Item - 2021.EX24.4

The Executive Committee received the report (May 17, 2021) from the Chief Financial Officer and Treasurer, the Deputy City Manager, Community and Social Services and the Deputy City Manager, Infrastructure and Development Services for information.

This report provides an update on the City's approach to legislative changes to the City's growth-related funding tools enacted through the COVID-19 Economic Recovery Act, 2020 (Bill 197) and outlines a work plan to deliver updated City bylaws for Council consideration in Q2 2022.

The sweeping changes originally introduced in Bill 108 were largely rolled back in September 2020. The new legislation addresses many of concerns raised by municipalities during the consultation period, and in general, is more aligned with the "growth pays for growth" principle. This will be evaluated and reported on as part of this initiative.

At a high level, the City's three growth-related funding tools are impacted by the legislative changes as follows:

- Development Charges Act (DCA) – The legislation now has a prescriptive list of eligible services and most of the City's current development charges services remain eligible under this tool. The mandatory 10% deduction has been removed for soft services, resulting in a higher recovery for eligible services. The legislation also introduces new exemptions.

- Alternative Parkland Dedication Bylaw (Planning Act, Section 42) – Parkland dedication remains largely unchanged, including the ability to levy alternative rates. In addition to new reporting requirements, a park plan must be in place before a bylaw is passed, which can now be appealed to the Local Planning Area Tribunal (LPAT).

- Planning Act, Section 37 – This tool has the most significant changes. The current "density bonusing" regime is replaced with the new Community Benefit Charges (CBC) that is capped at 4% of land value. A CBC strategy must be prepared and the bylaw for this tool, like the others, can be appealed to LPAT.
 

As a result of the above changes, the City is required to update its bylaws to meet the two year transition timeline set out in the provincial legislation (i.e. by September 2022). Given the municipal election in October 2022, the plan is to bring forward bylaws for Council consideration in Q2 2022. Without new bylaws in place by the deadline, the City's ability to collect growth-related funding will be restricted to development charges for eligible services and the fulfillment of executed density bonus agreements.

Work on this initiative is currently underway. In addition to an inter-divisional City team, a professional consulting team – Hemson Consulting Ltd., N. Barry Lyon Consultants and O2 Planning + Design – has been retained to lead the technical components of the project, notably the required background studies and strategies that underpin the determination of reasonable and defensible charges as required by provincial legislation, as well as an impact analysis. The review will include a comprehensive stakeholder engagement process that is supported by an external consultant. This review is a collaborative effort and is supported by staff leads and teams in all impacted agencies, boards, commissions and divisions across the City. 

The requirement to update all three bylaws concurrently over the next 12 months makes this initiative significantly more complex and time consuming than similar efforts in the past. This will be a large undertaking for divisions across the City and particularly for the core team advancing this work. 

An interim report will be brought forward to Council in fall of 2021, including updates on the engagement efforts and technical studies, prior to the statutory public meeting and Council consideration in 2022.