Date:                     September 24, 2014

To:                        Media

From:                    Robert Kirwan
                             Candidate for Councillor of Ward 5

Re:                        Kill The Development Charges

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The City of Greater Sudbury must come up with a strategic action plan that will stimulate the local economy as quickly as possible. We cannot afford to spend any more time hiring consultants and preparing committee reports that say the same thing over and over again. We need to take action.

I will be proposing that City Council consider the immediate elimination of the development charges for new homes, apartments and businesses. I will also be proposing that instead of charging developers for the off-site costs of bringing city services to their property line, we accept this cost as the city’s investment in our future.

By removing the financial barriers that are holding back development and preventing people from having enough money to build their new homes, we will have a better chance of attracting new businesses to the area and we will enjoy the economic benefits of a once again robust construction industry.

I feel that the financial analysis will back up this proposal and demonstrate to Council that this plan will not result in a loss of future revenue, but will actually increase future revenue many times over what the development charges were anticipated to raise.

For example, during the period from 2006 to 2008 we were averaging almost 500 single detached new homes being built per year at a development charge of about $3000 which produced $1.5 million per year. In 2013 we saw 208 new homes built with a development charge of almost $15,000 for a total “one-time” revenue of $3 million. But if we would have built 500 new homes in 2013 we would be receiving property taxes of $2.5 million from those homes “every year” from now on. So we are actually losing $1.5 million per year in future revenue because of the loss of those extra 300 homes.

We need to boost our economy today, not in five years. So we need to do something that will be an incentive for people to build their new house. That will free up their current house or apartment for someone else who may not be able to afford a new house and we can just imagine the spin off effect that will result.

The second part of my proposal is the removal of the financial obligations on developers who are being inundated with enormous extra fees and charges even before they put the shovel in the ground. We have a commercial developer who is ready to build a new mall in Valley East, but he is required to come up with $2 million before he even begins construction. By considering my proposal, we will be providing residential and commercial developers the incentive to get on with their projects in the immediate future instead of strangling them with red tape and extra costs.

These are two policies that the City Council can put into action immediately. We can then examine several other options to further stimulate the economy and gain leverage from the renewed construction industry. It is going to take a lot to bring the city back to life, but we need to get started right away and this is the quickest and easiest option. Further, it is one that will actually produce a positive return on our investment.

 For more information visit Robert Kirwan’s web site at www.robertkirwan.ca