City council gave a thumbs-up to new offsite levy rates that will see developers pay for the vast majority of new growth instead of current taxpayers.
Councillors on Monday unanimously passed second reading of the offsite levy bylaw that, when formally approved next month, stands to make St. Albert one of the most expensive places to develop land in the Capital region.
The new rates will charge developers half the city’s total bill for all three phases of Ray Gibbon Drive and 95 per cent of the cost for new water reservoirs and pump houses for new development in the annexed lands — a $95-million tally.
An early draft of the bylaw had the city picking up those costs, an idea council rejected in November amid public pressure.
The new levy structure was opposed by the Urban Development Institute (UDI), an industry lobby group, which said the decision would make it too expensive to build here.
In a letter, UDI chair Patrick Shaver warned, “Cities stagnate very quickly when people stop moving in. We believe it imperative that St. Albert continue to grow to maintain its uniqueness and competitiveness in the region.”
UDI executive director Michael Mooney said the proposed fees are going to drive up the cost of housing.
“You are going to be on the wrong side of where the market is today,” he said. “When you get out of a price range development stops.”
Mayor Nolan Crouse said he wasn’t swayed by the industry arguments and believes the city will still see plenty of growth.
“Over a 20- or 30-year period this is a non-issue, and even over the short term I believe we are still going to see development.”
Coun. James Burrows said even though the higher fees will be passed on to new homeowners the quality of life in St. Albert will keep attracting new residents.
“People will still move to St. Albert because they understand that they want to have a quality of life in metropolitan Edmonton that is second to none.”
Burrows said shifting some of this infrastructure burden would only have hurt taxpayers in the long run making the city a less affordable place to live.
The bylaw sets levies on a per hectare basis, based on the area of the city a developer is working in.
Developers will pay the city $267,235 per hectare in the western portion of the annexed lands, and $269,365 in the north. In the pre-annexation area, development will cost $147,902 in the east and $224,145 in the west.
Crouse recognized St. Albert’s levies are not cheap, however he also stands fast in the opinion that growth has to pay for itself.
“We are not going to compete to the lowest levels on these levies,” he said. “Our taxpayers should not be paying for growth.”
Crouse said Ray Gibbon Drive serves city residents today and will be of great benefit to future residents in the annexed lands, so it makes sense that they pay for it.
“Some would argue that [it serves] growth and some would argue that it is serving the greater good of the community and I can see both side of the argument,” he said. “That is why it is 50-50.”
The annexed lands are especially costly because the servicing for that area will have to start from scratch, with new roads, sewers, water mains and reservoirs.
Crouse said other municipalities that have serviceable land today will run out of it in the near future and will be facing the same hurdles St. Albert has.
The bylaw will undergo minor spelling and wording changes before council considers third and final reading on Feb. 28.
