Ottawa to increase municipal development charges by 11%

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Ontario Construction News staff writer

Ottawa’s municipal Planning and Housing Committee has approved an 11 per cent increase in development charges for new single family and semi-detached homes – meaning fees will reach $57,596 on homes built outside the city’s Greenbelt.

The increases of between $4,700 and $6,200 for each home are less than a proposed $12,000, but the Greater Ottawa Home Builders Association (GOHBA) still believes these increases are excessive and will fund infrastructure that is more appropriately paid through general tax revenue.

The committee approved the changes last Wednesday (May 9) and city council will vote on the recommendations at its meeting on Wednesday.

The city’s current development charges bylaw is set to expire on May 22. “To ensure the city can continue to collect fees, Council will need to enact a new by-law before that date,” the city said in a statement. “This will ensure that those benefitting from new growth within Ottawa are the ones paying for the associated initial capital costs needed to service it.

“The development charge costs would still represent about five to seven per cent of the cost of new homes in Ottawa,” the statement says.

The new bylaw will raise charges on single and semi-detached homes inside the Greenbelt to $48,265 from $43,494 and the fees outside the Greenbelt will increase from $51,376.

The new bylaw reflects two background studies approved by the committee: the primary development charges background study as well as a study of individual stormwater management ponds and drainage systems.

However, the GOHBA has raised concerns about the increases after people had already signed contracts to build new homes. Executive director Jason Burggraff said that development charges should not cover certain projects such as aquatic facilities, according to CTV News.

“There are many projects in the background study that arguably don’t belong in the background study,” Burggraff said. “They disproportionately are costing to future home buyers as opposed to the general population overall.”

Dean Tester, co-founder of making Housing Affordable, told the committee the higher fees could create a “bigger hole” in Ottawa’s budget.

“We’re driving urban sprawl, we’re driving people out of the city with the high cost of housing in Ottawa, especially young families,” CTV quoted Tester as saying. “I’t really crushing our economy and our city budget.”

However, city staff shared statistics showing that Ottawa’s development charge rates are still significantly lower than several other Ontario cities. The charges cost homebuyers $145,361 in Vaughan, $132,839 in Markham, $124,876 in Brampton, $118,308 in Mississauga and $97,041 in Toronto. Charges in London are closer to Ottawa’s level at $44,076.

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