Changes in provincial legislation could cost the City of Guelph $155 million in lost development charges over the next 10 years.
That was the dollar figure city treasurer Tara Baker delivered at Monday night’s city council meeting, an amount based on Bill 108 changes to the development charges act.
That lost revenue could jeopardize or adjust the timelines of some key city capital projects, including a new main library and a south end rec centre, council heard Monday.
The provincial changes affect if, when and how much the city can collect in development charges from developers.
There are other financial hits coming with the latest changes, Baker explained.
They include a potential $690,000 to $1.38 million hit to the city due to changes in public health funding.
There was also a projected $27 million additional provincial gas tax windfall over 10 years that has now been cancelled, money that would have gone to transit infrastructure.
Mayor Cam Guthrie, who is also the chair of the Large Urban Mayors Caucus of Ontario, called the lack of conversation between the province and municipalities “terrible.”
“There has been an absolute lack of consultation from the get-go,” the mayor said.
He did say there has been a “wake-up moment at the province in regards to the lack of consultation” and that some extended consultation periods have been announced.
Guthrie also noted that city staff have been “ripped away” from their regular duties as they try to come to grips with the provincial changes and what it means for Guelph.
“It’s very difficult, very difficult, when our own staff is ripped away from what they’re supposed to be doing,” the mayor said.
”Growth wasn’t already paying for itself and this is going to make the problem worse,” coun. Cathy Downer said.
She asked if this could change the city’s growth plans, given the added burden that growth could put on the city’s infrastructure funding.
“It’s a question a lot of municipalities are asking,” replied Todd Salter, the general manager of planning and building services.
Provincial growth targets may have to change, he added.
Coun. Phil Allt said it was a case of the province “spanking” the cities.
“My fear is that we’re going to seriously have to look at using our reserves at this point,” Allt said of next year’s city budget.
Baker said the effect on the tax rate next year is still unknown, but the city is in a “good, stable financial place” to help wade through the changes.
“If we have to use them (city financial reserves), over the next number of years, that’s okay and we’ll plan around that,” Baker said.
Coun. Mike Salisbury floated the question of the city potentially placing a moratorium on development.
“What would it look like if we said ‘we can’t afford to build new homes,’” Salisbury asked staff.
The answer was the province could reject such a move by the city.
“Then the province comes in and plans your community for you,” the mayor said.
Baker said many of the changes still need clarification from the province.
“We’re concerned at this point, but looking forward to being part of the conversation,” Baker said of upcoming consultations with the province.
