By Sylene Argent, Local Journalism Initiative Reporter, Essex Free Press
Members of Essex County Council received a Development Charges (DC) report as information during the April 2 meeting, which provided a study-draft data table and outlined next steps in the process of implementing a DC By-Law.
All seven local municipalities have their own Development Charges By-Law, which is imposed on developers to pay for growth-related capital costs. In the County’s case, that would include roads, EMS, and long-term care. The County currently does not have these charges in place, nor has it ever.
The calculated residential Development Charges for the County of Essex was presented through the report as $12,998 per single-detached residential unit, $7871 for rows and multiple-unit dwellings, and $6917 for other residential units. For non-residential, proposed Development Charges are $46.50 per square meter for commercial/institutional.
This is the max amount allowable. County Council can choose to go lower.
County Council was provided the information, but will have to decide whether or not to approve DCs at the County-level in the future.
The information shared during the meeting and the Background Study that will be made public two-weeks after the meeting have to go through a legislated public evaluation process before County Council makes the decision to enact a by-law on the matter.
At the County-level historically, growth has been funded through the tax levy on a “pay-as-you-go-basis,” Director of Financial Services/Treasure, Melissa Ryan, explained.
“Given that growth in our region has traditionally been stable and manageable, this approach has served us well,” Ryan told members of County Council. Currently, however, “growth is coming faster and at a higher cost than ever before.”
To ensure the County does not place an unsustainable burden on the tax rate, Ryan said tools needed to be explored, and Development Charges are tools the province expects municipalities to use before expecting financial support.
As the County continues to grow, it is important to ensure the necessary infrastructure is in place to support it, Ryan added.
“Development Charges help ensure new growth contributes its fair share [rather] than placing the entre burden on existing taxpayers.”
The Report to County Council Ryan prepared on the matter notes the Development Charges Background Study will be released on April 15, 2025, two-weeks after the presentation of the data tables to Council. The comprehensive DC study will provide a detailed analysis supporting the proposed Development Charges and will include key components, such as the development forecast, calculated development charges, long-term capital and operating cost analysis, and the asset management plan.
A tentative meeting with local developers will take place April 30.
The background study has to be released 60-days prior to Council possibly passing the By-Law. It is anticipated Notice of By-law passage will be issued July 8, 2025.
In May of 2024, members of Essex County Council approved funding a Development Charges Study by utilizing up to a max of $60,000 from the Rate Stabilization Reserve, which Hemson Consulting Ltd. is undertaking. This firm provided an update to County Council in November.
Stefan Krzeczunowicz, Associate Partner of Hemson Consulting Ltd. noted DCs are imposed through a by-law, which has a minimum lifespan of ten-years.
Hemson has identified six items to which the County can reasonably impose a charge including highway, EMS, long-term care, waste diversion, public libraries, and studies related to the five services.
Krzeczunowicz explained to County Council the process in developing a DC study.
“This is a remarkable period of growth of the County,” he said, adding growth has accelerated in the County of Essex in recent years.
Krzeczunowicz highlighted there are more than 30,000 new residents, over 11,300 new homes, and 14,700 more jobs since 2010.
In addition, he said there has been a shift to higher-density housing, and more medium density row housing and apartment dwellings are being constructed.
Information he shared noted that in the past decade, 68% of housing has been for singles and semis, nine-percent for row, and 22% for apartments.
Current County population is 211,980, and is expected to grow to 258,400 by 2041, Krzeczunowicz said.
It is not enough to collect DCs on a theoretical funding cap, he explained. The legislation requires if DCs are to be collected, they must be for projects that have been previously identified and reflect Council’s reflections to expand services moving forward.
Currently, the developers pay for a municipal DC when pulling a building permit at one of the seven local municipalities. If the County proceeds with its own DC, the developer would pay that charge as well.
If the County chose to implement the maximum DC on residential, the total charge for a single-detached unit, for instance, including the municipal DC, would be $48,113 in the McGregor service area and $38,176 for the Harrow Service Area in the Town of Essex.
In terms of non-residential, if the County chose to implement the maximum DC, the total charge including the municipal DC, the total would be $67.92, in the McGregor service area and $70.18 for the Harrow Service Area per square meter in the Town of Essex.
The total DC would vary as each municipality has its own rate.
He also highlighted statutory exemptions/discounts, which includes municipalities and local boards, residential additions and secondary suites, industrial enlargements, replacement dwellings, affordable housing and non-profit housing, and rental housing discounts.
After Krzeczunowicz’s presentation, County Council was able to ask questions on the matter.
In answering Kingsville Deputy Mayor Kim DeYong’s question on how the maximum potential DCs were calculated, Krzeczunowicz explained that it has to do with the amount of cost the County will incur over a planning period divided by the amount of development projected to occur.
The charges can be indexed to inflation over the years of the by-law’s lifespan.
DeYong also wondered if new charges would hinder growth. Krzeczunowicz noted they do not factor in the impact of the charges that may or may not occur on the rate of projected development.
In answering Leamington Deputy Mayor Larry Verbeke’s question if the proposed DCs will affect the agriculture sector, Krzeczunowicz said that is up to Council. There is no statutory exemption for ag currently. It is common for municipalities in Southwestern Ontario to exempt those types of buildings. Council could consider that when drafting the by-law.
Essex Mayor Sherry Bondy would like to slow this process down to spend more time on public consultation.
“I think this is such a big discussion,” she noted, adding she would like to see a public open house in each of the seven local municipalities. “It is going to impact us all very much, and we should have the ability as local Councillors to be…in our municipality with our residents and with our developers.”
It would also provide a chance to explain what DCs are to the public.
Bondy is a proponent of growth paying for growth. She found the numbers presented to be high, and wondered about a phased-in approach. She would like to see lower rates for multiple-unit homes.
Krzeczunowicz noted with any phase-in or discount, the revenue shortfall cannot be made-up by a higher Development Charge at a later time or another type of development. The multi-residential rate could be discounted if there is desire.
LaSalle Mayor Crystal Meloche likes the idea that growth pays for growth, but she was concerned with the numbers presented as there is a housing crisis. She is interested in hearing from builders.
“I am afraid this will have a negative impact on the region,” Meloche said. She did like the one County-level DC for the entire County.
Tecumseh Deputy Mayor Joe Bachetti spoke of how if this was implemented 15-years ago, the fees that would have been recouped from development in that time would have gone towards road work.
When this matter was first presented, Lakeshore Deputy Mayor Kirk Walstedt had concerns, and this report had done nothing to alleviate them.
“I know the developers and builders will be upset, but in the end that will be passed on to…the buyers. What I guess troubles me is that at virtually every County Council meeting, we talk about affordable housing, how can we assist with that, what incentives can we provide, and other times we have given incentives. And here we are talking of adding an additional $13,000 onto homes. I don’t like it. To me, we are actually going backwards.”
That money is quite a number of mortgage payments for those getting in on the ground floor, Walstedt said, noting he would vote against taking this to the public.
Tecumseh Mayor Gary McNamara called the report timely and a long time coming.
County Council also supported Bondy’s motion to host public consultations in each of the seven municipalities and to fund that cost from the Rate Stabilization Reserve, in addition to Kingsville Mayor Dennis Rogers’s amendment to include Chatham-Kent DC rates for residential and non-residential as a comparator.
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