Council turned down a request by a local developer to extend the deadline for payment of development charges until after construction is complete.
At the council meeting on April 8, council received a letter from Dunncap to request a partial deferral of the town’s development charges on the Holiday Inn Express and Suites project slated for Collingwood’s east end at 500 Hume Street.
Development charges are due when a building permit is issued. Dunncap requested a 14-month deferral, asking for permission to pay the fees once an occupancy permit is issued and the inn can be opened to guests. The letter stated Dunncap would begin construction this spring, and expect to be ready for occupancy 14 months later.
Treasurer Marjory Leonard said this isn’t the first request of its kind. In fact, the town granted a deferral of 50 per cent of the town-wide development charges due from the Georgian Biomed project (a medical marijuana facility being built on Mountain Road) for five years at the request of the developer. That request was granted in 2016. Other similar agreements exist between the town and local Habitat for Humanity builds and the Collingwood Youth Centre. In those cases, the town deferred development charges until the buildings are sold or the uses change. In the case of Biomed’s agreement, the town required a letter of credit from the developer and registration on title to ensure the charges would be paid in the future.
“No one, if they don’t have to, wants to pay their taxes or charges. If they can be deferred at any time there is always better use for funds,” said Councillor Yvonne Hamlin. “I believe if we start a process of allowing individual developers to come forward and seek a deferral of development charges to some other timeframe that we will have a lineup of such requests.”
Hamlin said she would not support a one-off deferral, and instead suggested staff bring forward a report on a formal development charge deferral request policy.
Councillor Bob Madigan said he needed more clarity on the matter, including whether Dunncap would be paying 2019 development charges 14 months down the road, or if the developer would have to pay 2021 development charges at the time.
Councillor Mariane McLeod asked for the dollar value of the development charges on the Holiday Inn project. Leonard said they haven’t been calculated yet, as the amount is based on gross floor area for commercial projects.
“I would further state it is a commercial development and, at this point, we are heavily reliant on residential taxpayers to foot the tax bill, and if this didn’t go ahead it may have financial repercussions in the future on the town,” said Leonard.
The letter requesting a deferral for the Holiday Inn project came from Kenneth Hale, vice president of land development and acquisitions for Dunncapp. He did not respond to a request for comment from CollingwoodToday.
Councillor Kathy Jeffery and Deb Doherty, along with Mayor Brian Saunderson, were the only yes votes for the deferral request. Deputy Mayor Keith Hull was not at the meeting, and Councillors Tina Comi, Madigan, McLeod, Hamlin, and Steve Berman voted against the request.
Council did vote unanimously in favour of having staff prepare a report on a formal policy for development charge deferral requests. The staff report will be presented at a future council meeting.