Despite hike, DCCs on low side

By MARKUS ERMISCHStaff reporterJan 05 2007 http://www.kamloopsthisweek.com/
Development cost charges (DCCs) are expected to increase by 40 per cent once the city finishes its review next month. Compared to similar-sized cities, however, DCCs are significantly lower in Kamloops, even after the new charges come into effect once council votes on the issue in March. David Trawin, the city’s director of development and engineering services, said final DCC levels remain to be calculated, pending additional discussions with the Kamloops chapter of the Canadian Home Builders’ Association (CHBA), but noted the charge to extend city infrastructure to new developments “could increase by up to 40 per cent, potentially.” This would mean that DCCs for a single-family home would rise to $9,461 from $6,758, an increase of $2,703.

Homebuilders usually pass on DCCs to homebuyers. Patsy Bourassa, executive officer of the CHBA in Kamloops, said “philosophically, we’re against DCCs as inhibitors to growth.” The last time the city raised the level of DCCs in 2004, Kamloops homebuilders opposed the move, and they are likely to do so again this time. “From a builders’ perspective, it just has to be very clear to the consumer that DCCs are a tax,” Bourassa said, noting the CHBA prefers cities use federal transfer payments to help pay for infrastructure extensions. She did, however, commend the city’s development department for “a collaborative relationship” during the DCC review. In B.C., DCCs vary from jurisdiction to jurisdiction.

Fort St. John, for example, doesn’t charge DCCs at all. But the Peace city is unique among B.C. communities because it receives gas royalties from the government, which in turn can be used to fund infrastructure extensions, such as roads and sewers. Compared to cities that charge DCCs, homebuilders in Kamloops pay significantly less than many of their counterparts elsewhere in the province. This week, the Chilliwack hiked DCCs by 27 per cent. The new DCC for a single-family home is $19,935. In Nanaimo, a city which only now is emerging from economic stagnation, DCCs for single-family homes have remained at $13,410 for six years. Toby Seward, Nanaimo’s director of permits and properties, said that when the city introduced the new level of DCCs in 2001, homebuilders initially opposed the higher charges. With time, however, resistance faded, Seward said, because the economy started to improve.