St. Catharines City Council has approved the re-introduction of development charges, providing a more balanced approach where growth pays for growth, rather than the burden of growth-related infrastructure falling to the taxpayer.

After extensive public engagement with the community and stakeholders – including the development industry and the City’s Development Studies Task Force, Council approved a development charges background study and bylaw Monday night, paving the way for development charge bylaw to come into effect January 1, 2022. Development charges are fees imposed on land development and redevelopment projects to help pay for the cost of infrastructure required to provide municipal services to new development, such as roads; transit; water and sewer infrastructure; fire services infrastructure; and park amenities and community centres.

St. Catharines is currently the only municipality in Niagara that does not collect lower-tier development charges.  For 12 years, this put the City at a competitive advantage and encouraged growth and interest in the community.  However, most growth-related infrastructure built in that time was primarily funded from the tax levy and/or water/wastewater rates. While the revenue will depend on development levels, a consultant hired to conduct the study has indicated the City could potentially collect millions of dollars in development charges on an annual basis to support infrastructure costs related to development and redevelopment.

“Years ago, the City of St. Catharines made a smart decision to attract investment and redevelopment and now, the time has come for Council to make another smart decision that better reflects the current state of investment attraction in St. Catharines,” said Mayor Walter Sendzik. “This is a fair, balanced approached that will ensure that the costs of new development do not fall to the taxpayer and that growth will pay for growth in the future. Development charges will better position the City to invest in infrastructure and public realm improvements that benefit everyone.”

The charges – which will be applied to both residential and non-residential projects - will be city wide, allowing for more efficient use of funds and ensuring all growth that may benefit from the service has contributed towards it. The City’s charges, once they come into effect, will be lower than many municipal comparators and opportunities will exist for exemptions and grant programs to support projects such as affordable housing, employment creation and development in the urban core.    

The recently approved bylaw includes a transition period for developers with projects that are already underway. The charges themselves will be collectable beginning January 2022.

“Reinstating development charges is part of the City’s commitment towards better fiscal responsibility, stability and sustainability,” said Tami Kitay, the City’s Director of Planning and Building Services. “This transformational shift corrects an unbalance whereby growth will pay for their fair share of growth and will assist with capital budget forecasting and financing, strategic decision making, and investment back into the community.”