Sault Ste. Marie city staff are preparing to recommend increasing fees developers pay for parkland or cash-in-lieu, despite the city currently having no development charges for new builds.
Expanding Parkland Dedication Requirements
Prime Minister Mark Carney and Ontario Premier Doug Ford recently announced plans for reductions of up to 50 per cent in development charges across the province, aiming to improve housing supply and affordability. These reductions will be in place for three years, requiring support from all three levels of government.
Sault Ste. Marie is well-positioned to support these reductions, as the city does not currently levy development charges on new developments and offers incentives like tax rebates and direct financial support to builders.
However, Peter Tonazzo, the city’s director of planning, has indicated that city council will be asked to expand the requirement for developers to provide parkland or cash-in-lieu as a condition of development approvals. A report detailing the creation and implementation of a parkland dedication bylaw will be presented to council in the coming months, including a review of bylaws in other municipalities.
Parkland dedications are separate from development charges. Development charges cover infrastructure costs such as water, sewage, stormwater management, roads, transit, electrical services, waste management, emergency services, libraries, long-term care, public health, childcare, housing, and bylaw enforcement.
A federal government news release stated that development charges have become a “major hurdle in the housing market,” growing at an unsustainable rate and hindering new construction.
Currently, dedication rates in Sault Ste. Marie are capped at two per cent for commercial and industrial developments and five per cent for all other types of development. Cash-in-lieu values are determined the day before approvals are granted.
Tonazzo has not recommended implementing development charges in Sault Ste. Marie, but believes increasing revenue from parkland dedications is a viable option.
The city currently applies parkland requirements to new lot creation, but Tonazzo noted that the city doesn’t fully utilize the Planning Act’s provisions allowing for collection of land or cash for other development or redevelopment proposals, particularly when parkland hasn’t been previously collected or proposed developments are denser than previously approved.
Funds collected through cash-in-lieu must be deposited into a special parkland reserve account, with at least 60 per cent allocated or spent annually on park acquisition and development, or related capital costs. Operating costs are not eligible uses of these funds.
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