

TORONTO – Ontario municipalities are concerned that parts of the province’s new housing legislation may actually hamper growth and download excessive burdens to them and their taxpayers.
One aspect of a large bill introduced Tuesday by Municipal Affairs and Housing Minister Steve Clark would freeze, reduce and exempt fees developers pay in order to spur building.
Affordable housing, non-profit housing and inclusionary zoning units – meaning affordable housing in new developments – as well as some “attainable” units would be exempt from various charges.
But those fees go to municipalities to pay for services for residents of those homes, such as roads, community centres and transit.
The Association of Municipalities of Ontario said in a statement that the proposed changes “may contradict the goal of building more housing in the long term.”
“Unless fully offset by funding to support growth-related projects, reductions in these fees will shift the financial burden of growth-related infrastructure onto existing municipal taxpayers,” the association wrote.
Policy Update – Ontario’s Housing Supply Action Plan https://t.co/JjoTWFb9g9 pic.twitter.com/jwaZUYMaS0
— AMO (@AMOPolicy) October 26, 2022
Green party leader Mike Schreiner said the province needs to fund that lost revenue or it will be residents who have to foot the bill.
“If the province fails to step up to replace development charges they’re essentially calling for a tax increase on property taxpayers in this province,” he said after question period Wednesday.
“Municipalities are going to have to replace that revenue and really the only tool they have to replace it is to cut services or to raise property taxes.”
In response to a question from the NDP about it Wednesday, Clark said municipalities have $8 billion in development charge reserves.
“We’re going to continue to work with our municipal partners,” he said in question period. “We’re also going to work with the federal government on their $4-billion Housing Accelerator Fund. We think that would help municipalities as well.”
Ontario set to reduce developer charges to spur new home construction
Toronto Mayor John Tory said the removal of those development charges could cost the city hundreds of millions of dollars.
“What we can’t afford to see happen is to see one government make promises and pay for it with somebody else’s money,” Tory said at a press conference.
“These charges we collect are not just charges that go into the general revenue stream. They are charges that are specifically allocated to things that need to get built under the principle of growth paying for growth.”
Tory said he is supportive of “the thrust” of what the legislation seeks to do but is “very concerned” about the development charges aspect.
“We are in a position where we want to spur housing,” he said.
“(New buildings) have to have sewers to take away the wastewater. They have to have water to supply those buildings. They have to have roads and transit to connect those buildings up to the rest of the city and those were and are paid for in part by development charges.”
The Ontario Big City Mayors group said it welcomed the bill but wants the public comment period on regulatory changes extended to enable further discussion.
“There are some very positive things in here, and there are some items that will require further review, such as the impact of removing development charges,” Cam Guthrie, mayor of Guelph, and chair of OBCM said in a statement.
“We look forward to further discussions with Minister Clark and his colleagues on these matters before legislation is passed.”
The government’s housing plan is aimed at hitting a target of building 1.5 million homes in 10 years. It also proposes to allow more units on one residential lot, introduce more housing density near transit stations, reduce the property tax burden for multi-residential apartment buildings, and pursue rent-to-own programs.
“There are some very positive things in here, and there are some items that will require further review, such as the impact of removing development charges,” @CamGuthrie, mayor of Guelph, and chair of OBCM said in a statement. (2/3) https://t.co/FlNuKJO265
— Ontario’s Big City Mayors (@ONBigCityMayors) October 27, 2022
“We look forward to further discussions with Minister Clark and his colleagues on these matters before legislation is passed.” (3/3) https://t.co/CJkrgFPgGN
— Ontario’s Big City Mayors (@ONBigCityMayors) October 27, 2022
Ontarios new #Housing Supply Action Plan: some troubling features https://t.co/GRHeL6zw12
— AMO (@AMOPolicy) October 25, 2022
Our government is taking bold action to build 1.5 million homes over the next decade to put home ownership in reach for more Ontarians.
Thank you @TorontoRBOT for hosting @fordnation & I to discuss how #MoreHomesBuiltFaster will help us meet our goals. pic.twitter.com/JV4iu83JTi
— Steve Clark (@SteveClarkPC) October 27, 2022
Yesterday, Ontario introduced the More Homes Built Faster Act to address the province’s housing crisis.
If passed, it would ensure that cities, towns, & rural communities grow with a mix of housing types that meet the needs of Ontarians. https://t.co/Dz5lhpPaFY #onhousing pic.twitter.com/tZAld2H6mQ
— Ontario Housing (@housingON) October 26, 2022
The plan will help to build more attainable and market housing and provide a home for newcomers, young families, seniors and all Ontarians. pic.twitter.com/j5u5wS9LXx
— Ontario Housing (@housingON) October 25, 2022
The plan would protect new homebuyers by doubling the maximum penalties for builders and vendors who try to make extra money by cancelling a new home project or terminating a purchase agreement. pic.twitter.com/y76cmFEYJH
— Ontario Housing (@housingON) October 25, 2022
This report by The Canadian Press was first published Oct. 26, 2022.