Construction community concerned about revamped development charges

Karen Hansen from Pratt Homes says she’s ‘never seen a DC bylaw rushed through so quickly’; Developers ask for more time to review data
 by: Raymond Bowe

As the city works toward an overhaul of its development charges, people in the construction community are hammering home concerns that the process is moving too quickly and mistakes could be made. 

While massive growth is just over the horizon in Barrie, the public and city council got a look at the new list of development charges during a mandatory public meeting held Monday night at Barrie City Hall.

The municipal fees are charged to developers to recoup infrastructure costs associated with both residential and non-residential growth, such as internal roads, sewers, watermains, roads, sidewalks and streetlights.

“Those are deemed a local service and are the direct responsibility of the developing land owner,” said Gary Scandlan, from Mississauga-based Watson and Associates, who made the presention during general committee.

Scandlan explained how the proposed development charges (DCs) were calculated, talked about the background study, which was released April 17, and provided an overview of the proposed new development charge bylaw. 

The existing bylaw expires Aug. 26. A staff report is expected May 27 with council possibly considering the new bylaw June 17. 

There’s a minimum 60-day window between when the background study is made public and the first day that city council can consider the new bylaw, Scandlan said. 

“The bottom line is the province wants to ensure that there’s clarity in the charges and the costs that are borne directly by the developing landowners,” he added. 

A handful of people from the construction industry raised concerns on Monday night. 

Karen Hansen, who, with her husband, owns and operates Pratt Homes, which has been building homes in Barrie for six generations, says council needs to slow down before implementing the new development charges. 

“During my own generation, I’ve never seen a DC bylaw rushed through so quickly,” said Hansen, who has asked for more time for the development community to crunch the numbers. “After all, mistakes can be made. … This will affect the purchase price on homes and the rent on rental projects for the next four years.”

She said a preliminary review has revealed “many mistakes in the new bylaw, and we’ve only skimmed the surface.”

Hansen, who’s been an advocate for affordable housing in Barrie for several years, said the creation of affordable housing is “challenging” and there are “significant enemies,” such as the price of land, construction costs, condominium fees and development charges. 

“Affordable housing is a major problem in our city,” she said. “This problem exists for all of our residents on many levels, and it ranges from emergency shelter housing to affordable rental projects to the hopes and dreams or everyone who wants to buy a home.”

The development charges being proposed will only increase the cost of living in Barrie, Hansen said. 

“This is an important bylaw and we need to get this right,” she said. 

Mayor Jeff Lehman asked Scandlan why the highest increase was proposed in areas such as townhouse build forms, which are most often used for affordable housing. 

Scandlan said the calculations include factoring in the average occupancy. “That will be part of the increase,” he said.

Simcoe County Home Builders’ Association (SCHBA) president Peter Brewda also called for an extension to review the background study. 

“Our industry is essential to Simcoe County’s long-term economic strength and prosperity,” he said.

With the “sheer magnitude” of the proposed development charges, Brewda said it’s “disappointing” that the background information and estimated timeframe adoption is “inadequate and insufficient” to allow for a proper analysis.

“The dream of home ownership is slipping out of reach quickly for many Ontarians,” Brewda said. 

Robert Howe, representing the Salem Landowners’ Group, also called for more time. They’ve hired a consultant to look more closely at the DCs. Some of their concerns relate to “very significant increases” in captial costs associated with water, sewer and road projects.

Howe said he’d like to see more information and dig futher into the numbers. He said he’s “very concerned” there won’t be enough time to receive and analyze the data. Howe asked that the public consulation period be extended. 

City treasurer Craig Millar said he appreciates the challenges that come with “dissecting” the information, but added staff are available to work through it.

The population of Barrie is expected to reach over 230,000 in the coming years. By 2028, it’s predicted that 48,000 additional people (in 22,000 new residential units) will call Barrie their home, growing to almost 60,000 people (or 27,000 units) by 2031, and 100,000 new residents (or 31,000 units) by 2041. 

The number of low-density residences is expected to decease in favour of medium- and high-density developments up to 2040.

Most of that growth will take place in the south end, particularly the Salem and Hewitt’s secondary plan areas. Under the Barrie-Innisfil Boundary Adjustment Act, the city took in almost 5,700 acres of land from the Town of Innisfil, effective Jan. 1, 2010. 

The methodology behind determining the new development charges included identifying the amount, type and location of growth, as well as servicing needs to accommodate growth and capital costs to provide services to meet those needs.

The calculations include city-wide services related to a highway, public works facilities and fleet, transit, parking, parks and recreation, library, administration, paramedics, social housing, wastewater facilities and water services. New services added to the calculation include the airport, long-term care and waste diversion. There are also area-specific calculations, such as in the Salem and Hewitt areas, for water and wastewater services.

Under the current, it works out to about $42,000 for a single detached home. The majority of the costs include roads ($18,000), debt-related water services ($7,500), parks and recreation ($6,000), and wastewater services ($4,400). Homes located in the Salem and Hewitt’s area have an additional $5,700 in charges for wastewater collection services and water distribution systems. The DC costs lessen with more dense residential types. 

Under the proposed DC rates, those numbers increase to around $57,000 for a single detached home, as well as an additional $10,000 for water and wastewater in the Salem and Hewitt’s areas to be developed in the south end. 

There is also a set of proposed charges for non-residential uses, such as commercial and industrial.


Adjudication panellists urge parties to ‘pay up’ or face consequences

Panellists presiding over a recent Osgoode Professional Development session on the repercussions of Ontario’s new construction adjudication system had a simple message for parties who might end up on the losing end of disputes: unless you are ready to deal with all sorts of troublesome consequences, just pay up.

Construction lawyers James Little and Bruce Reynolds, both of Singleton Urquhart Reynolds Vogel LLP, were assigned the panel topic What Happens After Adjudication? as part of Osgoode’s conference held in Toronto April 29.

The adjudication system, which will be implemented along with a prompt payment regime in the second phase of lien act reforms contained in the province’s new Construction Act, takes effect Oct.1.

Reynolds laid out a “world of pain” for debtors who have lost an adjudication that includes possible writs of seizure and sale under Rule 60, garnishments, writs of sequestration and possession, project suspension and a broad examination aid of execution.

“When the sheriff arrives in your reception area, it is not a good day,” said Reynolds, who with co-counsel Sharon Vogel wrote a report recommending the reforms. “Once we get to the point of the adjudication process where an unpaid subcontractor or general contractor files that determination because someone was stupid enough not to pay, they are entering a world of pain.”

Reynolds told the story of a small creditor who followed up on a claim using Rule 60 against a large firm that let the claim fall through the cracks. The large firm’s bank account ended up seized.

“There is going to be a theme as we move through these remedies and the theme is, if there is a determination, it is a really good idea to simply pay,” said Reynolds.

Reynolds said the new system is intended to re-engineer construction parties’ thinking around payment and dispute resolution. From a public policy perspective, he said, the re-engineering is to be accomplished by giving the winner in a dispute a “great big hammer” with which to enforce their rights and putting “serious pain” on a party who does not honour an adjudicator’s decision.

If adjudication works, the invocation of lien rights may well decline

— Bruce Reynolds

Singleton Urquhart Reynolds Vogel LLP

The right to suspend work on a job arises only 10 days after a losing party in an adjudication fails to pay up, Little noted, and interest accrues at a rate of two per cent per day. There are also drastic default measures, with failure to pay following an adjudicator’s decision potentially deemed a breach of contract.

Little went through legal precedents established in the U.K., whose 20-year-old adjudication system Ontario’s is most closely modelled after. The Balfour Beatty and Macob cases may well carry weight as jurisprudence develops in the province, said Little.

The courts determined in Macob that the purpose of the adjudication process was to establish a speedy mechanism for resolving disputes in construction contracts. Because their parliament did not abolish arbitration and litigation, it was seen as a signal that the new system should render quick justice, Little explained.

The point was expanded upon in Balfour Beatty, he said.

“One of the key principles they discussed was that the need to have the right answer in adjudication has been subordinated by the need to have the answer quickly,” noted Little. “So parties can get their rough justice.”

Reynolds commented that the adoption of adjudication in the U.K. resulted in a “massive offtake” of other remedies, and he expects that to happen in Ontario.

“If adjudication works, the invocation of lien rights may well decline in the next three to five years to the point where lien rights are seldom resorted to,” he said.

Wrapping up, Reynolds offered recommendations on best practices. First of all, he said, choose the right adjudicator.

“We suggest that is a horses for courses decision,” said Reynolds. “What is the monetary amount in dispute, what is the degree of complexity.”

Then, make sure someone on staff knows the new procedures and can hit the ground running when a notice of adjudication is served.

“For us, the single most important thing is to be prepared,” Reynolds said, noting Attorney General Caroline Mulroney has said there would be no postponement of the launch.

“It is not going to be deferred so get your running shoes on,” said Reynolds, who then referred to the 30-day period an adjudication is legislated to take.

“Thirty days can go by in a blink of an eye. And that has implications for proper documents and record keeping being introduced as a matter of ordinary course, because developing an analysis on the fly is much more difficult if you have incomplete documents.”

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One-size-fits-all approach in face of rapid growth doesn’t work, writes Joe Vaccaro, CEO of the Ontario Home Builders’ Association

The arrival on Jan. 1, 2019 of a regulation mandating sprinklers in care facilities suggests the province is moving in the right direction, said veteran fire chief Ralph Dominelli.

Simply put, taking a one-size-fits-all provincial approach to local community planning just doesn’t work.

Listening and understanding this, the Ontario government, through Municipal Affairs and Housing Minister Steve Clark, released its Housing Supply Action Plan on May 2, along with updates to the Growth Plan. This government has vision and a goal to see more homes built and more choice in the type of homes built for Ontarians.

Our industry has long said we need to build more homes to support the forecast in population and employment over the next 20 years. Today, over nine million people live in the Greater Golden Horseshoe and by 2041, a projected 13.5 million will call this region home, along with almost two million more jobs. This is real growth that we need to plan for if we ever want to improve affordability for homebuyers.


The plan will guide the future type and location of new housing supply across Ontario. It will need to be supported by investment in transit and complemented by municipal plans.

Despite what some may say, this plan will continue to protect the Greenbelt along with environmentally-significance features.

The plan will also immediately get to work to unlock the 100,000 housing units stuck in the appeals backlog and that means we can get shovels in the ground for homebuyers across the province.

This is a comprehensive plan that aligns many of the provincial ministries that work to bring new housing to our communities. Doing this will reduce red tape and streamline the approvals process, which will make costs and timelines more predictable and get more homes built and renovated across Ontario.

The Housing Supply Action Plan is a transformative plan that will get Ontario out of the never-ending cycle of planning and into building more homes and providing more choice to homebuyers across Ontario.

— Joe Vaccaro is CEO of the Ontario Home Builders’ Association


Ontario housing plan will help affordability, rental market

A provincial government plan to boost supply in Ontario has been welcomed by the body representing the province’s builders.

The Residential Construction Council of Ontario (RESCON) says that the Ontario Housing Supply Action Plan paves a pathway to start patching up the province’s “shattered housing system and failed policies of the past.”

The plan involves a suite of legislative changes to increase the supply of housing that is affordable and provide families with more meaningful choices on where to live, work and raise their families.

“We’ve heard loud and clear from families across Ontario that finding housing that is affordable takes too long and costs too much,” said Steve Clark, Minister of Municipal Affairs and Housing. “After years of neglect by the former government, there is now a housing crisis in Ontario and the dream of ownership is out of reach for too many. Our plan will make it easier to build the right type of homes in the right places, giving Ontarians and their families more flexibility when looking for a home they can afford.”

He added that the program will help first-time homebuyers and those seeking affordable rental homes.

RESCON president Richard Lyall believes the plan will make a significant difference.

“Bringing more supply to the market will ultimately help desperately needed affordability and housing choices, including the missing middle. It will also open up the province’s broken rental market,” he said.

Specifically, he says it should:

1. Cut red tape to make it easier to build the right types of housing in the right places.
2. Make housing more affordable through increased supply.
3. Help taxpayers keep more of their hard-earned dollars.

“Delays, duplication and red tape were choking supply, raising costs and hurting young families,” added Lyall. “The government’s Action Plan will make projects more predictable to do business, lower risk, and increase investment and jobs.”