Report to: General Committee Finance & Administrative    Date of Meeting: December 3, 2007

SUBJECT:                          Development Charges Indexing January 1, 2008

PREPARED BY:               Kevin Ross, extension 2126

RECOMMENDATION:

THAT the report titled “Development Charges Indexing January 1, 2008” be received;

AND THAT Council approve an increase in development charges of 3.50%, effective January 1, 2008.

1. Purpose                2. Background         3. Discussion             4. Financial         5. Environmental

6. Accessibility       7. Engage 21st             8. Affected Units       9. Attachment(s)

PURPOSE:

The purpose of this report is to recommend the indexing of development charges, effective January 1, 2008, in accordance with the Statistics Canada Quarterly, Construction Price Statistic for non-residential buildings in Toronto.

BACKGROUND:

Section 15 of the Town’s Development Charge by-laws, enacted August 31, 2004, states that “the development charges referred to in Schedule “B” shall be adjusted semi-annually without amendment to this by-law, commencing on the first day of January and the first day of July, of each year commencing January 1, 2005, in accordance with the most recent change in the index (prescribed under the Development Charges Act) Statistics Canada Quarterly, Construction Price Statistics (Catalogue No. 62-007)”.

In accordance with the by-law it is recommended that the development charge be indexed 3.50%.  This represents the increase in the Statistics Canada Quarterly, Construction Price Statistic for non-residential buildings in Toronto for the second and third quarter of 2007.  Below is a history of the indexes approved by Council since the by-laws were enacted.

The Town continues to experience higher than expected costs for hard services (roads, bridges, watermains, sanitary sewers, property costs etc.).  An updated Development Charge Background Study is currently being prepared to reflect these increased costs and to include new growth related projects not previously included in the development charge.

FINANCIAL CONSIDERATIONS

The Construction Price Index includes costs associated with the construction of industrial, commercial and institutional buildings which more closely aligns with the costs incurred by the Town of Markham for these services. Indexing the Town’s Development Charges on a semi-annual basis will partially mitigate the impact of inflationary increases on future growth-related costs.  The Construction Price Index is not currently keeping pace with the actual costs being incurred on construction projects, as a result, the Development Charge by-laws (Town Wide Hard and Area Specific) are currently being reviewed.

RECOMMENDED

BY:    ________________________          ________________________

Barb Cribbett, Treasurer                     Andy Taylor, Commissioner

Corporate Services

ATTACHMENTS:

Exhibit A – Town of Markham Recommended Development Charges for January 1, 2008.

Appendix A:

Town of Markham

Recommended Development Charges

Effective January 1, 2008