Canada-Ontario Partnership to Build<\/a> will provide up to $8.8 billion in capital funding. The money is intended to support towns and cities that cut development charges on new residential construction by as much as 50 percent over the next three years.<\/p>\n\u201cFunding will be prioritized for municipalities that reduce and maintain reductions on development charges, which can add hundreds of thousands of dollars to the cost of a new home,\u201d an Ontario backgrounder reads.<\/p>\n
\u201cThis new infrastructure funding will offset much of the financial impact of DC reductions,\u201d it adds. \u201cHowever, municipalities will also be expected to support DC reductions, so that all three levels of government are supporting increased housing supply and affordability.\u201d<\/p>\n
A list of municipalities \u201cwhere DCs are seen as cost-prohibitive and where growth is essential to support Ontario\u2019s future\u201d will also be required to enact DC reductions, and it is not clear whether Stouffville will be included. Uncertainty therefore remains, making it difficult to assess local implications.<\/p>\n
For Lovatt, the initiative hinges on whether municipalities are fully compensated for lost revenue. Speaking at a town hall meeting on Monday night, he emphasized that DCs are the primary funding tool for growth-supportive infrastructure in communities like Stouffville.<\/p>\n
\u201cI believe there is probably going to be a 50 percent reduction in development charges on new homes, but how is that captured? How does that impact us?\u201d Lovatt said during the meeting. \u201cThe devil is in the details on these, and we don\u2019t know what the details are.\u201d<\/p>\n
The combined impact of eliminating sales taxes on new homes, alongside potential DC reductions, could lower costs by as much as $180,000 per unit, he said. Since the announcement, local interest from developers has increased.<\/p>\n
However, in Lovatt\u2019s view, any resulting cost burdens should not fall on property taxpayers. \u201cHow does the Town make up those funds for DC reductions? That\u2019s what we don\u2019t know,\u201d he said, reiterating municipalities\u2019 longstanding call to be \u201cmade whole\u201d when revenues are reduced by senior government policy changes.<\/p>\n
The Mayor also stressed that the framework needs to account for fiscal differences between municipalities. Larger cities, he noted, have historically charged higher DC rates and, in many cases, accumulated substantial reserves.<\/p>\n
\u201cA lot of municipalities, larger municipalities, who had very expensive development charges\u2026 padded up their reserves when they had the opportunity,\u201d he said. \u201cWe\u2019re talking hundreds of millions of dollars in reserves.\u201d<\/p>\n
Stouffville has maintained relatively lower rates to encourage development, resulting in more limited reserve growth. Lovatt pointed to Vaughan\u2019s recent decision to halve its DCs, drawing an important comparison: although its larger reserves make such reductions easier to absorb, Stouffville rates are still lower.<\/p>\n
\u201cNot all municipalities are created equal. We\u2019re not in the same position as Markham, Richmond Hill, or Vaughan,\u201d he explained. \u201cSo are we supposed to reduce ours in half and be a quarter of what Vaughan is? Council is going to have to weigh that out once we get the regulations.\u201d<\/p>\n
The Town\u2019s fire reserve was cited as an example, and Lovatt noted it carries a negative balance following the rebuild of Station 5-1 and the purchase of a new ladder truck. While day-to-day operating costs for departments like Fire and Emergency Services are covered by property taxes, DCs fund capital needs such as new stations and fleet expansion required to serve a growing population.<\/p>\n
\u201cIf we don\u2019t see development happen, we\u2019re not able to replenish that reserve,\u201d Lovatt said. That concern underscores the difficult balance municipalities must strike between encouraging growth through lower fees and ensuring adequate infrastructure funding, all without placing undue pressure on existing taxpayers.<\/p>\n
Concerns Extend Beyond Stouffville<\/p>\n
In an April 9 memorandum submitted to York Regional Council, Commissioner of Finance and Regional Treasurer Laura Mirabella outlined already-planned DC rate reductions of two to nine percent as part of York Region\u2019s 2026 by-law update. Those cuts were largely driven by previous legislative changes, and Mirabella highlighted other Council-approved DC deferral programs.<\/p>\n
Speaking during a Committee of the Whole meeting the same day, Richmond Hill Mayor David West said further reductions without compensation could undermine municipal interests.<\/p>\n
\u201cWe have reduced development charges already with all of the things that have happened since Bill 23,\u201d West said. He warned that continued cuts would \u201ceventually lead to the quality of the community potentially not being as high as people would expect it to be, and that\u2019s not helpful to anybody.\u201d<\/p>\n
West also cautioned against shifting more costs onto property tax roles, which places a heavier burden on residents who can least afford it. \u201cPutting more on property taxes, which is the most regressive tax that we pay, and less on other forms of taxation, which are far more fair, is actually making the affordability gap worse,\u201d he said.<\/p>\n
Newmarket Mayor John Taylor questioned whether reducing development charges would have any meaningful impact on housing supply. He referenced years of mandated changes aimed at lowering development costs and alleged municipal barriers while pointing to Ontario\u2019s still-struggling housing sector.<\/p>\n
\u201cIf this policy intervention is going to cost [billions of dollars], we should start off with some level of confidence that\u2026it\u2019s going to work,\u201d he said, warning that DC reductions without replacement revenue risk long-term fiscal sustainability. \u201cWe\u2019ve tried what, five, ten different interventions? We\u2019re not moving the markets.\u201d<\/p>\n
Regional Councillor Tom Vegh, also from Newmarket, questioned whether the reductions would translate to lower purchasing prices or greater profits for developers. \u201c\u200aI don\u2019t think it\u2019s going to move the needle on the cost of housing,\u201d he said. \u201cI think it\u2019s just a bit of a windfall for the development community.\u201d<\/p>\n
Markham Mayor Frank Scarpitti struck a more optimistic tone, describing the announcement as a potential opportunity provided funding commitments adequately match revenue losses. \u201c\u200aI\u2019ve stated very clearly\u2026 whatever you support us financially for infrastructure projects, we\u2019ll gladly reduce [DCs] the next day,\u201d he said.<\/p>\n
Scarpitti emphasized that cost recovery is essential: \u201cIt\u2019s gotta be dollar for dollar\u2026 If it\u2019s 25 cents on the dollar\u2026 the answer is \u2018Thanks, but no thanks.\u2019\u201d While speaking just for Markham, he suggested a possible openness to covering ten percent of resulting costs over the three-year period. However, in comments echoed by Taylor, Scarpitti also raised the threat of fiscal unsustainability.<\/p>\n
\u201cPeel Region, because they cut their development charges, has an outstanding liability of $1.3 billion,\u201d he explained, adding that there is no firm answer as to how the funds will be replaced. \u201cIf it\u2019s not replaced, it will mean taking out projects that they legitimately had recognized were going to be needed for growth\u2026 or some impact to property taxpayers.\u201d<\/p>\n
\u201cI certainly don\u2019t want to put [York Region] in that same position, and certainly not the City of Markham,\u201d Scarpitti added. \u201cI think there\u2019s a lot more answers that we need to get.\u201d<\/p>\n
Georgina Regional Councillor Naomi Davison also contested elements of the Canada-Ontario partnership, calling the proposed 50 percent reduction target \u201ccompletely arbitrary.\u201d She noted that development charges are based on detailed financial modelling tied to projected growth and infrastructure needs.<\/p>\n
\u201c\u200aWhen you look at the development charges, it\u2019s a mathematical calculation that takes a team of accountants to figure out,\u201d she said. Rather than imposing blanket cuts, Davison suggested senior governments could directly fund specific municipal projects, allowing local DC rates to be reduced.<\/p>\n
\u201cCutting DCs in half, all it does is charge the taxpayer more on their property taxes, which nobody wants,\u201d Davison added. \u201cSo I think the Province and the Feds have made the right decision to get in partnership\u2026and start funding us, but they should just pick projects\u2026and we\u2019ll adjust the development charges accordingly.\u201d<\/p>\n
While early details suggest municipalities will submit a list of applicable projects for funding, procedural timing remains unknown. The Association of Municipalities of Ontario (AMO) announced it will be working with the Ontario government as program regulations are finalized.<\/p>\n
\u201cIt\u2019s positive that there appears to be recognition that reduced municipal DCs need an offset from other levels of government,\u201d AMO wrote in a recent policy update. \u201cWe look forward to working with the Province to develop an equitable, efficient, and flexible program design that accounts for the diverse ways municipalities fund growth and use DCs.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"flag wire: true flag sponsored: false article_type: pubinfo.section: cms.site.custom.site_domain : thespec.com sWebsitePrimaryPublication : publications\/hamilton_spectator bHasMigratedAvatar : false firstAuthor.avatar…\n","protected":false},"author":2,"featured_media":8704,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[4871,4743,4669,94,61,4872,4668],"class_list":{"0":"post-8703","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-ottawa","8":"tag-4871","9":"tag-dc","10":"tag-lji","11":"tag-ontario","12":"tag-ottawa","13":"tag-reductions","14":"tag-spare_news"},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts\/8703","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/comments?post=8703"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts\/8703\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/media\/8704"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/media?parent=8703"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/categories?post=8703"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/tags?post=8703"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}