Ontario housing bill will mean higher taxes for some Windsor-Essex municipalities

Cuts to fees that Windsor-Essex municipalities levy on home builders willcost municipalities hundreds of thousands of dollars, a survey by CBC News has found.

The provincial government passed Bill 23, known as the More Homes Built Faster Act, late last year. The legislation, which is part of the province's plan to build 1.5 million homes in the next decade, eliminates some fees that municipalities typically charge developers in exchange for the right to build homes.

CBC News asked the mayors of all nine municipalities in Windsor-Essex what that will mean to local taxpayers. Some say it'll cost at least six figures.

Unknown or no losses

Five municipalities saidthey were still crunching numbers.

John Revell, Windsor's chief building official, says there'll be a report in the next couple of months. Butnot all new builds in Windsor are subject to development charges on the part of the home builder.

"We have a development charge exemption area," said Revell. "That's roughly Tecumseh Roadto the river; Prince Roadon the west side to Pillette Roadon the east side."

Revellsays the city's focus is expandingexisting infrastructure in that zone.

In an emailed statement, the Town of Essex said they have "already taken steps to electively waive several areas of the Development Charge Act to encourage growth, lessening the financial impact of Bill 23."

Essex also issued a public letter to Steve Clark, Minister of Municipal Affairs and Housing on Dec.1 this year.

"In our review of the now-approved changes, it is still our position that Bill 23 creates a number of concerns that could compromise the financial health of the town and its residents," the letter reads.

Tecumseh Mayor Gary McNamara saysthe development charge for a single-family home in his municipality is around $24,000. If100 homes were built in five years, McNamara says, the development charges would amount to about$2.4 million.

McNamara says there'll be some difficult choices.

"Either we are going to raise property taxes to augment the revenue required to deal with the new rules, or [provide] an equal decrease in servicing," he said.

Kingsville Mayor Dennis Rogers says he couldn't speculate on the impact. Leamington will deal with the issue in March.

Pelee Island Mayor Cathy Miller says the reduction of development charges won't affect themunicipality.

Estimated losses

Lakeshore willlose between $340,000 and $864,000, saysMayor Tracey Bailey. That'll meana tax increase between one and 2.5 per cent.

"In addition to covering development charges through the general tax base, we will also require additional staffing to meet the demands of the new legislated permit approval timelines," she said. "We've estimated that the staffing required would add an additional estimated one to two per cent to our annual expenditure."

Bailey said the average homeowner would face a tax increase of as much as4.5 per cent, or as much as $80 per year.

LaSalle plans to increase taxes to make up the shortfall.

Quantified losses

"The estimated annual development charge revenue lost will amount to approximately $587,500 beginning in 2026 when the next development charge bylaw is passed," said Mayor Crystal Meloche.

"The average residence in LaSalle will have an approximately $37 increase on their annual tax bill to fully fund the estimated $587,500 annual requirement."

Amherstburgcould facea deficit of $190,000, saysMayor Michael Prue. That money accounts for less than one per cent of the town's budget, so he doesn't foresee a tax increase. Pruesaysthe town might have to "eat it".

"We can't afford to go down that road without the province kicking in," he said.

Prue saidd the loss comes from the foregoing of construction of two apartment buildings. For now, he's waiting to see what the province does.

'Like robbing Peter to pay Paul'

"Minister Clark sent me a letter, saying he will try to make us whole," Prue said.

Bailey says she's skepticalBill 23 will help the province achieve its goal of building 1.5 million homes in 10 years.

"I believe it is shifting the burden of growth to all residents of the municipality, which is like robbing Peter to pay Paul," said Bailey.

McNamara sayshis staff hasreached out to the Ministry of Municipal Affairs and Housing for a seminar to help them understand the bill.

Ministry spokespersonMatt Carter saysdevelopment charge increases were a detriment to building homes.

"To be clear, this doesn't mean that municipalities won't get revenue from a new home build," he said in an email.

"It means that home ownership won't keep moving further out of reach for Ontarians because of increased fees that add thousands to the price of a home. We are launching a third-party audit of select municipalities to get a factual understanding of their finances, including their reserve funds and development charge administration."