Development Levies and/or Servicing Fees

Res #: 30-16A
Number: 30
Year: 2016
Midterm: No
Expired: No
Responses Received: No
Departments: Saskatchewan Ministry of Government Relations

WHEREAS the Province of Saskatchewan is experiencing increased growth and municipalities are facing increased infrastructure challenges related to this growth; and

WHEREAS there is considerable impact on municipal infrastructure for this increase in growth in which the costs are not realistically recoverable through property taxation; and
WHEREAS increased development contributes to escalated deterioration of existing infrastructure requiring significant repair and/or replacement of that existing infrastructure at a faster rate than if the development were not to occur, which results in an increase in property taxation on existing ratepayers due to the development; and
WHEREAS Section 172 of The Planning and Development Act, 2007, provides for municipalities to enter into servicing agreements with subdivision applicants and provides for the collection of fees as established by council as payment in whole or in part for the capital cost of providing, altering, expanding or upgrading sewage, water, drainage and other utility services, public highway facilities, or park and recreation space facilities, located within or outside the proposed subdivision, and that directly or indirectly serve the proposed subdivision; and
WHEREAS the Saskatchewan Municipal Board, Planning Appeals Committee has made a decision that they do not accept the argument that all residential subdivisions have an impact on municipal infrastructure to warrant the collection of servicing agreement fees and that they believe the intent of the legislation requires that different levels of burden need to be determined based on the intensity of subdivision which then defines the level of the fee that a servicing agreement can seek from an applicant; and
WHEREAS the Saskatchewan Municipal Board, Planning Appeals Committee in Appeal Decision PAC 2013-0004 stated that “The use of servicing fees is a rather blunt tool to attempt to fund capital infrastructure deficit.  A servicing fee could be legitimate if a new infrastructure cost to the RM can be directly attributed to a new subdivision”; and
WHEREAS the Saskatchewan Municipal Board, Planning Appeals Committee suggests that municipalities need to consider the use of development levies (sections 169-171 of the Act) as a preferable method to fund capital projects that result from new development projects, with the understanding that it is an onerous process; and
WHEREAS according to Section 169(2) of The Planning and Development Act, 2007, development levies can only be imposed where a development does not involve a subdivision of land; and
WHEREAS the Community Planning Branch of the Ministry of Government Relations has encouraged municipalities to collect adequate development fees to ensure that development pays their own way; and
WHEREAS it is the position of the municipality that every new subdivision in municipality has an impact on the infrastructure and that applicants of new subdivisions should have to pay a fee towards future infrastructure improvements as a result of that impact; and
WHEREAS ratepayers in a municipality have paid the costs for infrastructure development that future applicants take advantage of if the infrastructure already exists and should contribute to those infrastructure costs to reduce the burden of future infrastructure capital costs to existing ratepayers; and
WHEREAS the Saskatchewan Municipal Board supports the Government of        
Saskatchewan’s plan for growth by supporting local authorities, primarily municipalities, in ensuring fiscally sustainable growth as outlined in the Saskatchewan Municipal Boards 2014 annual report, yet recent decisions of the Saskatchewan Municipal Board’s Planning Appeals Committee has overruled fees that municipalities deem to be necessary for sustaining growth;

BE IT RESOLVED that SARM lobby the Ministry of Government Relations to undertake a complete review and amend Part VIII Development Levies and Servicing Fees, of The Planning and Development Act, 2007, in consultation with municipal stakeholders, to provide the ability for municipalities to charge fees that actually ensures development pays a  fair portion of the costs associated with the impacts on existing and future infrastructure from proposed developments in a manner which will be defendable to the Saskatchewan Municipal Board and transparent to all applicants.

View response from the Minister of Government Relations