Who pays? Essex County ponders $13K build charges on top of local fees

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Despite calls from some councillors to kill the process outright, Essex County is moving ahead with public consultations into new development charges that could see an extra $13,000 added to the cost of a home. 

Proponents of the move argue the new fees are needed to help cover the high costs of new infrastructure to accommodate new growth. Essex County’s seven municipalities already levy local development charges on residential development, but the new county levies would come on top of those. 

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Essex County is facing $1-billion in upper-tier infrastructure needs so it has no choice but to impose its own development fees, Tecumseh Mayor Gary McNamara said at the April 2 county council meeting. 

He previously said about $850 million of that is for roads, much of which will be spent over the next 10 to 15 years.

“One billion dollars — so one way or another, it’s either going to be paid through property taxes, or … we can reduce that amount through development charges,” McNamara said. 

feesTecumseh Mayor Gary McNamara, seen during a meeting of Tecumseh town council on Feb. 25, 2025, said Essex County faces a $1-billion infrastructure bill.

Last year, council hired Toronto-based Hemson Consulting to prepare a background document making the case for development fees under Ontario’s Development Charges Act.  

Hemson’s Stefan Krzeczunowicz presented the case to councillors April 2, but two councillors wanted the process stopped in its tracks and another expressed reservations. 

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I had concerns when this was first brought up, and this report has done nothing to alleviate those concerns,” said Kirk Walstedt, deputy mayor of the Municipality of Lakeshore.

“I know the developers and builders would be upset. In the end, it’s all passed on to the homeowners or to the buyers.” 

A new county development charge won’t help in addressing the need for affordable housing, Walstedt said: “We seem to have got along fine without it. 

“I don’t even want to proceed any further with it, so I’ll vote against the motion to even take it to the public at this point in time, because I think it’s just heading in the wrong direction.” 

In Ontario, new construction specifically aimed at affordable housing is exempt from development fees. 

The concept of making sure current residents aren’t the ones paying for new growth is a widely held tenet of municipal planning. Development fees on new construction are a key tool to pay for expanded municipal services required to accommodate that growth. Developers pay them and they’re often passed on to the buyer in the form of higher housing prices. 

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At the county level, the fees pay for such things as highway expansion, ambulance services, library services, waste diversion, and long-term care (which includes residential facilities, public health, child care and early years programs). 

Recommendations unveiled by Hemson consultants at the meeting suggest $12,998 per house, $7,871 for multi-unit housing and $6,917 for other residential units. Non-residential units would face a charge of $46.50 per square metre. 

The fees represent the most the county could collect under the Development Charges Act, with a total estimate of as much as $320 million over the course of the levy. 

Lakeshore Mayor Tracey Bailey said the fees will have a “negative impact to our region.” 

feesLakeshore Mayor Tracey Bailey, shown Nov. 22, 2022, is also among the opponents of proposed county development fees on residential construction.

“If I had my way, I would stop the process here,” she said.  

Councillors were not being asked to approve the fees April 2, merely to receive the report showing how they would work.  

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Calling affordable housing the “challenge of our time,” Bailey said: “This is a cash grab to be able to pull (money) from the upper and the lower (municipalities) at the same time. Regardless, it translates back to our residents.” 

LaSalle Mayor Crystal Meloche also had reservations.  

“I agree with the comment that growth should pay for growth,” she said. “However, I am concerned with the numbers being presented as we are in a housing crisis, and we’re already seeing builders slow down with what’s been going on the past 18 months. 

“I’m afraid that this is going to have a negative impact on the region.” 

feesLaSalle Mayor Crystal Meloche, pictured at the town’s council chambers on Oct. 29, 2024, has reservations about proposed development charges in Essex County.

A majority of councillors nevertheless voted to receive the report and to begin holding public consultation sessions in all seven Essex County municipalities. 

Hemson’s Krzeczunowicz said his report looked at projected population and housing growth in the county, which is expected to increase by 32,000 people in the next 10 years and by just under 50,000 by 2041 after increasing by more than 30,000 since 2011, with 11,000 new homes. 

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To meet the extra demand for services, the Windsor-Essex EMS, for example, is looking at a new headquarters and two new substations, as well as hiring paramedics and buying equipment to maintain service levels.

The maximum funds available through development charges for land ambulance service would be about $6.9 million. Services for long-term care, including a $4-million upgrade of Sun Parlor Long Term Care Home in Leamington, could recover $18.5 million through development fees.  

Waste diversion could recover $2.4 million, library services about $2.5 million. 

But the biggest expense facing the county by far are road upgrades and construction, with or without land costs, that could be funded by $291 million in development fees. That would include buying land, enhancing road capacity in various forms, intersection improvements and active transportation initiatives. 

Comparisons to other upper-tier municipalities show Essex County’s proposed fees would be near the higher end, but council heard some of those fees looked at were set several years ago and can be expected to rise.

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Wellington County charges about $11,500 in development fees, the Hemson report said. Oxford County charges $6,520, Middlesex County $5,665 and the Region of Waterloo charges $25,000. 

Chatham-Kent was not included in the study since it’s a single-tier municipality but councillors in their motion asked Henson to add it to a follow-up report. 

If the proposed development fees are approved, combined with local development charges and area-specific development fees, residential charges in the county’s municipalities would be: 

  • LaSalle: $69,237 
  • Amherstburg: $47,742 
  • Lakeshore: $47,579 
  • Tecumseh urban area: $46,914 
  • Kingsville: $32,457  
  • Essex: $48,112 in the McGregor service area; $38,176 in Harrow 
  • Leamington: $25,103. 

For comparison, Sarnia’s total development fees in 2023 were $44,942, according to the Hemson report. 

Kingsville Deputy Mayor Kimberley DeYong asked if the fees could hinder growth. Krzeczunowicz said that isn’t considered when preparing fees, but he noted the county fees would be about two per cent of the current $560,000 average price of a house in Windsor and Essex County. 

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Essex Mayor Sherry Bondy, who also said she thinks new growth should pay its way, inquired about rolling out fees at a lower level, then increasing them each year to get to the upper limit after a few years. 

feesEssex Mayor Sherry Bondy, pictured during Essex County Council regular meeting on Wednesday, April 2, wonders if development fees in Essex County can be phased in gradually.

Krzeczunowicz said the deficit in needed funds to pay for services during that time would not be permitted to be collected from higher development fees later and would likely be covered by existing taxpayers.

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A complicating factor may be Liberal Leader Mark Carney’s plan to cut municipal development charges in half for multi-unit residential housing if he is elected prime minister. The government would then work with provinces and territories to make up the lost revenue for municipalities for a period of five years.

bamacleod@postmedia.com 

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