The amount of money developers are subsidizing the city’s infrastructure with is going up dramatically.
Development charges are the way the city extracts money from the companies building all our new condos and office towers to help defray the costs of, among other things, transit, water and sewer, roads and parks. They come up for renewal every five years, but this year, the city in its eagerness has already reached the penultimate step in approving an average of a 70 per cent increase in the rates seven months in advance of the April deadline.
"For a two-bedroom condo, the rates are increasing about 70 per cent, from about $12,000 a unit to just over $21,000," says Rob Hatton, the director of strategic initiatives in the city’s corporate finance division.
The almost completed
Aura at College Park, for instance, would pay the city and its residents about $20 million in
development charges under the new system.
The rates for single-family dwellings is rising even higher, by 78 per cent.
"It’s a substantial increase," Hatton says, pointing out that even thought it’s slightly less than the last increase five years ago, that increase was belayed in response to the financial crisis in 2008 and 2009.
"The city is clearly growing," he says, "so we’ve had to make significant investments to maintain service levels."
Writer: Bert Archer
Source: Rob Hatton