident Jens Dam who has been challenging council about how it has handled its development charge bylaw and twice won Ontario Municipal Board (OMB) rulings against the township over the same issue.
Dam wants to know how council plans to collect on rebates and deferrals made to contractors to make up the shortfall in its development charge reserve. His latest request was made on April 4 with Dam appearing as a delegation at the April 8 council meeting. Dam has contended council had 30 days to resolve the matter of refunds and deferrals. “If there’s a shortfall how are we going to deal with that shortfall being brought back?” he said during his brief presentation.
“I can’t agree with Mr. Dam that refunds are owing within a 30-day period,” Mullin responded.
He said there was no 30-day refund policy put in place based on the Ontario Municipal Board (OMB) ruling handed down in March. The OMB, according to the lawyer, did not amend the township’s development charge bylaw that would have required a 30-day refund period.
Mayor Ray Tout said the 30-day refund would have been required if there had been overpayments by contractors on the development charge.
“That’s not part of the OMB order,” Tout told Dam about the 30-day refund.
Dam said under the Development Charges Act 1997, the township was not allowed to pay out refunds or allow payment deferrals.
“Money from the reserve may only be spent for capital costs, it is not allowed to be refunded,” he said.
In the two OMB rulings won by Dam, the first one dealt with the way council brought in the bylaw by lowering development charges, which was struck down by the OMB because a proper study was not conducted prior to the bylaw being approved.
The second hearing, held in January, dealt with Dam’s contention council did not have the right to make its bylaw retroactive and issue refunds and deferrals based on the retroactivity. The OMB ruling issued March 5 sided with Dam and ruled the township could not make the bylaw retroactive to Jan. 1, 2011. The OMB ruled the bylaw was in place when it was passed by council on May 28, 2012. The new bylaw reduced development charges on single-family homes from $21,090 to $14,000 in a bid by council, to spur development in the township. The case, which has dragged on for over a year, saw Dam served with legal papers alleging he defamed township staff. It also drew sharp criticism from the mayor of Dam’s efforts which eventually led to Tout issuing an apology to Dam.
On Monday Tout vowed to continue looking at ways to recover the $229,476 in refunds and deferrals. The figure was issued by the township lawyer after Dam instituted a Freedom of Information Act request. The controversy over the township’s handling of development charges was criticized by councillor Andy Lennox, who said council should have explored other options when the charges were first brought in in 2008. “I’m not satisfied with the direction we had in the past and I will be looking for a change,” Lennox said.
His comments come on the heels of an option presented by Ken Clark, president of Clark Consulting Services. The township is in the process of updating its current development charge bylaw which, under the Development Charges Act, has to be renewed every five years. The current bylaw expires in mid-June. The township has relied on the consulting firm Watson and Associates Economists Ltd. for work needed to bring in a new development charge bylaw. The firm has been involved with the charge since it was brought in in 2008 and also does work for the township’s water and sewer rate bylaw.
The issue was brought to council’s attention by Chief Administrative Officer (CAO) Lori Heinbuch at a March council meeting. She presented a proposal from Watson and Associates to do the work required for the new development charge bylaw. At the meeting, councillor Lennox inquired whether the township had looked for other companies that provide similar services.
The proposal from Clark was released at council Monday evening and drew the attention of Lennox and councillor Dan Yake. Lennox told the Advertiser he was interested in an option presented by the consultant to take water and sewer charges, established to pay for infrastructure upgrades needed for new development, out of the development charge bylaw.
“From the information supplied, it would appear your current development charge includes a special area charge for water and wastewater (sewer) services,” Clark stated in his proposal. “We would suggest that council consider removing these services from the development charge and place them within a separate bylaw under the Municipal Act as an impost fee. A bylaw for an impost fee is approved once and is not subject to a five-year update and public meeting.”
“We have to take a long, hard look at water and sewer in a different way,” Lennox said. “I’d like to see us separate out water and sewer.”
Yake agreed, saying “We’ve had our issues with development charges since 2008.”
“We really need to go back to the drawing board or take a long look at how we proceed with development charges,” he said. “Unfortunately it looks like we’re going to have to carry on in the same way we have in the past.”
Tout agreed there should be a review on how the township will deal with paying for new development.
Lennox was also critical of the issue coming before council close to when the bylaw has to be renewed. “The late hour of this coming to council, I found very distressing,” Lennox said.
Council decided to go with Watson for work on the updated bylaw.
Dam said he will continue to press council to have money returned to the development charge reserve, an issue Tout vowed council will address.
