By Janelle Brennand
A revised bylaw that exempts certain downtown developers from development fees but continues to charge others has some builders in Centretown frustrated, says the owner of one local development company.
Twenty-five legal appeals have been launched against the city since council voted to drastically increase development fees last July.
Last month, council attempted to sidestep the appeals by reducing fees across the city and expanding the boundaries of the area already exempt from residential development charges.
David Choo, the owner of Ashcroft Homes, says many developers think the lines
that determine which areas of Centretown are exempt from fees were arbitrarily drawn.
“[the developers] didn’t have a say because it was councillors (who made the decision),” he says. “There’s been a number
of appeals because people who fell on the other side of the line felt that was unfair.”
The area exempt from residential development charges is bounded by Laurier Avenue, O’Connor Street, the Queensway, the CPR line,
Somerset Street West and Bronson Avenue.
The boundary to the west was extended from Rochester Street to the CPR line by city council in December, after several Preston Street businesses filed complaints for being excluded from the exemption.
Coun. Diane Holmes put forward the motion that extended the boundary. She says the area now included in the exemption was in need of some development assistance.
The fee exemption, says Holmes, was an incentive for builders to increase residential development downtown, one of the city’s priorities.
“It’s what makes for an exciting city,” she says. “We want our business streets to be healthy. The more people living downtown the better, and this is an
incentive for developers to build downtown.”
Holmes says she has not yet received any complaints from developers about the new boundaries.
The areas of Centretown that are not within the exempted area must still pay the reduced development fee. The fees are necessary, says Holmes, to help recover the costs of building the new infrastructure required when new developments spring up.
“We had not been charging enough in the past,” says Holmes, explaining why the fees were increased in July. “The city felt we had to have growth pay for itself.”
Nevertheless, Holmes admits the sharp increase in fees was a mistake.
“That was just our staff being more enthusiastic than the
developing charges [bylaw] would really support,” she says, adding that the developers who had opposed the bylaw would likely have won had they
taken their case to the Ontario Municipal Board. “The city was somewhat unrealistic to start with.”
Ned Lathrop, deputy city manager, says the developers who were upset with the
increase thought it contradicted the city’s commitment to
revitalizing the downtown core.
“They thought it would slow down that intensification,” he says.
The new amendments, says Lathrop, decreased fees by about $700 or $800 for most single or multi-room apartments. Charges for single-family homes were reduced from about $10,500 to $9,500. That fee decrease makes the situation promising for builders in
Ottawa, adds Lathrop.
“There’s a significant change and a significant incentive,” he says.
Choo is not quite so optimistic. While his latest project – the construction of condominiums at the corner of O’Connor and McLeod streets – is exempt from development fees, he says it isn’t fair that developers who are building in other parts of Centretown have been excluded from the deal.
“I think all of Centretown should be exempt from development charges,” says Choo. “If you want to increase development, development charges exemption is a very effective way of trying to do that.”