City to double-down on developers

The city is once again threatening to double-down on development fees.

The Star reports that City officials are proposing a doubling of development charges on new condo and housing projects around the 416, a jump that would see charges go from about $8,300 for a one-bedroom condo to $17,350! Needless to say, that’s an increase that would be passed directly on to buyers. On the cusp of what could be a few months’ worth of buyers’ market, could the timing be worse?

Although scuttlebutt has it the new charges could kick in May 1, deputy city manager and CFO Roberto Rossini said the numbers were “very, very draft” and that it was “erroneous” to suggest any hikes would kick in that soon. BILD president Bryan Tuckey told the Star, “Historically, we have had a great working relationship with city staff when it comes to their development charges bylaw review, and we look forward to the same process as we start to dive into the details.” That’s what he said, although I’m sure he would rather have said, “ARRRGGGHHH!”

We’re doing something wrong here, and it’s not undercharging for development. In a recent column, I lamented the lack of visionary leadership when it comes to the proposed Toronto casino, and I have many times in the past lamented the lack of visionary leadership in city planning and architecture around here, so here’s my latest — where’s the vision when it comes to raising funds for infrastructure?

Here we are, deep into densification, creating a vertical Toronto that may one day join the more than 20 metro areas predicted to house more than 10 million people each by 2015. According to the Harvard Business Review Blog Network, 180,000 people move into cities each day! And yet, we don’t have spots in our schools, our roads (most of them expansion-proof thanks to a lack of vision 75 years ago) are so pothole-pocked you could lose a Chrysler in one, our emergency rooms overflowing, and our police presence scarce.

Clearly, we need money for infrastructure, but with the cost of housing in Toronto already staggering, is pushing up prices even more really the answer? We’re already in danger of creating a city only the affluent can live in.

How about we charge a usury fee to anyone who lives without but works within the 416? Since they’re not paying any other taxes to help keep up roads, police, fire and ambulance services, that seems fair. And if that means some jobs migrate outside the 416, that’s OK too. We’re still measuring “success” in population, when we should be measuring it in quality of life. I’m not overlooking the fact that 905ers pay plenty of taxes to the province and the Feds, but if you’re spending five out of seven days in Toronto and paying your property taxes in Brampton, that’s a hole that needs plugging. And if you want to charge Toronto residents to work in Markham, I’m OK with that too. Fair is fair.

How about a big, fat tax on cars downtown, period? Never mind the area code of the driver. We don’t have any pedestrian-only thoroughfares in the downtown core. Let’s just velvet-rope the whole thing, from Front Street to College, from Bathurst to Broadview, and not let a single car in. Use some of the leftover real estate from all those clean, green, beautiful pedestrian avenues we create to make giant parking lots at the periphery. Or double the PDI charge on new vehicles, instead of doubling the development fees on new housing.

Toronto homebuyers dodged a price bullet in 2009 when the market was just starting to recover from its short-lived but intense slump, and city officials proposed a 90% hike in development charges. The city at that time agreed to phase in price hikes over four years, so I guess we were warned, but that gave us a few years to come up with better solutions. So, where are they?

The paper Innovative Infrastructure Financial Mechanisms, commissioned by SmartGrowth BC with help from Infrastructure Canada, looks at commuter taxes and more as ways to raise funds for infrastructure. Among them: high occupancy toll lanes (we built ours at great expense without bothering to find out if they would alleviate traffic congestion or produce fewer emissions), a density gradient approach to development charges (infrastructure is more efficiently improved in areas with greater density), parking site taxes, land value taxation (separate from any structures or improvements), fuel tax transfers — the ideas are out there.

Any workable solution needs to comprise stable, predictable revenues used solely for infrastructure, so instead of jumping on the easy, unimaginative bandwagon of raising development fees, which will fluctuate with the market, let’s look for some visionary solutions. Better still, let’s put a hardcore capitalist like Kevin O’Leary in charge for a while, instead of all these politicians, and let him fill up the city coffers.