The Town of Minto is increasing building permit fees to counter the rising cost of providing building department services.
During a public meeting on Feb. 21, chief building official Terry Kuipers explained building permit fees have not been reviewed or amended in the town since 2010.
“Back then there was a very modest increase to the existing building permit fees,” Kuipers stated at the meeting.
“Since then numerous legislative and economic changes have taken place within the industry. As such, an extensive review of the existing fee structure is justified as permit revenue has fallen behind current operating costs of enforcing the Building Code Act.”
The goal of the review is to maintain fair cost recovery for most permit types “so that no projects (are) subsidizing others,” the CBO explained in a written report.
From 2014 to 2016, the building permit revenue was budgeted at $120,000, and even though record construction values and permit numbers were attained in two of those three years, actual permit revenue did not exceed the amount budgeted, and the gap between revenue and the service cost has been increasing, the report states.
Even with revenue of $140,900 in 2016, Kuipers noted, the building department required just under $100,000 in tax support to operate the department.
Had the new proposed fee schedule been in place last year, he explained, revenue would have been up to $205,000, which would still leave a departmental deficit of about $31,000.
Under the new fee structure, which was approved by council at the meeting, building fees on a 1,500 square foot house with a 500 square foot garage, valued at $280,000, would rise from $1,520 to $2,000.
Fees for the same project in Wellington North would be $2,215, in Mapleton $1,800 and North Perth $1,495. Fees in both Mapleton and North Perth are currently under review, Kuipers notes in his report.
Fees to build a 5,000 square foot agricultural shed valued at $80,000, rise from $900 to $1,200 under the new structure.
Fees for a 500 square foot garden shed valued at $8,000, currently $250, will rise to $425. While the average cost of application processing and building code enforcement on such a structures is estimated at an average of about $963 across the municipality, Kuipers said the new fees were kept well below that level because, “Nobody wants to spend $1,000 for an $8,000 structure.”
Kuipers estimates the fee increases will generate approximately $50,000 per year, which will decrease the amount of tax-supported costs, raising revenue equivalent to a tax increase of approximately one per cent.
Mayor George Bridge commented the town has been trying to “hold the line” on building fees in recent years, but costs are catching up with the municipality.
“A lot of the regulations that have come down the pipe to us, [they] come with a cost,” said Bridge. “Every time you put a regulation in, there’s a cost to regulate it and that seems to come onto our heads.”
A bylaw to put the new fees into effect immediately was passed without opposition during the regular council meeting that evening.
Councillor Dave Turton declared a conflict of interest and deputy mayor Ron Faulkner was not present at the meeting.
