York Region faces $1.9B in lost fees, increased costs as Ontario pushes ahead with housing strategy

An influx of 15,000 residents near Newmarket among the unanticipated strains on region's infrastructure

Yorkregion.com
June 23, 2023
Kim Zarzour

About 15,000 new residents are expected to settle in the next few years on the border of Newmarket and King Township.

Where will they drive? Shop? Find medical services, public transit or recreation?

Who will pay for the roads, waste and water infrastructure to support them?

Those are the kinds of questions being asked by York Region councillors as they grapple with sped-up development following moves by the provincial government.

The region received a staff report June 15 outlining how recent policy and legislative changes from the province will impact development and finances in York Region.

By opening up the greenbelt and Oak Ridges moraine to development, deciding against the Upper York Sewage Solution and removing some of the charges developers previously paid for the growth, the province has left York Region in a bind: how it will pay to serve 330 hectares of additional lands not contemplated in master plans or 10-year capital plans?

One of the areas soon to be transformed is the previously protected, environmentally sensitive lands near Bathurst and Green Lane which chief administrative officer Bruce Macgregor estimates could see an influx of 15,000 residents.

Newmarket Mayor John Taylor predicted a significant impact on his town.

“I think there’s going to be a lot of people surprised to hear that figure. I certainly am. That’s as if it’s a small town on the edge of Newmarket.”

In its mid-year update of the 2023 Fiscal Strategy, a staff report explored ways to provide for this new demand for infrastructure without jeopardizing the region’s financial health.

The report outlined challenges that could impact long-term financial sustainability as well as tools for addressing shortfalls in development charge collections lost as a result of Bill 23.

The region now estimates Bill 23, the More Homes Built Faster Act, 2022, could cost York $1.9 billion over the next ten years.

While the Ford government promised to “make whole” regions that can no longer collect the usual charges from developers to pay for growth, to date, there has been no firm funding commitment from the province.

Without that commitment, the region must develop its own strategy to make up the shortfall with funding from other sources, including potential tax levy and user rate increases,

Beyond the loss of development charges, the region faces further financial pressure as a result of provincial moves, including the loss of the Upper York Sewage Solutions project (requiring a new system and fewer opportunities to phase in), conversion of formerly protected areas into development lands, and unplanned or advanced growth via Minister’s Zoning Orders (MZOs).

Since 2021, the use of MZOs has increased, with 26 being issued for lands in York Region.

Among the suggestions raised by staff to retain the region’s AAA credit rating is a short-term fix, where developers can pay in advance through a prepaid Development Charge Credit Policy to advance infrastructure that is not in Regional Plans.

The region has been meeting frequently with the province and there’s growing awareness of the complexity and cost, said commissioner of public works Erin Mahoney.

“There’s definitely a lot more work that needs to be done to finalize the infrastructure implications of these recent provincial changes,” she said.