Council here wants to ensure local development charges don’t become an impediment to small business growth in the township.
At the June 28 meeting, council directed staff to consider options to reduce development charges for projects such as workshop construction in rural areas.
Council was reacting to correspondence from Mapleton resident Elmer Bearinger, whose family operates a small welding/repair shop in the Moorefield area.
Bearinger had applied for a building permit for a planned new workshop but was stunned to learn the project would be subject to $35,000 in development charges.
“We were led to believe that we were now at the final stage and cost – the building permit. The actual cost of the permit at $4,700 we feel is very fair and we will gratefully and willingly pay it,” states a letter from Bearinger.
“But when we were informed that our permit is ready, we were told the total amount is $40,000. This was quite a shock and our first thoughts were that there must be a mistake somewhere. After being informed that the added $35,000 was for development charges, we felt deceived, as we had not ever been informed of the possibility of being subject to these charges.”
Bearinger notes he runs a small operation involving only two or three workers and, although he has tradesmen lined up to begin the expansion, he is considering cancelling the project because of the development charges.
“Perhaps $35,000 is considered as a small amount in the figures you are used to dealing with, but it is hard for a small business to justify this and simply absorb it. We are presently, and have for quite awhile, been paying commercial taxes. The proposed expansion would increase that amount substantially of which we are aware of and accept,” he states in the letter.
Councillor Marlene Ottens asked “why this particular business is getting these heavy development charges and not other rural businesses?”
CAO Brad McRoberts explained “in this case Mr. Bearinger is not being specifically picked out because of the type of business, but because it (the workshop) is new. New business is going to create a certain amount of service needs.”
Councillor Lori Woodham wondered how the township could ensure future applicants don’t end up getting surprised by development charges.
“How can we ensure that this doesn’t happen again? How can we be more transparent or open or how can we communicate this to the applicants that come in?” she asked.
While noting he would be reluctant to provide a specific figure when an application is filed, McRoberts said, “we could make a person aware there is a development charges bylaw.”
Mayor Neil Driscoll read a resolution directing staff to consider options for reducing development charges for similar projects.
“Frankly the impact this business is going to have on our roads, on our fire system, it’s minimal,” said Driscoll.
“The biggest thing is they were doing it right and there’s so many business in our municipality that are operating illegally … and some of them brag about it, but we didn’t see it happening.”
The mayor also pointed out, “We have other buildings that are being built in Mapleton every day and they aren’t being charged any development charges and they’re using our roads with their manure tanks.”
Councillor Michael Martin questioned the need for such extensive development charges.
“I understand what they’re for, but I almost feel that perhaps they’re used as a revenue generator at times … I don’t believe that the township will have any added costs if this workshop is constructed, or any workshop is constructed out in the rural area.”
McRoberts explained development charges can only be used for development-based projects “for example if a road needs to be upgraded because of growth leading to increased traffic.”
Councillor Dennis Craven said, “The best way to keep business from coming to the municipality and driving them away is to have huge, huge development charges.”
Martin expressed concern the resolution as worded could lead to a solution going forward, but wouldn’t help the Bearingers.
McRoberts explained any changes to the development charges bylaw couldn’t be made to apply retroactively to the Bearingers’ situation.
However, he noted Bearinger could cancel his application and reapply under the new regulations.
Councillor Lori Woodham noted “it could still be a long process to correct it.”
McRoberts said council could probably look at the development charges bylaw towards the end of September or in October.
Council approved the resolution directing staff to consider options for reducing development charges on projects of this nature.
Under a development charges bylaw passed in April of 2015, fees for commercial and industrial development were set at $3 per square foot of gross floor area in urban areas and $2.61 in rural areas. Those rates represented a reduction from the previous rate of $3.21 per square foot for both urban and rural projects.
