Why don’t our municipalities have better environmental infrastructure? One answer is: the Development Charges Act (DCA)!
While cycling recently with one Ontario mayor, I asked why his fast-growing municipality did so little to encourage bicycle commuting. He knows that cycling is a great way to reduce emissions and gridlock while improving human and environmental health. Cycle paths are inexpensive if designed into developments, but frustratingly hard to retrofit afterwards. So why don’t all new developments include them?
In growing areas, development charges make up a significant portion of the municipal budget, and pay for much of its new infrastructure. However, among other restrictions, the Development Charges Act prevents municipalities from imposing development charges that:
s.5: would result in the level of service exceeding the average level of that service provided in the municipality over the 10-year period immediately preceding the preparation of the background study...
In addition, development charges cannot fund services that will benefit existing development; for most services, they can cover a maximum of 90 percent of the capital costs.
This makes it expensive for a municipality to upgrade services, and to add new features, such as bike lanes. Any capital costs that cannot be covered by development charges must be paid for out of general tax revenue, a source that usually has nothing to spare. For example, in 2004, when Kingston decided to require bike lanes in new subdivisions, 80% of the cost had to come from the property taxes of existing residents, because the City did not have 10 years of experience of constructing bike lanes.