OHBA is seeking comments from members in relation to Bill 17 - Protect Ontario by Building Faster and Smarter Act, 2025.
All comments are to be sent to kjensen@ohba.ca no later than May 31, 2025.
[2] DEVELOPMENT CHARGES ACT
Proposal number: 25-MMAH003, Link to commenting post: Ontario Regulatory Registry, comments open until June 11th.
The following amendments to the Development Charges Act, 1997 have been proposed:
1. Create a Regulation-Making Authority to Merge Service Categories for Development Charge Credits: When builders construct infrastructure for a municipality, they can recoup those infrastructure costs in the form of a credit used towards their DCs payable. However, unless the municipality provides an exception through an agreement, these credits can only be used towards DCs for the same service (for example, DC credits for road-related infrastructure can only be applied to road DCs.) This proposal would create a new regulation-making authority to merge service categories for the purpose of DC credits.
2. Create Regulation-Making Authority to Specify What Constitutes a "Local Service":
"Local services" are infrastructure that a municipality can require a builder to build as part of their development. Examples could include sidewalks or street lighting. Currently, the Development Charges Act, 1997 prohibits municipalities from levying DCs in respect of these local services. However, there is no formal definition of "local services" in the Act. This proposal would create regulation-making authority to prescribe what constitutes a local service for which DCs may not be charged, but which may be secured through agreements as a condition of land division.
3. Expand the Development Charge Deferral to Non-Rental Residential Developments:
Currently, most DCs are payable to municipalities at the time a building permit is issued. DCs on rental housing and institutional development are able to be paid in instalments later in the development process, beginning at occupancy. This proposal would provide for payment of DCs for non-rental residential developments to be made in full at the earlier of the date an occupancy permit is issued and the date a development is first occupied.
Related amendments would also:
-provide municipalities with the authority, in circumstances set out in regulation, to require a financial security to secure payment of deferred DCs for residential developments other than rental housing developments, subject to any limitations on that security set out in regulation; and
-remove interest from being charged by municipalities on any legislated DC deferral amounts, except to the extent such interest has accrued prior to these changes coming into force.
4. Changes to Reduce DCs:
If a municipality wishes to amend their DC by-law to provide developments relief, such as from increases due to indexing of rates, the municipality would need to undertake certain procedural steps such as preparing a background study. To save municipalities time and improve cost predictability for new developments, this proposal would enable municipalities to make any changes to their DC by-laws for the sole purpose of reducing DCs or removing indexing, without having to undertake certain procedural requirements, such as preparing a DC background study or holding a public meeting.
5. Create a Regulation-Making Authority to Limit Eligible Capital Costs:
The Development Charges Act, 1997 lists capital costs that are eligible to be recovered from development charges. This proposal would create regulation-making authority to prescribe exceptions, including conditional exceptions, to capital costs that are eligible to be recovered from DCs, including the costs of acquiring or improving land.
6. Changes to the Application of the DC Freeze:
DCs are set ("frozen") when a builder submits a site plan application or zoning application to the municipality. The DCs remain frozen for eighteen months after the relevant application is approved. The development pays the frozen DC rate if they are issued a building permit within the freeze period; otherwise, the development must pay the current development charge rate. To help prevent homebuilding from being delayed and to reduce the administrative burden on builders and municipalities from re-submitted applications, this proposal would provide that frozen DC rates are not applicable if the current DC rates in effect would result in a lower payment.
7. Exempt Long-Term Care Homes from Development Charges:
Currently, long-term care homes are considered an institutional development and payment of the applicable DCs is deferred to the day an occupancy permit is issued or the day on which the development is first occupied. However, despite the payment deferral, payment of DCs for these institutions can serve as a financial barrier for the building of this provincial priority. This proposal would exempt long-term care homes within the meaning of subsection 2 (1) of the Fixing Long-Term Care Act, 2021 from municipal development charges. For long-term term care homes that are combined with other types of development, such as commercial developments, only the long-term care home portion of the development would be exempt from DCs.
