Battle over impact fees heads to court in January

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This article was published 05/12/2016 (2979 days ago), so information in it may no longer be current.

City hall can expect a courtroom fight next month over the controversial fees that will be imposed on new housing developments beginning in the spring.

Mike Moore, president of the Manitoba Home Builders Association, said the industry’s legal team will file a challenge in Queen’s Bench within the first two weeks of January.

Moore said that while the case is more complex than originally anticipated, the association’s legal team is expecting a victory.

The homebuilders group is launching the challenge in a bid to stop the city from implementing the “impact fee” on new homes built in select suburban areas. The fee — about $5,100 per 1,000 square feet — goes into effect May 1.

The city says the new fee is needed to generate revenue to offset the cost of constructing new infrastructure — regional roads, transit, recreation and leisure facilities — to meet the needs stemming from the creation of new subdivisions.

The industry, however, claims the city doesn’t have the authority to impose such fees under the City of Winnipeg Charter.

Council has directed that revenue from the new fee go directly into a reserve account, rather than the city’s general revenue fund. The city has estimated the new fee will generate $1 million from the May-December 2017 period – an amount of revenue that Moore said represents only 111 new housing starts, which he said would be a drastic reduction from previous years.

City planning director John Kiernan said the decline in the number of housing permits issued after May 1 is expected to be offset by a larger-than-normal increase in the January-May period.

However, Moore said that while there will be some increase in housing permit applications before May 1, it’s not possible to make up the difference because homebuilders don’t have enough crews to put up the same number of new homes.

aldo.santin@freepress.mb.ca