Residential, commercial developers in Essex County to pay thousands in new fees come 2028
CBC
Essex County council has voted to introduce new fees for developers — adding thousands to the cost of new builds — in order to pay for municipal services and infrastructure.
After significant debate, councillors voted Wednesday evening to add these development charges on a five-year phase-in schedule — but instead of the first charges coming Jan, 1, 2027, have them come Jan. 1, 2028.
Development charges are fees paid by developers when they build new homes or other types of buildings to cover the costs of municipal services needed to support growth — like roads, sewers, libraries and paramedics services.
While developers pay development charges up front, they're typically then passed along to new homebuyers in the cost of the home.
At the meeting, councillors debated affordability and economic uncertainty, and how it impacts growth and current taxpayers.
Some noted that housing is already expensive, and construction is slowing on already expensive homes — arguing that the county can't afford to make new houses even more expensive if the region wants to continue to grow, and the issue should be re-visited when the region's economy feels more stable.
Other councillors argued in return that growth is inevitable, and infrastructure needs to be paid for — without development charges, that cost falls on existing taxpayers who are already struggling in an uncertain economy.
Ultimately, councillors voted for an amended motion with a pushed-back start time, proposed to help the economy an extra year of time to recover and strengthen before the charges are imposed.
Municipalities in Essex County already have development charges in place, but the county, too, says it requires development charges to "recover the capital costs of providing services required to support growth," a staff report says.
The total amount of the charge would depend on the type of unit, but the charge for a single-family residential home would be nearly $8,600 at full adoption.
That would be in addition to development charges levied by the lower-tier municipality in which the development is located.
There are exemptions in the bylaw, a county report notes: Some industrial expansions, affordable housing developments, and additional units within existing buildings in some cases would be exempt.
Development charges vary widely depending on municipality: In Toronto, the development charge for a single-detached home is about $180,000, according to Canada Mortgage and Housing Corporation (CMHC) data, about 50 per cent of that going to roads and public transit.
Late last year, Windsor froze its development charges at the current rate.
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