Should developers help pay for community service infrastructure like libraries and fire halls in the new neighbourhoods they help create?
Currently the City of St. Albert charges offsite levies to developers that help defray the costs of building roads, water and wastewater infrastructure and other essential utility work.
However, the Municipal Government Act currently does not allow municipalities to make offsite levies for community service infrastructure such as new police stations or transit mandatory.
But that doesn’t preclude a voluntary-type levy system.
Inspired by a system established by the City of Calgary, Coun. Tim Osborne gave notice of motion at the March 21 council meeting that, if passed, would see a report created about the concept of voluntary levies for community service infrastructure.
“We’re growing all these new neighbourhoods, we’re bringing them on stream, and with new neighbourhoods comes a lot of pressure on the city,” Osborne said in an interview. “We see it in the demand for swimming, we see it in the demand for ice time. Right now all those costs are being obviously taken on by the city and I don’t know how sustainable that is.”
St. Albert used to have a recreation levy to help pay for capital projects that was charged to developers. The fee was reduced to zero in 2012 after an appeal court ruling that said under the Municipal Government Act municipalities could only collect levies for key infrastructure.
The act is currently under review, and the cities and towns of Alberta continue to lobby for some changes. But in the meantime, some communities are finding ways to work with developers to help pay for infrastructure like police stations, transit and recreation centres.
Osborne said he was inspired in part by some conversations he had with colleagues at a recent Federation of Canadian Municipalities meeting.
“I knew that Calgary had made some changes to the way they were doing offsite levies,” he said. They have a voluntary type payment for community service infrastructure.
“The main question I had when I saw that Calgary was doing this was, “OK but does anybody pay?” he said.
Apparently they do.
Kathy Dietrich, director of Calgary Growth Strategy, part of that city’s planning and development department, said Calgary’s new offsite levies were approved by council in January.
That includes what they call community services charges, almost $80,000 per hectare, to help pay to build facilities like fire halls, recreation and transit. Dietrich said the money all goes towards capital, not operating, costs.
“We came up with these amounts, and they are voluntary because we don’t have the ability to charge them. But they (developers) want these kind of facilities in the communities as much as we do, so we work together to create great communities together. So even though they’re voluntary I have never even heard of any developer not paying them,” she said.
Prior to the revised offsite levies, there was a council resolution in place to charge community service fees. The revision actually lowered these costs, Dietrich said, though other offsite levy charges increased.
As part of the process of implementing new offsite levies, Calgary worked closely with the industry, she said.
“But we worked really closely with our local industry here and we really engaged them in our processes, so we spent a year working with them on a very transparent process,” she said.
Osborne hasn’t yet reached out to St. Albert developers to see what they think of the idea. He said he sees that as part of the next step if his motion is successful and a report is to be drafted.
“Part of that would be a conversation with the development community to understand what’s realistic and what’s possible. But certainly the city’s being asked to front end projects like Project 9, and we’re taking a big leap to support some of the work and I just want to have a conversation about maybe a little bit of give and take,” Osborne said.
