A new study reveals the CRD’s proposed DCCs for a water supply project undermine new housing in Greater Victoria. A letter and the study commissioned by the Urban Development Institute, Victoria Residential Builders Association and West Shore Developers Association has been sent to the CRD board.
VRBA, UDI & WSDA commissioned Mulholland Parker Land Economists (MPLE) to complete an independent financial impact review of the CRD’s proposed DCCs on new housing. The report concludes that four out of five housing forms in the region “are not viable under current market conditions.” The report states a “prolonged period of depressed housing starts” is anticipated. The proposed “water DCC would reduce project viability beyond these baseline market conditions and delay the timeline for market recovery” by up to 25% (e.g., wood-frame strata from 4 to 5 years, concrete rental from 5 to 6 years). This is clear evidence the proposed DCCs will deter development.
The Local Government Act says (564) (4):
“In setting development cost charges, a local government must take the following into consideration:
(f) whether the charges will, in the municipality or regional district,
(i) deter development,
(ii) discourage the construction of reasonably priced housing or the provision of reasonably priced serviced land”3
By not undertaking an economic study, the CRD fails to meet this obligation. UDI, VRBA and WSDA have done the necessary work demonstrating the CRD’s proposed DCCs would further undermine housing supply in challenging market conditions.
As a result, we are requesting BC’s Inspector of Municipalities reject the CRD bylaw. The DCC Best Practices Guide states, “…the Inspector of Municipalities (Ministry of Municipal Affairs) may refuse approval of a DCC bylaw… if the DCCs are excessive, deter development, or discourage construction of reasonably priced housing.”