Council Meeting: Development Charge Reduction Program Decision

Council reviewed staff report ES 3626 on a provincial development-charge reduction funding program and voted not to participate. The discussion focused on how much residential development charges would have to be reduced, the timing mismatch between upfront reductions and later reimbursements, and the risk that the town would have to cover costs if housing uptake exceeded forecasts or if a proposed community centre and library project did not meet provincial timelines.

Topics Discussed

1. PROVINCIAL DEVELOPMENT CHARGE PROGRAM

Staff presented a provincial program with a near-term application deadline that would require municipalities to reduce residential development charges by at least 30 percent from rates in effect on March 30. The province would fund up to five projects per municipality, with projects needing to be tendered by July 2030 and completed by October 2035. Treasurer said, "There's still some areas that I would call some gray areas as to exactly how to interpret what it'll look like." Staff said those details would likely need to be clarified later through a transfer payment agreement.

2. FINANCIAL RISK AND CASH-FLOW EXPOSURE

Staff said the program would require the town to front-load the development-charge reductions and recover funding over time. Treasurer John Challinor II said, "we will have to do something in the cash flow to fund the exemptions that we're providing until we got reimbursement for them." He added that the main risk was not just timing, but the possibility of not being fully repaid: "if we see more uptake in the next three years than we project, if that exceeds the funding we receive, that needs a funding source other than DC. So, that's where we get back to a taxpayer impact."

Councillor Rick Malboeuf said the larger concern was the project-linked reimbursement model: "The second risk we talked about is the risk of the project itself. And in my mind, this is the bigger risk because if for any reason we we aren't reimbursed after we've already upfront reduced the development charges, you know, that creates the biggest potential risk to the taxpayer."

3. SCALE OF DEVELOPMENT CHARGE REDUCTIONS

Council heard that the modeled reductions would lower residential development charges by roughly 32 to 33 percent in 2026 and 40 to 47 percent in 2027 and later years. Staff also reviewed the town's development-charge reserves. Challinor said, "The key takeaway here is that you can see parks and recreation make up almost half of our current development charge rate." He also noted that parks and recreation reserves were among the strongest positive balances in the forecast, at about $132 million rising to $186 million.

4. HOUSING FORECASTS AND MUNICIPAL LIABILITY

Council reviewed projected housing activity over the next three years and compared it with the larger development pipeline. Staff said the risk to the town would increase if actual construction outpaced the forecast used in the funding application. Challinor said, "So, you know, the risk here to the program is really that if we see more uptake in the next three years than we project, if that exceeds the funding we receive, that needs a funding source other than DC."

Councillor George Minakakis questioned the housing forecast, pointing to a dip in one year of the projection: "I noticed 2026, we got roughly 800 there. And then 2027, which is not all that far away, it really takes a real drop. And then of course 2028, uh we're up to 1,800 roughly. So I just wonder what that 2027 would really indicate."

Minakakis also argued the program was not necessary for Milton's market, saying, "I also view this program to be nothing more than a stimulus package."

5. PROJECT OPTIONS AND COUNCIL'S DECISION

Council discussed whether to tie an application to a proposed community centre and library project. Staff said that option carried substantial timing risk because the project might not be ready to tender by the provincial deadline. Councillor Sammy Ijaz summarized that concern, saying, "One of the key risks identified in the report is that the town could provide the DC reductions but not receive the full reimbursement if the community center and library project does not meet the province's required timelines."

Malboeuf said the scale of the exposure made the decision straightforward: "If we're looking at it from managing the risk to the taxpayer perspective, the timing of that community center and library is a major risk... Option two is the only way to ensure that the risk is minimized for taxpayers."

Minakakis said Milton had already contributed significantly to housing supply, stating, "Milton over the past 25 years have done our fair share and more than our fair share with regards to housing in this province here." Council then chose Option Two, declining to participate in the program.

Motions

Passed unanimously: - Option Two — Declined participation in the provincial development-charge reduction program. - Authorization for the mayor and town clerk to sign the bylaws, affix the corporate seal, and record them in the bylaw book. - Bylaw 045-2026 - Bylaw 046-2026

Attendees

• Mayor Gordon Krantz
• Councillor Sameera Ali
• Councillor Colin Best
• Councillor Sammy Ijaz
• Councillor Adil Khalqi
• Councillor Rick Malboeuf
• Councillor George Minakakis
• Councillor Sarah Marshall