Development Cost Charges

Development Cost Charges Bylaw



Those fees to be levied per lot, or per square meter of new development, for services such as drainage, parks, roads, sewer and water, are established under the City of West Kelowna's Development Cost Charge Bylaw No. 0190.

Council adopted the new bylaw at the June 28, 2016 meeting.
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All in-stream subdivision, zoning amendment, development permit, and building permit applications were given a period of one year from the date of adoption of the bylaw to be completed under the terms of the previous bylaw, provided that all required forms were complete and submitted on or before the date of adoption.

Completed means DCCs have been paid in full at the time of final subdivision approval for single-family developments, as well as building permit issuance for a number of uses.

Applicants had the option to proceed under the new bylaw, if agreed in writing that Bylaw No. 190 should have effect.

DCC Review Process



Neilson-Welch Consulting and Leftside Partners were hired to undertake this review. Direction was provided from Council on the process multiple times, the presentations and reports for which can be found below.

Presentations:
A number of rates were proposed for the following categories, for which comprehensive summaries can be reviewed:

What are Development Cost Charges?



The City levies development cost charges (DCCs) on new development to help finance the cost of providing new, or upgrading existing infrastructure, as well as the acquisition of new parkland. DCCs are imposed on subdivision approvals that create single family residential lots. They are also applicable to building permit applications for multi-family residential, commercial, institutional, and industrial development where the value of work exceeds $50,000. Municipalities have the authority to collect DCCs as per Section 932 of the Local Government Act.
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Exemptions to DCCs


Not all development is subject to DCCs. The following are exempt from these charges per Sections 933 and 933.1 of the Local Government Act:

  • Developments that do not impose any capital cost burdens on the municipality
  • Where the building permit authorizes work that is not subject to taxation under s. 220(1)(h) and s. 224(2)(f) of the Community Charter
  • The overall value of the work does not exceed $50,000
  • Units that are smaller than 29m2 in size
  • The work is classified as an 'eligible development' in the municipality's DCC bylaw (i.e. affordable rental housing)
  • Additional work to an existing development that does not impose any additional capital cost burdens on the municipality

Inclusion of Interest Charge


As some infrastructure is needed to be built in advance of growth, the City will need to borrow in order to construct large projects such as a water treatment plant. The
DCC Best Practices Guide provides guidance on what situations the Province’s Inspector of Municipalities is likely to consider interest within the DCC calculation. A large fixed capacity infrastructure project, like a water treatment plant, is one of those situations where including interest is possible. The City has included a portion of the interest required for building the water treatment plant at Rose Valley Reservoir and two related transmission mains in advance of sufficient DCC revenues being available to cover the future growth portion of the project. The interest has been calculated on a 20-year basis, which is the DCC program time frame, and is based on the Municipal Finance Authority’s long-term rate of 3 percent. For more information on the proposed interest charges in the DCC Program see the consultant’s memo dated April 17, 2015 (pages 2 and 3).

Public Consultation


After Council's first reading of the draft DCC bylaw on November 10, 2015, members of the public were invited to comment on the proposed rates
.

Other public consultation occurred as follows:

  • Information meeting on October 21, 2015
  • Presentation to the Advisory Planning Commission October 21, 2015 
  • Presentation to the Agricultural Advisory Commission November 5, 2015