Off-site levy charges, subsidies up for talk

By Collin Gallant on October 18, 2018.

cgallant@medicinehatnews.com @CollinGallant

The rates charged to developers for servicing their projects could be nudged slightly higher overall next year, a city committee heard Wednesday, but a debate on how much taxpayers will cover is still to come.

Off-site levies are charged on new developments to help the city recover costs of running new roads, water and sewer (sanitary and storm) lines to the property lines of new subdivisions.

Those bare levy rates — based on factors like construction timing, inflation and budget estimates — are suggested to rise by about 0.5 per cent across the city for the next two years.

However, a long-standing program for the city to pay 40 per cent of the costs, as well as a newer plan to pay 90 per cent subsidy in priority areas, such as downtown and some commercial corridors, will also be debated before the end of the year.

The entire package has been the subject of hot debate in the business community since the bylaw’s last major revision in 2013. At that point, council voted to keep the subsidy in place, and has since extended the program twice.

It is set to eclipse in at the end of 2018.

“My personal preference is to keep it in place,” said committee vice-chair Jim Turner. “We have to remain competitive with rural areas (of Cypress County and Redcliff).”

Aside from the subsidy, the rate is set at different levels in specific zones or “nodes” throughout the city, with an umbrella rate for everywhere else.

A proposed rate adjustment calls for an overall increase of just 0.47 per cent, bringing the total average charge to $234,600 per hectare. That is about $1,090 per hectare, or $430 per acre, more than the current rate.

Specific rates in 12 of the 17 zones will fall or remain essentially flat, the largest in the downtown, Box Springs and Cimarron nodes.

In five mainly active residential areas of Ranchlands, Southlands and Canyon Creek, rates rise by about 5 per cent based on specific requirements.

“The rates themselves represent a very small change overall,” said development and infrastructure commissioner Stan Schwartzenberger.

“The primary change is the result of the construction (inflation) index, updating the staging plan and recalculating costs.”

Three of the four utility types that make up the calculation rose between 4 and 6.2 per cent when new project estimates were factored.

City analysts peg construction inflation at 3.21 per cent, but the overall increase is limited by timing changes to three substantial road projects.

Changes to the intersections at Kingsway Avenue and Spencer Street were set to happen next summer, but have been pushed off to 2021.

Further east, a scheduled 2019 upgrade to the joining of College Avenue and Kipling Street now won’t take place until 2025.

The long-discussed Southwest Connector between South Boundary Road and the Highway 3-light industrial area, which had been earmarked to take place in 2021, will be shelved for a further 10 years.

Those timelines put some of the costs past the 25-year planning period, which is covered in the bylaw.

The rate bylaw will be introduced at council’s Nov. 5 meeting, and will be subject to a public hearing later in the year.

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