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Home My WebLink AboutFIN-06-059 - Funding Adjustments - Development Charge By-law, Ontario Municipal Board Appeal ~ Report To: Date of Meeting: Submitted By: Prepared By: Ward(s) Involved: Date of Report: Report No.: Subject: Councillor B. Vrbanovic, Chair, and Members of the Finance and Corporate Services Committee December 11, 2006 Pauline Houston, General Manager of Financial Services & City Treasurer Pauline Houston (2646) ALL December 6, 2006 FIN-06-059 RECOMMENDA TION: Funding Adjustments- Development Charge By-Law, Ontario Municipal Board Appeal THA T a transfer of $2,028,455 from the tax stabilization reserve fund to fund the net changes to the following projects as a result of the Ontario Municipal Board decision issued on September 5, 2006 (Decision /Order No. 2483) be approved: · Soccer facilities $17,186 · Downtown Community Centre ($109,910) · Victoria Hills Community Centre $1,210,477 · Chandler Mowatt Community Centre $1,143,145 · Schneider Creek Channel $323,754 THAT a transfer of $2,028,455 from the above projects to Development Charge reserve fund be approved. THAT by-law 2004-156 be amended to replace Schedule A with the Schedule attached to staff report FIN-06-059 to reflect the Ontario Municipal Board Decision/Order No. 2483, issued on September 5, 2006 and to incorporate Council's resolution on January 17, 2005 amending the definition of "existing industrial building." FURTHER THAT Staff be directed to proceed with the preparation of a service specific amendment to the 2004 Development Charge Background study to implement the remaining increases in project cost estimates and growth allocation changes that were endorsed by the Ontario Municipal Board in its Decision/Order No. 2483, to be brought back to Finance and Corporate Services Committee for consideration in early 2007. REPORT: The City's Development Charge By-law (By-law 2004-156) was appealed to the Ontario Municipal Board by the Waterloo Region Homebuilders' Association and the Board issued its decision on the appeal on September 5, 2006 (Decision/Order No. 2483). As a result of the Board's decision some adjustments are necessary; however the overall development charge rate remains the same. The Ontario Municipal Board affirmed a number of adjustments to the Parks and Recreation Service proposed by City staff early in the process, as follows: · separate the calculation of the rate into two components - indoor Parks and Recreation and outdoor Parks and Recreation · take a neighbourhood approach to the allocation of growth to individual Community Centre's as opposed to a City wide approach · include the increased estimated project costs for two major facilities that were included in the calculation (New Twin Ice Pad Arena and New Pool) · revise the pricing of the existing service level inventory for community centre's and arenas based on a quantity surveyor pricing analysis report As a result, the residential development charge rate for Parks and Recreation services increased slightly ($55.03 per single family dwelling), but the allocation of the growth component to individual projects changed, resulting in a timing issue for projects that had been funded during the time period between when the by-law was approved (June 2004) and the Ontario Municipal Board decision (September 2006) The Ontario Municipal Board decision with respect to the Shirley Avenue project called for the growth allocation to be changed from 100% related to residential growth, to 60% residential growth and 40% non-residential growth. As a result, the residential development charges for Roads services decreased by $209.75 per single family dwelling. This reduction was offset by inclusion of some increases in project cost estimates for Schneider Creek, Middle and South Strasburg Sanitary Sewer, and Strasburg Road. The overall net impact of the above on the approved development charge rates is no change. The Development Charge By-law had also been appealed by 1090504 Ontario Limited on a very narrow point related to the definition of "existing industrial building" and Council passed a resolution on January 17, 2005 (attached hereto as Schedule B) agreeing to amend the definition to be the same as in the City's previous development charge by-law. This appeal was settled on that basis. Attached is an amended Schedule A to the Development Charges By-law that reflects the following changes: · Revised listing of services · Revised rate schedule based on the revised listing of services (i.e. no rate impact) The Ontario Municipal Board does not have jurisdiction to increase rates beyond what was originally approved in the City's by-law. There were a number of revised project cost estimates identified as part of the hearing process, and staff is recommending that the City proceeds with a "service specific" amendment to the existing background study for the following services: · Sanitary Sewers · Storm Sewers · Roads · Fleet In addition, this proposed amendment would include the non-residential rate impact of the Ontario Municipal Board decision related to Shirley Avenue. It is anticipated that this amendment process would take a couple of months and would be subject to the Public Hearing process for these specific changes only. A staff report will come forward to Finance and Corporate Services Committee for consideration in early 2007. The other option is to continue with the existing rates and complete a full background study as part of the regular five year review of the development charge by-law in 2009. The estimate of the potential difference in development charge revenue for the intervening period is $1,000,000. FINANCIAL IMPLICATIONS: As outlined in the body of the report. Pauline Houston, CA General Manager of Financial Services & City Treasurer PH/mf SCHEDULE "A" Residential Rate 2006 Central Suburban Services Neighbourhoods Area Sanitary $ $ 709 Storm/Watercourse $ $ 25 Watermains $ $ 96 Studies $ 7 $ 7 Engineering Studies $ $ 48 I ntensification Allowance $ 610 $ Roads $ 77 $ 581 Fire $ $ 112 Fleet $ $ 124 Library $ 81 $ 81 Parks and Recreation - Indoor $ 636 $ 658 Parks and Recreation - Outdoor $ 159 $ 159 Per person charge 1,570 2,600 Single family & semi 2.90 ppu 4,552 7,540 Townhouse 2.80 ppu 4,395 7,280 Multiple dwelling 1.90 ppu 2,983 4,940 Lodging house 1.00 ppu 1,570 2,600 Non-Residential Rate 2006 Services Sanitary Storm/Watercourse Watermains Studies Engineering Studies I ntensification Allowance Roads Fire Fleet Central Neighbourhoods $ $ $ $ 0.14 $ $ 11.07 $ 0.69 $ $ Per square metre charge Per square foot charge 11.89 1.10 NOTE: The above figures are in 2006 dollars, and have been indexed in accordance with paragraph 21 of the DC By-law. Suburban Area 17.03 1.58 Schedule A 2.83 1.49 1.51 0.14 1.02 5.05 2.32 2.68 Schedule B JANUAIRY 17, 2005 .12. COMMITTEE OF THE WHOLE CITY OF KITCHENER JANUARY 17, 2005 ..13. CITY OF KITCHENER B.