Population and Housing

[tomh009]

Why don't municipalities simply lower development charges seeing as Toronto DC's have risen 900% since 2010? Easy way to spur development and add housing stock

Yes ... but the money for infrastructure needs to come from somewhere, either development fees or property taxes. Or improved provincial funding (oops, fell off my chair, have to stop laughing so hard).

[creative]

Could the city borrow to pay for new infrastructure and then use the new tax dollars derived from these new developments to pay down the loan? Does the math work?

[danbrotherston]

Could the city borrow to pay for new infrastructure and then use the new tax dollars derived from these new developments to pay down the loan? Does the math work?

Do you want taxes to go up 900% instead. Creative accounting won’t solve the fiscal reality that sprawl is a money sink. In every city in North America dense old areas subsidize sprawl. And this grows increasingly untenable with every new housing tract built on the periphery.

[creative]

You obviously have not been following this thread. The concern that was being discussed was that development charges on new homes, be it sprawl communities or infill condo developments, add significantly to the cost of a new home. New infrastructure include new roads, bike lanes, multi-use trails, parks, community centers and expanded sewage treatment facilities. I was suggesting another way to possibly cover these development costs to help reduce the cost of new homes.

[danbrotherston]

You obviously have not been following this thread. The concern that was being discussed was that development charges on new homes, be it sprawl communities or infill condo developments, add significantly to the cost of a new home. New infrastructure include new roads, bike lanes, multi-use trails, parks, community centers and expanded sewage treatment facilities. I was suggesting another way to possibly cover these development costs to help reduce the cost of new homes.

You still aren't explaining where this money will come from? The city is insolvent. New roads aren't new, they're rebuilding existing roads. The "new" infrastructure is being paid for with DC dollars because that's easier than raising taxes. Existing homeowners are not paying for the cost of maintaining their infrastructure. Increasing density is the solution, but this isn't really happening in any meaningful way, for every new condo that gets approved at 60% of it's original size, a dozen tracts of farm land are paved over with more suburban sprawl. The city's financial position, in terms of maintenance liabilities compared with future tax revenue, gets worse every year. There is no solution that doesn't involve either a drastic and immediate change to the development pattern or a significant (read 5-10x) increase in property taxes. Hiking the DCs is a stop gap that delays the inevitable, just as some sort of debt mechanism would be a stop gap.

And yes, I am following the thread, it's one of the few that I do follow here. I completely agree with the fact that the DCs are too high, but there is a more fundamental issue with the financing of the city which must be solved. The high DCs are a symptom of that problem. That is why I dismiss your solution of creative financing: not because I think the DCs are fine, but because it doesn't solve any problem, it at best, would only shift the symptoms from one place to another.

Of course that doesn't stop the one forum member here who contributes nothing to this forum except downvotes against me...as I said in another thread, I'm getting sick and tired of the bullshit here. So yeah, maybe I'm kinda grouchy here.

[ZEBuilder]

Could the city borrow to pay for new infrastructure and then use the new tax dollars derived from these new developments to pay down the loan? Does the math work?

The new infrastructure that DC's pay for are things like arterial road extensions (Strasburg Road), new amenities for an area (Southwest Kitchener Park) or upgrades (Sanitary Pumping Stations, Strasburg Trunk Sanitary Sewer). Sure the city could finance it through debt but the reality is you would need costs to be cut elsewhere within the budget if you were to take on those costs. Assuming we are living in an environment where we aren't increasing taxes to fund these. Now if we are getting rid of DCs for new subdivisions are we assuming the road infrastructure is now funded by the city as well and not the developer? In the current set up that is also funded by the developer to the tunes of millions.

Take for example Activa's 1198 Fischer Hallman Road site, so far site grading and servicing has occurred (Activa has paid for all of it), now lets assume the servicing cost is incurred by the city, the city would have to magically come up with the 3.4 million dollars to cover the costs to service the site for the 511 units that will eventually be on it.

Let's say the city has a 10 year loan at 1% interest, the total cost the city would incur over the ten years is 3.6 million dollars. The development itself, under the assumption that it has identical taxes to similar recent developments by Activa will be $941.17 a year to the city, over the 10 years the townhomes will only produce taxes worth 1.43 million assuming 1% inflation (not reality but for simplicities sake). Now sure 1198 also has apartments on it so including those into it with the same rate as the townhomes one gets 5.1 million assuming the same things.

However sure you will have an excess in this case of 1.5 million but keep in mind that you now have to fund everything else in the city that tax dollars are normally used for over that same ten years with 3.6 million less. Without increasing taxes you can't make the math work, are we okay with cutting fire services? Community Centres? KPL? Winter works? Road Maintenance (pothole repairs, reconstructions, line painting, preemptive maintenance)? 

Sure my example is assuming the city takes on servicing of new roads (unlikely even if DCs are removed but you never know what the developer buddies of Ford want) but projects like the Strasburg Road extension or Middle Strasburg Trunk Sanitary Sewer are required for those new developments and were funded via DCs in the realm of millions of dollars. You'll get the same exact issue I mentioned before if we don't increase taxes.

The reality is you either pay DCs or increase taxes, the math doesn't allow for removal of DCs and no increase in taxes especially if we want the same level of service currently provided. Now we could change the way cities are designed to promote significantly more density and stop building endless suburbia but that wouldn't go over well with the vast majority of the populace.

DC's don't go to repairs of existing infrastructure, you use your tax dollars to pay for what DCs pay without increasing taxes and you will spiral into a maintenance disaster.

[creative]

I have no problem with development charges for new builds. As an existing homeowner, I don’t want to pay for new development. I was just suggesting a possible solution to house prices for new buyers. Thanks for doing the math.

[danbrotherston]

Could the city borrow to pay for new infrastructure and then use the new tax dollars derived from these new developments to pay down the loan? Does the math work?

The new infrastructure that DC's pay for are things like arterial road extensions (Strasburg Road), new amenities for an area (Southwest Kitchener Park) or upgrades (Sanitary Pumping Stations, Strasburg Trunk Sanitary Sewer). Sure the city could finance it through debt but the reality is you would need costs to be cut elsewhere within the budget if you were to take on those costs. Assuming we are living in an environment where we aren't increasing taxes to fund these. Now if we are getting rid of DCs for new subdivisions are we assuming the road infrastructure is now funded by the city as well and not the developer? In the current set up that is also funded by the developer to the tunes of millions.

Take for example Activa's 1198 Fischer Hallman Road site, so far site grading and servicing has occurred (Activa has paid for all of it), now lets assume the servicing cost is incurred by the city, the city would have to magically come up with the 3.4 million dollars to cover the costs to service the site for the 511 units that will eventually be on it.

Let's say the city has a 10 year loan at 1% interest, the total cost the city would incur over the ten years is 3.6 million dollars. The development itself, under the assumption that it has identical taxes to similar recent developments by Activa will be $941.17 a year to the city, over the 10 years the townhomes will only produce taxes worth 1.43 million assuming 1% inflation (not reality but for simplicities sake). Now sure 1198 also has apartments on it so including those into it with the same rate as the townhomes one gets 5.1 million assuming the same things.

However sure you will have an excess in this case of 1.5 million but keep in mind that you now have to fund everything else in the city that tax dollars are normally used for over that same ten years with 3.6 million less. Without increasing taxes you can't make the math work, are we okay with cutting fire services? Community Centres? KPL? Winter works? Road Maintenance (pothole repairs, reconstructions, line painting, preemptive maintenance)? 

Sure my example is assuming the city takes on servicing of new roads (unlikely even if DCs are removed but you never know what the developer buddies of Ford want) but projects like the Strasburg Road extension or Middle Strasburg Trunk Sanitary Sewer are required for those new developments and were funded via DCs in the realm of millions of dollars. You'll get the same exact issue I mentioned before if we don't increase taxes.

The reality is you either pay DCs or increase taxes, the math doesn't allow for removal of DCs and no increase in taxes especially if we want the same level of service currently provided. Now we could change the way cities are designed to promote significantly more density and stop building endless suburbia but that wouldn't go over well with the vast majority of the populace.

DC's don't go to repairs of existing infrastructure, you use your tax dollars to pay for what DCs pay without increasing taxes and you will spiral into a maintenance disaster.

I mean, this isn’t true. Sure, on paper they’re not supposed to but when you have to repabe Fischer Hallman and also widen it then all of a sudden it’s an “upgrade” well then most major capital projects are “upgrades” not maintenance.

[tomh009]

Take for example Activa's 1198 Fischer Hallman Road site, so far site grading and servicing has occurred (Activa has paid for all of it), now lets assume the servicing cost is incurred by the city, the city would have to magically come up with the 3.4 million dollars to cover the costs to service the site for the 511 units that will eventually be on it.
(...)
Sure my example is assuming the city takes on servicing of new roads (unlikely even if DCs are removed but you never know what the developer buddies of Ford want) but projects like the Strasburg Road extension or Middle Strasburg Trunk Sanitary Sewer are required for those new developments and were funded via DCs in the realm of millions of dollars. You'll get the same exact issue I mentioned before if we don't increase taxes.
(...)
DC's don't go to repairs of existing infrastructure, you use your tax dollars to pay for what DCs pay without increasing taxes and you will spiral into a maintenance disaster.

I mean, this isn’t true. Sure, on paper they’re not supposed to but when you have to repabe Fischer Hallman and also widen it then all of a sudden it’s an “upgrade” well then most major capital projects are “upgrades” not maintenance.

So, there really are multiple costs, and there is a gradation of grey in the middle.

• Dedicated new infrastructure (site servicing, as noted by ZEBuilder)
  
• Road extensions to the new site (when needed)--not quote dedicated, but maybe not otherwise needed
  
• Road widening (as noted by Dan), probably needed for the incremental traffic volumes--but repaving the rest of the road isn't really new infrastructure
  
• New facilities (parks, libraries, fire stations, recreation facilities etc) to support increased population: these are rarely dedicated, but maybe a big 500-unit suburban development needs 0.02 of a fire station and a 0.01 of a new library location, for example, so funds should be accrued for such infrastructure, too.
  

Kodra24 suggests reducing development charges and that would indeed help the (new) housing prices. But where should the funds come for the above costs? The cities really only have two levers: property taxes and development charges. And the provincial government is not rushing in to help ...

[ZEBuilder]

The new infrastructure that DC's pay for are things like arterial road extensions (Strasburg Road), new amenities for an area (Southwest Kitchener Park) or upgrades (Sanitary Pumping Stations, Strasburg Trunk Sanitary Sewer). Sure the city could finance it through debt but the reality is you would need costs to be cut elsewhere within the budget if you were to take on those costs. Assuming we are living in an environment where we aren't increasing taxes to fund these. Now if we are getting rid of DCs for new subdivisions are we assuming the road infrastructure is now funded by the city as well and not the developer? In the current set up that is also funded by the developer to the tunes of millions.

Take for example Activa's 1198 Fischer Hallman Road site, so far site grading and servicing has occurred (Activa has paid for all of it), now lets assume the servicing cost is incurred by the city, the city would have to magically come up with the 3.4 million dollars to cover the costs to service the site for the 511 units that will eventually be on it.

Let's say the city has a 10 year loan at 1% interest, the total cost the city would incur over the ten years is 3.6 million dollars. The development itself, under the assumption that it has identical taxes to similar recent developments by Activa will be $941.17 a year to the city, over the 10 years the townhomes will only produce taxes worth 1.43 million assuming 1% inflation (not reality but for simplicities sake). Now sure 1198 also has apartments on it so including those into it with the same rate as the townhomes one gets 5.1 million assuming the same things.

However sure you will have an excess in this case of 1.5 million but keep in mind that you now have to fund everything else in the city that tax dollars are normally used for over that same ten years with 3.6 million less. Without increasing taxes you can't make the math work, are we okay with cutting fire services? Community Centres? KPL? Winter works? Road Maintenance (pothole repairs, reconstructions, line painting, preemptive maintenance)? 

Sure my example is assuming the city takes on servicing of new roads (unlikely even if DCs are removed but you never know what the developer buddies of Ford want) but projects like the Strasburg Road extension or Middle Strasburg Trunk Sanitary Sewer are required for those new developments and were funded via DCs in the realm of millions of dollars. You'll get the same exact issue I mentioned before if we don't increase taxes.

The reality is you either pay DCs or increase taxes, the math doesn't allow for removal of DCs and no increase in taxes especially if we want the same level of service currently provided. Now we could change the way cities are designed to promote significantly more density and stop building endless suburbia but that wouldn't go over well with the vast majority of the populace.

DC's don't go to repairs of existing infrastructure, you use your tax dollars to pay for what DCs pay without increasing taxes and you will spiral into a maintenance disaster.

I mean, this isn’t true. Sure, on paper they’re not supposed to but when you have to repabe Fischer Hallman and also widen it then all of a sudden it’s an “upgrade” well then most major capital projects are “upgrades” not maintenance.

Except that isn't true.

If a road is purely being redone for the fact that it is old sure it would be an incorrect time to use DCs to fund the project, however if the road is being redone to allow for upgrades to underground infrastructure (Storm/Sanitary/Water) to allow for capacity upgrades for development it is a completely reasonable action to use DCs.

Fischer Hallman for example is being upgraded to allow for development, hence it is a completely reasonable use of DCs. The development along Fischer Hallman could not have happened without the services being expanded to the area. Hence DCs could be used given that the project is an expansion of existing infrastructure.

Here's a little bit from the NoC for the EA "Construct new storm sewers, sanitary sewers and watermain beneath Fischer-Hallman Road to facilitate the road widening and servicing of adjacent development lands" and "Construct new Grand River Transit bus stop pads and landings, and a new on-street transit bus bays behind the curb and gutter on the west side of Fischer-Hallman Road between Huron Road and planned Street 1 designed to accommodate future IXpress transit service".

Are you saying that you can't use DCs for this project given that it is literally being done to accommodate development?

How about Bleams Rd? It was widened to accommodate traffic loading from the residential developments within Rosenberg, it also includes a watermain (Raw) which transfers water from the Manitou pumping station to Manheim for treatment, this is being done to accommodate the future water demands of the Region (DCs).

River Road Extension? Funded through DCs.

As per the Development Charges act none of the road reconstruction projects are being done in a manner that doesn't allow for DCs to be used. Section 5 is what you will be looking for in terms of what can be used, the most critical point is Section 5 (3) "Costs to acquire, lease, construct or improve facilities including, i.  rolling stock with an estimated useful life of seven years or more, ii.  furniture and equipment, other than computer equipment, and iii.  materials acquired for circulation, reference or information purposes by a board within the meaning of the Public Libraries Act."

Thus under the DC Act every road widening is allowed to be included provided it improves a facility, obviously it is a loose definition but in Section 2(4) of the DC Act you also have a more explict mention of what can be used which includes Water/Wastewater/Storm Sewer upgrades. Then Section 5 (4) "must not include an increase that would result in the level of service exceeding the average level of that service provided in the municipality over the 15-year period immediately preceding the preparation of the background study".

[dtkvictim]

So, there really are multiple costs, and there is a gradation of grey in the middle.

• Dedicated new infrastructure (site servicing, as noted by ZEBuilder)
  
• Road extensions to the new site (when needed)--not quote dedicated, but maybe not otherwise needed
  
• Road widening (as noted by Dan), probably needed for the incremental traffic volumes--but repaving the rest of the road isn't really new infrastructure
  
• New facilities (parks, libraries, fire stations, recreation facilities etc) to support increased population: these are rarely dedicated, but maybe a big 500-unit suburban development needs 0.02 of a fire station and a 0.01 of a new library location, for example, so funds should be accrued for such infrastructure, too.
  

Kodra24 suggests reducing development charges and that would indeed help the (new) housing prices. But where should the funds come for the above costs? The cities really only have two levers: property taxes and development charges. And the provincial government is not rushing in to help ...

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.

[tomh009]

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.)

[Kodra24]

Why don't municipalities simply lower development charges seeing as Toronto DC's have risen 900% since 2010? Easy way to spur development and add housing stock

Yes ... but the money for infrastructure needs to come from somewhere, either development fees or property taxes. Or improved provincial funding (oops, fell off my chair, have to stop laughing so hard).

Well I guess my question then is how did it all seem to work prior to the massive increases by the municipalities? Why did many of them raise the DC's so aggressively? Was it because they could? Seems short sighted

I do not think the taxpayer or howeowner in this case should foot the bill

Has anyone ever brought up auditing the municipalities - we need accountability and fiscal restraint now more than ever

[Kodra24]

Could the city borrow to pay for new infrastructure and then use the new tax dollars derived from these new developments to pay down the loan? Does the math work?

The new infrastructure that DC's pay for are things like arterial road extensions (Strasburg Road), new amenities for an area (Southwest Kitchener Park) or upgrades (Sanitary Pumping Stations, Strasburg Trunk Sanitary Sewer). Sure the city could finance it through debt but the reality is you would need costs to be cut elsewhere within the budget if you were to take on those costs. Assuming we are living in an environment where we aren't increasing taxes to fund these. Now if we are getting rid of DCs for new subdivisions are we assuming the road infrastructure is now funded by the city as well and not the developer? In the current set up that is also funded by the developer to the tunes of millions.

Take for example Activa's 1198 Fischer Hallman Road site, so far site grading and servicing has occurred (Activa has paid for all of it), now lets assume the servicing cost is incurred by the city, the city would have to magically come up with the 3.4 million dollars to cover the costs to service the site for the 511 units that will eventually be on it.

Let's say the city has a 10 year loan at 1% interest, the total cost the city would incur over the ten years is 3.6 million dollars. The development itself, under the assumption that it has identical taxes to similar recent developments by Activa will be $941.17 a year to the city, over the 10 years the townhomes will only produce taxes worth 1.43 million assuming 1% inflation (not reality but for simplicities sake). Now sure 1198 also has apartments on it so including those into it with the same rate as the townhomes one gets 5.1 million assuming the same things.

However sure you will have an excess in this case of 1.5 million but keep in mind that you now have to fund everything else in the city that tax dollars are normally used for over that same ten years with 3.6 million less. Without increasing taxes you can't make the math work, are we okay with cutting fire services? Community Centres? KPL? Winter works? Road Maintenance (pothole repairs, reconstructions, line painting, preemptive maintenance)? 

Sure my example is assuming the city takes on servicing of new roads (unlikely even if DCs are removed but you never know what the developer buddies of Ford want) but projects like the Strasburg Road extension or Middle Strasburg Trunk Sanitary Sewer are required for those new developments and were funded via DCs in the realm of millions of dollars. You'll get the same exact issue I mentioned before if we don't increase taxes.

The reality is you either pay DCs or increase taxes, the math doesn't allow for removal of DCs and no increase in taxes especially if we want the same level of service currently provided. Now we could change the way cities are designed to promote significantly more density and stop building endless suburbia but that wouldn't go over well with the vast majority of the populace.

DC's don't go to repairs of existing infrastructure, you use your tax dollars to pay for what DCs pay without increasing taxes and you will spiral into a maintenance disaster.

This is an interesting point that you made that I wholeheartedly agree with - could the municipality incentivize infill developments vs disincentivizing suburban ones? Would that even work?

[ZEBuilder]

The new infrastructure that DC's pay for are things like arterial road extensions (Strasburg Road), new amenities for an area (Southwest Kitchener Park) or upgrades (Sanitary Pumping Stations, Strasburg Trunk Sanitary Sewer). Sure the city could finance it through debt but the reality is you would need costs to be cut elsewhere within the budget if you were to take on those costs. Assuming we are living in an environment where we aren't increasing taxes to fund these. Now if we are getting rid of DCs for new subdivisions are we assuming the road infrastructure is now funded by the city as well and not the developer? In the current set up that is also funded by the developer to the tunes of millions.

Take for example Activa's 1198 Fischer Hallman Road site, so far site grading and servicing has occurred (Activa has paid for all of it), now lets assume the servicing cost is incurred by the city, the city would have to magically come up with the 3.4 million dollars to cover the costs to service the site for the 511 units that will eventually be on it.

Let's say the city has a 10 year loan at 1% interest, the total cost the city would incur over the ten years is 3.6 million dollars. The development itself, under the assumption that it has identical taxes to similar recent developments by Activa will be $941.17 a year to the city, over the 10 years the townhomes will only produce taxes worth 1.43 million assuming 1% inflation (not reality but for simplicities sake). Now sure 1198 also has apartments on it so including those into it with the same rate as the townhomes one gets 5.1 million assuming the same things.

However sure you will have an excess in this case of 1.5 million but keep in mind that you now have to fund everything else in the city that tax dollars are normally used for over that same ten years with 3.6 million less. Without increasing taxes you can't make the math work, are we okay with cutting fire services? Community Centres? KPL? Winter works? Road Maintenance (pothole repairs, reconstructions, line painting, preemptive maintenance)? 

Sure my example is assuming the city takes on servicing of new roads (unlikely even if DCs are removed but you never know what the developer buddies of Ford want) but projects like the Strasburg Road extension or Middle Strasburg Trunk Sanitary Sewer are required for those new developments and were funded via DCs in the realm of millions of dollars. You'll get the same exact issue I mentioned before if we don't increase taxes.

The reality is you either pay DCs or increase taxes, the math doesn't allow for removal of DCs and no increase in taxes especially if we want the same level of service currently provided. Now we could change the way cities are designed to promote significantly more density and stop building endless suburbia but that wouldn't go over well with the vast majority of the populace.

DC's don't go to repairs of existing infrastructure, you use your tax dollars to pay for what DCs pay without increasing taxes and you will spiral into a maintenance disaster.

This is an interesting point that you made that I wholeheartedly agree with - could the municipality incentivize infill developments vs disincentivizing suburban ones? Would that even work?

In theory it would work and it has worked in the past, Kitchener dropped DCs downtown ending in 2019, I don't remember the exact date? They saw a flood of buildings come to the market however that can't be directly attributed to DCs being removed since they also saw the opening of the LRT, a housing market that wasn't in the ground, a growing tech economy, which really allowed for the perfect storm.

Hypothetically one could promote infill development over suburban sprawl, however zoning would have to be updated to reflect that. A SGA-1 zoning across the entire city would be a start with SGA-2 type zoning in other areas (strip malls, commercial hubs), this will be coming to some degree in the new OP. In the current environment it might make sense to build a 4 floor apartment but zoning makes that impossible so you need a ZBA and often times an OPA so it disincentives this type of development if you don't have deep pockets.

In this hypothetical situation you could then jack the DCs on suburban homes (SFH, not appropriate missing middle) and significantly decrease the DCs on infill development depending on FSR/new units. The issue you may run into in this case is development would be occuring in locations where it may not have been thought of in the last 30 years. The infrastructure (water mains/sanitary sewer) may not have the capacity to carry this new loading. So while it may make sense to decrease DCs in this hypothetically situation (infill case) one will still require them as infrastructure that is presently installed may not have been designed for the usage expected.

There's already locations in the sanitary system that are causing issues and are slowly being rectified (millions of dollars worth) but the minute you start adding infill development in locations where it hasn't been intended, you will without a doubt have more issues with infrastructure as the excess capacity is not enough to deal with the loadings expected. Ottawa was upgraded with new watermains for additional capacity, same thing is happening to Bleams (both are a mess of underground infrastructure for those interested). 

Hence you will need to get money from somewhere, are we going to increase taxes? That won't go over well. Hence DCs will inevitably remain but can be significantly reduced since you won't have to upgrade as much infrastructure, at least to the same extent as servicing a new subdivision.

Regardless you can't get rid of DCs, we can surely play around with them to incentives certain developments over another. However at the end of the day the costs will still go to the buyer, developers are not going to eat that cost, which doesn't solve the affordability issue that stemmed the last couple pages of discussion.