Following the Region of Durham’s release of their Development Charge Background Study, representatives from DRHBA and BILD met with the Region on April 6.

Regional staff prepared a presentation, which was followed by Q&A.

Highlights from the meeting include:

Important Dates:

• The current bylaw needs to be replaced by July 1, 2023
• The public meeting will occur on April 12, 2023.  It will be a Special Council meeting, held on what is normally a Committee of the Whole meeting date.
• The final date for public comment is on May 5, 2023.  This is earlier than normal as staff are planning to release the final recommendations in early to mid-June.
• The new DC bylaw will be brought to council at a Special Council meeting on June 14, 2023.
• The new bylaw will be implemented on July 1, 2023.

General Information About the New DC Bylaw

• The new DC bylaw will expire 10 years after it comes into force.
• There is a multi-year phase-in of rates, as required by Bill 23.
• ·         Year 1 – 80% of full charge
• ·         Year 2 – 85% of full charge
• ·         Year 3 – 90% of full charge
• ·         Year 4 – 95% of full charge
• ·         Years 5-10 – 100% of full charge
• The Region has not accounted for the discount in the new rate, which means there will be a cash shortfall for the Region due to the phase-in.
• Housing services has been removed from the DC as it is no longer eligible (Bill 23).
• Discounts will apply to rental housing.  One bed – 15% discount, Two Bed – 20% discount, Three bed – 25% discount
• Non-profit housing, inclusionary zoning units, and affordable/attainable units will be exempt from DCs.  The Region is waiting on a bulletin from the province to define what “affordable/attainable housing” is.
• The historical level of service has increased from 10 years to 15 years.

Proposed Policy Changes

• The new DC bylaw is proposing to change the definition of a bedroom to better align with the Ontario Building Code.
• Stacked townhomes will be treated as apartments (they already are in the Transit DC).  The DC charges will be based on bedroom count.
• Redevelopment credit will be changed from 10 years to 5 years.
• All of the proposed policy changes are endorsed by area municipal staff.
• The Region’s Collection Policy for residential subdivision agreements will be: 100% at signing or 50% of water/sewer/roads at signing, balance due at 1 year anniversary of signing and letter of credit for 55% with 100% at building permit, whichever is first.  For rental housing, at building permit issuance or on deferred payment basis.

Why is the increase so much?

• The new 10-year growth forecasts for population and employment are lower and denser compared to the 2018 DC bylaw.
• Fewer new units and more high density units result in a higher residential DC.
• The capital forecasts are more expensive.  Soft services are up 10-100%, hard services are up 70-100%.
• There is new large-scale infrastructure required in the 10-year forecast.
• The calculated DCs are approximately 91-102% higher compared to current rates.
• The phased-in DCs are approximately 26-43% higher compared to current rates.
• The increase is predominately related to water, sewer and roads.
• The Transit DC increase in the background study reflects the phase-in that is already in place, as the Transit DC was approved in November.  It will also be indexed because it’s already in existence.
• The shortfall in DC revenue will be rationalized through budget planning and could result in increased user fees.  For example, water and sewer rates will go up to fund capital projects, where historically this has not happened.

Population and Employment Forecast

• The forecast period is 2023 – 2033 (10 years)
• It extends the population and employment forecasts contained in the current OP.
• The forecasted population of 923,510 will be reached by 2033.
• The forecasted employment of 320,600 jobs will be reached by 2033.
• The forecast was prepared excluding Seaton for water/sewer services, and including Seaton for all other eligible Regional services.
• The provincial assignment of municipal housing targets of 84,000 new units and the recent release of Greenbelt lands will be assessed through future DC background studies.
• There is a shift to high density units.  For single/semi detached – 52% in 2018 DC Study to 41% in 2023 DC Study.  Medium density has gone from 26% to 28%, and apartments have gone from 22% to 31%.
• The population growth is 40,000 less than expected and that is factored into the 2023 DC.
• The DC is based on the current OP, as Envision Durham has not yet been approved by council and the province.  As this is a 10-year bylaw, it may need to be opened up earlier for amendments due to updated numbers in Envision Durham.

DRHBA, along with BILD, has retained Altus Group to review the background study.

If you have any questions, comments or concerns, please contact Stacey.