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0 & Associates
ECONOMISTS LTD.
Municipality of Lakeshore
Watson & Associates Economists Ltd.
905-272-3600
March 30, 2022 [email protected]
Table of Contents
Page
1. Tal icele [0 [ei iC): heres
ss DN = T~ (010 1010] 00 a
1.2 Existing Policies (RUICS) ...........cececeeeccececeeeeeeeeeeeeeeeeeeeeeeteteteeetetetetttetttteee O
1.3. Basis for the D.C. By-law Update ..............ccceeeceeceeceeeeeeeeeeeeeeeeeetetettetetetee O
1.4 Summary of the Process.............ccccececeeeeeeeeeeeeeeeeeeeeeeeeeeeeeteeeteteeeettetttettteees O
1.5 Policy Recommendations ................::cccccccccecceeeeeeeeeeeeeeeeeeeeeeseeeeeeeeesesesesssees 4
2. Changes to the D.C.A. Legislation ............:ccssssssseeeeeneenneneeneeeennneeeeeeeneneneeeeeeeeeee O
2.1 Bill 108 -- More Homes, More Choice Act, 2019 .........ccccccccceccceeeeeeeseeeseeees D
2.2 Bill 138 -- Plan to Build Ontario Together Act, 2019 ............cccccseeceeeeeeeeeeees O
2.3 Bill 197 - COVID-19 Economic Recovery Act, 2020.........::::ccccssseeeeeeeeeeeee
2.3.1 D.C. Related Changes «0.0.0.0... cceeeeseeeeeeeeeeeeeeeeeeeeeeeettttteteeeeeeaeeeee LD
2.3.2 Community Benefit Charges (C.B.C.) oo... eee B
2.3.3 Combined D.C. and C.B.C. Impacts ..............::ccccccseeeeeeeeeeeeeeeeeeee D
2.4 -- Bill 213 -- Better for People, Smarter for Business Act, 2020...................10
3. Anticipated Developme ntt.............ccccceceeeeeeeeeeeeeeeeeeeeneeeeeeeeeeeeseeeneeeeeeeeeeeeeseeeeeeee 11
3.1. Growth Forecast in 2020 D.C. Study 00... eeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee 11
4. Updates to the Municipality's D.C. Study .........cccccccceeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee V2
4.1 Wastewater ServiCes ...........ccccccccccccseeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeesessseesseeteeteeeees 12
4.2 D.C. By-law Revised Schedule of Charges..............::: eee TO
4.2.1 Updated D.C. Calculation (2020$) .............::cceeeeeeetteeetteteeeeeeeee 1D
4.2.2 Revised D.C. Rates (2020$ and 2022$) ..........ccccceccesseeeeessseeee 18
5. Updates to the D.C. By-l€W..... ct reer reer eeeeeeeeeeeeeeeeeeeeeeeeeneeeeeeeeneeeeen 2
6. RECOMMENAAIONS. ...........2::ccceeeeeeeeeeeneeeeeeeeeeeeeeeeneeeseeeeeeeeeeeeeaaaeeseeeeeesssseeaneeeeees 22
APPeNdix A 1... .ecececeeeeeeeee enna eeeeeeeeeeeeeeeenaeeseeeeeeeeeeeenaeaessseeeeeseseeeaeaeeeseeeeessseeseeeeeeeeeeeeeees ATT
APPeNdix B 1... ..cccceeeeeeeeeeeeeeeeeeeeeeeeeeeeeeaeeeseeeeeeeeeeeeeeaeeseeeeeeeeeeeeneaeeeseeeeseseeeseeesseseeeeeeees BOT
Watson & Associates Economists Ltd.
H:\Lakeshore\2022 DC & WWW Rate Study Update\DC Update\Report.docx
List of Acronyms and Abbreviations
Acronym Full Description of Acronym
D.C. Development Charge
D.C.A. Development Charges Act
1. Introduction
1.1 Background
The Municipality of Lakeshore imposes development charges (D.C.s) to recover capital
costs arising from the increase in need for services related to growth. The Municipality
currently has a municipal-wide D.C. for the following services:
e Services related to a highway;
e Public works;
e Fire protection services;
e Policing services;
e Parks and Recreation services;
e Library services; and
e Growth studies
In addition to the above services, the Municipality also recovers water and wastewater
costs in the Municipality's urban-serviced areas.
The basis for these D.C.s is documented in the "Town of Lakeshore Development
Charges Background Study" dated October 7, 2020, which provided the supporting
documentation for By-law 89-2020. The D.C. by-law came into effect January 1, 2021.
The Municipality's D.C.s have been indexed (in accordance with Section 5 of the by-
law) annually on January 1° and are currently 14.47% higher than the rates
implemented under By-law 89-2020. The 2020 D.C.s (unindexed) are presented in
Figure 1-1.
Watson & Associates Economists Ltd. PAGE 1
Report
Figure 1-1
Municipality of Lakeshore
2020 Development Charges as per By-law 89-2020
RESIDENTIAL NON-RESIDENTIAL Wind Turbines &
. . 5 i Communication Solar Farm (per
Service/Class of Service i i- 5 Apartinents Special
vl vi Dee Oein, Other Multiples "PartmentS-2 Bachelor and1 Care/Special (Per SALT Area) oss Towers (per sq. ft.)
Z Bedroom Dwelling Units Turbine/Tower)
Municipal Wide Services/Classes of Services:
Services Related to a Highway 5,979 3,495 3,057 2,362 1,974 2.66 5,979 2.66
Public Works 566 331 289 224 187 0.25 - -
Fire Protection Services 711 416 364 281 235 0.31 711 0.31
Policing Services 106 62 54 42 35 0.05 106 0.05
Parks and Recreation Services 3,754 2,194 1,919 1,483 1,240 0.17 - -
Library Services - - - - - - - -
Growth Studies 460 269 235 182 152 0.20 460 0.20
Total Municipal Wide Services/Classes of Services 11,576 6767| «5,918 | 4574/3823] 8633 7,256| 3.22]
Urban Services
Wastewater Services 10,391 6,074 5,312 4,105 3,431 4.46
Water Services 4,222 2,468 2,159 1,668 1,394 1.82
Total Urban Services a ee 7,471 s77s|4azs| wat Td
GRAND TOTAL RURAL AREA 11,576 6,767 5,918 4,574 3,823 7,256
GRAND TOTAL URBAN AREA 26,189 15,309 13,389 10,347 8,648 7,256
Watson & Associates Economists Ltd. PAGE 2
Report
1.2 Existing Policies (Rules)
Appendix A of this report sets out the rules governing the calculation, payment and
collection of D.C.s as provided in By-law 89-2020.
1.3. Basis for the D.C. By-law Update
The purpose of this report is to update the current D.C. by-law to reflect updated cost
estimates and provide for the recovery of financing costs for the Denis St. Pierre Water
Pollution Plant Expansion. Details on the changes to the calculation are presented in
Section 4 of this report. The draft amending by-law is presented in Appendix B to this
report. Note: additional refinements to the by-law are proposed to reflect recent
changes to the Development Charges Act (D.C.A.). These changes include mandatory
exemptions and refined definitions.
1.4 Summary of the Process
The public meeting required under section 12 of the D.C.A. has been scheduled for
April 26, 2022. Its purpose is to present the update study to the public and to solicit
public input. The meeting is also being held to answer any questions regarding the
study's purpose, methodology and the proposed modifications to the Municipality's D.C.
by-law.
The process to be followed in finalizing the report and recommendations includes:
e consideration of responses received prior to, at or immediately following the
Public Meeting; and
e Council consideration of the amending by-law on May 31, 2022.
Figure 1-2 outlines the proposed schedule to be followed with respect to the D.C. by-law
adoption process
Watson & Associates Economists Ltd. PAGE 3
Report
Figure 1-2
Schedule of Key D.C. Process Dates for the Municipality of Lakeshore
Project Milestone Timing
1. Data collection, staff review, and D.C. February to March 2022
calculations
2. Background study and proposed by- March 30, 2022
law available to public
3. Public meeting advertisement placed No later than April 5, 2022
in newspaper(s
4. Public meeting of Council April 26, 2022
5. Council considers adoption of
background study and passage of by- | May 31, 2022
law
6. Newspaper notice given of by-law By 20 days after passage
passage
7. Last day for by-law appeal 40 days after passage
8. Municipality makes pamphlet
available (where by-law not By 60 days after in force date
appealed
1.5 Policy Recommendations
It is recommended that the Municipality's current D.C. policies, as identified in
Appendix A of this report, be continued.
Watson & Associates Economists Ltd. PAGE 4
Report
2. Changes to the D.C.A. Legislation
2.1 Bill 108 -- More Homes, More Choice Act, 2019
On May 2, 2019, the Province introduced Bill 108, which proposed changes to the
D.C.A. The Bill has been introduced as part of the Province's "More Homes, More
Choice: Ontario's Housing Supply Action Plan". The Bill received Royal Assent on
June 6, 2019.
While having received Royal Assent, many of the amendments to the D.C.A. would not
come into effect until they are proclaimed by the Lieutenant Governor (many of these
changes were revised through Bill 197). At the time of writing, the following provisions
have been proclaimed:
e Effective January 1, 2020, rental housing and institutional developments pay
D.C.s in six equal annual payments commencing at occupancy. Non-profit
housing developments will pay D.C.s in 21 equal annual payments. Interest may
be charged on the instalments, and any unpaid amounts may be added to the
property and collected as taxes.
e Effective January 1, 2020, the D.C. amount for all developments occurring within
2 years of a Site Plan or Zoning By-law Amendment planning approval (for
application submitted after this section is proclaimed), shall be determined based
on the D.C. in effect on the day of Site Plan or Zoning By-law Amendment
application. If the development is not proceeding via these planning approvals,
then the amount is determined the earlier of the date of issuance of a building
permit or occupancy.
Note, the above changes in the legislation were incorporated into the Municipality's
2020 D.C. by-law and are currently in effect.
On February 28, 2020, the Province released updated draft regulations related to the
D.C.A. and the Planning Act. A summary of these changes is provided below:
Changes to Eligible Services -- Prior to Bill 108, the D.C.A. provided a list of ineligible
services whereby municipalities could include growth related costs for any service that
was not listed. With Bill 108, the changes to the D.C.A. would now specifically list the
Watson & Associates Economists Ltd. PAGE 5
Report
services that are eligible for inclusion in the by-law. Further, the initial list of eligible
services under Bill 108 was limited to "hard services", with the "soft services" being
removed from the D.C.A. These services would be considered as part of a new
community benefits charge (discussed below) imposed under the Planning Act. As
noted in the next section this list of services has been amended through Bill 197.
Mandatory 10% deduction -- The amending legislation would remove the mandatory
10% deduction for all services that remain eligible under the D.C.A.
Remaining Services to be Included in a New Community Benefits Charge (C.B.C.)
Under the Planning Act -- It was proposed that a municipality may, by by-law, impose
a C.B.C. against land to pay for the capital costs of facilities, services and matters
required because of development or redevelopment in the area to which the by-law
applies. The C.B.C. was proposed to include formerly eligible D.C. services (as noted
below), in addition to parkland dedication and other types of cost formerly recovered
under Section 37 of the Planning Act.
2.2 Bill 138 -- Plan to Build Ontario Together Act, 2019
On November 6, 2019, the Province released Bill 138 which provided further
amendments to the D.C.A. and Planning Act. This Bill received Royal Assent on
December 10, 2019 and was proclaimed which resulted in sections related to the D.C.A.
(schedule 10) becoming effective on January 1, 2020. The amendments to the D.C.A.
included removal of instalment payments for commercial and industrial developments
that were originally included in Bill 108.
2.3 Bill 197 --- COVID-19 Economic Recovery Act, 2020
In response to the global pandemic that began affecting Ontario in early 2020, the
Province released Bill 197 which provided amendments to a number of Acts, including
the D.C.A. and Planning Act. This Bill also revised some of the proposed changes
identified in Bill 108. Bill 197 was tabled on July 8, 2020, received Royal Assent on July
21, 2020, and was proclaimed on September 18, 2020. The following provides a
summary of the changes:
Watson & Associates Economists Ltd. PAGE 6
Report
2.3.1 D.C. Related Changes
List of D.C. Eligible Services
e As noted above, under Bill 108 some services were to be included under the
D.C.A. and some would be included under the C.B.C. authority. However, Bill
197 revised this proposed change and has included all services (with some
exceptions) under the D.C.A. These services are as follows:
o Water supply services, including distribution and treatment services.
o Wastewater services, including sewers and treatment services.
o Storm water drainage and control services.
o Services related to a highway.
co Electrical power services.
o Toronto-York subway extension.
o Transit services.
o Waste diversion services.
o Policing services.
co Fire protection services.
o Ambulance services.
o Library services.
o Long-term Care services.
o Parks and Recreation services, but not the acquisition of land for parks.
o Public Health services.
o Childcare and early years services.
o Housing services.
o Provincial Offences Act services.
o Services related to emergency preparedness.
o Services related to airports, but only in the Regional Municipality of
Waterloo.
co Additional services as prescribed.
Classes of Services -- D.C.
Pre-Bill 108/197 legislation (i.e. D.C.A., 1997) allowed for categories of services to be
grouped together into a minimum of two categories (90% and 100% services).
Watson & Associates Economists Ltd. PAGE 7
The amending legislation repealed and replaced the above with the four following
subsections:
e AD.C. by-law may provide for any eligible service or capital cost related to any
eligible service to be included in a class, set out in the by-law.
e Aclass may be composed of any number or combination of services and may
include parts or portions of the eligible services or parts or portions of the capital
costs in respect of those services.
e AD.C. by-law may provide for a class consisting of studies in respect of any
eligible service whose capital costs are described in paragraphs 5 and 6 of s. 5 of
the D.C.A.
e Acclass of service set out in the D.C. by-law is deemed to be a single service with
respect to reserve funds, use of monies, and credits.
Classes of services were established for Public Works and Growth Studies through the
2020 D.C. Background Study and by-law update.
10% Mandatory Deduction
As well, the removal of 10% deduction for soft services under Bill 108 has been
maintained. Note, the current by-law has incorporate the removal of the 10% deduction
for all soft services.
10-Year Planning Horizon
The "maximum" 10-year planning horizon requirement has been removed for all
services except transit.
2.3.2 Community Benefit Charges (C.B.C.)
While a Community Benefit Charge is not being considered within this report, a
summary of the legislated changes is provided herein for information purposes.
C.B.C. Eligibility
e The C.B.C. is limited to lower-tier and single tier municipalities, whereas upper-
tier municipalities will not be allowed to impose this charge.
Watson & Associates Economists Ltd. PAGE 8
Report
e O.Reg. 509/20 was filed on September 18, 2020. This regulation provides for the
following:
o Amaximum rate will be set as a percentage of the market value of the
land the day before building permit issuance. The maximum rate is set at
4%. The C.B.C may only be imposed on developing or redeveloping
buildings which have a minimum height of five stories and contain no less
than 10 residential units.
o Bill 197 states that before passing a C.B.C. by-law, the municipality shall
prepare a C.B.C. strategy that (a) identifies the facilities, services, and
matters that will be funded with C.B.C.s; and (b) complies with any
prescribed requirements.
o Only one C.B.C. by-law may be in effect in a local municipality at a time.
2.3.3 Combined D.C. and C.B.C. Impacts
D.C. vs. C.B.C. Capital Cost
e AC.B.C. may be imposed with respect to the services listed in s. 2 (4) of the
D.C.A. (eligible services), "provided that the capital costs that are intended to be
funded by the community benefits charge are not capital costs that are intended
to be funded under a development charge by-law."
Transition -- D.C. and C.B.C.
e The specified date for municipalities to transition to the D.C. and C.B.C. is two
years after Schedules 3 and 17 of the COVID-19 Economic Recovery Act comes
into force (i.e. September 18, 2022).
e Generally, for existing reserve funds (related to D.C. services that will be
ineligible):
o lIfaC.B.C. is passed, the funds are transferred to the C.B.C. special
account;
o IfnoC.B.C. is passed, the funds are moved to a general reserve fund for
the same purpose.
o lIfaC.B.C. is passed subsequent to moving funds to a general reserve
fund, those monies are then moved again to the C.B.C. special account.
e For reserve funds established under s. 37 of the Planning Act (e.g. bonus zoning)
Watson & Associates Economists Ltd. PAGE 9
eport
o lIfaC.B.C. is passed, the funds are transferred to the C.B.C. special
account;
o IfnoC.B.C. is passed, the funds are moved to a general reserve fund for
the same purpose;
o lIfaC.B.C. is passed subsequent to moving funds to a general reserve
fund, those monies are then moved again to the C.B.C. special account.
If a municipality passes a C.B.C. by-law, any existing D.C. credits a landowner retains
may be used towards payment of that landowner's C.B.C.
2.4 Bill 213 -- Better for People, Smarter for Business Act,
2020
On December 8, 2020, Bill 213 received Royal Assent. One of the changes of the Bill
that took effect upon Royal Assent included amending the Ministry of Training, Colleges
and Universities Act by introducing a new section that would exempt the payment of
D.C.s for developments of land intended for use by a university that receives operating
funds from the Government.
Due to this, a revision to the exemptions section will be made in the proposed amending
D.C. by-law.
Watson & Associates Economists Ltd. PAGE 10
Report
3. Anticipated Development
3.1 Growth Forecast in 2020 D.C. Study
The 2020 D.C. study provided for the anticipated residential and non-residential growth
within the Municipality of Lakeshore. The growth forecast associated with services
included in the background study is provided in Figure 2-1 below:
Figure 2-1
Municipality of Lakeshore
2020 D.C. Background Study -- Growth Forecast Summary
10 Year 20 Year Urban 20 Year
Measure 2020-Urban
2020-2029 2020-2039 SES
Source: Watson & Associates Economists Ltd. Forecast 2020
For the purposes of this D.C. update, the 2020 D.C. study growth forecast remains
unchanged as the incremental growth is anticipated to remain the same.
Watson & Associates Economists Ltd. PAGE 11
Report
4. Updates to the Municipality's D.C. Study
As noted earlier, the Municipality's D.C. By-law (By-law 89-2020) came into effect on
January 1, 2021, being a by-law for the purposes of establishing and collecting a D.C. in
accordance with the provisions of the D.C.A. The 2020 D.C. Study and by-law identified
anticipated capital needs for recovery through D.C.s for Municipal-wide and urban-area
services (water and wastewater services).
This chapter of the report discusses the updates to the capital needs for wastewater
services.
As this study represents an update to the 2020 D.C. Background Study the capital costs
are presented in 2020 dollars.
4.1 Wastewater Services
An expansion to the Denis St. Pierre Water Pollution Control Plant was identified in the
2020 D.C. study at a capital cost of approximately $30 million (2020 dollars). This was
based on estimated construction and associated tender prices in 2018/2019. The
COVID-19 pandemic has been a significant factor in the increase in tender prices for
construction. There is no anticipated change in the scope of the project; the increase in
cost is reflective of the increase in construction/tender prices. As such, the revised
estimate based on current tender prices is $54 million (or approximately $47 million in
2020 dollars). Based on the 2020 D.C. background study, this project is 90% growth-
related. This results in a net capital cost of $39.76 million to be included in the D.C.
calculation.
In addition to the capital costs for the expansion, the Municipality has also identified
financing costs for the Denis St. Pierre expansion project. Approximately $5.10 million
has been identified and included in the D.C. calculation.
Based on these additional costs, approximately $60.02 million is to be included in the
D.C. calculation for wastewater facilities (for comparison, $39.74 million was included in
the 2020 D.C. study).
Based on the Municipality's 2020 D.C. study, the growth-related costs have been
allocated between residential and non-residential development based on the
Watson & Associates Economists Ltd. PAGE 12
Report
incremental population and employment growth over the forecast period in urban
serviced areas. This results in a 65% allocation to residential development and 35%
allocation to non-residential development.
Watson & Associates Economists Ltd. PAGE 13
Report
Figure 3-1
Municipality of Lakeshore
Wastewater Facilities Capital - Updated
(2020 Dollars)
Less: Potential D.C. Recoverable Cost
Other Grants, Subsidies
Increased Service Needs Attributable to Gross Capital Deductions (to > Non-
Prj.No Anticipated Development "year Cost Estimate ee enett recognize ne aiaes Soret ke coe Total elias Residential
y (2020$) benefit to non- xasting rontninutions ota Share
D.C. services) Development Attributable to New
2020-2039 (Urban) -- Development 65% 35%
2 __ |North Woodslee package plant - Growth 2020-2023 17,400 17,400 17,400 11,310 6,090
interest (Discounted)
| 3 |Treatment Plant Debt #1 - Growth Principal | 2020-2022 304,621; --- |t--<"<'i;:'ét TU 304,621 198,004 106,617
4 Treatment Plant Debt #1 - Growth Interest 2020-2022 8,094 8,094 8,094 5,261 2,833
(Discounted)
| 5 _ [Treatment Plant Debt #2 - Growth Principal [2020-2031 5215647[| - | | 5215647[ - | ss 8 215,647 | 3,390,170 1,825,476
Treatment Plant Debt #2 - Growth Interest | 599 9934 820,034 820,034 820,034 533,022 287,012
(Discounted)
41 |Water Pollution Plant Comber, Stoney Point, | 5935 5936] 25,000,000 | 2,102,300 22,897,700 | 13,750,000 9,147,700 | 5,946,005 3,201,695
Lighthouse Phase 1
42 Water Pollution Plant Comber, Stoney Point, 2045-2046 5,093,100 5,093,100
Lighthouse Phase 2
43a _|Water Pollution Plant Expansion Belle River [59599993] 47,000,000 | 2,538,000 44,462,000 | 4,700,000 39,762,000 | 25,845,300; 13,916,700
(Dennis St. Pierre)
13b [Financing Costs for Water Pollution Plant | 5995 9941 5,104,894 5,104,894 5,104,894 | 3,318,181 1,786,713
Expansion Belle River (Dennis St. Pierre)
2040 1,760,800[ 176,100; = =------séd|s«sé4,584,700| 1,584,700; =| = =--Sr - | = |
| __[Reserve Fund Adjustment Po 80877 680,877)| 377,570) (203,307)
* Timing of Works may be dependent upon receiving funding assistance which would include developer assistance, grants, etc.
Watson & Associates Economists Ltd. PAGE 14
Report
4.2 D.C. By-law Revised Schedule of Charges
4.2.1 Updated D.C. Calculation (2020$)
The following table provides the updated D.C. calculations based on the revised capital
needs discussed in Section 4.1. Changes from the 2020 D.C. study are highlighted in
the table.
For the residential calculations, the total cost is divided by the "gross" (new resident)
population to determine the per capita amount. The eligible D.C. cost calculations set
out in Section 4.1 are based on the net anticipated population increase (the forecast
new unit population less the anticipated decline in existing units). The cost per capita is
then multiplied by the average occupancy of the new units (Appendix A, Schedule 5 to
the 2020 D.C. background study) to calculate the charge in Figure 4-2.
With respect to non-residential development, the total costs in the uniform charge
allocated to non-residential development (based on need for service) have been divided
by the anticipated development over the planning period to calculate a cost per sq.ft. of
gross floor area.
Watson & Associates Economists Ltd. PAGE 15
Report
Figure 4-2
Municipality of Lakeshore
Updated Wastewater D.C. Calculations
2020 to 2039
2020$ D.C.-Eligible Cost 2020$ D.C.-Eligible Cost
SERVICE/CLASS Residential Non-Residential S.D.U. per sq.ft.
$ $ $ $
1. Wastewater Services
1.1 Treatment plants 39,010,847 21,005,840 10,903 4.67
1.2 Sewers 11,495,377 6,189,818 3,213 1.38
2. Water Services
2.1. Treatment plants and storage 9,882,778 5,321,496 2,762 1.19
2.2 Distribution systems 5,223,010 2,812,390 1,460 0.63
[roTR 612,011 | 835,329,544] t8,338| 87.87
a
By Residential Unit Type P.P.U.
Single and Semi-Detached Dwelling 3.331 $18,338
Other Multiples 1.947 $10,719
Apartments - 2 Bedrooms + 1.703 $9,376
Apartments - Bachelor and 1 Bedroom 1.316 $7,245
Figures 4-3 and 4-4 compare the amended charges with the D.C. rates presented in By-
law 89-2020. The comparison is provided for single detached dwellings on a per unit
basis and for non-residential floor space on a per square foot basis (2020 dollar values).
Watson & Associates Economists Ltd. PAGE 16
Report
Figure 4-3
Municipality Of Lakeshore
Comparison of Existing and Amending Residential D.C. per Single Detached Unit
(2020$)
Current Calculated
(By-law 89-2020) (D.C. Update)
Service/Class of Service (2020$) (2020$)
Municipal Wide Services/Classes of Services:
Services Related to a Highway 5,979 5,979
Public Works 566 566
Fire Protection Services 711 711
Policing Services 106 106
Parks and Recreation Services 3,754 3,754
Library Services - -
Growth Studies 460 461
ee rememrseen | an
Wastewater Services 10,391 14,116
Water Services 4,222 4,222
GrandTotal-UrbanArea CT 26,189] 29,915
Watson & Associates Economists Ltd. PAGE 17
eport
Figure 4-4
Municipality of Lakeshore
Comparison of Existing and Amending Non-Residential D.C. per sq.ft. (2020$)
Current Calculated
(By-law 89-2020) (D.C. Update)
Service/Class of Service (2020$) (2020$)
Municipal Wide Services/Classes of Services:
Services Related to a Highway 2.66 2.66
Public Works 0.25 0.25
Fire Protection Services 0.31 0.31
Policing Services 0.05 0.05
Parks and Recreation Services 0.17 0.17
Library Services - -
Growth Studies 0.20 0.20
eee eee
Wastewater Services 4.46 6.05
Water Services 1.82 1.82
[Grand Total-UrbanArea | 11.50 |
4.2.2 Revised D.C. Rates (2020$ and 2022$)
Based on the calculations above, the urban-area D.C. (in 2020$) is calculated to
increase from $26,189 to $29,915 per single detached unit and increase from $9.91 to
$11.50 per square foot for non-residential development.
Figure 4-5 provides for the updated D.C.s in 2020 values, as the study was originally
completed in 2020. This figure would be included as the amending schedule to the D.C.
by-law. Figure 4-6 provides for the indexed values as the Municipality's current D.C.s
have been indexed by 14.47% since the passage of the D.C. by-law
Watson & Associates Economists Ltd. PAGE 18
'eport
Figure 4-5
Municipality of Lakeshore
Updated D.C. Schedule (2020$)
RESIDENTIAL NON-RESIDENTIAL Wind Turbines &
. . 5 i Communication Solar Farm (per
Service/Class of Service i i- 5 Apartments Special
i ™ bes Oe a cing Other Multiples Ape ments 2 Bachelor and 1 Care/Special {per sa rea) oss Towers (per sq. ft.)
Z Bedroom Dwelling Units Turbine/Tower)
Municipal Wide Services/Classes of Services:
Services Related to a Highway 5,979 3,495 3,057 2,362 1,974 2.66 5,979 2.66
Public Works 566 331 289 224 187 0.25 - -
Fire Protection Services 711 416 364 281 235 0.31 711 0.31
Policing Services 106 62 54 42 35 0.05 106 0.05
Parks and Recreation Services 3,754 2,194 1,919 1,483 1,240 0.17 - -
Library Services - - - - - - - -
Growth Studies 461 269 236 182 152 0.20 461 0.20
Total Municipal Wide Services/Classes of Services 11,577 6,767 } 5,919 | 4,574 a eee) 7,257 | 3.2]
Urban Services
Wastewater Services 14,116 8,251 7,217 5,577 4,662 6.05
Water Services 4,222 2,468 2,159 1,668 1,394 1.82
GRAND TOTAL RURAL AREA 11,577 6,767 4,574 3,823 7,257
GRAND TOTAL URBAN AREA 29,915 17,486 11,819 9,879 7,257
Watson & Associates Economists Ltd. PAGE 19
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Figure 4-6
Municipality of Lakeshore
Updated D.C. Schedule (2022$)
RESIDENTIAL NON-RESIDENTIAL Wind Turbines &
. . 5 i Communication Solar Farm (per
Service/Class of Service i i- - Apartinents Special
vi w Det hat Dect Other Multiples Ape ments ;? Bachelor and1 --_Care/Special {per sa rea) oss _ Towers (per sq. ft.)
Z Bedroom Dwelling Units Turbine/Tower)
Municipal Wide Services/Classes of Services:
Services Related to a Highway 6,844 4,001 3,499 2,704 2,260 3.04 6,844 3.04
Public Works 648 379 331 256 214 0.28 - -
Fire Protection Services 814 476 417 322 269 0.35 814 0.35
Policing Services 121 71 62 48 40 0.06 121 0.06
Parks and Recreation Services 4,297 2,511 2,197 1,698 1,419 0.19 - -
Library Services - - - - - - - -
Growth Studies 528 308 270 208 174 0.23 528 0.23
Total Municipal Wide Services/Classes of Services | =--------_13,252 | 7,746 6,775| «5,236 | 4376| 4.46 | 8,307| 3.68
Urban Services
Wastewater Services 16,158 9,445 8,261 6,384 5,337 6.93
Water Services 4,833 2,825 2,471 1,909 1,596 2.08
GRAND TOTAL RURAL AREA 7,746 6,775 4,376 8,307 3.68
GRAND TOTAL URBAN AREA 20,016 17,508 11,308 8,307 3.68
Watson & Associates Economists Ltd. PAGE 20
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5. Updates to the D.C. By-law
As summarized in Chapter 2, the D.C. by-law will require several updates to conform
with the D.C.A., as amended. Note: the Municipality's 2020 D.C. by-law conforms with
the D.C.A. with respect to installment payments for rental housing, institutional and non-
profit housing developments as well as the freezing of D.C. rates at site plan/zoning by-
law amendment application date. Further revisions are provided to align with the D.C.A.
with respect to mandatory exemptions.
With respect to exemptions, the following will be included as per O. Reg. 454-19:
No development charge shall be payable where the development:
e is limited to the creation of an additional dwelling unit as prescribed, in prescribed
classes of new residential buildings as set out in the Regulations to the
Development Charges Act, 1997; and
e is limited to the creation of an additional dwelling unit in a structure that is
ancillary to a new dwelling unit in prescribed classes of new residential buildings
as set out in the Regulations to the Development Charges Act, 1997.
With respect to exemptions, the following will be included as per Bill 213:
e Land vested in or leased to a university that receives regular and ongoing
operating funds from the government for the purposes of post-secondary
education is exempt from development charges imposed under the Development
Charges Act, 1997 if the development in respect of which development charges
would otherwise be payable is intended to be occupied and used by the
university.
Other new definitions have been included in the draft by-law to incorporate language
being used in the amended legislation, they include definitions such as Accessory
Dwelling; Ancillary Residential Building, etc.
Watson & Associates Economists Ltd. PAGE 21
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6. Recommendations
It is recommended that Council:
"Approve the Development Charges Update Study dated March 30, 2022, as
amended (if applicable)";
"Approve the updated capital projects set out in Section 4 of the Development
Charges Update Study dated March 30, 2022";
"Determine that no further public meeting is required"; and
"Approve the Amending Development Charge By-law as set out in Appendix B".
Watson & Associates Economists Ltd. PAGE 22
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PA
Appendix A
Existing Policies Under
By-law 89-2020
Appendix A: Existing Policies Under By-law xx
The following subsections set out the rules governing the calculation, payment, and
collection of D.C.s as provided in By-law 89-2020, in accordance with the D.C.A.
Approvals for Development
Development charges shall be imposed on all lands, buildings or structures that are
developed for residential or non-residential uses if the development requires,
a) the passing of a zoning by-law or an amendment to a Zoning by-law under
Section 34 of the Planning Act, R.S.O. 1990;
b) the approval of a minor variance under Section 45 of the Planning Act, S.O.
1990;
Cc) aconveyance of land to which a by-law passed under Subsection 50(7) of the
Planning Act, R.S.O. 1990, applies;
d) the approval of a plan of subdivision under Section 51 of the Planning Act;
e) aconsent under Section 53 of the Planning Act;
f) the approval of a description under Section 50 of the Condominium Act, R.S.O.
1990; or
g) the issuing of a permit under the Building Code Act S.O. 1990, in relation to a
building or structure.
Determination of the Amount of the Charge
The calculation for residential development is generated on a per capita basis and is
based upon different forms of housing types (single and semi-detached, apartments
with two or more bedrooms, one-bedroom apartments and bachelors, multiples, and
special care/special dwelling units). The total cost is divided by the "gross" (new
resident) population to determine the per capita amount. The eligible D.C. cost
calculations are based on the net anticipated population increase (the forecast new unit
population less the anticipated decline in existing units). This approach acknowledges
that service capacity will be "freed up" by the population decline in existing units. The
Watson & Associates Economists Ltd. PAGE A-2
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cost per capita is then multiplied by the average occupancy of the new units to calculate
the charges by type of residential dwelling unit.
The non-residential D.C. has been calculated based on a per square foot of gross floor
area basis.
Reduction of Development Charges for Redevelopment
If a development involves the demolition of and replacement of a building or structure
on the same site, or the conversion from one principal use to another, the developer
shall be allowed a credit equivalent to:
1) the number of dwelling units demolished/converted multiplied by the applicable
residential D.C. in place at the time the D.C. is payable; and/or
2) the gross floor area of the building demolished/converted multiplied by the
current non-residential D.C. in place at the time the D.C. is payable.
The redevelopment credit is allowed only if the land was improved by occupied
structures and if the demolition permit related to the site was issued less than five years
prior to the issuance of a building permit. The credit can, in no case, exceed the amount
of D.C.s that would otherwise be payable.
Exemptions (full or partial)
The following are exempted from D.C.s:
e Statutory exemptions
o Industrial building additions of up to and including 50% of the existing
gross floor area (defined in O. Reg. 82/98, s. 1) of the building; for
industrial building additions which exceed 50% of the existing gross floor
area, only the portion of the addition in excess of 50% is subject to D.C.s
(s. 4 (3)) of the D.C.A (note, this applies to the first 50% only);
o buildings or structures owned by and used for the purposes of any
municipality, local board or Board of Education (s. 3); and
o residential development that results only in the enlargement of an existing
dwelling unit, or that results only in the creation of up to two additional
dwelling units (based on prescribed limits set out in s.2 of O. Reg. 82/98).
Watson & Associates Economists Ltd. PAGE A-3
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e Non-statutory exemptions
o Lands, buildings or structures used or to be used for a place of worship or
for the purposes of a cemetery or burial ground exempt from taxation
under the Assessment Act; and
o Non-residential farm buildings constructed for bona fide farm uses.
Indexing
The D.C.s imposed shall be adjusted annually, without amendment to the by-law, based
on the prescribed index in the D.C.A. on January 1, commencing on January 1, 2021.
By-law Duration
The by-law will expire on January 1, 2025, unless it is repealed by Council at an earlier
date.
Timing of D.C. Payments
The D.C.s for all services and classes are payable upon issuance of the first building permit
for each dwelling unit, building, or structure, subject to early or late payment agreements
entered into by the Municipality and an owner under s.27 of the D.C.A., 1997.
Rental housing and institutional developments pay D.C.s in six equal annual payments
commencing at occupancy. Non-profit housing developments pay D.C.s in 21 equal
annual payments. Moreover, the D.C. amount for all developments occurring within 2
years of a Site Plan or Zoning By-law Amendment planning approval (for applications
submitted after January 1, 2020), shall be determined based on the D.C. in effect on the
day of the Site Plan or Zoning By-law Amendment application.
Installment payments and payments determined at the time of Site Plan or Zoning
Bylaw Amendment application may be subject to annual interest charges. The
applicable interest rate is provided in the Municipality's "Development Charge Interest
Policy".
Watson & Associates Economists Ltd. PAGE A-4
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Z
Appendix B
Draft Amending
Development Charges
By-law
Appendix B: Draft Amending Development
Charge By-law
The Corporation of the Municipality of Lakeshore
By-law Number xx-2022
Being a By-Law of The Corporation of the Municipality of Lakeshore To Amend
By-Law 89-2020, Respecting Development Charges
Whereas the Municipality of Lakeshore enacted By-law 89-2020 pursuant to the
Development Charges Act, 1997, S.O. 1997, c. 27, as amended (the "Act"), which Act
authorizes Council to pass by-laws for the imposition of development charges against
land;
And Whereas the Municipality has undertaken a study pursuant to the Act which has
provided updated definitions and an updated Schedule B to By-law 89-2020;
And Whereas Council has before it a report entitled "Town of Lakeshore 2022
Development Charges Update Study" prepared by Watson & Associates Economists
Ltd., dated March 30, 2022 (the "update study");
And Whereas the update study and proposed amending by-law were made available to
the public on March 30, 2022 and Council gave notice to the public pursuant to section
12 of the Act.
And Whereas Council, on April 26, 2022 held a meeting open to the public, pursuant to
section 12 of the Act, at which Council considered the study, and written and oral
submissions from the public;
NOW THEREFORE THE COUNCIL OF THE CORPORATION OF THE
MUNICIPALITY OF LAKESHORE HEREBY ENACTS AS FOLLOWS:
1. By-law 89-2020 is hereby amended as follows:
A. Addition of Accessory to the definitions in Section 1.1 as follows:
Watson & Associates Economists Ltd. PAGE B-2
Report
Accessory: means a use, building, or structure that is normally incidental and/or
subordinate and is exclusively devoted to a main use and/or a building and/or
structure, and is located on the same lot therewith. Accessory has the same
meaning as ancillary.
B. Revise the definition of Apartment Dwelling in Section 1.1 to include ancillary
units. The refined definition would read as follows:
"apartment dwelling" means any residential dwelling unit within a building
containing five or more dwelling units where access to each residential unit is
obtained through a common entrance or entrances from the street level through
a common entrance or entrances from the street level and the residential units
are connected by an interior corridor. Apartment dwelling may also refer to a
dwelling unit in a structure that is ancillary to a residential building;
C. Addition of Class to the definitions in Section 1.1 as follows:
"Class" means a grouping of services combined to create a single service for the
purposes of this By-law and as provided in Section 7 of the Development
Charges Act. Also referred to as class of service or classes of services.
D. Addition of Site to the definitions in Section 1.1 as follows:
"Site" means a parcel of land which can be legally conveyed pursuant to Section
50 of the Planning Act and includes a development having two or more lots
consolidated under one identical ownership.
E. Insert Section 3.7.1 as follows:
Rules with Respect to Exemptions for Intensification of Existing Housing
(a) No Development Charge shall be imposed where the only effect of an
action referred to in Section 3.4 of this By-law is to:
i) permit an enlargement to an existing residential Dwelling Unit;
ii) permit the creation of one or two additional Dwelling Units in an
existing single detached dwelling or a prescribed ancillary
residential dwelling structure to the existing residential building;
Watson & Associates Economists Ltd. PAGE B-3
Report
iii) permit the creation of additional dwelling units equal to the
greater of one Dwelling Unit or one percent of the existing
Dwelling Units in existing Rental Housing or a prescribed
ancillary residential dwelling structure to the existing residential
building;
iv) permit the creation of one additional dwelling unit in any other
existing residential building already containing at least one
Dwelling Unit or prescribed ancillary residential dwelling
structure to the existing residential building; or
v) permit the creation of a second dwelling unit in prescribed
classes of proposed new residential buildings, including
residential dwelling structures ancillary to dwellings, subject to
the following restrictions:
Name of Class of _
Description of Class of Proposed New --_
oe eee Residential Buildings Sa
Residential Buildings
Proposed new residential buildings that wouldnot |The proposed new detached dwelling must only contain two
be attached to other buildings and that are dwelling units.
4 Proposed new detached permitted to contain a second dwelling unit, that
have the same gross floor area, or the smaller of |parcel of land on which no other detached dwelling, semi-
the dwelling units. detached dwelling or row dwelling would be located.
Proposed new residential buildings that would The proposed new semi-detached dwelling or row dwelling
have one or two vertical walls, but no other parts, |must only contain two dwelling units.
Proposed new semi- attached to other buildings and that are permitted
dwellings of the two dwelling units, if the units have the must be located on a parcel of land on which no other
same gross floor area, or the smaller of the detached dwelling, semi-detached dwelling or row dwelling
dwelling units. would be located.
The proposed new detached dwelling, semi-detached dwelling
, , or row dwelling, to which the proposed new residential building
Proposed new residential , ; -- would be ancillary, must only contain one dwelling unit.
buildings that would be Proposed new residential buildings that would be
3 ancillary to a proposed new] ancillary to a proposed new detached dwelling,
detached dwelling, semi- | semi-detached dwelling or row dwelling and that |The gross floor area of the dwelling unit in the proposed new
dwelling floor area of the detached dwelling, semi-detached dwelling or
row dwelling to which the proposed new residential building is
ancillary .
(b) Notwithstanding 3.7.1(a) above, Development Charges shall be
imposed if the total Gross Floor Area of the additional one or two units
exceeds the Gross Floor Area of the existing Dwelling Unit.
(c) Notwithstanding 3.7.1(a) above, Development Charges shall be
imposed if the additional Dwelling Unit(s) has a Gross Floor Area
greater than:
Watson & Associates Economists Ltd. PAGE B-4
Report
i) in the case of a Semi-detached Dwelling Unit or Townhouse
Dwelling Unit, the Gross Floor Area of the existing Dwelling
Unit; and
ii) in the case of any other Residential Building, the Gross Floor
Area of the smallest Dwelling Unit contained in the said
residential Building.
(d) The exemption to Development Charges in 3.7.1(a) above shall only
apply to the first instance of intensification in an existing or new
dwelling.
(e) Subject to 3.7.1(b), 3.7.1(c), and 3.7.1(d) above, any exemption under
3.7.1(a) above shall apply to the smallest Dwelling Unit, as determined
by applicable rates under this By-law.
F. Add item c) to Section 3.10 as follows:
(c) Land vested in or leased to a university that receives regular and
ongoing operating funds from the government for the purposes of post-
secondary education is exempt from development charges imposed
under the Development Charges Act, 1997 if the development in
respect of which development charges would otherwise be payable is
intended to be occupied and used by the university.
G. Schedule "B" is deleted and the attached Schedule "B" is substituted therefore.
2. This by-law shall come into force on the day it is enacted.
3. Except as amended by this by-law, all provisions of By-law 89-2020, as amended,
are and shall remain in full force and effect.
Watson & Associates Economists Ltd. PAGE B-5
Report
By-law read a first and second time this 31% day of May, 2022.
By-law read a third time and finally passed this 31S day of May, 2022.
Corporation of the Municipality of Lakeshore
Mayor:
Clerk:
Watson & Associates Economists Ltd. PAGE B-6
Report
" "
Schedule "B" to By-law 89-2020
Residential and Non-Residential Development Charges
RESIDENTIAL NON-RESIDENTIAL Wind Turbines &
. . - i Communication Solar Farm (per
Service/Class of Service i i- 5 Apartinents Special
i ie mils ene me Other Multiples Openers 2 Bachelor and 1 Care/Special {per sa ss Towers (per sq. ft.)
cette Bedroom Dwelling Units y Turbine/Tower)
Municipal Wide Services/Classes of Services:
Services Related to a Highway 5,979 3,495 3,057 2,362 1,974 2.66 5,979 2.66
Public Works 566 331 289 224 187 0.25 - -
Fire Protection Services 711 416 364 281 235 0.31 711 0.31
Policing Services 106 62 54 42 35 0.05 106 0.05
Parks and Recreation Services 3,754 2,194 1,919 1,483 1,240 0.17 - -
Library Services - - - - - - - -
Growth Studies 461 269 236 182 152 0.20 461 0.20
Total Municipal Wide Services/Classes of Services 11,577 6,767 } 5,919 | 4,574 a eee) 7,257 | 3.29]
Urban Services
Wastewater Services 14,116 8,251 7,217 5,577 4,662 6.05
Water Services 4,222 2,468 2,159 1,668 1,394 1.82
GRAND TOTAL RURAL AREA 11,577 6,767 4,574 3,823 7,257
GRAND TOTAL URBAN AREA 29,915 17,486 11,819 9,879 7,257
Watson & Associates Economists Ltd. PAGE B-7
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