HomeMy WebLinkAboutFIN 26-19PICKERING
Report to
Council
Report Number: FIN 26-19
Date: December 16, 2019
From: Stan Karwowski
Director, Finance & Treasurer
Subject: Trillium Housing Oak Non -Profit Corporation - Request to Defer Payment
of Development Charges
Recommendation:
1. That Report FIN 26-19 of the Director, Finance & Treasurer be received;
2. That, pursuant to By-law 7595/17:
a) the request by Trillium Housing Oak Non -Profit Corporation to defer the
payment of the City's share of Development Charges estimated to be
$2,620,000 prior to any increase in any Development Charge Fees and the
deferral be to December 14, 2020 be approved;
b) that Trillium Housing Oak Non -Profit Corporation be required to enter into a
Development Charge Deferral Agreement with the City on terms satisfactory
to the Director, Finance & Treasurer and the Director, Corporate Services &
City Solicitor;
3. That Council direct staff to develop a Development Charge deferral payment
strategy for Trillium Housing Oak Non -Profit Corporation for the City Share
Development Charge payments with an effective start date of December 15, 2020
that meets the legislation and regulations of the day; and
4. That the appropriate City of Pickering officials be authorized to take the necessary
actions as indicated in this report.
Executive Summary: During the last federal election, all of the major political
parties recognized the need to address and/or provide affordable housing. Today, there
is a need in Pickering/Durham Region to provide affordable housing.
In order to assist Trillium Housing Oak Non -Profit Corporation (Trillium), it is proposing
to build a 212 entry level town houses (2 phases) and to provide affordable financing for
up to 100 income -eligible buyers. Trillium is asking the City to defer payment of
FIN 26-19 December 16, 2019
Subject: Trillium Housing Oak Non -Profit Corporation - Request Page 2
to Defer Payment of Development Charges
development fees from building permit issuance to 120 days after first occupancy of
each phase.
Bill 108, More Homes, More Choice Act, 2019, received Royal Assent on June 6, 2019.
It is anticipated that Bill 108 will become fully proclaimed as of January 1, 2021 based
on draft regulations. Under Bill 108, changes were made to the Development Charges
Act, whereby soft services currently charged in the existing development charge fee
such as recreation, libraries and studies will no longer be part of the development
charge but instead will form part of the new Community Benefits Charge or CBC. The
City's work plan is to introduce the CBC By-law and revised Development Charge at the
December 14, 2020 Council meeting. Therefore, Recommendation 2a) will meet the
goal of deferring the Development Charge payments under the old legislation until
Council passes or adopts the new CBC By-law and revised Development Charge By-
law that is anticipated to be December 14, 2020.
Recommendation 3 fulfills the spirit and/or intent of the City to support the deferral of
Development Charge payments for Trillium based on legislation and regulations
applicable to at that time. Unfortunately, the regulations that relate to the CBC haven't
yet been issued by the Province and that is why the City has to adopt this two-step
process.
Under recommendation 2a), the deferral will not result in any reduction in the amount of
the development charges paid to the City by Trillium.
Financial Implications: Deferral of the payment of development charges will not
result in any loss of Development Charge revenue for the City. There will be no
requirements to secure the deferral. The deferral of development charges delays the
receipts of revenue and impacts the cash flow position of the Development Charge
reserve funds.
Discussion: The Council of the City of Pickering adopted Report FIN 28-17 of the
Director, Finance & Treasurer on the 2017 Development Charges Study and enacted
By-law No. 7595/17 of the City's current Development Charge By-law. The
Development Charge By-law requires payment of development charges prior to
issuance of a building permit.
Typically, a municipality will consider a request to defer the payment of development
charges when it is in the broader community interest to do so. The Trillium proposal
meets this test.
FIN 26-19 December 16, 2019
Subject: Trillium Housing Oak Non -Profit Corporation - Request Page 3
to Defer Payment of Development Charges
The Trillium Housing model was created 5 years ago. It is a unique process that brings
housing affordability within conventional housing developments. Trillium Housing Oak
Non -Profit Corporation has 3 principals and outsources activities like mortgage
brokerage and sales teams. In addition, their developer partner VanMar has been in the
construction business for over 30 years, and currently has well over 1,000 housing units
in production. The 3 principals have over 100 years in combined experience in housing
development, finance, construction and management. The 3 principals have also had
leadership positions in organizations such as Mainstay Housing, Toronto Community
Housing and Canadian Mortgage Housing Corporation.
During 2020, staff in conjunction with Watson & Associates will continue to monitor the
legislation and/or regulations as they pertain to Development Charges and/or the CBC
to ensure that the City's Development Charge deferral for this project meets current and
future legislative requirements. Staff have also informed Trillium that they should also
continue to monitor the applicable legislation to identify new opportunities and to ensure
that they are aware of any and all possible legislative changes that may impact their
project.
Attachments: None
Prepared/Approved By:
Start Karwowski, MBA, CPA, CMA
Director, Finance & Treasurer
Recommended for the consideration
of Pickering City Council
Tony Prevedel, P.Eng.
Chief Administrative Officer