EPC votes for development fee, industry threatens legal action


Facing the threat of a court battle with the home-building industry, Mayor Brian Bowman left city hall Wednesday with a split decision from his inner circle of senior councillors in favour of imposing controversial new fees on residential development.

Bowman and members of his executive policy committee voted 5-2 in favour of the modified impact-fee proposal, which will impose a charge of $9,151.95 on a new 1,800-square-foot home built in the city’s suburban fringe areas effective May 1. The plan goes to council for debate and vote next week.

“I think what you saw is a majority of councillors (on EPC) putting the best interests of all Winnipeggers at heart, not just special interests,” Bowman said following the EPC meeting.

Bowman dismissed the threat of legal action as unfortunate and unnecessary, suggesting there is a wide gulf between city hall and the development industry that no amount of consultation can overcome.

“You heard the (industry) position that they believe growth is paying for growth,” Bowman told reporters. “We have and we will continue to do our best to have a mechanism in place for input, but council will make decisions they feel are in the best interests of all Winnipeggers, not just special-interest groups.”

The plan and accompanying bylaw that go to council’s Oct. 26 meeting imposes a fee on new residential development of $54.73 per square metre ($5,084.42 per 1,000 square feet). While the original administrative report of Sept. 16 recommended fees on all development — residential and non-residential — the latest report exempts new commercial, industrial and office development from a fee in select suburban areas for two years and from all other areas of the city for a three-year period.

The latest proposal surfaced Friday following three weeks of consultations by Coun. John Orlikow, chairman of council’s property and development committee, who had been tasked by Bowman and EPC to meet with local stakeholders following the release of the original administrative report.

Bowman initially called for the fees last February has crafted an unusual coalition of suburban and inner-city councillors who support him.

Among EPC members, only councillors Jeff Browaty (North Kildonan) and Janice Lukes (South Winnipeg-St. Norbert) voted against the proposal at Wednesday’s meeting. Lukes, who maintains Bowman has rushed the process and ignored the concerns of the development industry, later told reporters she could not envision any scenario where she would vote for the fee at next week’s council meeting.

Councillors Russ Wyatt (Transcona) and Scott Gillingham (St. James-Brooklands-Weston) appeared as delegations at the committee in opposition to the plan. Both agreed the process had been rushed and ignored industry concerns.

Jenny Gerbasi (Fort Rouge-East Fort Garry) and Cindy Gilroy (Daniel Mynarski) spoke at the committee in favour of the plan, congratulating Bowman and other members of EPC for bringing it to council.

“It takes courage to bring change to a city,” Gerbasi said. “For too long council has passively allowed our city to become more and more financially and otherwise unsustainable by taking little action on the problem we face with growth not paying for growth… For too long there’s been a sense that city council was under some sort of spell of the development industry.”

Browaty said he doesn”t believe the industry is paying for the costs to deliver “soft” civic services, singling out the cost of transit, recreation facilities, parks and fire-paramedic stations as examples, but he added that the proposed fee — while significantly less than what had been proposed by the consultant and the administration — is still too high.

He said there would have to be some key amendments to the proposal before he could support it on Oct. 26.

The proposal received an unexpected endorsement from the Downtown Business Improvement Zone, which praised Bowman for exempting the downtown areas from new fees.

Opposition Wednesday from the development industry was not unexpected. Industry representatives have maintained the work of the Toronto consulting firm, which provided the foundation for the civic reports, had been flawed – exaggerated and sometimes fabricated – to comply with Bowman’s agenda and that the process had been rushed and their input ignored.

Several industry representatives disputed the city”s claim that growth does not pay for growth — meaning that new residential and non-residential developments aren”t paying for the related infrastructure costs needed to service the new developments.

Mike Moore, president of the Manitoba Home Builders Association, called the proposed bylaw “reckless and unacceptable.” It was Moore who told the meeting that the industry would challenge the new fee in court.

“Industry has been dictated to, not consulted,” Moore said. “The proposed bylaw is illegal… Imposing a fee as currently put forward leaves the industry with no choice but to put forward a legal challenge.”

Former councillor Garth Steek lectured Bowman and EPC members to pay attention to the development industry representatives and criticized them for ignoring cost-benefit analysis studies that contradict the city’s position.

“Mr. Mayor, I voted for you, a lot of people in this city did,” Steek said. “We expected openness, accountability and transparency. You’re rushing this thing to judgment. It’s unconscionable. There are so many questions around this table that you can’t answer, that you should be in consultation with these people.”

Steek warned Bowman and the other councillors that their approach could generate a public backlash against against them in the next civic election.

“This city is full of citizens like me,” Steek said. “We’re watching this as an issue… Have the courage of your convictions — if you believe it’s right, let’s make it an election issue. It will galvanize public opinion like nothing else will. The last time around we got eight new members on this council. We’re watching. We’re diligent.”

Some of the industry criticisms took on a personal note. Michael Falk, vice-president of Terracon, a commercial builder and property manager, said Bowman was treating the industry as if he was involved in a television game show.

“Mayor Bowman wants us to play Let’s Make A Deal,” Falk said, referring to the city hall”s decision to revise the residential fee amount downwards several times. “Monty Bowman, I don’t like your current deal… This is reckless, rickety and risky.”

Eric Vogan, president of the Urban Development Institute, the industry”s lobby group, described the impact-fee proposal as a scheme based on a “flimsy plan,” and said city hall is ignoring several studies that have shown growth is paying more than its fair share.

Vogan, vice-president at Qualico — Winnipeg”s largest home builder — criticized the modified proposal for its focus on new residential development, adding the fee will slow growth in the city.

Alan Borger, president of Ladco, another large home-building firm in the city, said some councillors and city officials are dismissing the cost-benefit studies done at the city”s request as a matter of opinion. “It’s finance, or math, not religion,” Borger said. “Please reconsider, please slow this down. Based on the cost-benefits, our developments are sustainable.”


Read more by Aldo Santin.

How they voted

In support of modified impact fee plan: Mayor Brian Bowman, Couns. Marty Morantz (Charleswood-Tuxedo-Whyte Ridge), John Orlikow (River Heights-Fort Garry), Mike Pagtakhan (Point Douglas), Brian Mayes (St. Vital).

Against: Couns. Jeff Browaty (North Kildonan), Janice Lukes (South Winnipeg-St. Norbert).