Time to pay up on development charges
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by Chris Simon

Don't feel too bad for Innisfil developers, they'll be fine.

Although the town is looking at increasing development charge rates by up to 161 per cent, local developers and new homeowners have gotten lucky over the last few years. In Alcona and Lefroy, developers are currently charged $14,623 for fully serviced single and semidetached units, while residential construction in Cookstown comes with a $22,394 cost. Even when you take into account the $3,425 in development charges that are also demanded by the County of Simcoe, Innisfil has still been a relatively cheap place to build a home, when compared to many other Greater Toronto Area communities.

As part of the town's development charge report, consultants reviewed fees from 12 other municipalities ranging from Angus and New Tecumseth to Brampton and Aurora. King Township had the highest charges at $36,496, while Clarington had the lowest at $23,612, when including the rates charged by their upper tier municipalities.

Turns out, it's actually been cheaper to build a home in Alcona and Lefroy than in any of the other municipalities surveyed. Meanwhile, Cookstown finishes in the middle of the pack.

Gilford is the only community within the town where development charge rates will decrease, dropping from $86,238 to $82,205. Building in Gilford would still be more costly than in any of the municipalities surveyed, but that end of the town is not the planned hotbed for potential growth.

While Barrie's rate is set at $17,311, the city will be running out of room to develop over the next few years, leaving Innisfil as the natural alternative for new home buyers.

Even if the new charges were implemented as planned, most new town development would only be charged a few thousand dollars more than in King. Alcona, Lefroy and Cookstown fees would all range between $38,885 and $46,729.

Many of the municipalities surveyed are also currently undergoing a review of their fees. It looks like most of them will be following the lead of Innisfil and boosting their rates.

It's necessary, to help pay for the millions of dollars in new infrastructure that will be required over the next few decades, as the population across Southern Ontario continues to climb. These fees help pay for the basic roads, sewer and water services that help keep living standards high.

Developers have expressed concern with several aspects of the town's proposal. Some say they haven't been given enough time to study the report, while others suggest the fees would have a negative impact on their business.

The town should probably push back the implementation of the fees, which is scheduled for early next year, and attempt to negotiate with developers.

While town staff probably want to have the fees implemented in time for the start of spring construction, many developers have already hinted at legal action. It's an avoidable outcome, and something that could be handled with a few months patience.

Developers, on the other hand, have to stop spreading a doom and gloom scenario. It's unlikely that many homebuyers are going to back out of a purchase, simply because development charges increase by about $20,000. When a buyer already plans to spend several hundred thousand dollars on a new home, a five or 10 per cent bump probably isn't enough to call off the deal.

Homebuyers will still come to Innisfil, especially when they compare prices in Barrie, and impending fee increases in surrounding municipalities. As a result, developers won't have vacant lots or dramatically increased costs to absorb.