REPORT TO GENERAL COMMITTEE – Finance and Administrative

 

 

 

 

 

TO:

Mayor and Members of Council

 

 

FROM:

Andy Taylor, Commissioner of Corporate Services

Jim Baird, Commissioner of Development Services

 

 

PREPARED BY:

Jennifer Nelson, Manager , Development Finance

 

 

DATE OF MEETING:

2006-02-06

 

 

SUBJECT:

2006 Development Charges Background Study

 

 

 

RECOMMENDATION:

That the report titled “2006 Development Charges Background Study” be received;

 

And That Hemson Consulting Ltd. be retained as the lead consultant to assist in the completion of the 2006 Development Charges Background Study at a cost not to exceed $80,000 inclusive of 7% GST ($74,775 exclusive of GST);

 

And That Council pre-approve the 2006 Capital Project “Development Charge Background Studies” in the amount of $150,000, to be funded $135,000 or 90% from Development Charge Administrative Capital Growth Studies account, and $15,000 or 10% from tax funded sources;

 

And That Council pre-approve the 2006 Capital Project “Town Wide Studies” in the amount of $120,000, to be funded from Development Charges Town Wide Hard account;

 

And that the balance of the funds in the two capital projects be used to retain any Planning and Engineering consultants and land appraisers on a preferred supplier basis, as required, to support the Development Charge Background Study.

 

 

PURPOSE:

The purpose of this report is to seek approval to hire Hemson Consulting Ltd as the lead consultant to assist with the completion of the 2006 Development Charges Background Study.

 

 

BACKGROUND:

The Development Charges Act, 1997 (DCA) and its associated regulation (O. Reg. 82/98) provide the basis for municipalities to recover growth related capital costs from new development.  The authority of the Act is used by the majority of municipalities in the Province to pass by-laws governing the application of development charges to new development.

 

The Town enacted its current development charges by-laws on August 31, 2004 (Town Wide Hard, Town Wide Soft and 26 Area Specific By-Laws).  The by-laws have a five year term (the maximum allowed under the DCA), which wouldn’t require the Town to prepare a new Development Charges Background Study until 2008.  Throughout 2005, the Town experienced higher than expected costs for hard services, and also identified new growth related projects that were not considered in the previous DC Background Study.  To ensure maximum recovery of growth related costs, Staff recommends that a DC Background Study be undertaken in 2006 for hard services (Town Wide Hard and Area Specific) with the anticipation of new by-laws being enacted in June 2006.

 

The Development Charges Background Study will involve:

–        A review of the Town’s existing policies and practices;

–        Applying a methodology for calculating development charges which is consistent with the Development Charges Act;

–        Collection and analysis of various data necessary to calculate new development charges;

–        Preparation of a well documented background study;

–        Conducting public consultation meetings and the statutory public meeting prior to by-law enactment

 

The primary objective is to provide a well-documented development charges background study and defensible development charges by-laws that are consistent with the requirements of the Development Charges Act.

 

OPTIONS/DISCUSSION:

The 1999 and 2004 Development Charges Background Study was completed with the assistance of Hemson Consulting Ltd.  The study update will be completed using a similar structure and process to that which was used in the past.

 

The appointment of Hemson Consulting Ltd. to assist again in the completion of the study will enable the Town to produce a high quality, defensible development charges policy in a cost effective manner due to Hemson Consulting Ltd’s knowledge and experience with Markham’s development charges and the firm’s good reputation with the development industry in Markham.

 

For the reasons above, it is recommended that Hemson Consulting Ltd. be retained as the lead consultant to assist in the completion of the 2006 Development Charges Background Study.

 

The Engineering and Planning Departments will each be required to provide a significant amount of input into the Study.  Planning Department staff will be required to update the estimates of dwelling units, population, employment, developed and developable land for a number of historical and horizon years for the Town as a whole, for the urban and rural areas and for each area specific development charge area.  At the time the 2004 Development Charge Background Study was prepared, the Town did not fully understand the impact of the sewer and water constraints.  As that information is now known, the necessary adjustments can be made to the growth projections.

 

The Engineering Department must review all projects that are currently included in the Town Wide and Area Specific Development Charges, add new projects, update construction cost estimates, and update property requirements and costs.  The Engineering Department may also be required to update various studies to support the projected levels of development included in the Development Charges.

 

As it is in the Town’s best interest to update the Development Charge Background Study in a timely manner, it is recommended that Planning and Engineering retain the same consultants that were used in 2004 to ensure continuity.  This conforms to the Purchasing By-Law.

 

FINANCIAL CONSIDERATIONS:

It is recommended that Hemson Consulting Ltd. be retained as the lead consultant to assist in the completion of the 2006 Development Charges Background Study at a cost not to exceed $80,000 inclusive of 7% GST ($74,775 exclusive of GST).

 

The Hemson Consulting Ltd. work will be funded from the 2006 capital project “Development Charges Studies” in the amount of $150,000.  The funding of this project will be 90% or $135,000 from the Development Charges Administration Capital Growth Studies account and 10% or $15,000 from tax funded sources.

 

The balance of the funds in the capital project will be used to fund any other Planning and Legal consulting work that may be required to support the Development Charges Background Study.

 

The various engineering studies required to support the Development Charges Background Study will be funded from the 2006 capital project “Town Wide Studies” in the amount of $120,000.  The funding of this project will be 100% Development Charges Town Wide Hard account.

 

 

ENVIRONMENTAL CONSIDERATIONS:

Not Applicable

 

 

ACCESSIBILITY CONSIDERATIONS:

Not Applicable

 

 

ENGAGE 21ST CONSIDERATIONS:

Not Applicable

 

 

 

 

 

 

 

 

 

BUSINESS UNITS CONSULTED AND AFFECTED:

No other business units were consulted.

 

 

 

 

 

 

 

Barb Cribbett, Treasurer

 

Andy Taylor, Commissioner, Corporate Services

 

 

 

 

 

 

Jim Baird, Commissioner, Development Services