Comments on Development Charges Study

Last Wednesday there was a public participation meeting at 4pm in Middlesex Centre Council chambers. Unfortunately only two members of the public (including myself) and one member of the press were able to make the meeting, but a consultant named Andrew from Watson & Associates Economists Ltd. was on-hand to give a presentation of the background study, its conclusions, and a proposed development charge bylaw to replace the existing bylaw.

The most important takeaway from the proposed bylaw is that Middlesex Centre will move from varied development charges in Ilderton, Ilderton West, Komoka, Kilworth and Delaware to a single, uniform development charge. This will make things simpler for developers, easier for the municipality to apply, and also far easier for the municipality to project revenues. It’s win-win.

Answers to questions I asked at the meeting are as follows:

  • School boards are exempted from paying development charges under the Development Charges Act. This was a huge blow to further development in Delaware since the London District Catholic School Board didn’t have to pay development charges for the new Our Lady of Lourdes.
  • We are recouping 100% of what we can as allowed under the Development Charges Act.
  • Development charges will be indexed based on StatsCan data.

Upon further review of the data and proposed bylaw in the study, I came to some additional concerns that needed to be submitted. I wrote the email below and sent it to the Clerk for inclusion in Wednesday’s agenda as a comment on the background study.


I am submitting these comments for inclusion in Council’s agenda for the upcoming Council meeting on July 23, 2014 regarding changes to the proposed development charges by-law.

I have read the report and proposed by-law assembled by Watson & Associates Economists Ltd, and I have some concerns that are not addressed in the report or analysis.

  1. There are no provisions here for recovering costs associated with expanding police services to new developments. The provincial development charges law provides provisions for recovering 100% of the costs associated with police detachments, police rolling stock, and small equipment & gear. At the public meeting on July 16, 2014 I was told by Andrew, from Watson & Associates, that the proposed by-law would institute development charges to recoup 100% of the eligible fees. At the moment, this does not appear to be true. At a time when police services costs are skyrocketing, I feel it’s extremely important to set aside funds, collected through development charges, to help Middlesex Centre cope with rising police services costs.
  2. The development charge for libraries that is proposed to be levied against apartments appears to be artificially low. Apartment dwellers are just as likely, if not more likely depending on their demographic, to utilize libraries.
  3. In 2013 I was told by my Councillor that Public Works had to defer purchasing a new vehicle due to financial constraints. And yet the proposed development charges for Public Works has been reduced compared with existing fees. Why is that? I cannot find justification in the document.
  4. The table on page 113 clearly illustrates that the Water Reserve Fund will begin experiencing substantially negative cash flow, and will be in deficit by the year 2022. This deficit continues until 2034. Given the lack of major projects that the Water Reserve Fund will finance, in direct contrast with the Waste Water Reserve Fund, I encourage Council to consider increasing the Water development charge slightly in order to reduce the municipality’s debt, if not avoid it entirely with respect to the Water Reserve Fund.
  5. Lastly, I’m disappointed that the graphs shown on Wednesday at the public meeting – graphs illustrating how high/low Middlesex Centre’s current and proposed development charges are and will be in relation to nearby municipalities – are not included in the background study. I thought these were good fodder, but now I can’t reference them.

In light of the issues and questions above, I am urging Council to defer this back to staff for further review. I believe we’re very close to having an effective development charges by-law for 2014, but we are not quite “there” yet.

Thank you,

Derek E. Silva

A member of the public and a member of Council both expressed an interest in knowing what would happen if we reduced the industrial development charge to $0, hoping it would entice more industry to Middlesex Centre. This is something that several municipalities near us have already done including London, Woodstock, and St. Thomas. Given the lack of “big wins” over the last few years, I don’t see this strategy working. For starters it means the slack would have to be picked up elsewhere, and that elsewhere would almost certainly be property taxes. In addition to that, every economist I follow, and every discussion about where to set up a new business I’ve been privy to, has rarely (if ever) mentioned development charges as part of the conversation.

What is discussed instead is the labour force available, the land available, access to infrastructure, and so on. Access to infrastructure, especially Internet infrastructure, is something we could focus and have a direct effect on. Waiving development charges on new industrial buildings just means citizens are subsidizing the development charges instead. I cannot vote in favour of that, but that is the road some will try to take us down.

If you would like to learn more about the Development Charges Act, or the proposed bylaw for Middlesex Centre, I am happy to answer any questions!