In my article dated Mar.20 (Scroll down for link) I explained the purpose, good and bad points of Development Charges (DC). At the Madawaska Valley Council meeting held on Mar.22 2023 and after a heated debate, a proposal by MV staff that DC be reintroduced was rejected. Councillors Shulist, Olsheski and Maika defeated Mayor Willmer and Councillor Blank, who were in favour of imposing DC on new construction in the municipality. Above from left: Councillor Mary Blank and Mayor Mark Willmer were outnumbered in a recorded vote. Photo: YouTube/Madawaska Valley
Mayor Willmer argued that DC would help the Township recover the costs of providing services such as roads, water, sewer, fire and recreation to new residents and businesses. He claimed that without DC, the existing taxpayers would have to bear the burden of growth and subsidize development. However, many opposed this view and saw DC as a deterrent to development and an additional tax on homebuyers. They pointed out that the province has encouraged municipalities to reduce barriers to growth and housing affordability, and that many other municipalities have waived or reduced DC to attract investment and development.
Councillor Olsheski was one of the vocal opponents of DC. He stated, “Scrap it, developers will build elsewhere.” He said that DC would make Madawaska Valley less competitive and less appealing to developers who could choose to build in neighbouring townships such as Brudenell, Lyndoch, Raglan or Hastings Highlands, areas with no DC.
Councillor Maika also spoke against DC. She said, “We have enough money coming in, it’s how we spend it.” She suggested that the Township should focus on managing its budget more efficiently and prioritizing its spending rather than imposing new fees on development.
Councillor Shulist also expressed his concerns about DC. He said, “This is not the right time.” He questioned how building a home along a road that is 130 to 140 years old would increase the cost to the Township. He said that DC would discourage people from building or renovating their homes in Madawaska Valley.
Both Mayor Willmer and Councillor Blank referred to DC as a “fee” not a tax. While they are technically correct, DC still represents an inhibitor to growth in this Township and an increased cost to the homebuyer, be it a single dwelling or a development. Developers factor DC into the selling price of a home, which makes housing more expensive for building and buyers. The bottom line? Many argued that DC would harm the Township’s competitiveness, affordability, and growth potential.
Despite significant opposition from taxpayers, MV Council re-engaged with the consultants (Watson and Associates) to come up with four options to reduce the initial impact by introducing the DC over four years. However, this still resulted in a significant addition to the cost of a new build.
Council should give some thought as to how the Township could broaden its tax base by attracting development, and explore other ways to fund infrastructure and services without burdening developers and homebuyers. Council might also want to consider what they can do to reduce bureaucratic costs and red tape that are delaying construction and pushing home prices even higher. Streamlining the approval process, simplifying the regulations, and providing incentives for development could help stimulate growth and create jobs in Madawaska Valley.
Also, Council could use the limits of their powers to reduce the almost one million dollars of tax arrears on the books and at the same time implement a less permissive policy towards late/non-payment so as to avoid such a significant level of arrears in future.
Editor’s Note: The title of this article was amended to reflect a recorded vote, not a “split” vote.