City of Regina Urban Planning 1 Development Charges The Good, the Bad & the Ugly Presented by: Shanie Leugner Canadian Institute of Planners, Winnipeg 2018
Welcome to Regina, Saskatchewan 2 Incorporated 1903 Population: 224,974 (2016) Geographic Size: 182 Sq KM Situated on a flat, treeless and largely waterless plain. Every tree is hand planted, and the lake first dug by hand shovel during the Depression.
From No Growth to Rapid Growth! 3 Housing Starts and Average MLS Price 4,000 $400,000 3,000 $300,000 2,000 $200,000 1,000 $100,000 0 $- 1990 1995 2000 2005 2010 2015 Total Starts MLS Sale Price
4 Perfect Storm Frameworks and policies to manage growth were not in place Long-term deferral of infrastructure renewal and expansion Fundamentally broken revenue system
Ohhh you actually want to shower on the second floor? 5
We re Growing, We re Actually Growing! 6
7 But Wait We Have No Money. Do Something, Quick!
8 That wasn t going to cut it Need Major system upgrades The Watson Report We had some issues
9 Fun with Front-Ending Fraught with Challenges & Risks Lack of Clarity Misunderstandings
We should create an actual policy 10 In 2009, turned Watson Report into City policy but not everything went smoothly
2010 to 2013 The Engine Years 11 Annual rate updates No policy change Front-end credits earned and redeemed Interest growing for differential rates City RAPIDLY GREW Raised Question: Are we ready for next phase of growth?
What the heck is an OCP? 12
New Official Community Plan 13 Developed over a three year period involving extensive engagement. 25 year plan for growth and change Growth horizon 300K population Community priorities complete neighbourhoods OCP financial policy viability direction: Develop a detailed phasing and financing plan for growth
Regina s Annexation History 14
BIG 15 Change s Gaps were highlighted in existing growth policy Shift needed towards growth pays for growth model Significant consideration of next phase of growth (to 300k)
Phasing and Financing Plan 16 Shift to What does it mean to developers from What does it mean for the taxpayers? Undertook data-driven, transparent and collaborative process to assess: Share of infrastructure costs paid by developers through development charges Share of infrastructure costs paid by taxpayers Impact of phasing growth on City cash flows and debt
Major Project Steps 17 Step 1 Step 2 Step 3 Step 4 Establish land base Were will Regina grow? Develop phasing options In what order should Regina build neighbourhoods? Identify projects What infrastructure projects are required to support growth? Examine the impact of changes to the SAF policy e.g. taxpayer vs. developer share
Step Land 1: Base Establish land base 18
19 Step 2: Develop Phasing Options
20 Step 3: Identify projects What capital projects are required? What are the estimated costs? When do we need to build them? What triggers them?
Step 4: Evaluate policy options Do all projects need to be SAF funded? Could some projects be provided directly by developers? 21 How much should taxpayers contribute to different projects? Should there be changes to Regina s reserve fund management principles?
Results: Impacts on City s Cash Flow $50,000 Option 1 Option 2 $50,000 22 $0 $0 -$50,000 -$50,000 (thousands $) -$100,000 -$150,000 (thousands $) -$100,000 -$150,000 -$200,000 -$200,000 -$250,000 SAF Deficit Current Average SAF deficit -$250,000 SAF Deficit Current Average SAF deficit -$300,000 -$300,000 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 $50,000 Option 3 Option 4 $50,000 $0 $0 -$50,000 -$50,000 (thousands $) -$100,000 -$150,000 (thousands $) -$100,000 -$150,000 -$200,000 -$200,000 -$250,000 SAF Deficit -$250,000 SAF Deficit Current Average SAF deficit -$300,000 -$300,000 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2027 2028 2029 2030 2031 2032 Current Average SAF deficit
23
Policy Shifts Were Made 24 #1 Developers pay directly for all internal infrastructure that provides direct benefit to their development #2 Shift interchange funding to 50-50 #3 #4 Eliminate taxpayers share of roadway widening projects Differential Rates for existing vs new neighbourhoods
25 Council Involved through Project Frequent engagement Explain implications of decisions Gave Council options
Results and Lessons Learned Phasing has major implications for cash flow 26 More consultation yields better results Taxpayers risks need to be considered It may not be possible to make everybody happy
27 2014 2015 Comprehensive Servicing Agreement Fee Policy review To lay strong framework for growth to 300,000
Collaborative Engagement Process Numerous stakeholder sessions with: 28 Regina & Region Homebuilders Association Local land developers Property owners Thorough Project Website Feedback Loop
Project website 29
More Policy Shifts Were Made 30 #1 Charges on broader system #2 #3 Endeavour to Assist policy added for area-specific projects Growth charged 100% of grade separations & interchanges #4 Growth costs assigned to intensification
Anticipated Outcomes 31 Long-term financial risk to taxpayers is minimized Market choice is available Neighbourhoods will build out faster Reasonable service provided to existing and new residents City can continue to invest in/ renew existing infrastructure 31
32 Policy Gaps Remained Infill Development Industrial Development
2017 POLICY UPDATE Industrial Development 33 RESULT: Industrial development policy reduced rate to be 1/3 of greenfield hectarage rate
2018 POLICY UPDATE Charging for Intensification 34 Costs for growth-related projects that benefit intensification were allocated accordingly in 2015 Costs amounted to $125 million to be paid 25 years Further consultation needed to determine the approach
Intensification Policy Update 35 Through stakeholder engagement process, determined: 1. Where the new intensification levy would apply 2. How and when the levy will be charged 3. How rates are determined and applied 4. How credit is given for existing development 5. What the implementation date is for policy and levy
Rates Based on Land Use Type 36 Land Use Types For comparison, Single Detached Ratio Rate Per Equivalent Population SAF in Greenfield: 1 $3,808 Residential ~ $24,000 Secondary Suite 1.3 $5,000 Single Detached 2.7 $10,300 Semi-Detached (e.g. duplex) 2.6 $9,900 More than 2 Dwelling Units (e.g. Townhouse, Triplex, etc.) 2.5 $9,500 Apartment (Less than 2 Bedrooms) 1.3 $5,000 Apartment (Two or More Bedrooms) 1.9 $7,200 Office/Commercial/Institutional (per m2) 0.02778 $110 Industrial (per m2) 0.01333 $50 Fees would not apply for: Residential renovations or additions Commercial or Industrial additions under 14m 2 for first intensification (min. threshold) Parking structures Structures without municipally-provided water and/or wastewater facilities, intended for seasonal use
37 Now What? Prepare for Intensification Levy implementation (2018/2019) - Build awareness Revisit Endeavour to Assist policy (2018/2019) Prepare for next Major SAF Policy Review (2020)
Big Lessons 38 Know your prioritie s Keep Talking Small Steps are better than no steps It s a marathon not a sprint
QUESTIONS 39