By Pepper Parr
October 9th, 2024
BURLINGTON, ON
Michael Patrick Moffatt is a Canadian economist and professor of Business, Economics, and Public Policy. He served as director of policy and research at Canada 2020, a progressive Canadian think-tank. He is also an assistant professor at Ivey Business School.
How much have the developers paid in the way of development Charges and how much of that money have the municipalities spent?
Housing expert MIKE MOFFATT ran the numbers — “In 2022, the last year we have data for, Ontario municipalities collected $4 billion in development charges, but spent less than $3 billion of those funds.
In total, Ontario municipalities collectively have over $10 billion in unspent DCs.” That cash goes toward housing-enabling infrastructure like sewage and road systems.
Burlington’s development charges reserve fund balances are shown in the 2023 financial statements. The financial statements were released in August (2024).
Have a look at the top of page 15
https://www.burlington.ca/en/council-and-city-administration/resources/Budget-and-Finances/Financial-Statements/2023-City-of-Burlington-Financial-Statement.pdf
The report shows
$83,457,000 in “Deferred revenue – obligatory reserve fund” Development charges
$10,957,000 in “Deferred revenue – obligatory reserve fund” Parkland.
The change in development charges 2022 to 2023 is +$36,329,000
So, in 2016 the special purpose tax levy for the expansion of the Jo Brant hospital was quietly converted to an ongoing infrastructure tax levy. It was to be used for such things as sewers and roads, both capital and operational funding requirements. I have asked previously (and received no response) where categorically these funds were spent from 2016 to the present day. I would hope that there is an audit trail.
Now we find that municipalities writ large have been sitting on a massive amount of captured development charges. I think that it is entirely appropriate for the City to disclose the quantum of development charges that they have received, how much has been spent and how the residual (if any) is committed. It is budget time, after all, and these funds would seem to be a significant component of the overall equation.
Perhaps BRAG can get the answers.