Ontario kills most development cost charges

December 9, 2022



The Ontario government passed Bill 23, the More Homes Built Faster Act, to eliminate or reduce development cost charges on home builders in the province.
In addition to setting housing goals for 29 large cities in Ontario, the province also proposes other legislative changes, including allowing up to three living units on a single residential lot without bylaw amendments or municipal permissions.
These units, as well as affordable housing, non-profit housing and “inclusionary zoning” units, will be exempt from additional fees such as development charges, parkland dedication levies and community benefit charges.
The changes are meant to encourage faster delivery of more rental and affordable housing. The province claims there is a 1.5-million-unit shortage of new homes across Ontario.
Development charges, which are collected by cities to help pay for municipal services or impacted infrastructure such as roads and transit, will also be reduced up to 25 per cent for family-sized rental units.
There has been pushback from municipalities, which claim the loss of development cost charges will gut municipal finances and may even slow new home building in Ontario.
Toronto Mayor John Tory has said the move could be devastating for Toronto’s finances.