ERIN – Development charges (DCs) in the Town of Erin are taking a big spike upwards – 48% more for new homes and 58% more for new businesses in the urban areas.
Town council accepted the results of a development charges study at their May 21 meeting. A public meeting will be held at the town hall on June 18, at 6:30pm for people to make comments and ask questions. Comments can also be made by email, and a video on the subject is available at erin.ca.
Development charges are not set by provincial law, but increases must be justified by a study every five years. Erin council has received the most recent report by Watson and Associates, and the new rates are to take effect with the passage of a bylaw on July 22.
Mayor Allan Alls said he is expecting some complaints from developers, but said it is important that municipalities not fall behind in recovering their costs.
Councillor Mike Robins said the new fee structure “doesn’t seem overly burdensome,” especially considering the overall cost of a new home.
The report is based on a forecast of a population increase of 1,607, with 650 new homes within 10 years. The outlook to 2041 shows 6,589 more residents and 2,283 more homes.
Currently, for the construction of single or semi-detached homes, the builder would pay $11,551 in rural areas and $15,104 in urban areas (with water service). Business properties pay $4.58 per square foot in rural areas and $6.06 for urban.
The new rates for singles and semis will be $17,258 in rural areas and $22,284 for urban. The business rates will rise to $7.52 per square foot for rural and $9.55 for urban.
The report shows that the new rates are similar to those in other Wellington municipalities. The rates do not include wastewater, which will be instituted once that service is available.
DCs are designed to help municipalities pay costs related to new development, in areas such as transportation, fire protection, parks, recreation, administration and water supply. The report estimates that the town will need to spend a total of $27.2 million on capital projects over the next five years, with $16.3 million to be recovered through DCs.
The balance of the combined DC reserves at the end of last year was about $1.7 million, including $1 million for transportation, $198,000 for fire protection, $270,000 for parks and recreation, $216,000 for water and a deficit of $64,805 in administration. In her annual report to council, finance director Ursula D’Angelo said $200,000 in DCs was collected by the town in 2018, significantly lower than the $430,000 collected in 2017.
Withdrawals from DC reserve funds in 2018 included $33,000 for debt payments on Hillsburgh Fire Station 50, $26,000 for debt on the Barbour fields expansion, $64,000 toward the $190,980 cost of the wastewater environmental assessment and $155,000 of the $173,000 cost of the water servicing environmental assessment.
D’Angelo also reported on the cash in lieu of parkland fund. This holds additional contributions from developers, which in 2018 totaled $75,000.
A withdrawal of $39,798 was made for the McMillan Park revitalization initiative. The parkland fund balance at the end of 2018 was $916,831, having earned interest of $22,087.