Development charges and an addiction to growth
Woolwich & Wellesley Township's Local Community Newspaper | Elmira, Ontario, Canada
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Development charges and an addiction to growth

In a purely speculative guess on how Breslau will develop, Woolwich is prepared to siphon $30 million from the pockets of new homebuyers over the next decade or so, that’s on top of the many more millions already slated for removal.

Development charges already add tens of thousands of dollars to the cost of a new home, giving lie to any discussion about “affordable housing” coming from the same politicians and bureaucrats mouthing such platitudes today.

Beyond the rationale of “growth paying for growth” that’s used to justify the ever-increasing fees on new houses, development charges are symptomatic of the growth mantra.

Despite talking about protecting the environment, combatting climate change and protecting farmland, local municipalities act in just the opposite way by encouraging growth.

Those who support growth will always argue the benefits outweigh the negatives. Growth is always good. The trouble is, they can’t ever prove it. What we do know is that, at the local level, each new home ends up costing more than it generates in revenue. In the short-term, however, the opposite is true. The money paid just to develop the land and construct a home – development charges and building permits, for instance – bring in tens of thousands of dollars in each case. Then there are the property taxes. The funds far outweigh the marginal cost of providing services to one more home.

Multiplied over hundreds of houses in a subdivision, that money adds up to a big boost to municipal coffers. Problem is, little if any of that money benefits existing residents of the community. Rather, the year-over-year growth in assessment is simply rolled into the budget – typically doled out by politicians and bureaucrats not to the public but to themselves in the form of raises and more hires.

No one ever says, “Hey, we have all this extra revenue, let’s cut everybody’s taxes.” That, at least, would provide some short-term compensation to existing residents inconvenienced by growth.

Over longer periods, growth brings increased demand for services – always overpriced in the case of governments – and, eventually, huge infrastructure costs.

The entire system of government and the economy are both predicated on growth. None of our politicians at any level is talking about reversing that trend, even though constant growth is by definition impossible. Life on a finite planet makes that clear.

The environmental impact of human activity is the clearest indicator of where growth is a problem. We use up non-renewable resources and we spew pollutants into the air, water and soil. That can’t go on forever.

Nor can we continue to pave over land, especially productive farmland, in perpetuity. That, of course, is one of the arguments made in favour of transit in the war on suburban sprawl; as with many policies, the reality is always different from the spoken platitudes.

Bringing the issue back to Woolwich and the Breslau connector road – a $30-million project, half of which is the cost of spanning the railway tracks – everyone buying a new home anywhere in the township will be paying for it. The rationale is dubious – there’s growth, so it should be built – but approving it is as simple as tacking on another fee to an already expensive purchase.

The impact of development charges on the affordability of housing is rarely discussed. More and more Canadians are getting used to the idea that they may never own a home, limited to becoming permanent renters whether or not that’s their preference. The rising cost of buying a home is ultimately reflected in higher rental rates, however, as the issues are linked. Not by any stretch of the imagination could it be said that buying a house in this area is affordable, particularly for first-timers. The crunch gets even larger the closer one gets to the GTA.

Each new fee only makes the situation worse.

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