Pave paradise: $388M in city revenue at risk as Ford’s Bill 108 offers massive giveaways to developers

As one fire fizzles and dies, another is sparking to life.

Municipalities were given little time to celebrate this week after Premier Doug Ford’s decision to reverse a batch of sweeping cuts to essential municipal services funding, as the premier’s latest legislative effort, marketed as a solution to affordable housing woes across the province, has once again put city revenues at risk.

Bill 108, the More Homes, More Choices Act, 2019, an omnibus piece of legislation introduced by Ford and the governing PCs earlier this month, looks to reform Ontario’s land use planning and conservation regulations, under the pretext of making housing more affordable. The bill, introduced at Queen’s Park on May 2, could have sweeping impacts for development and land use planning policy in Ontario.

Reversing a move by the previous Liberal government, the PC bill reverts the new rules followed by the Local Planning Appeals Tribunal (LPAT) back to the controversial OMB-style process. The previous system was highly criticized for favouring developers and giving little weight to municipal decision-making power, two issues thought to be eliminated with the previous government’s introduction of the LPAT.

The bill took the municipal sector by surprise, with many critics questioning its clarity; wildlife advocates slamming potential changes to the Endangered Species Act that they say put animals and sensitive habitats at risk; and heritage advocates claiming the bill will limit the ability of municipal councils to protect local heritage assets.

The window to provide comments on the bill closes June 1. That prompted Brampton city staff to move quickly to provide insights to councillors.

During Wednesday’s committee of council meeting, it was clear that the bill, if passed in its current form, would have significant implications for Brampton. The bill carries risk for the city’s fiscal health and future plans. As the city attempts to modernize land use policies and decisions to become the diverse urban centre outlined in its 2040 Vision, Bill 108 and its policies that favour the development industry and sprawl could put that future in jeopardy.

“This government is making these very rapid changes back to what seems like the old way of doing business,” said Councillor Paul Vicente, noting the changes could have “very adverse” effects for Brampton.

City treasurer David Sutton highlighted potential financial impacts of the bill, which has already passed second reading at Queen’s Park.

In particular, the fees municipalities are able to levy on developers are to get sweeping alterations. Most significantly, municipalities will no longer be able to collect development charges for soft services, such as libraries and recreation facilities. For Brampton, this puts approximately $388 million of potential revenue at risk over the next 10 years and could pose issues for many capital projects. In 2019, 28 percent of the city’s capital budget is funded through development charges.

Charges cities will still be allowed to levy against developers, including for roads, public works infrastructure and transit, will no longer be collected upfront. Currently, municipalities construct needed infrastructure ahead of time to facilitate development, taking on the cost as debt, which is then eliminated as development moves forward and the charges are paid.

Instead, changes under Bill 108 propose that development charges be paid through six annual instalments, beginning after occupancy of the development.

“This presents cash-flow challenges to the city,” Sutton says.

Over the next decade, Brampton plans to collect nearly $2 billion in DC revenue for fire, transit, public works and roads infrastructure. However, under Bill 108, other sources of revenue may be necessary to make up the difference created by the new collection system. This means hiking taxes on property owners or taking on more debt, neither of which are rosy options.

This is particularly bad news for residential ratepayers in Peel Region, who have shouldered more and more of the tax burden in recent years because of sluggish growth in the commercial and industrial sectors.

These changes are part of Bill 108’s plan to roll together revenue collection tools for city planners into one new system called the Community Benefits Charge (CBC). Theoretically, it will allow municipalities to collect revenues to pay for growth, but Brampton staffers see the opposite, claiming the regulation actually contradicts the philosophy of “growth pays for growth.”

Few specifics are available in terms of rates and what municipalities will be able to charge under the CBC program. But with a cap being proposed, and the need to spend 60 percent of all CBC revenues within a year after they are received, Brampton staff worry that less money will be flowing to municipal coffers from development.

Bill 108 also puts at risk a key pillar of Brampton’s 2040 Vision. The plan envisions Brampton as the “vanguard” of the suburban green city movement, and many of the goals in the document place parkland and natural spaces at the forefront.

Under Bill 108, requirements for parkland in development are being drastically altered. Regardless of the size or density of a development, the bill requires 5 percent of the land to be set aside for designated parkland. This means that, hypothetically, people living in a 90-unit highrise condo building will be forced to make do with the same amount of green space as residents in a 25-unit townhouse development with the same footprint. Previously, as much as 0.4 hectares per 300 residential units, with a cap of 10 to 20 percent of the land area, could be applied to new builds. Alternatively, municipalities could take cash in lieu of parkland, meaning that, instead of creating green space, the developer could pay a sum to be used to provide other services.  

For Brampton residents, Bill 108 could mean a significant increase in tax bills to pay for development currently underway. This means that Brampton residents enjoying a municipal tax freeze in 2019 may find unwelcome news in their bills for 2020.

Brown says the effects of this legislation, which clearly favours the development industry, may not be noticed by residents right away.

“It’s essentially saying we’re going to give someone a favour, but the public is not going to see it until down the road,” he said.

Bill 108 is not the only evidence of Ford’s ongoing love affair with the development industry. Before he was elected, Ford was secretly videotaped in a secret meeting with developers, vowing to open up the provincially protected Greenbelt for development once he became premier. It was a promise he backpedaled on once the video footage was made public and created an uproar.

Since he’s been in office, however, in what can be seen as a back door to development on the Greenbelt, Ford has reopened study of the GTA West Corridor, a massive highway project running west from Vaughan through Caledon, then arcing southwest along the edge of Brampton on its way toward highways 401 and 407, a project that was previously scrapped by the Liberal government. The potential highway corridor, surrounded by land ripe for sprawling development, would skirt the edges of both the Greenbelt and the Oak Ridges Moraine.

Brown and council are now moving ahead with an effort to educate residents on what Bill 108 could mean for them. Similar public relations campaigns were planned when the potential elimination of water and wastewater DCs was on the table, and to protest the recently delayed cuts to municipal services.

Brown is confident that a strong public backlash could force the government to take a step back on the legislative changes.

Mayor Patrick Brown is set to fight a new developer-friendly bill proposed by the Ford PCs

“We’ve seen them walk down the autism cuts, we’ve seen them walk down the cuts to public health, to prisoner transport, to childcare; this is pretty significant,” he said.

The province will also have to contend with the Large Urban Mayors Caucus of Ontario (LUMCO), which, fresh off a successful campaign to reverse Ford’s municipal service cuts, is now taking aim at Bill 108.

“Ontario’s big city mayors are equally concerned about the proposed changes in Bill 108, which could put at risk our cities’ finances and ability to provide parkland, community facilities, and adequate public engagement to inform the planning of neighbourhoods,” reads a statement from Cam Guthrie, the mayor of Guelph and chair of LUMCO, who also called for further consultation and demanded that the deadline for comment be extended from June 1 to the end of September.

“We wholeheartedly support the province’s goals of improving access to different types of housing, including more affordable housing, but believe that by working together, we can find better ways to achieve them,” Guthrie’s statement said.

Brampton staff echoed the sentiments in the LUMCO statement and also joined the call to extend the consultation deadline. Council will also be sending an unnamed member of council to Queen’s Park to provide the city’s stance on the matter when the province opens up a committee hearing to listen to delegates.

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Twitter: @JoeljWittnebel