Development charges are rising faster in Sarnia.
Advertisement 2
Article content
City council recently voted to get rid of a five-year phase-in period for development charge increases.
Changes, under the recently enacted provincial Cutting Red Tape to Build More Homes Actpermit scrapping the phase-in system that was part of Sarnia’s new development charges by law, passed earlier this year.
City staff had projected — based on the $1.9-million average in development charges collected via building projects over the last three years — that without scrapping the phase-in, that started at 80 per cent in 2024 and was set to rise five per cent per year until 2028, Sarnia would be on the hook for $950,000 over five years.
The money collected from development charges in the city goes towards development-related infrastructure projects like major roads and sewers, city officials have said
Advertisement 3
Article content
“Staff recommends removing the phase-in based on the principle that growth should pay for growth,” a city report council considered June 3 says, noting it’s recommended the rate hit 100 per cent Jan. 1, 2025, giving time for developers to prepare for the change.
That means raising rates to $43,415 for single and semi-detached builds in Development Area 2, and to $21,192 elsewhere in the urban area, from $34,732 and $16,954 respectively, the reports says
Council agreed 6-2.
Coun. Bill Dennis spoke against the move, warning higher costs will slow growth.
“This is going backwards,” he said.
Buyers in Sarnia, where the real estate market cooled to a buyer’s market to start 2024, before rebounding to balancedare very price sensitive, said Sarnia-Lambton Association of Realtors president Jeremy Guerette.
Advertisement 4
Article content
“To add any more cost is just really going to slow down development,” he said, calling the council decision disappointing.
“The new construction side of things has been slow in the last couple of years, so any increase is not going to help that at all,” he said.
Last year, officials in the development community were worried about rate hikes of about 30 per cent over five years under the then-draft development charges by law, and wanted more time to check the numbers.
Council initially voted to wait and provide time for that review, then reversed course and passed the bylaw after it was made clear waiting would mean no bylaw in the interim under provincial rules, major fee breaks for developers, and a major funding hit to the city.
Advertisement 5
Article content
Sarnia’s operations general manager said at the time development charge revenue losses would have to be made up through tax or rate increases.
Development charge exemptions, meanwhile, continue under the new provincial rules for affordable and purpose-built rental housing, the city report says.
Other changes in the new act include allowing municipalities to impose time limits for developers to get projects built, eliminating the requirement for pre-consultation for official plan and zoning bylaw amendments, and reducing a development charge freeze for applications to 18 months instead of two years , the report says.
Sarnia may also be among the Ontario municipalities required to report planning information to the Ministry of Municipal Affairs and Housing every three months, starting in October, the city report says.
“This is a significant size bill,” community services general manager Stacey Forfar told council June 3, noting the staff report is a “modest summary.”
Article content