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The impost fee and development cost charge in British Columbia Kuroyama, Kazumi Alan 1979

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THE IMPOST FEE AND DEVELOPMENT COST CHARGE IN BRITISH COLUMBIA by KAZUMI ALAN KUROYAMA B.A. U n i v e r s i t y of V i c t o r i a , 1973 A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS i n THE FACULTY OF GRADUATE STUDIES The School of Community and Regiona l P l a n n i n g We accept t h i s t h e s i s as conforming to the r e q u i r e d standard THE UNIVERSITY OF BRITISH COLUMBIA September 1979 © Kazumi A l a n Kuroyama, 1979 In presenting th i s thesis in pa r t i a l fu l f i lment of the requirements for an advanced degree at the Univers ity of B r i t i s h Columbia, I agree that the Library shal l make i t f ree ly avai lable for reference and study. I further agree that permission for extensive copying of th i s thesis for scholar ly purposes may be granted by the Head of my Department or by his representatives. It i s understood that copying or publ icat ion of th i s thesis for f inanc ia l gain shal l not be allowed without my written permission. Department of Graduate S t u d i e s  School of Community and Regional P l a n n i n g The Univers ity of B r i t i s h Columbia 2075 Wesbrook Place Vancouver, Canada V6T 1W5 Date October 15, 1979 ( i i ) ABSTRACT The main purpose f o r undertaking t h i s study i s to p r o v i d e f a c t u a l i n f o r m a t i o n on impost fees and develop-ment c o s t charges i n B r i t i s h Columbia. The g e n e r a l aim of the study i s to impart a b e t t e r understanding of the two concepts, p a r t i c u l a r l y with r e f e r e n c e to t h e i r purpose and the circumstances causing t h e i r e v o l u t i o n . T h i s study has four o b j e c t i v e s : 1. to determine and d i s c u s s some of the major f a c t o r s and events which prompted the m u n i c i p a l i t i e s i n B r i t i s h Columbia to c o n s i d e r and adopt the l e v y i n g o f impost f e e s ; 2. to c l a r i f y the philosophy and implementation s t r a t e g i e s of the impost fee concept and determine the extent of i t s use i n B r i t i s h Columbia p r i o r to the advent o f the development c o s t charge l e g i s l a t i o n ; 3. to determine and d i s c u s s some of the major f a c t o r s and events which prompted the p r o v i n c i a l government to a b o l i s h impost fees and i n t r o d u c e development c o s t charges; and, 4. to examine and s y n t h e s i z e the development c o s t charge l e g i s l a t i o n to a s c e r t a i n i t s p h i l o s o p h y , purpose and the requirements p r o v i d e d t h e r e i n , as w e l l as to determine the extent of i t s c u r r e n t use i n the p r o v i n c e . The i n f o r m a t i o n r e q u i r e d to s a t i s f y these o b j e c -t i v e s was c o l l e c t e d i n three d i s t i n c t ways: (1) i n t e r v i e w s ( i i i ) w i t h o f f i c i a l s and r e p r e s e n t a t i v e s from v a r i o u s m u n i c i p a l i -t i e s and the M i n i s t r y o f M u n i c i p a l A f f a i r s , (2) a q u e s t i o n -n a i r e which was forwarded to 36 l o c a l i t i e s i n the p r o v i n c e , and (3) review of the l i m i t e d amount of l i t e r a t u r e r e l a t i n g to the s u b j e c t matter. T h i s study has d e r i v e d f o u r o b s e r v a t i o n s : 1. The impost fee concept evolved from the m u n i c i p a l i t i e s ' search f o r an a l t e r n a t e source o f revenue to o f f s e t the f i n a n c i a l l i a b i l i t i e s c r e a t e d by t h e i r r e s t r i c t i v e modes of revenue g e n e r a t i o n and the i n c r e a s i n g demands f o r a d d i t i o n a l expenditures. More s p e c i f i c a l l y , t h i s fee was found to be a d i r e c t r e s u l t o f m u n i c i p a l s t r a t e g i e s to a l l e v i a t e the c o s t burdens c r e a t e d by urban p o p u l a t i o n growth. 2. The commonly accepted d e f i n i t i o n o f an impost fee i s : a l e v y which i s assessed a g a i n s t a developer by a m u n i c i p a l i t y to d e f r a y the m u n i c i p a l c o s t s o f c o n s t r u c -t i n g o r expanding s e r v i c e s n e c e s s i t a t e d by new develop-ments. I t was p e r c e i v e d t h a t the b a s i c i n t e n t o f the impost fee was to meet the demand and c o s t s f o r new and improved s e r v i c e s by imposing a f i n a n c i a l r e q u i r e -ment on those lands t h a t c r e a t e d the demand. A q u e s t i o n n a i r e survey, conducted i n January and February of 1977 r e v e a l e d t h a t a number of m u n i c i p a l i -t i e s had adopted the impost fee'concept. Of the 36. survey l o c a l i t i e s , i t was found t h a t 21 or s l i g h t l y more than 58 per cent l e v i e d some form of impost. (iv) 3. The demise of the impost fee concept was found to be a t t r i b u t a b l e to the m u n i c i p a l i t i e s 1 abuse o f the l a n d use c o n t r a c t p r o v i s i o n of the M u n i c i p a l A c t . Evidence showed the p r o v i n c i a l government f e l t the l a n d use c o n t r a c t c o n t r i b u t e d to i n c o n s i s t e n c i e s i n the develop-ment and s u b d i v i s i o n approval process, was being used by some m u n i c i p a l i t i e s to r e q u i r e e x c e s s i v e l y high s e r v i c e standards from developers, and was unduly i n c r e a s i n g the c o s t of housing. F u r t h e r r e s e a r c h showed t h a t w h i l e the p r o v i n c i a l government was sympathetic towards the m u n i c i p a l i t i e s ' f i n a n c i a l problems i n terms of f i n a n c i n g s e r v i c e s f o r new development areas, i t was r e l u c t a n t to grant muni-c i p a l i t i e s u n l i m i t e d t a x i n g power to a c q u i r e revenues f o r t h i s purpose. T h e r e f o r e , the p r o v i n c i a l government granted the m u n i c i p a l i t i e s the l e g i s l a t i v e power to impose development c o s t charges s u b j e c t to a number of r e s t r i c t i o n s and requirements, s t i p u l a t e d i n the l e g i s l a t i o n . 4. The purpose of the development c o s t charge was found to be b a s i c a l l y the same as the commonly accepted purpose of the impost fee; t h a t being t o : "provide the m u n i c i p a l i t y w i t h a source of revenue so t h a t the m u n i c i p a l i t y may c a l l upon i t s banked c a p i t a l c o s t charges to pay f o r a major c a p i t a l expenditure t h a t becomes necessary i n r e l a t i o n to i t s highways, sewer, water, drainage, or park systems". I n v e s t i -g a t i o n s i n d i c a t e d t h a t the p r o v i n c i a l government's (v) philosophy behind the development c o s t charge p r o v i s i o n was to make the l e g i s l a t i o n r e g u l a t o r y , uniform and t a x i n g . A n c i l l a r y to t h i s , " c e r t a i n t y " was to be r e i n s t a t e d i n the development p r o c e s s . A survey conducted i n J u l y o f 1979 r e v e a l e d t h a t 19 l o c a l i t i e s have a l r e a d y taken advantage of t h i s l e g i s -l a t i o n and had enacted development c o s t charge by-laws. A review of the development and s u b d i v i s i o n approval process i n the M u n i c i p a l i t y o f Richmond showed "that the development c o s t charge p r o v i s i o n o f the M u n i c i p a l Act does not r e p r e s e n t the o n l y means a v a i l a b l e to the m u n i c i p a l i t i e s to a c q u i r e s p e c i f i c revenues from dev e l o p e r s . I t was found t h a t by e x e r c i s i n g t h e i r a d m i n i s t r a t i v e power, m u n i c i p a l i t i e s can en t e r agree-ments wi t h developers - much l i k e the l a n d use c o n t r a c t - and c o n t r a c t with them to pro v i d e revenues to be used i n much the same manner as development c o s t charges. TABLE OF CONTENTS (vi) Page ABSTRACT ( i i ) TABLE OF CONTENTS (vi) LIST OF TABLES ( v i i i ) ACKNOWLEDGEMENT (ix) CHAPTER ONE: STUDY FORMAT 1.1 I n t r o d u c t i o n 1 1.2 Study Purpose 2 1. 3 Work Program 3 1.4 Study O u t l i n e 5 CHAPTER TWO: BACKGROUND INFORMATION 2.1 I n t r o d u c t i o n 8 2.2 The Government S t r u c t u r e and the D i v i s i o n of Power 9 2.3 M u n i c i p a l Governments i n B r i t i s h Columbia 13 2.4 Functions and R e s p o n s i b i l i t i e s of M u n i c i p a l Governments 18 2.5 Summary and Conclusions 20 CHAPTER THREE: FINANCIAL IMPLICATIONS OF MUNICIPAL GOVERNMENT 3.1 I n t r o d u c t i o n .' 22 3.2 M u n i c i p a l Expenditures . • . 22 3.3 M u n i c i p a l Revenues 2 6 3.4 The F i n a n c i a l I m p l i c a t i o n s o f M u n i c i p a l Expenditures and Revenues . . . . 32 3.5 Summary and Conclusi o n s . 43 ( v i i ) CHAPTER FOUR: THE IMPOST FEE IN BRITISH COLUMBIA: 1960-1977 4.1 I n t r o d u c t i o n 4 7 4.2 The Impost Fee - The Concept 4 8 4.3 The Impost Fee i n B r i t i s h Columbia -An H i s t o r i c a l Overview (1960-1977) . . . . 50 4.4 A Survey of the Impost Fee i n B r i t i s h Columbia (1977) . . 59 4.5 Summary and Conclusions 71 CHAPTER FIVE: RECENT LEGISLATION AMENDMENTS AFFECTING THE IMPOST FEE 5.1 I n t r o d u c t i o n 75 5.2 " B i l l 42" - An H i s t o r i c a l Overview . . . . 76 5.3 Development Cost Charges 82 5.4 A Survey of the Development Cost Charge i n B r i t i s h Columbia (1979) 94 5.5 The Advantages and Disadvantages of the Development Cost Charge L e g i s l a t i o n 100 5.6 Summary and Conclus i o n s 105 CHAPTER SIX: SUMMARY AND CONCLUSIONS 6.1 Summary , 109 6.2 Conclusions 116 6.3 Suggestions f o r F u r t h e r Research 118 6.4 I m p l i c a t i o n s f o r P l a n n i n g 120 BIBLIOGRAPHY 122 APPENDICES 128 ( v i i i ) LIST OF TABLES Page Table 1 The Amounts of Annual M u n i c i p a l Revenues Derived from Real P r o p e r t y Taxation and P r o v i n c i a l A s s i s t a n c e i n B r i t i s h Columbia, Showing Percentages of T o t a l Annual M u n i c i p a l Revenues, 1 9 6 2 - 1 9 7 7 . . . . 3 0 Table 2 The Annual Amounts of Revenue Derived from Real P r o p e r t y T a x a t i o n Apportioned to School D i s t r i c t Purposes i n B r i t i s h Columbia, 1 9 6 2 - 1 9 7 7 4 1 Table 3 The T o t a l Annual Expenditures f o r S o c i a l Welfare, Showing P r o v i n c i a l Government and M u n i c i p a l Government C o n t r i b u t i o n s , 1 9 6 2 - 1 9 7 7 4 2 Table 4 The Amounts of Impost Fees by Type of Dwelling U n i t s i n the C i t i e s of B r i t i s h Columbia - As of March 3 , 1 9 7 7 . . « 6 2 Table 5 The Amounts of Impost Fees by Type of Dwelling U n i t s i n the M u n i c i p a l D i s t r i c t s of B r i t i s h Columbia - As of March 3 , 1 9 7 7 6 3 Table 6 A L i s t of L o c a l i t i e s i n B r i t i s h Columbia Which Have Received Approval from the Inspector of M u n i c i p a l i t i e s to Impose Development Cost Charges, Showing the A p p l i c a b l e Land Uses f o r Each L o c a l i t y , As of J u l y 4 , 1 9 7 9 . . . . . . . 9 9 (ix) ACKNOWLEDGEMENT _ , _ / "—\ The author r e c e i v e d a s s i s t a n c e from a number of people who s u p p l i e d v a l u a b l e i n p u t i n t o t h i s study. Thanks go t o : Mr. W.T. Lane and Mr. B. Wiesman of the School o f Community and Regional P l a n n i n g a t the U n i v e r s i t y of B r i t i s h Columbia; the s t a f f and o f f i c i a l s from the M i n i s t r y o f M u n i c i p a l A f f a i r s of B r i t i s h Columbia, e s p e c i a l l y Mr. H.G. Topham, D i r e c t o r o f F i n a n c i a l S e r v i c e s ; and numerous o f f i c i a l s and r e p r e s e n t a t i v e s from v a r i o u s m u n i c i p a l governments throughout the p r o v i n c e . As with any study o f t h i s nature, the author i s p a r t i c u l a r l y g r a t e f u l to the t y p i s t , Mrs. Cindy V a r l e y , who spent many long hours t y p i n g the numerous "rough" and f i n a l d r a f t s . F i n a l l y , very s p e c i a l thanks go to Lynda, whose f a i t h and constant encouragement i m p e l l e d the author to complete t h i s t h e s i s . 1 CHAPTER ONE  STUDY FORMAT 1.1 I n t r o d u c t i o n : In the e a r l y h a l f o f the 1970's, the impost fee - v a r i o u s l y r e f e r r e d to as a development surcharge, an impact tax, a community s e r v i c e fee and a l a n d use charge -was a popular revenue g e n e r a t i n g mechanism w i t h i n the day to day o p e r a t i o n s of a number o f m u n i c i p a l i t i e s throughout B r i t i s h Columbia. From the a v a i l a b l e i n f o r m a t i o n , i t would appear t h a t t h i s concept was f i r s t i n t r o d u c e d i n t o the p r o v i n c e by the M u n i c i p a l i t y of Richmond i n the e a r l y 1960's and was l a t e r adopted by numerous oth e r l o c a l i t i e s throughout B r i t i s h Columbia. In the l a t t e r h a l f o f the 1970's, l e g i s l a t i v e amendments were i n t r o d u c e d which p u r p o r t e d l y a b o l i s h e d the impost fee and r e p l a c e d i t w i t h a s i m i l a r instrument c a l l e d the development c o s t charge. T h i s l a t t e r technique, l i k e i t s predecessor, has become very popular among many m u n i c i -p a l i t i e s , as i t r e p r e s e n t s another form of m u n i c i p a l t a x a -t i o n , broadening t h e i r l i m i t e d revenue sources. Since i t s i n t r o d u c t i o n i n the p r o v i n c e , the impost fee and the development c o s t charge have been c o n t e n t i o u s i s s u e s . The m a j o r i t y of the comments concerning these l e v i e s - by the media, deve l o p e r s , l a n d i n v e s t o r s and other members of the g e n e r a l p u b l i c - have been n e g a t i v e , w i t h the m u n i c i p a l i t i e s , and more r e c e n t l y the p r o v i n c i a l 2 government, being the o n l y proponents. Many of the c r i t i c i s m s r a i s e d a g a i n s t the impost fee and the development c o s t charge are due, i n p a r t , to the l a c k o f understanding o f the concepts and i s s u e s . T h i s i s somewhat understandable, s i n c e there has been l i t t l e p u b l i c documentation o r assembly of i n f o r m a t i o n r e l a t i n g to t h i s s u b j e c t matter. Thus, the reason f o r t h i s t h e s i s . 1.2 Study Purpose: T h i s study has been undertaken to pr o v i d e f a c t u a l i n f o r m a t i o n r e l a t i n g to impost fees and development c o s t charges i n B r i t i s h Columbia. In g e n e r a l , the aim of t h i s study i s to e s t a b l i s h a b e t t e r understanding o f the concepts. More s p e c i f i c a l l y , t h i s study has four o b j e c t i v e s : 1. to determine and d i s c u s s some of the major f a c t o r s and events which prompted the m u n i c i p a l i t i e s i n B r i t i s h Columbia to c o n s i d e r and adopt the l e v y i n g o f impost fee s ; 2. to c l a r i f y the philosophy and implementation s t r a t e g i e s of the impost fee concept and determine the ext e n t o f i t s use i n B r i t i s h Columbia p r i o r to the advent of the development c o s t charge l e g i s l a t i o n ; 3. to determine and d i s c u s s some of the major f a c t o r s and events which prompted the p r o v i n c i a l government to a b o l i s h impost fees and i n t r o d u c e development c o s t charges; and, 3 4. to examine and s y n t h e s i z e the development c o s t charge l e g i s l a t i o n to a s c e r t a i n i t s p h i l o s o p h y , purpose and the requirements p r o v i d e d t h e r e i n , as w e l l as to determine the extent o f i t s c u r r e n t use i n the p r o v i n c e . 1.3 Work Program: Information on the impost fee and development c o s t charge has been c o l l e c t e d i n three d i s t i n c t ways. F i r s t , an attempt was made to determine the e x t e n t of p r e v i o u s s t u d i e s which d e a l t w i t h the s u b j e c t s o f impost fees and development c o s t charges i n B r i t i s h Columbia. A f t e r an i n s p e c t i o n of the l i t e r a t u r e i n the U n i v e r s i t y o f B r i t i s h Columbia l i b r a r i e s , i t was apparent t h a t i n f o r -mation r e l a t i n g to t h i s s u b j e c t matter was very s c a r c e . Except f o r two summary b r i e f s - e n t i t l e d Land Use C o n t r a c t s (1976) and Land Use C o n t r o l i n B r i t i s h Columbia (1979) -p u b l i s h e d by the Centre f o r C o n t i n u i n g Education, the U n i v e r s i t y of B r i t i s h Columbia, i n f o r m a t i o n d e a l i n g s p e c i -f i c a l l y w i t h impost fees and development c o s t charges i n t h i s p r o v i n c e was n o n - e x i s t e n t . In order to o b t a i n f u r t h e r background i n f o r m a t i o n r e l a t i n g to t h i s s u b j e c t , s e v e r a l l o c a l government a u t h o r i -t i e s , which had adopted the impost fee and/or the develop-ment c o s t charge concepts, were approached. The author was able to l o c a t e s e v e r a l departmental s t u d i e s which d e a l t with the s u b j e c t . These s t u d i e s were prepared by the f o l l o w i n g l o c a l i t i e s : the M u n i c i p a l i t i e s o f Burnaby, D e l t a 4 and Surrey and the C i t i e s of Kamloops and White Rock. These r e p o r t s were q u i t e h e l p f u l s i n c e they presented the " g r a s s - r o o t s " a d m i n i s t r a t i v e p e r s p e c t i v e o f the concepts. Secondly, a q u e s t i o n n a i r e d e a l i n g s p e c i f i c a l l y w ith the impost fee was sent to the l a r g e r m u n i c i p a l i t i e s i n the p r o v i n c e - a t o t a l o f 36 l o c a l i t i e s were chosen -to determine the extent o f i t s use p r i o r to the development c o s t charge l e g i s l a t i o n . The q u e s t i o n n a i r e , a copy of which i s i n c l u d e d as Appendix 1, requested i n f o r m a t i o n on the l e v e l s o f imposts by type o f development and land use, and a l s o on the means of implementation. T h i s survey - conducted i n January and February of 1977 - p r o v i d e d a comprehensive p i c t u r e o f the impost fee i n B r i t i s h Columbia. F i n a l l y , s e v e r a l m u n i c i p a l o f f i c i a l s from v a r y i n g l o c a l i t i e s throughout B r i t i s h Columbia and r e p r e s e n t a t i v e s from the p r o v i n c i a l M i n i s t r y o f M u n i c i p a l A f f a i r s were i n t e r v i e w e d . * These persons were informed o f the study's o b j e c t i v e s and were asked to p r o v i d e comments and i n f o r m a t i o n on impost fees and development c o s t charges. The q u a l i t y and content of t h i s i n f o r m a t i o n v a r i e d w i d e l y . T h i s was due to the f a c t t h a t some o f f i c i a l s were more generous wi t h t h e i r time than o t h e r s . However, a l l i n a l l , the i n t e r v i e w s were q u i t e s u c c e s s f u l , e s p e c i a l l y the one with Mr. H.G. Topham, D i r e c t o r of F i n a n c i a l S e r v i c e s with the M i n i s t r y of M u n i c i p a l A f f a i r s , who s u p p l i e d the author w i t h a con-* There were e i g h t i n t e r v i e w s conducted i n January and February of 1977, and four i n t e r v i e w s conducted i n J u l y , 1974. 5 s i d e r a b l e amount of i n f o r m a t i o n r e l a t i n g to development c o s t charges. 1.4 Study O u t l i n e ; Chapter Two b r i e f l y summarizes the background i n f o r m a t i o n necessary to f u l l y understand the impost fee and development c o s t charge concepts. In p a r t i c u l a r , t h i s chapter reviews the framework and development of government i n Canada. T h i s chapter begins w i t h a g e n e r a l d e s c r i p t i o n of what o b j e c t i v e s government serves and then d e t a i l s the governmental s t r u c t u r e and the d i v i s i o n of power i n the Canadian context. The chapter then focuses on the m u n i c i p a l government o r g a n i z a t i o n , with p a r t i c u l a r r e f e r e n c e to B r i t i s h Columbia. Information p e r t a i n i n g to the m u n i c i p a l i -t i e s ' r e s p o n s i b i l i t i e s , f u n c t i o n s and powers i s presented. Chapter Three continues to focus on m u n i c i p a l governments i n B r i t i s h Columbia, with p a r t i c u l a r r e f e r e n c e to t h e i r f i n a n c i a l s i t u a t i o n . In a d d i t i o n to p r o v i d i n g i n f o r m a t i o n on the f i n a n c i a l i m p l i c a t i o n s of t h e i r respon-s i b i l i t i e s , f u n c t i o n s and powers, t h i s chapter i n v e s t i g a t e s and comments on the major causes o f f i s c a l problems a t the l o c a l government l e v e l . In so doing, t h i s chapter reviews the m u n i c i p a l i t y ' s expenditures and i t s source o f revenue. T h i s chapter c o n t a i n s the i n f o r m a t i o n to s a t i s f y the f i r s t o f the four o b j e c t i v e s of t h i s study. Chapter Four e x p l a i n s how the impost fee evolved as a d i r e c t response o f m u n i c i p a l governments to the causes 6 of f i s c a l problems d e t a i l e d i n Chapter Three. In a d d i t i o n , t h i s chapter d i s c u s s e s the philosophy and implementation s t r a t e g i e s r e l a t i n g to the impost fee as i t a p p l i e s to B r i t i s h Columbia d u r i n g i t s formative years from the e a r l y 1960's to 1977. R e s u l t s from the q u e s t i o n n a i r e conducted i n February and March of 1977 i s a l s o presented i n t h i s chapter to i n d i c a t e how many m u n i c i p a l i t i e s were l e v y i n g impost charges, the amount of these charges and how these charges were being l e v i e d . The i n f o r m a t i o n presented i n t h i s chapter serves to s a t i s f y the second o b j e c t i v e of t h i s study. Chapter F i v e i s the c h r o n o l o g i c a l c o n t i n u a t i o n of Chapter Four, as i t prov i d e s i n f o r m a t i o n on impost fees and the newly c r e a t e d development c o s t charges from 1977 to 1979. T h i s chapter begins w i t h an e x p l a n a t i o n o f the f a c t o r s and events which l e d to the demise of the impost fee, with p a r t i c u l a r r e f e r e n c e to the changes i n a t t i t u d e a t the p r o v i n c i a l government l e v e l which r e s u l t e d i n the new l e g i s l a t i o n . T h i s chapter then d i s c u s s e s the new l e g i s l a t i o n and concentrates predominently on the development c o s t charge p r o v i s i o n s . In a d d i t i o n to examining the requirements and r e g u l a t i o n s o f each c l a u s e o f the l e g i s l a t i o n and t h e i r i m p l i c a t i o n s , t h i s chapter p r o v i d e s some survey s t a t i s t i c s on the c u r r e n t use of the development c o s t charge. T h i s chapter s a t i s f i e s the t h i r d and f o u r t h o b j e c t i v e s of t h i s study. 7 The f i n a l chapter, Chapter S i x , p r o v i d e s a b r i e f summary of the i n f o r m a t i o n presented i n the body of t h i s study and the r e s p e c t i v e c o n c l u s i o n s based on same. Areas of f u r t h e r r e s e a r c h and the study's i m p l i c a t i o n f o r p l a n n i n g are a l s o i n c l u d e d i n t h i s chapter. 8 CHAPTER TWO  BACKGROUND INFORMATION 2.1 I n t r o d u c t i o n : In B r i t i s h Columbia, the impost f e e , or what i s now r e f e r r e d to as a development c o s t charge, has become an i n t e g r a l component i n the f i n a n c i a l s t r u c t u r e of many l o c a l governing a u t h o r i t i e s . M u n i c i p a l i t i e s and m u n i c i p a l d i s t r i c t s a l i k e have been u s i n g the impost fee and develop-ment c o s t charge as an a d d i t i o n a l source of revenue to f i n a n c e a v a r i e t y of m u n i c i p a l works and undertakings. For i n s t a n c e , i n some l o c a l i t i e s , these instruments have been used to a c q u i r e revenues to purchase and/or develop park lands; and c o n s t r u c t and/or improve p u b l i c i n f r a s t r u c -t u r e such as storm sewers, waterwork f a c i l i t i e s and roadways. As an i n t e g r a l component o f m u n i c i p a l f i n a n c e , the impost fee and development c o s t charge have become embedded i n the s t r u c t u r e of m u n i c i p a l government. T h e i r o r i g i n arid t h e i r use are a r e s u l t o f , and consequently i n t e r t w i n e d w i t h , the e v o l u t i o n a r y development o f l o c a l governments. T h i s chapter reviews the l i t e r a t u r e r e l e v a n t to the h i s t o r y of these concepts. In p a r t i c u l a r , i t d e a l s w i t h the development o f m u n i c i p a l governments from the advent of the B r i t i s h North America A c t to the p r e s e n t . There w i l l a l s o be i n c l u d e d some important background i n f o r m a t i o n r e l a t i n g to m u n i c i p a l r e s p o n s i b i l i t i e s and 9 f u n c t i o n s and m u n i c i p a l f i n a n c e . T h i s i n f o r m a t i o n i s necessary to f u l l y understand the impost fee and development c o s t charge concepts. 2.2 The Government S t r u c t u r e and the D i v i s i o n of Power: Government, being used as a broad term r e f e r r i n g to "the o r g a n i z a t i o n , machinery or agency through which a p o l i t i c a l u n i t e x e r c i s e s a u t h o r i t y and performs f u n c t i o n s " (Webster's T h i r d New I n t e r n a t i o n a l D i c t i o n a r y , 1976), o r i g i n a l l y developed i n response to meet a need - a need to accomplish some purpose which c o u l d be more adequately achieved by a c t i o n o f a group than by the a c t i o n of the i n d i v i d u a l (Crawford, 1954). As u r b a n i z i n g s o c i e t i e s became more complex, the number o f such needs i n c r e a s e d and consequently, the governmental s e c t o r expanded. Govern-ments, by n e c e s s i t y , became more and more s o p h i s t i c a t e d , through time, and although t h e i r o r i g i n a l purpose - to meet a need - s t i l l e x i s t s , they now assume d i f f e r e n t forms, r e s p o n s i b i l i t i e s and powers. While i t i s d i f f i c u l t to enumerate a l l the v a r i e d powers e x e r c i s e d by modern governments, i t i s s a i d there are three d i s t i n c t c a t e g o r i e s o f governmental powers: l e g i s l a t i v e , e x e c u t i v e and j u d i c i a l . The l e g i s l a t i v e power c o n s i s t s i n making laws and g e n e r a l r u l e s of conduct; the a d m i n i s t r a t i v e power c o n s i s t s i n the e x e c u t i n g of the laws and the c a r r y i n g on of the p u b l i c a c t i v i t i e s and s e r -v i c e s ; and, the j u d i c i a l power c o n s i s t s i n i n t e r p r e t i n g 10 the laws, or more c o n c r e t e l y , d e c i d i n g i n the event of d i s p u t e , what s p e c i f i c a c t s are p e r m i t t e d or r e q u i r e d or f o r b i d d e n i n execution of the law (Corry, 1959). In Canada, the government s t r u c t u r e i s comprised of three types of l e g i s l a t u r e s which, s u b j e c t to s p e c i a l c o n d i t i o n s , have the power to enact l e g i s l a t i o n . They are: f i r s t , the Parliament of the United Kingdom; second, the F e d e r a l Parliament; and t h i r d , the l e g i s l a t u r e s o f the ten pro v i n c e s ( C h a f f i n , 1969). The Parliament of the United Kingdom, being i n s t r u -mental i n the i n i t i a l development of government i n Canada, s t i l l has c e r t a i n l e g i s l a t i v e a u t h o r i t y i n t h i s country. I t s i n f l u e n c e remains i n the form of B r i t i s h s t a t u t e s of major c o n s t i t u t i o n a l importance ( i . e . , the B r i t i s h North America A ct and i t s amendments and the S t a t u t e of West-minster) and B r i t i s h o r d e r s - i n - c o u n c i l . However, as Dawson (1963) p o i n t s out, the a c t s of the B r i t i s h P a r l i a m e n t are now becoming very few indeed and, under the S t a t u t e of Westminster, Canada has the g e n e r a l power to enact l e g i s -l a t i o n which may run c o n t r a r y to the p r o v i s i o n s of an Imp e r i a l A c t . In a c o n s t i t u t i o n a l sense, the l e g i s l a t i v e importance of the B r i t i s h Parliament - although h o l d i n g i t s r i g h t f u l p l a c e i n Canada's h e r i t a g e - i s becoming l e s s important, with more and more emphasis being p l a c e d on the Canadian bodies of government. The Canadian body of government which has been endowed with s u b s t a n t i a l a u t h o r i t y i s the Dominion, or more 11 commonly r e f e r r e d to as the F e d e r a l P a r l i a m e n t . The l e g i s -l a t i v e powers of the F e d e r a l Parliament are, f o r the most p a r t , d e f i n e d i n S e c t i o n 91 of the B r i t i s h North America Act, 1867. T h i s s e c t i o n e x p r e s s l y formulates a two prong approach f o r g r a n t i n g powers. The f i r s t p a r t of the s e c t i o n i s a broad and comprehensive grant, g i v i n g p a r l i a m e n t the a u t h o r i t y to "make laws f o r the Peace, Order and Good Government of Canada" i n r e l a t i o n to those matters not given to the p r o v i n c e s . The second p a r t c o n s i s t s of a l i s t of s p e c i f i c powers which are g i v e n i n d e t a i l " f o r g r e a t e r c e r t a i n t y , but not so as to r e s t r i c t the g e n e r a l i t y " of the comprehensive gran t . T h i s l a t t e r s e c t i o n enumerates matters such as: "the P u b l i c Debt and P r o p e r t y " , "the R e g u l a t i o n of Trade and Commerce", "the R a i s i n g of Money by any Mode or System of T a x a t i o n " , e t c . As Dawson (1963) p o i n t s out, t h i s two prong approach i s not a double grant of powers, but r a t h e r , i s a means of emphasis and c l a r i f i c a t i o n . D e s p i t e the dichotomy, there i s but one g e n e r a l sweeping grant of power with c e r t a i n e x p l i c i t powers being mentioned by way of example. The l e g i s l a t i v e power of the p r o v i n c e s are, f o r the most p a r t , s e t out i n S e c t i o n 92 of the A c t . U n l i k e S e c t i o n 91, S e c t i o n 92 does not begin w i t h any comprehensive grant of power to the p r o v i n c e s , but simply s t a t e s t h a t , "In each P r o v i n c e , the L e g i s l a t u r e may e x c l u s i v e l y make laws i n r e l a t i o n to Matters coming w i t h i n the C l a s s e s of S u b j e c t s next h e r e i n - a f t e r enumerated" and then proceeds to l i s t 16 matters, such as " D i r e c t T a x a t i o n w i t h i n the P r o v i n c e 12 i n o r d e r to the R a i s i n g o f a Revenue f o r P r o v i n c i a l Pur-poses", "Municipal I n s t i t u t i o n s i n the P r o v i n c e " , "Property and C i v i l Rights i n the P r o v i n c e " , and "G e n e r a l l y a l l Matters of a merely l o c a l or p r i v a t e Nature i n the P r o v i n c e " . Thus, when S e c t i o n s 91 and 92 are read together, i t i s c l e a r t h a t the i n t e n t i o n i s to g i v e the f e d e r a l government com-prehensive power to make law and then to except from t h i s g e n e r a l grant c e r t a i n c a r e f u l l y s p e c i f i e d powers which are bestowed upon the p r o v i n c i a l l e g i s l a t u r e s . Under S e c t i o n 92, Subs e c t i o n 8, of the B r i t i s h North America Act, the p r o v i n c e s have found i t convenient to c r e a t e v a r i o u s types o f l o c a l governments to e x e r c i s e some of t h e i r a u t h o r i t y i n s p e c i f i c l o c a t i o n s (Lorimer, 1972). However, s i n c e the p r o v i n c e s r e t a i n t h e i r supremacy over the l e g i s l a t i v e powers as granted i n t h i s s e c t i o n , the powers bestowed upon l o c a l governments are e n t i r e l y a t the d i s -c r e t i o n o f the p r o v i n c i a l l e g i s l a t u r e . In B r i t i s h Columbia, the p r o v i n c i a l government has c r e a t e d s e v e r a l types of l o c a l governments, i n c l u d i n g m u n i c i p a l i t i e s , improvement d i s t r i c t s , s c h o o l d i s t r i c t s , h o s p i t a l d i s t r i c t s and, more r e c e n t l y , r e g i o n a l d i s t r i c t s . In a c o n s t i t u t i o n a l sense, a l l o f the aforementioned governing bodies are p r o v i n c i a l agencies, e x e r c i s i n g s p e c i f i c powers w i t h i n a narrowly d e f i n e d area o f respon-s i b i l i t y . The b a s i c f e a t u r e d i s t i n g u i s h i n g each type from one another i s the range of f u n c t i o n s and powers e x p r e s s l y granted by the p r o v i n c i a l l e g i s l a t u r e . 13 2.3 M u n i c i p a l Governments i n B r i t i s h Columbia: Although the p r o v i n c i a l government now has e x c l u -s i v e c o n t r o l over m u n i c i p a l governments, the h i s t o r y o f c i v i c i n s t i t u t i o n s dates back beyond the B r i t i s h North America A c t . I n i t i a l l y , m u n i c i p a l government was developed as a d e v i c e which enabled persons or groups to j o i n t o gether f o r the purposes o f l o c a l government and to o b t a i n the r e s u l t s d e s i r e d through one medium, r a t h e r than by the sum t o t a l of t h e i r i n d i v i d u a l e f f o r t s and r e s p o n s i b i l i t i e s (Crawford, 1954). However, more r e c e n t l y , m u n i c i p a l govern-ment has become more s p e c i a l i z e d and although i t s t i l l per-forms a v a r i e t y of f u n c t i o n s , i t has been r e f e r r e d to as "the r e g u l a t o r y and s e r v i c e agency of the p r o v i n c e f o r the p r o p e r t y i n d u s t r y " (Lorimer, 1972) . C l e a r l y , the p r o p e r t y i n d u s t r y needs both b a s i c s e r v i c e s and r e g u l a t i o n i n o r d e r to f u n c t i o n as i t does now. M u n i c i p a l governments are the way i n which the p r o v i n c e s have arranged f o r these s e r v i c e s and r e g u l a t i o n s to be p r o v i d e d (Lorimer, 1972). In o r d e r to p r o v i d e these s e r v i c e s and r e g u l a t i o n s , the p r o v i n c e has bestowed upon the m u n i c i p a l i t y - i n c e r t a i n i n s t a n c e s and under c e r t a i n c o n d i t i o n s - the a u t h o r i t y to c a r r y out each of the three governmental f u n c t i o n s , as p r e -v i o u s l y mentioned. The power to c a r r y them out, however, i s not boundless. A l l powers possessed by l o c a l a u t h o r i t i e s - whether of a l e g i s l a t i v e , a d m i n i s t r a t i v e or j u d i c i a l nature - are d e r i v e d e i t h e r d i r e c t l y or i n d i r e c t l y by express grant or necessary i m p l i c a t i o n from the p r o v i n c i a l l e g i s l a t u r e . In other words, m u n i c i p a l i t i e s are c r e a t e d to e x e r c i s e o n l y those powers which the l e g i s l a t u r e i n i t s wisdom has committed to them (Rogers, 1959). From a B r i t i s h Columbian h i s t o r i c a l p o i n t o f view, the f i r s t m u n i c i p a l i t i e s , such as New Westminster (1860) and V i c t o r i a (1862) were i n c o r p o r a t e d and bestowed c e r t a i n powers under the p r o v i s i o n s o f "An Ordinance f o r the Formation and R e g u l a t i o n o f M u n i c i p a l i t i e s i n B r i t i s h Columbia" a p p l i c a b l e to the colony. T h i s ordinance was subsequently r e p l a c e d i n 1872 by an Act of the new pro-v i n c i a l l e g i s l a t u r e r e s p e c t i n g m u n i c i p a l i t i e s . Some nine a d d i t i o n a l m u n i c i p a l i t i e s were i n c o r p o r a t e d p r i o r to the p a s s i n g of The M u n i c i p a l Clauses A c t of 1892. T h i s l a t t e r Act, which pr o v i d e d f o r an adaption o f the O n t a r i o m u n i c i p a l system to B r i t i s h Columbia, was the for e r u n n e r of the e x i s t i n g m u n i c i p a l l e g i s l a t i o n . Today, i n B r i t i s h Columbia, the M u n i c i p a l A c t (R.S.B.C. 1960, Chapter 255 and Amendments) i s the one gene r a l a c t p e r t a i n i n g to a l l m u n i c i p a l i t i e s i n the p r o v i n c e - except f o r the C i t y o f Vancouver, which i s governed by the Vancouver C h a r t e r , S.B.C. 1953, C.55. The c u r r e n t Act p r o v i d e s f o r the c r e a t i o n o f s e v e r a l types o f munici-p a l i t i e s , from the s m a l l e s t to the l a r g e s t , and a l s o enu-merates both the extent and nature o f the powers which have been bestowed by the p r o v i n c i a l l e g i s l a t u r e . By means of the M u n i c i p a l A c t , the l e g i s l a t u r e has granted m u n i c i p a l i t i e s i n t h i s p r o v i n c e , the f u l l range 15 of subordinate government powers, t h a t i s , to l e g i s l a t e , to administer the l e g i s l a t i o n , and to a d j u d i c a t e i n the event of d i s p u t e . T h i s endowment g i v e s m u n i c i p a l i t i e s e x t e n s i v e c o n t r o l over matters of l o c a l concern. Some examples and p o s s i b l e a p p l i c a t i o n of these powers f o l l o w . Using the l e g i s l a t i v e powers c o n f e r r e d by the M u n i c i p a l A c t , a m u n i c i p a l i t y i s empowered to pass c e r t a i n by-laws which can r e g u l a t e the a c t i v i t i e s and the conduct of persons w i t h i n t h e i r j u r i s d i c t i o n a l boundaries. For i n s t a n c e , a m u n i c i p a l c o u n c i l - which i s an e l e c t e d body, s i m i l a r to the board of d i r e c t o r s of a c o r p o r a t i o n , t h a t r e p r e s e n t s the m u n i c i p a l i t y - i s a u t h o r i z e d to r e g u l a t e the use o f l a n d by adopting zoning ( S e c t i o n 702) and b u i l d i n g ( S e c t i o n 714) by-laws, and may a l s o r e g u l a t e the s u b d i v i s i o n of l a n d ( S e c t i o n 711) and p r e s c r i b e a p p r o p r i a t e minimum standards. Furthermore, under c e r t a i n c o n d i t i o n s , a c o u n c i l may by by-law a u t h o r i z e i t s agents to enter upon, exprop-r i a t e , or take i n t o p o s s e s s i o n and use any r e a l p r o p e r t y f o r c e r t a i n m u n i c i p a l undertakings ( S e c t i o n 534). Under i t s a d m i n i s t r a t i v e powers, a m u n i c i p a l i t y can execute those l o c a l a f f a i r s over which i t has enacted l e g i s l a t i o n . For i n s t a n c e , because i t has been g i v e n the power to r e g u l a t e the use of lands and the persons u s i n g those lands, the m u n i c i p a l i t y may a l s o p r o v i d e a v a r i e t y of s e r v i c e s and u t i l i t i e s ( S ections 531, 559 . . . ) i n response to the needs of the i n h a b i t a n t s . Furthermore, the m u n i c i p a l i t y , u s i n g i t s a d m i n i s t r a t i v e powers, may 16 a l s o f i n a n c e these s e r v i c e s through v a r i o u s means. They are a u t h o r i z e d by the M u n i c i p a l A c t to r a i s e funds by t a x i n g r e a l p r o p e r t y ( S e c t i o n 368); i s s u i n g business l i c e n c e s ( S e c t i o n 440); charg i n g fees f o r u t i l i t i e s , i n c l u d i n g s e r v i c e f e e s , connection charges, fro n t a g e taxes, e t c . ( S e c t i o n 532); and i s a l s o able to borrow money and i n c u r l i a b i l i t i e s ( S e c t i o n 247). The t h i r d and f i n a l category of governmental powers bestowed upon the m u n i c i p a l i t y i s the j u d i c i a l func-t i o n . In t h i s sense, the term " j u d i c i a l " should not be confused w i t h the j u d i c i a r y of a f e d e r a l or p r o v i n c i a l c o u r t which are h i g h l y s o p h i s t i c a t e d mechanisms of the s t a t e . Nor should t h i s term be i n t e r p r e t e d w i t h i n the s t r i c t framework of a d i c t i o n a r y d e f i n i t i o n , but r a t h e r , as Rogers p o i n t s out "a m u n i c i p a l c o u n c i l , although a non-j u d i c i a l body, may sometimes be c l o t h e d w i t h q u a s i - j u d i c i a l f u n c t i o n s " (1959). As an example, the c o u n c i l i s r e q u i r e d to a d j u d i c a t e a t p u b l i c hearings p r i o r to the implementation of a zoning by-law so t h a t " a l l persons who deem t h e i r i n t e r e s t i n p r o p e r t y a f f e c t e d by the proposed by-law s h a l l be a f f o r d e d an o p p o r t u n i t y to be heard" ( M u n i c i p a l A c t , S e c t i o n 703). Besides having those above noted powers which have been e x p r e s s l y c o n f e r r e d by s t a t u t e ( i . e . , the M u n i c i p a l A c t ) , m u n i c i p a l governments possess numerous ot h e r powers which are i n c i d e n t a l t o , but necessary f o r , i t s very e x i s t e n c e . For i n s t a n c e , the modern m u n i c i p a l c o r p o r a t i o n , being a l e g a l e n t i t y as the term " c o r p o r a t i o n " would imply, i s a l s o vested w i t h c e r t a i n powers, immunities and l i a b i l i -t i e s as p r e s c r i b e d by law and has most of the r i g h t s which a n a t u r a l person possesses. Some of the more e s s e n t i a l i n c i d e n t s and a t t r i b u t e s o f m u n i c i p a l c o r p o r a t e c a p a c i t y and e x i s t e n c e are as f o l l o w s : 1 . a c o r p o r a t e name as the p r i n c i p a l means by which i d e n t i t y , n o t w i t h s t a n d i n g c o n s t a n t l y changing member-sh i p can be manifested; 2. a common s e a l by which the assent of the c o r p o r a t e body can be manifested, n o t w i t h s t a n d i n g i n t e r n a l d i f f e r e n c e s of o p i n i o n ; 3. membership as d e f i n e d by those r e s i d e n t w i t h i n the c o r p o r a t e l i m i t s ; 4 . t e r r i t o r y , the d e f i n e d l i m i t s of which a l s o c o n f i n e j u r i s d i c t i o n ; 5. p e r p e t u a l s u c c e s s i o n , n o t w i t h s t a n d i n g death of i t s members; 6. power to a c q u i r e and h o l d p r o p e r t y f o r a u t h o r i z e d pur-poses and to a l i e n a t e same i n i t s c o r p o r a t e name; 7 . power to sue and be sued i n i t s c o r p o r a t e name; 8. power to c o n t r a c t i n i t s c o r p o r a t e name; 9 . power of m a j o r i t y to b i n d o t h e r s ; 1 0 . exemption of agents from l i a b i l i t y when a c t i n g i n conformity with the fundamental law of the c o r p o r a t i o n 1 1 . a governing body which e x e r c i s e s the powers of the c o r p o r a t i o n ; 18 12. r i g h t to e x e r c i s e through i t s c o u n c i l c e r t a i n a u t h o r i t y over the p o p u l a t i o n o f a d e f i n e d a r e a . The mixture o f l e g i s l a t i v e , a d m i n i s t r a t i v e and j u d i c i a l f u n c t i o n s and powers, as w e l l as those powers which are i n c i d e n t a l to i t s c o r p o r a t e c a p a c i t y and e x i s -tence, bestows upon a m u n i c i p a l i t y , e x t e n s i v e c o n t r o l over matters o f l o c a l concern. These a t t r i b u t e s , i n f a c t , d i s -t i n g u i s h the m u n i c i p a l i t y from the other types of l o c a l governments ( i . e . , improvement d i s t r i c t s , s c h o o l d i s t r i c t s , h o s p i t a l d i s t r i c t s ) and although m u n i c i p a l i t i e s have not been c o n f e r r e d complete l o c a l autonomy, they possess the most comprehensive s e t of powers necessary f o r l o c a l s e l f -government . 2.4 Functions and R e s p o n s i b i l i t i e s of M u n i c i p a l Governments: A Canadian m u n i c i p a l c o r p o r a t i o n has been d e f i n e d as "a body c o r p o r a t e . . . upon which the L e g i s l a t u r e has e i t h e r d i r e c t l y or through some i n t e r m e d i a t e agency, con-f e r r e d . . . the r i g h t to ad m i n i s t e r . . . such matters of l o c a l concern as are e i t h e r s p e c i f i e d or as are n e c e s s a r i l y i m p l i e d from the nature and extent o f the a u t h o r i t y con-f e r r e d " (Rogers, 1959). The f o r e g o i n g d e f i n i t i o n i m p l i e s t h a t m u n i c i p a l government, as i t e x i s t s i n Canada, i s of a dual o r composite c h a r a c t e r . On the one hand, a m u n i c i p a l government i s given c e r t a i n powers to be used f o r the b e n e f i t of the community a t l a r g e as a convenient method of exer-c i s i n g some of the f u n c t i o n s o f government. On the other 19 hand, i t i s a l s o e n t r u s t e d w i t h c e r t a i n powers of government f o r the b e n e f i t of the i n h a b i t a n t s i n t h e i r l o c a l or c o r -porate l i m i t s as d i s t i n c t from the i n t e r e s t o f the p u b l i c a t l a r g e (Rogers, 1959) . In the former case, the major f u n c t i o n of a muni-c i p a l c o r p o r a t i o n i s to perform d u t i e s which the L e g i s l a t u r e imposes upon them. Thus, i n t h i s regard, the m u n i c i p a l i t y can be s a i d to be a c t i n g as an agent o f the province.-C o u n c i l s have no ch o i c e but to c a r r y out these mandatory d u t i e s , although, un l e s s expressed to the c o n t r a r y , they may determine the manner i n which they do so. Some examples of these mandatory d u t i e s a re: 1. make p r o v i s i o n f o r i t s poor and d e s t i t u t e by g r a n t i n g or by c o n t r i b u t i n g to s o c i a l a s s i s t a n c e (Municipal Act, S e c t i o n 639); and, 2. p r o v i d e the amount of taxes r e q u i s i t i o n e d by the Board of School Tr u s t e e s f o r the purpose o f educa t i o n (Munici-p a l Act, S e c t i o n 367B). When the m u n i c i p a l i t y i s performing the d u t i e s of r e g u l a t i n g the conduct and s u p p l y i n g the wants of the p o p u l a t i o n i n a ge o g r a p h i c a l area by l o c a l laws, i t i s a c t i n g i n i t s m u n i c i p a l aspect (Rogers, 1971). The f u n c t i o n s c a r r i e d out i n t h i s c a p a c i t y are the o r d i n a r y housekeeping requirements which m u n i c i p a l i t i e s have assumed, such as the p r o v i s i o n o f water and sewer s e r v i c e s , f i r e p r o t e c t i o n , garbage c o l l e c t i o n and so on. T h i s second group o f f u n c t i o n s , u n l i k e the f i r s t , are d i s c r e t i o n a r y 20 i n t h a t the C o u n c i l i s not under any l e g a l o b l i g a t i o n to p r o v i d e t h e s e ' s e r v i c e s . However, s i n c e many o f the s e r v i c e s have been s u p p l i e d and have been i n o p e r a t i o n f o r such a long time, the p u b l i c , and i n some cases, the p o l i t i c i a n s , have assumed t h a t the p r o v i s i o n of these s e r v i c e s are a mu n i c i p a l r e s p o n s i b i l i t y . 2.5 Summary and C o n c l u s i o n s : The evolutionary, process of government o r g a n i z a t i o n i n Canada f o r m a l l y began i n 1867 wi t h the enactment of the B r i t i s h North America A c t . T h i s A c t o u t l i n e s the v i t a l components of the c e n t r a l government and enunciates the d i v i s i o n of powers. From a c o n s t i t u t i o n a l p o i n t of view, two of the more important p a r t s o f the Act are S e c t i o n s 91 and 92, which are concerned w i t h the d i s t r i b u t i o n of l e g i s -l a t i v e power between the f e d e r a l p a r l i a m e n t and the pro-v i n c i a l l e g i s l a t u r e . S e c t i o n 92, among other t h i n g s , has bestowed upon the p r o v i n c i a l l e g i s l a t u r e , f u l l j u r i s d i c t i o n over matters of a l o c a l concern. Using t h e i r l e g i s l a t i v e powers i n t h i s regard, the p r o v i n c i a l l e g i s l a t u r e i n B r i t i s h Columbia found i t convenient to c r e a t e a v a r i e t y of l o c a l governments. The most common type of l o c a l government t h a t was c r e a t e d was the m u n i c i p a l i t y , s i n c e i t has been c o n f e r r e d , s u b j e c t to r e g u l a t i o n s , the f u l l range of subordinate governmental powers - l e g i s l a t i v e , a d m i n i s t r a t i v e and j u d i c i a l . The i n t e g r a t i o n o f these powers has gi v e n a m u n i c i p a l i t y exten-21 s i v e c o n t r o l over matters of l o c a l concern. A m u n i c i p a l government e x h i b i t s a dual o r com-p o s i t e c h a r a c t e r and as such, has two b a s i c f u n c t i o n s . I t s f i r s t f u n c t i o n i s to a c t as an agent f o r the p r o v i n c i a l l e g i s l a t u r e . In t h i s c a p a c i t y , the m u n i c i p a l i t y performs those o b l i g a t o r y d u t i e s - such as p r o v i d i n g funds f o r s o c i a l w e l f a r e and educa t i o n - which the l e g i s l a t u r e imposes upon i t . T h e i r other f u n c t i o n i s to a c t on b e h a l f o f the people who dwell w i t h i n t h e i r j u r i s d i c t i o n a l boundaries. The muni-c i p a l i t y ' s d u t i e s i n t h i s c a p a c i t y are b a s i c a l l y o f a house-keeping nature and u s u a l l y i n c l u d e s a c t i v i t i e s such as the p r o v i s i o n o f water and s a n i t a r y s e r v i c e s . Although these d u t i e s are d i s c r e t i o n a r y , i n many cases the p u b l i c has tended to deem them m u n i c i p a l r e s p o n s i b i l i t i e s because of t h e i r fundamental c h a r a c t e r . 22 CHAPTER THREE  FINANCIAL IMPLICATIONS OF MUNICIPAL GOVERNMENT 3.1 I n t r o d u c t i o n : F i n a n c i a l problems are b a s i c problems of m u n i c i p a l government, f o r the a c t i v i t i e s and s e r v i c e s which a m u n i c i -p a l i t y i s able to c a r r y on depend u l t i m a t e l y on the money a v a i l a b l e to pay f o r them. As there i s almost no l i m i t to the p o s s i b l e demand f o r more and b e t t e r m u n i c i p a l s e r v i c e s and s i n c e the n a t u r a l a t t i t u d e o f the e l e c t e d r e p r e s e n t a t i v e s i s to gi v e the people the s e r v i c e s they want, the r e s u l t i s a r a p i d l y i n c r e a s i n g demand on l o c a l f i n a n c i a l r e s o u r c e s . The r e a l f i n a n c i a l problem f a c i n g the m u n i c i p a l i t y i s to s e l e c t from among the many requests e i t h e r those which are r e l a t i v e l y more e s s e n t i a l or more m e r i t o r i o u s with r e s p e c t to the a l l o c a t i o n o f funds. Chapter Three d i s c u s s e s t h i s problem. In p a r t i c u -l a r , t h i s chapter i n v e s t i g a t e s and comments on the major causes of f i n a n c i a l s t r a i n s i n l o c a l government. T h i s chapter reviews both s i d e s of the m u n i c i p a l f i n a n c e p i c t u r e - t h a t being the expenditures on the one hand, and on the othe r hand the sources of revenue - and reviews t h e i r i m p l i -c a t i o n s . 3.2 M u n i c i p a l E x p e n d i t u r e s : I t has been s a i d t h a t , i n one r e s p e c t m u n i c i p a l f i n a n c i n g - l i k e o t h e r l e v e l s o f government - i s the r e v e r s e 23 of p r i v a t e f i n a n c i n g , s i n c e the normal m u n i c i p a l procedure i s to determine f i r s t what i s to be the expenditure program f o r the year and then to a d j u s t the income a c c o r d i n g l y ; whereas i n p r i v a t e f i n a n c i n g , the i n d i v i d u a l attempts to a d j u s t h i s expenditure program to a predetermined income (Crawford, 1954). One of the f i r s t a c t s of a c o u n c i l coming i n a t the beginning o f a year i s to prepare i t s estimate of funds to be spent f o r l e g i t i m a t e m u n i c i p a l purposes. T h i s w i l l i n c l u d e a t l e a s t four c l a s s e s of e x p e n d i t u r e s : (1) debt charges, p r o v i s i o n f o r which are o b l i g a t o r y ; (2) funds to f i n a n c e other governing bodies whose requirements may be of two types - those f o r which c o u n c i l , as the tax l e v y i n g body, i s r e q u i r e d to r a i s e the amount demanded by the other bodies, and those w i t h r e s p e c t to which the c o u n c i l has d i s c r e t i o n as to the amount to be provided; (3) expenditures to p r o v i d e f o r s e r v i c e s which, under the law, the c o u n c i l must pay f o r ; and, (4) expendi-t u r e s f o r s e r v i c e s which are d i s c r e t i o n a r y . The former type of expenditure, debt charges, i n the s i m p l e s t terms, i s the repayment of i n t e r e s t and p r i n -c i p a l f o r a type of l o a n . When a c o u n c i l i n c u r s a debt repayable over a p e r i o d of y e a r s , succeeding c o u n c i l s are r e q u i r e d to l e v y taxes i n each subsequent year d u r i n g the l i f e t i m e of the s e c u r i t i e s i s s u e d , i n order to p r o v i d e f o r payment o f the i n t e r e s t f a l l i n g due each year and f o r the repayment of a predetermined p o r t i o n o f the p r i n c i p a l sum borrowed. The f i n a n c i a l i m p l i c a t i o n of t h i s expenditure depends upon the borrowing p o l i c i e s of p r e v i o u s c o u n c i l s 24 and the extent of debt, which they have b u i l t up. In some m u n i c i p a l i t i e s , a c o n s i d e r a b l e p o r t i o n o f these charges do not a c t u a l l y become a p a r t of the tax burden, as i t may be o f f s e t by revenues d e r i v e d from s e r v i c e fees - such as f o r water and sewer s e r v i c e s - to pay the charges on the debt i n c u r r e d f o r t h e i r c o n s t r u c t i o n . In these cases, the above noted s e r v i c e s would be c o n s t r u c t e d on a s e l f - l i q u i d a t i o n b a s i s . In the second type of expenditure - monies to be p a i d over to l o c a l boards and commissions - the m u n i c i p a l i t y a c t s as a tax c o l l e c t i o n agency f o r ot h e r a s s o c i a t e d b o d i e s . The u s u a l p r a c t i c e i s t h a t the taxes r e q u i r e d to f i n a n c e c e r t a i n boards are l e v i e d and c o l l e c t e d by the c o u n c i l , as i t i s u n d e s i r a b l e to d u p l i c a t e the a s s e s s i n g and tax c o l -l e c t i o n f u n c t i o n s . In t h i s case, the a p p l i c a b l e body which r e q u i r e s funds a d v i s e s the c o u n c i l , p r i o r to the time f o r f i x i n g the tax l e v y each year, of the amount of money i t * r e q u i r e s or d e s i r e s f o r the year. In B r i t i s h Columbia, these requirements or requests are of s e v e r a l types. Some bodies, such as the School Board, have the r i g h t to r e q u i s i t i o n a n n u a l l y from the c o u n c i l whatever amount they r e q u i r e f o r c u r r e n t expenditures f o r the year ( s u b j e c t to S e c t i o n 197 of the P u b l i c School Act) and the c o u n c i l must p r o v i d e the sum demanded. T h i s i s a s t a t u t o r y requirement as d i c t a t e d i n S e c t i o n 367B of the M u n i c i p a l A c t . In ot h e r cases, such as wi t h a L i b r a r y Board, the Board i s e n t i t l e d to demand from c o u n c i l , f o r 25 c u r r e n t e xpenditures, an amount up to a l i m i t f i x e d by the P u b l i c L i b r a r i e s A c t . The L i b r a r y Board may request l a r g e r amounts, but the p r o v i s i o n of any amount i n excess of t h a t f i x e d by the A c t l i e s w i t h i n the d i s c r e t i o n of the c o u n c i l . A t h i r d type i n c l u d e s those boards and commissions, such as with a Parks Board, which submit t h e i r requirements to coun-c i l but which the c o u n c i l has complete d i s c r e t i o n e i t h e r to g r ant the requests or to reduce or amend the amounts requested. The t h i r d type of expenditure encompasses those disbursements f o r s e r v i c e s which c o u n c i l s are r e q u i r e d by s t a t u t e to pay. Such s e r v i c e s i n c l u d e a p o r t i o n of the expenses of the r e g i o n a l h o s p i t a l d i s t r i c t ( S e c t i o n 206(c), M u n i c i p a l A c t ) , and the r e g i o n a l d i s t r i c t ( S e c t i o n 206(c), M u n i c i p a l Act) i n which the Regional H o s p i t a l Board and the Regional D i s t r i c t Board submit a b i l l to the r e s p o n s i b l e m u n i c i p a l i t y f o r i t s p r o - r a t e d share. In a d d i t i o n , there are other s e r v i c e s which a m u n i c i p a l i t y i s r e q u i r e d to pay, but over which i t has l i t t l e o r no c o n t r o l , such as pro-v i d i n g f o r the a d m i n i s t r a t i o n o f j u s t i c e . A c c o r d i n g to S e c t i o n 644 of the M u n i c i p a l Act, i t i s the duty of each m u n i c i p a l i t y to bear the expense necessary t o : (1) g e n e r a l l y maintain law and order i n the m u n i c i p a l i t y ; (2) p r o v i d e an \ o f f i c e f o r the p o l i c e f o r c e ; and, (3) p r o v i d e or make arrangement f o r the care and custody of persons h e l d i n p l a c e s of d e t e n t i o n . The f o u r t h and f i n a l type of expenditure - o u t l a y s 26 f o r d i s c r e t i o n a r y s e r v i c e s - r e l a t e s to those housekeeping s e r v i c e s , as d i s c u s s e d i n S e c t i o n 2.4 of the p receeding chapter, which a m u n i c i p a l i t y i s a u t h o r i z e d to perform, but which are not mandatory. These i n c l u d e such s e r v i c e s as garbage c o l l e c t i o n , f i r e p r o t e c t i o n and s t r e e t l i g h t i n g . While i n theory, the c o u n c i l has f u l l a u t h o r i t y to decide whether or not such s e r v i c e s are to be p r o v i d e d , i n r e a l i t y , once a s e r v i c e has been e s t a b l i s h e d , a c o u n c i l ' s d i s c r e t i o n i s l a r g e l y l i m i t e d to d e c i d i n g whether or not these s e r v i c e s are to be improved or extended. U s u a l l y , the p u b l i c w i l l not permit t h e i r e l i m i n a t i o n or r e d u c t i o n . A c o u n c i l has the a u t h o r i t y to reduce or e l i m i n a t e garbage c o l l e c t i o n , c l o s e the f i r e h a l l s and request the power be c u t o f f from i t s s t r e e t l i g h t s , but to do so, i t i s o b v i o u s l y not p o l i t i c a l l y p a l a t a b l e . In most i n s t a n c e s , the c i t i z e n s of the community w i l l not t o l e r a t e a r e d u c t i o n i n s e r v i c e s to which they have become accustomed. 3.3 M u n i c i p a l Revenues: Once the annual expenditure program has been decided upon, the c o u n c i l i s then faced w i t h the problem of p r o v i d i n g the revenues to achieve i t s commitments. T h i s i n v o l v e s the major problem of m u n i c i p a l f i n a n c e - to o b t a i n s u f f i c i e n t revenues to m a i ntain the standard of s e r v i c e s the community expects or which the m u n i c i p a l i t y i s r e q u i r e d to supply. The m u n i c i p a l i t y ' s o b j e c t i v e i n t h i s r e gard i s to f i n d revenues which have both the s t a b i l i t y to m a i n t a i n 27 e s s e n t i a l s e r v i c e s under adverse economic c o n d i t i o n s and the f l e x i b i l i t y to make p o s s i b l e the adjustment of revenues to changing demands. The M u n i c i p a l A c t of B r i t i s h Columbia - although i t does not s p e c i f i c a l l y d i f f e r e n t i a t e - a u t h o r i z e s m u n i c i -p a l i t i e s to a c q u i r e revenues i n two ways: (1) the d i r e c t method which allows m u n i c i p a l i t i e s to assess c e r t a i n types of l e v i e s and s e r v i c e f e e s ; and, (2) the i n d i r e c t method which allows m u n i c i p a l i t i e s to request f i n a n c i a l c o n t r i b u -t i o n s or s p e c i f i c performance - s u b j e c t to numerous r e s t r i c -t i o n s which are s t a t e d w i t h i n the A c t - as a c o n d i t i o n f o r some form of m u n i c i p a l c o n s i d e r a t i o n , which i s a l s o s t a t e d w i t h i n the A c t . In a d d i t i o n , m u n i c i p a l i t i e s may a l s o a c q u i r e revenue i n the form of s u b s i d i e s and grants from the pro-v i n c i a l government. The d i r e c t method o f revenue g e n e r a t i o n i n v o l v e s the use, by the m u n i c i p a l i t y , of those c l a u s e s i n the Muni-c i p a l A c t which allows them to l e v y c e r t a i n charges. For i n s t a n c e , the M u n i c i p a l A c t a u t h o r i z e s the m u n i c i p a l i t y to assess: (1) p r o p e r t y taxes ( S e c t i o n 367); (2) business taxes ( S e c t i o n 427); (3) l i c e n c e s ( S e c t i o n 440); (4) f i n e s ( S e c t i o n 220); (5) s p e c i a l assessments such as f r o n t a g e taxes ( S e c t i o n 415) and l o c a l improvement l e v i e s ( S e c t i o n 581); (6) user fees ( S e c t i o n 564); (7) c o n n e c t i o n charges ( S e c t i o n 532); and, most r e c e n t l y (8) development c o s t charges ( S e c t i o n 702C). T h i s l a t t e r method w i l l be d i s c u s s e d i n g r e a t e r d e t a i l i n a subsequent chapter. 28 The second source of revenue, the i n d i r e c t method, i n v o l v e s t r a n s f e r r i n g the r e s p o n s i b i l i t i e s f o r p r o v i d i n g or paying f o r m u n i c i p a l s e r v i c e s i n hew developments to the developer. The B r i t i s h Columbia M u n i c i p a l Act a u t h o r i z e s the m u n i c i p a l i t y to a c q u i r e the a p p r o p r i a t e monies or s p e c i f i c performance i n s e v e r a l ways: 1. A c o u n c i l may by by-law r e g u l a t e the s u b d i v i s i o n of l a n d by r e q u i r i n g the p r o v i s i o n of c e r t a i n s e r v i c e s , such as storm drainage, road s u r f a c i n g , sidewalks, boulevards, s t r e e t l i g h t i n g , underground w i r i n g , sewage c o l l e c t i o n systems and community water supply systems ( S e c t i o n 711). 2. A c o u n c i l may by by-law p r o v i d e f o r the s h a r i n g o f the c o s t , or any p o r t i o n t h e r e o f , o f any trunk water main or trunk s a n i t a r y sewer, or both, between the m u n i c i p a l i t y and the owner of the l a n d proposed to be s u b d i v i d e d ( S e c t i o n 711, S u b s e c t i o n 6). 3. A c o u n c i l , u s i n g i t s a d m i n i s t r a t i v e powers (as d i s c u s s e d i n the preceeding c h a p t e r ) , may enter i n t o a develop-ment c o n t r a c t or a s e r v i c i n g agreement with a w i l l i n g developer, who, by the terms of the c o n t r a c t or agree-ment assents to p r o v i d e or f i n a n c e the necessary s e r v i c e s ( t h i s type of agreement w i l l be d i s c u s s e d i n g r e a t e r d e t a i l i n a subsequent c h a p t e r ) . The t h i r d and f i n a l source o f m u n i c i p a l revenue i s i n the form of f i n a n c i a l a s s i s t a n c e from the p r o v i n c i a l government. T h i s a s s i s t a n c e i s a v a i l a b l e i n two ways. On 29 the one hand, there are p r o v i n c i a l s u b s i d i e s which are u s u a l l y o u t r i g h t c o n t r i b u t i o n s from the p r o v i n c i a l t r e a s u r y . These now c o n s t i t u t e the l a r g e s t item i n m u n i c i p a l revenues, next .to the r e a l p r o p e r t y tax ( P l u n k e t t , 1971) . On the other hand, p r o v i n c i a l a i d i s a l s o g i v e n through c o n d i t i o n a l grants by which funds are made a v a i l a b l e f o r a s p e c i f i c e xpenditure, such as f o r s o c i a l a s s i s t a n c e , highway c o n s t r u c -t i o n or r a p i d t r a n s i t f a c i l i t i e s . These grants are u s u a l l y based on p o p u l a t i o n , assessments or p a r t i c u l a r need. I t i s important to note t h a t although m u n i c i p a l i -t i e s can l e v y a v a r i e t y of l i c e n c e and permit f e e s , s e r v i c e charges, e t c . , the bulk of m u n i c i p a l revenue i s d e r i v e d from two main sources: 1. the tax on r e a l p r o p e r t y , and 2. p r o v i n c i a l a s s i s t a n c e . The f o l l o w i n g t a b l e shows how much of t o t a l annual m u n i c i p a l revenue i s d e r i v e d from pr o p e r t y t a x a t i o n and p r o v i n c i a l a s s i s t a n c e , f o r v a r i o u s years from 1962 to 1977. The f i g u r e s i n t h i s t a b l e - e x t r a c t e d from M u n i c i p a l S t a t i s - t i c s , p u b l i s h e d by the p r o v i n c i a l government - r e p r e s e n t s the t o t a l a p p l i c a b l e revenues f o r a l l c i t i e s , m u n i c i p a l d i s t r i c t s , towns and v i l l a g e s i n the province.. The amount of r e a l p r o p e r t y t a x a t i o n and p r o v i n c i a l a s s i s t a n c e i s a l s o broken down i n t o percentages which shows the r e l a t i o n s h i p to the t o t a l annual m u n i c i p a l revenue. 30 TABLE 1 THE AMOUNTS OF ANNUAL MUNICIPAL REVENUES DERIVED FROM REAL PROPERTY TAXATION AND PROVINCIAL ASSISTANCE IN BRITISH COLUMBIA, SHOWING PERCENTAGES OF TOTAL ANNUAL MUNICIPAL REVENUES 1962 - 1977 Survey Year T o t a l Annual M u n i c i p a l Revenue Annual M u n i c i p a l Revenue Derived From Real Property T a x a t i o n , * Showing Percentage of T o t a l M u n i c i p a l Revenue Annual M u n i c i p a l Revenue Derived From P r o v i n c i a l A s s i s t a n c e Showing Percen-tage of T o t a l M u n i c i p a l Revenue 1962 192,138,725 116,275,341 (60.5%) 33,132,998 (17.2%) 1964 220,533,146 138,895,232 (63.0%) 34,666,878 (15.7%) 1967 328,064,188 201,657,602 (61.5%) 60,672,085 (18.5%) 1968 376,330,030 223,578,999 (59.4%) 76,344,669 (20,3%) 1969 425,046,626 254,864,158 (60.0%) 86,006,058 (20.2%) 1971 542,533,209 326 ,008,220 (60.1%) 114,002,858 (21.0%) 1972 600,312,733 361,954,793 (60.3%) 123,142,851 (20.5%) 1974 781,378,216 508,640,348 (65.1%) 112,490,689 (14,4%) 1976 1,122,084,516 755,198,950 (67.3%) 140,235,479 (12.5%) 1977 1,160,050,317 815,586,821 (70.3%) 114,700,915 ( 9.9%) * I n c l u d i n g c o l l e c t i o n s f o r sc h o o l d i s t r i c t s and other governments. Source: M u n i c i p a l S t a t i s t i c s (1962, 1964, 1967, 1968, 1969, 1971, 1972, 1974, 1976, 1977). 31 While p r o v i n c i a l a s s i s t a n c e r e p r e s e n t s a c o n s i d e r -a b l e p r o p o r t i o n of m u n i c i p a l revenue, these funds are a l l o c a t e d on whatever b a s i s and i n whatever amount as may be determined by the p r o v i n c e ( P l u n k e t t , 1971). In other words, m u n i c i p a l i t i e s have no c o n t r o l over the annual amounts p r o v i d e d under the v a r i o u s grant programs, nor can they c o n t r o l the c o n d i t i o n s which may be imposed by the p r o v i n c e with r e s p e c t to t h e i r p r o v i s i o n . Column 3 of the above noted t a b l e shows the v a r i a t i o n i n p r o v i n c i a l a s s i s -tance which may occur from year to year. The t a b l e shows the p r o v i n c i a l a s s i s t a n c e can r e p r e s e n t as much as 21 per cent of t o t a l annual revenue i n one year (1971) , but can be reduced to as low as 9.9 per cent i n another year (1977). The tax on r e a l p r o p e r t y i s the o n l y s i g n i f i c a n t independent source of revenue a v a i l a b l e to m u n i c i p a l i t i e s . However, m u n i c i p a l i t i e s do not have complete autonomy i n t h i s regard, and are r e s t r i c t e d by s e v e r a l f a c t o r s . F i r s t l y , the c o u n c i l s must adhere to the s t a t u t o r y r e g u l a t i o n s con-c e r n i n g t a x a t i o n which d e f i n e the ways, means and manner whereby taxes are assessed, l e v i e d and c o l l e c t e d . Secondly, the c o u n c i l s must keep i n mind the probable l i m i t o f the tax burden which r e a l p r o p e r t y can be made to c a r r y . In t h i s regard, there i s no accepted f i x e d p o i n t a t which i t can be s a i d t h a t the l i m i t o f t a x a t i o n has been reached, but i t i s e v i d e n t t h a t such l i m i t has been passed when any c o n s i d e r a b l e number of p r o p e r t y owners p r e f e r to l e t t h e i r p r o p e r t i e s be s o l d f o r a r r e a r s of taxes r a t h e r than to pay the taxes and r e t a i n t h e i r p r o p e r t i e s (Crawford, 1954). 32 F i n a l l y , w h i l e the m u n i c i p a l i t i e s are the tax c o l l e c t i o n agency, they are not allowed the f u l l u t i l i z a t i o n of the y i e l d due to o b l i g a t o r y f u n c t i o n s which consume a l a r g e p r o p o r t i o n of the r e t u r n . (This l a t t e r f a c t o r w i l l be d i s c u s s e d i n g r e a t e r d e t a i l i n the f o l l o w i n g s e c t i o n , S e c t i o n 3.4.) 3.4 The F i n a n c i a l I m p l i c a t i o n s of M u n i c i p a l Expenditures and Revenues:  Once the annual expenditure program and the revenues needed to achieve i t s commitments have been forma-l i z e d , the c o u n c i l l o r ' s 1 problems have not been ended. Almost on a d a i l y b a s i s , m u n i c i p a l c o u n c i l s are requested to p r o v i d e a d d i t i o n a l funding f o r a v a r i e t y of reasons. Some o f these requests may be of v a l u a b l e s e r v i c e to the l o c a l community or a requirement to undertake a d d i t i o n a l f u n c t i o n s imposed by the p r o v i n c i a l government, i n which case, c o u n c i l s may be o b l i g a t e d to f i n a n c e them, w h i l e other requests may be of l e s s e r p r i o r i t y and are t r e a t e d a c c o r d i n g l y . I t i s important a t t h i s time to undertake a b r i e f review of some of the major requests which are c a u s i n g the f i n a n c i a l s t r a i n s i n m u n i c i p a l government, i n order to f u l l y comprehend the m u n i c i p a l f i n a n c i a l p i c t u r e . In a d d i t i o n to the causes, the i m p l i c a t i o n s they impose on m u n i c i p a l f i n a n c e w i l l a l s o be d i s c u s s e d - i n p a r t i c u l a r , i t s r e l e v a n c e to the B r i t i s h Columbia s i t u a t i o n . 33 Urban P o p u l a t i o n Growth: One o f the primary causes o f the i n c r e a s e d s t r a i n s i n m u n i c i p a l f i n a n c e has been the r a p i d growth o f m e t r o p o l i -tan p o p u l a t i o n . For b e t t e r or f o r worse, urban areas throughout North America have been growing; i n some cases, at alarming r a t e s . Among other t h i n g s , t h i s means the com-pounding of mass t r a n s i t problems, the pressure f o r new water s u p p l i e s and f o r added drainage and sewage d i s p o s a l f a c i l i t i e s , and the urgent need f o r many other primary s e r v i c e s . Abundant evidence ( I s a r d , 1957; P e t t e n g i l , 1974; P l u n k e t t , 1971; S t e r n l i e b , 1973) has been amassed to demon-s t r a t e the impact urban growth i s having on our everyday l i f e . When reviewing urban p o p u l a t i o n growth r a t e s , i t i s e a s i l y seen t h a t B r i t i s h Columbia has experienced i t s f a i r share of t h i s growth. Since the t u r n o f the century to the e a r l y 1970's, the p o p u l a t i o n growth r a t e f o r t h i s p r o v i n c e has exceeded the r a t e f o r Canada (see Table 1 of Appendix 2). In more r e c e n t times, between 1951 and 1971, p o p u l a t i o n i n B r i t i s h Columbia grew from 1,165,210 to 2,184,600 - an i n c r e a s e of 39.8 per cent between 1951 and 1961, and an i n c r e a s e of 34.1 per cent between 1961 and 1971. The corresponding growth r a t e f o r Canada i n the years 1951 to 1961 was 30.2 per cent and 18.3 per cent f o r the years 1961 to 1971. The p o p u l a t i o n f o r the p r o v i n c e i n 1975 was estimated to be 2,457,000 - an i n c r e a s e of 12.5 per cent i n four years (Pennance, 1976). 34 The p o p u l a t i o n i n B r i t i s h Columbia has not onl y been i n c r e a s i n g by n a t u r a l growth ( i . e . , b i r t h s minus dea t h s ) , but a l s o through immigration, both a t the n a t i o n a l and i n t e r -n a t i o n a l s c a l e . The 1971 Census computation r e v e a l s t h a t approximately o n e - t h i r d of the 1961-1971 growth r a t e i n B r i t i s h Columbia was d e r i v e d from n a t u r a l growth. The remaining two-thirds o f the 1961-1971 growth r a t e was from net immigration, approximately one-half o f which was i n t e r -n a t i o n a l , o n e - h a l f from other p a r t s o f Canada. The p r o v i n c i a l growth r a t e has had c o n s i d e r a b l e e f f e c t upon the urban areas i n B r i t i s h Columbia, s i n c e the m a j o r i t y o f the growth has o c c u r r e d i n these areas. When rev i e w i n g s t a t i s t i c s , i t i s not uncommon nor u n r e a l i s t i c to d i s c o v e r t h a t many l o c a l i t i e s i n B r i t i s h Columbia have experienced a growth r a t e exceeding 100 per cent i n the 20 years between 1951 and 1971. Table 2 of Appendix 2 shows some of the major urban c e n t r e s i n B r i t i s h Columbia and t h e i r r e s p e c t i v e p o p u l a t i o n growth r a t e s f o r t h i s p e r i o d . P o p u l a t i o n growth i n the pr o v i n c e has not o n l y caused the urban areas to i n c r e a s e i n terms of the number of people, but i t has a l s o g r e a t l y a l t e r e d the p h y s i c a l s i z e , shape and d e n s i t y o f the v a r i o u s communities. From 1951 to 1961, the urban areas* i n B r i t i s h Columbia grew from * The term "urban area" i n t h i s c ontext r e f e r s to the Census d e f i n i t i o n : " i n c l u d e s the p o p u l a t i o n l i v i n g i n (1) i n c o r -porated c i t i e s , towns and v i l l a g e s , w i t h a p o p u l a t i o n of 1,000 o r over; (2) uni n c o r p o r a t e d p l a c e s of 1,000 or over, having a p o p u l a t i o n d e n s i t y o f a t l e a s t 1,000 per square mi l e ; (3) the b u i l t up f r i n g e o f (1) and (2), having a minimum p o p u l a t i o n o f 1,000 and a d e n s i t y o f a t l e a s t 1,000 per square m i l e . " 35 a t o t a l of 232,015 r e s i d e n t i a l u n i t s o f a l l types* to a t o t a l of 341,559, an i n c r e a s e i n u n i t s of 47.21 per cent. From 1961 to 1971, there was a f u r t h e r 52.54 per cent i n c r e a s e i n the number of r e s i d e n t i a l u n i t s i n urban areas r e p r e s e n t i n g a t o t a l , i n 1971, of 521,000 u n i t s . I t must be remembered t h a t these f i g u r e s r e f e r to r e s i d e n t i a l u n i t s o n l y . They do not take i n t o account any c o n current com-m e r c i a l , o f f i c e , i n d u s t r i a l or i n s t i t u t i o n a l s t r u c t u r e s which were c o n s t r u c t e d d u r i n g t h i s p e r i o d . Although the most r e c e n t Census m a t e r i a l shows t h a t the p o p u l a t i o n growth r a t e i n B r i t i s h Columbia i s now s t a b i l i z i n g , there are numerous m u n i c i p a l i m p l i c a t i o n s r e s u l t i n g from the past p o p u l a t i o n growth and c o n current p h y s i c a l expansion o f urban areas. I t i s probably s a f e to say t h a t one of the g r e a t e s t impacts has been on f i n a n c i n g the s e r v i c e s f o r the newly developed areas. In new suburban developments, e n t i r e p h y s i c a l p l a n t s are sometimes r e q u i r e d i n order to supply the modern urban amenities t h a t people now assume as e s s e n t i a l s e r v i c e s . Expansion or new con-s t r u c t i o n of a r t e r i a l and c o l l e c t o r road systems, s a n i t a r y and storm sewer f a c i l i t i e s , and water s u p p l i e s are but a few examples o f the primary i n f r a s t r u c t u r e which i s r e q u i r e d to accommodate i n c r e a s e d growth. A l a r g e p r o p o r t i o n of the f i n a n c i a l burden i s a l s o being caused by the p u b l i c and s o c i a l o r i e n t a t e d s e r -* " r e s i d e n t i a l u n i t s of a l l types" i n c l u d e : s i n g l e detached, s i n g l e a t tached, apartment or f l a t and mobile homes, as d e f i n e d by the Census. 36 v i c e s which new developments are demanding. The c o s t s f o r such s e r v i c e s as added p o l i c e and f i r e p r o t e c t i o n , a c q u i s i t i o n and development of parks and r e c r e a t i o n f a c i l i -t i e s , as w e l l as l a n d and o t h e r requirements f o r e d u c a t i o n a l needs, are f u r t h e r f i n a n c i a l encumbrances which m u n i c i p a l i -t i e s must f a c e . The main reason why urban growth imposes a f i n a n -c i a l burden on m u n i c i p a l i t i e s i s because the above noted c o s t s a s s o c i a t e d w i t h growth r e p r e s e n t a d d i t i o n a l c o s t s to the a l r e a d y e x i s t i n g commitments to the developed areas. While the suburban areas may be undergoing change and r e q u i r i n g a g r e a t d e a l of m u n i c i p a l revenue, there i s f r e q u e n t l y l i t t l e o r no o f f s e t t i n g r e d u c t i o n i n expenditures i n the developed areas. U s u a l l y , the l a t t e r f i n d t h e i r t r a f f i c , s a f e t y and w e l f a r e problems i n t e n s i f i e d by the i n c r e a s i n g area-wide p o p u l a t i o n . Moreover, toi f u r t h e r compound t h i s matter, muni-c i p a l i t i e s are o f t e n viewed as the medics f o r the s o c i a l i l l s and growth pains c r e a t e d by the expanded p o p u l a t i o n . The i n c r e a s e i n the crime r a t e , p o l l u t i o n , c o n g e s t i o n and other s o c i a l d i s o r d e r s are o f t e n - through a c c r e t i o n or otherwise - p l a c e d w i t h i n the realm o f m u n i c i p a l respon-s i b i l i t y . A l l i n a l l , the e f f e c t of these f a c t o r s a s s o c i a t e d w i t h growth, g r e a t l y c o n t r i b u t e to the v a s t accumulation of m u n i c i p a l f i n a n c i a l l i a b i l i t i e s . 3 7 R i s i n g A s p i r a t i o n s : In a d d i t i o n to the growth pains r e s u l t i n g from i n c r e a s i n g p o p u l a t i o n , p u b l i c o u t c r y f o r more and b e t t e r s e r v i c e s - w i t h i n the l i m i t s of the e x i s t i n g tax payments -has a l s o had a s i g n i f i c a n t impact on the f i n a n c i a l r e s o u r c e s of m u n i c i p a l governments. Today, i t i s not uncommon to see community or l o c a l r a t e payer groups or oth e r o r g a n i z a t i o n s approach c o u n c i l demanding an i n c r e a s e i n s e r v i c i n g standards or f i n a n c i a l support f o r a new community program or s p e c i a l p r o j e c t . With t h i s type of p u b l i c involvement, i t would appear t h a t m u n i c i p a l i t i e s are advancing i n t o a new era; l e a v i n g behind a time when taxpayers e x h i b i t e d p a s s i v e endurance, to a time when they are no longer r e q u e s t i n g but are demanding a c t i o n from the m u n i c i p a l i t y . A conspicuous example of t h i s c u r r e n t t r e n d can be r e l a t e d to the r e l a t i v e l y r e c e n t and widespread use of auto-motive t r a n s p o r t a t i o n f o r m o b i l i t y . While the q u a l i t y o f e a r l i e r roads may have been s u f f i c i e n t f o r p a s t times, the r i s i n g demands are f o r b e t t e r roads and paved s t r e e t s w i t h curbs and g u t t e r s , p a r k i n g r e g u l a t i o n s and t r a f f i c c o n t r o l , s t r e e t widening, improved l i g h t i n g , snow removal, grade s e p a r a t i o n , e t c . , with these newly added s e r v i c e s c r e a t i n g a d d i t i o n a l p r essure on the a l r e a d y s t r a i n i n g m u n i c i p a l c o f f e r s . Once an a d d i t i o n a l s e r v i c e i s s u p p l i e d , t h i s new avenue of expenditure, more o f t e n than naught, tends to become p e r p e t u a l . Thus, i f snow removal from the s t r e e t s 38 i s undertaken i n an extremely severe w i n t e r to appease the l o c a l populace, i t i s almost i n e v i t a b l e t h a t the m o t o r i s t s w i l l demand t h a t i t be done every w i n t e r and t h a t the number of s t r e e t s from which i t i s removed be c o n t i n u o u s l y exten-ded. Through s i m i l a r experiences such as t h i s , many m u n i c i -p a l i t i e s have l e a r n e d t h a t f r e q u e n t l y the f i r s t c o s t i s not n e c e s s a r i l y the l a s t or t o t a l c o s t . The o l d adage, "give them ( i . e . , the p u b l i c ) an i n c h and t h e y ' l l want a m i l e " holds much t r u t h . M u n i c i p a l O b l i g a t o r y Functions In a d d i t i o n to the f i n a n c i a l s t r a i n s of s u p p l y i n g more and h i g h e r q u a l i t y s e r v i c e s - which c o u l d be c l a s s i -f i e d as d i s c r e t i o n a r y expenditures (as p r e v i o u s l y discussed) s i n c e they c o n s t i t u t e housekeeping d u t i e s and the m u n i c i -p a l i t y when p r o v i d i n g these s e r v i c e s i s a c t i n g i n i t s m u n i c i p a l c a p a c i t y - the m u n i c i p a l i t y i s a l s o faced w i t h a r a p i d l y i n c r e a s i n g demand to p r o v i d e more funds f o r o b l i g a t o r y f u n c t i o n s . As these f u n c t i o n s are r e q u i r e d by the p r o v i n c i a l l e g i s l a t u r e , l o c a l governments have l i t t l e or no c o n t r o l over the amount they must c o n t r i b u t e . Of main concern, i n t h i s regard, i s the m u n i c i p a l c o n t r i b u t i o n towards education and s o c i a l w e l f a r e s e r v i c e s . While the tax on r e a l p r o p e r t y i s the p r i n c i p l e source of m u n i c i p a l revenue, m u n i c i p a l i t i e s do not have f u l l c o n t r o l over i t s u t i l i z a t i o n . A l a r g e p r o p o r t i o n of the y i e l d must be a l l o c a t e d to education and s o c i a l 39 w e l f a r e s e r v i c e s s i n c e the p r o v i n c i a l l e g i s l a t u r e has deemed them mandatory r e s p o n s i b i l i t i e s . Of primary i n t e r e s t i s e d u c a t i o n , because i t i s c u r r e n t l y absorbing a l a r g e p r o p o r t i o n of m u n i c i p a l tax d o l l a r s . The p r o p o r t i o n of p r o p e r t y taxes r e q u i r e d f o r education i s ever i n c r e a s i n g i n B r i t i s h Columbia. An a n a l y s i s conducted by T.J. P l u n k e t t and A s s o c i a t e s (1971) f o r the Union of B r i t i s h Columbia M u n i c i p a l i t i e s , r e v e a l s t h a t the p r o p o r t i o n of the p r o p e r t y tax remaining under the c o n t r o l of m u n i c i p a l governments had d e c l i n e d s u b s t a n t i a l l y between 1957 and 1968 - from 59.4 per cent i n 1957 to 45.7 per cent i n 1968. Conversely, the p r o p o r t i o n of m u n i c i p a l tax d o l l a r s r e q u i r e d f o r e d u c a t i o n had i n c r e a s e d from 40.6 per cent i n 1957 to 54 .3 per cent i n 1968. The i n f o r m a t i o n gathered by P l u n k e t t , p a r t i c u l a r l y f o r the l a t t e r p a r t of the 1950's and the e a r l y 1960's, i s of prime s i g n i f i c a n c e to t h i s study, as i t r e p r e s e n t s the p e r i o d when m u n i c i p a l i -t i e s began to search out a l t e r n a t e sources of revenue due to f i n a n c i a l s t r a i n s . Based on the r e s u l t s from the study, P l u n k e t t (1971) s t a t e s thus: ". . . o f the t o t a l y i e l d from the tax on r e a l p r o p e r t y - the p r i n c i p a l source of revenue a v a i l a b l e to m u n i c i p a l i t i e s - m u n i c i p a l govern-ments were only able to r e t a i n . . . 45.7C of every $1.00 they c o l l e c t e d i n 1968 and 54.3C must be turned over f o r the support of e d u c a t i o n - a s e r v i c e f o r which m u n i c i p a l i t i e s have no r e s p o n s i b i l i t y and f o r which they merely a c t as the tax c o l l e c t i n g agency." P l u n k e t t (1971) goes on to say t h a t "because of t h i s , i t i s l i k e l y t h a t m u n i c i p a l governments have on l y one a l t e r -n a t i v e i n t h e i r e f f o r t s to keep the r e a l p r o p e r t y tax l e v y 40 w i t h i n reasonable bounds and t h a t i s to c u r t a i l expenditures f o r p u r e l y m u n i c i p a l purposes." The f o l l o w i n g t a b l e -showing the t o t a l annual m u n i c i p a l revenue c o l l e c t e d by a l l c i t i e s , m u n i c i p a l d i s t r i c t s , towns and v i l l a g e s i n B r i t i s h Columbia and the amount of t h i s revenue apportioned to school d i s t r i c t purposes - r e f l e c t s P l u n k e t t ' s concern. P l u n k e t t (1971) a l s o observed t h a t the m u n i c i p a l c o s t of p r o v i d i n g s o c i a l w e l f a r e s e r v i c e s was s i m i l a r l y i n c r e a s i n g , although not a t the same r a t e as e d u c a t i o n a l c o s t s . His f i n d i n g s show t h a t i n B r i t i s h Columbia, the t o t a l expenditure on s o c i a l w e l f a r e rose from $25 m i l l i o n i n 1964 to $58 m i l l i o n i n 1969. While he p o i n t s out t h a t the s o c i a l a s s i s t a n c e grant - which r e p r e s e n t s a c o n d i t i o n a l grant, as p r e v i o u s l y d i s c u s s e d , from the p r o v i n c i a l government - had a l s o i n c r e a s e d d u r i n g the same y e a r s , he found t h a t the c o s t s of s o c i a l w e l f a r e had r i s e n a t a f a s t e r pace with the r e s u l t t h a t net m u n i c i p a l expen-d i t u r e s ( t o t a l expenditure l e s s s o c i a l a s s i s t a n c e grants) represented a l a r g e r p r o p o r t i o n of t o t a l w e l f a r e o u t l a y s than they had formerly. In essence, then, the i n c r e a s e d expenditures on s o c i a l w e l f a r e had r e s p e c t i v e l y decreased the amount of funds f o r m u n i c i p a l purposes. Table 3 s u b s t a n t i a t e s P l u n k e t t ' s o b s e r v a t i o n s . The p r i n c i p a l concern of m u n i c i p a l governments i n B r i t i s h Columbia, with r e s p e c t to i n c r e a s e d expenditures on both education and w e l f a r e , i s t h a t t h e i r share of the main component of m u n i c i p a l revenue ( i . e . , p r o p e r t y taxes) 41 TABLE 2 THE ANNUAL AMOUNTS OF REVENUE DERIVED FROM REAL PROPERTY TAXATION APPORTIONED TO SCHOOL DISTRICT PURPOSES IN BRITISH COLUMBIA 1962 - 1977 Survey Year Annual M u n i c i p a l Revenue Derived From Real Property Taxation ( i n c l u d i n g c o l l e c t i o n s f o r s c h o o l d i s t r i c t s and other governments) Annual Revenues From Real Property T a x a t i o n f o r School D i s t r i c t Purposes With Percentages 1962 116,275,341 52,634,116 (45.3%) 1964 138,895,232 65,872,785 (47.4%) 1967 201,657,602 107,641,589 (53.4%) 1968 223,578,999 121,444,558 (54.3%) 1969 254,864,158 137,359,034 (53.9%) 1971 326,008,220 165,621,305 (50.8%) 1972 361,954,793 181,117,224 (50.0%) 1974 508,640,348 261,318,034 (51.4%) 1976 755,198,950 404,102,589 (53.5%) 1977 815 ,586 , 821 431,228,995 (52.9%) Source: M u n i c i p a l S t a t i s t i c s (1962, 1964, 1967, 1968, 1969, 1971, 1972, 1974, 1976, 1977). 42 T A B L E 3 T H E T O T A L ANNUAL E X P E N D I T U R E S FOR S O C I A L W E L F A R E , SHOWING P R O V I N C I A L GOVERNMENT AND M U N I C I P A L GOVERNMENT C O N T R I B U T I O N S 1962 - 1977 Survey Year T o t a l Annual Expenditures f o r S o c i a l Welfare ( i n c l u d i n g the p r o v i n c i a l government grant) Annual C o n d i t i o n a l Grants From the P r o v i n c i a l Govern-ment f o r S o c i a l Welfare Annual M u n i c i p a l C o n t r i b u t i o n f o r S o c i a l Welfare 1962 402,233 18,713,880 1964 25,425,054 19,875,956 5,549,098 1967 38,152,056 30,697,446 7,454,610 1968 49,957,451 35,212,831 14,744,620 1969 57,847,415 39,687,505 18,159,910 1971 90,768,688 63,620,930 27,147,758 1972 88,684,398 66,083,771 22,600,627 1974 64,740,446 38,632,178 26,108,268 1976 59,515,446 24,004,207 35,511,239 1977 35,561,387 3,473,651 32,087,736 Source: M u n i c i p a l S t a t i s t i c s (1962, 1964, 1967, 1968, 1969, 1971, 1972, 1974, 1976, 1977). 43 i s d i m i n i s h i n g . Consequently, the m u n i c i p a l i t i e s ' a b i l i -t i e s to respond to the ever i n c r e a s i n g demand f o r t h e i r housekeeping f u n c t i o n s , as p r e v i o u s l y d i s c u s s e d , i s a l s o reduced. 3.5 Summary and C o n c l u s i o n s : During r e c e n t y e a r s , many m u n i c i p a l i t i e s i n B r i t i s h Columbia have been e x p e r i e n c i n g s e r i o u s f i n a n c i a l problems. The main c o n t e n t i o n of these m u n i c i p a l i t i e s i s t h a t t h e i r sources of revenue do not generate s u f f i c i e n t funds to pay f o r the m u l t i t u d e of o b l i g a t o r y and d i s -c r e t i o n a r y d u t i e s imposed upon them. Too o f t e n , m u n i c i p a l c o u n c i l s are p l a c e d i n the p o s i t i o n of having to r e f u s e r e q u e s t s , which may be of g r e a t value to the community, simply because they do not have the f i n a n c i a l c a p a b i l i t y to support new a c t i v i t i e s . A review of the m u n i c i p a l e x p e n d i t u r e s , the sources of revenue and t h e i r i m p l i c a t i o n s helps to p o i n t out the reasons why m u n i c i p a l i t i e s are e x p e r i e n c i n g t h i s f i n a n c i a l s t r a i n . The f o l l o w i n g synopsized l i s t r e p r e s e n t s the more important f a c t o r s which were d i s c u s s e d i n the body of t h i s chapter. 1. One of the prime reasons why m u n i c i p a l i t i e s are f i n a n c i a l l y r e s t r i c t e d i s because, as noted above, t h e i r sources o f revenue do not have the f l e x i b i l i t y to generate s u f f i c i e n t funds to pay f o r the m u l t i t u d e of m u n i c i p a l a c t i v i t i e s . A p r i n c i p l e concern i s the 44 heavy dependence on the pr o p e r t y tax - the mu n i c i -p a l i t y ' s main source of revenue. Although p r o p e r t y t a x a t i o n r e p r e s e n t s the o n l y s i g -n i f i c a n t independent source of revenue a v a i l a b l e to m u n i c i p a l i t i e s , the use of t h i s method of t a x a t i o n i s very r e s t r i c t i v e . In the f i r s t p l a c e , m u n i c i p a l i -t i e s are bound by s t a t u t o r y r e g u l a t i o n s concerning the ways, means and manner i n which these taxes can be assessed and c o l l e c t e d ; and, i n the second p l a c e , the m u n i c i p a l i t i e s must keep i n mind the probable l i m i t of the tax burden which p r o p e r t y owners can be made to c a r r y . Furthermore, s i n c e a l a r g e p r o p o r t i o n of the y i e l d from t h i s tax must be a l l o c a t e d to o b l i -gatory f u n c t i o n s , the impact of the amount remaining f o r m u n i c i p a l purposes i s g r e a t l y reduced. 2. The use of the m u n i c i p a l i t y ' s second b e s t source o f revenue - p r o v i n c i a l a s s i s t a n c e - s i m i l a r to p r o p e r t y t a x a t i o n , i s a l s o very r e s t r i c t i v e . In many i n s t a n c e s , p r o v i n c i a l a s s i s t a n c e i s made a v a i l a b l e i n the form of c o n d i t i o n a l grants and must t h e r e f o r e be used f o r a s p e c i f i c purpose, as s p e c i f i e d by the p r o v i n c e . In any case, m u n i c i p a l i t i e s have no c o n t r o l over the annual amounts p r o v i d e d under the v a r i o u s grant pro-grams, nor can they c o n t r o l the c o n d i t i o n s which may be imposed by the p r o v i n c e . 3. While the m u n i c i p a l i t i e s ' sources of revenue are very l i m i t e d , the extent o f p o s s i b l e e x p e n d i t u r e s , on the other hand, are almost l i m i t l e s s . The c o s t s a s s o c i a t e d 45 with the r e c e n t phenomena of urban p o p u l a t i o n growth re p r e s e n t s a good example. With urban p o p u l a t i o n growth r a t e s exceeding 10 0 per cent i n the l a s t 2 0 years i n some l o c a l i t i e s i n B r i t i s h Columbia, i t i s not d i f f i c u l t to understand the magnitude of the s e r v i c i n g problems and the r e s u l t i n g f i n a n c i a l i m p l i -c a t i o n s f a c i n g m u n i c i p a l i t i e s . Expansion or new c o n s t r u c t i o n of roadways, sewer f a c i l i t i e s and water s u p p l i e s are a few examples of the primary i n f r a s t r u c -ture r e q u i r e d by new developments. In a d d i t i o n , s o c i a l o r i e n t a t e d s e r v i c e s , such as the p r o v i s i o n of parks and r e c r e a t i o n a l f a c i l i t i e s , and the p r o t e c t i v e s e r v i c e s , such as f i r e and p o l i c e p r o t e c t i o n , are other c o s t s which m u n i c i p a l i t i e s must f i n d revenues to support. The crux of the problem, i s t h a t , any new expenditures - such as those c o s t s a s s o c i a t e d with growth - r e p r e s e n t a d d i t i o n a l c o s t s to the a l r e a d y e x i s t i n g commitments. 4. The r i s i n g a s p i r a t i o n s of the p u b l i c has a l s o had a s i g n i f i c a n t impact on m u n i c i p a l f i n a n c e . L o c a l r a t e payer groups and other community o r g a n i z a t i o n s , as w e l l as i n d i v i d u a l r e s i d e n t s are demanding more and b e t t e r s e r v i c e s f o r t h e i r tax d o l l a r . The r e s u l t i s a d d i t i o n a l p r essure on the a l r e a d y s t r a i n e d m u n i c i p a l c o f f e r . 5. In some cases, a l s o , the p r o v i n c i a l a u t h o r i t i e s have r e q u i r e d m u n i c i p a l i t i e s to undertake a d d i t i o n a l f i n a n c i a l commitments wi t h r e s p e c t to t h e i r o b l i g a t o r y 46 f u n c t i o n s . Such i s the case with e d u c a t i o n and s o c i a l w e l f a r e s e r v i c e s . During r e c e n t y e a r s , m u n i c i p a l i t i e s have found t h a t they are c o n t r i b u t i n g more and more of t h e i r revenue i n support of these s e r v i c e s . Con-sequently, of the t o t a l amount of revenue c o l l e c t e d by a m u n i c i p a l i t y , the amount which remains f o r s p e c i f i c a l l y m u n i c i p a l purposes i s decreased r e s p e c -t i v e l y . There i s no reason to suppose t h a t the upward tre n d i n m u n i c i p a l expenditures w i l l not continue. As the wants of the people expand and they r e a l i z e the ext e n t to which these wants can be s u p p l i e d by community a c t i o n , there i s l i k e l y to be a s u s t a i n e d demand f o r expanded l o c a l government a c t i v i t y . In the s o c i a l s e r v i c e s , there i s almost no l i m i t to the p o s s i b i l i t y of expansion, Other than the l i m i t o f revenue. Other types of s e r v i c e s are l i k e l y to continue a l s o , s i n c e m u n i c i p a l i t i e s have demon-s t r a t e d t h e i r c a p a c i t y to perform a wide range of s e r v i c e s with reasonable e f f i c i e n c y . T h i s w i l l p l a c e m u n i c i p a l i t i e s i n a more s e r i o u s f i n a n c i a l predicament than p r e s e n t l y e x i s t s . C o n s i d e r i n g the c o n t i n u a t i o n of t h i s t r e n d , m u n i c i p a l i t i e s w i l l have to show r e l u c t a n c e i n responding to these demands. So long as the e x i s t i n g b a s i s o f m u n i c i p a l t a x a t i o n remains, m u n i c i p a l i t i e s w i l l be compelled to keep i n mind the l i m i t s o f the burden which a r e s t r i c t e d source of revenue can be expected to bear. 47 CHAPTER FOUR  THE IMPOST FEE IN BRITISH COLUMBIA: 1960-1977 4.1 I n t r o d u c t i o n : Many m u n i c i p a l i t i e s i n B r i t i s h Columbia have become f i n a n c i a l l y s t r a i n e d because t h e i r sources of revenue are not s u f f i c i e n t f o r them to perform t h e i r o b l i g a t o r y and d i s c r e t i o n a r y d u t i e s . ~ T h i s problem i s f u r t h e r com-pounded by the e v e r - i n c r e a s i n g demands f o r more and b e t t e r s e r v i c e s and the subsequent c o m p e t i t i o n between these demands f o r the a v a i l a b l e funds. M u n i c i p a l i t i e s encountering t h i s type of s i t u a t i o n are f o r c e d t o choose one or a combination of three a l t e r -n a t i v e s : 1. they can r e - e v a l u a t e and r e - a d j u s t t h e i r c u r r e n t sources of revenue to meet the demand ( i . e . , r a i s e p r o p e r t y t a x e s ) ; o r, 2. s i n c e the m u n i c i p a l i t i e s are under no formal o b l i g a -t i o n to pr o v i d e housekeeping s e r v i c e s , they can reduce t h e i r expenditures on d i s c r e t i o n a r y s e r v i c e s ; or, 3. they can r e s o r t to new sources of income. Numerous m u n i c i p a l i t i e s have employed one or more of the three techniques and have experienced v a r i e d successes. However, i t would appear t h a t i n B r i t i s h Columbia, the l a t t e r a l t e r n a t i v e has been a popular c h o i c e ; 48 mainly because the c o u n c i l members have u s u a l l y regarded e x o r b i t a n t tax i n c r e a s e s and r e d u c t i o n s i n the q u a n t i t y and q u a l i t y of m u n i c i p a l s e r v i c e s to be p o l i t i c a l l y unacceptable. Thus, many m u n i c i p a l i t i e s have had to r e s o r t to the use of new sources of income. The impost fee, which was designed to de f r a y the m u n i c i p a l c o s t s of p r o v i d i n g s e r v i c e s to new develop-ment areas was one means t h a t was popular among many muni-c i p a l i t i e s i n B r i t i s h Columbia i n the 1960's and the e a r l i e r h a l f of the 1970's. Chapter Four dea l s s p e c i f i c a l l y w i t h the impost fee as i t a p p l i e d to B r i t i s h Columbia d u r i n g the e a r l y 1960's to 1977. The concept and i t s use i n the pr o v i n c e d u r i n g t h i s p e r i o d , w i l l form the major focus o f t h i s chapter. As the development c o s t charge l e g i s l a t i o n , which was i n t r o d u c e d i n t o the m u n i c i p a l scene i n 1977, has r e s u l t e d i n s i g n i f i c a n t changes i n t h i s p a r t i c u l a r aspect o f m u n i c i p a l f i n a n c e , t h i s chapter w i l l d i s c u s s the h i s t o r i c a l m a t e r i a l which precedes this' l e g i s l a t i o n . The f o l l o w i n g chapter w i l l review the r e c e n t l e g i s l a t i o n and d i s c u s s i t s i m p l i c a -t i o n s . 4.2 The Impost Fee - The Concept: In B r i t i s h Columbia, the impost fee has become one o f s e v e r a l v e h i c l e s which have been employed by muni-49 c i p a l i t i e s to t r a n s f e r the c o s t s of m u n i c i p a l s e r v i c e s generated by new developments to the developers or the subsequent owners of the p r o p e r t y . Some of the other techniques which are now w e l l e s t a b l i s h e d w i t h i n the m u n i c i p a l o p e r a t i o n are: frontage taxes, connection char-ges, l o c a l improvement l e v i e s , as w e l l as the other methods l i s t e d i n the preceding chapter. These sources of revenue have s p e c i f i c purposes and are a p p l i c a b l e i n c e r t a i n i n s t a n c e s as s p e c i f i e d i n the M u n i c i p a l Act, and should not be confused with the impost f e e . In very g e n e r a l terms, the impost fee i s a l e v y which i s assessed a g a i n s t a developer by a m u n i c i p a l i t y to d e f r a y the m u n i c i p a l c o s t s of p r o v i d i n g s e r v i c e s to new developments. I t s b a s i c i n t e n t i s to meet the demand f o r new and improved s e r v i c e s by imposing a f i n a n c i a l r e q u i r e -ment on those lands t h a t c r e a t e the demand. I t should be understood t h a t the imposts are not the costs i n c u r r e d by the developer r i g h t i n ' f r o n t of h i s p r o p e r t y , or w i t h i n the boundaries of h i s development. These c o s t s , such as f o r c o n s t r u c t i o n or improving the road on h i s p r o p e r t y and b r i n g i n g a water or sewer main i n t o h i s development, are g e n e r a l l y borne by the developer i n any case and do not form p a r t of the impost f e e . Rather, impost fees are assessed to recover those c o s t s which otherwise would be a burden p l a c e d on the e x i s t i n g tax-payers, who i n the absence of such f e e s , would have to c o n t r i b u t e towards the payment f o r b e n e f i t s f o r the new 50 development. These are c o s t s t h a t occur on a f a i r l y l a r g e s c a l e . For example, i t i s the a r t e r i a l roads i n the whole area g e n e r a l l y - sometimes i n the whole m u n i c i p a l i t y - t h a t c o u l d experience a c o n s i d e r a b l e upsurge i n use and a c c e l e r a -ted d e t e r i o r a t i o n caused by new developments, and, f o r which revenue w i l l be r e q u i r e d f o r f u t u r e remedial a c t i o n . T h i s a p p l i e s e q u a l l y to water. An impost fee assessed s p e c i f i -c a l l y f o r improvements to water s e r v i c e s i s not intended to generate revenue to c o n s t r u c t a four i n c h or s i x i n c h water main to the s u b j e c t p r o p e r t y . T h i s i s a c o s t t h a t the developer must assume r e g a r d l e s s of the impost f e e . Rather, the impost fee i s a p p l i e d to d e f r a y the c o s t s of f u t u r e intended improvements to the e n t i r e water system; f o r instance,, to i n s t a l l a major pump which may be n e c e s s i -t a t e d by the a p p l i c a b l e development together w i t h f u t u r e developments. S i m i l a r i l y , s a n i t a r y and storm sewer imposts are t r e a t e d i n a l i k e manner. 4.3 The Impost Fee i n B r i t i s h Columbia -An H i s t o r i c a l Overview (1960-1977): To a l a r g e e x t e n t , the impost fee i n B r i t i s h Columbia i s a r e s u l t of changes i n p u b l i c a t t i t u d e towards p o p u l a t i o n growth. A b r i e f d i s c u s s i o n of these changes i n a t t i t u d e w i l l r e f l e c t the reasons why the impost fee concept was spawned and how i t matured to become common-pla c e i n many m u n i c i p a l i t i e s i n B r i t i s h Columbia. I t was not too many years ago, when the p r e v a i l i n g a t t i t u d e i n B r i t i s h Columbia, among other p l a c e s , was t h a t 51 p o p u l a t i o n growth was a good t h i n g . I t i n s p i r e d confidence i n the p u b l i c and p r i v a t e s e c t o r s because i t s i g n i f i e d a boom i n , or a t l e a s t the w e l l being o f , the economy. I t was a time when wages and p r i c e s were r e l a t i v e l y s t a b l e , and l o c a l p u b l i c investment i n growth was s m a l l . Then, as occurs i n most "boom" l o c a l i t i e s , the e f f e c t s of i n f l a t i o n and o t h e r a s s o c i a t e d r e a l i t i e s , d i s -rupt the seemingly s t a b l e economy. As the new a t t i t u d e s towards growth occur, the p u b l i c and p r i v a t e s e c t o r s soon r e a l i z e the c o s t s of growth (Lane, Centre f o r C o n t i n u i n g Education, 1976). In B r i t i s h Columbia, i n the i n i t i a l stages of urban expansion, l o c a l governments a l s o probably regarded growth i n a f a v o u r a b l e manner, as i t represented an e n l a r g e -ment of t h e i r tax base. But they too soon r e a l i z e d t h a t the cumulative e f f e c t s of i n f l a t i o n , the c o s t s of s e r v i c i n g the new developments, and the r i s i n g a s p i r a t i o n s of t h e i r c o n s t i t u e n t s , c r e a t e d s e r i o u s f i n a n c i a l s t r a i n s on t h e i r sources of revenue. They found t h a t they were r e a c h i n g deeper i n t o t h e i r pockets to accommodate growth. E a r l y i n the 1960's, m u n i c i p a l i t i e s s t a r t e d to look a t s t r a t e g i e s to reduce the impact growth was having on t h e i r revenues. One of the f i r s t s t r a t e g i e s t h a t muni-c i p a l i t i e s i n B r i t i s h Columbia e x p l o r e d was use of t h e i r zoning powers. P r i o r to t h i s p e r i o d , zoning c o n s i s t e d mainly of negative r e g u l a t i o n s which prevented o n l y the most o b j e c t i o n a b l e kinds of development from o c c u r i n g i n the community (Lane, Centre f o r C o n t i n u i n g E d u c a t i o n , 1976), With the changing a t t i t u d e s i n l o c a l government, zoning came to be used more and more to implement s t r a t e g i e s which would accomplish wider community o b j e c t i v e s . In essence, there was an attempt to use zoning to c a r r y out p u b l i c p o l i c y a t the l o c a l l e v e l . As an example, some communities i n B r i t i s h Columbia which were e x p e r i e n c i n g r a p i d p o p u l a t i o n growth r a t e s , began to c o n s i d e r zoning as a method of managing, and i n some cases, d e t e r r i n g growth. The changing a t t i t u d e s a t the l o c a l government l e v e l a l s o r e f l e c t e d i t s e l f i n s u b d i v i s i o n c o n t r o l . P r i o r to the f i s c a l impact of growth p l a y i n g a s e r i o u s r o l e i n m u n i c i p a l f i n a n c e , s u b d i v i s i o n c o n t r o l was mainly used to p r ovide l e g a l access to " p a r c e l s l y i n g beyond". In o t h e r words, i t was l a r g e l y concerned with e n s u r i n g t h a t there was l e g a l access (Lane, Centre f o r C o n t i n u i n g Education, 1976). Subsequently, s u b d i v i s i o n c o n t r o l by-laws, which became more sympathetic towards the m u n i c i p a l i t i e s ' f i n a n c i a l s i t u a t i o n , were d r a f t e d . They began to r e q u i r e n o t a b l y higher standards of s u b d i v i s i o n s e r v i c e s on the p a r t of the developer to o f f s e t the m u n i c i p a l i t i e s ' .cost df p r o v i d i n g these improvements. During t h i s time, many m u n i c i p a l i t i e s r e q u i r e d developers to i n c l u d e curbs and g u t t e r s , underground storm drainage, and paved roads as a c o n d i t i o n of s u b d i v i s i o n a p p r o v a l . Subsequently, i n the Lower Mainland area of B r i t i s h Columbia, the M u n i c i p a l i t y of Richmond brought 53 forward s t i l l another method o f t r a n s f e r r i n g more respon-s i b i l i t i e s f o r the s e r v i c i n g o f new s u b d i v i s i o n s t o the developer. T h i s v e h i c l e has been c a l l e d a development c o n t r a c t and was f i r s t i n t r o d u c e d by W.T. Lane, then the M u n i c i p a l S o l i c i t o r f o r Richmond and now the D i r e c t o r o f Reg i o n a l Development f o r the Greater Vancouver Region a l D i s t r i c t . Since i t s i n t r o d u c t i o n i n the e a r l y 1960's, s e v e r a l other l o c a l i t i e s i n the area, such as the M u n i c i -p a l i t y o f Surrey, had adopted s i m i l a r types o f s t r a t e g i e s . However, the term "development c o n t r a c t " soon became a p p l i e d t o a v a r i e t y , o f agreements used.for a v a r i e t y of purposes; a l l w i t h the common aim of s a v i n g l o c a l tax d o l l a r s . One s o l i c i t o r has claimed t h a t development con-t r a c t s are i l l e g a l and u l t r a v i r e s the m u n i c i p a l i t y ' s power (Wilson, Centre f o r C o n t i n u i n g E d u c a t i o n , 1976), w h i l e another has s t a t e d t h a t these c o n t r a c t s have never been sa n c t i o n e d by l e g i s l a t i o n (MacKenzie, 1978). But LaneVhas s t a t e d t h a t the l e g a l b a s i s of the Richmond v e r s i o n has been misunderstood by many people, i n c l u d i n g some members of the l e g a l p r o f e s s i o n . He contends t h a t the powers r e q u i r e d by a m u n i c i p a l i t y t o en t e r the Richmond v e r s i o n of the agreement are c l e a r l y s e t f o r t h i n v a r i o u s p l a c e s o f the M u n i c i p a l A c t . The .apparent mis-understanding i s t h a t c r i t i c s e r r o n e o u s l y assume t h a t t h i s type of c o n t r a c t i s an attempted e x e r c i s e o f the municipa-l i t y ' s l e g i s l a t i v e or r e g u l a t o r y powers. 54 Due to the f a c t t h a t the M u n i c i p a l Act p r o v i d e s e x p l i c i t d e t a i l s on the p r o v i s i o n of s u b d i v i s o n s e r v i c e s i n S e c t i o n 711 ( 1 ) ( d ) , (e), (f) and (g), many people -i n c l u d i n g some l e g a l p r a c t i o n e r s - have assumed t h a t these enumerated l e g i s l a t i v e powers r e p r e s e n t the onl y a u t h o r i t y f o r a m u n i c i p a l i t y to o b t a i n p u b l i c works from a developer. However, t h i s i s not the case. The method by which the M u n i c i p a l i t y o f Richmond ensured a l l new s u b d i v i s i o n s were f u l l y s e r v i c e d , was through the use of i t s a d m i n i s t r a t i v e or "housekeeping" (not l e g i s -l a t i v e ) powers to enter development c o n t r a c t s w i t h de v e l o p e r s . Lane (Centre f o r Con t i n u i n g Education, 1976) has d e s c r i b e d the development c o n t r a c t as thus: "By development c o n t r a c t s , I mean agreements t h a t are simply entered i n t o by a developer because he wants or needs a c e r t a i n s e r v i c e such as a water main or sewer, and i s a w i l l i n g p a r t y to enter i n t o an agreement i n which he e i t h e r undertakes to pay f o r the works or w i l l , i n f a c t , c o n s t r u c t them s u b j e c t to l o c a l government or r e g i o n a l d i s t r i c t s u p e r v i s i o n . T h i s development c o n t r a c t sometimes a p p l i e d to o n - s i t e works, t h a t i s , the works t h a t are c o n s t r u c t e d w i t h i n the l a n d covered by the proposed s u b d i v i s i o n p l a n ; a l s o , i t sometimes covered works t h a t extended o f f the s i t e o f the s u b d i v i s i o n i n qu e s t i o n . " The M u n i c i p a l i t y o f Richmond was very c a r e f u l not to put i t s e l f i n the p o s i t i o n of being accused of s e l l i n g r i g h t s under i t s l e g i s l a t i v e power. Rather, the M u n i c i p a l i t y adhered to us i n g i t s a d m i n i s t r a t i v e powers as c o n f e r r e d by such s e c t i o n s i n the M u n i c i p a l Act as: 55 1. S e c t i o n 17(1) which s t a t e s t h a t "every m u n i c i p a l i t y . . . has f u l l power to a c q u i r e by purchase, l e a s e , or otherwise and to h o l d r e a l p r o p e r t y . . . and l i k e -wise to a c q u i r e , h o l d , s e l l , or l e a s e p e r s o n a l p r o p e r t y and to c o n t r a c t f o r m a t e r i a l s and s e r v i c e s . " 2. S e c t i o n 247(3) which s t a t e s t h a t "the C o u n c i l may c o n t r a c t f o r the supply of m a t e r i a l s , equipment, and s e r v i c e s , p r o f e s s i o n a l or otherwise, r e q u i r e d f o r the o p e r a t i o n , maintenance and a d m i n i s t r a t i o n of the muni-c i p a l i t y and of m u n i c i p a l p r o p e r t y . " The development c o n t r a c t was used s u c c e s s f u l l y i n Richmond f o r many years to ensure t h a t a l l new sub-d i v i s i o n s were f u l l y s e r v i c e d a t the developer's expense, so t h a t the m u n i c i p a l i t y would not have to i n c u r the c o s t s of p r o v i d i n g these improvements. By u t i l i z i n g the above noted c l a u s e s to e x e r c i s e i t s "housekeeping" powers, Richmond was able to enter development agreements w i t h developers and c o n t r a c t to have them pr o v i d e c e r t a i n sub-d i v i s i o n s e r v i c e s (or money i n l i e u of these s e r v i c e s ) t h a t i t c o u l d not i n s i s t upon when i t was simply l e g i s l a -t i n g . (A more e x p l i c i t d e s c r i p t i o n of the mechanics and procedure i n v o l v e d i n b r i n g i n g about development c o n t r a c t s i s i n c l u d e d i n Appendix 3, as quoted by Lane.) As was mentioned e a r l i e r , s i m i l a r type s t r a t e g i e s were used by other m u n i c i p a l i t i e s to accomplish the same g o a l . The M u n i c i p a l i t y of Surrey i s a case i n p o i n t . I t a l s o u t i l i z e d the development c o n t r a c t technique, but w i t h 56 a s l i g h t l y d i f f e r e n t approach. A d e s c r i p t i o n of the methodology employed by t h i s l o c a l i t y has been i n c l u d e d as Appendix 4, as quoted by B. P o r t e r . Unbeknown to many l o c a l i t i e s , the development c o n t r a c t - which was i n i t i a t e d i n Richmond more than 15 years ago - i s s t i l l a p p l i c a b l e to the development and s u b d i v i s i o n approval process today. Consequently, t h i s agreement c o u l d s t i l l be used to a c q u i r e c e r t a i n c o n s i d e r a -t i o n from developers i n the event t h a t a l t e r n a t e methods are not a p p l i c a b l e (or a v a i l a b l e ) . In the mid 1960's, as the c o s t of p u b l i c s e r v i c e s i n c r e a s e d and as the i n f l a t i o n surged on, more and more f r e q u e n t l y the m u n i c i p a l i t i e s looked to the developer to p r o v i d e a d d i t i o n a l c o s t l y items to reduce o r , a t l e a s t , maintain t h e i r l e v e l of e x p e n d i t u r e s . Using the development c o n t r a c t v e h i c l e , m u n i c i p a l i t i e s began to r e q u i r e developers to p r o v i d e l a n d f o r schools and parks i n and around t h e i r s u b d i v i s i o n s and, i n some cases, money i n l i e u of l a n d . F i n a l l y , m u n i c i p a l i t i e s began t o ' r e q u i r e c o s t s of f u t u r e intended improvements to m u n i c i p a l s e r v i c e s , o r , as p r e -v i o u s l y d e s c r i b e d , impost f e e s . In the e a r l y 1970's the p r o v i n c i a l government began to show some sympathy towards the f i n a n c i a l p l i g h t of m u n i c i p a l i t i e s and i n t r o d u c e d some new l e g i s l a t i o n i n an attempt to a i d t h e i r f i s c a l concerns. I t was i n the e a r l y 1970's t h a t the f i r s t round of development permit l e g i s l a t i o n was i n t r o d u c e d to the M u n i c i p a l A c t . However, \ 57 these permits d i d not r e c e i v e much support from the muni-c i p a l i t i e s , mainly because a t t h a t time, the M u n i c i p a l Act r e q u i r e d t h a t m u n i c i p a l i t i e s must f i r s t adopt an o f f i c i a l community pl a n and r e c e i v e p r o v i n c i a l r a t i f i c a t i o n of same. As many m u n i c i p a l i t i e s f e l t t h a t these r e q u i r e -ments were an i n f r i n g e m e n t on t h e i r autonomy i n l a n d use c o n t r o l s , very few used t h i s permit system. A f t e r l e s s than two years, these development permits were e l i m i n a t e d from the Act and subsequently r e p l a c e d by the l a n d use c o n t r a c t p r o v i s i o n . I t was f i r s t used by W.T. Lane (MacKenzie, 1978). The land use c o n t r a c t p r o v i s i o n of the M u n i c i p a l Act allowed more f l e x i b i l i t y i n the p l a n n i n g process than c o n v e n t i o n a l zoning. But the land use c o n t r a c t , simply by the wide l e g a l meaning of the terminology, allowed even more. The l a n d use c o n t r a c t p r o v i s i o n s empowered the muni-c i p a l i t i e s to enter the realm of c o n t r a c t u a l agreements f o r matters r e l a t i n g to l a n d use, and i n other regards i s s i m i l a r to development c o n t r a c t s . Although m u n i c i p a l i t i e s c o u l d not enter i n t o l a n d use c o n t r a c t s as e a s i l y as development c o n t r a c t s - s i n c e the m u n i c i p a l i t i e s would be u s i n g t h e i r l e g i s l a t i v e powers i n t h i s regard and were thus bound by the c o n d i t i o n s of the r e g u l a t o r y by-law - when per m i t t e d to do so, the c o n t r a c t c o u l d " c o n t a i n such terms and c o n d i t i o n s f o r the use and development of land as may be mutually agreed upon" (Municipal Act, S e c t i o n 702, Subsection 3). V i r t u a l l y anything t h a t c o u l d be n e g o t i a t e d with the developer c o u l d be put i n t o such a c o n t r a c t . 58 The land use contracts, of course, were used by the municipalities - among other equally important purposes - to ensure the provision of on-site and o f f - s i t e services, as well as public open' space at l i t t l e or no expense to them. In addition, i t provided a l e g a l means, sanctioned by the p r o v i n c i a l government, to impose impost fees. From i t s inception, the land use. contract was used extensively by municipalities i n B r i t i s h Columbia (Porter, Centre for Continuing Education, 1976). However, in 1977, another change of attitude occurred at the pro-v i n c i a l government l e v e l , leading to the demise of t h i s instrument. This was the year that B i l l 42 was introduced i n the Legislature and subsequently r a t i f i e d . B i l l 42 cancelled the land use contract provisions of the Municipal Act at a date to be fixed by Proclamation (the f i n a l date was January 16, 1979) and replaced i t with a second set of development permits. It would appear that the p r o v i n c i a l government's objective of t h i s l e g i s l a t i o n was to return the municipalities to a regulatory role, again, as opposed to the previous tendency of sanctioning municipalities to conduct contractual negotiations. By removing land, use contracts, the p r o v i n c i a l government e f f e c t i v e l y negated the m u n i c i p a l i t i e s ' use of t h i s vehicle to acquire impost fees. However, a new i n s t r u -ment was created by B i l l 42 as a substitute for t h i s means of revenue generation. The new instrument i s c a l l e d a development cost charge. 59 As t h i s new form of m u n i c i p a l t a x a t i o n b r i n g s us up to date i n a h i s t o r i c a l p e r s p e c t i v e , i t i s important at t h i s time to t u r n a t t e n t i o n to the impost fee as i t e x i s t e d p r i o r to t h i s l e g i s l a t i o n . The f o l l o w i n g s e c t i o n w i l l d e t a i l the extent of use of the impost fee i n B r i t i s h Columbia i n 19 77. Information r e l a t i n g to development c o s t charges w i l l be r e s e r v e d f o r the f o l l o w i n g chapter. 4.4 A Survey of the Impost Fee i n B r i t i s h Columbia (1977): P r i o r to B i l l 42, there appears to have been three d i s t i n c t types of impost fees i n B r i t i s h Columbia: 1. Those which were designated f o r a s p e c i f i c purpose, as d e t a i l e d i n S e c t i o n 711 of the M u n i c i p a l Act, and t h e r e f o r e stand i n l i e u of the developer's r e s p o n s i -b i l i t y f o r s e r v i c e i n s t a l l a t i o n s . 2. Those which were l e v i e d on the grounds of another s t a t e d m u n i c i p a l need, such as f o r p a r k l a n d a c q u i s i t i o n . 3. Those which were imposed f o r an u n s p e c i f i e d purpose. The l a t t e r type of impost should a l s o i n c l u d e those which were s p e c i f i e d f o r nebulous purposes, such as "general improvements" or " c a p i t a l improvements". P r i o r to the most r e c e n t l e g i s l a t i v e amendments to the M u n i c i p a l Act, what the impost fee p a i d f o r and how i t was a p p l i e d v a r i e d from m u n i c i p a l i t y to m u n i c i p a l i t y , and u n t i l r e c e n t l y no degree of s t a n d a r d i z a t i o n had e v o l v e d . T h i s was mainly due to the f a c t t h a t there had been no p r o v i n c i a l l e g i s l a t i o n d e a l i n g e x p l i c i t l y with impost fees 60 and, consequently, c o u n c i l s were l e f t to decide independently how these charges were to be a p p l i e d . From the i n t e r v i e w s which were conducted, i t would appear t h a t the main c r i t e r i a which were used to determine the r a t e s t r u c t u r e and the method of a p p l i c a t i o n were the m u n i c i p a l i t i e s ' f i n a n c i a l needs and c o n v i c t i o n s towards development. T h i s would account f o r the wide v a r i a t i o n s i n both the r a t e s and the implementation s t r a t e g i e s . A review of the survey r e s u l t s w i l l show these v a r i a t i o n s . Methodology of Survey: On January 30, 1977, a q u e s t i o n n a i r e ( a copy of which i s i n c l u d e d i n Appendix 1) was sent to 36 l o c a l i t i e s i n B r i t i s h Columbia. The o b j e c t i v e of the survey was to inv e n t o r y the c u r r e n t use of the impost fee a t t h a t time. The q u e s t i o n n a i r e requested i n f o r m a t i o n on the l e v e l s o f imposts by type of development and land use, the s p e c i f i c purposes of the impost, the means of implementation and problems encountered i n i t s use. Se v e r a l c r i t e r i a were used as a b a s i s f o r choosing the l o c a l i t i e s i n which the survey was to be conducted. F i r s t l y , i t was decided at the o u t s e t t h a t the sample should be r e s t r i c t e d to those areas e x p e r i e n c i n g a c o n s i d e r a b l e volume of r e s i d e n t i a l growth. Secondly, i t was a l s o decided t h a t the sample communities had to be l a r g e enough i n both s i z e and p o p u l a t i o n to warrant the use of the impost fee concept. As a r e s u l t of these c r i t e r i a , 36 l o c a l i t i e s 61 were chosen from the 1971 Census. Each of these communities - 18 c i t i e s and 18 m u n i c i p a l d i s t r i c t s - had experienced growth r a t e s exceeding 100% between 1950 and 1970 and had a p o p u l a t i o n of a t l e a s t 10,000 persons (according to the 1971 Census). The names of these l o c a l i t i e s and the dates of t h e i r response are l i s t e d i n Appendix 5. Res u l t s of the Survey: As of March 22, 1977, 25 of the 36 survey l o c a -l i t i e s , or 69 per cent, had submitted responses to the q u e s t i o n n a i r e . The remaining 11 l o c a l i t i e s , which d i d not respond to the survey, were telephoned on March,2 and 3, 1977, i n order t h a t a 100 per cent sample c o u l d be achieved. The r e s u l t s of the survey f o l l o w : * Of the 36 survey l o c a l i t i e s , 21 or s l i g h t l y more than 5 8 per cent - 10 c i t i e s and 11 m u n i c i p a l d i s t r i c t s - l e v i e d imposts on r e s i d e n t i a l developments. Table 4 r e p r e s e n t s a l i s t o f the c i t i e s which had adopted the concept and the amount of imposts l e v i e d i n each l o c a l i t y . S i m i -l a r l y , Table 5 r e p r e s e n t s a l i s t of m u n i c i p a l d i s t r i c t s i n B r i t i s h Columbia which used impost f e e s . * In the 10 sample c i t i e s which had adopted the impost f e e , the amount o f l e v y i n r e s p e c t to s i n g l e f a m i l y d w e l l i n g s and duplexes, ranged from $0 to $2,205 per u n i t . Using those c i t i e s which had s t a t e d s p e c i f i c impost f i g u r e s , the average impost fee f o r s i n g l e f a m i l y d w e l l i n g s and duplexes was computed to be approximately $1,000 per u n i t . 62 TABLE 4 THE AMOUNTS OF IMPOST FEES BY TYPES OF DWELLING UNITS IN THE CITIES OF BRITISH COLUMBIA AS OF MARCH 3, 1977 Types of Res iden t i a l Devel opment (per 1 i v i n g u n i t or a d d i t i o n a l l o t created) S i n g l e Family M u l t i p l e C i t y D welling Duplex Density Cranbrook $1, 300/acre $1, 300/acre $1, 300/acre Kamloops $2, 130/unit $2, 130/unit $1, 850/unit Kelowna Refer to Appen dix 6 Langley $1, 555 - $1, 555 - $1, 150 -$2, 205/unit $2, 205/unit $2, 800/unit Nanaimo Refer to Appen flix 6 North Vancouver $ 50/unit $ 50/unit $ 5 0/unit P e n t i c t o n $1, 700 or $1, 700 or $1, 700 o r $1, 930/unit $1, 930/unit $1, 930/unit P o r t Coquitlam $1, 100/unit $1, 100/unit $1, 100/unit Vernon $ 800/unit $ 800/unit $ 600/unit White Rock n i l n i l $1, 500/unit 63 TABLE 5 THE AMOUNTS OF IMPOST FEES BY TYPES OF DWELLING UNITS IN THE MUNICIPAL DISTRICTS IN BRITISH COLUMBIA AS OF MARCH 3, 1977 Mu n i c i p a l D i s t r i c t Types of R e s i d e n t i a l Development (per l i v i n g u n i t o r a d d i t i o n a l l o t created) S i n g l e Family Dwelling Duplex M u l t i p l e Density Burnaby C h i l l i w a c k Coquitlam D e l t a Langley Maple Ridge Matsqui M i s s i o n Richmond Surrey West Vancouver $ 521/unit $ 521/unit Refer to Appendix 6 $ 600/unit $1,000/unit $ 600 -$1,600/unit $1,000/unit $ 600/unit $1,000/unit $1,600/unit $ l , 1 0 0 / u n i t Refer to Appendix 6 I Refer to Appendix 6 $2,700/unit $1,415 -$2,205/unit $2,700/unit $1,555 -$2,205/unit Refer to Appendix 6 I Refer to Appendix 6 $ 600/unit $1,000/unit $1,600/unit Refer to Appendix 6 $2,700/unit $1,945 -$2,595/unit 64 Using the same methodology f o r m u n i c i p a l d i s t r i c t s , the imposts v a r i e d from $521 to $2,205 per u n i t , r e s u l t i n g i n an average fee of approximately $1,25 0 per u n i t . * In the c i t i e s , the impost fee f o r m u l t i p l e d e n s i t y u n i t s ranged from $50 per u n i t to $2,800 per u n i t . Using the f i g u r e s which were gi v e n , the average fee f o r m u l t i p l e d e n s i t y was computed to be approximately $1,100 per u n i t . In m u n i c i p a l d i s t r i c t s , the fee v a r i e d from $600 to $2,595, r e s u l t i n g i n an average fee of approximately $1,650 per u n i t . * The average impost fee f o r s i n g l e f a m i l y d w e l l i n g s and duplexes, t a k i n g i n t o c o n s i d e r a t i o n the fee . s t r u c t u r e f o r both c i t i e s and m u n i c i p a l d i s t r i c t s , was s l i g h t l y more than $1,100 per u n i t ($1,112). S i m i l a r i l y , the average impost f o r m u l t i p l e d e n s i t y u n i t s was $1,4 04 per u n i t . * Of the 15 surveyed l o c a l i t i e s which d i d not l e v y impost fees a t the time of the q u e s t i o n n a i r e , f o u r l o c a l i t i e s or 27 per cent, were c o n s i d e r i n g i t s adoption, or a t l e a s t , i n v e s t i g a t i n g whether t h i s concept was a p p l i c a b l e to t h e i r s p e c i f i c needs. These l o c a l i t i e s were: the C i t y o f P r i n c e George, the C i t y o f New Westminster, the D i s t r i c t of Powell R i v e r , and the D i s t r i c t of T e r r a c e . * Twelve of the 21 l o c a l i t i e s which had adopted the impost fee concept responded to the q u e s t i o n r e q u e s t i n g i n f o r m a t i o n on the implementation problems. Of the 12 t h a t 65 responded, e i g h t or 67 per cent s t a t e d t h a t they had not experienced any problems. The remaining 3 3 per cent, or four l o c a l i t i e s , expressed s i m i l a r concerns - each had encountered i n i t i a l r e s i s t e n c e from developers. However, i n most cases, the respondents s t a t e d t h a t the r e s i s t e n c e was minimized as the concept became accepted as r e g u l a r p r a c t i c e . The remaining survey responses are d i s c u s s e d i n g r e a t e r d e t a i l i n Appendix 6. In p a r t i c u l a r , Appendix 6 deals w i t h the impost fee apportionment and the means of implementation i n each l o c a l i t y , i n 1977. A n a l y s i s of Survey R e s u l t s : P r i o r to B i l l 42, many m u n i c i p a l a u t h o r i t i e s i n B r i t i s h Columbia were questioned on the l e g a l i t y o f t h e i r implementation techniques with r e s p e c t to impost f e e s ; and a l s o , were s t r o n g l y c r i t i c i z e d f o r the l a r g e amounts of imposts which were being l e v i e d (Dick, C o n t i n u i n g L e g a l Education S o c i e t y of B r i t i s h Columbia, 1979).' Reviewing the i n f o r m a t i o n presented i n t h i s s e c t i o n o f the study and Appendix 6, with r e s p e c t to both these a s p e c t s , i t would appear t h a t some l o c a l i t i e s may have a t t r a c t e d v a l i d c r i t i -cisms. However, i t i s very d i f f i c u l t to p o i n t an a c c u s i n g f i n g e r a t any p a r t i c u l a r m u n i c i p a l i t y f o r abusing the use of impost fees." In f a i r n e s s to m u n i c i p a l i t i e s , i t should be s t a t e d t h a t i n most cases, they were motivated by genuine attempt to p r o t e c t t h e i r e x i s t i n g taxpayers from the c o s t 66 burdens of o f f - s i t e f a c i l i t i e s to serve new development and t h e r e f o r e chose implementation s t r a t e g i e s and amounts of imposts to s u i t t h e i r p a r t i c u l a r circumstance and need (Dick, C o n t i n u i n g Legal Education S o c i e t y of B r i t i s h Columbia, 1979). The L e g a l i t i e s of the Impost Fee: Reviewing the implementation s t r a t e g i e s which v a r i o u s m u n i c i p a l i t i e s u t i l i z e d , i t would appear t h a t some of these l o c a l i t i e s were pushing the extremes of t h e i r l e g a l c a p a b i l i t y and thus had a t t r a c t e d v a l i d c l a ims from developers o f being u l t r a v i r e s . However, s i n c e most developers r e q u i r e the a d m i n i s t r a t i v e c o - o p e r a t i o n o f the m u n i c i p a l i t i e s to b r i n g about a development, they were f r e q u e n t l y w i l l i n g to co-operate (Wilson, Centre f o r Con-t i n u i n g E d u cation, 1976). T h i s i s probably one of the major reasons why there were few c o u r t a c t i o n s taken a g a i n s t the m u n i c i p a l i t i e s which were imposing imposts under dubious l e g a l a u s p i c e s . As was s t a t e d a t the beginning of t h i s study, there has been l i t t l e i n f o r m a t i o n which has been documented on impost f e e s , and from t h i s l a c k of m a t e r i a l , i t i s very d i f f i c u l t to a s c e r t a i n the l e g a l i t i e s o f the v a r i o u s t e c h -niques used to impose t h i s f e e . However, i t would appear t h a t the land use c o n t r a c t p r o v i s i o n of the M u n i c i p a l Act and the development c o n t r a c t technique were the o n l y means sanctioned by the p r o v i n c i a l l e g i s l a t u r e through which these 67 fees c o u l d be a c q u i r e d . I t i s q u i t e c l e a r from the v a r i o u s p r o v i s i o n s o f the Act t h a t whatever terms and c o n d i t i o n s a m u n i c i p a l i t y had agreed upon i n the two types o f c o n t r a c t s , the use of imposts was p e r m i t t e d , i f the developer agreed and executed the c o n t r a c t . When the developer executed h i s c o n t r a c t and brought i t back to the m u n i c i p a l i t y , i t was, i n e f f e c t , a p r o p o s a l by the developer to develop the land i n the way proposed by the c o n t r a c t , and to pay the impost (Lane, Centre f o r C o n t i n u i n g Education, 1976). A review of the r e s u l t s from the survey show t h a t some l o c a l i t i e s requested imposts as a c o n d i t i o n of s u b d i v i s i o n or rezon i n g a p p r o v a l , or a l t e r n a t i v e l y , had purposely w i t h h e l d the issuance of b u i l d i n g permits pending the tender of imposts. These methods would appear to have been unlawful and would on l y be v a l i d as long as people d i d not at t a c k them j u d i c i a l l y . There never has been any cl a u s e i n the M u n i c i p a l Act or oth e r a p p l i c a b l e a c t , per-t a i n i n g to s u b d i v i s i o n a p p r o v a l , r e z o n i n g approval or issuance of b u i l d i n g p e r m i t s , which would permit m u n i c i p a l i -t i e s to a c q u i r e imposts s o l e l y by these means. To do so i n the former cases - namely through the s u b d i v i s i o n or rez o n i n g techniques - c o u l d be l e g a l l y conceived to be a method of s e l l i n g zoning o r s u b d i v i s i o n a p p r o v a l ; a t the very l e a s t , i t c o u l d be c o n s i d e r e d an a c t of bad f a i t h on the p a r t of the m u n i c i p a l i t y . M u n i c i p a l i t i e s t h a t used the l a t t e r technique ( i . e . , w i t h h o l d i n g b u i l d i n g permits) ran the r i s k of being v u l n e r a b l e to c o u r t a c t i o n i n the form of w r i t s of mandamus. The onl y means these three techniques 68 cou l d have been used l e g a l l y , was to apply them i n the context of the land use c o n t r a c t or development c o n t r a c t . Using these v e h i c l e s , the m u n i c i p a l i t y c o u l d have c o n t r a c t e d with the developer to have him tender the imposts as a con-d i t i o n o f e i t h e r s u b d i v i s i o n or re z o n i n g approval or as a c o n d i t i o n of b u i l d i n g permit i s s u a n c e . There has been an i n t e r e s t i n g case i n the B r i t i s h Columbia Supreme Court d e a l i n g s p e c i f i c a l l y w i t h the imposi-t i o n of impost fees as a c o n d i t i o n o f s u b d i v i s i o n a p p r o v a l . The case, G. Gordon F o s t e r Developments L t d . , v. Township of Langley, (1977) 81 D.L.R. (3d), was heard by J u s t i c e J . Bouck. In t h i s case, the p l a i n t i f f was seeking a d e c l a r a t o r y order t h a t the M u n i c i p a l i t y was u l t r a v i r e s f o r r e q u i r i n g i n advance some of i t s f u t u r e c o s t s ( i . e . , $38,400 based on $1,600 per l o t f o r a proposed s u b d i v i s i o n c o n t a i n i n g 24 l o t s ) - f o r m a i n t a i n i n g and improving the s e r v i c e s a f f e c t i n g the area i n q u e s t i o n - as a c o n d i t i o n of s u b d i v i s i o n a p p r o v a l . In h i s d e c i s i o n , J u s t i c e J . Bouck h e l d t h a t there was no a u t h o r i t y i n the M u n i c i p a l Act or elsewhere f o r such a requirement, which was a c c o r d i n g l y d e c l a r e d u l t r a v i r e s of the p a r t i c u l a r m u n i c i p a l i t y . He s t a t e d t h a t , "Langley should not be allowed to r e t a i n the p l a i n t i f f ' s $38,400 si n c e i t was e x t r a c t e d from the p l a i n t i f f through an ( i l l e g a l d e v i c e ) " . The Impost Fee Rate S t r u c t u r e : From the m u n i c i p a l s t a n d p o i n t , the impost fee 69 was a d i r e c t response to the l o c a l f i n a n c i a l s t r a i n s which were caused by the demands f o r s e r v i c e s c r e a t e d by new developments. Consequently, those m u n i c i p a l i t i e s which had adopted the impost fee concept had attempted to recover a p o r t i o n or a l l , or i n some cases, p o s s i b l y even more of the r e q u i r e d revenues to f a c i l i t a t e the s e r v i c i n g r e q u i r e -ments. These l o c a l i t i e s had e s t a b l i s h e d a r a t e s t r u c t u r e and an implementation s t r a t e g y which r e f l e c t e d t h e i r f i n a n c i a l needs and c o n v i c t i o n s . From the developers' and the p u b l i c ' s s t a n d p o i n t , the m a j o r i t y of c r i t i c i s m s had centered on how much new developments should be r e q u i r e d to pay i n the form of impost fees (Dick, C o n t i n u i n g L e g a l Education S o c i e t y of B r i t i s h Columbia, 1979). Developers had argued t h a t by s e t t i n g the charges so hig h , some l o c a l i t i e s were r e s t r i c -t i n g development. At the very l e a s t , some m u n i c i p a l i t i e s were accused of i n c r e a s i n g the c o s t of housing at a time when there was a s h o r t supply of housing f o r low and moderate income groups ( J a n i s , 1975). Although the i s s u e s d e s c r i b e d above are concerned with the amounts t h a t should be charged to new developments, i t should have been understood t h a t , due to the l a c k of guidance, the m u n i c i p a l i t i e s had assumed the r e s p o n s i b i l i t y to e s t a b l i s h t h e i r own r a t e s t r u c t u r e s and d i d so i n cog-nizance of the l o c a l s i t u a t i o n . T h i s r a i s e s the s e r i o u s q u e s t i o n concerning the s h a r i n g of p u b l i c s e r v i c e c o s t s between new and e x i s t i n g developments. I t i s c l e a r t h a t 70 other c r i t e r i a b e s i d e s l o c a l needs and c o n v i c t i o n s should have been, and s t i l l should be, analyzed and taken i n t o c o n s i d e r a t i o n when dev e l o p i n g a r a t e s t r u c t u r e . At the very l e a s t , a r a t e s t r u c t u r e should be based on the p h i l o s o -phies o f : adequacy ( i . e . , to ensure t h a t the r e q u i r e d revenues w i l l be re c o v e r e d ) ; e q u i t y ( i . e . , to ensure t h a t a l l users pay i n p r o p o r t i o n to the b e n e f i t s they w i l l r e c e i v e ) ; and p r a c t i c a b i l i t y ( i . e . , to ensure t h a t the r a t e s p r o v i d e good value and, to some exten t , compare reasonably with the r a t e s i n ot h e r areas) (American P u b l i c Works A s s o c i a t i o n , e t . a l . , 1973). As a minimum, to ensure adequacy, e q u i t y and p r a c t i c a b i l i t y i n the treatment of new developments, those l o c a l i t i e s which had adopted the impost fee concept should have c l e a r l y e s t a b l i s h e d p o l i c i e s on: 1. the s e r v i c e l e v e l s f o r a l l areas w i t h i n t h e i r j u r i s -d i c t i o n , thus i d e n t i f y i n g the d i f f e r e n c e s between the f i n a n c i a l requirements o f the developed areas and the requirements of the areas to be developed; and, 2. the f i n a n c i n g plans f o r both types of areas. Once the s e r v i c i n g l e v e l s have been e s t a b l i s h e d and the impost fee concept i s determined to be the means of f i n a n c i n g the s e r v i c i n g requirements of the developing area, then and o n l y then should a fee s t r u c t u r e be c a l -c u l a t e d . 71 4.5 Summary and C o n c l u s i o n s : The many f i n a n c i a l problems encountered by l o c a l governing a u t h o r i t i e s have caused the c i t i e s and m u n i c i p a l d i s t r i c t s i n the pro v i n c e to r e - e v a l u a t e t h e i r f i s c a l r e s p o n s i b i l i t i e s and search f o r a l t e r n a t i v e means of pro-v i d i n g m u n i c i p a l s e r v i c e s . The impost fee - which was designed to de f r a y the m u n i c i p a l c o s t s o f p r o v i d i n g s e r v i c e s to new development areas - was one means t h a t was popular among many m u n i c i p a l i t i e s i n the 1960's and the e a r l i e r h a l f o f the 1970's. To a c e r t a i n e x t e n t , the impost fee concept evolved as a r e s u l t o f changes i n a t t i t u d e towards p o p u l a t i o n growth. I t was a c u l m i n a t i o n o f v a r i o u s m u n i c i p a l s t r a t e g i e s - such as the use of zoning to manage growth, and the use of sub-d i v i s i o n c o n t r o l by-laws to r e q u i r e developers to pr o v i d e h i g h e r standards o f s u b d i v i s i o n s e r v i c e s - to o f f s e t the f i n a n c i a l i m p l i c a t i o n s a s s o c i a t e d w i t h growth. In keeping with these s t r a t e g i e s , the impost concept was developed with the b a s i c i n t e n t o f meeting the demand f o r new and improved s e r v i c e s by imposing a f i n a n c i a l requirement on those lands t h a t c r e a t e the demand. The impost fee was f i r s t i n t r o d u c e d i n t o the prov i n c e by the M u n i c i p a l i t y of Richmond i n the e a r l y 1960's. At t h i s time, the impost was a c q u i r e d through a development c o n t r a c t , whereby a w i l l i n g developer c o n t r a c t e d to pay the impost f o r some form of m u n i c i p a l c o n s i d e r a t i o n . Although the development c o n t r a c t has been misunderstood 72 by many people, who have e r r o n e o u s l y assumed t h i s type of agreement to be u l t r a v i r e s the m u n i c i p a l i t i e s ' powers, the powers r e q u i r e d by a m u n i c i p a l i t y to e n t e r t h i s c o n t r a c t i s c l e a r l y s e t f o r t h i n a v a r i e t y of p l a c e s i n the M u n i c i p a l Act, The apparent misunderstanding i s t h a t , the c r i t i c s have assumed t h i s type of c o n t r a c t to be an e x e r c i s e i n the m u n i c i p a l i t i e s ' l e g i s l a t i v e powers, which i t i s not. Rather, the M u n i c i p a l i t y of Richmond - and other l o c a l i t i e s which subsequently f o l l o w e d the Richmond example - s p e c i f i -c a l l y r e l i e d on i t s a d m i n i s t r a t i v e powers to e n t e r the con-t r a c t u a l agreement. By u s i n g i s a d m i n i s t r a t i v e power, Richmond, and other l o c a l i t i e s , were able to e n t e r develop-ment agreements with developers and c o n t r a c t to have developers provide c e r t a i n s u b d i v i s i o n s e r v i c e s (or money i n l i e u of these s e r v i c e s ) t h a t they c o u l d not i n s i s t upon when they were simply u s i n g t h e i r l e g i s l a t i v e powers. The development c o n t r a c t technique, which i s s t i l l a p p l i c a b l e to the development and s u b d i v i s i o n approval process today, pla y e d a s i g n i f i c a n t r o l e , i n the 1960's, i n the m u n i c i p a l attempt to reduce the f i n a n c i a l impact of growth. In the f i r s t h a l f of the 1970's, the impost fee concept became more prominent among B r i t i s h Columbia muni-c i p a l i t i e s . T h i s was mainly due to the i n c l u s i o n of the land use c o n t r a c t p r o v i s i o n i n the M u n i c i p a l Act. T h i s p r o v i s i o n , s i m i l a r to the p r e v i o u s l y mentioned s e c t i o n s i n the M u n i c i p a l Act p e r t a i n i n g to development c o n t r a c t s , empowered m u n i c i p a l i t i e s to e n t e r the realm of c o n t r a c t u a l n e g o t i a t i o n f o r matters r e l a t i n g to l a n d use. As the l a n d 73 use c o n t r a c t c o u l d c o n t a i n such terms and c o n d i t i o n s f o r use and development of land as may be mutually agreed upon, i t o f f e r e d the m u n i c i p a l i t i e s the l e g i s l a t i v e powers to ac q u i r e impost fees and other c o n s i d e r a t i o n s from developers, under c e r t a i n c o n d i t i o n s which were s t i p u l a t e d i n the Act. Many m u n i c i p a l i t i e s took advantage of the land use c o n t r a c t p r o v i s i o n to impose impost f e e s . A survey conducted i n February and March of 1977 r e v e a l e d t h a t of the 36 l o c a l i t i e s which were surveyed, 21 or 58 per cent of these l o c a l i t i e s had adopted the impost fee concept. The amount of the impost f e e , f o r s p e c i f i c types o f develop-ments, v a r i e d widely from community to community. As an example, the amount of l e v y i n r e s p e c t to s i n g l e f a m i l y d w e l l i n g s and duplexes ranged from $0 i n one community to $2,205 i n another. I t i s b e l i e v e d t h a t r e g i o n a l d i f f e r e n c e s i n s e r v i c i n g c o s t s and the v a r i a t i o n i n m u n i c i p a l f i n a n c i a l needs and c o n v i c t i o n s c o n t r i b u t e d , to some extent , to t h i s wide range. The l a c k of guidance, d i r e c t i o n and l e g i s l a t i o n from the p r o v i n c i a l l e g i s l a t u r e was a l s o an e q u a l l y important c o n t r i b u t o r . At the time of the survey, m u n i c i p a l i t i e s were imposing impost fees through a v a r i e t y of implementation s t r a t e g i e s . Although most communities r e l i e d , to some ext e n t , on the l a n d use c o n t r a c t or the development c o n t r a c t techniques to acq u i r e imposts i n t r a v i r e s , some l o c a l i t i e s used other methods which are of dubious l e g a l s t a t u s . In regard to the l a t t e r , some l o c a l i t i e s were a c q u i r i n g imposts 74 s o l e l y as a c o n d i t i o n of s u b d i v i s i o n or re z o n i n g approval or as a c o n d i t i o n o f i s s u i n g a b u i l d i n g permit. As there was no l e g i s l a t i o n a l l o w i n g m u n i c i p a l i t i e s to a c q u i r e fees i n t h i s manner, i f j u d i c i a l l y questioned, they c o u l d have been c o n s i d e r e d u l t r a v i r e s . I t i s f e l t t h a t the impost fee c o u l d o n l y be l e g a l l y a c q u i r e d through a l a n d use or development c o n t r a c t . 1977 was a year i n which s i g n i f i c a n t changes oc c u r r e d w i t h r e s p e c t to the land use c o n t r a c t and impost fee . T h i s was the year t h a t " B i l l 42" was i n t r o d u c e d i n t o the L e g i s l a t u r e and subsequently r a t i f i e d . In essence, t h i s B i l l , among other t h i n g s , r e p e a l e d the land use c o n t r a c t p r o v i s i o n s o f the M u n i c i p a l Act and purported to a b o l i s h impost f e e s . The new amendment r e p l a c e d these w i t h the development permit system and development c o s t charges. As w i l l be r e f l e c t e d i n the f o l l o w i n g chapter, t h i s l e g i s -l a t i o n r e p r e s e n t s a major change i n the m u n i c i p a l r o l e i n land use c o n t r o l and m u n i c i p a l f i n a n c e . 75 CHAPTER FIVE RECENT LEGISLATIVE AMENDMENTS AFFECTING THE IMPOST FEE 5.1 I n t r o d u c t i o n : The year 1977 has been one of the most s i g n i f i -cant years i n the l a s t decade f o r l e g i s l a t i v e i n n o v a t i o n i n the f i e l d o f lan d use c o n t r o l and m u n i c i p a l f i n a n c e i n B r i t i s h Columbia. T h i s was the year i n which the M u n i c i p a l Amendment Act (1977), commonly r e f e r r e d to as " B i l l 42", changed the m u n i c i p a l i t i e s ' r o l e i n land use and development c o n t r o l and c r e a t e d a new form of m u n i c i -p a l t a x a t i o n . As p r e v i o u s l y mentioned, the M u n i c i p a l A c t was amended to i n t r o d u c e development permits and develop-ment c o s t charges. A development permit i s a zoning based, land use c o n t r o l device which a m u n i c i p a l i t y or a r e g i o n a l d i s t r i c t may employ to r e g u l a t e the q u a l i t y of development i n s p e c i a l s i t u a t i o n s . I t r e p l a c e d the lan d use c o n t r a c t p r o v i s i o n s , which were removed from the M u n i c i p a l A c t, on January 16, 1979. A development c o s t charge i s a fee which a l o c a l o r r e g i o n a l government may impose upon a developer to help cover the c o s t of s e r v i c e s b e n e f i t t i n g a development. T h i s instrument was c r e a t e d as a s u b s t i -t u t i o n f o r the p u r p o r t e d l y a b o l i s h e d impost f e e . T h i s chapter w i l l d e a l s p e c i f i c a l l y with the l e g i s l a t i v e amendment mentioned above. In p a r t i c u l a r , t h i s chapter w i l l concentrate predominantly on the develop-ment c o s t charge p r o v i s i o n . T h i s chapter w i l l begin with 76 a g e n e r a l d i s c u s s i o n of the background i n f o r m a t i o n r e l e v a n t to B i l l 42, then p r o v i d e some survey s t a t i s t i c s on develop-ment c o s t charges, and f i n a l l y , p resent some of the major i m p l i c a t i o n s r e l e v a n t to i t s use. 5.2 " B i l l 42" - An H i s t o r i c a l Overview: To a l a r g e e x t e n t , B i l l 42 - the M u n i c i p a l Amend-ment Act, 19 77 - was the most r e c e n t r e s u l t of the s o - c a l l e d "housing c r i s i s " , which reached the p u b l i c f o r e f r o n t about the e a r l y to mid-60's, i n a l a r g e number of m u n i c i p a l i t i e s i n B r i t i s h Columbia. Although t h i s term has been r e f e r r e d to as being euphamistic and over-exaggerated by some (Pennance, 1976), the gen e r a l p u b l i c has u s u a l l y deemed i t to be of major concern and importance i n i t s everyday l i f e . The housing c r i s i s has been p e r c e i v e d by the p u b l i c to c o n s i s t o f two separate but c l o s e l y r e l a t e d dimensions, F i r s t l y , the p u b l i c has f e l t t h a t some groups i n our s o c i e t y have not f u l l y enjoyed the b e n e f i t s o f the more gen e r a l improvement i n the q u a l i t y and q u a n t i t y o f housing. These groups are f r e q u e n t l y i d e n t i f i e d as low income, the disadvantaged and the e l d e r l y . The second problem i s t h a t the p u b l i c has p e r c e i v e d t h a t housing p r i c e s are too high and out of the f i n a n c i a l reach of many persons and f a m i l i e s . These two f a c t o r s , when co n s i d e r e d cumula-t i v e l y , can be manifest i n t o a s i n g u l a r housing problem, t h a t b e i ng one of a f f o r d a b i l i t y . 77 The s e n i o r l e v e l s o f government have responded to the p u b l i c ' s concerns by c r e a t i n g numerous programs r e l a t i n g to housing. The m a j o r i t y of these have been intended to implement e i t h e r s o c i a l p o l i c y w i t h r e s p e c t to housing or gen e r a l economic p o l i c y which d i r e c t l y or i n d i r e c t l y a f f e c t s housing markets (Pennance, 1976). The f e d e r a l government has made a c o n s i d e r a b l e number of c o n t r i b u t i o n s towards housing i n g e n e r a l . I t has, through the then C e n t r a l Mortgage and Housing Corpora-t i o n (CMHC) - a crown c o r p o r a t i o n empowered to cr e a t e p u b l i c p o l i c y r e l a t i n g to housing - i n t e r v e n e d i n the r e s i -d e n t i a l mortgage markets as p a r t of ge n e r a l monetary and economic p o l i c y and ex e r t e d s i g n i f i c a n t e f f e c t s on housing markets. The v a r i o u s N a t i o n a l Housing Acts and t h e i r p r o v i s i o n s , which have emphasized a s s i s t a n c e f o r p r e f e r a b l y new home ownership, have a l s o had s i g n i f i c a n t impact. The i n t r o d u c t i o n and the promotion of the more r e c e n t " A s s i s t e d Home Ownership Program" and " R e g i s t e r e d Home Ownership Savings Program" has showed t h a t i t wishes to continue with t h i s t r a d i t i o n . At the p r o v i n c i a l government l e v e l , B r i t i s h Columbia has, i n p a r t i c u l a r , tended to f o l l o w the examples s e t by the f e d e r a l government. In doing so, i t has encouraged new home ownership by measures such as the Home Owner Grant, Home A c q u i s i t i o n Grant and Second Mortgage programs. More r e c e n t l y , although c o n t i n u i n g to emphasize i t s t r a d i t i o n a l approach, p r o v i n c i a l housing l e g i s l a t i o n had been expanded 78 considerably to include such programs, as: Assisted Home Ownership, Home. Purchase.Assistance, Co-Operative Housing Assistance, Senior C i t i z e n s ' Housing, Assisted Rental, RentAid, and Shelter Aid for El d e r l y Renters. While many of the new housing programs of the late 1960's and early 1970's did help .to. ameliorate the so-called "housing c r i s i s " i n the province to some extent, i t by no means eradicated the problem. In the mid-1970's the p r o b l e m . s t i l l existed and the public continued to emphasize i t s concerns. In further attempts to solve t h i s problem, the pr o v i n c i a l government i n 1976 - through the then Minister of Municipal A f f a i r s and Housing, the Honourable Hugh Curtis - established the Joint Committee on Housing. It was the p r o v i n c i a l government's intention to have t h i s Committee enquire into the problems a f f e c t i n g the delivery of housing i n t h i s province and make recommendations, which could be translated into applicable p r o v i n c i a l p o l i c y and l e g i s l a t i o n . As the chairman of .this Committee was the Honourable Sam.Bawlf, the report has been commonly referred to as "The Bawlf Report". The Bawlf Report: The Joint Committee on Housing was comprised- of 12 members, consisting of three Members of the L e g i s l a t i v e Assembly,, four representatives from the Union of B r i t i s h Columbia M u n i c i p a l i t i e s (UBCM) and f i v e members from the 79 then Department of M u n i c i p a l A f f a i r s and Housing. The Committee's task was to i n v e s t i g a t e the problems a f f e c t i n g housing, e s p e c i a l l y i n regards to consumer a f f o r d a b i l i t y . The Committee h e l d s e v e r a l meetings throughout the p r o v i n c e and r e c e i v e d i n p u t from a number of p a r t i e s r e p r e s e n t i n g the involvement of government, p r o f e s s i o n s , b u i l d e r s and l e n d e r s i n the p r o d u c t i o n of housing. I t a l s o r e c e i v e d and c o n s i d e r e d numerous w r i t t e n b r i e f s d u r i n g the course of i t s i n v e s t i g a t i o n from i n t e r e s t e d p a r t i e s such as the P l a n n i n g I n s t i t u t e of B r i t i s h Columbia, the l o c a l chapter of the Housing and Urban Development Asso-c i a t i o n of Canada (HUDAC) and v a r i o u s r e a l e s t a t e boards, j u s t to mention a few. In a d d i t i o n , the Committee con-ducted numerous s t u d i e s through i t s own resources i n order to a t t a i n a more comprehensive overview of the s i t u a t i o n . In a l l , the Committee s t u d i e d and r e p o r t e d on s i x aspects of the housing problem: (1) the supply of land; (2) l a n d use c o n t r o l s ; (3) the c o s t s of s e r v i c e s ; (4) p l a n -ning f o r growth; (5) the housing marketplace; and (6) t e c h -n o l o g i c a l f a c t o r s . In s t u d y i n g these a s p e c t s , the Committee found t h a t " c h i e f among the u n d e r l y i n g problems a f f e c t i n g the d e l i v e r y of housing were a number of f a c t o r s i n the system of government c o n t r o l s over p l a n n i n g , s e r v i c i n g and development of housing which unduly c o n s t r a i n e d the p r o d u c t i o n p r o c e s s " . The r e p o r t concluded t h a t : " r e o r g a n i -z a t i o n and s t r e a m l i n i n g of the r o l e of government i n t h i s process i s e s s e n t i a l to e f f i c i e n t , c o m p e t i t i v e p r o d u c t i o n and hence, to consumer a f f o r d a b i l i t y " . 80 In the r e p o r t , some 30 recommendations were presented to achieve t h i s end. The recommendations took the form of suggested changes to p r o v i n c i a l p o l i c i e s and p r a c t i c e s r e l a t i n g to housing, f u r t h e r r e s e a r c h and a n a l y s i s on v a r i o u s f a c t o r s , and suggested amendments to the M u n i c i p a l Act. Of p a r t i c u l a r concern to t h i s study are the recom-mendations f o r amendments to the M u n i c i p a l A c t , p a r t i c u l a r l y i n regard, to land use c o n t r o l s and the c o s t s of s e r v i c e s . The r e p o r t ' s recommendations d e a l i n g s p e c i f i c a l l y with these, are as f o l l o w s : "Amend the M u n i c i p a l Act to pr o v i d e t h a t : 1. Reference to the land use c o n t r a c t be rep e a l e d as of J u l y 1, 1978. 2. C o u n c i l may r e q u i r e issuance of a development permit and n e g o t i a t e same based on s a t i s f a c t i o n of c r i t e r i a s e t out i n the zoning by-law. 3. M u n i c i p a l i t i e s may by by-law l e v y impost and o f f - s i t e charges, based on provable c o s t s , as a c o n d i t i o n o f s u b d i v i s i o n or development permit approval or a b u i l d i n g permit, s u b j e c t to r e g u l a t i o n by the L i e u t e n a n t -Governor i n C o u n c i l . " The Committee's r a t i o n a l f o r removing the land use c o n t r a c t p r o v i s i o n s and r e p l a c i n g i t with the develop-ment permit system was very e v i d e n t i n the r e p o r t . The r e p o r t r e v e a l e d t h a t the Committee f e l t some m u n i c i p a l i t i e s were abusing the land use c o n t r a c t p r o v i s i o n s and were s t r a y i n g from the i n i t i a l i n t e n t i o n of the l e g i s l a t i o n -t h a t being, to empower C o u n c i l s to pro v i d e f o r e x c e p t i o n a l l y comprehensive developments. The r e p o r t e x p r e s s l y noted 81 t h a t many m u n i c i p a l i t i e s were a p p l y i n g the l a n d use c o n t r a c t s to e s t a b l i s h a second l e v e l of t a x a t i o n i n the form of impost fees and other s e r v i c i n g charges and to r e q u i r e e x c e s s i v e l y h i g h standards of s e r v i c e s from d e v e l o p e r s . A l s o , the r e p o r t c l e a r l y i n d i c a t e d t h a t the Com-mittee f e l t land use c o n t r a c t s were causing unreasonable delays i n the development process and was unduly i n c r e a s i n g the c o s t of housing. The Committee comments i n t h i s regard are as f o l l o w s : (Due to l a n d use c o n t r a c t s ) " a p p l i c a n t s f o r r e l a t i v e l y o r d i n a r y land use approvals are being r e q u i r e d to n e g o t i a t e t h e i r p r o j e c t s through an i n c r e a s i n g l y complex maze. The o v e r a l l e f f e c t . . . has been to g r e a t l y r e t a r d the supply of l a n d and the e f f i c i e n c y of producers. As a r e s u l t , the s h o r t supply of l a n d approved f o r v i a b l e development has been b i d up to u n r e a l i s t i c l e v e l s . T h i s e x c e s s i v e c o s t i s simply passed on by the b u i l d e r to the consumer" ( J o i n t Committee on Housing, 1976). Although i t was not e x p r e s s l y s t a t e d i n the Bawlf Report, the Committee's fundamental o b j e c t i v e i n recommending the removal of the l a n d use c o n t r a c t p r o v i s i o n was to r e t u r n the m u n i c i p a l i t i e s to a r e g u l a t o r y r o l e once again as opposed to a l l o w i n g the tendency of m u n i c i p a l i t i e s to conduct con-t r a c t u a l n e g o t i a t i o n s (R. MacKenzie, 1978). I t would appear from the recommendations there was a d e f i n i t e attempt to r e i n s t a t e zoning as the primary m u n i c i p a l c o n t r o l of l a n d use. A n c i l l a r y to t h i s , " c e r t a i n t y " was to become the key word and the major f a c t o r s of development were to be known a t the o u t s e t (R. MacKenzie, 1978). T h i s was s i m i l a r i n p r i n c i p l e to the suggested amendments r e g a r d i n g impost f e e s , 82 which w i l l be d i s c u s s e d l a t e r . Many of the recommendations emanating from the Bawlf Report were accepted by the p r o v i n c i a l government, wit h o n l y minor changes. These have been r e f l e c t e d , as o r i g i n a l l y intended, i n p o l i c y changes f o r p r o v i n c i a l govern-ment departments (now c a l l e d " m i n i s t r i e s " ) and l e g i s l a t i v e amendments to a p p r o p r i a t e s t a t u t e s ; one example of the l a t t e r b e i n g the i n c l u s i o n of the development permit system, as S e c t i o n 702AA i n the M u n i c i p a l Act. 5.3 Development Cost Charges: I t i s now q u i t e e v i d e n t t h a t the recommendation of the Bawlf Report, r e f e r r i n g s p e c i f i c a l l y to o f f - s i t e charges, was not taken l i g h t l y by the p r o v i n c i a l l e g i s -l a t u r e . T h i s recommendation has been r e f l e c t e d i n the i n c l u s i o n of S e c t i o n 702C as an amendment to the M u n i c i p a l Act and r e p r e s e n t s the l e g a l i z a t i o n of many impost fees imposed by m u n i c i p a l i t i e s through lan d use c o n t r a c t s or otherwise. Evidence from the Bawlf Report i n d i c a t e s t h a t the main reason behind the Committee's recommendation to a l l o w m u n i c i p a l i t i e s to l e v y impost and o f f - s i t e charges, emanated from i t s concern f o r the m u n i c i p a l i t i e s ' f i n a n c i a l predicament r e g a r d i n g the c o s t s of s e r v i c i n g new develop-ment areas. The r e p o r t s t a t e d t h a t without impost fees or s i m i l a r charges, many m u n i c i p a l i t i e s c o u l d not a f f o r d the c o s t s of expanding s e r v i c e s to enable growth. The 83 Committee found t h i s e s p e c i a l l y t r u e of the suburban muni-c i p a l i t i e s which have to absorb most of the urban growth with o n l y a f r a c t i o n of the urban assessment base, and made s p e c i f i c r e f e r e n c e to t h i s . However, f u r t h e r evidence from the r e p o r t a l s o i n d i c a t e d t h a t w hile the Committee was s u p p o r t i v e of those m u n i c i p a l i t i e s t h a t showed a genuine attempt to p r o t e c t t h e i r e x i s t i n g taxpayers from the c o s t burdens of o f f - s i t e f a c i l i t i e s to serve new developments, i t was a l s o apprehensive of the i m p l i c a t i o n s of g r a n t i n g u n l i m i t e d t a x i n g power to the m u n i c i p a l i t i e s f o r t h i s pur-pose. I t s concern was t h a t i f m u n i c i p a l i t i e s were given complete autonomy i n t h i s regard, some may abuse the i n t e n t of the new grant i n powers. The Committee based t h i s concern on widespread c r i t i c i s m s i t r e c e i v e d from developers s t a t i n g > t h a t some m u n i c i p a l i t i e s had over r e a c t e d to the powers granted to them to conduct c o n t r a c t u a l n e g o t i a t i o n s . The developers claimed t h a t some m u n i c i p a l i t i e s were r e q u i r i n g e x c e s s i v e l y high s e r v i c e standards, so as to a v o i d high maintenance c o s t s and the c o s t s of upgrading s e r v i c e s i n the f u t u r e . The Committee noted t h a t 60 f o o t roadways wi t h f u l l curbs and g u t t e r s , sidewalks and underground w i r i n g were f r e q u e n t l y being r e q u i r e d by a m u n i c i p a l i t y , w hile some of the most f a s h i o n a b l e and expensive e x i s t i n g sub-d i v i s i o n s i n a d j o i n i n g areas of t h a t m u n i c i p a l i t y d i d not enjoy these amenities. The r e p o r t makes i t e v i d e n t l y c l e a r t h a t by wording the recommendation i n the manner presented, the Committee has shown t h a t i t r e c o g n i z e d the m u n i c i p a l i t i e s ' 84 f i n a n c i a l predicament, but were s t r o n g l y opposed to promoting the c o n t i n u a t i o n of i n c o n s i s t e n c i e s i n the development approval process which i t found was o c c u r r i n g through the use o f the land use c o n t r a c t . That would appear to be the l o g i c behind such c l a u s e s i n the recommendation as: "based on provable c o s t s " and " s u b j e c t to r e g u l a t i o n by the Lieutenant-Governor i n C o u n c i l " . T h i s same concern was a l s o r e f l e c t e d i n the l e g i s l a t i o n which e v o l v e d from t h i s recommendation. Although minor changes i n wording have occur r e d i n the a p p r o p r i a t e c l a u s e s of the M u n i c i p a l A c t , the b a s i c i n t e n t has remained the same. I t i s probably f a i r to say t h a t most m u n i c i p a l i t i e s and developers f e l t t h a t there was a need f o r l e g i s l a t i o n to govern t h i s aspect o f t h e i r r e l a t i o n s h i p . The mu n i c i -p a l i t i e s wanted to " l e g a l i z e " t h e i r r i g h t to c o l l e c t impost fees and the developers wanted some l e g a l l i m i t to the purpose and amount to be l e v i e d . The p r o v i n c i a l government responded to both these concerns and brought some order and c o n s i s t e n c y i n t o t h i s s t a t e of a f f a i r s by a c c e p t i n g the b a s i c p r i n c i p l e s of the Bawlf Report's recommendation i n t h i s r e gard. The L e g i s l a t i o n (Municipal Act, S e c t i o n 702C): On the 31st day of August 1977, the M u n i c i p a l Amendment Act (1977) passed t h i r d and f i n a l r e a d i n g by the p r o v i n c i a l l e g i s l a t u r e . T h i s day saw the abolishment of impost fees a t a date to be f i x e d by the L i e u t e n a n t -85 Governor i n C o u n c i l , and the c r e a t i o n o f a new source of revenue f o r m u n i c i p a l i t i e s , i n the form of the development c o s t charge. In the words of Mr. G. Wilson - of the Wilson Bauman law f i r m i n Kelowna - the p r i n c i p a l l e g a l draftsman of B i l l 42, the purpose and phi l o s o p h y of the development c o s t charges are: ". . . t o provide the m u n i c i p a l i t y with a source of revenue so t h a t the m u n i c i p a l i t y may c a l l upon i t s banked c a p i t a l c o s t charges to pay f o r a major c a p i t a l expen-d i t u r e t h a t becomes necessary i n r e l a t i o n to i t s highways, sewer, water or drainage systems. The c a p i t a l expenditure must r e l a t e to a c o s t t h a t i s c r e a t e d by the f u t u r e development of the m u n i c i p a l i t y and as a r e s u l t i t i s f a i r t h a t the new development pay an e x t r a c o n t r i b u t i o n over and above t h a t p a i d f o r g e n e r a l l y out of mun i c i p a l funds towards the c o s t of such a d d i t i o n a l f a c i l i t y . By way of an example, a 500,000 g a l l o n r e s e r v o i r may be s u f f i c i e n t water storage f o r the e x i s t i n g m u n i c i p a l i t y , but every time an a d d i t i o n a l r e s i d e n t i a l or commercial water user i s added to the munici-p a l i t y , i t becomes i n e v i t a b l e t h a t i n the f u t u r e an a d d i t i o n a l water r e s e r v o i r f a c i l i t y must be prov i d e d . " (Continuing L e g a l Education S o c i e t y o f B r i t i s h Columbia, 1979.) The development c o s t charge l e g i s l a t i o n p r o v i d e s a m u n i c i p a l i t y with the o p p o r t u n i t y of c o l l e c t i n g a s p e c i f i c sum of money f o r a s p e c i f i c c a p i t a l purpose at s p e c i f i c times. In e f f e c t , i t i s a l i m i t e d v e r s i o n of the c a p i t a l c o s t impost fee, which some m u n i c i p a l i t i e s had been u s i n g s i n c e the mid 1960's. The requirements and r e g u l a t i o n s con-c e r n i n g the development c o s t charge are d e t a i l e d i n S e c t i o n 702C of the M u n i c i p a l A c t , a copy of which i s i n c l u d e d as Appendix 7. 86 S e c t i o n 702C(1) s p e c i f i e d the c o n d i t i o n s under which the development c o s t charge can be l e v i e d by the m u n i c i p a l i t y . T h i s c l a u s e l i s t s three events which c o u l d a c t i v a t e t h i s l e v y , namely: "702C(1) The C o u n c i l may, by by-law impose development c o s t charges on every person who o b t a i n s : (a) approval of the s u b d i v i s i o n of a p a r c e l of land under the Land R e g i s t r y Act or the S t r a t a T i t l e s A c t f o r any purpose other than the c r e a t i o n of three or l e s s l o t s to p rovide s i t e s f o r a t o t a l of three or l e s s s e l f -c o n t a i n e d d w e l l i n g u n i t s , or (b) a b u i l d i n g permit a u t h o r i z i n g the c o n s t r u c t i o n or a l t e r a t i o n of b u i l d i n g s or s t r u c t u r e s f o r any purpose other than the c o n s t r u c t i o n of three or l e s s s e l f - c o n t a i n e d d w e l l i n g u n i t s , or (c) a b u i l d i n g permit a u t h o r i z i n g con-s t r u c t i o n , a l t e r a t i o n or e x t e n s i o n of a b u i l d i n g or s t r u c t u r e , other than a b u i l d i n g or p o r t i o n of i t used f o r r e s i d e n t i a l purposes, where the value of the work exceeds $25,000." In a d d i t i o n to d e t a i l i n g the three events which may t r i g g e r the development c o s t charge, t h i s s e c t i o n p o i n t s out t h a t when a development c o s t charge i s to be l e v i e d , i t must be imposed by a m u n i c i p a l by-lav/. The by-law i t s e l f i s r e l a t i v e l y simple and s t r a i g h t forward, as i t b a s i c a l l y r e i t e r a t e s the s t a t u t o r y a u t h o r i t y and c o n d i t i o n s imposed by the M u n i c i p a l Act. T h i s , i n e f f e c t , i s the e n a c t i n g p o r t i o n s . Attached to the by-law are the schedules, as r e q u i r e d by Sub-Section 5, which, as w i l l be shown l a t e r , are the complex p o r t i o n s of the by-law. An example of the e n a c t i n g p o r t i o n of the by-law i s i n c l u d e d as Appendix 8. 87 T h i s example i s a sample by-law, d r a f t e d and c i r c u l a t e d to a l l m u n i c i p a l i t i e s i n B r i t i s h Columbia by the M i n i s t r y of M u n i c i p a l A f f a i r s . As t h i s sample by-law comes d i r e c t l y from the s t a t u t o r y a u t h o r i t y of the M u n i c i p a l A c t, i t i s d i r e c t l y a p p l i c a b l e to a l l m u n i c i p a l i t i e s , except the C i t y of Vancouver which has i t s own c h a r t e r . S e c t i o n 702C(2) s p e c i f i e s when the development c o s t charge can be e x t r a c t e d by the m u n i c i p a l i t y . I t s t a t e s : "Development c o s t charges r e q u i r e d to be p a i d pursuant to a by-law under t h i s s e c t i o n s h a l l be p a i d p r i o r to the approval of the s u b d i v i s i o n or the i s s u e of the b u i l d i n g permit, as the case may be." The word " s h a l l " i n t h i s c l a u s e r e p r e s e n t s a mandatory c o n d i t i o n ; t h i s requirement of prepayment cannot be waived or a l t e r e d by the m u n i c i p a l i t y . One of the major r e s t r i c t i o n s c o ntained i n the M u n i c i p a l Act f o r development c o s t charges i s Sub-Section (3) of S e c t i o n 702C. This i s the cl a u s e which d e t a i l s the c o n d i t i o n s under which a development c o s t charge cannot be l e v i e d . T h i s s u b - s e c t i o n p r o v i d e s t h a t such exemption would apply i f the development c o s t charge has p r e v i o u s l y been p a i d with r e s p e c t to the same development which i n c l u d e s e i t h e r a b u i l d i n g and s t r u c t u r e or the s u b d i v i s i o n of lan d unless a f u r t h e r s u b d i v i s i o n or a d d i t i o n a l development i s c a r r i e d out, no new c a p i t a l c o s t burden i s deemed to take p l a c e and t h e r e f o r e no development c o s t charge i s payable. S i m i l a r i l y , i f the s u b d i v i s i o n or development does not 88 impose new c a p i t a l c o s t burdens on the m u n i c i p a l i t y , development c o s t charges cannot be r e q u i r e d . F u r t h e r r e s t r i c t i o n s are noted i n Sub-Section (4), which enumerates the purposes f o r which these charges can be imposed. T h i s s u b - s e c t i o n notes t h a t development c o s t charges may be imposed " f o r the s o l e purpose of p r o v i d i n g funds to a s s i s t the m u n i c i p a l i t y i n paying the c a p i t a l c o s t of p r o v i d i n g , a l t e r i n g or expanding sewage, water, drainage and highway f a c i l i t i e s and p u b l i c open space, or any of them, i n order t o serve, d i r e c t l y or i n d i r e c t l y , the development i n r e s p e c t o f which the charges are imposed". The r e s t r i c t i o n s i n t h i s c l a u s e appear, a t f i r s t g l ance, to be r a t h e r minor, but they run much deeper than one might r e a l i z e . When compared to the e a r l i e r B r i t i s h Columbia experience with the impost fee, the r e s t r i c t i o n s i n t h i s c l ause appear to be very severe, from the p o i n t of view of the c o s t - c o n s c i o u s m u n i c i p a l i t y . The main l i m i t a t i o n i s brought about by the word " a s s i s t " . These funds are to be p r o v i d e d i n order "to a s s i s t " the m u n i c i p a l i t y . T h i s word presumably means t h a t the developer cannot be expected to absorb the f u l l c o s t . The percentages a t t r i b u t a b l e to the developer and m u n i c i p a l i t y r e s p e c t i v e l y w i l l , undoubtedly, have to be j u s t i f i e d by the m u n i c i p a l i t y i f the Inspector or a developer q u e s t i o n s the amounts (MacKenzie, 1978). The only f l e x i b i l i t y i n t h i s c l a u s e i s the word " i n d i r e c t l y " . Undoubtedly, the Inspector o f M u n i c i p a l i t i e s or the c o u r t s w i l l have to e v e n t u a l l y c l a r i f y the f u l l 89 extent of j u s t how i n d i r e c t " i n d i r e c t l y " i s . To date, the Inspector of M u n i c i p a l i t i e s has made some c l a r i f i c a t i o n on t h i s term, but by no s t r e t c h of the i m a g i n a t i o n , i s i t a l l -encompassing. The Inspector has i n d i c a t e d t h a t he w i l l not i n c l u d e l a n d f o r school grounds as p u b l i c open space (Wilson, Continuing L e g a l Education S o c i e t y of B r i t i s h Columbia, 1979). Sub-Section (5) c l e a r l y s p e c i f i e s t h a t a schedule of development c o s t charges must accompany the m u n i c i p a l by-law, as p r e v i o u s l y mentioned. T h i s s u b - s e c t i o n f u r t h e r s t a t e s "the charges may vary i n r e s p e c t of (a) d i f f e r e n t d e f i n e d or s p e c i f i e d areas or zones, (b) d i f f e r e n t uses, (c) d i f f e r e n t c a p i t a l c o s t s r e l a t e d to any c l a s s of develop-ment, and (d) d i f f e r e n t s i z e s or numbers o f u n i t s or l o t s c r e a t e d by or as a r e s u l t of development; but otherwise, the charges s h a l l be s i m i l a r f o r a l l developments t h a t impose s i m i l a r c a p i t a l c o s t burdens on the m u n i c i p a l i t y " . In essence then, the development c o s t charge must be d i r e c t l y r e l a t e d to the c a p i t a l c o s t of p r o v i d i n g those items mentioned i n Sub-Section (4) and may o n l y be v a r i e d a c c o r d i n g to the p r o v i s i o n s of Sub-Section (5). U n l i k e the e n a c t i n g p o r t i o n of the by-law, which i s b a s i c a l l y s t r a i g h t forward, the schedules of development co s t charges forms the more complex p o r t i o n . I t i s i n the schedules t h a t the m u n i c i p a l i t y must s p e c i f y the amount of charges to be imposed a c c o r d i n g to d i f f e r e n t zones, d i f f e r e n t uses and d i f f e r e n t areas, A g r e a t d e a l of care and a t t e n t i o n 90 must be taken i n p r e p a r i n g the schedules s i n c e the m u n i c i -p a l i t y may have to j u s t i f y i t s c a l c u l a t i o n s to the Inspector of M u n i c i p a l i t i e s , a c c o r d i n g to Sub-Section (9), or the c o u r t s , should a developer f e e l t h a t a development c o s t charge i s not warranted or i s unreasonable. The schedule w i l l be the most c o n t r o v e r s i a l p o r t i o n of the by-law. Examples of the development c o s t charge schedule, as i t r e l a t e s to the C i t y of P r i n c e George, i s i n c l u d e d as Appendix 9. A l s o i n c l u d e d i n t h i s appendix i s a r a t h e r lengthy but worthy e x p l a n a t i o n of how these charges were c a l c u l a t e d by the C i t y of P r i n c e George. In t h i s e x c e r p t , Mr. R. Dick - the C i t y S o l i c i t o r f o r the C i t y of P r i n c e George - a l s o p r o v i d e s many h e l p f u l h i n t s f o r the p r e p a r a t i o n of the schedules, and d e t a i l s areas where problems may occur. There are four s t a t u t o r y c o n s i d e r a t i o n s s e t out i n Sub-Section (6) of S e c t i o n 702C t h a t must be taken i n t o c o n s i d e r a t i o n by the c o u n c i l a t the time of p a s s i n g the by-law to l e v y the development c o s t charge. T h i s s e c t i o n of the M u n i c i p a l Act s t a t e s : "(6) In f i x i n g development c o s t charges i n a by-law under Sub-Section (1), the C o u n c i l s h a l l take i n t o c o n s i d e r a t i o n whether or not: (a) the charges are e x c e s s i v e i n r e l a t i o n to the c a p i t a l c o s t of p r e v a i l i n g standards of s e r v i c e i n the m u n i c i -p a l i t y , (b) the charges w i l l d e t e r development i n the m u n i c i p a l i t y , (c) the charges w i l l d i scourage the con-s t r u c t i o n of reasonably p r i c e d housing or the p r o v i s i o n of reasonably p r i c e d s e r v i c e d l a n d , and 91 (d) the municipality has imposed requirements pursuant to Section 702A, 702AA or 711. It i s quite clear from t h i s sub-section that the l e g i s l a t i o n is. being t a i l o r e d to prevent the inconsistencies which were discussed e a r l i e r , with regards to the land use contract. In s p e c i f i c a l l y stating clauses, (a), (b) and (c) above, the l e g i s l a t i o n i s c l e a r l y declaring that the development cost charges cannot be used to require exces-s i v e l y high s e r v i c i n g standards -which may discourage or deter future development. Further,;:by including clause (d) , the l e g i s l a t i o n i s insuring that duplication of s e r v i c i n g l e v i e s - through such means as the. land use contract, the development permit or other by-law requirements - w i l l not occur. Sub-Sections (7) and (8) of Section 702C provide for and regulate a s p e c i a l development reserve fund. These sub-sections .-stipulate that upon receiving a development cost charge, the municipality must deposit that charge i n a s p e c i a l account. After the money has been deposited, i t can only be used for the purpose for which.it was c o l l e c t e d , unless a variance i s permitted, under the provisions of Section 305A and 307(2) of the Municipal Act by the Minister of Municipal A f f a i r s . Sub-Section (8) goes on to provide associated purposes for which development cost charges can be collected... This section enumerates planning, engineering and l e g a l costs as e l i g i b l e development costs, i f associated with the provisions set out i n Sub-Section (4). Further, 1 92 Sub-Section (8) r e q u i r e s t h a t a l l payments from r e s e r v e funds must be a u t h o r i z e d by by-law. Sub-Section (9) of S e c t i o n 702C i s p a r t i c u l a r l y important because i t g i v e s the p r o v i n c i a l government, through i t s Inspector of M u n i c i p a l i t i e s , c o n s i d e r a b l e con-t r o l over a m u n i c i p a l i t y ' s use of the development c o s t charge. Acc o r d i n g to t h i s s u b - s e c t i o n , a m u n i c i p a l i t y must r e c e i v e the approval of the Inspector of M u n i c i p a l i -t i e s p r i o r to the adoption of a by-law to impose such l e v i e s . The Inspector has the wide d i s c r e t i o n a r y powers to grant the a p p r o v a l , r e f u s e to grant i t f o r any of the four reasons s e t out i n t h i s s u b - s e c t i o n or "revoke or w i t h h o l d the approval u n t i l the terms of the by-law are a l t e r e d and amended to h i s s a t i s f a c t i o n and i n accordance with h i s d i r e c t i o n " . As a case i n p o i n t , S e c t i o n 702C(9) (b) ( i i ) r e f l e c t s the amount of power granted to the I n s p e c t o r . T h i s s e c t i o n empowers the Inspector to r e q u i r e the m u n i c i p a l i t y to adopt an o f f i c i a l community pl a n before he w i l l approve a development c o s t charge by-law. As a f u r t h e r emphasis to show j u s t how much d i s c r e t i o n a r y power the Inspector i s g i v e n , the l e g i s l a t i o n , through S e c t i o n 7 0 2 C ( 9 ) ( b ) ( i v ) , delegates the Inspector the power to r e f u s e to grant the approval i f " i n h i s o p i n i o n the by-law does not comply with the s p i r i t and i n t e n t of t h i s s e c t i o n " . I t i s t h i s p r o v i s i o n t h a t appears to guarantee the proper use of the development c o s t charge p r o v i s i o n s to recover o n l y those c o s t s e n v i s i o n e d by the e n a b l i n g l e g i s l a t i o n . 9 3 In c o n s i d e r i n g whether or not a,development c o s t charge by-law w i l l be approved, the Inspector w i l l be con-s i d e r i n g the v a r i o u s c r i t e r i a s e t out i n 702C. He w i l l be c o n s i d e r i n g whether or not the development c o s t charge i s r e l a t e d to a c a p i t a l c o s t a t t r i b u t a b l e to p r o j e c t s i n c l u d e d i n a c a p i t a l budget; he w i l l be c o n s i d e r i n g whether or not the c a p i t a l c o s t i s r e l a t e d to o f f i c i a l community or s e t t l e -ment plans o f the m u n i c i p a l i t y or r e g i o n a l d i s t r i c t ; he w i l l be c o n s i d e r i n g whether or not the charges are e x c e s s i v e , w i l l d e t e r development or w i l l discourage the c o n s t r u c t i o n of reasonably p r i c e d housing or the p r o v i s i o n of reasonably p r i c e d s e r v i c e d land and whether or not other by-law r e q u i r e -ments or l a n d use c o n t r a c t s have alr e a d y imposed c o s t s f o r the same p r o j e c t s . In a l l l i k e l i h o o d , he w i l l a l s o be con-s i d e r i n g the amount c o n t r i b u t e d to the proposed c a p i t a l c o s t p r o j e c t by the s e n i o r l e v e l s of government under e x i s t i n g grant programs. I t i s q u i t e apparent from S e c t i o n 702C t h a t the p r o v i n c i a l government has r e c o g n i z e d the f i n a n c i a l p r e d i c a -ment of m u n i c i p a l i t i e s i n regard to t h e i r i n a b i l i t y t o cope with the c o s t s of expanding s e r v i c e s to enable growth. Thus, i t has granted the m u n i c i p a l i t i e s the l e g i s l a t i v e power to a c q u i r e s p e c i f i c revenues, through s p e c i f i c means and under s p e c i f i c c o n d i t i o n s . The u n d e r l y i n g b a s i s i s t h a t the p r o v i n c i a l government, i n g r a n t i n g these powers, has r e t a i n e d a c o n s i d e r a b l e amount of d i s c r e t i o n over the use of such power. T h i s i s a l l i n keeping with the i n t e n t of the l e g i s l a t i o n to be r e g u l a t o r y , uniform and t a x i n g . 94 I t i s important to note t h a t although S e c t i o n 702C grants the m u n i c i p a l i t y the l e g i s l a t i v e power to a c q u i r e s p e c i f i c revenues from d e v e l o p e r s , these enumerated powers do not r e p r e s e n t the only means a v a i l a b l e to the m u n i c i p a l i t y . As d i s c u s s e d i n Chapter Four, m u n i c i p a l i t i e s - u s i n g t h e i r a d m i n i s t r a t i v e powers - can e n t e r c o n t r a c t u a l agreements ( i . e . , development c o n t r a c t s ) w i t h developers and c o n t r a c t with them to p r o v i d e c e r t a i n revenues i n exchange f o r some form of m u n i c i p a l c o n s i d e r a t i o n . Both means can be used to accomplish the same purpose. In most i n s t a n c e s , the development c o s t charge l e g i s l a t i o n simply p r o v i d e s a more d i r e c t and uniform method of a c q u i r i n g these revenues. 5.4 A Survey of the Development Cost Charge i n B r i t i s h Columbia (1979):  P r i o r to the i n c l u s i o n of S e c t i o n 702C i n the M u n i c i p a l Act, m u n i c i p a l i t i e s d i d not have any g u i d e l i n e s governing the" i m p o s i t i o n of impost or s i m i l a r type f e e s . Consequently, what the impost fee p a i d f o r and how i t was a p p l i e d v a r i e d from l o c a l i t y to l o c a l i t y , with no standar-d i z a t i o n . In e f f e c t , m u n i c i p a l i t i e s had to independently decide the amount of imposts and the method of a p p l i c a t i o n . S e c t i o n 702C of the M u n i c i p a l Act brought order and c o n s i s t e n c y i n t o t h i s s t a t e of a f f a i r s . E f f e c t i v e l y , t h i s l e g i s l a t i o n p r o v i d e s the c o n d i t i o n s under which s p e c i f i c revenues can be a c q u i r e d through s p e c i f i c means, as d i s c u s s e d i n the preceeding s e c t i o n . A review of the survey r e s u l t s w i l l show t h i s s t a n d a r d i z a t i o n . 95 Methodology of Survey: On the 3rd o f J u l y 1979, the Inspector o f M u n i c i -p a l i t i e s , Mr. W. Long, a l s o Deputy M i n i s t e r o f M u n i c i p a l A f f a i r s , was i n t e r v i e w e d . During the i n t e r v i e w , the Inspector was informed of t h i s study's o b j e c t i v e s and was asked to provide comments and i n f o r m a t i o n on development co s t charges i n g e n e r a l . The Ins p e c t o r was very h e l p f u l i n t h i s regard, with many of h i s comments r e f l e c t e d i n v a r i o u s p a r t s of t h i s study. Due to the f a c t t h a t a l l development c o s t charge by-laws have to r e c e i v e the approval from the Ins p e c t o r ' s o f f i c e , p r i o r to f i n a l adoption and implementation, Mr. W. Long was, a l s o asked to provide s t a t i s t i c a l i n f o r -mation r e l a t i n g to the number and contents of the p a r t i c u l a r by-laws processed through h i s o f f i c e . On t h i s matter, the author was r e f e r r e d to Mr. H.G. Topham, D i r e c t o r of F i n a n c i a l S e r v i c e s with the M i n i s t r y of M u n i c i p a l A f f a i r s , who was a l s o very h e l p f u l i n t h i s r e gard. On J u l y 4, 1979, a f t e r a g e n e r a l b r i e f i n g , Mr. Topham allowed the author to review a l l development c o s t charge by-laws which had r e c e i v e d the Inspector of M u n i c i p a l i t i e s ' a p p r o v a l , as of t h a t date. The r e s u l t s of t h i s i n v e s t i g a t i o n f o l l o w : R e s u l t s of the Survey: * As of J u l y 4, 1979, the Inspector of M u n i c i p a l i -t i e s ' o f f i c e had approved 19 development c o s t charge by-laws, as w e l l as f i v e by-law amendments. * Although the f i r s t development c o s t charge by-law, from the Town of Sidney, was approved as e a r l y as A p r i l 6, 1978, 15 by-laws, or 89 per cent, r e c e i v e d the Inspector's approval d u r i n g the f i r s t s i x months of 19 79. * Of the 19 by-laws which have been approved to date, one by-law was from a r e g i o n a l d i s t r i c t ( i . e . , the C a p i t a l Regional D i s t r i c t ) , one by-law was from a town ( i . e . , the Town of Sidney), seven by-laws were from c i t i e s , and the ten remaining by-laws were from m u n i c i p a l d i s t r i c t s . * Of the seven c i t i e s which had r e c e i v e d approval f o r t h e i r development c o s t charge by-laws, f i v e of them -namely Cranbrook, Kamloops, P e n t i c t o n , P o r t Coquitlam and Vernon - had p r e v i o u s l y imposed impost f e e s , as shown i n the 1977 survey. P r i n c e George, another c i t y which has r e c e i v e d approval f o r i t s by-law, was c o n s i d e r i n g the adoption of the impost fee concept a t the time of the 1977 survey, Duncan, the o t h e r c i t y which has r e c e i v e d the Inspector's approval, was not i n c l u d e d i n the 19 77 q u e s t i o n -n a i r e survey, * Of the ten m u n i c i p a l d i s t r i c t s which had r e c e i v e d approval f o r t h e i r development c o s t charge by-laws, e i g h t of them - namely Burnaby, Coquitlam, Langley, Maple Ridge, Matsqui, Richmond and Surrey - had p r e v i o u s l y imposed impost fe e s , as shown i n the 19 7 7 survey. Although the respondent from Saanich, to the 19 77 survey, had s t a t e d t h a t i t had not, and was not i n t e n d i n g to l e v y imposts, i t would appear t h a t Saanich has a l t e r e d i t s p o l i c y as i t has r e c e i v e d the I n s p e c t o r ' s approval to impose development c o s t charges. P o r t Hardy, the o t h e r m u n i c i p a l d i s t r i c t which has r e c e i v e d the I n s p e c t o r ' s a p p r o v a l , was not i n c l u d e d i n the 1977 q u e s t i o n n a i r e survey. * In a d d i t i o n to the 19 development c o s t charge by-laws which, to date, have alr e a d y been approved, the Inspector's o f f i c e i s i n r e c e i p t of three o t h e r s which are c u r r e n t l y i n the process of being approved. These by-laws are from the C i t i e s of Langley and White Rock and the M u n i c i p a l D i s t r i c t of Campbell R i v e r . * Of the three l o c a l i t i e s which are a w a i t i n g the I n s p e c t o r ' s response, Langley and White Rock p r e v i o u s l y a p p l i e d impost f e e s . In 1977, the respondent from Campbell R i v e r had s t a t e d t h a t the C o r p o r a t i o n was not i n t e n d i n g to l e v y such f e e s . * Based on a review of the by-laws which have been approved thus f a r , the schedules - which d e t a i l the v a r i o u s types of development c o s t charges and i t s a p p l i c a b i l i t i e s to v a r i o u s l a n d uses - were found to be f a r more complex and t e c h n i c a l then the d i s a g g r e g r a t i o n of impost f e e s . T h i s complexity i s c l e a r l y e x e m p l i f i e d i n the P r i n c e George by-law, i n c l u d e d i n Appendix 9. * Table 3 p r o v i d e s a l i s t of the l o c a l i t i e s which 98 are c u r r e n t l y a u t h o r i z e d to impose development c o s t charges. T h i s t a b l e a l s o shows the types of. development c o s t charges ( i . e . , f o r sewage, water, drainage, e t c . ) . i n e f f e c t i n each of the areas and the land...uses to. which they apply. The date on which, the by-law was approved by the In s p e c t o r i s a l s o i n c l u d e d i n t h i s t a b l e . * A review of Table- 3 shows.that o f the f i v e types of development c o s t charges, s p e c i f i c a l l y allowed, by the l e g i s l a t i o n , charges f o r drainage, highway f a c i l i t i e s and p u b l i c open space were the most, common among -the .19 l o c a l i ^ t i e s , w i t h a heavy concentration, of these l o c a l i t i e s being m u n i c i p a l d i s t r i c t s . Thirteen,, or 68. per cent o f the l o c a l i t i e s l e v i e d , these types, of charges. These charges were f o l l o w e d c l o s e l y by l e v i e s f o r water (63%) and sewage (58%) r e s p e c t i v e l y . * Table 3 a l s o shows t h a t o f the v a r i o u s types of la n d uses t h a t were assessed development c o s t charges, the r e s i d e n t i a l use was s i g n i f i c a n t l y the most common - a l l l o c a l i t i e s imposed a t l e a s t one of the f i v e types o f development c o s t charges.on t h i s p a r t i c u l a r l a n d use. Commercial uses, were a l s o common r e c i p i e n t s , o f the charge, with 89 per. cent of the l o c a l i t i e s l e v y i n g some formuof development c o s t charge on t h i s . use. The t a b l e f u r t h e r shows t h a t the v a r i o u s l o c a l i t i e s , were l e s s r e c e p t i v e t o imposing development c o s t charges on i n d u s t r i a l and i n s t i -t u t i o n a l l a n d uses. TABLE 6 A LIST OF LOCALITIES IN BRITISH COLUMBIA WHICH HAVE RECEIVED APPROVAL FROM THE INSPECTOR OF MUNICIPALITIES TO IMPOSE DEVELOPMENT COST CHARGES, SHOWING THE TYPES OF DEVELOPMENT COST CHARGES AND THE APPLICABLE LAND USES FOR EACH LOCALITY -AS OF JULY 4, 1979 Note: An "x" denotes a p p l i c a b i l i t y to the l o c a l i t y . LOCALITY TYPES OF DEVELOPMENT COST CHARGES APPLICABILITY TO LAND USE DATE OF INSPECTOR'S APPROVAL Sewage Water Drainage Highway Open Space Resi-dential Com-mercial Indus-t r i a l I n s t i t u -tional REGIONAL DISTRICTS Capital Regional D i s t r i c t X X X X X Jan. 10/79 TOWNS Sidney X X X X X X X X Apr. 6/78 CITIES Cranbrook X X X X Jan.. 24/79 Duncan X X X X X X Mar. 26/79 Kamloops X X X X X X X X X Dec. 12/78 Penticton X X X X May 8/79 Port Coquitlam X X X X May 17/79 Prince George X X X X X X X Apr. 20/79 Vernon X X X X X X Apr. 25/79 MUNICIPAL DISTRICTS Burnaby X X X Mar. 28/79 Coquitlam X X X May 8/79 Langley X X X X X X X X Jan. 19/79 Maple Ridge X X X X X X X X Jun. 18/79 Matsqui X X X X X X X Jun. 26/79 Port Hardy X X X X X Mar. 20/79 Richmond X X X X X X X Jan. 22/79 Saanich X X X X X X X X X Mar. 15/79 Surrey X X X X X X X X X J u l . 31/78 West Vancouver X X X X X X Apr. 24/79 TOTALS 11/19 12/19 13/19 13/19 13/19 19/19 17/19 13/19 7/19 100 5.5 The Advantages and Disadvantages o f the Development Cost Charge L e g i s l a t i o n :  L i k e any new l e g i s l a t i o n - or anything which i s c r e a t e d as a s u b s t i t u t e f o r something e l s e - there w i l l g e n e r a l l y be some advantages and disadvantages a s s o c i a t e d w i t h i t s use. The development c o s t charge i s no e x c e p t i o n . Although these l e v i e s have on l y been i n e x i s t e n c e f o r a very s h o r t p e r i o d o f time, some of the major advantages and disadvantages o f the l e g i s l a t i o n have a l r e a d y become apparent. Some of the "pros" and "cons" o f the l e g i s l a t i o n have a l r e a d y been noted i n the p r i o r t e x t , but f o r the purpose o f t h i s a n a l y s i s , they warrant r e i t e r a t i o n . Other, p o s s i b l y l e s s obvious, advantages and disadvantages which were not presented i n the t e x t w i l l a l s o be i n c l u d e d . Some o f the f a c t o r s mentioned below have been c l a s s i f i e d both as an advantage and as a disadvantage, depending upon the p e r s p e c t i v e , whether i t be from a muni-c i p a l viewpoint o r the de v e l o p e r ' s . In these i n s t a n c e s , the a p p r o p r i a t e p a r t y to which the advantage or disadvantage accrue, w i l l be noted. Advantages: * P r i o r to the advent o f the development c o s t charge l e g i s l a t i o n , m u n i c i p a l i t i e s were l e f t much on t h e i r own to decide how to f i n a n c e o f f - s i t e development c o s t s . 101 Due to the l a c k o f guidance from the p r o v i n c i a l l e g i s l a t u r e , m u n i c i p a l i t i e s imposed impost fees and developed r a t e s t r u c t u r e s which were u s u a l l y o n l y based on l o c a l needs and c o n v i c t i o n s . The new l e g i s l a t i o n changed a l l t h i s by a l l o w i n g the m u n i c i p a l i t i e s an o p p o r t u n i t y o f c o l l e c t i n g a s p e c i f i c sum of money, f o r s p e c i f i c c a p i t a l purposes, under s p e c i f i c c o n d i t i o n s and a t s p e c i f i c times. * From the developer's p e r s p e c t i v e , the development c o s t charge l e g i s l a t i o n has brought about some much needed order and c o n s i s t e n c y to the development p r o c e s s . T h e i r p a s t experience with the l a n d use c o n t r a c t l e f t them ques-t i o n i n g whether the money which they n e g o t i a t e d to pay to the m u n i c i p a l i t y , was i n f a c t being spent on the f a c i l i t i e s or s e r v i c e s f o r which i t was being c o l l e c t e d . F u r t h e r , they began to q u e s t i o n the remoteness of some of the purposes f o r which they were r e q u i r e d to pay. The new l e g i s l a t i o n s t i p u l a t e d requirements which governed the l i m i t o f purposes and amount of such payment. * In those l o c a l i t i e s which d i d not impose any o f f - s i t e s e r v i c i n g l e v i e s , p r i o r to the advent of S e c t i o n 702C, the l e g i s l a t i o n can be; seen as a means of p r o t e c t i n g the e x i s t e n t taxpayers from the c o s t burdens of p r o v i d i n g o f f - s i t e f a c i l i t i e s to serve new developments. In e f f e c t , the development c o s t charge l e g i s l a t i o n imposes the burden of such c o s t s upon those who c r e a t e the demand f o r them and who b e n e f i t from them. For those l o c a l i t i e s which were imposing f i n a n c i a l c o n t r i b u t i o n s , such as the impost f e e , 102 p r i o r to " B i l l 42", the new l e g i s l a t i o n allows f o r the c o n t i n u a t i o n o f t h i s t r e n d (under s p e c i f i c c o n d i t i o n s ) . * From the p o i n t of view of the p u b l i c , the developers and the p r o v i n c i a l government, S e c t i o n 702C makes the m u n i c i p a l i t y more accountable f o r i t s a c t i o n s i n a c q u i r i n g development c o s t charges. T h i s i s i n keeping w i t h one of the major purposes and p h i l o s o p h i e s of l o c a l government. Some of the elements of t h i s s e c t i o n which r e f l e c t the tendency to i n c o r p o r a t e the a c c o u n t a b i l i t y i s s u e a r e : (1) the l e g i s l a t i o n ' s requirement of the m u n i c i p a l i t y to be able to j u s t i f y the amount of l e v i e s to be charged; (2) the requirement of the m u n i c i p a l i t y to r e c e i v e p r o v i n c i a l approval p r i o r to adoption of any development c o s t charge by-laws; and (3) the requirement of the m u n i c i p a l i t y to d e p o s i t a l l development c o s t charges i n t o separate accounts, depending upon the purposes of the charges, and draw down on these accounts on l y f o r the expressed purposes f o r which they were c o l l e c t e d . * In keeping w i t h the o t h e r l e g i s l a t i v e amendments i n the M u n i c i p a l Amendment Act, 1977, the development c o s t charge l e g i s l a t i o n was c r e a t e d to a s s i s t i n the s t r e a m l i n i n g of the development pro c e s s . T h i s r e f l e c t s a d e f i n i t e advantage to the developer, who can expect l e s s delays i n the approval process (as opposed to the p r e v i o u s experience with the l a n d use c o n t r a c t ) and t h e r e f o r e experience l e s s e r c a r r y i n g c o s t s . 103 * C o r o l l a r y to the above, w i t h other t h i n g s being constant, t h i s should r e s u l t i n i l o w e r housing c o s t s f o r consumers. * From the p l a n n i n g p e r s p e c t i v e , S e c t i o n 702C re p r e s e n t s a d e f i n i t e advantage i n t h a t i t encourages a more comprehensive review of p l a n n i n g i n g e n e r a l . An example of t h i s i s r e f l e c t e d i n Sub-Section ( 9 ) ( b ) ( i i ) which empowers the Inspector of M u n i c i p a l i t i e s to r e q u i r e the m u n i c i p a l i t y to adopt an o f f i c i a l community p l a n b e f o r e he w i l l approve a development c o s t charge by-law. Disadvantages: * One of the major disadvantages of the development c o s t charge l e g i s l a t i o n , from the m u n i c i p a l viewpoint, i s the system's i n f l e x i b i l i t y . Of p a r t i c u l a r concern i s Sub-S e c t i o n (4) of S e c t i o n 702C, which s t a t e s t h a t "development c o s t charges may be imposed . . . f o r the s o l e purpose of p r o v i d i n g funds . . . i n paying the c a p i t a l c o s t of p r o v i d i n g , a l t e r i n g , o r expanding sewage, water, drainage and highway f a c i l i t i e s and p u b l i c open space". Although the l e g i s l a t i o n has been t a i l o r e d so t h a t m u n i c i p a l i t i e s can a c q u i r e revenues to accommodate new developments and growth, t h i s c l a u s e e f f e c t i v e l y e l i m i -nates the o p p o r t u n i t y of a c q u i r i n g revenues to o f f s e t the co s t s of p r o v i d i n g other s e r v i c e s and f a c i l i t i e s which are not enumerated t h e r e i n , but which, can be argued, are c r e a t e d by new developments. Costs which are a s s o c i a t e d w i t h b u i l d i n g 104 new f i r e h a l l s , a d d i t i o n s to p o l i c i n g s t a f f , added e d u c a t i o n a l requirements and other such c o s t s which were d e t a i l e d i n Chapter Three, a p p a r e n t l y cannot be recovered through these charges and t h e r e f o r e must be a c q u i r e d through o t h e r means, such as the development c o n t r a c t . * Another aspect of the l e g i s l a t i o n which c o u l d be c o n s i d e r e d as a disadvantage i s the draftsmanship. Some of the wording and c l a u s e s i n t h i s p a r t i c u l a r s e c t i o n are ambiguous and c o u l d p l a c e the m u n i c i p a l i t y i n the p o s i t i o n of f a c i n g c o u r t a c t i o n . At the very l e a s t , the ambiguity makes the task of composing a development c o s t charge by-law - which w i l l be a c c e p t a b l e to the Inspector of M u n i c i -p a l i t i e s - more d i f f i c u l t . Some examples of t h i s ambiguity are: (1) although Sub-Section (4) s t a t e s t h a t "development c o s t charges may be imposed . . . f o r the s o l e purpose of p r o v i d i n g funds to a s s i s t the m u n i c i p a l i t y " , i t does not s p e c i f y the ext e n t to which a developer can be expected to " a s s i s t " the m u n i c i p a l i t y ; (2) t h i s s u b - s e c t i o n goes on f u r t h e r to s t a t e t h a t these charges are to be a p p l i e d , i n order to d i r e c t l y or i n d i r e c t l y serve the development i n r e s p e c t o f which the charges are imposed, but f a i l s to note how i n d i r e c t " i n d i r e c t l y " r e a l l y i s ; and (3) Sub-Section (6) r e q u i r e s the c o u n c i l to c o n s i d e r whether or not these charges would deter development or would discourage reasonably p r i c e d housing, but does not prevent c o u n c i l from imposing a charge which does e i t h e r . In the case of the l a t t e r , i t may not be very long before some developer a t t a c k s a develop-ment c o s t charge by-law i n the c o u r t s on the ground t h a t 105 c o u n c i l f a i l e d to take those p r i n c i p l e s i n t o c o n s i d e r a t i o n . 5.6 Summary and C o n c l u s i o n s : The M u n i c i p a l Amendment A c t (1977), commonly r e f e r r e d to as " B i l l 42" embodied s i g n i f i c a n t changes to land use c o n t r o l and m u n i c i p a l f i n a n c e i n B r i t i s h Columbia. Of p a r t i c u l a r concern to t h i s study i s the A c t ' s i n f l u e n c e on m u n i c i p a l f i n a n c e . T h i s a c t i n t r o d u c e d the development c o s t charge concept, which, f o r a l l i n t e n t s and purposes, r e p r e s e n t s another form of m u n i c i p a l t a x a t i o n . In e f f e c t , t h i s l e g i s l a t i o n brought about the l e g a l i z a t i o n o f many impost fees p r e v i o u s l y imposed by m u n i c i p a l i t i e s through land use c o n t r a c t s or otherwise. The purpose and p h i l o s o p h y o f the development c o s t charge i s the same as the/commonly accepted purpose and philosophy of the former impost f e e . The fundamental aim of both these concepts i s to d e f a r y the m u n i c i p a l c o s t burdens brought about by new developments by imposing a f i n a n c i a l requirement on those developments t h a t c r e a t e the a d d i t i o n a l c a p i t a l c o s t s . I t i s q u i t e apparent from the h i s t o r i c a l sequence of events, t h a t the development c o s t charge evolved from concern a t the p r o v i n c i a l government l e v e l , to the s o - c a l l e d "housing c r i s i s " . The housing c r i s i s was p e r c e i v e d by the p u b l i c and the p r o v i n c i a l government to be a b a s i c problem of a f f o r d a b i l i t y , with many b e l i e v i n g t h a t l a r g e s e c t i o n s of s o c i e t y were not f u l l y e n j o y i n g the b e n e f i t s of the more 106 g eneral improvement i n the q u a l i t y and q u a n t i t y of housing due to t h e i r i n a b i l i t y to keep pace w i t h the r i s i n g p r i c e s . In attempts to s o l v e t h i s problem, the p r o v i n c i a l government, i n a d d i t i o n to c r e a t i n g an abundance of new housing programs, e s t a b l i s h e d the J o i n t Committee on Housing. The main mandate of t h i s Committee was to enquire i n t o the problems a f f e c t i n g the d e l i v e r y of housing and make recommendations which c o u l d be t r a n s l a t e d i n t o p r o v i n c i a l p o l i c y and l e g i s l a t i o n . The f i n d i n g s of t h i s Committee were presented i n a r e p o r t which became commonly r e f e r r e d to as "The Bawlf Report". The major f i n d i n g of t h i s Committee was t h a t " c h i e f among the u n d e r l y i n g problems a f f e c t i n g the d e l i v e r y of housing were a number of f a c t o r s i n the system of govern-ment c o n t r o l s over p l a n n i n g , s e r v i c i n g and development of housing which unduly c o n s t r a i n e d the p r o d u c t i o n p r o c e s s " . In r e p o r t i n g t h i s f i n d i n g , the Committee a l s o made some 30 recommendations i n an attempt to a m e l i o r a t e t h i s s i t u a t i o n . Among the 30 recommendations, the Committee made three - the p r i n c i p l e s of which were adopted by the p r o v i n c i a l government and i n c o r p o r a t e d i n t o the M u n i c i p a l A c t - which has had s i g n i f i c a n t impact on the m u n i c i p a l i t i e s ' r o l e i n l a n d use c o n t r o l and f i n a n c e . The three recommendations were: (1) the e l i m i n a t i o n of the l a n d use c o n t r a c t p r o -v i s i o n s of the M u n i c i p a l Act; (2) the i n c o r p o r a t i o n of the development permit system i n t o the Act; and (3) the i n t r o -d u c t i o n of o f f - s i t e s e r v i c i n g charges, which l a t e r became 107 known as development c o s t charges. I t i s c l e a r l y e v i d e n t from the Bawlf Report, and the subsequent adoption o f the three recommendations t h a t the new l e g i s l a t i o n was being t a i l o r e d to prevent the i n c o n -s i s t e n c i e s which o c c u r r e d i n c o n j u n c t i o n w i t h the l a n d use c o n t r a c t p r o v i s i o n of the M u n i c i p a l A c t . Evidence from the Bawlf Report a l s o showed the p r o v i n c i a l government's concern was t h a t l a n d use c o n t r a c t s were sometimes being used to r e q u i r e e x c e s s i v e l y h i g h standards o f s e r v i c e s from developers and was unduly i n c r e a s i n g the c o s t o f housing. However, wh i l e having t h i s concern, i t would a l s o appear t h a t the p r o v i n c i a l government was sympathetic towards the mu n i c i -p a l i t i e s 1 f i n a n c i a l predicament i n terms of a c q u i r i n g revenues to pay f o r the c a p i t a l c o s t s of s e r v i c i n g new developments. By a c c e p t i n g the recommendations of the Bawlf Report, the p r o v i n c i a l government e l i m i n a t e d the land use c o n t r a c t p r o v i s i o n o f the M u n i c i p a l A c t and c r e a t e d a new system by which m u n i c i p a l i t i e s c o u l d a c q u i r e the necessary revenues, but under s p e c i f i c c o n d i t i o n s and r e g u l a t i o n s , as s p e c i f i e d i n the e n a b l i n g l e g i s l a t i o n ( i . e . , M u n i c i p a l A c t , S e c t i o n 702C). T h i s grant o f l e g i s l a t i v e power, however, ' does not r e p r e s e n t the onl y means a v a i l a b l e to the municipa-l i t y to a c q u i r e s p e c i f i c revenues from d e v e l o p e r s . Through the use of t h e i r a d m i n i s t r a t i v e powers, m u n i c i p a l i t i e s can c o n t r a c t with developers to have them p r o v i d e c e r t a i n revenues i n exchange f o r some form o f m u n i c i p a l c o n s i d e r a t i o n . Both means can be used to accomplish the same purpose. In most i n s t a n c e s , the development c o s t charge l e g i s l a t i o n simply 108 p r o v i d e s a more d i r e c t and uniform method of a c q u i r i n g these revenues. Although there are s e v e r a l shortcomings i n h e r e n t i n the l e g i s l a t i o n governing development c o s t charges, the survey conducted i n J u l y of 1979 shows t h a t many l o c a l i t i e s have a l r e a d y taken advantage of t h i s new instrument. At the time of the survey, 19 l o c a l i t i e s had submitted and r e c e i v e d approval f o r t h e i r development c o s t charge by-laws. Of the m u n i c i p a l i t i e s which are now l e v y i n g these charges, a l a r g e p r o p o r t i o n of them had p r e v i o u s l y imposed impost f e e s . I n d i c a t i o n s show t h a t more l o c a l i t i e s - i n c l u d i n g those which had imposts and have not y e t a p p l i e d f o r approval and those which d i d not have imposts - w i l l adopt t h i s p r a c t i c e i n the near f u t u r e . From the number of l o c a l i t i e s which have a l r e a d y r e c e i v e d approval to adopt development c o s t charge by-laws and the number expected to make a p p l i c a t i o n f o r a p p r o v a l , i t would appear t h a t t h i s l e g i s l a t i o n has been f a v o u r a b l y r e c e i v e d by the m u n i c i p a l i t i e s . S i m i l a r i l y , from the l a c k of any o r g a n i z e d d i s s e n s i o n thus f a r , from the development i n d u s t r y , would i n d i c a t e t h a t , g e n e r a l l y , t h i s s e c t o r has been amenable to the l e g i s l a t i o n a l s o . These two f a c t o r s alone, r e f l e c t the m e r i t s and p o s i t i v e nature of t h i s l e g i s l a t i o n . 109 CHAPTER SIX  SUMMARY AND CONCLUSIONS 6.1 Summary: At the o u t s e t of t h i s study, i t was noted t h a t there has been l i t t l e documentation or i n f o r m a t i o n on impost fees and development c o s t charges which have been r e a d i l y a v a i l a b l e to the p u b l i c . As a r e s u l t , there are many people who do not f u l l y comprehend the concepts, l e t alone t h e i r purposes, the circumstances causing t h e i r e v o l u t i o n , and o t h e r r e l a t e d i n t r i c a c i e s r e l a t i n g t o t h e i r use. T h i s lack of understanding has c o n t r i b u t e d to the v a s t a r r a y of c r i t i c i s m i n o p p o s i t i o n to the two concepts, but i n p a r t i c u l a r , the impost fee. T h i s study was undertaken to pr o v i d e f a c t u a l i n f o r m a t i o n r e l a t i n g to both the impost fee and the develop-ment c o s t charge, w i t h the aim of e s t a b l i s h i n g a b e t t e r understanding o f these concepts. In t h i s r egard, f o u r o b j e c t i v e s of the study were enumerated i n the i n t r o d u c t o r y pages: 1. to determine and d i s c u s s some of the major f a c t o r s and events which prompted the m u n i c i p a l i t i e s i n B r i t i s h Columbia to c o n s i d e r and adopt the l e v y i n g of impost f e e s ; 2. to c l a r i f y the philosophy and implementation s t r a t e g i e s of the impost fee concept and determine the extent of i t s use i n B r i t i s h Columbia p r i o r to the advent 110 of the development c o s t charge l e g i s l a t i o n ; 3. to determine and d i s c u s s some of the major f a c t o r s and events which prompted the p r o v i n c i a l government to a b o l i s h impost fees and i n t r o d u c e development c o s t charges; and, 4. to examine and s y n t h e s i z e the development c o s t charge l e g i s l a t i o n to determine i t s p h i l o s o p h y , purpose and the requirements p r o v i d e d t h e r e i n , as w e l l as to determine the ext e n t o f i t s c u r r e n t use i n the pr o v i n c e . The i n f o r m a t i o n r e q u i r e d to s a t i s f y these o b j e c -t i v e s was a c q u i r e d through i n t e r v i e w s , two surveys and a review of the l i m i t e d amount of a v a i l a b l e i n f o r m a t i o n . Statement One: A review of the l i t e r a t u r e as w e l l as comments from i n t e r v i e w s suggested t h a t a number of f a c t o r s and events c o n t r i b u t e d to the e v o l u t i o n of the impost fee i n B r i t i s h Columbia. I t i s p r e c e i v e d t h a t some m u n i c i p a l i t i e s began to search out new sources of revenue d u r i n g the l a t t e r p a r t of the 1950's and the 1960's because of s e r i o u s f i n a n c i a l s t r a i n s . The main c o n t e n t i o n o f these munici-p a l i t i e s was t h a t t h e i r primary sources of revenue - namely prop e r t y t a x a t i o n and p r o v i n c i a l a s s i s t a n c e - d i d not have the f l e x i b i l i t y of gen e r a t i n g s u f f i c i e n t revenue to o f f s e t the i n c r e a s i n g demands f o r m u n i c i p a l s e r v i c e s and a c t i -v i t i e s . I l l A review o f the m u n i c i p a l e x p e n d i t u r e s , i n Chapter Three, r e v e a l e d s e v e r a l other f a c t o r s which c r e a t e d f i n a n c i a l problems f o r the m u n i c i p a l i t i e s and which, i t would appear, were i n f l u e n t i a l i n the mu n i c i p a l d e c i s i o n to seek a l t e r n a t e sources o f revenue. These f a c t o r s were: (1) p o p u l a t i o n growth and the concurrent expansion of the urban areas; (2) r i s i n g a s p i r a t i o n s of the p u b l i c ; and (3) a d d i t i o n a l f i n a n c i a l commitments towards o b l i g a t o r y f u n c t i o n s . Of the three f a c t o r s l i s t e d above, p o p u l a t i o n growth had the g r e a t e s t impact on l o c a l f i n a n c i a l r e s o u r c e s . With many l o c a l i t i e s i n B r i t i s h Columbia e x p e r i e n c i n g popu-l a t i o n growth r a t e s i n excess of 100 per cent i n a p e r i o d of 20 y e a r s , the f i n a n c i a l i m p l i c a t i o n s of accommodating the growth was a very r e a l and p e r p l e x i n g problem f o r the m u n i c i p a l i t i e s . Not only was there a need to expand or c o n s t r u c t primary i n f r a s t r u c t u r e - such as roadways, sewer f a c i l i t i e s and water s u p p l i e s - to serve the newly developing areas, but there was a l s o a need to expand the s o c i a l o r i e n t e d s e r v i c e s - such as park and r e c r e a t i o n a l f a c i l i t i e s - as w e l l as the p r o t e c t i v e s e r v i c e s - such as p o l i c e and f i r e p r o t e c t i o n . As a r e s u l t of p o p u l a t i o n growth, some m u n i c i p a l i -t i e s began to i n v e s t i g a t e and develop s t r a t e g i e s which would help to a l l e v i a t e the c o s t burdens of s u p p l y i n g a v a r i e t y of m u n i c i p a l l y procured s e r v i c e s to the developing areas. The impost fee was i n t r o d u c e d i n t o the p r o v i n c e , 112 by the M u n i c i p a l i t y of Richmond i n the e a r l y 1960's, as one of these s t r a t e g i e s . In e f f e c t , i t was a c u l m i n a t i o n of s e v e r a l m u n i c i p a l techniques - such as the use of zoning to manage growth and the use of s u b d i v i s i o n c o n t r o l by-laws to r e q u i r e developers to p r o v i d e more and h i g h e r standards of s u b d i v i s i o n s e r v i c e s - to o f f s e t the f i n a n c i a l i m p l i c a t i o n s a s s o c i a t e d w i t h growth. Statement Two: The r e s u l t s of the survey conducted i n 19 77 and comments from i n t e r v i e w s i n d i c a t e d t h a t the commonly accepted d e f i n i t i o n of an impost fee was: a l e v y which i s assessed a g a i n s t a developer by a m u n i c i p a l i t y to d e f r a y the m u n i c i p a l c o s t s of c o n s t r u c t i n g or expanding s e r v i c e s n e c e s s i t a t e d by new developments. I t was p e r c e i v e d t h a t the b a s i c i n t e n t of the impost fee was to meet the demand and c o s t s f o r new and improved s e r v i c e s by imposing a f i n a n c i a l requirement on those lands t h a t c r e a t e d the demand. I t was a l s o g e n e r a l l y agreed t h a t the impost fee d i d not apply to o n - s i t e c o s t s . These c o s t s , such as f o r c o n s t r u c t i n g or improving roadways or i n s t a l l i n g a sewer or water s e r v i c e i n t o a development, were g e n e r a l l y borne by the developer i n any case, and d i d not form p a r t of the impost fe e . Impost fees were a p p l i e d to recover c o s t s t h a t o c c u r r e d on a f a i r l y l a r g e s c a l e . For example, they were used to a c q u i r e revenues f o r the upgrading of a r t e r i a l roads, the c o n s t r u c t i o n o r improvement of water supply 113 and d i s t r i b u t i o n f a c i l i t i e s , sewage c o l l e c t i o n Nand t r e a t -ment systems, and other s i m i l a r works. The r e s u l t s from the q u e s t i o n n a i r e conducted i n 1977 showed t h a t from the e a r l y 1960's to the time of the survey, a v a r i e t y o f implementation techniques were used to l e v y imposts. I t was found t h a t these fees were a c q u i r e d through such means as: (1) development or s e r v i c i n g agree-ments, (2) a c o n d i t i o n of s u b d i v i s i o n a p p r o v a l , (3) a con-d i t i o n of rezo n i n g a p p r o v a l , (4) a c o n d i t i o n of b u i l d i n g permit i s s u a n c e , and (5) land use c o n t r a c t s . A review of the l e g a l nature of each of these methodologies r e v e a l e d t h a t the former ( i . e . , development c o n t r a c t s ) and the l a t t e r ( i . e . , land use c o n t r a c t s ) were the on l y means s p e c i f i c a l l y s a n c tioned by the p r o v i n c i a l l e g i s l a t u r e through which the m u n i c i p a l i t y c o u l d a c q u i r e these f e e s , i n t r a v i r e s . The 1977 q u e s t i o n n a i r e a l s o showed t h a t a number of m u n i c i p a l i t i e s i n B r i t i s h Columbia had adopted and were u t i l i z i n g the impost fee concept. The r e s u l t s r e v e a l e d t h a t of the 36 l o c a l i t i e s which were surveyed, 21 or 58 per cent of these l o c a l i t i e s were a p p l y i n g impost f e e s . The use of the impost fee was evenly d i s t r i b u t e d among m u n i c i p a l d i s t r i c t s and m u n i c i p a l i t i e s , with 11 of /the former and ten of the l a t t e r l e v y i n g these charges, r e s p e c t i v e l y . The amount of the impost f e e , f o r s p e c i f i c types of developments, v a r i e d widely from community to community. I t was f e l t t h a t r e g i o n a l d i f f e r e n c e s i n s e r v i c i n g c o s t s and 114 the v a r i a t i o n i n m u n i c i p a l f i n a n c i a l needs and c o n v i c t i o n s c o n t r i b u t e d , to a l a r g e extent, to t h i s wide range. The l a c k of guidance, d i r e c t i o n and l e g i s l a t i o n from the pro-v i n c i a l a u t h o r i t i e s was a l s o f e l t to be an e q u a l l y important c o n t r i b u t o r . Statement Three: A review of the l i t e r a t u r e and the h i s t o r i c a l sequence of events suggested t h a t the p r o v i n c i a l government's concern f o r the s o - c a l l e d "housing c r i s i s " l e d , e v e n t u a l l y , to the a b o l i t i o n of the impost fee and the c r e a t i o n of the development c o s t charge. Research showed t h a t the r e p o r t from the J o i n t Committee on Housing - which was c r e a t e d to enquire i n t o the problems a f f e c t i n g the d e l i v e r y of housing - was i n s t r u m e n t a l i n the government's d e c i s i o n to i n t r o d u c e l e g i s l a t i o n which, among other t h i n g s , r e p e a l e d the l a n d use c o n t r a c t p r o v i s i o n of the M u n i c i p a l Act and brought about the r e g u l a t i o n f o r a new form of m u n i c i p a l t a x a t i o n . I t i s c l e a r l y e v i d e n t from the r e p o r t and the subsequent amendments to the M u n i c i p a l Act t h a t the pro-v i n c i a l government f e l t land use c o n t r a c t s c o n t r i b u t e d to i n c o n s i s t e n c i e s i n the development approval p r o c e s s , were being used by some m u n i c i p a l i t i e s to r e q u i r e e x c e s s i v e l y high standards from developers, and was unduly i n c r e a s i n g the c o s t of housing. They, t h e r e f o r e , r e p e a l e d t h i s p r o-v i s i o n , and - being sympathetic towards the m u n i c i p a l i t i e s ' 115 f i n a n c i a l predicament i n terms of a c q u i r i n g revenues to pay f o r the c o s t s of s e r v i c i n g new developments - i n t r o d u c e d the development c o s t charge l e g i s l a t i o n . Statement Four: Based on i n f o r m a t i o n from i n t e r v i e w s with v a r i o u s o f f i c i a l s from the M i n i s t r y of M u n i c i p a l A f f a i r s and a review of the most r e c e n t l i t e r a t u r e r e q a r d i n g the new l e g i s l a t i o n , i t i s apparent t h a t the p r o v i n c i a l government's philosophy behind the development c o s t charge p r o v i s i o n was to make the l e g i s l a t i o n r e g u l a t o r y , uniform and t a x i n g . A n c i l l a r y to t h i s , " c e r t a i n t y " was to be r e i n s t a t e d i n the development process w i t h the l e g i s l a t i o n c a l l i n g f o r a l l the major f a c t o r s of development to be known a t the o u t s e t . I t was found t h a t t h i s p h i l o s o p h y was i n keeping with the other l e g i s l a t i v e amendments which the p r o v i n c i a l government i n t r o d u c e d a t the same time. The purpose of the development c o s t charge, as d e t a i l e d i n S e c t i o n 702C of the M u n i c i p a l Act, i s b a s i c a l l y the same as the commonly accepted purpose of the impost fee; t h a t being to d e f r a y the m u n i c i p a l c o s t burdens brought about by new developments by imposing a f i n a n c i a l requirement on those developments t h a t c r e a t e the a d d i t i o n a l c a p i t a l c o s t s . S e c t i o n 702C grants the m u n i c i p a l i t i e s the l e g i s l a t i v e power to a c q u i r e s p e c i f i c revenues, through s p e c i f i c means and under s p e c i f i c c o n d i t i o n s . The under-l y i n g b a s i s , i s t h a t , the p r o v i n c i a l government i n g r a n t i n g 116 these powers, has r e t a i n e d a c o n s i d e r a b l e amount of d i s -c r e t i o n over the use of such power. That would account f o r the number of r e s t r i c t i o n s i n h e r e n t i n the l e g i s l a t i o n and the requirements which the m u n i c i p a l i t i e s must s a t i s f y p r i o r to the enactment of development c o s t charge by-laws. Unbeknown to many people, and p o s s i b l y i n c l u d i n g the p r o v i n c i a l government, i s t h a t S e c t i o n 702C does not r e p r e s e n t the o n l y means a v a i l a b l e to the m u n i c i p a l i t y to a c q u i r e s p e c i f i c revenues from d e v e l o p e r s . By e x e r c i s i n g t h e i r a d m i n i s t r a t i v e power, m u n i c i p a l i t i e s can enter agree-ments with developers and c o n t r a c t with them to p r o v i d e revenues to be used i n much the same manner as development c o s t charges. In most i n s t a n c e s , the development c o s t charge l e g i s l a t i o n simply p r o v i d e s a more d i r e c t and uniform method of a c q u i r i n g these revenues. From the r e s u l t s of the survey which was conducted i n J u l y 1979, i t would appear t h a t many l o c a l i t i e s have alre a d y taken advantage of t h i s new l e g i s l a t i o n . I t was found t h a t the Inspector of M u n i c i p a l i t i e s had approved 19 development c o s t charge by-laws and s e v e r a l amendments to same. The survey a l s o showed t h a t s e v e r a l o t h e r l o c a l i -t i e s were i n the process of adopting the p r a c t i c e , which r e f l e c t the r e l a t i v e m e r i t and p o s i t i v e nature of t h i s l e g i s -l a t i o n . 6.2 C o n c l u s i o n s : The r e c e n t i n c o r p o r a t i o n of the development c o s t 117 charge p r o v i s i o n i n t o the M u n i c i p a l A c t embodies s i g n i f i c a n t changes to l o c a l government f i n a n c e . T h i s l e g i s l a t i o n w i l l undoubtedly a s s i s t the l o c a l governments i n B r i t i s h Columbia to reduce some of the f i n a n c i a l s t r a i n and impact brought about by urban p o p u l a t i o n growth. The f a c t t h a t t h i s l e g i s -l a t i o n r e p r e s e n t s another form of m u n i c i p a l t a x a t i o n s p e c i -f i c a l l y enacted f o r t h i s purpose, i s a p r o g r e s s i v e step i n the d i r e c t i o n o f a i d i n g m u n i c i p a l i t i e s to improve t h e i r f i n a n c i a l s i t u a t i o n . The f a c t t h a t t h i s study has r e v e a l e d t h a t m u n i c i -p a l i t i e s , u s i n g t h e i r a d m i n i s t r a t i v e powers, are able to enter the realm o f c o n t r a c t u a l n e g o t i a t i o n s - having s i m i l a r a f f e c t as the past l a n d use c o n t r a c t p r o v i s i o n of the M u n i c i p a l A c t - b r i n g s up a s e r i o u s i m p l i c a t i o n r e l a t i n g to the development c o s t charge l e g i s l a t i o n . As t h i s power to enter c o n t r a c t s g i v e s m u n i c i p a l i t i e s a g r e a t d e a l o f f l e x i b i l i t y and freedom i n the development and s u b d i v i s i o n approval process, i t c o u l d c o n c e i v a b l y be used to abrogate the i n t e n t and philosophy of the new l e g i s l a t i o n . As has been noted p r e v i o u s l y , i t i s c l e a r l y e v i d e n t t h a t the p r o v i n c i a l government's philosophy behind the development c o s t charge p r o v i s i o n was to make the l e g i s l a t i o n r e g u l a t o r y , uniform and t a x i n g , r a t h e r than c o n t r a c t u a l on the b a s i s o f i n d i v i d u a l n e g o t i a t i o n . The l e g i s l a t i o n can be seen as a means of p r o v i d i n g m u n i c i p a l i t i e s with the l e g i s l a t i v e power necessary to a c q u i r e s p e c i f i c revenues -to o f f s e t i t s c o s t s of s e r v i c i n g new development areas -118 through s p e c i f i c means and under s p e c i f i c c o n d i t i o n s . The u n d e r l y i n g b a s i s , being t h a t the p r o v i n c i a l government, i n g r a n t i n g these powers has r e t a i n e d a c o n s i d e r a b l e amount of d i s c r e t i o n over the use of such power. In e f f e c t , by using t h e i r a d m i n i s t r a t i v e power as an a l t e r n a t e means of a c q u i r i n g revenues from developers - or any other c o n s i d e r a t i o n which can be n e g o t i a t e d i n the c o n t r a c t - m u n i c i p a l i t i e s c o u l d c r e a t e much the same type of s i t u a t i o n as e x i s t e d p r i o r to the enactment of " B i l l 42". I n c o n s i s t e n c i e s , delays and o t h e r problems which prompted the p r o v i n c i a l government to r e p e a l the l a n d use c o n t r a c t p r o v i s i o n of the M u n i c i p a l Act, c o u l d occur and d e f e a t the whole purpose o f the new l e g i s l a t i o n . Although i t i s hoped t h a t many, i f not most, m u n i c i p a l i t i e s w i l l r e s p e c t the p r o v i n c i a l government's i n t e n t i n e n a c t i n g the development c o s t charge p r o v i s i o n , u n f o r t u n a t e l y , the o p p o r t u n i t y to abrogate t h i s l e g i s l a t i o n does e x i s t . The onus i s on the m u n i c i p a l i t i e s to use t h e i r a d m i n i s t r a t i v e and l e g i s l a t i v e powers i n a j u s t and respon-s i b l e manner f o r the purposes they were intended. I f muni-c i p a l i t i e s do t h e i r utmost to c a r r y out the s p i r i t and i n t e n t of the new l e g i s l a t i o n , the u l t i m a t e l y hoped f o r r e s u l t of g r e a t e r c e r t a i n t y w i l l probably prove j u s t as popular w i t h them as i t i s intended to prove with most de v e l o p e r s . 6.3 Suggestions f o r F u r t h e r Research: From the o u t s e t , the p r e s e n t study was intended to 119 be an e x p l o r a t o r y i n v e s t i g a t i o n i n t o impost fees and develop-ment c o s t charges i n B r i t i s h Columbia. I t was r e a l i z e d t h a t a t o t a l comprehensive study of the s u b j e c t matter c o u l d not be accomplished w i t h i n the l i m i t e d time a v a i l a b l e . As such, there are s e v e r a l areas of r e s e a r c h which were beyond the scope of t h i s study. I t i s hoped t h a t the i n f o r m a t i o n presented h e r e i n w i l l serve as a p i l o t i n v e s t i g a t i o n f o r more in-depth s t u d i e s i n the near f u t u r e . Having completed the r e s e a r c h necessary to s a t i s f y the o b j e c t i v e s enunciated i n the i n t r o d u c t o r y pages, s e v e r a l suggestions can be made as to the d i r e c t i o n i n which f u r t h e r r e s e a r c h should be c h a n n e l l e d . S i g n i f i c a n t l y , a more com-prehensive examination of the i m p l i c a t i o n s of l e v i e s such as the impost fee and development c o s t charge would be d e s i r a b l e . Of p a r t i c u l a r m e r i t would be s t u d i e s which i n v e s t i g a t e the e f f e c t s of these types of surcharges on development i n g e n e r a l . S e v e r a l unanswered que s t i o n s come to mind: Did those muni-c i p a l i t i e s , which a p p l i e d impost f e e s , experience any s i g -n i f i c a n t decrease i n the amount of development because of such fees? I f so, what are the s h o r t and long term f i n a n c i a l i m p l i c a t i o n s a s s o c i a t e d with the decrease? F u r t h e r , the s i g n i f i c a n c e of the development c o s t charge to m u n i c i p a l revenue would a l s o be advantageous. Another i s s u e r e q u i r i n g a d d i t i o n a l r e s e a r c h i s t h a t of determining the e f f e c t these types of fees have on the p r i c e of housing. An i n v e s t i g a t i o n i n t o t h i s aspect would be very u s e f u l i n e v a l u a t i n g the m e r i t s and demerits 120 of such f e e s . I f f u r t h e r r e s e a r c h were to i n d i c a t e t h a t development c o s t charges s i g n i f i c a n t l y i n c r e a s e s the p r i c e of housing, a major review of the c o s t s and b e n e f i t s and the f u t u r e prospects of t h i s instrument might be i n o r d e r . Although development c o n t r a c t s and the m u n i c i p a l i -t i e s ' use of i t s a d m i n i s t r a t i v e power to achieve s i m i l a r purposes as the development c o s t charge has been d i s c u s s e d i n t h i s study, due to the scope of t h i s study, r e s e a r c h i n t o the f u l l p o t e n t i a l of t h i s power was not p o s s i b l e . The f a c t t h a t the use of a d m i n i s t r a t i v e power allows a m u n i c i p a l i t y to enter c o n t r a c t s would suggest t h a t a v a s t a r r a y of muni-c i p a l o b j e c t i v e s c o u l d be achieved i n t h i s way. F u r t h e r r e s e a r c h i n t o the p o s s i b l e uses of t h i s power would d e f i n i t e l y be an a s s e t to m u n i c i p a l government. 6.4 I m p l i c a t i o n s f o r P l a n n i n g : T h i s c u r r e n t study has three major i m p l i c a t i o n s f o r p l a n n i n g . F i r s t l y , i f t h i s study achieves one of the prime purposes f o r which i t was undertaken - t h a t being to impart a b e t t e r understanding of the p h i l o s o p h y , i n t e n t and h i s t o r i c a l e v o l u t i o n of impost fees and development charges - i t should reduce the adverse c r i t i c i s m s and stigma a s s o c i a t e d with such f e e s . With p u b l i c awareness and support, f i n a n c i a l p l a n n i n g f o r growth i s apt to be c o n s i d e r a b l y more s u c c e s s f u l . Secondly, the i n f o r m a t i o n presented h e r e i n p r o v i d e s the m u n i c i p a l i t i e s , themselves, w i t h the o p p o r t u n i t y o f , perhaps, g a i n i n g a b e t t e r i n s i g h t i n t o the e v o l u t i o n of the 121 concepts so they w i l l be able to a p p r e c i a t e and do t h e i r b e s t to c a r r y out the s p i r i t and i n t e n t of the new l e g i s -l a t i o n . F u r t h e r , the appendix i n f o r m a t i o n p e r t a i n i n g s p e c i f i c a l l y to the c a l c u l a t i o n o f development c o s t charges and the suggestions r e l a t i n g to some of the c o n s i d e r a t i o n s and c a u t i o n s r e g a r d i n g the d r a f t i n g of the by-laws should prove to be advantageous f o r those m u n i c i p a l planners who may become i n v o l v e d with t h i s concept. F i n a l l y , and p o s s i b l y the most s i g n i f i c a n t i m p l i -c a t i o n d e r i v e d from t h i s study, i s t h a t , m u n i c i p a l i t i e s do not have to r e l y on the development c o s t charge l e g i s l a t i o n as the o n l y means to a c q u i r e revenues from d e v e l o p e r s . The study r e v e a l e d t h a t by e x e r c i s i n g t h e i r a d m i n i s t r a t i v e power, m u n i c i p a l i t i e s can enter agreements with developers and c o n t r a c t with them to p r o v i d e e i t h e r revenues to be used f o r any purpose the m u n i c i p a l i t y chooses, o r , any other con-s i d e r a t i o n which can be n e g o t i a t e d i n t o the c o n t r a c t . 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Crawford, K.G.; Canadian M u n i c i p a l Government; Toronto: The U n i v e r s i t y of Toronto Press; 1954. Dawson, R.M.; The Government of Canada; Toronto: U n i v e r s i t y of Toronto Press; 1963. 125 D e l t a , M u n i c i p a l i t y o f ; "Report on Development Charges"; D e l t a : unpublished; 1974. Feldman, L.D. and G o l d r i c k , M.D. (eds.); P o l i t i c s and Government of Urban Canada: S e l e c t e d Readings; Toronto: Methuen P u b l i c a t i o n s ; 19 69. Gleeson, M.E.; B a l l , I.T.; Chin, S.P.; E i n s w e i l e r , R.C.; F r e i l i c h , R.H.; and Meagher, P.; Urban Growth  Management Systems: An E v a l u a t i o n of P o l i c y - Related Research; Chicago: The American S o c i e t y of P l a n n i n g O f f i c i a l s ; 1975. Hickey, P.; "The Changing S t r u c t u r e of M u n i c i p a l Governments i n Canada"; M u n i c i p a l Finance and A d m i n i s t r a t i o n  i n Canada; Toronto: The Canadian I n s t i t u t e of Chartered Accountants; 19 72. I s a r d , W. and Coughlin, R.; M u n i c i p a l Costs and Revenues R e s u l t i n g From Community Growth; Massachusettes: U n i v e r s i t y of Pennsylvania; 1957. Housing and Urban Development A s s o c i a t i o n of Canada; "A B r i e f Presented to the J o i n t Committee on Housing"; Burnaby: unpublished; 1976. J a n i s , J . ; "Impact Taxes: U n f a i r Good I n t e n t i o n s A s i d e " ; Management and C o n t r o l of Growth, V o l . I; Ed. R.W. S c o t t ; Washington, D.C.: The Urban Land I n s t i t u t e ; 1975. J o i n t Committee of the American P u b l i c Works A s s o c i a t i o n , the American S o c i e t y of C i v i l Engineers and the Water P o l l u t i o n C o n t r o l F e d e r a t i o n ; F i n a n c i n g and  Charges f o r Wastewater Systems; Chicago: American P u b l i c Works A s s o c i a t i o n ; 1973. J o i n t Committee on Housing; "A Report Prepared f o r the Pro-v i n c e of B r i t i s h Columbia, M i n i s t r y of M u n i c i p a l A f f a i r s and Housing"; V i c t o r i a : unpublished; 1976. Jones, L.D. and U l i n d e r , D.D. (eds.); Real E s t a t e Finance Readings; A C o m p i l i a t i o n of Notes f o r Commerce 309; Vancouver: F a c u l t y of Commerce and Business A d m i n i s t r a t i o n ; The U n i v e r s i t y of B r i t i s h Columbia; 1976. Lane, W.T.; P o r t e r , B.; and Wilson, J.G.; Land Use C o n t r a c t s ; Ed. K.C. Woodsworth; Vancouver: Centre f o r Con-t i n u i n g Education; The U n i v e r s i t y of B r i t i s h Columbia; 1976. at " Langley, C i t y o f ; Development P o l i c y ; Langley: unpublished; 1976. 126 Loewenstein, L.K. and Walters, D.W.; M u n i c i p a l Cost-Revenue  A n a l y s i s f o r Planned U n i t Developments; S p e c i a l Report #9; B e r k l e y : The Centre fOr Real E s t a t e and Urban Economics; I n s t i t u t e o f Urban and Regional Development; U n i v e r s i t y o f C a l i f o r n i a ; 1973. Lorimer, J«; A C i t i z e n ' s Guide to C i t y P o l i t i c s ; Toronto: James Lewis and Samuel; 19 72. Lucas, T.C.; The D i r e c t Costs of Growth; Colorado: The Colorado Land Use Commission; 1975. MacKenzie, R.M.; "Land Use and Development C o n t r o l i n B r i t i s h Columbia"; The Advocat; V o l . 36, P a r t 6; Vancouver: Vancouver Bar A s s o c i a t i o n ; 1978. Mace, R.L. and Wicker, W.J.; "Do S i n g l e Family Homes Pay T h e i r Way?" - A Comparative A n a l y s i s of Costs and  Revenues f o r P u b l i c S e r v i c e s ; Research Monograph #15; Washington, D.C.; The Urban Land I n s t i t u t e ; 1968. Moak, L.L. and H i l l h o u s e , A.M.; Concepts and P r a c t i c e s i n  L o c a l Government Finance; Chicago: M u n i c i p a l Finance O f f i c e r s A s s o c i a t i o n of the United S t a t e s and Canada; 1975. M u l l e r , T.; " F i s c a l Impact: Methods and Issues"; Management  and C o n t r o l o f Growth, V o l . I I ; Ed. R.W. S c o t t ; Washington, D.C.: The Urban Land I n s t i t u t e ; 19 75. O n t a r i o , Province o f ; Regional Government i n P e r s p e c t i v e : A F i n a n c i a l Review; Toronto: M u n i c i p a l Finance Branch, M i n i s t r y o f Treasury, Economics and Intergovernmental A f f a i r s ; 1976. Pearson, N.; "What P r i c e Suburbia?"; New Westminster; Lower Mainland Regional P l a n n i n g Board; 1967. Pennance, F.G.; Hamilton, S.W.; and Baxter; D.; Housing - I t ' s Your Move, V o l s 1 and 2; Vancouver: Hemlock P r i n t e r s L t d . ; 1976. Peterson G.J.; An A n a l y t i c Approach to the P r o v i s i o n o f  F i n a n c i n g of Urban P u b l i c S e r v i c e s i n Suburban  Development Areas; Vancouver; 19 74. P e t t e n g i l , R.B. and Uppal, J.S.; Can C i t i e s S u rvive? The  F i s c a l P l i g h t o f Americim Cltie~s~; New York: St. Martin's Press; 1974. Plan n i n g I n s t i t u t e of B r i t i s h Columbia; "A B r i e f Presented to the J o i n t Committee on Housing"; Vancouver: unpublished; 1976. 127 P l u n k e t t , T.J.; The M u n i c i p a l P i c t u r e i n B r i t i s h Columbia; Vancouver: Union of B r i t i s h Columbia M u n i c i p a l i -t i e s ; 1971. Real E s t a t e Board of Greater Vancouver; "A B r i e f Presented to the J o i n t Committee on Housing"; Vancouver: unpublished; 1976. Real E s t a t e Board of Greater Vancouver; Real E s t a t e Trends  i n M e t r o p o l i t a n Vancouver, 19 76; Vancouver: S t a t i s t i c a l and Survey Committee; Real E s t a t e Board o f Greater Vancouver; 1976. Rogers, I.M.; M u n i c i p a l C o u n c i l l o r s ' Handbook; Second E d i t i o n ; Toronto: The C a r s w e l l Company L i m i t e d ; 1971. Rogers, I.M.; The Law of Canadian M u n i c i p a l C o r p o r a t i o n s , Vols 1 and 2; Toronto: The C a r s w e l l Company L i m i t e d ; 1959. Schaenman, P.S. and M u l l e r , T.; "Land Development: Measuring the Impacts"; Management and C o n t r o l of Growth, V o l . I I ; Ed. R.W. S c o t t ; Washington, D.C.: The Urban Land I n s t i t u t e ; 1975. S c o t t ; R.W. (ed.); Management and C o n t r o l of Growth, V o l s . I,  II and III"; Washington, D.C. : The Urban Land I n s t i t u t e ; 1975. S e l l n e r / J . (ed.); P r i n c i p l e s of By-law W r i t i n g and E n f o r c e - ment; Vancouver: Centre f o r C o n t i n u i n g Education; The U n i v e r s i t y of B r i t i s h Columbia; 197 3. Stanley A s s o c i a t e s (Kamloops) L i m i t e d ; Rate Study (A Report Prepared f o r the C i t y of Kamloops); Kamloops: unpublished; 1975. S t e r n l i e b , G. e t a l ; Housing Development and M u n i c i p a l Costs; New Brunswick, New J e r s e y : Centre f o r Urban P o l i c y Research; Rutgers U n i v e r s i t y ; 1973. Surrey, M u n i c i p a l i t y o f ; Development P o l i c y ; Surrey: unpublished; 1976. Webster's T h i r d New I n t e r n a t i o n a l D i c t i o n a r y ; S p r i n g f i e l d , Massachusetts: G. and C. Merriam Company Pub-l i s h e r s ; C opyright 19 76. 0 APPENDICES 130 Name of Municipality-Please r e t u r n t o : Alan Kuroyama, #305 - 1585 West 11th Ave., Vancouver, B.C. "THE MUNICIPAL CASH IMPOST FEE IN BRITISH COLUMBIA -THE CONCEPT AND THE ISSUES" QUESTIONNAIRE 1. Does your m u n i c i p a l i t y p r e s e n t l y l e v y any type of impost fee or development surcharge? Yes No 2. I f "no", please s t a t e whether your m u n i c i p a l i t y has any i n t e n t i o n s of adopting t h i s type of p o l i c y i n the f u t u r e . Yes (expected date of adoption ) No 3. I f "yes", please c l a r i f y by checking the a p p r o p r i a t e space and s t a t i n g the amount charged: Type of Levy Yes/No Amount of Levy Per U n i t S i n g l e Family Dwelling Duplex M u l t i p l e D e n s i t y M u n i c i p a l A r t e r i a l Roadway Levy M u n i c i p a l Non-A r t e r i a l Roadway Levy Storm Sewer Systems Levy Waterworks Levy A c q u i s i t i o n and/or Development of P u b l i c Lands Levy Others (please s p e c i f y ) T o t a l 131 A d d i t i o n a l Comments and C l a r i f i c a t i o n ( i f n e c e s s a r y ) . Use a d d i t i o n a l sheets i f r e q u i r e d . 4. Please e x p l a i n the means o f implementation ( i . e . , Is the impost fee being l e v i e d i n c o n j u n c t i o n w i t h a Land Use C o n t r a c t ? I f not, what ot h e r procedure i s being used?). Use a d d i t i o n a l sheets i f r e q u i r e d . Have you encountered any problems w i t h the impost fee concept or your means of implementation? Use a d d i t i o n a l sheets i f r e q u i r e d . A d d i t i o n a l Comments. Use a d d i t i o n a l sheets i f r e q u i r e d . APPENDIX 2 TABLE 1: POPULATION, SHOWING NUMERICAL AND PERCENTAGE CHANGES FOR CANADA AND BRITISH COLUMBIA - 1901-1971 1901 1911 1921 1931 1941 1951 1961 • 1971 Canada 5,371,315 ( 11.1%) 7,206,643 ( 34.2%) 8 ,787,949 ( 21.9%) 10,376,786 ( 18.1%) 11,506,655 ( 10.9%) 14,009,429 ( 21.8%) 18,238,247 ( 30.2%) 21,568,311 ( 18.3%) : B r i t i s h Columbia 178,657 ( 82.0%) 392,480 (119.7%) 524 ,582 ( 33.7%) 694,263 ( 32.3%) 817,861 ( 17.8%) 1,165,210 ( 42.5%) 1,629,082 ( 39.8%) 2,184,621 ( 34.1%) TABLE 2: POPULATION, SHOWING NUMERICAL AND PERCENTAGE CHANGES FOR MAJOR LOCALITIES IN BRITISH COLUMBIA - 1951-1971 L o c a l i t y 1951 1971 % Change L o c a l i t y 1951 1971 % Change Burnaby 58,376 125,660 115.3% Port Coquitlam 3,232 19,560 505.2% Crahbrook 3,621 12,000 231.4% P r i n c e George 4,703 33,101 603.8% Kelowna 8,517 19,412 127.9% Richmond 19,186 62 ,121 223.8% Nanaimo 7,196 14,948 107.7% Saanich 28,481 65,040 128.4% Surrey 33,670 98,601 192.8% 135 development permits which may r e q u i r e c e r t a i n works t o be c a r r i e d out (see 7 0 2 A A ( 2 ) ( b ) ( c ) ( d ) ) . S i m i l a r l y the c o u n c i l may e x e r c i s e i t s r e g u l a t o r y power under S e c t i o n 702C by imposing development c o s t charges on every person who o b t a i n s s u b d i v i s i o n a p p r o v a l . These r e g u l a t o r y powers o f a m u n i c i p a l i t y must, of course, be e x e r c i s e d by bylaw. They are p a r t o f the l e g i s l a t i v e or law making f u n c t i o n of l o c a l government. Among them i s the r i g h t t o pass bylaws under s u b s e c t i o n 702 (zoning), 702AA (development p e r m i t s ) , 702C (development charges) , ?.and 711(1) (d) (e) (f) (g) ( s u b d i v i s i o n s e r v i c e s ) . U n f o r t u n a t e l y , because these s e c t i o n s of the M u n i c i p a l A c t d e a l i n such d e t a i l w i t h development charges and s u b d i v i s i o n s e r v i c e s , many have assumed ( i n my mind erroneously) t h a t . t h e s e enumerated l e g i s l a t i v e powers r e p r e s e n t the onl y a u t h o r i t y f o r a m u n i c i p a l i t y t o o b t a i n p u b l i c works from a developer. The r i g h t of a m u n i c i p a l i t y t o enter a c o n t r a c t i s among the m u n i c i p a l i t y ' s "housekeeping" (not l e g i s l a t i v e ) powers. Richmond entered development c o n t r a c t s w i t h i t s developers under .the s p e c i f i c "housekeeping powers" which c o u n c i l had under the M u n i c i p a l A c t . Far;':from being "never s a n c t i o n e d -by l e g i s l a t i o n " the powers were c l e a r l y s e t f o r t h i n a v a r i e t y of p l a c e s . HEADS OF AGREEMENTIIN A TYPICAL Rl Contractual Obligation of the Municipality To permit the developer to carry out the "works" upon the terms and conditions i n the. development contract: (a) p a r t l y on land.owned or controlled by the developer, for which rig h t s -of-way would be granted to the municipality, and IHMOND DEVELOPMENT CONTRACT (1960's) Municipal Authority and Comments (References are to the Municipal Act) -See below, comments opposite "To accept the systems — " -S.17 gives municipalities " f u l l power to acquire by purchase, lease or other-wise r e a l property". -Division (1) of Part XII also-provides the authority to acquire r e a l property ( p a r t i c u l a r l y S.464 and S.466). -S.531 s p e c i f i c a l l y permits Council to acquire r e a l property and rights-of-way for the extension and a l t e r a t i o n of drainage and sewerage systems. Contractual Obligation of the Municipality (b) p a r t l y on public land dedicated as a road; a i i C and To accept the systems of "works" as public systems, Municipal Authority and Comments -S.506 gives the ri g h t of possession of dedicated highways (including roads) to the municipality. -S.461(1) permits Council to impose terms and conditions upon those excavating i n any portion of a highway. -S.247(3) provides,- under the general heading of incurring l i a b i l i t i e s , that "Council may contract for the supply of materials, equipment, and services, professional or otherwise, required for the operation, maintenance and administra-t i o n of the municipality and of municipal property ". -S.513(2) gives Council the following powers: "(a) layout, construct, maintain, and improve highways or any portion thereof;" C o n t r a c t u a l O b l i g a t i o n o f the M u n i c i p a l i t y M u n i c i p a l A u t h o r i t y and Comments "(b) c o n s t r u c t , r e p a i r , maintain, improve, andccare f o r sidewalks and boulevards upon highways. " "(c) provide l i g h t i n g f o r highways, and to do- such t h i n g s as are necessary f o r the safe use and p r e s e r v a t i o n o f highways;" -S.531 permits C o u n c i l to e s t a b l i s h a system of sewerage works ( s a n i t a r y sewers and storm d r a i n s ) and "purchase or c o n s t r u c t the necessary works i n c l u d i n g a c q u i s i t i o n of a l l a p p l i a n c e s , equipment, r e a l property, easements and rights-of-ways r e q u i r e d t h e r e f o r " and "to improve, extend, or a l t e r any e x i s t i n g drainage or sewerage systems " -S.551 g i v e s C o u n c i l a u t h o r i t y to e x e r c i s e t-J CO powers, such as those i n S.506(1) and Contractual Obligation of the Municipality but reserving the right, to the municipality, i n i t s sole and absolute d i s c r e t i o n , to make the f a c i l i t i e s available to the developer's lands or otherwise to dispose of the f a c i l i t i e s . Obligations of the developer To supply a l l material and labour to f u l f i l l , the "works". ("works" were defined as "a complete system of public works, including a system of water services, sidewalks, paved roads, street l i g h t s , storm sewerage, l a t e r a l Municipal Authority and Comments S.56 3, to establish or acquire and to operate a water d i s t r i b u t i o n system and maintain, extend or a l t e r i t s works " - T h i l covenant preserves the municipality's right to exercise proprietary and house-keeping powers with regard to the "works" being constructed by the developer for the municipality. It avoids the p o s s i b i l i t y of the developer being placed i n the position of being able to claim an" interest i n the works. Municipal Authority and Comments (References are to the Municipal Act) SEE:. -S.247 (3) Supra, (authority to contract) -S.551 Supra.(water distribution) -S.513(2)(b) Supra, (sidewalks) -S.513(2) (a) Supra, (paved roads) Obligations of the developer sewers, and certain other services".) To construct the '"works" as f u l l y complete and operational works, at the developer's expense. To complete the "works" within 1 year from the date of the development contract. To assign, transfer and convey to the municipality the developer's i n t e r e s t in the "works" To assign, transfer and. convey to the municipality the developer's i n t e r e s t i n the lands upon or i n which the "works" are situated (other than i n regard those along dedicated roads). Municipal Authority and Comments -S.513(2)(d) Supra, (street l i g h t s ) -S.531 Supra, (sewerage) -The covenant simply forms part of the developer's consideration given i n return for the municipality's under-taking to permit the developer to carry out the "works". n H II -S.247(3) Supra, (acquisition of equipment) -S.17 and Sections 464, 466 and 531 (acquisitionoof r e a l property). o O b l i g a t i o n of the developer . To m a i n t a i n t h e . "works" f o r a p e r i o d o f . 1 year from the date of the C o u n c i l ' s R e s o l u t i o n of Completion. To d e p o s i t w i t h the m u n i c i p a l i t y , s e c u r i t y i n the form of a c e r t i f i e d cheque or l e t t e r o f c r e d i t f o r the performance of the d e v eloper's undertakings. To stake out each s u b d i v i d e d l l o t i n the s u b d i v i s i o n ( i f any) w i t h approved markings — and p r o t e c t and keep the markings i n p l a c e d u r i n g the course of c o n s t r u c t i o n and development. To pay f o r and e r e c t s t r e e t s i g n s . M u n i c i p a l A u t h o r i t y . a n d Comments -T h i s covenant a l s o forms, p a r t of the developer's c o n s i d e r a t i o n g i v e n i n r e t u r n f o r the m u n i c i p a l i t y ' s under-t a k i n g to permit the developer to c a r r y out the "works". II II II and, where a p p l i c a b l e , see -S.461(1) Supra. (i m p o s i t i o n of c o n d i t i o n s upon those excavating i n highways) -S.573(2)(a) Supra, (improve highways) O b l i g a t i o n of the developer To pay f o r , . e r e c t and m a i n t a i n v a r i o u s p r o t e c t i v e d e v i c e s t o i n s u r e the s a f e t y of the p u b l i c d u r i n g the c o n s t r u c t i o n of the works. To save harmless and indemnify the m u n i c i p a l i t y a g a i n s t c l a i m s brought by reason of the e x e c u t i o n of the "works"; and a g a i n s t expenses i n c u r r e d by reason of l i e n s f o r non-payment of labour and m a t e r i a l s e t c . To c a r r y Comprehensive L i a b i l i t y Insurance, naming the m u n i c i p a l i t y as an a d d i t i o n a l i n s u r e d , i n p a r t i a l , d i s c h a r g e of the d eveloper's o b l i g a t i o n t o save the M u n i c i p a l i t y harmless. To save harmless and indemnify the M u n i c i p a l A u t h o r i t y and Comments -S.461(1) Supra. . ( i m p o s i t i o n of c o n d i t i o n s upon those excavating i n highways) -These covenants form p a r t of the developers c o n s i d e r a t i o n g i v e n i n r e t u r n f o r the m u n i c i p a l i t y ' s under-t a k i n g to permit the developer to c a r r y out the "works" Such undertakings are common i n standard m u n i c i p a l c o n s t r u c t i o n c o n t r a c t s . II H II O b l i g a t i o n of the developer m u n i c i p a l i t y a g a i n s t a l l expenses i n c u r r e d as a r e s u l t o f f a u l t y workmanship and d e f e c t i v e m a t e r i a l i n any o f the "works" To agree t h a t no r e p r e s e n t a t i o n s , guarantees, or promises t o the developer, other than those c o n t a i n e d i n t h i s c o n t r a c t were made by the m u n i c i p a l i t y ; and t h a t the developer has ente r e d the c o n t r a c t s o l e l y i n c o n s i d e r a t i o n f o r the m u n i c i p a l i t y p e r m i t t i n g the developer t o perform the "works" — "which covenant i s the f u l l and only c o n s i d e r a t i o n given bytthe m u n i c i p a l i t y " M u n i c i p a l A u t h o r i t y and Comments -T h i s covenant.was necessary t o i n s u r e t h a t the developer understood and acknowledged h i s - u n d e r t a k i n g s were being given, .in r e t u r n f o r the s i n g l e b a s i c undertaking o f ; t h e m u n i c i p a l i t y — v i z . t h a t i t w i l l permit the d e v e l o p e r t o c a r r y out the "works". In t h i s way i t was made c l e a r t h a t the m u n i c i p a l i t y was not b a r g a i n i n g away any of i t s r e g u l a t o r y powers, an impropriety which had c r e p t i n t o development c o n t r a c t s prepared f o r some other communities. The covenant a l s o preserves the m u n i c i p a l i t y ' s r i g h t t o e x e r c i s e i t s . p r o p r i e t a r y and house-keeping powers with regard to the f a c i l i t i e s being c o n s t r u c t e d by the developer f o r the m u n i c i p a l i t y . These can be administered H U) O b l i g a t i o n of the develope r M u n i c i p a l A u t h o r i t y and Comments by the m u n i c i p a l i t y with the-- same independence of a c t i o n i t e x e r c i s e s i n connection with those p a r t s of the p u b l i c works systems b u i l t at d i r e c t m u n i c i p a l expense. T h i s avoids the p o s s i b i l i t y of the developer being placed i n a p o s i t i o n of being able t o c l a i m an i n t e r e s t i n the "works" above and beyond any other p r o p e r t y owner. 145 No one questions the r i g h t of a municipality to enter into an agreement with a contractor to i n s t a l l works and services for a fee agreeable to the contractor. Fraud apart, the courts don "t look into ..whether the "con? sideration" i n a given contract i s insufficient,.adequate or overly generous. I t i s assumed that the pa r t i e s , i n entering into an agreement of; t h e i r own v o l i t i o n , are doing so i n their.own best i n t e r e s t s . Contracts are b i l a t e r a l - with the consent of. two part i e s ; while bylaws are u n i l a t e r a l , i n the sense that council.sets the ground rules and everyone i s bound whether they agree with the law or not. In Richmond the.council was very c a r e f u l not to put i t s e l f i n a position of being accused of impropriety, (viz.; the appearance of s e l l i n g r i g h t s under i t s "police power" bylaws — a practice which is. c l e a r l y wrong. See City of Vancouver vs. Registrar of Vancouver Land Registry D i s t r i c t . 15 WWR 351 § 356 (CABC).) F i r s t , i t had i n place the customary zoning and subdivision control bylaws (via i t s . " p o l i c e powers"). Subdivision bylaws at that time could require only a limited provision of services (not including the water and sewer) as a condition precedent ' :to approval.of subdivisions. However, council by resolution had on f i l e a p o l i c y state-ment directed to i t s engineering department.making i t clear that the public water and street l i g h t i n g u t i l i t i e s were to be connected to f u l l y serviced subdivisions only. In other words, a developer could not c a l l for connection to 146 the public water u t i l i t y system i f his subdivision was not " f u l l y serviced". In a housekeeping bylaw, council had established, for the guidance of the municipal engineer and for the information of private developers, the s p e c i f i c types and standards of services required i n a " f u l l y serviced" subdivision. In the un l i k e l y event someone wished to subdivide land f o r , say, estate purposes they could exercise t h e i r prerogative under the .subdivision control bylaw- (a regulatory bylaw). But unless, they provided f u l l subdivision services, the municipality would not extend services to the new subdivision. If the developers wished to wait u n t i l the municipality had the resources to service the area out of general revenue funds.that, option was open. If however, they chose to enter a development contract to put i n a l l subdivision services, at t h e i r private expense (both on-site and o f f - s i t e ) , that was a p o s s i b i l i t y the benefits of which each developer could weigh for himself. Council, i n entertaining such development contracts was exercising purely housekeeping or. administrative powers (unlike the "police powers" under which the subdivision control bylaw had been passed). In summary, Richmond separated i t s l e g i s l a t i v e actions from those authorized under i t s housekeeping powers. 147 I t was s c r u p u l o u s l y c a r e f u l i n adopting i t s zoning and s u b d i v i s i o n c o n t r o l bylaws. The approving o f f i c e r would not r e f u s e any a p p l i c a t i o n , t o s u b d i v i d e under those bylaws, d e s p i t e the f a c t o n l y p a r t i a l s e r v i c i n g ( l a r g e l y roads and storm d r a i n s ) were a l l t h a t i t was p o s s i b l e to'demand under the law a t t h a t time. However, a t the same time, the m u n i c i p a l i t y under i t s housekeeping powers d i d not permit such s u b d i v i s i o n to- be connected up to the. water s e r v i c e ( i n the event the developer chose to avaiL-himself. of.-the s u b d i v i s i o n c o n t r o l bylaw) u n l e s s he entered a c o n t r a c t to i n s t a l l a l l of the  s e r v i c e s e s t a b l i s h e d under.the p o l i c y bylaw g i v i n g  i n s t r u c t i o n s t o the m u n i c i p a l engineer. As.you.can see, the procedures which were e s t a b l i s h e d i n Richmond n e c e s s i t a t e a c l e a r understanding of what a m u n i c i p a l i t y can and cannot do under i t s " r e g u l a t o r y " and "housekeeping"^powers r e s p e c t i v e l y . I f a m u n i c i p a l i t y chose t o use t h i s approach, I suggest t h a t t h e i r s o l i c i t o r , be asked to prepare the necessary.bylaws and s t a f f i n s t r u c t i o n s r e q u i r e d to b r i n g i t about. There are a number of s p e c i f i c l e g a l q u e s t i o n s which must be c o n s i d e r e d . For i n s t a n c e , one of the Cam-Ker c o u r t d e c i s i o n s (Abbotsford) i n d i c a t e d t h a t i f the water s e r v i c e is..being s u p p l i e d t o a g i v e n neighbourhood .by v i r t u e of a bylaw passed" under S e c t i o n 616 ( s p e c i f i e d areas) of the M u n i c i p a l Act, t h e r e may be an o b l i g a t i o n on the 148 p a r t of the m u n i c i p a l i t y t o supply water s e r v i c e s . I assume t h a t i f a m u n i c i p a l i t y was o p e r a t i n g under S e c t i o n 560 (2) of the M u n i c i p a l A c t and had s e t up a water d i s t r i b u t i o n system under.the. g e n e r a l - terms of t h a t s e c t i o n , the reas o n i n g i n the Cam-Ker d e c i s i o n would not apply. Yours t r u l y , W.T. Lane Commissioner Regional Development 149 APPENDIX 4 EXTRACTS FROM A SEMINAR ON THE LAND USE CONTRACT (1976) BY W.T. LANE, B. PORTER AND G. WILSON, APPLICABLE TO DEVELOPMENT CONTRACTS AND IMPOST FEES Mr. B« P o r t e r : Surrey u t i l i z e s imposts i n two other i n s t a n c e s (beside the land use c o n t r a c t method). The f i r s t one i s i n the form of development or s e r v i c i n g agreement. We have based our development or s e r v i c i n g agreements form of imposts on S e c t i o n 711(4) of the M u n i c i p a l Act. T h i s i s where the Approving O f f i c e r can r e j e c t a s u b d i v i s i o n i f he c o n s i d e r s the c o s t e x c e s s i v e to the m u n i c i p a l i t y . We have a l s o based them, to a l e s s e r e x t e n t , on S e c t i o n 96 of the Land R e g i s t r y Act. What we do i n a p r e l i m i n a r y s u b d i v i s i o n l a y o u t l e t t e r , given to an a p p l i c a n t f o r s u b d i v i s i o n , i s to i n d i c a t e t h a t the Approving O f f i c e r has c o n s i d e r e d a s u b d i v i s i o n and i s l i k e l y to r e j e c t the s u b d i v i s i o n unless the a p p l i c a n t i s prepared to pay the imposts as i n d i c a t e d . We then l i s t the imposts and ensure to use the words " i s l i k e l y " or the word "may" because i n no way can the abs o l u t e d i s c r e t i o n of the Approving O f f i c e r be f e t t e r e d . He must s t i l l have the o p t i o n o f approving, i f necessary; but the Approving O f f i c e r may not approve a s u b d i v i s i o n because he c o n s i d e r s the c o s t exces-s i v e to the m u n i c i p a l i t y . You have got to be able to prove t h a t those c o s t s are e x c e s s i v e . The Approving O f f i c e r i s going to have to s u s t a i n h i s d e c i s i o n . He i s going to have ,150 to say t h a t he has spoken to the Engineer, and the Engineer has s a i d t h a t without the payment of imposts, the c o s t s o f the development to the m u n i c i p a l i t y w i l l be e x c e s s i v e . We cannot p r o v i d e parklands, and we cannot improve our a r t e r i a l roads and upgrade our water f a c i l i t i e s . The a c t u a l development agreement t h a t the developer s i g n s roughly says: "I acknowledge t h a t the Approving O f f i c e r has i n d i c a t e d t h a t he may have to r e j e c t my s u b d i v i s i o n and a c c o r d i n g l y I tender these f o l l o w i n g imposts to o f f -s e t those c o s t s o c c a s i o n e d by my development." The development agreement, of course, i s u t i l i z e d where there are o f f - s i t e s e r v i c e s which r e q u i r e c o n s t r u c t i o n i n m u n i c i p a l r i g h t s - o f - w a y . There are a l s o i n s t a n c e s where a s u b d i v i s i o n i s n o t h i n g but a simple l o t s p l i t on a road t h a t i s a l r e a d y c o n s t r u c t e d , where the water mains and s a n i t a r y sewer mains a l r e a d y run i n f r o n t and there are no o f f - s i t e requirements whatsoever. I t i s a simple s p l i t , a simple s u b d i v i s i o n . There we have a l i t t l e t h i n g c a l l e d a "mini-agreement", which i n essence r e c i t e s the same t h i n g as the development agreement s a y i n g t h a t "I acknowledge th a t the Approving O f f i c e r has s a i d t h a t he i s not prepared to approve the s u b d i v i s i o n u n l e s s the imposts to cover e x c e s s i v e c o s t s are tendered." Once t h a t agreement has been re t u r n e d , the imposts are tendered, and i t i s signed by the developer, we s i g n the f i n a l s u b d i v i s i o n p l a n s . 151 APPENDIX 5 SAMPLE COMMUNITIES: CITIES AND MUNICIPALITIES WITH A POPULATION OVER 10,000 PERSONS (1971 CENSUS) Date of M u n i c i p a l Date of C i t i e s Response D i s t r i c t Response Cranbrook February 14 Burnaby February 14 Kamloops February 4 Campbell R i v e r February 7 Kelowna March 3* C h i l l i w h a c k February 17 Kimberley February 16 Coquitlam March 3* Langley March 2* D e l t a February 7 Nanaimo March 2* Esquimalt February 7 New Westminster February 10 K i t i m a t February 14 North Vancouver February 14 Langley March 2* P e n t i c t o n February 7 Maple Ridge February 10 P o r t Coquitlam February 4 Matsqui March 2* P o r t Moody March 2* M i s s i o n March 2* P r i n c e George March 2* Oak Bay February 7 P r i n c e Rupert February 9 Powell R i v e r February 21 T r a i l February 15 Richmond February 18 Vancouver February 4 Saanich February 10 Vernon March 3* Surrey March 2* V i c t o r i a February 7 Terra c e February 10 White Rock February 4 West Vancouver February 18 * Response by telephone. 152 APPENDIX 6 SYNOPSIS OF RESPONSES SUBMITTED TO THE IMPOST FEE QUESTIONNAIRE (1977) The f o l l o w i n g i s a synopsis o f the responses submitted by those l o c a l i t i e s i n B r i t i s h Columbia which had adopted the impost fee concept by March 3, 1977. The synopsis i s disaggregated a c c o r d i n g to l o c a l i t y , and f o r each l o c a l i t y i n f o r m a t i o n d e a l i n g w i t h fee apportionment and means of implementation i s i n c l u d e d . The i n f o r m a t i o n presented h e r e i n i s o n l y a p p l i c a b l e to those dates, which are l i s t e d i n Appendix 5 and which correspond to the date of each submission. Minor d i s c r e p a n c i e s may occur because there may have been some s l i g h t , u n i n t e n t i o n a l m i s i n t e r -p r e t a t i o n s o f the responses. Furthermore, the ensuing d e s c r i p t i o n s o f cash impost s t r u c t u r e s are presented i n v a r y i n g degrees of completeness, the reason being t h a t the i n f o r m a t i o n p r o v i d e d i n the q u e s t i o n n a i r e s and telephone c o n v e r s a t i o n s v a r i e d i n terms of content. 6.1 THE CITY OF CRANBROOK U n l i k e many other communities which were a s s e s s i n g a "per u n i t " impost fee, the C i t y o f Cranbrook imposed a "per a c r e " impost o f $1,300 f o r a l l types o f r e s i d e n t i a l development. T h i s assessment was r e q u i r e d by the C i t y as a p r e r e q u i s i t e f o r f i n a l a pproval o f a development and was co n s i d e r e d to be a "storm sewer f e e " . Thus, i f storm sewers 153 ; were r e q u i r e d i n a development, the C i t y was r e s p o n s i b l e f o r a l l c o s t s . In s h o r t , the developer p a i d the storm sewer fee, c o n s t r u c t e d and s u p p l i e d the storm sewer, and was reimbursed by the C i t y f o r the t o t a l c o s t s i n c u r r e d . The reimbursements were e x t r a c t e d from the "Storm Sewer Fund", which was a c o l l e c t i o n o f a l l revenue a c q u i r e d i n t h i s manner. 6.2 THE CITY OF KAMLOOPS The C i t y o f Kamloops was implementing a system i n which a l l s i n g l e f a m i l y d w e l l i n g s and duplexes, which were c o n s t r u c t e d under a land use c o n t r a c t , were charged $2,130 per u n i t ( i . e . , duplexes were assessed a t o t a l of $4,260). M u l t i p l e d e n s i t y r e s i d e n t i a l u n i t s , which were s i m i l a r i l y under a l a n d use c o n t r a c t , were assessed $1,850 per u n i t . In the C i t y o f Kamloops, impost fees were not charged a g a i n s t those developments which d i d not r e q u i r e l a n d use c o n t r a c t s . The r a t i o n a l e f o r the $2,130 l e v y was as f o l l o w s : $ 350 Water Levy 350 S a n i t a r y Sewer Levy 4 30 Storm Sewer Levy 700 Road Levy 300 School and- Parkland Levy $2,130 T o t a l Impost Fee (per uni t ) T h i s d i s a g g r e g a t i o n of the impost fee was a d i r e c t r e s u l t qf a comprehensive study c a l l e d the " C i t y of Kamloops Rate Study" (1975), which was conducted by .154 S t a n l e y A s s o c i a t e s Engineers L i m i t e d , f o r the C i t y o f Kamloops. In the study, a l l sources o f revenues and a l l types of c o s t s were taken i n t o c o n s i d e r a t i o n f o r the d e t e r m i n a t i o n of an e q u i t a b l e and adequate impost fee r a t e s t r u c t u r e . The above noted enumeration o f l e v i e s was the d i r e c t r e s u l t of t h i s study and r e p r e s e n t s the average minimum c o s t s of p r o v i d i n g m u n i c i p a l s e r v i c e s . The m u l t i p l e d e n s i t y impost was computed i n a s i m i l a r manner, r e s u l t i n g i n a fee o f $1,850 per u n i t . 6.3 THE CITY OF KELOWNA The C i t y o f Kelowna d i d not have a separate r a t e s t r u c t u r e which was a p p l i e d to s i n g l e f a m i l y d w e l l i n g s , duplexes, or m u l t i p l e d e n s i t y u n i t s . Rather, i t u t i l i z e d a v a r i a b l e r a t e s t r u c t u r e which was a p p l i c a b l e to a l l types of r e s i d e n t i a l u n i t s . The d i s a g g r e g a t i o n of the fee s t r u c t u r e was as f o l l o w s : $ 5 per f o o t of t a x a b l e frontage f o r a Storm Sewer Levy $300 per u n i t f o r a S a n i t a r y Sewer Levy $150 per u n i t f o r a Waterworks Levy The Storm Sewer Levy was o n l y assessed a g a i n s t those developments which were proposed to be l o c a t e d w i t h i n the " o l d c i t y " ( i . e . , the area which c o n s t i t u t e d the C i t y of Kelowna p r i o r to the 19 7 3 amalgamation), or where the " o l d c i t y " storm sewer system r e c e i v e d r u n - o f f from the proposed development. In t h i s case, the impost fee was implemented through a l a n d use c o n t r a c t , or i f one was not 155 a p p l i c a b l e , the fee was a c q u i r e d a t the time of s u b d i v i s i o n . On the other hand, the S a n i t a r y Sewer Levy and the Waterworks Levy was assessed a g a i n s t a l l new developments on a per u n i t b a s i s . The charges were a c q u i r e d i n one of three ways: 1, through a land use c o n t r a c t ; 2, when a b u i l d i n g permit was i s s u e d ; o r , 3, when the systems were connected to the m u n i c i p a l s e r v i c e s . •6.4(a), THE CITY OF LANGLEY The C i t y of Langley had adopted an impost fee r a t e s t r u c t u r e which was very s i m i l a r to the system which was u t i l i z e d by the M u n i c i p a l i t y of Surrey. The d i s a g g r e -g a t i o n of i t s r a t e s i s enumerated i n the f o l l o w i n g t a b l e : A DISAGGREGATION OF THE IMPOST FEE IN THE CITY OF LANGLEY Type of impost Fee Types of R e s i d e n t i a l Development (per l i v i n g u n i t or a d d i t i o n a l l o t created) S i n g l e Family Duplex Mult. Density M u n i c i p a l Non-A r t e r i a l Roadway Impost M u n i c i p a l A r t e r i a l Roadway Impost V Downstream Drainage F a c i l i t i e s Impost Waterworks Impost A c q u i s i t i o n or Development of P u b l i c Lands Impost n i l or $ 650/unit $ 200/unit $ 300/unit $ 150/unit $ 905/unit n i l or $ 650/unit $ 200/uhit $ 300/unit $ 150/unit $ 905/unit n i l or $ 650/unit $ 200/unit $ 300/unit $ 150/unit $500/bedroom, den, study or studio(max. $l,500/unit) T o t a l Amount of Impost Fees $ l , 5 5 5 / u n i t or $2,205/unit $ l , 5 5 5 / u n i t or $2,205/unit $1,150/unit -or $2,800/unit 156 In Langley, the above noted imposts were assessed as a requirement to d e f r a y e x c e s s i v e c o s t s to the C i t y and was s t i p u l a t e d i n i t s . "Development P o l i c y " . E x t r a c t s from the "Development P o l i c y " , which pr o v i d e f u r t h e r d e t a i l s to the impost fee r a t e s t r u c t u r e , f o l l o w s : 6.4(b) EXTRACTS FROM THE CORPORATION OF THE CITY OF LANGLEY DEVELOPMENT POLICY APPLICABLE TO THE IMPOST FEE  THIS POLICY SHALL BE EFFECTIVE ON AND FROM THE FIRST DAY OF JANUARY 19 77. WHEREAS as a r e s u l t of s u b d i v i s i o n s and develop-ments w i t h i n the C i t y , e x c e s s i v e funds to meet the demand f o r s e r v i c e s c r e a t e d by such s u b d i v i s i o n s . a n d developments i s r e q u i r e d ; AND WHEREAS the demand f o r s e r v i c e s imposed upon the C i t y by the s u b d i v i s i o n s and developments should be p a i d f o r by the lands c r e a t i n g the demand; NOW THEREFORE the h e r e i n a f t e r s t a t e d p o l i c y s h a l l be the e s t a b l i s h e d p o l i c y of the C o r p o r a t i o n of the C i t y of Langley to meet the demand f o r such s e r v i c e s so t h a t the C i t y s h a l l not be c a l l e d upon to expend e x c e s s i v e funds to meet the s a i d demands. B. HIGHWAYS (7) M u n i c i p a l N o n - A r t e r i a l Roadway Impost Where a proposed s u b d i v i s i o n or development f r o n t s 157 on an e x i s t i n g n o n - a r t e r i a l roadway, as d e f i n e d i n the S u b d i v i s i o n C o n t r o l By-Law which i s not c o n s t r u c t e d to p r e s e n t s u b d i v i s i o n standards, and which i s not upgraded by the developer as p a r t of the s u b d i v i s i o n or development works (at the o p t i o n of the C i t y ) , the developer s h a l l pay an impost of $650 f o r each a d d i t i o n a l l o t c r e a t e d or u n i t i n c l u d e d i n the development a b u t t i n g the s a i d roadway, to d e f r a y the C i t y ' s share of upgrading n o n - a r t e r i a l roads to e x i s t i n g s u b d i v i s i o n standards or a t the o p t i o n o f the C i t y , the C i t y s h a l l accept funds equal to the a c t u a l c o n s t r u c t i o n c o s t s o f the s a i d roadway ... (8) M u n i c i p a l A r t e r i a l Roadway Impost For the purpose of d e f r a y i n g the e x c e s s i v e c o s t s to the C i t y r e q u i r e d f o r the upgrading and improve-ment o f highways i n the C i t y made necessary by the i n c r e a s e d p o p u l a t i o n and t r a f f i c d e n s i t y c r e a t e d by s u b d i v i s i o n s and developments, the developer of each s u b d i v i s i o n and development s h a l l pay an impost of $200 f o r each a d d i t i o n a l l o t c r e a t e d by the s u b d i v i s i o n or each u n i t i n c l u d e d i n the development ... A l l funds r e c e i v e d by the C i t y from each such impost s h a l l be h e l d and used by the C i t y f o r the purpose of upgrading and improving a r t e r i a l roadways. C. DOWNSTREAM DRAINAGE 158 (1) For the purpose of d e f r a y i n g the e x c e s s i v e c o s t to the C i t y o f p r o v i d i n g funds r e q u i r e d f o r the upgrading and improvement o f drainage f a c i l i t i e s made necessary by the i n c r e a s e d flow c r e a t e d by s u b d i v i s i o n s and developments, the developer of each s u b d i v i s i o n and development s h a l l pay an impost o f $300 f o r each a d d i t i o n a l l o t c r e a t e d by s u b d i v i s i o n o r each u n i t i n c l u d e d i n the development ... A l l funds r e c e i v e d by the C i t y from such impost s h a l l be h e l d and used by the C i t y f o r the pur-pose o f upgrading and i n c r e a s i n g the flow c a p a c i t y of drainage f a c i l i t i e s . E. WATERWORKS (1) For the purpose o f d e f r a y i n g the e x c e s s i v e c o s t s to the C i t y of p r o v i d i n g funds r e q u i r e d f o r the upgrading and improvement o f main trunks and supply f a c i l i t i e s o f the waterworks system made necessary by the i n c r e a s e d s e r v i c e requirements c r e a t e d by o s u b d i v i s i o n and development, the developer o f each s u b d i v i s i o n and development s h a l l pay an impost of $150 f o r each a d d i t i o n a l l o t c r e a t e d by the s u b d i v i s i o n o r each u n i t i n c l u d e d i n the develop-ment ... A l l funds r e c e i v e d by the C i t y f o r up-grading and improving of the main supply f a c i l i -t i e s of the waterworks system. (2) Where an e x t e n s i o n of a water main passes e x i s t i n g r e g i s t e r e d l o t s which cannot be s u b d i v i d e d f u r t h e r and/or do not r e q u i r e r e z o n i n g to develop, the developer s h a l l p r o v i d e a water s e r v i c e c o n n e c t i o n where p r a c t i c a b l e to each such l o t . The C i t y w i l l reimburse the developer $300 f o r each water connec t i o n r e q u i r e d under t h i s s e c t i o n . K. ACQUISITION OF PUBLIC LANDS For the purpose of d e f r a y i n g e x c e s s i v e c o s t s to the C i t y of p r o v i d i n g funds r e q u i r e d f o r the a c q u i s i t i o n and develop-ment of parks and r e c r e a t i o n f a c i l i t i e s r e q u i r e d f o r parks, playgrounds, r e c r e a t i o n a l and p u b l i c use purposes, i n c l u d i n g commercial p a r k i n g l o t s which are needed to serve the i n c r e a s e d p o p u l a t i o n c r e a t e d by s u b d i v i s i o n s and developments the f o l l o w i n g charges are imposed f o r the uses s e t out i n the f o l l o w i n g t a b l e : A u t h o r i z e d Development Impost Charge R e s i d e n t i a l $905 per u n i t M u l t i - F a m i l y R e s i d e n t i a l $500 per bedroom den, study or s t u d i o (max. of $1,500 per u n i t ) A l l funds r e c e i v e d by the C i t y from such impost s h a l l be h e l d and used by the C i t y f o r the a c q u i s i t i o n and develop-ment o f lands r e q u i r e d f o r parks, playgrounds, r e c r e a t i o n 1 6 0 f a c i l i t i e s and other p u b l i c use purposes, i n c l u d i n g com-m e r c i a l p a r k i n g l o t s . Provided t h a t the C i t y may accept lan d i n l i e u of cash, or p a r t l y l a n d and p a r t l y cash, to s a t i s f y t h i s requirement; p r o v i d e d f u r t h e r t h a t the value to be imputed to the l a n d o f f e r e d by the developer f o r t h i s purpose s h a l l be a r r i v e d a t by mutual agreement. (The c u r r e n t general l a n d assessment s h a l l be used to determine the land value.) SOURCE: The C o r p o r a t i o n o f the C i t y o f Langley Development P o l i c y . 6 . 5 THE CITY OF NANAIMO The C i t y o f Nanaimo d i d not assess impost fees on s i n g l e f a m i l y d w e l l i n g nor duplexes, per se. However, the C i t y d i d charge $ 1 , 3 0 0 per l o t i n a l l new s u b d i v i s i o n s . T h i s money was a c q u i r e d as a c o n d i t i o n f o r s u b d i v i s i o n a p p r o v a l . In the case o f m u l t i p l e d e n s i t y u n i t s , the C i t y of Nanaimo assessed $ 1 , 3 0 0 per u n i t , and t h i s was c o l l e c t e d a t the time the b u i l d i n g permit was i s s u e d . T h e i r d i s a g g r e -g a t i o n o f the fee was as f o l l o w s : $ 2 5 0 Highways Levy 1 5 0 Storm Drainage Levy 2 5 0 S a n i t a r y Sewer Levy 2 5 0 Water Levy 4 0 0 P u b l i c Lands Levy $ 1 , 3 0 0 T o t a l Impost Fee 161 6.6 THE CITY OF NORTH VANCOUVER The C i t y of North Vancouver assessed a minimal impost of $50 per u n i t f o r a l l types of r e s i d e n t i a l d w e l l i n g s . T h i s fee was c o l l e c t e d f o r the a c q u i s i t i o n and/or the development of p u b l i c lands and was l e v i e d a t the time of b u i l d i n g permit 'issuance. 6.7 THE CITY OF PENTICTON The C i t y of P e n t i c t o n had one r a t e s t r u c t u r e which was a p p l i c a b l e to a l l types of r e s i d e n t i a l develop-ments. I t s impost f e e , which was a c q u i r e d through lan d use c o n t r a c t s , amounted to $1,700 per u n i t or $1,9 30 per u n i t , depending upon the l o c a t i o n of the proposed develop-ment. The impost fee i n c l u d e d : $ 4 00 M u n i c i p a l A r t e r i a l Roadway Levy 34 5 Storm Sewer System Levy 460 or $ 690 Waterworks Levy (depends upon the l o c a t i o n of the development) 495 General or U n s p e c i f i e d Levy $1,700 $1,930 T o t a l Impost Fee (per u n i t ) 6.8 THE CITY OF PORT COQUITLAM In the C i t y of P o r t Coquitlam, there was one standard per u n i t fee ($1,100) imposed upon a l l types o f r e s i d e n t i a l development. T h i s fee was comprised of two l e v i e s - $300 f o r the Waterworks Levy and $800 f o r the P u b l i c Lands Levy. The C i t y a c q u i r e d t h i s fee i n one of three ways: 162 1. i n the case of r e z o n i n g s , these fees were c o l l e c t e d p r i o r to the approval of the rezoning; 2. i n the case of s u b d i v i s o n , these fees were c o l l e c t e d p r i o r to s u b d i v i s i o n a p p r o v a l ; o r , 3. i f n e i t h e r of the above was a p p l i c a b l e , these fees were then c o l l e c t e d a t the time of issuance of the b u i l d i n g permit. 6.9 THE CITY OF VERNON In the C i t y of Vernon, the impost fee was com-puted to be $800 per u n i t f o r s i n g l e f a m i l y d w e l l i n g s and duplexes, and $600 per u n i t f o r m u l t i p l e d e n s i t y d w e l l i n g s . In the former case, the impost was c o l l e c t e d as a sub-d i v i s i o n fee and was a p r e r e q u i s i t e f o r s u b d i v i s i o n a p p r o v a l . In the l a t t e r case, the impost was c o l l e c t e d i n c o n j u n c t i o n with a la n d use c o n t r a c t . The impost apportionment i s enumerated i n the f o l l o w i n g t a b l e : A DISAGGREGATION OF THE IMPOST FEE IN THE CITY OF VERNON Type of Impost Fee Types of R e s i d e n t i a l Development (per l i v i n g u n i t or a d d i t i o n a l l o t created) S i n g l e Family Dwelling/Duplex M u l t i p l e Density Water Levy Sewer Levy Parks Levy $300/unit $300/unit $200/unit $200/unit $200/unit $200/unit T o t a l Amount of Impost Fees $800/unit $600/unit 6 . 1 0 THE CITY OF WHITE ROCK 1.63 In the C i t y of White Rock, there was no impost fee assessed on the c o n s t r u c t i o n of a s i n g l e f a m i l y d w e l l i n g or duplex. However, there was a $ 1 , 5 0 0 per u n i t l e v y imposed upon the c o n s t r u c t i o n o f m u l t i p l e d e n s i t y r e s i d e n c e s , which was c o l l e c t e d through the use of land use c o n t r a c t s . The r a t i o n a l e f o r the amount of fee i s as f o l l o w s : $ 1 , 0 0 0 f o r the a c q u i s i t i o n and/or development of p u b l i c lands 5 0 0 f o r ge n e r a l improvements to p u b l i c u t i l i t i e s $ 1 , 5 0 0 T o t a l Impost Fee (per u n i t ) 6 . 1 1 ( a ) THE MUNICIPAL DISTRICT OF BURNABY The M u n i c i p a l i t y o f Burnaby l e v i e d an impost fee used e x c l u s i v e l y to ac q u i r e p r o p e r t y s u i t a b l e f o r neighbour-hood park purposes. ' T t S j impost, c a l l e d the Parkland A c q u i s i t i o n Levy, was a p p l i e d to those areas o f the munici-p a l i t y which were e x p e r i e n c i n g a r a p i d r a t e o f development o r redevelopment to hi g h e r d e n s i t y r e s i d e n t i a l uses. The le v y was equal to 5 0 percent o f the estimated a c q u i s i t i o n c o s t of neighbourhood p a r k l a n d . The amount o f fee, a c c o r d i n g to the housing type i s l i s t e d below. 164 THE AMOUNT OF IMPOST FEE BY HOUSING TYPE IN THE MUNICIPALITY OF BURNABY Housing Type Standard Levy/Unit Senior C i t i z e n s Levy/Unit* S i n g l e Family D w e l l i n g $ 521/unit a p p l i c a b l e to s u b d i v i s i o n Townhouse (12 u.p.a.i) $ 528/unit $ 264/unit Garden Apartment (20 u.p.a.t) $ 630/unit $ 315/unit 3-Storey Apartment (50 u.p.a.t) $ l , 1 2 5 / u n i t $ 562/unit RM4 High Rise (80 u.p.a.i) $ 950/unit $ 475/unit RM5 High Rise (100 u.p.a.i) $ l , 0 8 0 / u n i t $ 540/unit *On September 27, 1976, C o u n c i l adopted the recommendation t h a t the Parkland A c q u i s i t i o n Levy f o r s e n i o r c i t i z e n s ' r e s i d e n t i a l developments be reduced to 5 0 per cent of the per u n i t l e v y e s t a b l i s h e d f o r standard r e s i d e n t i a l u n i t s . In the M u n i c i p a l i t y o f Burnaby, the Parkland A c q u i s i t i o n Levy was assessed i n three ways. F i r s t l y , i n the case o f s u b d i v i s i o n s , i t was a c q u i r e d as a c o n d i t i o n of s u b d i v i s i o n a p p r o v a l . Secondly, i f a re z o n i n g was r e q u i r e d , the impost was assessed as a c o n d i t i o n o f rez o n i n g a p p r o v a l . F i n a l l y , i f n e i t h e r o f the former a l t e r n a t i v e s were a p p l i c a b l e , the fee was a p p l i e d a t the p r e l i m i n a r y p l a n approval stage. F u r t h e r i n f o r m a t i o n r e l a t i n g to the Parkland A c q u i s i t i o n Levy i n Burnaby, f o l l o w s . 165 6.11(b) THE PARKLAND ACQUISITION LEVY ' A p p l i e d to R e s i d e n t i a l Development i n Burnaby (Updated September 28, 1976) . There has been a concern on the p a r t of C o u n c i l as to the adequacy of parks and open green space i n s p e c i f i c areas o f Burnaby which are now e x p e r i e n c i n g a r a p i d r a t e of development or redevelopment to h i g h e r d e n s i t y r e s i d e n t i a l uses. A second major concern i s whether the c o s t o f pro-v i d i n g a d d i t i o n a l park space n e c e s s i t a t e d by i n c r e a s i n g r e s i d e n t i a l p o p u l a t i o n should be borne by the developers o f r e s i d e n t i a l p r o j e c t s or by the community at l a r g e . Through the Parks A c q u i s i t i o n Programme which has been developed j o i n t l y by the Parks and R e c r e a t i o n Commission and Department and the Planning Department, the m u n i c i p a l i t y has a method to a c q u i r e p r o p e r t y s u i t a b l e f o r park purposes as i t becomes f r e e l y a v a i l a b l e or as f i n a n c e s permit. However, the expenditure of funds f o r p a r k l a n d a c q u i s i t i o n emphasizes the major c o n s o l i d a t i o n of community park areas and systems. The i n c r e a s e i n d e n s i t i e s i n a number o f d e s i g n a t e d d e v e l o p i n g r e s i d e n t i a l areas has r e s u l t e d i n a concomitant need f o r a d d i t i o n a l neighbourhood parks. Due i n p a r t to the f i n a n c i a l p r i o r i t i e s and c o n s t r a i n t s o f the m u n i c i p a l i t y i n budgeting f o r p a r k l a n d a c q u i s i t i o n s , i t has been deemed a p p r o p r i a t e t h a t the developers of new r e s i d e n t i a l developments should bear some r e s p o n s i b i l i t y f o r the p r o v i s i o n of necessary neighbourhood parks. 166 On December 29, 1975, C o u n c i l adopted the f o l l o w i n g recommendations e s t a b l i s h i n g a Parkland A c q u i s i t i o n Levy-on new r e s i d e n t i a l development i n Burnaby. The adopted Recommendations are: 1. The Parkland A c q u i s i t i o n Levy a p p l i e s to s p e c i f i c p l a n areas where the p l a n i s expressed i n maps, pl a n s , and r e p o r t s or any combination t h e r e o f , and i s to be d e p o s i t e d i n i n t e r e s t - b e a r i n g r e s e r v e accounts w i t h r e c o r d accounts e s t a b l i s h e d c o r r e s p o n d i n g the Neighbourhood Pl a n n i n g Areas. Note: (a) a developer may d e d i c a t e a p p r o p r i a t e designated parkland i n l i e u o f l e v y d e p o s i t s ; (b) the l e v i e s which are c o l l e c t e d are to be u t i l i z e d to a c q u i r e neighbourhood p a r k l a n d w i t h i n the p r e c i n c t of the Neighbourhood Pla n n i n g Area or i n any d i r e c t l y a b u t t i n g area; (c) the determined l e v i e s f o r a given r e s i d e n t i a l p r o p o s a l are to be submitted by the developer i n the form of a c e r t i f i e d cheque i n favour of the C o r p o r a t i o n of Burnaby. 2. The Parkland A c q u i s i t i o n Levy a p p l i e s i n the f o l l o w i n g i n s t a n c e s : (a) S u b d i v i s i o n Approval -A per u n i t l e v y f o r each a d d i t i o n a l s u b d i v i d e d 167 s i n g l e f a m i l y d w e l l i n g l o t c r e a t e d from the o r i g i n a l l o t ( s ) . (b) P r e l i m i n a r y Plan Approval -A per u n i t l e v y f o r any r e s i d e n t i a l p r o p o s a l which corresponds to the zoning r e g u l a t i o n of a pre-zoned s i t e zoned p r i o r to 1970 a c c o r d i n g to the RM1, RM2, RM3 or RM5 zoning r e g u l a t i o n s but which has not been developed to i t s designated zoning category. (c) Rezoning Approval -A per u n i t l e v y f o r any r e s i d e n t i a l r e z o n i n g p r o p o s a l . 3. C o u n c i l approved a l e v y equal to 5 0 per cent of the estimated a c q u i s i t i o n c o s t of neighbourhood pa r k l a n d r e s u l t i n g i n the f o l l o w i n g l e v i e s . On September 27, 1976, C o u n c i l adopted the recommendation t h a t the Park-land A c q u i s i t i o n Levy f o r s e n i o r c i t i z e n s ' r e s i d e n t i a l developments be reduced to 5 0 per cent of the per u n i t l e v y e s t a b l i s h e d f o r standard r e s i d e n t i a l u n i t s . Standard Levy Senior C i t i z e n s Housing Type Per U n i t Levy Per U n i t S i n g l e Family D w e l l i n g $ 521/unit ( a p p l i c a b l e to s u b d i v i s i o n ) Townhouse (12 u.p.a.±) $ 528/unit $ 264/unit Garden Apartment (20 u.p.a.±) $ 630/unit $ 315/unit 3-Storey Apartment (50 u.p.a.i) $ l , 1 2 5 / u n i t $ 562/unit RM4 High Rise (80 u.p.a.l) $ 950/unit $ 475/unit RM5 High Rise (100 u.p.a.l) $ l , 0 8 0 / u n i t $ 540/unit 168 .169 Note: (a) The Burnaby r e c r e a t i o n a l space standard employed f o r the p r o v i s i o n of neighbourhood parks i s 2.0 acres per 1,000 persons. SOURCE: The C o r p o r a t i o n of the D i s t r i c t of Burnaby, Pla n n i n g Department. 6.12 THE MUNICIPAL DISTRICT OF CHILLIWHACK The D i s t r i c t o f C h i l l i w h a c k had two types of impost fees - a park d e d i c a t i o n l e v y and a road frontage improvement charge. The former type o f l e v y was a c q u i r e d i n e i t h e r one o f two ways: 1. a developer c o u l d e i t h e r d e d i c a t e seven percent of the s u b d i v i d e d lands ( i n a l o c a t i o n a c c e p t a b l e to the 1 Township) to the Township; o r , 2. he c o u l d pay a sum which was equal to seven percent of 80 percent of the value of the l o t s based on the a p p r a i s a l of " s u b d i v i d e d worth". The l a t t e r type of l e v y , the road f r o n t a g e improvement charge, was based on the d i s t a n c e of develop-ment along an e x i s t i n g road. T h i s impost was assessed on the b a s i s of $25 per f r o n t f o o t of development a b u t t i n g an e x i s t i n g road, p l u s $12.50 per f r o n t f o o t of development a b u t t i n g on a s i d e s t r e e t ( i . e . , i f a corner l o t ) . A l l impost fees i n the D i s t r i c t of C h i l l i w h a c k were imposed as a c o n d i t i o n of development a p p r o v a l . 6.13 THE MUNICIPAL DISTRICT OF COQUITLAM ,170 The D i s t r i c t of Coquitlam l e v i e d one per u n i t fee ($600) f o r a l l types o f r e s i d e n t i a l developments. T h i s impost, l i k e Burnaby 1s, was used f o r the expressed purpose of parkland a c q u i s i t i o n s . I t was a c q u i r e d i n the f o l l o w i n g manner: 1. Through r e z o n i n g s : The p a r k l a n d a c q u i s i t i o n fee was r e q u i r e d as p a r t of a development agreement, between the developer and the M u n i c i p a l i t y . Unless a develop-ment agreement was signed, C o u n c i l d i d not g i v e f o u r t h r e a d i n g to the r e z o n i n g . 2. Through land use c o n t r a c t s : The p a r k l a n d a c q u i s i t i o n fee was charged as one of the terms of the Land Use C o n t r a c t . 3. Through s u b d i v i s i o n : The C o u n c i l had i n s t r u c t e d t h a t the Approving O f f i c e r f o r the D i s t r i c t c o n s i d e r not g i v i n g approval to s u b d i v i s i o n s where the p a r k l a n d a c q u i s i t i o n fee had not been p a i d . In t h i s case, the parkland a c q u i s i t i o n fee was. one of the c o n d i t i o n s of approval f o r s u b d i v i s i o n . 6.14 THE MUNICIPAL DISTRICT OF DELTA The M u n i c i p a l i t y of D e l t a , l i k e Coquitlam, l e v i e d one fee ($1,000) f o r a l l types o f r e s i d e n t i a l developments. T h i s impost was assessed o n l y i n c o n j u n c t i o n w i t h a l a n d use c o n t r a c t and was disaggregated as f o l l o w s : 55 p e r c e n t 171 of the $1,000 (or $550) was f o r the a c q u i s i t i o n of p u b l i c lands, and the remaining 45 pe r c e n t (or $450) was f o r the purpose of c a p i t a l p r o j e c t s and p u b l i c works ( i . e . , u n s p e c i f i e d impost). 6.15 THE MUNICIPAL DISTRICT OF LANGLEY In the M u n i c i p a l i t y o f Langley, there was one standard per u n i t fee ($1,600) imposed ,upon a l l types of r e s i d e n t i a l development except s i n g l e f a m i l y d w e l l i n g s . In the case o f the s i n g l e f a m i l y d w e l l i n g , the amount of the impost fee was dependent upon the s i z e o f the l o t on which the d w e l l i n g was to be s i t u a t e d . For i n s t a n c e , a standard s i z e urban l o t which was l e s s than 0.5 acres was charged $1,600; a p a r c e l o f land which was comprised of 0. 5 . 1 acre was charged $900; a p a r c e l of land which was comprised of 1 - 2.5 acres was charged $650; and a p a r c e l of l a n d which was comprised of more than 2.5 acres was charged $600. A l l of the monies t h a t were c o l l e c t e d from the i m p o s i t i o n o f the impost fee were p l a c e d i n a g e n e r a l t r u s t fund f o r the f o l l o w i n g purposes: 1. a c q u i s i t i o n of p u b l i c lands; 2. p r o v i s i o n of p u b l i c u t i l i t i e s ; and, 3. p r o v i s i o n o f m u n i c i p a l s e r v i c e s . T h i s fee was l e v i e d with a land use c o n t r a c t or as a c o n d i t i o n f o r s u b d i v i s i o n a p p r o v a l . 6 .'16 THE MUNICIPAL DISTRICT OF MAPLE RIDGE 172 The D i s t r i c t of Maple Ridge had an impost which was c a l l e d a "Community Service Fee". This levy was not disaggregated for s p e c i f i c purposes and was, thus, an unspecified impost, as discussed i n an e a r l i e r section of t h i s Chapter. The Community Service Fee was assessed on the basis of $1,000 per unit for single family dwellings and duplexes. In the case of multiple density units, which were less than 30 units per acre, the $1,000 per unit impost was also applicable. However, i f the density was greater than 30 units per acre, only $700 per unit was assessed. The fee was acquired i n one of three ways: 1. on any rezonings by land use contract, the fees as outlined above, were assessed as one of the conditions of the contract; 2. i f the lands were being rezoned by an amendment to the Zoning By-law, the Community Service Fee was required p r i o r to the f i n a l reading of the amendment; and, 3. for each additional single family l o t being created, the developer entered into a "Subdivision Agreement" which c a l l e d for the payment of'the fee, per unit. 6.17 THE MUNICIPAL DISTRICT OF MATSQUI 173 The D i s t r i c t o f Matsqui had a v a r i a b l e impost fee r a t e s t r u c t u r e which was a p p l i c a b l e o n l y to those developments t h a t r e q u i r e d rezonings through l a n d use c o n t r a c t . As such, i t was a c q u i r e d as one of the c o n d i t i o n s of the c o n t r a c t . The impost fee f o r s i n g l e f a m i l y d w e l l i n g s i n Matsqui was e q u i v a l e n t to 17 percent of the estimated assessed value of the l a n d f o r i t s proposed use. S i m i l a r l y , f o r duplexes, the amount of fee was equal to 17 per c e n t p l u s $225 and, i n the case of m u l t i p l e - d e n s i t y u n i t s , again the 17 percent assessed value was l e v i e d i n a d d i t i o n to $225 per u n i t . The d i s a g g r e g a t i o n of t h i s impost fee i s as f o l l o w s : 1. of the funds c o l l e c t e d from the 17 per c e n t assessment charge, ten percent was a l l o c a t e d to ge n e r a l develop-ment purposes ( i . e . , u n s p e c i f i e d impost) and the remaining seven p e r c e n t was re s e r v e d f o r p a r k l a n d a c q u i s i t i o n or development; and, 2. of the $225 impost assessed a g a i n s t duplexes and m u l t i p l e d e n s i t y u n i t s , $125 was, again, a l l o c a t e d to g e n e r a l development purposes and the remaining $100 was f o r parks. 6.18 THE MUNICIPAL DISTRICT OF MISSION In M i s s i o n , the impost fee was assessed a g a i n s t 174 a l l new r e s i d e n t i a l developments t h a t r e q u i r e d s u b d i v i s i o n through l a n d use c o n t r a c t s - there was no impost on e x i s t i n g l o t s . In the urban areas o f M i s s i o n , the impost fee f o r s i n g l e f a m i l y d w e l l i n g s was $1,250 per l o t . For duplexes and m u l t i p l e d e n s i t y u n i t s , the impost amounted to $1,250 f o r the f i r s t u n i t and $300 f o r each a d d i t i o n a l u n i t . T h i s impost, l e v i e d f o r u n s p e c i f i e d purposes, was d e p o s i t e d i n the M u n i c i p a l i t y ' s "General Improvement Fund". 6.19 THE MUNICIPAL DISTRICT OF RICHMOND Richmond was the f i r s t m u n i c i p a l i t y i n B r i t i s h Columbia to. impose impost f e e s . I t was f i r s t a p p l i e d i n the e a r l y 1960's and was r e f e r r e d to as a "Development Surcharge". At the time of survey, the M u n i c i p a l i t y was imposing impost fees which e q u a l l e d $2,700 per u n i t f o r a l l types o f r e s i d e n t i a l developments. T h i s impost was assessed f o r u n s p e c i f i e d purposes and was a c q u i r e d through land use c o n t r a c t s and s e r v i c i n g agreements. €•.20(3) THE MUNICIPAL DISTRICT OF SURREY The M u n i c i p a l i t y of Surrey began imposing impost fees soon a f t e r i t s i n t r o d u c t i o n by Richmond. I t would appear t h a t the r a t e s t r u c t u r e i n Surrey had been used as a model by s e v e r a l l o c a l i t i e s throughout the P r o v i n c e (e.g., the C i t y of L a n g l e y ) . The r a t e s t r u c t u r e was as f o l l o w s : 175 A DISAGGREGATION OF THE IMPOST FEE IN THE MUNICIPAL DISTRICT OF SURREY Type of Impost Fee Types of R e s i d e n t i a l Development (per l i v i n g u n i t o r a d d i t i o n a l l o t created) S i n g l e Family Duplex Mult. Density M u n i c i p a l N o n - A r t e r i a l Roadway Impost M u n i c i p a l A r t e r i a l Roadway Impost Downstream Drainage F a c i l i t i e s Impost Waterworks Impost A c q u i s i t i o n or Development of P u b l i c Lands Impost n i l or $ 650/unit $ 200/unit $ 300/unit $ 150/unit $ 765 or $ 905/unit n i l or $ 650/unit $ 200/unit $ 300/unit $ 150/unit $ 905/unit n i l o r $ 650/unit $ 2 00/unit $ 300/unit $ 150/unit $1,295/unit T o t a l Amount of Impost Fees .$1,415-$2, 205/unit $1,555 or $2,205/unit $1,945 or $2,595/unit In Surrey, the above noted imposts were assessed as a requirement to d e f r a y e x c e s s i v e c o s t s to the Municipa-l i t y and were a c q u i r e d through la n d use c o n t r a c t s or s e r -v i c i n g agreements. E x t r a c t s from Surrey's "Development P o l i c y " , which p r o v i d e s f u r t h e r i n f o r m a t i o n on the impost fee f o l l o w s . (Note the s i m i l a r i t i e s between the M u n i c i p a l i t y of Surrey "Development P o l i c y " and the C i t y of Langley "Development P o l i c y " . ) 6.20(b) EXTRACTS FROM THE CORPORATION OF THE DISTRICT OF SURREY DEVELOPMENT POLICY APPLICABLE TO THE IMPOST FEE  WHEREAS as a r e s u l t of s u b d i v i s i o n s and developments w i t h i n the M u n i c i p a l i t y , the M u n i c i p a l i t y i s r e q u i r e d to 176 expend e x c e s s i v e funds to meet the demand f o r s e r v i c e s c r e a t e d by a l l s u b d i v i s i o n s and developments. AND WHEREAS the demand f o r s e r v i c e s imposed upon the M u n i c i p a l i t y by every s u b d i v i s i o n or development should be p a i d by the lands c r e a t i n g the demand. NOW THEREFORE the h e r e i n a f t e r s t a t e d p o l i c y s h a l l be e s t a b l i s h e d p o l i c y o f the M u n i c i p a l C o u n c i l o f the Cor-p o r a t i o n o f the D i s t r i c t o f Surrey to meet the demand f o r such s e r v i c e s , so t h a t the M u n i c i p a l i t y s h a l l not be c a l l e d upon to expend e x c e s s i v e funds to meet the s a i d demands cr e a t e d by any s u b d i v i s i o n or development. B. HIGHWAYS (6) M u n i c i p a l N o n - A r t e r i a l Roadway Impost Where a proposed s u b d i v i s i o n or development f r o n t s on an e x i s t i n g roadway (which i s not an a r t e r i a l road) which i s not c o n s t r u c t e d to pr e s e n t M u n i c i p a l s u b d i v i s i o n standards, and which i s not r e q u i r e d by the M u n i c i p a l i t y to be upgraded by the Developer as p a r t o f the s u b d i v i s i o n or development works, the Developer s h a l l pay an impost o f $650.00 f o r each a d d i t i o n a l l o t c r e a t e d or u n i t i n c l u d e d i n the development a b u t t i n g the s a i d roadway, to def r a y the M u n i c i p a l i t y ' s share o f upgrading n o n - a r t e r i a l roads to e x i s t i n g M u n i c i p a l sub-d i v i s i o n standards ... 1 7 7 (7) M u n i c i p a l A r t e r i a l Roadway Impost For the purpose of d e f r a y i n g the e x c e s s i v e c o s t s to the M u n i c i p a l i t y r e q u i r e d f o r the upgrading and improvement o f highways i n the M u n i c i p a l i t y , made necessary by the i n c r e a s e d p o p u l a t i o n and t r a f f i c d e n s i t y c r e a t e d by s u b d i v i s i o n s and developments, the developer o f each s u b d i v i s i o n and development s h a l l pay an impost of $200.00 f o r each a d d i t i o n a l l o t c r e a t e d by the s u b d i v i s i o n or each u n i t i n c l u d e d i n the development ... A l l funds r e c e i v e d by the M u n i c i p a l i t y from such impost s h a l l be h e l d and used by the M u n i c i p a l i t y f o r the upgrading and improvement o f a r t e r i a l highways. C. DOWN-STREAM DRAINAGE FACILITIES ( 1 ) For the purpose o f d e f r a y i n g the e x c e s s i v e c o s t to the M u n i c i p a l i t y of p r o v i d i n g funds r e q u i r e d f o r the upgrading and improvement o f drainage f a c i l i t i e s made necessary by the i n c r e a s e d flow c r e a t e d by s u b d i v i s i o n s and developments, the Developer of each s u b d i v i s i o n and development s h a l l pay an impost of $300.00 f o r each a d d i t i o n a l l o t c r e a t e d by s u b d i v i s i o n or each u n i t i n c l u d e d i n the development ... 178 A l l funds r e c e i v e d by the M u n i c i p a l i t y from such impost s h a l l be h e l d and used by the M u n i c i p a l i t y f o r the purpose of upgrading and i n c r e a s i n g the flow c a p a c i t y of M u n i c i p a l drainage f a c i l i t i e s . E. WATERWORKS (1) For the purpose of d e f r a y i n g the e x c e s s i v e c o s t s to the M u n i c i p a l i t y of p r o v i d i n g funds r e q u i r e d f o r the upgrading and improvement of main trunks and supply f a c i l i t i e s o f the water-works system made necessary by the i n c r e a s e d s e r v i c e requirements c r e a t e d by s u b d i v i s i o n s and developments, the Developer of each s u b d i v i s i o n and development s h a l l pay an impost of $150.00 f o r each a d d i t i o n a l l o t c r e a t e d by the sub-d i v i s i o n o r each u n i t i n c l u d e d i n the develop-ment. . . Provided however, t h a t where such sub-d i v i s i o n or development i s served by a water system s u p p l i e d from a w e l l or w e l l s , i n s t e a d of the M u n i c i p a l water system, no such impost s h a l l be payable to the M u n i c i p a l i t y . A l l funds r e c e i v e d by the M u n i c i p a l i t y from such impost s h a l l be h e l d and used by the M u n i c i p a l i t y f o r the upgrading and improvement of the main supply f a c i l i t i e s of the M u n i c i p a l waterworks system. (2) Where an e x t e n s i o n of a water main passes e x i s -t i n g r e g i s t e r e d l o t s which cannot be s u b d i v i d e d f u r t h e r and/or do not r e q u i r e r e z o n i n g to develop, the developer s h a l l p r o v i d e a water s e r v i c e connection where p r a c t i c a b l e to each l o t . The M u n i c i p a l i t y w i l l reimburse the developer $180.00 f o r each water connection r e q u i r e d under t h i s s e c t i o n . K. ACQUISITION OR DEVELOPMENT OF PUBLIC LANDS For the purpose of d e f r a y i n g e x c e s s i v e c o s t s to the muni-c i p a l i t y of p r o v i d i n g funds r e q u i r e d f o r the a c q u i s i t i o n or development of lands r e q u i r e d f o r parks, playgrounds, r e c r e a t i o n a l and o t h e r p u b l i c use purposes which are needed to serve the i n c r e a s e d p o p u l a t i o n c r e a t e d by sub-d i v i s i o n s and developments, the f o l l o w i n g charges are imposed i n the zones s e t out i n the f o l l o w i n g t a b l e : Zones i n Which Development A u t h o r i z e d Impost Charge RS $ 765.00/unit or a d d i t i o n a l l o t c r e a t e d R - l , R-2, R-3 $ 905.00/unit or a d d i t i o n a l l o t c r e a t e d RM-1, RM-2, RM-3 $1,295.00/unit or a d d i t i o n a l l o t c r e a t e d A l l funds r e c e i v e d by the M u n i c i p a l i t y from such impost s h a l l be h e l d and used by the M u n i c i p a l i t y f o r the a c q u i s i -t i o n or development of lands r e q u i r e d f o r parks, p l a y -grounds, r e c r e a t i o n a l and o t h e r p u b l i c use purposes. SOURCE: The C o r p o r a t i o n of the D i s t r i c t of Surrey Development P o l i cy. -180 6.21(a) THE MUNICIPAL DISTRICT OF WEST VANCOUVER The M u n i c i p a l i t y o f West Vancouver imposed a type of l e v y c a l l e d a " C a p i t a l S e r v i c e s Fee", which attempted to capture a p o r t i o n o f the i n c r e a s e d value o f those l a n d s , which through rezonings or the land use c o n t r a c t were allowed an i n c r e a s e i n d e n s i t y . T h i s l e v y was u n l i k e the impost fees assessed i n the aforementioned communities - which were used to recover a p o r t i o n or a l l o f the m u n i c i p a l c o s t s r e q u i r e d to s e r v i c e new development areas - and, was a l s o d i s s i m i l a r to the d e s c r i p t i o n s t a t e d i n S e c t i o n 4.2 of the main t e x t . However, s i n c e i t was an a d d i t i o n a l f i n a n c i a l requirement assessed upon c e r t a i n developments and sub-d i v i s i o n s f o r an u n s p e c i f i e d purpose, i n t h i s sense i t was a type o f impost f e e . through a land use c o n t r a c t and o n l y assessed a g a i n s t those lands which were allowed an i n c r e a s e i n d e n s i t y - was c a l -Mr. Barnes, a past M u n i c i p a l Manager o f West Vancouver. The formula, which was known as the Barnes Formula, i s as f o l l o w s : The C a p i t a l S e r v i c e s Fee - which was onl y a c q u i r e d c u l a t e d on the b a s i s o f a formula which was developed by Incremental Assessed Value o f Land (x) T o t a l Assessed Value of Taxable Land Current Value o f C a p i t a l X o M u n i c i p a l E q u i t y = S e r v i c e i n A s s e t s Fee When the a p p r o p r i a t e components are imputed i n t o t h i s formula, i t i s s i m p l i f i e d as f o l l o w s : 181 C a p i t a l S e r v i c e Fee = Incremental Assessed X 39.22% Value of Land (x) A d d i t i o n a l i n f o r m a t i o n r e l a t i n g to t h i s formula f o l l o w s , and i s i n the form o f a memo addressed to Mr. G.W. Horwood, D i r e c t o r o f F i n a n c i a l S e r v i c e s , from Mr. I.T. L e s t e r , M u n i c i p a l Manager. 182 €.21(b) EXPLANATION OF THE "BARNES•FORMULA" FOR CALCULATION OF CAPITAL SERVICE FEES - MUNICIPAL DISTRICT OF WEST VANCOUVER J u l y 10, 1976. Memo To: I.T. L e s t e r , M u n i c i p a l Manager. From: G.W. Horwood, D i r e c t o r o f F i n a n c i a l S e r v i c e s . Re: C a p i t a l S e r v i c e Fees - Barnes 1 Formula Up-Date. Updated Formula The formula we have used f o r C a p i t a l S e r v i c e Fees has been updated to b r i n g v a l u a t i o n o f m u n i c i p a l a s s e t s to a c u r r e n t b a s i s and to use the most r e c e n t assessment. F o l l o w i n g the same assumptions and c r i t e r i a used by Barnes, i n d e x i n g a s s e t s owned a t t h a t time, i n c l u d i n g new a s s e t s , the formula to c a l -c u l a t e C a p i t a l S e r v i c e Fee f o r change i n land use would be as f o l l o w s : Incremental Assessed „ , r- T , Cu r r e n t Value of Value o f Land X M u n i c i p a l E q u i t y = T o t a l Assessed Value i n A s s e t s of Taxable Land (x) X $84,964,936 = C a p i t a l S e r v i c e Fee $216,655,141 j so t h a t C a p i t a l S e r v i c e Fee would be equal t o : Incremental Assessed Value o f Land (x) X 39.22% 18 3 The o r i g i n a l formula was: (x) X $49,969,073 or 27.01 s $185,008,510 Increased Percentage The s h a r p l y i n c r e a s e d percentage i s due t o : (a) the assessment r e s t r i c t i o n (net i n c r e a s e 17%); (b) i n c r e a s e i n m u n i c i p a l a s s e t s ( t o t a l 70%) as f o l l o w s ($000) - i n c r e a s e value of 1972 asse t s $27,159 - value of new asse t s a c q u i r e d 1973 to 1975 $ 7,505 - debt repayment l e s s i n c r e a s e d fundings $ 332 $34 ,996 Asset Value 1972 $49,969 Ass e t Value December 1975 $84,965 Asset c a t e g o r i e s are d e t a i l e d and compared on the atta c h e d schedule. O b j e c t i v e s and Assumptions One o b j e c t i v e of r e v i s i n g the formula was to c r e a t e a format whereby the formula c o u l d be updated through i n d e x i n g and a s s e t a p p r a i s a l on a r e g u l a r b a s i s but a t a minimum c o s t . The most accurate way was to r e v a l u e a l l the m u n i c i p a l a s s e t s through a complete a p p r a i s a l which would be p r o h i b i t i v e l y expensive. 70% of the 1972 base a s s e t s c o u l d be indexed or taken d i r e c t l y from our f i n a n c i a l statements and the remainder, 30% c o u l d 184 a l s o be indexed but s u b j e c t to an e s t i m a t i o n of depre-c i a t i o n . The f o l l o w i n g assumptions were used i n a r r i v i n g a t the c u r r e n t v a l u e s of m u n i c i p a l a s s e t s : 1. Land and B u i l d i n g s were, indexed f o l l o w i n g d i s c u s s i o n s w i t h the P r o v i n c i a l Assessment A u t h o r i t y and use of A s s e t Conversion Tables -used by t h a t A u t h o r i t y . My v a l u e s a t t a c h e d to these -Assets were c o n s e r v a t i v e i n a l l cases and because Land and B u i l d i n g s r e p r e s e n t s i n excess, of 72% of the t o t a l value, o f m u n i c i p a l .assets. The e n t i r e v a l u a t i o n of m u n i c i p a l a s s e t s i s t h e r e f o r e c o n s e r v a t i v e . 2. Machinery, and Equipment i s . s e t a t 8 0% of the value of the 1972 a s s e t base p l u s any a d d i t i o n s ; t h i s allowed f o r i n c r e a s e d replacement c o s t , . l e s s d e p r e c i a t i o n , and i s avvery c o n s e r v a t i v e i n t e r p r e t a t i o n of S t a t i s -t i c s Canada's Wholesale P r i c e Index. 3. Land Development Costs - These f i g u r e s were taken as an average' of costs- determined by the Parks and R e c r e a t i o n Department and r e p r e s e n t replacement c o s t of c u r r e n t development. 4. For a d d i t i o n s i n the 1973-75 p e r i o d , I have assumed t h a t the c o s t i s a reasonable measure, f o r v a l u e a t the time of the a d d i t i o n , and have indexed a c c o r d i n g l y and taken estimates of d e p r e c i a t i o n . 5, 185 E q u i t y i n School Assets i s shared 50% with the Pro-v i n c i a l Government, 6. Assets excluded from the value were the same as 1972, i . e . , standard two-lane roads, water d i s t r i b u -t i o n systems and a sewer l a t e r a l system. These are normally a s s e t s p r o v i d e d by the developers. 7, The value of the Sewer P l a n t and I n t e r c e p t o r , and  L i o n s Gate H o s p i t a l , have been c o n s i s t e n t l y assumed as being equal to the debt r e p a i d . 1 8 6 VALUATION OF ASSETS OF THE CORPORATION OF THE DISTRICT OF WEST VANCOUVER OTHER THAN THOSE NORMALLY PROVIDED AS PART OF A SUBDIVISION School D i s t r i c t Land B u i l d i n g s and S t r u c t u r e s Land Development Equipment V e h i c l e s and Machinery Less P r o v i n c i a l Share M u n i c i p a l Share Less Debt School D i s t r i c t E q u i t y Value Dec/72 $ 5,140,000 14,708,000 2,235,000 3,269,000) ) 20,000) Current Value Dec/75 $ 7,840,500 20,350,000 2,979,504 3,156,000 25,372,000 34,326,004 (12,686,000) (17,163,.002) 12,686,000 17,163,002 ( 4,107,768) ( 4,407,692) $ 8 , 5 7 8 , 2 3 2 $ 1 2 , 7 5 5 , 3 1 0 Parks and Re c r e a t i o n Land B u i l d i n g s and S t r u c t u r e s Land Development Equipment V e h i c l e s and Machinery F l o a t s Less Debt M u n i c i p a l E q u i t y $ 1 4 , 9 7 7 , 0 0 0 1 , 0 2 6 , 0 0 0 4 , 6 5 0 , 0 0 0 1 0 3 , 0 9 5 ) ) 3 2 , 3 6 0 ) ) 1 2 , 0 0 0 ) $ 2 9 , 9 9 4 , 0 0 0 2 , 4 4 4 , 0 0 0 6 , 5 1 0 , 0 4 2 4 6 7 , 9 6 4 2 0 , 8 0 0 , 4 5 5 3 9 , 4 1 6 , 0 0 6 ( 8 4 9 , 0 0 0 ) ( 6 0 3 , 0 0 0 ) $ 1 9 , 9 5 1 , 4 5 5 $ 3 8 , 8 1 3 , 0 0 6 Current Value Value M u n i c i p a l Dec./72 Dec./75 Land $ 7,913,000 $14,239,300 B u i l d i n g s and S t r u c t u r e s 3,493,000 4,621,000 Equipment 54 7,990) ) V e h i c l e s and Machinery 414,319) 1,758,218 ) T r a n s p o r t a t i o n V e h i c l e s 610,464) Current Assets and Reserves 4,970,291 8,473,845 T r a f f i c Roadwork Above S u b d i v i s i o n Requirements 395,000 525,000 T r a f f i c S i g n a l s 25,000 5,000 T r a f f i c and S t r e e t Signs 100,000 55,000 Walks and Seawalk 954,000 920,000 Breakwater 55,000 40,000 Water U t i l i t y Supply System 1,403,322 1,984,257 Sewer and P l a n t I n t e r c e p t o r E q u i t y 200,000 300,000 H o s p i t a l s - M u n i c i p a l E q u i t y 358,000 4 75,000 $21,439,386 $33,396,620 T o t a l Value of M u n i c i p a l E q u i t y $49,969,073 $84,964,936 Source: M u n i c i p a l D i s t r i c t o f West Vancouver. 188, APPENDIX 7 MUNICIPAL ACT, SECTION 702C -RELATING TO. DEVELOPMENT COST CHARGES Develop- 702C.(1) The C o u n c i l may by by-law, impose ment Cost development c o s t charges on every person who Charges obt a i n s (a) approval of the s u b d i v i s i o n of a p a r c e l of land under the Land R e g i s t r y A c t or the S t r a t a T i t l e s Act f o r any purpose other than c r e a t i o n of three or l e s s l o t s to p r o v i d e s i t e s f o r a t o t a l of three or l e s s s e l f - c o n t a i n e d d w e l l i n g u n i t s , or (b) a b u i l d i n g permit a u t h o r i z i n g the con-s t r u c t i o n or a l t e r a t i o n of b u i l d i n g s or s t r u c t u r e s f o r any purpose other than the c o n s t r u c t i o n of three or l e s s s e l f -c ontained d w e l l i n g u n i t s , or (c) a b u i l d i n g permit a u t h o r i z i n g c o n s t r u c t i o n , a l t e r a t i o n or ex t e n s i o n o f a b u i l d i n g or s t r u c t u r e , other than a b u i l d i n g or p o r t i o n of i t used f o r r e s i d e n t i a l purposes, where the value of the work exceeds $25,000. (2) Development c o s t charges r e q u i r e d t o be pa i d pursuant to a by-law under t h i s s e c t i o n s h a l l be p a i d p r i o r to the approval o f the sub-d i v i s i o n or the i s s u e of the b u i l d i n g permit, as the case may be. 189 (3) No development c o s t charge s h a l l . b e r e q u i r e d to be p a i d (a) i f a development c o s t charge has p r e -v i o u s l y been p a i d with r e s p e c t to the same development, u n l e s s , as a r e s u l t of a f u r t h e r s u b d i v i s i o n or development, new c a p i t a l c o s t burdens w i l l be imposed on the m u n i c i p a l i t y , or (b) where the s u b d i v i s i o n or development does not impose new c a p i t a l c o s t burdens on the m u n i c i p a l i t y . (4) Development c o s t charges may be imposed under s u b s e c t i o n (1) f o r the s o l e purpose o f p r o v i d i n g funds to a s s i s t the m u n i c i p a l i t y i n paying the c a p i t a l c o s t of p r o v i d i n g , a l t e r i n g , or expanding sewage, water, drainage and h i g h -way f a c i l i t i e s and p u b l i c open space, or any of them, i n order to serve, d i r e c t l y or i n d i r e c t l y , the development i n r e s p e c t of which the charges are imposed. (5) A by-law under s u b s e c t i o n (1) s h a l l p r o -vide a schedule of development c o s t charges and the charges may vary i n r e s p e c t of (a) d i f f e r e n t d e f i n e d or s p e c i f i e d areas or zones, (b) d i f f e r e n t uses, (c) d i f f e r e n t c a p i t a l c o s t s r e l a t e d to any c l a s s of development, and 190 (d) d i f f e r e n t s i z e s or number of u n i t s or l o t s c r e a t e d by or as a r e s u l t o f develop-ment; but otherwise the charges s h a l l be s i m i l a r f o r a l l developments t h a t impose s i m i l a r c a p i t a l c o s t burdens on the m u n i c i p a l i t y . (6) In f i x i n g development c o s t charges i n a by-law under s u b s e c t i o n (1), the C o u n c i l s h a l l take i n t o c o n s i d e r a t i o n whether or not (a) the charges are e x c e s s i v e i n r e l a t i o n to the c a p i t a l c o s t of p r e v a i l i n g standards of s e r v i c e i n the m u n i c i p a l i t y , (b) the charges w i l l d e t e r development i n the m u n i c i p a l i t y , (c) the charges w i l l discourage the c o n s t r u c -t i o n o f reasonably p r i c e d housing or the p r o v i s i o n of reasonably p r i c e d s e r v i c e d land, and (d) the m u n i c i p a l i t y has imposed requirements pursuant to s e c t i o n 702A, 702AA, or 711. (7) A development c o s t charge p a i d to a muni-c i p a l i t y s h a l l be d e p o s i t e d by the m u n i c i p a l i t y i n a separate s p e c i a l development re s e r v e fund e s t a b l i s h e d f o r the a p p r o p r i a t e purpose, and s e c t i o n s 305A and 207(2) apply. (8) The m u n i c i p a l i t y s h a l l use money d e p o s i t e d i n a reserve fund under s u b s e c t i o n (7) together 191 with i n t e r e s t on i t only f o r the purpose f o r which i t was d e p o s i t e d ; namely, (a) a c a p i t a l payment, i n c l u d i n g p l a n n i n g , e n g i n e e r i n g and l e g a l c o s t s , f o r p r o v i d i n g , a l t e r i n g or expanding sewage, water drainage and highway f a c i l i t i e s and p u b l i c open space r e l a t e d d i r e c t l y or i n d i r e c t l y to the development i n r e s p e c t of which a development c o s t charge has been imposed, or (b) the payment of a debt i n c u r r e d as a r e s u l t of an expenditure made f o r the purposes se t out i n paragraph (a), and the payments s h a l l be a u t h o r i z e d by by-law. (9) No by-law under s u b s e c t i o n (1) s h a l l be adopted unless the contents have been approved by the Inspector of M u n i c i p a l i t i e s , who may, i n h i s d i s c r e t i o n and on c o n s i d e r a t i o n of the economic circumstances i n v o l v e d , (a) grant the a p p r o v a l , or (b) r e f u s e to grant approval i f (i) the development c o s t charges are not r e l a t e d to c a p i t a l c o s t s a t t r i -b u t a b l e to p r o j e c t s i n c l u d e d i n a c a p i t a l budget by-law under s e c t i o n 199A, or ( i i ) the c a p i t a l c o s t s s e t out i n the by-law are not r e l a t e d to c a p i t a l 192 p r o j e c t s c o n s i s t e n t with by-laws prepared and adopted under sec-t i o n 697 or 796A, or ( i i i ) the c o n s i d e r a t i o n s s e t out i n sub-s e c t i o n (6) have not been met, or (iv) i n h i s o p i n i o n the by-law does not comply wi t h the s p i r i t and i n t e n t of t h i s s e c t i o n , or (c) w i t h h o l d or revoke the approval u n t i l the terms o f the by-law are a l t e r e d and amended to h i s s a t i s f a c t i o n and i n accordance with h i s d i r e c t i o n s . 193 APPENDIX 8 SAMPLE MUNICIPAL BY-LAW RELATING TO DEVELOPMENT COST CHARGES, AS DRAFTED AND CIRCULATED BY THE PROVINCIAL MINISTRY OF MUNICIPAL AFFAIRS Of BY-LAW NO.  A By-law of the M u n i c i p a l i t y to Impose Development Cost Charges. WHEREAS pursuant to S e c t i o n 702C of the Muni-c i p a l Act the C o u n c i l may, by by-law, impose development c o s t charges under the terms and c o n d i t i o n s of the Sec-t i o n ; AND WHEREAS the development c o s t charges may be imposed f o r the s o l e purpose of p r o v i d i n g funds to a s s i s t the m u n i c i p a l i t y i n paying the c a p i t a l c o s t of p r o v i d i n g , a l t e r i n g , or expanding sewage, water, drainage and highway f a c i l i t i e s and p u b l i c open space or any of them, i n order to serve, d i r e c t l y or i n d i r e c t l y , the development i n r e s p e c t of which the charges are imposed; AND WHEREAS no development c o s t charge s h a l l be r e q u i r e d to be p a i d : (a) i f a development c o s t charge has p r e v i o u s l y been p a i d w i t h r e s p e c t to the same develop-ment, unless as a r e s u l t of a f u r t h e r sub-d i v i s i o n or development, new c a p i t a l c o s t burdens w i l l be imposed on the m u n i c i p a l i t y , or 19:4 (b) where the s u b d i v i s i o n or development does not impose new c a p i t a l c o s t burdens on the m u n i c i p a l i t y ; AND WHEREAS i n the c o n s i d e r a t i o n of C o u n c i l the charges imposed by t h i s By-law: (a) are not e x c e s s i v e i n r e l a t i o n to the c a p i t a l c o s t o f p r e v a i l i n g standards o f s e r v i c e i n the m u n i c i p a l i t y ; (b) w i l l not dete r development i n the muni-c i p a l i t y ; (c) w i l l not discourage the c o n s t r u c t i o n of reasonably p r i c e d housing o r the p r o v i s i o n of reasonably p r i c e d s e r v i c e d land; (d) are not d u p l i c a t i o n of sums al r e a d y c o l -l e c t e d by the m u n i c i p a l i t y pursuant to ,land use c o n t r a c t s , development permits or work r e q u i r e d to be done pursuant to the p r o v i s i o n s o f a s u b d i v i s i o n c o n t r o l by-law; AND WHEREAS i n the o p i n i o n of C o u n c i l the charges imposed by t h i s by-law are: (a) r e l a t e d to c a p i t a l c o s t s a t t r i b u t a b l e to p r o j e c t s i n v o l v e d i n the c a p i t a l budget of the m u n i c i p a l i t y ; (b) r e l a t e d to c a p i t a l p r o j e c t s c o n s i s t e n t with the o f f i c i a l community p l a n ( o f f i c i a l s e ttlement plan) of the m u n i c i p a l i t y ; 19 5 NOW THEREFORE the M u n i c i p a l C o u n c i l of the of i n open meeting assembled enacts as f o l l o w s : ENACTMENT 1. Every person who o b t a i n s : (a) approval of the s u b d i v i s i o n o f a p a r c e l of l a n d under the Land R e g i s t r y Act or the S t r a t a T i t l e s Act f o r any purpose other than the c r e a t i o n of three (3) or l e s s l o t s to pr o v i d e s i t e s f o r a t o t a l of three or l e s s s e l f - c o n t a i n e d d w e l l i n g u n i t s , or (b) a b u i l d i n g permit a u t h o r i z i n g the c o n s t r u c -t i o n or a l t e r a t i o n of b u i l d i n g s or s t r u c -t u r e s f o r any purpose o t h e r than the c o n s t r u c t i o n o f three (3) or l e s s s e l f -c o n tained d w e l l i n g u n i t s , o r (c) a b u i l d i n g permit a u t h o r i z i n g c o n s t r u c t i o n , a l t e r a t i o n , or ex t e n s i o n of a b u i l d i n g or s t r u c t u r e , o t h e r than a b u i l d i n g o r por-t i o n o f i t used f o r r e s i d e n t i a l purposes, where the value of the work exceeds Twenty-Five Thousand D o l l a r s ($25,000.00), s h a l l pay, p r i o r to the approval of the s u b d i v i s i o n or the issuance of the b u i l d i n g permit, as the case may be, to the M u n i c i p a l i t y , the a p p l i c a b l e development c o s t charges as s e t out i n Schedule "A" hereto. 196 READ A FIRST TIME ON THE DAY OF , 1977. READ A SECOND TIME ON THE DAY OF , 1977. READ A THIRD TIME ON THE DAY OF , 1977. APPROVED BY THE INSPECTOR OF MUNICIPALITIES ON THE DAY OF , 19 77. RECONSIDERED AND FINALLY ADOPTED ON THE DAY OF , 1977. Mayor C l e r k I HEREBY CERTIFY the above to be a true copy of BY-LAW NO. as passed a t three r e a d i n g s . C l e r k 197 APPENDIX 9 EXTRACTS FROM A SEMINAR ON "LAND USE CONTROL IN B.C" (19 79) CONDUCTED BY THE CENTRE FOR CONTINUING EDUCATION, THE UNIVERSITY OF BRITISH COLUMBIA APPLICABLE TO THE CALCULATION AND IMPLEMENTATION OF DEVELOPMENT COST CHARGES AS IT RELATES TO THE CITY OF PRINCE. GEORGE Mr. R.M. Dick: I have attached to t h i s paper the Schedule of Development Cost Charges as i t appears i n the C i t y of P r i n c e George Development Cost Charge By-law. You w i l l see t h a t the charges i n t h i s Schedule vary i n r e s p e c t of f u n c t i o n , area and use. At t h i s p o i n t , I propose to o u t l i n e some of the c o n s i d e r a t i o n s which the C o u n c i l of the C i t y o f P r i n c e George took i n t o account i n a r r i v i n g at t h i s Schedule. (i) S e l e c t i n g the Functions S e c t i o n 702C(4) p r o v i d e s t h a t the f u n c t i o n s , f o r which a development c o s t charge may be imposed, are the f o l l o w i n g : 1. sewage f a c i l i t i e s , 2. water f a c i l i t i e s , 3. drainage f a c i l i t i e s , 4. highway f a c i l i t i e s , 5. p u b l i c open space. However, the C i t y of P r i n c e George decided t h a t , i n i t i a l l y a t l e a s t , they would on l y l e v y a development c o s t charge i n r e l a t i o n to (storm) drainage, highways 198 and p u b l i c open space. 1 & 2. S a n i t a r y Sewer and Water F a c i l i t i e s : H i s t o r i c a l l y , i n P r i n c e George, the s a n i t a r y sewer and water f a c i l i t i e s have been s e l f - l i q u i d a t i n g i n the sense t h a t f o r each s p e c i f i e d area a l l annual o p e r a t i n g c o s t s i n c l u d i n g debt repayment have been met from a combination of p a r c e l taxes and user r a t e s . At the pre s e n t time there are 12 u n s p e c i f i e d areas and each has a d i f f e r e n t p a r c e l / u s e r charge r a t e s t r u c t u r e . In view of the pr e s e n t v a r i a t i o n s i n r a t e s and areas, i n -o r d i n a t e care would be r e q u i r e d to maintain e q u i t a b l e charges f o r s i m i l a r f a c i l i t i e s i n d i f f e r e n t areas of the C i t y . That i s to say, i t would r e q u i r e very d e t a i l e d and c a r e f u l c a l c u l a t i o n s i n order to s u b s t a n t i a t e ;the c o s t charges were being c o l l e c t e d because the development c o s t charge areas would c r e a t e o v e r l a p p i n g boundaries with the h i s t o r i c s p e c i f i c areas t h a t were absorbed by the C i t y upon amalgamation. Indeed, i n many cases the new development would take p l a c e i n a s e c t i o n of an e x i s t i n g s p e c i f i e d area, and the development c o s t charges c o l l e c t e d would have to be taken i n t o account i n c a l c u l a -t i n g the r a t e s f o r the new s e c t i o n which would be d i f -f e r e n t from the r a t e s i n the o l d s e c t i o n s o f the same s p e c i f i e d area. In a d d i t i o n to the f o r e g o i n g d i f f i c u l t i e s , the C i t y would be r e q u i r e d to p r o j e c t assessment i n c r e a s e s and j u g g l e c o s t s between e x i s t i n g and f u t u r e users i n regard to the P r o v i n c i a l Government a s s i s t a n c e programs 199 f o r such sewer and water f a c i l i t i e s and, i n the f i n a l a n a l y s i s , the amount of the grants from the Government would be reduced because the r e c e i p t of development c o s t charges f o r such f a c i l i t i e s would reduce the bor-rowing r e q u i r e d to f i n a n c e them. For these reasons the C i t y has i n i t i a l l y excluded s a n i t a r y sewer and water f a c i l i t i e s from the c a l c u l a t i o n of the development c o s t charge. At some time i n the f u t u r e , when there has been some c o n s o l i d a t i o n of these v a r i o u s areas, the C i t y intends to c o n s i d e r i n c l u d i n g such f a c i l i t i e s iri t h a t Schedule. 3« Drainage F a c i l i t i e s : Formerly, under the C i t y ' s E x c e s s i v e Cost P o l i c y (impost f e e s ) , a charge was made i n regard to storm drainage f a c i l i t i e s and i t was decided'to continue t h i s charge under the new system. 4, Highway F a c i l i t i e s : Again, the former impost fees i n c l u d e d an item f o r roads, and the C i t y e l e c t e d to continue t h i s charge f o r new development. However, o n l y roads which are c l a s s e d as e i t h e r " a r t e r i a l " or "major c o l l e c t o r s " w i l l be i n c l u d e d i n the c a l c u l a t i o n s of the development c o s t charge. I t i s i n t e r e s t i n g t h a t the M i n i s t r y has i n d i c a t e d an item f o r o f f - s t r e e t p a r k i n g can be i n c l u d e d i n the c a l c u l a t i o n of the charge f o r highway f a c i l i t i e s . 200. P r i n c e George has not taken o f f - s t r e e t p a r k i n g i n t o account i n i t s road charge as y e t . 5. P u b l i c Open Space: Once more, an item c a l l e d "Parks" was i n c l u d e d i n the o l d P r i n c e George impost fee and has been c a r r i e d forward as P u b l i c Open Space i n the new development c o s t charge. You should note t h a t , even though the m u n i c i -p a l i t y i s r e q u i r i n g a developer to c o n t r i b u t e 5% of h i s land f o r p u b l i c open space under S e c t i o n 711(10), the m u n i c i p a l i t y can s t i l l l e v y a development c o s t charge i n r e s p e c t of a d d i t i o n a l p u b l i c open space i f such charge can be s u b s t a n t i a t e d . ( i i ) S e l e c t i n g the Areas The C i t y of P r i n c e George has been patched together by numerous boundary expansions over the years to encompass p r o p e r t i e s t h a t enjoyed l i t t l e or no s e r -v i c e s . Each expansion was done when the need was acute and the P r o v i n c i a l Government was u n w i l l i n g to p r o v i d e the s e r v i c e s . Then i n 19 75 upon amalgamation, the C i t y b a l l o o n e d to an area of 12 3 square m i l e s . We had thus i n h e r i t e d many water improvement d i s t r i c t s and s e t t l e -ment areas t h a t were unable to p r o v i d e the s e r v i c e s which t h e i r r e s i d e n t s now demanded. A f t e r weeks of heated debate, C o u n c i l r e s o l v e d to supply s e r v i c e s to those " i n need" to the b e s t of the C i t y ' s f i n a n c i a l c a p a b i l i -201 t i e s . The people " i n need" were s c a t t e r e d i n a l l d i r e c t i o n s from the o l d c i t y core and C o u n c i l decided they had to expand the s e r v i c e s i n a l l d i r e c t i o n s . The L e t t e r s Patent i s s u e d to P r i n c e George upon amal-gamation e n t i t l e d C o u n c i l to e s t a b l i s h d i f f e r e n t tax l e v e l s i n v a r i o u s areas of the C i t y and to charge a d i f f e r e n t r a t e f o r water, sewer and garbage i n each s p e c i f i e d area. C o u n c i l has g r a d u a l l y reduced the spread between these v a r i o u s t a x a t i o n l e v e l s and between the v a r i o u s u t i l i t y r a t e s and i t i s now the p o l i c y of the C o u n c i l to s t r i v e f o r "One C i t y , One Tax Rate, One S e r v i c e Charge". In the course o f p r e p a r i n g i t s Development Cost Charge By-law, the C i t y approached V i c t o r i a w i t h the request t h a t the development c o s t charge be a s i n g l e r a t e f o r the e n t i r e C i t y . They were t o l d however, t h a t i t would be i n v i o l a t i o n of the Act. As a r e s u l t , the Schedule of charges i n P r i n c e George now p r o v i d e s t h a t , w h ile the charges f o r highways and p u b l i c open space are uniform over the whole C i t y , y e t the charge f o r drainage i s d i v i d e d i n t o s i x d i s t i n c t areas. B a s i c a l l y , these s i x areas r e p r e s e n t separate storm sewer catchment areas based on the topography of the C i t y . The charge f o r highways and p u b l i c open space i s the same f o r a l l development i n the C i t y on the b a s i s t h a t the r e s i d e n t s of each development w i l l have equal access to a l l p u b l i c open space and to a l l major c o l l e c t o r and a r t e r i a l roads. ( i i i ) S e l e c t i n g the Uses At some p o i n t , each m u n i c i p a l i t y must decide' which uses of land w i l l have to pay a development c o s t charge. In P r i n c e George i t was decided t h a t develop-ments such as P u b l i c I n s t i t u t i o n a l uses (such as School and H o s p i t a l s ) would not have to pay a development c o s t charge. They d i d however, l e v y a charge i n regard to Churches (at the s i n g l e f a m i l y d w e l l i n g r a t e ) . As you w i l l see from the atta c h e d Schedule, P r i n c e George opted to d e s c r i b e the uses i n g e n e r a l terms r a t h e r than employ the myriad of uses i d e n t i f i e d i n our zoning by-law. While t h i s method eases some of the problems i n p r e p a r i n g the development c o s t charge schedule, y e t I t h i n k we can a n t i c i p a t e some d i s p u t e s a r i s i n g i n the a p p l i c a t i o n o f the r a t e s . For example, "warehousing" i s pe r m i t t e d i n both l i g h t and heavy i n d u s t r i a l zones under the P r i n c e George zoning by-law. Since the development c o s t charge by-law i s not t i e d to the zoning by-law, a developer of a warehouse i n one of the l i g h t i n d u s t r i a l zones w i l l want to argue t h a t h i s land use i s "heavy i n d u s t r i a l " f o r the purpose of the development c o s t charge by-law and thus enjoys a lower development c o s t charge r a t e . (iv) S e t t i n g the Rates As mentioned above, the grants which the muni c i p a l i t y r e c e i v e s i n regard to the f a c i l i t i e s from the P r o v i n c i a l Government must be taken i n t o account i n c a l c u l a t i n g the c o s t of such f a c i l i t i e s f o r the purpose s e t t i n g the development c o s t charge r a t e s . For example, the Sewerage F a c i l i t i e s A s s i s t a n c e Act p r o v i d e s t h a t the Government w i l l pay 75% of the amount by which the annual debt charge f o r a sewage system i n a p a r t i c u l a r area exceeds the product of a m i l l r a t e p r e s c r i b e d by regu-l a t i o n on the assessed val u e s of l a n d and improvements i n t h a t area. Only the m u n i c i p a l i t y ' s share of such c o s t s , a f t e r deducting the grant, i s e l i g i b l e f o r i n c l u s i o n i n the c a l c u l a t i o n of the development c o s t charge r a t e . In regard to t h i s c a l c u l a t i o n , i t should be noted t h a t the Deputy M i n i s t e r has d i r e c t e d t h a t the i n t e r e s t p o r t i o n of the annual debt charge must be d i s -counted to p r e s e n t v a l u e s . I t w i l l be i n t e r e s t i n g to see i f some developer ever seeks by c o u r t a c t i o n to recover a refund of a por-t i o n of h i s development c o s t charge on the b a s i s t h a t the m u n i c i p a l i t y underestimated the amount of such P r o v i n c i a l grants i n s e t t i n g the development c o s t charge r a t e and t h e r e f o r e overcharged the developer. In s e t t i n g the r a t e , i t has been suggested t h a t a c a p i t a l p r o j e c t can be i n c l u d e d i n the c a l c u l a t i o n s r i g h t up to the time t h a t c o n s t r u c t i o n i s completed and the p r o j e c t has been commissioned i n t o s e r v i c e i n the m u n i c i p a l i t y . You should note t h a t , while some m u n i c i -p a l i t i e s e l e c t to l i m i t t h e i r C a p i t a l Expenditure 204; Programme to a f i v e year p e r i o d , y e t the p r o v i s i o n s of S e c t i o n 199A only s t a t e t h a t the programme must be f o r at l e a s t f i v e y e a r s . Presumably, there i s n o t h i n g to prevent a m u n i c i p a l i t y from t a k i n g i n t o account c a p i t a l p r o j e c t s f o r a longer p e r i o d of time i n t h e i r programme and then u s i n g such f i g u r e s i n the c a l c u l a t i o n of the development c o s t charge r a t e . In S e c t i o n 702C(6), i t i s p r o v i d e d t h a t one major c o n s i d e r a t i o n i n s e t t i n g the r a t e s w i l l be whether or not the m u n i c i p a l i t y has imposed requirements i n regard to Land Use C o n t r a c t s , Development Permits and -S u b d i v i s i o n C o n t r o l by-laws. One aspect of t h i s con-s i d e r a t i o n seems to be the s i z e of the impost fee formerly charged by the m u n i c i p a l i t y . I t would appear t h a t the L e g i s l a t u r e was seeking to impose some h i s -t o r i c a l c o n s i s t e n c y i n the sums l e v i e d by m u n i c i p a l i t i e s . The other aspect appears to be t h a t C o u n c i l must not l o s e s i g h t of the c o s t burdens which i t i s imposing on -developers. That i s to say, i n order to s a t i s f y the c o n s i d e r a t i o n s e t out i n S e c t i o n 702C(6) the m u n i c i p a l i t y must weigh, not o n l y the development c o s t charge r a t e f o r o f f - s i t e s e r v i c e s , but a l s o the c o s t to the developer of p r o v i d i n g the o n - s i t e s e r v i c e s r e q u i r e d by by-law. C o u n c i l has to s a t i s f y i t s e l f t h a t the t o t a l of a l l c o s t s to the developer w i l l not d e t e r development nor discourage the c o n s t r u c t i o n of reasonably p r i c e d housing or the p r o v i s i o n of reasonably p r i c e d s e r v i c e d l a n d . 205 I t h i n k t h i s approach may be somewhat naive on the p a r t of the Government. While the i n t e n t i s l a u d a b l e , i t i s my b e l i e f t h a t any s a v i n g to be found i n lower development c o s t charges w i l l not be passed on i n t o t a l by the developer to h i s customer. For example, i f the development c o s t charges were c u t i n h a l f by P r i n c e George I do not b e l i e v e t h a t the p r i c e of s e r v i c e d l a n d would drop by t h a t same amount. The demand f o r l o t s would continue unabated and the net r e s u l t would simply be an i n c r e a s e i n the p r o f i t margin of the developer. 1. Rates f o r P u b l i c Open Spaces: S e c t i o n 702C(4) t a l k s of p r o v i d i n g , a l t e r i n g or expanding p u b l i c open space. I t i s not c l e a r whether t h i s l i m i t s the development c o s t charge c a l c u l a t i o n to the c o s t of a c q u i s i t i o n of raw lan d o n l y or whether the c o s t of c l e a r i n g and improvement and the purchase o f , say, playground equipment c o u l d be i n c l u d e d i n the c o s t c a l c u l a t i o n . In the case of P r i n c e George, the r a t e i s l i m i t e d to the c o s t of a c q u i s i t i o n of raw l a n d . T h i s c o s t i s then reduced by an a s s i s t f a c t o r of 10% to account f o r the f a c t t h a t the C i t y h i s t o r i c a l l y p r o v i d e d funds i n i t s annual budget f o r the development and improvement of parks and f o r the f a c t t h a t r e s i d e n t s other than those i n the new development w i l l d e r i v e some b e n e f i t from the p u b l i c open space. 206 2. Rates f o r Highway F a c i l i t i e s ; As mentioned above, P r i n c e George has l i m i t e d i t s development c o s t charge to the p r o v i s i o n of o f f - s i t e a r t e r i a l roads and major c o l l e c t o r s . The t o t a l c o s t of such roads on a c i t y - w i d e b a s i s was s p l i t i n t o three p o r t i o n s r e p r e s e n t i n g the share of such c o s t s to be borne by the m u n i c i p a l i t y , by the M i n i s t r y o f Highways, and by the developer. In t h i s r egard, i t should be noted t h a t not a l l roads are e l i g i b l e f o r 50% c o s t - s h a r i n g w i t h the M i n i s t r y of Highways. For example, a r t e r i a l roads which are f l a n k e d e n t i r e l y by new s u b d i v i s i o n are not e l i g i b l e f o r c o s t - s h a r i n g because the f u n c t i o n of such roads i s to b e n e f i t p r i m a r i l y the new areas through which they run. The m u n i c i p a l i t y ' s share of such t o t a l road c o s t s then forms the b a s i s f o r the c a l c u l a t i o n of the r a t e of the development c o s t .charge f o r roads. In the case of P r i n c e George, we f i r s t reduced t h i s share by 15% to compensate f o r the use of such roads by the r e s i -dents of the C i t y o t h e r than those i n the new areas through which the roads t r a v e l l e d . We then reduced the road c o s t by a f u r t h e r 10% t o take i n t o account the f a c t t h a t the C i t y has h i s t o r i c a l l y a l l o c a t e d a p o r t i o n of i t s annual budget to road improvement and upgrading. 20 7 3. Rates f o r Drainage F a c i l i t i e s : In the C i t y of P r i n c e George, the f o l l o w i n g step-by-step procedure was employed to a r r i v e a t the development c o s t charge r a t e f o r drainage f a c i l i t i e s : (a) d e l i n e a t e the catchment areas; (b) c a l c u l a t e the t o t a l developable land i n each area; (c) p r o j e c t the estimated p o p u l a t i o n growth i n each area; (d) p r o j e c t the development mix i n each area; (e) p r o j e c t the. d e n s i t y of each type of development i n the area; (f) c a l c u l a t e the t o t a l c o s t of f u l l drainage f a c i l i t i e s i n each catchment area; (g) a d j u s t t o t a l p o p u l a t i o n p r o j e c t i o n i n each area to a f i v e - y e a r p r o j e c t i o n ; (h) a d j u s t t o t a l developable lan d i n each area to a f i v e - y e a r p r o j e c t i o n ; (i) a d j u s t t o t a l c o s t of drainage system i n each area to a f i v e - y e a r p r o j e c t i o n ; (j) reduce f i v e - y e a r c o s t p r o j e c t i o n to r e f l e c t b e n e f i t to e x i s t i n g r e s i d e n t s and to f u t u r e r e s i d e n t s a r r i v i n g a f t e r f i r s t f i v e - y e a r p e r i o d ; (k) reduce f i v e - y e a r c o s t p r o j e c t i o n to r e f l e c t a s s i s t f a c t o r of h i s t o r i c a l c o n t r i b u t i o n by the m u n i c i p a l i t y toward o f f - s i t e drainage. In the course of f o l l o w i n g the above procedure, the C i t y of P r i n c e George developed a weighting f a c t o r i n Order to reduce a l l development to an e q u i v a l e n t s i n g l e f a m i l y d w e l l i n g hectare f i g u r e , as f o l l o w s : 208 Type of Development Weighting-Factor S i n g l e Family Dwelling (8.6 l o t s / h a ) 1 M u l t i p l e Family Dwelling (37 units/ha) 3 L i g h t / S e r v i c e I n d u s t r i a l 1.8 Heavy I n d u s t r i a l 0.5 Commercial 10 School, Park and Church 1 E q u i v a l e n t s i n g l e f a m i l y d w e l l i n g h e c t a r e s were then c a l c u l a t e d f o r each type of development, as f o l l o w s : (i) For r e s i d e n t i a l development: No. of d w e l l i n g u n i t s f d e n s i t y x weighting f a c t o r . ( i i ) For a l l other development: area of development T d e n s i t y x weighting f a c t o r . The r e s u l t of t h i s was t h a t we were able to express a l l development i n the form of a common denomi-nator, being the e q u i v a l e n t s i n g l e f a m i l y d w e l l i n g hectare, A S p e c i f i c Example: To show you how a l l of t h i s works i n p r a c t i c e , I w i l l o u t l i n e the c a l c u l a t i o n s t h a t went i n t o the s e t t i n g of the development c o s t charge r a t e s i n r e s p e c t of drainage, roads and open space f o r r e s i d e n t i a l s i n g l e f a m i l y development i n the Nechako area of P r i n c e George. These items appear as the f i r s t l i n e of the Schedule which i s attached to t h i s paper. (i) B a s i c C a l c u l a t i o n s : (1) Nechako was i d e n t i f i e d on the b a s i s of topography as one of s i x separate catchment areas of the C i t y 209 f o r storm drainage purposes. (2) The s t u d i e s made i n c o n j u n c t i o n with the O f f i c i a l Community Plan d i s c l o s e d t h a t : (a) 25% of the p o p u l a t i o n of P r i n c e George w i l l be l o c a t e d i n the Nechako area, (b) the t o t a l f u t u r e p o p u l a t i o n of the Nechako area i s 6 0,000, (c) the annual growth r a t e of the e n t i r e C i t y would be 3.5%, , (d) the r e s i d e n t i a l mix i n Nechako would be 75% s i n g l e f a m i l y and 25% m u l t i p l e f a m i l y , (e) the average household would be 3.5 persons i n new development. (3) Using the above i n f o r m a t i o n , a p o p u l a t i o n i n c r e a s e of 3,752 was p r o j e c t e d i n Nechako f o r the next f i v e y e a r s . (4) Using the l a n d i n v e n t o r y f o r Nechako, together w i t h the development p r o j e c t i o n s and weighting f a c t o r , i t was determined t h a t the development i n Nechako i n the next f i v e years expressed i n E q u i v a l e n t S i n g l e Family D w e l l i n g (ESFD) he c t a r e s would be: S.F.D. 93 ESFD ha. M.F.D. 22 ESFD ha. I n d u s t r i a l 7 ESFD ha. Commercial 6 ESFD ha. School, Church and Park 9.7 ESFD ha. 137.7 ESFD ha. Of the t o t a l developable l a n d i n Nechako (2,200 ESFD ha.), 210 a t o t a l of 137.7 ESFD ha. would be developed i n the next f i v e y e a r s . ( i i ) Drainage C a l c u l a t i o n s : (1) From the "Nechako Stormwater Study (1976)", i t was determined t h a t the c o s t of t o t a l drainage system i n Nechako would be: O f f - s i t e trunk mains $9,042,000 Less 1/6 (CMHC or e q u i v a l e n t ) grant 1,507,000 $7,535,000 Plus allowance f o r i n f l a t i o n s i n c e date of the Study (1976-78) 465,000 $8,000,000 (2) The C a p i t a l Expenditure Programme pursuant to S e c t i o n 199A c a l l s f o r an expenditure of $3,177,000 i n the next f i v e years on drainage i n the Nechako area. (3) Since the 137.7 ESFD ha. w i l l be developed at a time when the C i t y spends $3,177,000 on the storm drainage system, t h e r e f o r e : $3,177,000 T 133.7 = $23,070/ESFD ha. (4) Assuming a s i n g l e f a m i l y d w e l l i n g u n i t d e n s i t y of 8.6 SFD/ha., then: $23,070 T 8.6 = $2,683/dwelling u n i t . (5) The growth i n p o p u l a t i o n i n Nechako f o r the next f i v e years expressed as a % of the f u t u r e t o t a l p o p u l a t i o n i n Nechako i s : 3,753 T 60,000 = 6.25%. (6) The expenditure f o r drainage i n Nechako f o r the next f i v e years expressed as a % of the f u t u r e t o t a l drainage c o s t i n Nechako i s : $3,177,000 f $8,000,000 = 40%. (7) I t would not be e q u i t a b l e f o r 6.25% of the p o p u l a t i o n to bear 40% of the c o s t of drainage because e x i s t i n g r e s i d e n t s and those a r r i v i n g a f t e r the f i v e year p e r i o d w i l l d e r i v e b e n e f i t from the system. Thus, the c o s t i n sub-paragraph (4) above i s m o d i f i e d as f o l l o w s : 6.25 x (1 f 0.40) = 16%, and t h e r e f o r e $2,683/dwelling x 0.16= $423/dwelling u n i t . T h i s was then rounded to $430/dwelling u n i t . (8) Because the C i t y has h i s t o r i c a l l y p r o v i d e d a s s i s t a n c e i n the p r o v i s i o n of o f f - s i t e drainage s e r v i c e s , the i n d i c a t e d r a t e i s f u r t h e r reduced by t h i s h i s t o r i c f i g u r e : $430 x .40 = $172/dwelling u n i t . (9) Thus, the development c o s t charge i n r e s p e c t of drainage f o r the Nechako area i s $172 per d w e l l i n g u n i t . ( i i i ) Road C a l c u l a t i o n s : (1) In t h i s case, the development c o s t charge i s uniform throughout the e n t i r e C i t y . The C a p i t a l Expenditure 212 Programme c a l l s f o r an expenditure i n the next f i v e years as f o l l o w s : C i t y $ 6,459,750 M i n i s t r y of Highways 7,944,250 S u b d i v i s i o n and Developers 3,851,000 $18,255,000 (2) The C i t y ' s share i s then d i v i d e d by the t o t a l E q u i v a l e n t S i n g l e Family Dwelling hectares t h a t are developable i n the e n t i r e C i t y as f o l l o w s : $6,459,750 T 690 = $9,362/ESFD ha. (3) Assuming a d e n s i t y of 8.6 s i n g l e f a m i l y d w e l l i n g u n i t s per h e c t a r e , then: $9,362 i 8.6 = $1,088/dwelling u n i t . (4) Because r e s i d e n t s o t h e r than those i n the new development would d e r i v e b e n e f i t from the roads the i n d i c a t e d c o s t i s reduced by 15%: $1,088 x .85 = $925/dwelling u n i t . (5) Because the C i t y h i s t o r i c a l l y has p r o v i d e d funds i n i t s annual budget f o r the improvement and up-grad i n g of roads, the i n d i c a t e d c o s t i s f u r t h e r reduced by 10%: $925 x .90 = $833/dwelling u n i t . (6) Thus, the development c o s t charge i n r e s p e c t of roads i n the e n t i r e C i t y i s $833 per d w e l l i n g u n i t . 213 (iv) P u b l i c Open Space C a l c u l a t i o n s : (1) The goals and p o l i c y statements of the O f f i c i a l Community Plan s e t an o b j e c t i v e o f 4.9 hect a r e s of p u b l i c open space per 1,000 persons: 0.8 ha/1,00 0 Neighbourhood Parks 1.5 ha/1,000 Community Parks 2.0 ha/1,000 C i t y Park 0.6 ha/1,000 P l a y l o t s 4.9 ha/1,000 T o t a l (2) In s p i t e of these o b j e c t i v e s , i t i s estimated t h a t the C i t y w i l l only purchase 56.5 h e c t a r e s of p u b l i c open space i n the next f i v e y e a r s . The c o s t w i l l be approximately $16,000/hectare, and so: 56.5 x $16,000 = $900,000 t o t a l . (3) The p r o j e c t e d p o p u l a t i o n growth f o r the e n t i r e C i t y f o r the next f i v e years i s 15,356. T h i s w i l l p r o v i d e p u b l i c open space as f o l l o w s : 56.5 T" (15,356 f 1,000) = 3.68 ha/1,000 persons, (4) The t o t a l c o s t o f p u b l i c open space f o r the whole C i t y f o r the next f i v e years d i v i d e d by the t o t a l E q u i v a l e n t S i n g l e Family Dwelling hectares t h a t are developable i n the e n t i r e C i t y i s : $900,000 + 690 = $1,304/ESFD ha. (5) Assuming a d e n s i t y of 8.6 s i n g l e f a m i l y d w e l l i n g u n i t s per h e c t a r e , then: $1,304 f 8.6 = $152/dwelling u n i t . 214 (6) Because the C i t y h i s t o r i c a l l y has p r o v i d e d funds i n i t s annual budget f o r the improvement and up-gr a d i n g of parks, the i n d i c a t e d c o s t i s reduced by 10%: $152 x .90 = $137/dwelling u n i t . (7) Thus, the development c o s t charge i n r e s p e c t of p u b l i c open space i n the e n t i r e C i t y i s $137 per d w e l l i n g u n i t . The Most D i f f i c u l t D e c i s i o n : The problem of d e c i d i n g whether t o ' l e v y the development c o s t charge a t the time o f s u b d i v i s i o n or a t the time of b u i l d i n g permit was a major d i f f i c u l t y t h a t s p l i t the P r i n c e George M u n i c i p a l C o u n c i l i n t o two opposing groups. On the one hand, i t was s a i d t h a t a l l develop-ment c o s t charges i n c l u d i n g those f o r m u l t i p l e f a m i l y , commercial and i n d u s t r i a l uses, should be charged at the time of s u b d i v i s i o n where the development was proceeding by way o f s u b d i v i s i o n , f o r the f o l l o w i n g reasons: (i) We have no way of warning people t h a t the develop-ment c o s t charges remain o u t s t a n d i n g a g a i n s t a par-t i c u l a r p a r c e l o f lan d and there would be an i n e v i t a b l e s h o r t f a l l when, f o r example, a commercial b u i l d e r had arranged h i s mortgage commitment on the b a s i s of the purchase p r i c e of the l a n d and had overlooked the f a c t t h a t a s u b s t a n t i a l sum would have to be p a i d to the C i t y before a b u i l d i n g permit would be i s s u e d , and ( i i ) The C i t y would be paying f o r o f f - s i t e drainage, highways and p u b l i c open space on the b a s i s of the p o t e n t i a l d e n s i t y of development a u t h o r i z e d by the zoning a t the time of s u b d i v i s i o n and, t h e r e f o r e , i f the a c t u a l d e n s i t y of development at the time of b u i l d i n g permit turned out to be l e s s than t h a t a u t h o r i z e d , the C i t y would be unable to recover the intended share of o f f - s i t e development c o s t s . On the other hand, i t was s a i d t h a t , w hile s i n g l e f a m i l y , two f a m i l y and three f a m i l y development should pay a t the time of s u b d i v i s i o n , yet a l l other development should pay a t the time of i s s u e of the b u i l d i n g permit, f o r the f o l l o w i n g reasons: (i) Most people (and i n p a r t i c u l a r , the lawyers) would g r a d u a l l y get used to the i d e a t h a t they would have to a s c e r t a i n from C i t y H a l l whether the development c o s t charge had been p a i d on a p a r t i c u l a r p a r c e l of land. In t h i s regard, the problem was r e a l l y no d i f f e r e n t from the impost fee system which people e v e n t u a l l y l e a r n e d to cope with. ( i i ) I t would be p r o h i b i t i v e l y expensive f o r a s u b d i v i d e r to c r e a t e m u l t i p l e f a m i l y , commercial and i n d u s t r i a l p a r c e l s i f he had to pay the development c o s t charge f o r each upon s u b d i v i s i o n , unless he had a purchaser w a i t i n g f o r each p a r c e l who was ready to develop the p a r c e l immediately. 216 The l a t t e r group of Aldermen won the argument on the b a s i s of 702C(6) (b) by c o n v i n c i n g the former group t h a t to impose a development c o s t charge on m u l t i p l e f a m i l y , commercial or i n d u s t r i a l development a t the time o f s u b d i v i s i o n would d e t e r development i n the m u n i c i p a l i t y and would a r t i f i c a l l y l e s s e n the supply of s e r v i c e d p a r c e l s of lan d f o r such purposes. Robert M. Dick, Wilson, King and Company, P r i n c e George, B.C. A p r i l , 1979. DEVELOPMENT COST CHARGES A. Nechako Area CHARGE FOR Land Use Storm Drainage Roads Open Space T o t a l R e s i d e n t i a l ( S i n g l e Family Dwelling) - per l o t $ 172. 00 $ 833. 00 $ 137. 00 $ 1,142. 00 R e s i d e n t i a l (Two Family Dwelling) - per l o t $ 240. 00 $ 1,161. 00 $ 191. 00 $ 1,592. 00 R e s i d e n t i a l (Three Family Dwelling) - per l o t $ 360. 00 $ 1,741. 00 $ 287. 00 $ 2,388. 00 R e s i d e n t i a l ( M u l t i p l e Family Dwelling' 37 Dwelling U n i t s per Hectare o r Less) - per d w e l l i n g u n i t $ 120. 00 $ 580. 00 $ 96, 00 $ 796. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 38 to 74 Dwelling U n i t s per Hectare) - per d w e l l i n g u n i t $ 103. 00 $ 500. 00 $ 82. 00 $ 685. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 75 Dwelling U n i t s per Hectare o r More) - per d w e l l i n g u n i t $ 86. 00 $ 417. 00 $ 68. 00 $ 571. 00 Commercial - per square metre of gross f l o o r area $ 1. 97 $ 9. 55 $ 1. 57 $ 13. 09 L i g h t or S e r v i c e I n d u s t r i a l - per hectare o f gross s i t e area $ 2,663. 00 $12,895. 00 $ 2,120. 00 $17,678. 00 Heavy I n d u s t r i a l - per hec t a r e o f gross s i t e area $ 740. 00 $ 3,580. 00 $ 591. 00 $ 4,911. 00 I n s t i t u t i o n a l (Churches) $ 172. 00 $ 833. 00 $ 137. 00 $ 1,142. 00 DEVELOPMENT COST CHARGES ,B'. Bowl Area CHARGE FOR Land Use Storm Drainage Roads Open Space T o t a l R e s i d e n t i a l ( S i n g l e Family Dwelling) - per l o t $ 24.00 $ 833, 00 $ 137. 00 $ 994. 00 R e s i d e n t i a l (Two Family Dwelling) - per l o t $ 34.00 $ 1,162. 00 $ 190. 00 $ 1 ,386. 00 R e s i d e n t i a l (Three Family Dwelling) - per l o t $ 50.00 $ 1,742. 00 $ 287. 00 $ 2 ,079. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 37 Dwelling U n i t s per Hectare o r Less) - per d w e l l i n g u n i t $ 17.00 $ 580. 00 $ 96. 00 $ 693. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 38 to 74 Dwelling U n i t s per Hectare) - per d w e l l i n g u n i t $ 14. 00 $ 500. 00 $ 82. 00 $ 596. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 75 Dwelling U n i t s per Hectare or More) - per d w e l l i n g u n i t $ 12.00 $ 416, 00 $ 69. 00 $ 497. 00 Commercial - per square metre of gross f l o o r area $ .28 $ 9. 55 $ 1. 57 $ 11. 40 L i g h t o r S e r v i c e I n d u s t r i a l - per hectare of gross s i t e area $ 372.00 $12,900. 00 $ 2,115. 00 $15 ,387. 00 Heavy I n d u s t r i a l - per hec t a r e of gross s i t e area $ 103.00 $ 3,580. 00 $ 591. 00 $ 4 ,274. 00 I n s t i t u t i o n a l (Churches) $ 24.00 $ 833. 00 $ 137. 00 $ 994. 00 DEVELOPMENT COST CHARGES C. Cranbrook H i l l CHARGE FOR Land Use Storm Drainage Roads Open Space T o t a l R e s i d e n t i a l ( S i n g l e Family Dwelling) - per l o t $ 136. 00 $ 833. 00 $ 137. 00 $ 1,106. 00 R e s i d e n t i a l (Two Family Dwelling) - per l o t $ 190. 00 $ 1,162. 00 $ 191. 00 $ 1,542. 00 R e s i d e n t i a l (Three Family Dwelling) - per l o t $ 284. 00 $ 1,742. 00 $ 287. 00 $ 2,313. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 37 Dwe l l i n g U n i t s per Hectare o r Less) - per d w e l l i n g u n i t $ 95. 00 $ 581. 00 $ 95. 00 $ 771. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 38 to 74 Dwel l i n g U n i t s per Hectare) - per d w e l l i n g u n i t $ 82 . 00 $ 500. 00 $ 82. 00 $ 664 . 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 75 Dwe l l i n g U n i t s per Hectare o r More) - per d w e l l i n g u n i t $ 68. 00 $ 416. 00 $ 69. 00 $ 553. 00 Commercial -f l o o r area • per square metre of gross $ 1. 56 $ 9. 55 $ 1. 57 $ 12. 68 L i g h t o r S e r v i c e I n d u s t r i a l - per hec t a r e of gross s i t e area $ 2,106. 00 $12,892. 00 $ 2,123. 00 $17,121. 00 Heavy I n d u s t r i a l - per hectare o f gross s i t e area $ 585. 00 $ 3,581. 00 $ 590. 00 $ 4,756, 00 I n s t i t u t i o n a l (Churches) $ 136. 00 $ 833. 00 $ 137. 00 $ 1,106, 00 -DEVELOPMENT COST CHARGES D. South West CHARGE FOR Land Use Storm Drainage Roads Open Space T o t a l R e s i d e n t i a l ( S i n g l e Family Dwelling) - per l o t $ 37. 00 $ 833. 00 $ 137. 00 $ 1,007. 00 R e s i d e n t i a l (Two Family Dwelling) - per l o t $ 52. 00 $ 1, 161. 00 $ 191. 00 $ 1,404. 00 R e s i d e n t i a l (Three Family Dwelling) - per l o t $ 77. 00 $ 1, 742 . 00 $ 287. 00 $ 2,106. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 37 Dwelling U n i t s per Hectare or Less) - per d w e l l i n g u n i t $ 26. 00 $ 581. 00 $ 95. 00 $ 702. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 38 to 74 Dwelling U n i t s per Hectare) - per d w e l l i n g u n i t $ 22. 00 $ 500. 00 $ 82. 00 $ 604. 00 R e s i d e n t i a l ( M u l t i p l e Family Dwelling 75 Dwelling U n i t s per Hectare or More) - per d w e l l i n g u n i t $ 18. 00 $ 417. 00 $ 69. 00 $ 504. 00 Commercial - per square metre of gross f l o o r area $ • 43 $ 9. 55 $ 1. 57 $ 11. 55 L i g h t or S e r v i c e I n d u s t r i a l - per hectare of gross s i t e area $ 573. 00 $12, 895. 00 . $ 2,120. 00 $15,588. 00 Heavy I n d u s t r i a l - per h e c t a r e of gross s i t e area $ 159. 00 $ 3, 582. 00 $ 589. 00 $ 4,330.00 I n s t i t u t i o n a l (Churches) $ 37. 00 $ 833. 00 $ 137. 00 $ 1,007. 00 to to o DEVELOPMENT COST CHARGES E. Blackburn CHARGE FOR Land Use Storm Drainage Roads Open Space T o t a l R e s i d e n t i a l ( S i n g l e Family Dwelling) - per l o t $ 189. 00 $ 833. 00 $ 137. 00 $ 1,159. 00 R e s i d e n t i a l (Two Family Dwelling) - per l o t $ 263. 00 $ 1,162. 00 $ 191. 00 $ 1,616. 00 R e s i d e n t i a l (Three Family Dwelling) - per l o t $ 395. 00 $ 1,742. 00 $ 287. 00 $ 2,424. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 37 Dwelling U n i t s per Hectare o r Less) - per d w e l l i n g u n i t $ 132. 00 $ 581. 00 $ 95. 00 $ 808 . 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 38 to 74 Dw e l l i n g U n i t s per Hectare) - per d w e l l i n g u n i t $ 113. 0 0 $ 500. 00 $ 82. 00 $ 695. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 75 Dwe l l i n g U n i t s per Hectare o r More) - per d w e l l i n g u n i t $ 95. 00 $ 417. 00 $ 68. 00 $ 580 . 00 Commercial -f l o o r area - per square metre of gross $ 2. 17 $ 9. 54 $ 1. 57 $ 13. 28 L i g h t or S e r v i c e I n d u s t r i a l - per hec t a r e of gross s i t e area $ 2,926. 00 $12,895. 00 $ 2,120. 00 $17,941. 00 Heavy I n d u s t r i a l - per hec t a r e of gross s i t e area $ 813. 00 $ 3,5 82. 00 $ 589. 00 $ 4,984. 00 I n s t i t u t i o n a l (Churches) $ 189. 00 $ 833. 00 $ 137. 00 $ 1,159. 00 DEVELOPMENT COST CHARGES F. B.C.R. CHARGE FOR Land Use Storm Drainage Roads Open Space T o t a l R e s i d e n t i a l (Single Family Dwelling) - per l o t $ 77. 00 $ 833.00 $ 137. 00 $ 1,047. 00 R e s i d e n t i a l (Two Family Dwelling) - per l o t $ 107. 00 $ 1,162.00 $ 191. 00 $ 1,460. 00 R e s i d e n t i a l (Three Family Dwelling) - per l o t $ 161. 00 $ 1,742.00 $ 287. 00 $ 2,190. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 37 Dwe l l i n g U n i t s per Hectare o r Less) - per d w e l l i n g u n i t $ 54. 00 $ 581.00 $ 95. 00 $ 730. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 38 to 74 Dwel l i n g U n i t s per Hectare) - per d w e l l i n g u n i t $ 46. 00 $ 500.00 $ 82 . 00 $ 628. 00 R e s i d e n t i a l ( M u l t i p l e Family D w e l l i n g 75 Dwe l l i n g U n i t s per Hectare or More) - per d w e l l i n g u n i t $ 38. 00 $ 417.00 $ 69. 00 $ 524 . 00 Commercial -f l o o r area • per square metre of gross $ 90 $ 9.50 $ 1. 60 $ 12. 00 L i g h t or S e r v i c e I n d u s t r i a l - per hectare of gross s i t e area $ 1,192. 00 $12,895.00 $ 2,121. 00 $16,208. 00 Heavy I n d u s t r i a l - per hectare o f gross s i t e area $ 331. 00 $ 3,582.00 $ 589. 00 $ 4,502. 00 I n s t i t u t i o n a l (Churches) $ 77. 00 $ 833.00 $ 137. 00 $ 1,047. 00 to to to 

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