August 2019
Backgrounder
Development charges are a municipal revenue tool used to recover the costs of new municipal infrastructure needed to serve new neighbourhoods or developments. Provincial rules determine how these charges are calculated. Historically, municipalities have sought provincial rules which serve the principle of growth paying for growth to recognize the service demands on the existing property tax base.

Bill 108, The More Homes, More Choice Act, 2019 made significant changes to the Development Charges Act, 1997 and Planning Act, 1990.

Development Charges Reform
On a positive note, municipal governments may now charge the full capital cost of waste diversion and ambulance services in calculating development charges. Yet, AMO is concerned that other changes limit the municipal government’s ability to fund the maintenance and expansion of essential public infrastructure projects.

Previously, development charges were payable in advance. Bill 108 extends the payment schedule and complicates the local public administration. If a development is rental housing, institutional, commercial or industrial, development charges are now payable to the municipality as six annual instalments commencing at occupancy. The repayment timeframe is extended to 20 years for non-profit housing.

Community Benefit Charge
A new framework has replaced parkland dedication, density bonusing (Section 37 of the Planning Act, 1990) and “soft services” charges for child care, libraries and recreational facilities with a Community Benefits Charge (CBC).

A formula based on the value of land would determine the maximum amount of community benefits charge. Ministry of Municipal Affairs and Housing posted the new regulation pertaining to the community benefits authority under the Planning Act on the Environmental Registry of Ontario. The consultation period closes on August 21, 2019. AMO’s key goal is to ensure that regulations related to the new charge system support the principle that growth pays for growth.

AMO advocated for municipal interest at the Standing Committee on Justice Policy and in continuing discussions with the Ministry.