Claim: Municipally imposed development charges are much lower in other communities and contractors are finding it unfair in the City of Greater Sudbury.
Despite a perception among some people that the City of Greater Sudbury’s development charges are unreasonably high, they’re actually well below the provincial average, although not all municipalities charge them, including some in Northern Ontario.
Development charges were discussed at length during Tuesday’s finance and administration committee meeting, during which city council members debated a 17.2 per cent development charge increase that will take effect on July 1.
In his argument to impose a 4.4-per-cent increase instead, in keeping with the Consumer Price Index increase, Ward 5 Coun. Robert Kirwan said the optics of a 17.2-per-cent increase aren’t great.
“We always hear about how it’s cheaper, the development charges are so much lower in other communities and our contractors are finding it unfair in Sudbury,” he said during the meeting, later clarifying with Sudbury.com that although he doesn’t support this perception, it’s out there.
This isn’t what Sudbury and Districts Home Builders’ Association president Derek Cashmore said he has heard, and said the perception within the construction industry is that Greater Sudbury is “at par if not better than a lot of the different municipalities.”
The perception that Greater Sudbury developments are more expensive might be because of people comparing it to the way things used to be, he said, “but everything in the globe has changed, and prices have gone up and cost of demand and labour and material shortage, but as a whole we’re still very competitive, very blessed.”
Development charges are levied on new builds in keeping with a “growth pays for growth” direction, as city financial planning and budgeting manager Steve Facey put it earlier this week. The fees collected go toward funding growth-related capital expenditures.
Different charges are levied depending on the build. Greater Sudbury’s current rates, in effect until June 30, are $18,910 for a single detached family dwelling, $15,193 for a semi-detached dwelling (per unit), $10,913 per unit for multiple-unit dwellings, $3.16 per square foot for industrial builds and $4.74 per square foot for commercial/institutional builds.
These are the rates for builds on fully serviced land, and properties without water and/or wastewater service carry lower rates.
The average single detached family dwelling development charge among 114 Ontario municipalities listed in the latest BMA Management Consulting Inc. report was $40,217. The average development charge was $19.98 per square foot for non-residential commercial development and $11.76 per square foot for non-residential industrial.
Of the 114 Ontario municipalities listed, eight have no development charges attached to them.
Among these municipalities is Sault Ste. Marie, Timmins and Thunder Bay. North Bay has a non-residential commercial development charge of $4.25 per square foot but doesn’t have any development charges related to residential developments.
Although some municipalities do not have development charges, it doesn’t mean there aren’t municipal fees attached to new developments.
City of Timmins planning manager Cindy Welsh noted that they have a cost recovery bylaw (amended here) for certain areas of the municipality to help cover the cost of new infrastructure associated with new builds, “but it’s not a development charge in terms of the definition.”
The City of North Bay is currently looking at introducing development charges, and have deferred the issue to next year’s incarnation of city council to make a decision.
Sault Ste. Marie city council decided in 2016 against introducing development charges, although they do have a schedule of application fees for developments.
Despite these variables making the waters of comparing municipalities a bit murkier, Cashmore said that Greater Sudbury is recognized in the construction industry as being “well-positioned, very competitive.”
“We’ve got engagement and interaction with city councillors, building codes, land development, the mayor’s office,” he said, adding that the one-stop-shop opening soon at Tom Davies Square is “phenomenal” and will help streamline municipal operations such as building permits approvals.
Despite this, he added that a 17.2-per-cent increase in Greater Sudbury’s development charges will be a tough pill to swallow alongside other costs of construction rising across the board.
“I think it’s definitely going to impact the new home builds, however, we still need a lot of new homes in the city.”
Verdict: Although some municipalities’ development-related charges are lower than those in Greater Sudbury, the city’s charges are on the low end of the scale in Ontario as a whole.
Tyler Clarke covers city hall and political affairs for Sudbury.com.
