06-01-2025, 08:05 AM
(05-31-2025, 08:47 PM)dtkvictim Wrote: I think if we step back, despite all of the shouting, people know what the available sources of funds are but may disagree on what "fair" is. So I would reiterate would I said before. If we take the figure brought up earlier for a 900% increase in Toronto DC charges we should have alarm bells going off that something isn't fair. The only options are a) previous developments underpaid: where was the shortfall made up? or b) current developments are overpaying: where are the surplus funds going?
Either of those options represent an "unfair" situation. I suppose a third option is that we reject both scenarios and somehow the cost of delivering new services has increase 900% in less than 15 years, but I'd like to see proof of that. And despite being hidden behind convoluted reasons, I still wouldn't call that a "fair" situation.
I think there is some truth in both those options: the previous development fees were lower than what was needed for servicing the new development projects, but there was sufficient revenue from property taxes that this was not a problem. In the last 20 years, though, successive provincial governments have downloaded additional responsibilities to the municipalities--somewhere on the order of $4B provincially--so the property tax revenue is needed elsewhere. And the municipalities have turned to development fees to bridge the revenue gap.
10x in Toronto is super high, but not knowing what the baseline was makes it hard to know whether that is particularly bad or whether the fees were ridiculously low 15 years ago.
Now, the fees today are arguably too high for multi-residential, whether high-rise or mid-rise, condo or rental, as the servicing costs per unit are far less than for SFH housing. Reducing those fees for multi-residential (or in urban areas, or for infill projects) would make that type of housing more attainable without a huge impact in property taxes, but is that politically achievable?
The province downloaded services to the municipalities because they wanted to avoid political backlash from raising taxes. And municipalities are desperately trying to avoid significantly raising property taxes for the exact same reason. But if we build new housing (which everyone agrees we do need) ultimately someone needs to pay for the infrastructure extensions and upgrades.
(I'm here intentionally avoiding judging what is "fair" or "unfair", and just trying to relate development fees to the infrastructure costs associated with building that housing.)