REPORT #1,136: Development charges and urban intensification are difficult subjects to understand and their explanations are likely to quiet the most boisterous of parties. Yet these tools of managing civic growth are about to become of critical importance in the way London evolves.
Monday, Jan. 4, 2016 – LondonOntario
Among the dullest subjects in the world, one deemed surely to quiet the most boisterous of parties, is development charges. It has a fun-killer companion, I’ve since learned – urban intensification.
Even people at City Hall concede these are difficult subjects to explain, and it’s even harder to get the public truly exercised about them in the abstract.
Despite that, intensification – better known by its NIMBY moniker in-fill development – is about to become a significant force in the future of London. Coupled with development charges these two dullards represent how city council expects to pay for the rapid transit expansion – hybrid or otherwise.
Development charges, in case you’ve forgotten previous dissertations on the subject in this space, are fees the city tacks onto the cost of new construction. When you buy a new house, for example, about $26,000 of the total cost is a development charge.
This fee is used by the city to help fund expansion of services into new areas of growth. When a new subdivision opens ultimately it will require policing, fire protecting, public transit, a library branch, parks, maybe ultimately even a community centre. Funds paid into the development charges pot help cover those costs.
The rapid transit proposal currently favoured by council is a hybrid system. A portion – a route from Masonville to Western University and through the downtown to Fanshawe College – would be light rail. The remaining portion – from Oakridge through the downtown to White Oaks – would be fast buses.
Total cost: about $900 million. The city proposes to pay $125 million of that cost, and hopes to squeeze the rest from the provincial and federal governments. More about that sort of wishful thinking on another day.
The city’s share of $125 million would be raised, over the next 20 years, from development charges. But it’s the specific source of those development charges that makes all this interesting, and perhaps ultimately very controversial.
City planners believe rapid transit will encourage development along the two corridors. That development will come in the form of medium and high density residential and commercial development.
Tonight city council will take the first step towards making this happen. On the agenda is a recommendation from council’s planning and environment committee to raise the target for intensification projects to 40 per cent of all development. All you need to know about that number is (1) that it is higher than today; (2) it will mean more development pressure along major city traffic-ways that are touched by rapid transit in any form; (3) some members of council would like it to be even higher.
Hello Richmond Street, Western Road, Dundas Street, Oxford Street and Wellington Road.
Given the inability of previous councils to withstand the NIMBY anger of Old North, exactly how this will all play out is difficult to predict. However, council is also about to force itself into a corner by approving the London Plan as our new official plan – plan that would then essentially legislate higher density forms as the preferred development model for our future.
Without the hefty development charges that will be attached to higher density projects, the city will have trouble raising the $125 million it needs to fund its share of rapid transit.
Notwithstanding that, city council is moving to begin constructing the rapid transit infrastructure anyway in the expectation of those charges, thus trapping future councils into the same policy.
So here’s my first prediction for 2016: These may still be the dullest of subjects about which most of us understand little, but development charges and urban intensification are going to be very hot topics around cocktail hour as the year unfolds.
The McLeod Report on Radio
Weekday mornings, 9 – 10 a.m., radio station CJBK 1290. Call to comment 519-643-1290.