The City of Victoria鈥檚 community-amenities contribution formula might seem like a cash grab at first glance, but it鈥檚 a fair and reasonable process. The city should not depart from it.
Development approvals pose tough challenges for municipal councillors. Large projects almost always involve horse-trading. Developers seek rezoning for greater height or density; in return, they offer to do such things as preserve green space, commission public art or add other amenities that benefit the neighbourhood. All the while, concerned neighbours watch the process critically.
In the past, councillors in Victoria and throughout the region suffered from a disadvantage. They had little hard information about the value of the amenities being offered by developers and even less about the worth of the required zoning changes to the companies. They could not work toward the best deal for the public.
Councils risked trading benefits worth millions to a developer for a few amenities of dubious value 鈥� or, less frequently, of blocking a worthwhile addition to the community with unreasonable demands.
About a decade ago, the city came up with a formula that calls for an amenity contribution equivalent to 75 per cent of the additional value of the land, as determined by an independent consultant.
For the developer wanting to build two 12-storey residential towers across Douglas Street from the Mayfair Shopping Centre, rezoning to a higher density increased the value of the land by $1.3 million, so the city is asking for an amenity contribution of $975,000.
The developer is not opposed to the amenity contribution, but disagrees on the amount. Mark Johnston, consultant to property owner Brian Martin, says $975,000 is unreasonable. He says a contribution of $200,000, to go toward amenities in the Burnside/Gorge neighbourhood, would be more appropriate.
Johnston said the landowner is already being required to install a sewage attenuation tank, at a cost of about $200,000, to regulate flows into city sewers. That, he says, should be deducted from the amenity contribution.
He says geotechnical reports indicate the owner will have to install special footings, at a cost of $3.5 million, because of soil conditions. The owner is also required to provide a mid-block pedestrian access and has agreed to a covenant to ensure there are no restrictions on rentals.
Johnston says the new towers will also bring in tax revenues of about $300,000 a year.
While defending the public interest, the city must also give consideration to the developer鈥檚 points.
Local governments 鈥渕ust ensure that any CACs are obtained as part of the negotiation process,鈥� says a guide found on the website of the Ministry of Community, Sport and Cultural Development. 鈥淟ocal governments must also not commit to passing a rezoning bylaw on the condition that CACs are provided. Council and regional board members are legally required to remain open-minded on a proposed rezoning, until they have heard the public鈥檚 perspective at the public hearing.鈥�
But the ministry website also cautions against misusing CACs. 鈥淚t is important to keep in mind that zoning is intended to implement the community plan and should not be seen as a revenue source,鈥� it says.
Jonathan Tinney, director of sustainable planning and community development, said the city is waiting for more information from the developer before the final figure is set.
鈥淚t鈥檚 up to council to determine the whole package,鈥� he said.
It鈥檚 a good process. New developments trigger costs for infrastructure, and higher densities put more demand on amenities. Sharing the economic benefit of increased land value is a fair way of protecting the public interest.
