Developers believe in paying full share

Hey there, time traveller!
This article was published 09/03/2016 (3535 days ago), so information in it may no longer be current.

‘Growth must pay for growth.”

This mantra by Mayor Brian Bowman at the state of the city address and repeated by architect Brent Bellamy (Sprawl fees ease growing pains, March 7) has been stated by the residential development industry long before either were in their current positions.

While Bellamy correctly states new growth pays for 100 per cent of all infrastructure within the subdivision plus 50 per cent of the cost of exterior arterial roads, he contends additional funding from development should be acquired for schools, community centres, libraries, transit, snow-clearing, fire and police protection, all the while admitting the above listed quality of life amenities are found in other existing neighbourhoods paid for by property taxes; property taxes generally considerably less than those charged in new neighbourhoods.

First, as we all know, schools are under the jurisdiction of the provincial government with their own significant taxation authority, and are not a municipal issue. Notwithstanding, it should be noted developers are required to make school sites available to the province at significantly reduced cost.

Second, Bellamy refers to a 2004 analysis prepared by the City of Winnipeg that projected the net present value of the benefits flowing to the City of Winnipeg from Waverley West over an 80-year period would be $70 million. There were a number of concerns about the validity of the city’s 2004 analysis, but rather than argue about a 12-year-old report, we can reference an independent, third-party report by MMM Group Ltd. in 2013. The 2013 report forecasts the net present value of Waverley West to the City of Winnipeg to be $247.3 million. We note that net benefit is calculated after full recovery of the city’s capital costs related to the extension and improvement of Waverley Street, Bison Drive, Kenaston Boulevard, police, fire and paramedic services, transit and a $39.4-million contribution toward a multi-regional recreation centre.

Many contend new neighbourhoods contribute to sprawl and reduce population density in the city. Looking at recent building trends, the exact opposite is true. For decades within Winnipeg, single family new home starts comprised more than 80 per cent of all residential construction. Therefore, existing neighbourhoods such as River Heights, Fort Rouge, St. Boniface, West Kildonan and Transcona were almost exclusively single-family detached housing. About 10 years ago, that number was reduced to less than two-thirds single family and one-third multi-family (condominiums, row homes, town homes, apartments). Five years ago, the numbers were 50/50, and this past year multi-family starts comprised 68 per cent of all Winnipeg new home starts, while single-family detached made up 32 per cent. Given the vast majority of these starts are in new neighbourhoods, it appears new subdivisions have considerably greater population density than older neighbourhoods. Infill housing could help densify these older areas of town if not for the resistance from those living there and the councillors who represent them.

Much of Winnipeg’s infrastructure deficit comes from older neighbourhoods. Let’s face it: Winnipeg has the third-oldest housing stock in Canada. It only makes sense it may therefore have the third-oldest infrastructure within that housing stock area. However, it is hardly the responsibility of new development to pay for the failing infrastructure of older areas, but that is certainly what is currently happening.

If new development is paying more than twice as much in property taxes as most of the older established neighbourhoods and wanting similar quality of life amenities (but often not receiving them for extended time periods), then either new is helping subsidize old or new is placing substantially less of a drain on city coffers than old.

One of the primary reasons for Unicity amalgamation in 1972 was to allow the City of Winnipeg to reap the financial benefits of a growing outlying community. Things have not changed that much. Original Winnipeg still benefits financially from new growth.

Bellamy refers to Waverley West as an isolated, car-dependent suburb that is responsible for the Waverley underpass, the Kenaston underpass and the widening of Kenaston. Furthermore, he contends easier access to greater distances on these roads make new subdivisions within and outside Winnipeg even more attractive options.

Really? The University of Manitoba has been located farther away from downtown Winnipeg than much of Waverley West for 96 years. Tens of thousands of people travel from all over the city to the U of M every day to go to school and to work, yet no one is suggesting the university is responsible for urban sprawl and should be paying for the improvement of all roads and bridges leading south. That, of course, would be ridiculous.

There are retail power centres at the corners of Kenaston Boulevard and Sterling Lyon Parkway and Kenaston and McGillivray Boulevard. These retail destinations are meant to attract shoppers from all over the city and from cities outside of Winnipeg. Many roads lead to these centres. Did the city impose fees on all of these retail outlets for the increased wear and tear on these roads? Of course not. As a matter of fact, in some cases, it provided incentives to locate there.

Obviously, homeowners in Waverley West are not the only people who use Waverley Street and Kenaston Boulevard. As a matter of fact, I live in Charleswood and drive on both Waverley and Kenaston every day to and from work. Has anyone proposed a tax on Charleswood, River Heights, Fort Garry, Tuxedo, St. James, Fort Richmond and St. Norbert residents who use these streets every day? Of course not. It’s far easier to single out those who have not yet purchased a house, established a neighbourhood, cast a vote or driven a car on these streets than on those who currently do and have been doing so for decades.

The industry is currently engaged with the City of Winnipeg administration in a review of how development agreements are structured. The purpose of the review is to ensure growth pays for growth. While there are likely areas where improvements can be made, portraying new development as the source of the city’s infrastructure woes is simply not true and is offensive to the residents of these neighborhoods whose tax dollars contribute significantly to the success of the city.

Mike Moore is president of the Manitoba Homebuilders Association.