Thunder Bay Development Charge Proposal

The City of Thunder Bay is currently in a position where it is struggling to generate enough revenue and provide the services that the residents desire from it. As with many other Canadian cities; Thunder Bay is currently struggling with a significant infrastructure deficit; which compounds the backlog of projects annually. The heavy industrial industrial tax base has been reassessed to much lower levels and significant strain is being placed on the residences to make up the difference. These challenges are made worse by poor urban planning in the past which promoted urban sprawl; the de-urbanization of the core and the belief that the car/cheap gas would power society through the next 100 years. Merriam-Webster calls urban sprawl: “the spreading of urban developments (such as houses and shopping centers) on undeveloped land near a city.” The financial mistake we now call urban sprawl was covered by growing industrial and commercial taxes which allowed for residential taxes to be artificially kept low. As these have tax pillars slowly have been eroded we have seen this burden placed on residential housing to cover the cost. In conjunction with an aging and declining population the City of Thunder Bay faces a significant revenue issue; it simply does not pull in enough money in order to fully fund its costs. Projects, programs and debt are deferred to further years which increases the costs and adds to the backlog of items needing work. One area in which traditionally the residential tax base has seen growth is to allow for single detached homes to be built in the undeveloped areas as a means of bringing in additional money. Areas such as Neebing, McIntrye and Northwood (all 3 in certain instances) are a semi-rural where large numbers of city services are provided with little substance to add to the tax base. Every resident in Thunder Bay can attest to how certain areas have been built for new housing on what was once swamp, forest and bush; all natural remedies for storm protection and animal habitat. This development has been promoted because often the repair costs for the roads, sewage, etc come up at a 20-25 year period. Long after the presiding council is gone and passed onto a younger generation of resident. Unfortunately we see that this though process is actually a drain on city coffers as the farther the development is allowed to go the more costly services like fire, EMS, garbage become.

As seen in this photo there is significant cost associated with building and providing homes on the edge of our communities. The only people who get rich off of homes in the suburbs are the developers who push these developments and promote their ‘positives’. As the City of Thunder Bay looks to find ways to bring in new income I propose a development tax on the construction of new homes and buildings within the community. This development tax would not apply to additions to buildings or repairs/renovations of existing units. The City of Toronto is one example of a community that uses a blanket development tax and uses that income for programs including the Toronto Transit Commission (TTC), Public Libraries, food programs, etc. In 2013, Toronto considered raising their development charges which they expected would bring in an addition $3 billion dollars in 10 years. This would be in addition to the existing income that the city receives from the development tax. These taxes have been used by communities such as Mississauga to artificially keep taxes low or in Toronto’s case help to shift the load off tax payers for these projects. The issue I have with this program is that it provides the same blanket to the downtown cores as it does the suburban areas which does not help to continue the process of infill and density growth. Had Toronto not had areas like the Financial district to draw people to live in downtown Toronto they may have had issues of making a program like this work. In my mind for Thunder Bay I would like to see a development charge based on distance which would help to actually cover the costs of building on the fringe for the city but also make it more challenging for companies to continue the urban sprawl.

Please forgive the poor paint job but this would be a representative idea of what the plan would look like. Based on the two cores the city would be broken into rings where the farther from the core the more it costs you to build. This fee would be a percentage of the cost of the construction and would also result in lower scores for staff members time meaning it would take you longer to get an inspection done and approvals. In order to further promote development in the established areas the city would provide a subsidy in the red areas which would reduce the cost of building in these areas which would lead to urban renewal and density. This plan would be directed to low level residential and commercial spaces but with medium to higher density the rings would be further out. More dense construction or mixed-unit construction would receive top priority from the city and be in line for higher percentages off which would allow for this type of development to be promoted.

The red ring in this instance would lead to a 5% off the cost of building a unit; priority sequence for staff attention and approvals. For a developer working on a unit that costs $100,000 this works out to a rebate of $5,000. These costs would be covered by the fees paid by developers in other areas; as to avoid further challenges to the city’s coffers. If a program like this only bring in a small amount of money or is cost neutral how is it beneficial to the city? In discussions with a developer looking to build a 8 unit home by the Safeway on Dawson road; Councilor Shelby Ch’ng asked the taxation income of this unit compared to a single unit residential on the property. Administration representatives told her that the new home would bring in approx. $16,000 annually compared to the current $2,500 being brought in. If this program can lead to density growth for the city that means large income for the cities coffers. Increased levels of density also helps to benefit other systems and programs as well. Transit ridership increases; use of services like libraries, schools etc increases and these areas become hotbed for development of private industry.

The orange ring would have no development fee associated with the area and would have a regular priority for the city’s departments. Green would have a 5% fee associated with the charge meaning a $100,000 development now brings in the city $5,000 for the unit; it would also have a regular priority for city department needs. The further away would lead to increased cost for any developer with blue being 10%, purple 15% both of these would have a lower priority for city staff and could be jumped by developments closer to the core even if they were submitted later. The areas not surrounded by a ring which would affect mainly the McIntrye Ward and Needing would face a 25% fee and the lowest level of support from the city. These wards continue to cost the city thousands of dollars which are not recouped even with lower levels of services and higher tax rates. The promotion of a semi-rural lifestyle with the amenities of the city but away from the city itself is unsustainable. Even if services like sewers or water aren’t provided we see increased costs in these areas especially from services like emergency services which are required to provide 24/7 coverage. In certain instances it also requires additional infrastructure to protect these areas; once such area is Fire. The Fire department has a fire hall specifically for Neebing because it typically lies outside of its 6 minute target radius. A fire unit alone can cost up to one million dollars and the cost of staffing outweigh almost all income form this area.

Another example: The city is spending $250,000 a year to chip seal dirt roads in McIntyre due to complaints about dust from residents. Council approved in 2015 an addition to a residential development in Neebing. The addition if taxed at $7,000 a year was only expected to bring in $125,000 annually which means that urban areas are now forced to subsidize the rural areas because they are not self-supportive. Another example: The City of Thunder Bay is expected to spend $5 million dollars on phase 3 of the Golf Links expansion much of which is to support growth in suburban areas and flow in and out of the city. This cost is born by the city to help support suburban desires which rotting out the core of the community.

Thunder Bay has this negative idea that density and high rises are means of poverty and lower income. That only the white picket fence can show the true income of the homeowner and those who live there. This connotation is coming from the American dream and the community wanting to relive the glory days. Without significant change in the way the city does business it will build itself so far out that it cannot afford even the basic services. It will take political will but I hope that the people who are running in 2018 see the danger that a city the same size of Montreal with a declining and aging population is facing.

References:

https://www.merriam-webster.com/dictionary/urban%20sprawl

Looking to City of Thunder Bay Budget 2017

2016 has quickly come and gone and it is time for the City of Thunder Bay departments to bring together their wants/needs/deferrals and dust off the projects that got put on the shelf a long time ago. As Thunder Bay departments look to the future I think its necessary that those on City council take a step back from the political posturing (Councillor Verdiramo) and really try to deal with Thunder Bay’s realities. Council last year deferred projects and items that will come back to make this years budget process even harder. The decisions that we make today are going to effect us going forward. We need to make the right decisions in order to truly create the city that people will want to live in and move to. Some of the items below aren’t going to be directly related to budgetary concerns but as the minds of Thunder Bays departments come together it could lead to policies that improve and help to direct the city going forward.

Policies:

  1. Density Targets – The Province of Ontario is setting new and increasingly dense targets for communities in Central and Southern Ontario to address the concerns of urban sprawl, transit and more. While Thunder Bay isn’t a part of this new plan its time that Thunder Bay adopted these guidelines and policies to help create the density it needs. Thunder Bay has a density of 330.1 people per square kilometer which is incredibly low for a community of this size. It means that our services are stretched longer and cost more and that the people that live in the community are less healthy. Adding to our density will work towards helping improve the life of our community and stretch our dollar further.
  2. Humanity and Clean&Green – As Thunder Bay moves forward and plans/builds new facilities I believe that it is time to provide a safe space for everyone. We continue to see groups of marginalized people like those of the LGBQT community face daily challenges. As a small means of solidarity; I would like to see the City of Thunder Bay develop a policy that includes gender neutral bathrooms in the design as a mandatory component for city buildings. Additionally I would like to see the city establish electric power stations at its new facilities to help facilitate the expansion of electric vehicles within the community.
  3. Green Buildings/vehicles – Many of the City of Thunder Bay’s facilities are older and are built for a time before climate change. Its time to look at creating a plan to reduce the footprint the City of Thunder Bay has and creating modern, efficient buildings that cost the city less and produce less harmful effects for the environment. The city of Thunder Bay as an entity created 30,078 tonnes eC02 and used 4.280 million litres of fuel throughout 2015. As we look forward we need to consider the types of vehicles and units we use; if there are legitimate environmentally friendly options for the city to use instead. Every penny that fuel costs rise cost transit $44,000 and with the projected costs only to go up we need to make these decisions now.
  4. Investing in Technology – Technology has become an important part of how we as a society function and operate. There are always new and emerging ways to make the job easier, quicker and reduce the negative effects on individuals bodies. Thunder Bay Police Service is one institution that could easily benefit from additional technology. Many officers are still stuck writing tickets by hand and stuck for extended periods of time writing multiple copies. Cruisers are small but they can be adapted to work for the officers benefit. Printers that double as a head rest are just one example. Instead of taking 45 minutes to write 3 copies of the same paperwork it could be done once on a computer and have the officer onto the next call in significantly less time.
  5. Modern Parking lot Codes – Thunder Bay is obsessed with parking and the opportunity to park as close to the establishment as possible. This is not only unhealthy for the user as it promotes a lazy lifestyle but for the environment as well. The modern parking lot acts as reflective shield bringing large amounts of water to the storm sewers and catch basins. Whereas green space would catch this or a portion of the water the asphalt deflects it. Requiring those who plan to develop parking lots or fix established ones in Thunder Bay to change how they create this space. If a business wanted to create a 200 stall lot under the old standard they would see this happen but if we introduced new rules it could develop more greenspace. Requiring 20-20% of land to be used as green space for shrubs, grass, trees etc would reduce water flow to city sewers and provide green spaces within the community.

Budgetary concerns:

  1. Printing Office – One has wonder if Thunder Bay needs to own and operate its own printing unit. Can things be done by the private sector for less cost? do we need to be printing as much as the city does? While I don’t want to see people lose their positions or their income one has to ask if there is a need for this under the city umbrella
  2. Staffing – Without knowing the direct operations of the City of Thunder Bay its hard for me to truly provide either a criticism or a positive on this topic but for many companies staffing amounts for 90% of their operational costs. This leaves little for other items and can handcuff corporations now and into the future. Conducting a review whether it is necessary to cut or add positions has to be a necessary evil. A review starting from the top and working down is just one step.
  3. Infrastructure upgrades benefiting urban sprawl – in 2018 the city has 750,000 projected for the NW Arterial route for property acquisition. Then additionally a projected cost somewhere in the tune of $20 million for the road itself. This infrastructure project only benefits those who live in the fringe of the community and make it easier for their suburban lifestyle. This project should be scrapped and the money reallocated for other infrastructure projects. Additionally as the expansion of road projects gets further from the cores we should start to consider additional factors like does it support urban sprawl, could transit/multi-use better suit the space etc.
  4. Development fee – Building in Thunder Bay continues to expand on the fringes of our community. A recent decision by council to increase the size of Neebing ward by 120 units means additional cost beyond revenue for the city. Its time to require development in the fringes to pay for their cost. I propose a distance based fee with the 2 downtown cores as the anchors. As the development gets x distance from the core the cost to develop increases. While developing in the core itself could net the developer a rebate on their building costs; building in Neebing or Mcintrye could cost someone 15-20% of their development costs through a fee which could be put towards infrastructure.
  5. EIRP – Simple enough, it needs to continue and potentially expand to work with Confederation College and Lakehead University to address some of their costs. Both institutions bring in youth and huge sums of money into the community. Making them more profitable and their image better only serves to benefit the community today and tomorrow.
  6. Proper Funding – Its hard to come to the community and say its going to be this percentage or this percentage. Its much simpler to let the department heads deffer projects because of variance issues at the end of the day. Its time to forgo this practice and properly fund the departments and stop dealing with the fires of variances as they arrive. Thunder Bay Police Service Chief J.P. Levesque continues to come to council with the budget they require and then council cuts it. At the end of the day we end up in the same place. When I budget I do so for my expenses and then a contingency for those issues that arise and the City of Thunder Bay should too.

 

References:

http://www12.statcan.gc.ca/census-recensement/2011/dp-pd/prof/details/page.cfm?Lang=E&Geo1=CSD&Code1=3558004&Geo2=CSD&Code2=3543042&Data=Count&SearchText=barrie&SearchType=Begins&SearchPR=01&B1=All&Custom=&TABID=1

http://www.thunderbay.ca/Assets/Strategic+Plan+2015/docs/Implementation+Plan.pdf

http://www.thunderbay.ca/Assets/City+Government/Finance+$!26+Budgets/docs/Budget+2016/2016_TAX_CAP_I$!26O.pdf