The City of Chestermere Council gave second and third reading to the 2022 Off-site Levy Bylaw on May 17.
The city currently has water, sanitary, storm, transportation, and recreation as off-site levies.
During the May 3 Public Hearing for the Off-Site Levy Bylaw, Senior Engineer Community Growth and Infrastructure Mark Ruault explained from the off-site levy model, growth numbers, capital projects, and approved infrastructure off-site levies, the city calculated a weighted average based on the land that’s going to be developed within the next 25 years.
“It varies depending on where you are in the city. There’s a significant increase in the rate charged for the development industry for projects outlined,” Ruault said. “It ranged between an increase of 4.2 per cent, and 60 per cent, on average was about 30.4 per cent increase on the weighted average.”
For areas with stormwater, there was a significant increase from 2021 to the proposed 2022 levy, with a weighted average per centage increase of over 230 per cent.
Following the public hearing, city administration met with developers and discussed a working group to implement cost savings for off-site levy projects, concerns regarding significant yearly increases, a 50 per cent reduction from the stormwater levy rate increase, a 50 per cent rate reduction increase from transportation and stormwater, or the possibility of a true-up with the city.
“Developers were supportive of working together to try and save money. They don’t want it to be the city and consultants coming in and meeting with them, they want it to be a true partnership with developers, engineers, and contractors to come to the solution,” Ruault said. “That’s directly in line with what we were thinking, we’re really aligned with the development industry on this, everyone is on side, and that’s a great opportunity.”
Developers had concerns about significant year after year cost increases, although they were in agreement with the model, and agreed they had to pay their fair share of off-site levy costs.
Developers believed that a 50 per cent reduction in the stormwater levy rate increase was a reasonable balance between current and future developers, however, administration received mixed reactions about the 50 per cent rate reduction increase from transportation and stormwater.
“It was right down the middle on doing both,” Ruault said.
Developers also had concerns with the true-up option, as it didn’t align with their current business model and financial sales process.
“Their concern was additional administration burden on them and the city. They want to make sure they are seen as transparent, and they are paying their fair share,” Ruault said.
Ruault believed the 50 per cent reduction on the stormwater levy increase was the best option.
“It really comes down to working with developers, being seen as pro-development, and having massive increases. If someone comes to invest in your community, and you change the rates by 40 per cent in one year and don’t give them any time to adjust, that’s something you can’t weigh,” Ruault said. “It’s fair and reasonable it’s just a little hard because of the rapid increase. Taking it down, taking the sting from 40 per cent to 25 per cent gives me confidence. We want to make sure this is a development-friendly community. It’s a right balance.”
The stormwater off-site levy increase option would phase in the increase, provide more consistency to the change in the rates, provide time for the development industry to adjust and ensure the right amount is collected from developers.
“It would balance. We still want to grow and be open for business. With the stormwater, I do think there is some real innovation and savings there,” Ruault said
“I believe there are efficiencies to be established in working with the developers and their experts, trying to obtain better pricing, and trying to get the developers to actually fund and proceed with the upgrades as opposed to the city doing it,” Mayor Jeff Colvin said.
