By Josh Hall (Twitter: @Vancan19)

costs coming down

City looking to make development more attractive through off-site levies

Nov 1, 2019 | 11:08 AM

The City of Red Deer is making life easier for developers by reducing the average rate of off-site levies.

An off-site levy is collected from a developer in order to pay for water, sanitary, storm and road infrastructure.

Currently, the same fee of $237,000 per hectare applies to any development, regardless of where it is in the city. Should city council pass second and third readings on November 25, it will separate the city into 19 areas with different rates.

“Developers only want to contribute to the infrastructure that benefits their area of the city,” says Konrad Dunbar, Manager of Engineering Services. “They don’t want to be paying for infrastructure for other parts of the city. It’s transparent because they’ll know what they’re paying for.”

Red Deer compares favourably to other similarly-sized municipalities, which range from $250,000 to $350,000 for off-site levies, according to a City report.

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Rates for certain areas of the city will drop to as low as $76,000, with 11 overall seeing a decrease. Five will go up to as high as $308,000, and are generally areas further away from the river and the water treatment centre.

“It will benefit consumers in the long run because developers have to pay that off-site levy fee, and that goes directly into the costs of the lot,” Dunbar explains. “When they subdivide in those areas where rates are going down, the cost of the lots will ultimately be less.”

Dunbar also noted that municipalities cannot make a profit from off-site levies, in accordance with the Municipal Government Act.

Denie Olmstead, CEO with BILD Central Alberta, says his organization supports the proposed changes.

The public can provide feedback on the bylaw up until the Nov. 25 meeting of city council.