City of Pickering says it has lost nearly $1.9 million in development charges revenue loss due to Bill 23

Pickering calls on province to make municipality whole

Durhamregion.com
Sept. 8, 2023
Kristen Calis

In just seven months, the City of Pickering states it has lost nearly $1.9 million in development charges revenues as a result of the provincial government's Bill 23.

The More Homes Built Faster Act has eliminated development charges (DCs) on non-profit, affordable and select attainable homes, with reductions of up to 25 per cent for family-friendly, purpose-built rental units.

DCs pay for capital infrastructure, such as such as roads, transit and community centres.

In a report presented to Pickering’s executive committee on Tuesday, Sept. 5, city staff revealed that as of July 31, $1,881,639 of DC revenues have been lost due to the mandatory phase in of the DC fees as a result of the government's bill.

The city was required to reduce its DC fee set in its bylaw passed in July 2022 to 80 per cent of the maximum rate.

As of July 12 of this year, the city can now charge 85 per cent of the maximum DC fee. The city will be allowed to charge the maximum DC fee in July 2026.

The parks and recreation category has seen the largest financial loss in terms of lost revenue. For the first seven months of 2023, this category has lost $1,337,393 of DC revenues due to Bill 23, which equates to 71 per cent of the total loss.

The preliminary estimate for the 2024 DC loss is around $2.5 million.

Pickering is currently in a high-growth phase, and staff says it will continue to be in this phase over the next 10 to 15 years. The city is expected to hit a population target of 138,000 by 2032.

With high population growth comes higher demand for city growth-related infrastructure.

“The city has a very aggressive and correspondingly expensive capital forecast plan and requires every DC dollar to fund these growth projects,” the report says. “The city continues to hope that the province will make us ‘whole’ and assist the city in funding this critical revenue loss.”