City Council approved a new Development Charges By-law, under the Development Charges Act, in July of 2004. This By-law includes a number of exemptions to help support the City’s growth management goals. For example, development charges do not apply to residential development within the Central Area of the city. Development charges are reduced for apartments within 500 metres of transit and light rail stations if parking restrictions of one parking space per unit are met. The Development Charges By-law also permits, on a case-by-case basis, where authorized by Council resolution, an exemption of development charges for development on contaminated lands (brownfield) -Section 7(t) of By-law 298-2004.
Experience in other municipalities indicates that the monetary value of such a waiver can be a very significant incentive to encourage the revitalization of former industrial and commercial lands. Developers prefer the upfront development charge waiver to help offset remediation costs over the tax increment based pay as you go grant which is paid out over a number of years after the development is complete.
The ability to reduce development charges on contaminated sites will support the City’s Brownfields Redevelopment Strategy and Community Improvement Plan (CIP) and will help to achieve the City’s growth management objectives.
The purpose, type, duration, eligibility criteria and application requirements for this program is described below.
The exemption of development charges due to site contamination is an existing program of Council. The ability to offer this incentive does not require provincial approval under Section 28 of the Planning Act. A summary of the guidelines below have been included in the CIP for information purposes only and do not form part of the CIP. The Development Charge Exemption program is intended to augment and support the programs contained in the CIP.
The key terms listed below and used in this program are defined as per
Section 1.4 (Glossary of Terms) in the Brownfields Redevelopment CIP.
“Applicant” Unless otherwise specified,
is a registered owner, assessed owner or tenant of lands and buildings within
the community improvement project area, and any person to whom a registered
owner, assessed owner or tenant of lands and buildings within the community
improvement project area has assigned the right to receive a reduction in
development charges.
Public
sector owners of property within the community improvement project area are not
eligible to directly apply for this program. The City will determine the
eligibility of applicants.
“Brownfield”: An abandoned, vacant, derelict, idled or
underutilized commercial or industrial property where past actions have
resulted in actual or perceived environmental contamination and/or
derelict or deteriorated buildings.
“City”: The City of Ottawa.
“Community
Improvement”: Unless otherwise specified, this term is as
defined and used in accordance with its meaning under Section 28 of the Planning Act, and means the planning or
replanning, design or redesign, resubdivision, clearance, development,
redevelopment, reconstruction and rehabilitation, or any of them, of a community
improvement project area, and the provision of such residential, commercial,
industrial, public, recreational, institutional, religious, charitable or other
uses, buildings, works, improvements or facilities, or spaces therefore, as may
be appropriate or necessary.
“Community
Improvement
Plan”: Unless otherwise specified, this
term is as defined and used in accordance with its meaning under Section 28 of
the Planning Act and means a plan
approved by the Minister of Municipal Affairs and Housing for the community
improvement of a community improvement project area.
“Community
Improvement
Project
Area”: Unless otherwise specified, this
term is as defined and used in accordance with its meaning under Section 28 of
the Planning Act and means a municipality
or an area within a municipality, the community improvement of which in the
opinion of the council is desirable because of age, dilapidation, overcrowding,
faulty arrangement, unsuitability of buildings or for any other environmental,
social or community economic development reasons.
“Eligible property”: Unless
otherwise specified, is a property (including land and buildings) that is
included in the community improvement project area as defined by by-law.
“Qualified person”: As defined by Section 168.1 of the Environmental Protection Act and Ontario
Regulation 153/04.
“Rehabilitation”: Unless otherwise specified, this term is used
in accordance with its meaning under Section 28 of the Planning Act.
The
purpose of the Development Charge Reduction Program is to encourage the
remediation, rehabilitation and adaptive re-use of brownfield sites by
providing a reduction in development charges that would normally be paid at the
time that a building permit is
issued. This reduction would help to
pay for additional site-related rehabilitation costs normally associated with
brownfield sites.
Description
The
Development Charge Reduction Program will be fully integrated with the
Rehabilitation Grant Program. Therefore, once the Brownfields Redevelopment CIP
is approved by the Minister of Municipal Affairs and Housing, an application
for a reduction in development charges due to site contamination (brownfields)
will require that an application for a Rehabilitation Grant be made. All of the
General Program requirements and Rehabilitation Grant Program specific
requirements listed in the CIP must be met. Therefore, applicants with an
approved application and agreement for a property under the Rehabilitation
Grant Program would have the option of reducing their development charges
payable at the time of building permit issuance by up to the full amount of
their eligible environmental remediation/risk management and LEED program
component costs[1] which are as
described in Section 6.6.3, items f) i –vii of the CIP.
In
order to achieve the City’s Growth Management goals, the reduction in the
development charges due to site contamination is greater for eligible
properties that are located in the Central Area, Mixed Use Centres, and
Mainstreets and within 600 metres of existing or planned rapid transit
stations, as designated in the City’s Official Plan, as amended from time to
time. The maximum amount of reduction of development charges is up to (100%) of
the eligible environmental remediation/risk management and LEED program component costs in the
priority areas for infill and intensification as noted above, and up to a 50%
reduction in eligible costs outside of these priority areas, but within the
Community Improvement Project Area.
After January 16, 2007 and
prior to approval of the Brownfields Redevelopment CIP, a direct application
can be made for the Development Charge Reduction Program (brownfields) pursuant
to this Guideline and all of the General Program requirements and
Rehabilitation Grant Program specific requirements listed in the CIP must be
met.
Applications received prior to
January 16, 2007 must be “eligible property” and meet all of the General
Program requirements and the Specific Program Requirement items listed in this
Guideline. Such applications may only
recover “eligible costs”.
Review and evaluation of an
application for Development Charge Reduction Program (brownfields) and
supporting materials against program eligibility requirements will be done by
City staff who will then prepare a recommendation report to City Council. The
application is subject to approval by resolution of City Council. Any reduction
in the development charge would be applied at the time that the building permit
is issued.
An “eligible property” for the Development Charge Reduction
Program is a property within the community improvement project area where a
Phase II Environmental Site Assessment (ESA) has been conducted, and that as of
the date the Phase II ESA was completed, did not meet the required standards
under subparagraph 4i of Section 168.4(1) of the Environmental Protection Act to permit a Record of Site Condition
(RSC) to be filed in the Environmental Site Registry.
“Eligible costs” for the Development Charge Reduction
Program are the costs of any action taken to reduce the concentration of
contaminants on, in or under the property to permit a record of site condition
(RSC) to be filed in the Environmental Site Registry under Section 168.4 of the
Environmental Protection Act. This includes the costs not covered by any
other financial incentive program as described in the CIP:
a)
Phase II ESAs,
Remedial Work Plans, and Risk Assessments;
b)
environmental
remediation, including the costs of preparing a RSC;
c)
placing clean fill and
grading;
d)
installing environmental
and/or engineering controls/works as specified in the Remedial Work Plan and/or
Risk Assessment;
e)
monitoring,
maintaining and operating environmental and engineering controls/works, as
specified in the Remedial Work Plan and/or Risk Assessment;
f)
environmental
insurance premiums.
g)
the following
Leadership in Energy and Environmental Design (LEED) Program Components:
i)
base plan
review by a certified LEED consultant;
ii)
preparing new
working drawings to the LEED standard;
iii)
submitting and
administering the constructed element testing and certification used to
determine the LEED designation.
The
above-noted eligible costs approved under the Rehabilitation Grant Program
would be applied as a credit against the estimated /actual
development charge payable up to the maximum allowed depending on the
location of the application in the context of the City’s Official Plan / growth
management strategy priority areas. In no case will the total amount of the
reduction provided under this program exceed the total of these eligible costs.
a) The City reserves the
right to audit the cost of any environmental studies, LEED certification
program costs, environmental remediation works, and/or rehabilitation works, at
the expense of the applicant;
b) The City is not
responsible for any costs incurred by an applicant in relation to this program,
including without limitation, costs incurred in anticipation of a reduction in
development charges and/or grant;
c) If the applicant is in
default of any of the general or program specific requirements, or any other
requirements of the City, the City may delay, reduce or cancel the approved
development charge reduction and/or grant;
d) Outstanding work orders,
and/or orders or requests to comply, and/or other charges from the City
(including tax arrears) must be satisfactorily addressed prior to the reduction
of development charges or grant assistance payment;
e) City staff, officials,
and/or agents of the City may inspect any property that is the subject of an
application for this financial incentive program offered by the City.
f)
The total of all grants, loans, exemptions
and tax assistance provided in respect of the particular lands and buildings of
an applicant under the programs contained in the CIP including the development
charges reduction program shall not exceed the cost of rehabilitating said
lands and buildings.
Specific Program Requirements
Applicants are eligible to apply for a reduction in
development charges under this program, subject to meeting the general program
requirements, the following program requirements, and subject to the approval
by City Council:
a)
An application must be
submitted to the City prior to the start of any rehabilitation works to which
the reduction in development charges will apply;
b)
Such application shall
include reports, plans, estimates, contracts and other details as may be
required to satisfy the City with respect to the eligible costs and conformity
of the project with the Official Plan and the CIP;
c)
If the application includes
costs for environmental remediation, the application must be accompanied by a
Phase II ESA, Remedial Work Plan or Risk Assessment Plan prepared by a
qualified person that contains:
i)
an estimate of the
cost of actions that will be required to reduce the concentration of
contaminants on, in or under the property to permit a record of site condition
(RSC) to be filed in the Environmental Site Registry under Section 168.4 of the
Environmental Protection Act; and
ii)
a work plan and budget
for said environmental remediation, and/or risk management actions;
d)
The property shall be
rehabilitated such that the amount of work undertaken is sufficient to at a
minimum result in an increase in the assessed value of the property;
e)
The total value of the
reduction in development charges provided under this program shall not exceed
total eligible costs. This includes the costs not covered by any other
financial incentive program as described in the CIP:
i)
Phase II ESAs,
Remedial Work Plans, and Risk Assessments;
ii)
environmental
remediation, including the costs of preparing a RSC;
iii)
placing clean
fill and grading;
iv)
installing
environmental and/or engineering controls/works, as specified in the Remedial
Work Plan and/or Risk Assessment;
v)
monitoring,
maintaining and operating environmental and engineering controls/works, as
specified in the Remedial Work Plan and/or Risk Assessment;
vi)
environmental
insurance;
vii)
the following
Leadership in Energy and Environmental Design (LEED) Program Components:
·
base plan
review by a certified LEED consultant;
·
preparing new
working drawings to the LEED standard;
·
submitting and
administering the constructed element testing and certification used to
determine the LEED designation.
f) The owner shall file in the Environmental Site Registry a
RSC for the property signed by a qualified person, and the owner shall submit
to the City proof that the RSC has been acknowledged by the Ministry of
Environment (MOE). The RSC will be required as a condition of planning approval
in compliance with the policies set out under Section 4.8.4, Contaminated
Sites, of the Official Plan, as amended by Official Plan amendment 40 (April,
2006).
Council will be reviewing the Development Charges By-law in 2009 as required by the Development Charges Act. This exemption currently in the Development Charges By-law would be reviewed at that time to determine whether it is still an appropriate financial incentive to encourage brownfields redevelopment. Reporting on all financial incentive programs associated with the Brownfields Redevelopment Strategy would occur annually.
[1] The inclusion of the latter costs is aimed at encouraging the incorporation of Smart Growth design principles into new/retrofit building construction. LEED-Leadership in Energy and Environmental Design