Developers in St. Albert could be seeing an increase of just over $20,000 per hectare in off-site levies (OSLs), after cost estimates for widening north St. Albert Trail more than doubled.
The levy increase is a “tough pill to swallow,” and some developers are calling for increased involvement in how the city manages infrastructure projects, after it came to light developers will bear the brunt of increased estimated costs to St. Albert Trail construction.
Last month, developers were told at an information session estimated costs for North St. Albert Trail widening had increased from $14.2 million to $38.2, and while the city has said it will not have to borrow additional money for the project, developers will be paying higher OSLs as a result.
Dave Dyrbe of Kota Contracting, which owns land in the Lakeview Business District, told the Gazette St. Albert already has some of the highest off-site levies in the region and called the OSL increases “horrible.”
“The city would like to get going with commercial industrial (in Lakeview); we're having a tough time going because there's a bunch of service work that needs to be done that we, as a developer, cannot pay for upfront,” Dyrbe said.
“The levies were an issue. They're even more of an issue now ... they’ve made that issue worse.”
A levy rate comparison between other municipalities, included in a presentation to council during last year’s OSL bylaw update, showed St. Albert had the second highest rate, just behind Edmonton.
Melcor Developments vice-president Sue Monson agreed that levies are already quite high, so the increase is a “tough pill to swallow.”
She presented at city council’s community growth and infrastructure meeting as an Urban Development Institute (UDI) Edmonton region board member. She spoke about the mutual dependency developers and the city have on each other for executing and funding growth capital projects.
The UDI is calling for St. Albert to form a steering committee for off-site levy projects, Monson said, to give developers greater input into what projects go into the OSL model and scope of those projects.
“There's supposed to be some kind of checks and balances in place to ensure that the city doesn't build the Taj Mahal, then developers pay for it when really they could just build kind of like the basic version of it. And if they want to add more bells and whistles, that would be a city initiative.”