Szeredi: City of Ottawa must make development charges work for us all

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City processes for collecting and spending billions of dollars of development charges must be updated and improved to reflect the reality of new development or redevelopment within existing areas of the city — or “intensification,” as it’s colloquially known.

Developers pay these charges to the city to offset the infrastructure costs of facilities and services such as public transit, parks, community centres and libraries. The idea is that development-related population growth should pay for the growth of development-related city services. This, of course, makes eminent sense.

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However, there are a few problems with the way the formula is applied in Ottawa.

One problem is that development charges are not proportionally collected and spent in the areas undergoing the most intensification. Examples include the Smyth/St. Laurent corridor, with 11 new high-rises planned within a one-kilometre stretch, and the Carling/Highway 417 corridor, where 17 high-rises are planned.

The city’s Official Plan envisions areas like these as “15-minute neighbourhoods,” but without proportional development-charge funding for local parks, transit, community centres and libraries, this will not happen. Instead, these developments run the risk of overwhelming surrounding communities and breeding resentment.

Another problem is that in the past growth was focused on “greenfield” developments where brand-new neighbourhoods were created from scratch in the suburbs, and development charges funded new transit stations, storm sewers, parks, community centres and libraries.

However, greenfield development is not the only source of growth in 2024. The reality is that there is an increasing amount of “intensification” in existing neighbourhoods, and it is accelerating. In fact, the city’s Official Plan calls for the majority of future development to occur through intensification.

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Intensification in existing neighbourhoods usually doesn’t require brand-new infrastructure; rather, it requires additions or enhancements to existing facilities and services. Unfortunately, development-charge collection and spending continue to be focused on new infrastructure to the detriment of established communities now facing significant and rapid population growth.

Libraries are a great example. Currently, the city collects development charges in the outer greenbelt suburbs to fund the construction of new libraries. However, the city does not collect development charges in the inner greenbelt to fund additions to existing libraries. This, despite acknowledgement by the city that inner greenbelt libraries have no excess capacity to absorb new residents.

Yet another problem is the inability of development charges to keep pace with the rapid rate of change. Development charge rates and spending are based on the city’s “Official” and “Master” plans. Currently the city’s Master Plans are updated about every 10 years while development charges are updated about once every five years. These long update periods mean that development-charge updates may be based on plans that are nearly a decade old — a cadence far too glacial to address the rapid intensification taking place today. As an example, all of the Smyth/St Laurent corridor and Carling/Highway 417 corridor intensification developments have arisen in the past 10 years, so none of them may be reflected in Master Plans that are already 10 years old. The city can and must find a more agile process.

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Finding a long-term solution to all of these issues could be part of the development charges review process currently underway. But only if the city chooses to act.

If not, it will not only fail developers (who expect development charges to be used to provide quality local services), but also new residents dependent on local services and current residents who fear the quality of existing services will suffer under new and unprecedented demand pressures.

It is in the city’s power and interest to avert this failure and use the development charges review to drive thoughtful and farsighted intensification with the requisite local services and amenities.

Tomas Szeredi is a resident of Elmvale Acres and president of the Elmvale Acres Community Association in Ottawa.

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