BACKGROUND DOCUMENT PERTAINING TO A REVIEW OF THE … · 2014-07-07 · & CDSB Policy Review Report...

BACKGROUND DOCUMENT PERTAINING TO A REVIEW OF

THE EDUCATION DEVELOPMENT CHARGES

POLICIES OF

HALTON DISTRICT SCHOOL BOARD

HALTON CATHOLIC DISTRICT

SCHOOL BOARD

(IN CONSIDERATION OF A NEW EDC BY-LAW TO BE ADOPTED BY THE HDSB ON OR

BEFORE MAY 20, 2009)

(IN CONSIDERATION OF A NEW EDC BY-LAW

TO BE ADOPTED BY THE HCDSB ON OR BEFORE JUNE 2, 2009)

April 9, 2009

Watson & Associates Economists Ltd. S:\HDSB-HCDSB 2009 EDC BY-LAW RENEWAL\reports\Halton DSB & CDSB Policy Review Report April 2009.docx

CONTENTS Page

1. INTRODUCTION 1-1 1.1 Statutory Requirements to Conduct a Review 1-1 1.2 Overview of the Education Funding Model 1-2 1.3 Education Development Charge Objectives 1-3 1.4 The Policy Review Process 1-4 1.5 EDC By-law Renewal Process 1-8

2. OVERVIEW OF EXISTING CHARGES 2-1 2.1 Growth Forecast Assumptions 2-1 2.2 EDC Pupil Yields 2-1 2.3 Ministry-rated Capacity for EDC Purposes 2-3 2.4 Determination of Net Growth-Related Pupil Place Requirement and Associated Site Requirements 2-5 2.5 Site Requirements and Valuation 2-7 2.6 Education Development Charge Calculation 2-8 2.7 Non-residential Contribution 2-9 2.8 Education Development Charges Calculation 2-9

3. OVERVIEW OF EXISTING EDC POLICIES 3-1 3.1 Percentage of Growth-Related Net Education Land Costs to be Borne Through EDCs 3-1 3.2 Jurisdiction-wide vs. Area Municipal (or Sub-area) Charges 3-2 3.3 Non-Statutory Residential Exemptions 3-3 3.4 Non-Statutory Non-Residential Exemptions 3-5 3.5 Demolition and Conversion Credits 3-7 3.6 Percentage of Net Education Land Costs to be Borne by Residential and Non-Residential Development 3-8 3.7 By-law Term 3-9 3.8 Application of Operating Surpluses to Capital Needs 3-10 3.9 Policy on Alternative Accommodation Arrangements 3-10 3.10 Collection of Education Development Charges 3-12

4. EDC BY-LAW STRUCTURE 4-1 4.1 EDC By-law Structure 4-1

5. SUMMARY OF BY-LAW PROVISIONS, APPEALS, AMENDMENTS AND COMPLAINTS 5.1 Summary of By-law Provisions 5-1 5.2 Inter Board Comparison of EDC Rates 5-3 5.3 Appeals, Amendments and Complaints 5-4

6. TRANSITIONAL EDUCATION DEVELOPMENT CHARGE RESERVE FUND REPORTING 6.1 Establishment of an Education Development Charge Reserve Fund 6-1 6.2 Reserve Fund Reporting Requirements 6-2 6.3 Status of the HDSB and HCDSB EDC Reserve Fund 6-3


CONTENTS (Cont’d)

Page APPENDICES A HALTON DISTRICT SCHOOL BOARD – EDC BY-LAW, ADOPTED JUNE 9, 2004 B HALTON CATHOLIC DISTRICT SCHOOL BOARD – EDC BY LAW, ADOPTED JUNE

9, 2004 C EXISTING BOARD POLICIES - APPLICATION OF OPERATING SURPLUSES - ALTERNATIVE ACCOMMODATION ARRANGEMENTS


1. INTRODUCTION

1-1


1. INTRODUCTION

The policy review document outlined herein is intended to provide the reader with an overview

of the education development charge policies underlying the existing EDC by-laws of the Halton

District School Board (HDSB) (EDC By-law 2004) as well as the Halton Catholic District School

Board (HCDSB) (EDC By-law 2004). Both by-laws are applicable throughout the Region of

Halton.

Both the HDSB and the HCDSB adopted and implemented an EDC by-law governing each

Board’s jurisdiction on June 9, 2004, with implementation on June 14, 2004. In accordance with

the legislation, a by-law may be in effect for no more than 5 years. The HDSB expects to give

consideration to the adoption of a new EDC by-law on or before May 20, 2009. The HCDSB

expects to entertain successor by-law adoption on June 2, 2009.

A policy review is intended to address the statutory and non-statutory policy considerations

underlying the existing EDC by-laws and considered by the Board of Trustees at by-law

adoption. Further, the policy review is designed to document any input received since by-law

inception and how each Board has addressed this input through by-law amendment, if any.

1.1 Statutory Requirements to Conduct a Review

Section 257.60 sub-section (1) of the Education Act states that:

“Before passing an education development charge by-law, the board shall conduct a review of the education development charge policies of the board.”

Sub-section (2) goes on to state that:

“In conducting a review under subsection (1), the board shall ensure that adequate information is made available to the public, and for this purpose shall hold at least one public meeting, notice of which shall be given in at least one newspaper having general circulation in the area of jurisdiction of the board.”

Sub-section (3) states that:

“A board is not required to conduct a review under this section before passing the first education development charge by-law it passes after December 31, 1997.”

1-2


As each Halton Region Board has an existing EDC by-law in place, this section of the

legislation, therefore, has the effect of requiring a minimum of two public meetings to be held as

part of the HDSB and the HCDSB consideration of the adoption of a successor education

development charge by-laws.

The purpose of the first public meeting is to ensure that adequate information is made available

to the public and Trustees relative to each of the Boards’ review of their education development

charge policies1. Trustees will make decisions in respect of each policy, having given

consideration to all public input on these matters, as part of the by-law passage process.

The holding of the second public meeting requires that the proposed by-laws and the new

education development charge background studies are made available to the public at least two

weeks prior to the meeting, and to ensure that any person who attends the meeting “... may

make representations relating to the by-law” (s.257.63(2)).

The schedule of public information sessions and public meetings is as follows:

Halton District School Board

Wednesday, April 22, 2009 – 7:00 pm. EDC Policy Review Public Meeting, followed by

the EDC Successor By-law Public Meeting on the same evening.

Wednesday, May 20, 2009 – 7:00 pm. Consideration of By-law Passage

Halton Catholic District School Board

Tuesday, May 5, 2009 – 8:00 pm. EDC Policy Review Public Meeting, followed by the

EDC Successor By-law Public Meeting on the same evening.

Tuesday, June 2, 2009 – 8:00 pm. Consideration of By-law Passage

1The Dictionary of Canadian Law defines “policy” as, “A government commitment to the public to follow an action or course of action in pursuit of approved objectives.”

1-3


1.2 Overview of the Education Funding Model

The primary purpose in implementing education development charges (EDCs) is to provide a

source of funding for growth-related education land costs under the Province’s capital funding

model.

Provincial capital grants are not intended, under the Education Act, to be used for the purchase

of school sites required as a result of enrolment growth within a Board’s jurisdiction. Instead,

boards are responsible for acquiring sites needed for new schools:

from within their existing land holdings

using the proceeds from the sale of surplus property

as part of long-term lease arrangements with the private sector for new schools

through special arrangements with the private sector and/or municipalities (e.g., for

multi-use facilities)

using savings from the Board’s operating budget

Education Development Charges

Education development charges are the primary source of funding site acquisition needs for a

school board experiencing growth within its jurisdiction. Education development charges as a

means of financing site acquisition costs are only available to boards who qualify under the

legislation.

Section 257.54 of the Act allows a board to “pass by-laws for the imposition of education

development charges” if there is residential land in the jurisdiction of a board that would

increase education land costs. Further, Section 257.70 of the Education Act, enables a board to

“pass a by-law amending an education development charge by-law.”

The legislation governing education development charges is found in Division E of the

Education Act; Ontario Regulation 20/98 (as amended) and the EDC Guidelines 2002/03. A

copy of the Guidelines1 can be found at the Ministry of Education website www.edu.gov.on.ca.

1 Education Development Charge Guidelines, Spring 2002, Ministry of Education

1-4


1.3 Education Development Charge Objectives

Education development charges are imposed by both the HDSB and the HCDSB against

residential and non-residential development, in order to recover growth-related net education

land costs, as determined in compliance with the Education Act and its associated Regulations.

Education land costs are defined under the legislation as costs incurred or proposed to be

incurred by a board to:

1. acquire land or an interest in land, including a leasehold interest, to be used by

the board to provide pupil accommodation;

2. provide services to the land or otherwise prepare the site so that a building or

buildings may be built on the land to provide pupil accommodation;

3. prepare and distribute education development charge background studies as

required;

4. fund interest on money borrowed to pay for the costs described in items #1 and

#2;

5. undertake studies in connection with an acquisition referred to in item #1

(s.257.53(2)).

Only the capital component of costs to lease land or to acquire a leasehold interest is an

education land cost.

Under the same section of the Act, the following are not education land costs:

1. Costs of any building other than those used to provide pupil accommodation.

2. Costs that are attributable to excess land1 on a particular site that are not

education land costs.

1 “excess land” means the part of a school site that exceeds the maximum area determined, under s.2(5) of O.Reg. 20/98, based on the number of pupils that can be accommodated in the school to be built on the site.

1-5


1.4 The Policy Review Process

This document, which contains information on the HDSB and the HCDSB education

development charge policies, has been prepared in order to ensure that adequate information is

made available to the public, and to assist in the Boards’ review of their education development

charge policies. This information is being made available, on April 9, 2009 (on request), to

interested members of the public in advance of the April 22, 2009 (HDSB) and May 5, 2009

(HCDSB), Policy Review public meetings.

The Policy Review public meetings are being held in order to inform the public as to the HDSB’s

and the HCDSB’s current education development charge policies, to obtain input relative to

preparing new policies, and to review the proposed process for the adoption of new EDC by-

laws.

The purpose of the Policy Review public meeting, therefore, is not to review quantitative

assumptions respecting the future enrolment projections, and the number of school sites

relating to the proposed education development charge rates, which are currently being

reviewed by the Ministry of Education. The process to recommend education development

charge rates for the next by-law period will be put before the Trustees of each of the Boards and

the public for discussion during the successor by-law public meeting scheduled to be held

immediately following each Board’s Policy Review Public Meeting.

A copy of the advertisement announcing the EDC Policy Review Public Meeting for each of the

Halton Boards is set out on the following pages.

1-6


1-7


1-8


1.5 EDC By-law Renewal Process

The requirement to conduct a review of the existing education development charge policies of

the Halton Boards, in conjunction with conducting a full public consultation process (including

the holding of a minimum of two public meetings), will involve a number of steps. These steps

begin with conducting a review of existing EDC policies, the preparation of an EDC submission

for the proposed education development charges (one for the HDSB and one for the HCDSB),

followed by an extensive public consultation process with the various stakeholders, and

culminating in consideration of the passage of new EDC by-laws by each Board.

Since October 2008, the co-terminous Halton Boards and their consultants have worked

together in the preparation of the background analysis respecting growth projections, pupil

enrolment forecasts, determination of growth-related pupil place needs and associated site

requirements, site acquisition and preparation costs, and in completing the respective Ministry

of Education forms.

The steps required in the successor by-law EDC calculation and implementation process, the

opportunities for public input throughout the public consultation process and the timing of each

step, are outlined on the following page:

1-9


C. Second Public Meeting at Discretion of

Board

Overview of the Education Development Charges Process and Proposed Timelines

PHASE ONEDETERMINING

ELIGIBILITY

PHASE TWOANALYSIS

PHASE THREECONSIDERATION OF OTHER SOURCES TO

MEET THE NEEDS

PHASE FOURMINISTRY SUBMISSION

PHASE FIVEPUBLIC PROCESS

PHASE SIXBY-LAW ADOPTION

AND IMPLEMENTATION

A. Capacity Trigger Evaluation

B. EDC Reserve Fund Analysis

C. EDC Financial Obligations Evaluation

F. Apportion Costs Residential to Non-

Residential

E. Estimate Growth-Related Net Education Land Cost and Location of Site (Net of Grants,

Surplus EDC Reserves, etc.)

D. Net Growth-Related Pupil Forecast and

Number of New Sites/Acres of Land Required

C. Review Area Analysis

B. EDC Pupil Yields to Determine Average # of

New Pupils

A. Fifteen Year Estimate of Amount, Type and

Location of Residential and Non-Residential

Development

C. Conduct Review Public Meeting

D. Ministry of Education Approval

F. Notice of By-law Passage/Preparation of

EDC Pamphlet

D. By-law Adoption

C. Review of Public Submissions

B. Board Consideration of Public Input and

Revisions, as NecessaryB. Public Meeting(s)

B. Complete Background Study and Forward to MoE, Public and Co-Terminous Boards

A. Liaison with Area Municipal

Representatives re Implementation/Collection

Issues

A. Informal Public Consultation

A. Completion of Ministry Forms

C. Preparation and Distribution of Policy Review Document

B. Operating Budget Savings which could be

Applied

A. Board's Policy re Possible Public/Private Sector Partnerships to

Provide Additional Accommodation and

Statement of How Policy Implemented

E. By-law Implementation


2. OVERVIEW OF EXISTING CHARGES

2-1


2. OVERVIEW OF EXISTING CHARGES

The basis for the calculation for both of the Halton Boards’ existing schedule of education

development charges is documented in each of the Board’s Education Development Charges

Submission to the Ministry of Education dated April 22, 2004. Co-terminous boards try to

maintain consistent EDC policies to the extent possible, to facilitate defensibility of the charge,

ease of administration and collection by the area municipalities. The policy decisions made by

both Boards during the June 9, 2004 by-law adoption process and incorporated into their

respective by-laws, were consistent with one another.

2.1 Growth Forecast Assumptions

The net education capital costs and EDC calculations for the Boards were based on the

following growth assumptions for the fifteen-year forecast period:

2004-05 to 2018-19 Forecast Period

Halton Region

RESIDENTIAL:

Net New Units

62,454

NON-RESIDENTIAL:

(Net) Gross Floor Area Space (gfa)

39,330,018

2.2 EDC Pupil Yields

In addition, the Boards’ education development charge calculations were based on the

assumption respecting the number of pupils expected to be generated, per dwelling unit type, by

municipality, and by panel (elementary versus secondary) from new development.

The determination of the cumulative requirements of new development at the end of fifteen

years (i.e., the total number of pupils anticipated to be generated by new occupied dwelling

units over that time frame and reflective of the anticipated timing of new housing construction) is

based on the following weighted, blended pupil yields by dwelling unit type:

2-2


HALTON DISTRICT SCHOOL BOARD SUMMARY OF PUPIL YIELDS BY MUNICIPALITY

Burlington Oakville Milton Halton Hills

ELEMENTARY PANEL 0.1115 0.1707 0.1483 0.3672

Low Density 0.2190 0.2266 0.1697 0.5382

Medium Density 0.0916 0.1467 0.2108 0.2290

High Density 0.0148 0.0558 0.0020 0.0479

SECONDARY PANEL 0.0389 0.0840 0.0723 0.1003

Low Density 0.0864 0.0902 0.0873 0.1407

Medium Density 0.0232 0.0966 0.0824 0.0622

High Density 0.0047 0.0492 0.0006 0.0305

HALTON CATHOLIC DISTRICT SCHOOL BOARD SUMMARY OF PUPIL YIELDS BY MUNICIPALITY

Burlington Oakville Milton Halton Hills

ELEMENTARY PANEL 0.0718 0.1316 0.0992 0.1777

Low Density 0.1296 0.1741 0.1073 0.2512

Medium Density 0.0667 0.1141 0.1689 0.1317

High Density 0.0130 0.0430 0.0009 0.0260

SECONDARY PANEL 0.0280 0.0467 0.0632 0.0523

Low Density 0.0623 0.0502 0.0763 0.0734

Medium Density 0.0167 0.0538 0.0721 0.0325

High Density 0.0034 0.0274 0.0005 0.0159

2-3


2.3 Ministry-rated Capacity for EDC Purposes

In order to be in a position to consider the adoption of an EDC by-law, a school board must

meet one of two eligibility criteria as outlined below:

1. either the average elementary or secondary enrolment within the board’s jurisdiction,

over the five-year period following by-law passage, exceeds the elementary or

secondary capacity (as of by-law passage), or

2. the board can demonstrate that it has financial obligations in respect of growth-related

site acquisition needs that exceeds the current (as of by-law passage) balance in the

EDC Reserve Fund.

The basis for the Boards’ existing EDC by-laws is the comparison of enrolment to OTG capacity

(i.e., On-The-Ground), as per point #1 above contained in the EDC Guidelines.

Page 8 of the EDC Guidelines states the following:

“For the purpose of EDCs, the capacity to be used for all calculations (trigger, net new pupil places, etc.) is the current capacity (as recorded in the Ministry’s School Facilities Inventory System (SFIS)) of all operational schools of the board on the day the by-law comes into force (also known as the ‘On-The-Ground’ Capacity).”

Adjustments reflecting Ministry policy may be made in such circumstances as:

conversions of school facilities for use by a different panel (e.g., secondary to

elementary) within 12 months of by-law passage;

capacity for all schools/additions that will be available for instructional purposes within

12 months of by-law passage;

the capacity of some types of special education, adult education, or outdoor

education facilities;

the capacity of leased school facilities;

schools that have, or will be closed during the tenure of the EDC by-law.

2-4


Further, the Guidelines state that “Boards are required, in the background study, to document all

capacity adjustments made that are not consistent with the SFIS.”

Finally, a Board is required to include the number of temporary facilities (e.g., portables) in its

inventory, consistent with the most recent SFIS information.

The Ministry-rated capacity for EDC purposes which is incorporated into the existing EDC by-

laws, is outlined below.

MINISTRY-RATED CAPACITY FOR EDC ELIGIBILITY PURPOSES

Halton DSB:

EDC By-law

(June 9, 2004)1

Proposed Successor EDC

By-law (May 20, 2009)

Elementary 30,146.5 33,033.0

Secondary 16,622.0 16,410.0

TOTAL 46,769.0 49,443.0

Halton Catholic DSB:

EDC By-law

(June 9, 2004)1

Proposed Successor EDC

By-law (June 2, 2009)

Elementary 15,975.5 16,612.0

Secondary 7,884.0 9,276.0

TOTAL 23,859.5 25,888.0

For both Boards, the number of permanent classroom spaces (i.e., capacity) has, in part,

decreased due to the Provincial policy initiative of reduced primary class sizes. Changes to

permanent capacity affect the determination of the number of “available and surplus spaces,”

and therefore affect the net growth-related land needs each time that the by-law calculation is

revisited.

1 Represents permanent capacity of all bricks and mortar facility space (used for educational purposes).

2-5


2.4 Determination of Net Growth-Related Pupil Place Requirement

and Associated Site Requirements

The determination of the number of growth-related pupil places and their associated site

acquisition needs, involves five key steps.

For each review area:

1. Determine the Board’s inventory of permanent bricks and mortar space (i.e.,

OTG capacity for EDC purposes).

2. Determine the requirements of the existing community. The total OTG capacity

of all existing and proposed school facilities measured against the projected

enrolment from the existing community at the end of the forecast period,

determines whether there are any surplus pupil places available to accommodate

pupils generated by new development.

3. Determine the requirements of new development, which is the total number of

pupils generated from the units forecasted to be constructed over the fifteen-year

forecast period.

4. Determine “Net Growth-related Pupil Place Requirements,” which is the

requirements of new development less the number of available pupil places in

existing facilities.

5. Determine the need for additional school sites based on the “net growth-related

pupil place requirement,” taking into consideration situations where additions to

existing facilities, rather than new facilities, would meet the needs over the

forecast period.

2-6


The results of the analysis for the existing EDC by-laws of the Halton co-terminous Boards are

as follows:

HALTON DSB EXISTING

EDC BY-LAW

HALTON CATHOLIC DSB EXISTING EDC BY-LAW

DETERMINATION OF NET GROWTH-RELATED

PUPIL PLACES ELEMENTARY

PANEL SECONDARY

PANEL ELEMENTARY

PANEL SECONDARY

PANEL

1. Capacity 30,146.5 16,622.5 15,975.5 7,884.0

2. Projected Average Daily Enrolment of Existing Community 24,409 12,591 11,992 6,192

3. Requirements of New Development 10,742 4,602 7,215 3,022

4. Less: Available and Accessible Pupil Places 1,567 1,115 1,007 896

5. Equals: Net Growth-Related Pupil Place Requirement 9,175 3,487 6,207 2,126

2.5 Site Requirements and Valuation

The legislation requires that boards “estimate the net education land cost for the elementary/

secondary sites required to provide pupil places for the new school pupils”. O.Reg 20/98

specifies the maximum number of acres of land that can be acquired, based on the number of

pupils to be accommodated, except where:

a) the land has already been acquired by the board before February 1, 1998; or

b) there is an agreement, entered into before February 1, 1998, under which the

board is required to, or has an option to, purchase the land;

c) the land is reasonably necessary to meet a legal requirement relating to the site;

or

d) the land is necessary to allow the facilities to be located on the site and to

provide access to the site.

Both boards retained the services of the firm Royal LePage (now Cushman Wakefield LePage),

as part of the 2004 EDC background study related to their EDC by-laws. The appraisers were

requested to provide an opinion as to:

2-7


a) the appropriate land value per acre for school site acquisitions by the Halton

Catholic DSB and the Halton DSB, for expected sites within Halton Region;

b) the appropriate annual escalation factor to apply to the (current) school site value

in order to sustain the likely acquisition cost over the 15-year period.

The average per acre acquisition costs utilized to determine education land costs in the existing

EDC by-law, were as follows:

HALTON BOARDS 2004 EDC BACKGROUND REPORT

COMMUNITY

ESTIMATED VALUE (2004 $/ACRE)

Burlington $244,500 – 293,000

Halton Hills $250,000 – 271,000

Milton $279,750 – 295,500

Oakville $292,500 - 1,250,000

Average site preparation costs of approximately $45,615 per acre for elementary sites and

$89,065 per acre for secondary sites on average were applied to the overall acquisition costs

and escalated annually over the 15-year period at 3.0% per annum. In addition, land values

were escalated for each municipality per annum to the year in which the site was expected to be

purchased and are listed below. Finally, the cost of borrowing to fund the acquisition of land

was assumed to carry a 7% interest rate with a 10 year financing term.

LAND ESCALATION RATES APPLIED FOR EDC PURPOSES

COMMUNITY CONCLUDED ESCALATION RATE

Burlington 2.75%

Halton Hills 2.5%

Milton 3.25%

Oakville 3.25%

2-8


2.6 Education Development Charge Calculation

Once the boards have estimated the net education land costs to be applied, they are required to

determine the portion of the charges to be recovered from residential development and non-

residential development, having taken into consideration any positive or negative balance in the

EDC reserve fund.

A cash flow methodology was utilized to determine the quantum of the education development

charges. A cash flow methodology takes into consideration: projected revenue from the

imposition of EDCs, the projected timing of the acquisition of the sites (assumed to be at least

two years in advance of the construction of the school), associated borrowing costs, and

reserve fund interest earnings. Finally, the establishment of the EDC rate must consider

whether the boards have any operating savings that could be applied to reduce the charges. To

date, the boards have not been in a position to designate operating budget funds for the

purpose of acquiring land to meet growth-related needs. In addition, the Boards do not have in

place, any proposals for alternative accommodation arrangements (i.e., alternative

accommodation arrangements made with the public or private sector) that would serve to

reduce the charges.

2.7 Non-residential Contribution

The apportionment of net education capital costs to determine the residential education

development charge per unit and the non-residential charge per square foot was based on the

assumption that 15% of the total net education capital costs would be borne by non-residential

(industrial, institutional and commercial) development, and the remainder, or 85% would be

borne by residential development over the term of the by-law for both the Halton Catholic

District School Board and the Halton District School Board.

2.8 Education Development Charges Calculation

Finally, the following table summarizes the calculation of residential and non-residential

education development charges for the Halton DSB and the Halton Catholic DSB as

contemplated in the 2004 Background Study.

2-9


JUNE 09, 2004 EDC CALCULATION

Residential Halton

District School

Board

Halton Catholic

District School

Board

Total

Total Growth-related Net

Education Land Costs $58,482,020 $43,471,879 $101,953,899

Residential Share (85% for both

HDSB and HCDSB) $49,709,717 $36,951,097 $86,660,814

Total Net New Units 62,454 62,454 62,454

Residential Development Charge $796 $592 $1,388

Non-Residential Halton

District School

Board

Halton Catholic

District School

Board

Total

Total Growth-related Net

Education Land Costs $58,482,020 $43,471,879 $101,953,899

Non-Residential Share (15% for

both HDSB and HCDSB $8,772,303 $6,520,782 $1,906,882

Total Non Exempt G.F.A. 39,330,018 39,330,018 39,330,018

Non-Residential Development

Charge $0.22 $0.17 $0.39

The effective implementation date of both by-laws was June 14, 2004.

Post Ministry review, the following rates were subsequently adopted through by-law passage on

June 7, 2004:

Halton District School Board:

85% Residential Charge: $791.00 per unit

15% Non-Residential Charge: $0.22 per sq.ft. of gfa

Halton Catholic District School Board:

85% Residential Charge: $592.00 per unit

15% Non-Residential Charge: $0.17 per sq.ft. of gfa

2-10


Both by-laws have been amended each year since June 14, 2004 in order to reflect rising site

acquisition and development costs.


3. OVERVIEW OF EXISTING EDC POLICIES

3-1


3. OVERVIEW OF EXISTING POLICIES

This section of the report provides an overview of how the statutorily defined education

development charge policy issues were dealt with under the Halton Boards’ existing EDC by-

laws, as well as some perspectives in considering these issues for the successor EDC by-laws.

The Boards of Trustees for each board, after consideration of public input, will make decisions

on each of these policy issues prior to passage of the new EDC by-laws.

The following describes the key policy issues addressed by the Boards in their EDC by-laws,

any subsequent feedback from the municipalities, the development community, and other

interested stakeholders, as well as a description of any changes made to the policies post by-

law adoption.

3.1 Percentage of Growth-Related Net Education Land Costs to be

Borne through EDCs

Legislative Provisions:

O.Reg. 20/98, section 7, paragraphs 9 (iii) and 10 (vi), restrict a board to a maximum of 100%

recovery of the “net” growth-related education land costs. However, in deriving “net” growth-

related education land costs, there are several impediments to full cost recovery, including non-

statutory exemptions granted by the Board and statutorily-exempt residential development. The

eligible number of growth-related new pupils must be net of any available surplus capacity and

there are restrictions on the number of acres of land that a board can fund.

All Boards with EDC by-laws in place, have calculated their EDC rates to derive 100% cost

recovery of the “net” education land costs, particularly where EDC charges are applied to

residential development only.

3-2


Existing EDC By-law Provisions:

Both the HDSB’s and the HCDSB’s EDC By-laws are designed to recover 100% of the net

growth-related land costs.

Considerations:

One of the most significant changes in the legislative treatment of education development

charges is that there is no tax-based funding source to make up the shortfall where full cost

recovery is not achieved. The granting of non-statutory exemptions forces the board to absorb

the loss of revenue associated with granting the exemptions.

3.2 Jurisdiction-wide vs. Area Municipal (or Sub-area) Charges


Section 257.54 subsection (4) allows for area specific EDC by-laws by providing that “an

education development charge by-law may apply to the entire area of jurisdiction of a board or

only part of it.”

Further, the Education Act permits a board to have more than one EDC by-law under section

257.54 subsection (1) in that “If there is residential development in the area of jurisdiction of a

board that would increase education land costs, the board may pass by-laws for the imposition

of education development charges against land in its area of jurisdiction undergoing residential

or non-residential development.”

Finally, section 257.59(c) of the Education Act requires that “an education development charge

by-law shall...designate those areas in which an education development charge shall be

imposed”.

3-3



The existing “in force” EDC by-laws of the Halton District School Board and the Halton Catholic

District School Board are applied on a jurisdiction-wide basis in Halton Region. There has been

no request from the Building Industry and Land Development Association (BILD) or the local

development community stakeholders to consider anything other than a jurisdiction-wide by-law

structures in Halton Region.

This policy decision has been the subject of appeals to the Simcoe Boards’ by-laws since 1999.

In addition, there was an appeal of the Peel DSB EDC by-law in 2004 citing the application of

the by-law structure on a jurisdiction-wide basis as an appeal issue. This appeal was

subsequently withdrawn. There have been no other appeals of the question of by-law structure

decisions within the Province of Ontario. Chapter 4 of this report provides a more fulsome

discussion on the issue of by-law structure.

Considerations:

From a methodological perspective, an EDC-eligible board is required to make assumptions

respecting the geographic structure of the by-law or by-laws from the onset of the calculation

process. Discussions respecting the number of potential by-laws and the subdivision of the

boards’ jurisdictions into review areas are held with the Boards at the commencement of the

study process. If, as a result of the consultation process undertaken in contemplation of the

adoption of an EDC by-law or by-laws, the Boards choose a different policy direction, they are

usually advised by legal counsel that a new background study is required, and the calculation/

public consultation process begins anew.

3.3 Non-Statutory Residential Exemptions


Under the legislation, residential statutory exemptions include:

The enlargement of an existing dwelling unit (s.257.54 (3)(a)).

3-4


The addition of one or two units to an existing residential building where the addition is

within prescribed limits (s.257.54 (3)(b), O.Reg. 20/98 s.3).

The replacement dwelling on the same site as a dwelling unit that was destroyed (or

rendered uninhabitable) by fire, demolition or otherwise, where the building permit for the

replacement dwelling is issued two years or less after the later of the date on which the

former dwelling unit was destroyed or became uninhabitable, or a demolition permit was

issued (O.Reg. 20/98 Section (4)).

In addition, Part III, s.7.1 of O.Reg. 20/98 provides that “The board shall estimate the number of

new dwelling units in the area in which the charges are to be imposed for each of the 15 years

immediately following the day the board intends to have the by-law come into force. The

board’s estimate shall include only new dwelling units in respect of which education

development charges may be imposed.” (underlining added)

Accordingly, any costs related to students generated from units which are statutorily exempt (in

housing intensification) are not recoverable from EDCs.

Finally, an amendment to O.Reg. 20/98 enables a board to vary the EDC rates to consider

differences in size (e.g., number of bedrooms, square footage) of dwelling units or occupancy

(permanent or seasonal, non-family households or family households) although the latter (i.e.,

occupancy) could change over time.

Section 7 paragraph (9) of O.Reg. 20/98 states that “the board shall determine charges on

residential development subject to the following,

i) the charges shall be expressed as a rate per new dwelling unit,

ii) the rate shall be the same throughout the area in which charges are to be

imposed under the by-law, ...” (underlining added)

3-5


Despite this, a board may impose different charges on different types1 of residential

development, based on the percentage of the growth-related net education land costs to be

applied to residential development that is to be funded by each type. The restrictions noted

above would also apply in the case of differentiated residential EDC rates.


Neither Board’s EDC by-law provides for any non-statutory residential exemptions.

Further, there are no by-law exemptions given for units that are marketed as “adult lifestyle”.

The determination of pupils generated by new development does, however, take into

consideration the minimal occupancy of these units by school-age children.

Considerations:

From a Provincial perspective, there has only ever been one appeal of this issue. Landowners

representing the Wilmot Creek development in the Municipality of Clarington sought recognition

of the adult lifestyle nature of the community and requested exemption from the payment of

EDCs. The OMB upheld the Boards’ position2 that education services are a broader policy

tenet.

3.4 Non-Statutory Non-residential Exemptions


Non-residential statutory exemptions include:

land owned by, and used for the purposes of, a board or a municipality

1 The Spring 2002 EDC Guidelines state that “Boards may define dwelling unit types based on the nature of development and criteria that is relevant to the board (e.g., low, medium and high density; condominium/apartments, townhouses, detached houses, etc.). Boards are encouraged, where possible to rely on the categories of development used by the municipalities impacted by the EDC by-law. (Section 2.3.9.3 page 17). 2 Appeals of EDC by-laws of Kawartha Pine Ridge DSB and Peterborough Victoria Northumberland and Clarington Catholic DSB.

3-6


expansions to industrial buildings (gross floor area)1

replacement, on the same site, of a non-residential building that was destroyed by fire,

demolition or otherwise, so as to render it unusable and provided that the building permit

for the replacement building was issued less than 5 years after the date the building

became unusable or the date the demolition permit was issued

Section 7 paragraph (10) of O.Reg. 20/98 states that “if charges are to be imposed on non-

residential development ... the charges shall be expressed as ...”

a) a rate to be applied to the board-determined gross floor area of the development,

or

b) a rate to be applied to the declared value of the development.


Neither Board’s EDC by-law provides for any non-statutory non-residential exemptions.

Considerations:

If a Board elects not to have a non-residential charge, then non-statutory, non-residential

exemptions are not an issue.

There is no funding source currently available under the new funding model to absorb the cost

of providing non-statutory exemptions. In addition, by-law administration and collection of the

charge, and the ability to treat all development applications in a fair and equitable manner, are

complicated by the granting of non-statutory exemptions.

A legal opinion, sought on this matter by the consultant, suggests that a school board must

absorb the cost of exemptions voluntarily granted by the Board to any non-statutory, non-

residential development (i.e., the Board would not be in a position to make up the lost revenue

1Where the expansion to the gross floor area (gfa) is less than or equal to 50% no charge applies. Where the gfa is enlarged by more than 50% a formulaic approach is set out in Section 257.55(3) of the Education Act.

3-7


by increasing the charge on the other non-exempt, non-residential development under the

legislation).

3.5 Demolition and Conversion Credits


Section 4 of O.Reg 20/98 prescribes a replacement dwelling unit exemption.

Section 4 states that “a board shall exempt an owner with respect to the replacement, on the

same site, of a dwelling unit that was destroyed by fire, demolition or otherwise, or that was so

damaged by fire, demolition or otherwise as to render it uninhabitable.”

However, “a board is not required to exempt an owner if the building permit for the replacement

dwelling unit is issued more than two years after,

a) the date the former dwelling unit was destroyed or became uninhabitable; or

b) if the former dwelling unit was demolished pursuant to a demolition permit issued

before the former dwelling unit was destroyed or became uninhabitable, the date

the demolition permit was issued.”

Section 5 of O.Reg. 20/98 deals with exemptions for the replacement of non-residential

buildings. Similar provisions apply with respect to the replacement of non-residential gross floor

area (gfa), except that the credit is only applied to the extent that the amount of new floor space

is equivalent to the gfa of the floor space being replaced. The grace period for the replacement

of non-residential gfa is five years.

There are no legislative provisions specifically dealing with conversion of use. However, the

EDC Guidelines, section 4.1, states that, “Board by-laws may include provisions for credits for

land use conversion. Typically, this situation would arise if an EDC is paid for one type of

development and shortly thereafter (the period of time defined in the board’s EDC by-law), the

land is rezoned and a new building permit issued for redevelopment (to an alternate land use).

EDC by-laws may include provisions for providing credits in this situation to take into account

3-8


the EDC amount paid on the original development (generally by offsetting the EDC amount

payable on the redevelopment)” (underlined wording added for further clarification).


Both Board’s EDC by-laws provide for a two-year grace period on residential building permits

and a 5-year period on non-residential building permits. No exemptions are granted for

conversion of use.

Considerations:

Most of the existing EDC by-laws in place provide for a 5-year grace period in respect of

residential and non-residential building permits for replacement dwelling units. In addition, most

EDC by-laws provide conversion credits limited to the amount of the education development

charges originally paid in respect of the land in question.

3.6 Percentage of Net Education Land Costs to be Borne By

Residential and Non-residential Development


Section 257.54(1) of the Education Act provides that a board may pass an EDC by-law “against

land in its area of jurisdiction undergoing residential or non-residential development,” if

residential development in the board’s jurisdiction would increase education land costs.

Section 7 paragraph 8 of O.Reg. 20/98 requires that, “the Board shall choose the percentage of

the growth-related net education land cost that is to be funded by charges on residential

development and the percentage, if any, that is to be funded by charges on non-residential

development.” (underlining added) “The percentage that is to be funded by charges on non-

residential development shall not exceed 40 percent.”

A board has the choice under the Education Act, of levying an EDC only on residential

development (for partial or full eligible cost recovery), or levying a charge on both residential

3-9


and non-residential development (up to a maximum of 40% of costs allocated to non-residential

development). Under the previous DCA legislation, a charge on non-residential development

(then termed “commercial” development) was required.


Both Board’s by-laws are designed to recover 85% of the net education land costs from

residential development, with the residual, or 15% from non-residential development.

Considerations

For most of the current EDC by-laws, 10-15% of net growth-related education costs were

funded by non-residential development. This percentage was specifically requested by a

majority of the development community stakeholders during the public consultation process,

where the residential EDC rates are higher than the norm.

3.7 By-law Term


The Education Act permits a school board to pass an EDC by-law with a maximum term of five

years. (s.257.58 (1))

A board with an EDC by-law in force, may pass a new EDC by-law at any time, after preparing a

new education development charge study, securing Ministry approval, and undertaking the

required public process. (s.257.58 (2))

A board may amend an EDC by-law once in each one-year period following by-law enactment,

to do any of the following:

“1. Increase the amount of an education development charge that will be payable in any particular case.

2. Remove, or reduce the scope of, an exemption.

3-10


3. Extend the term of the by-law.” (s.257.70(2) and subject to s.257.58(1))

A public meeting is not required for a by-law amendment; however, the board must give notice

of the proposed amendment, in accordance with the regulations, and make available to the

public, the EDC background study for the by-law being amended, and “sufficient information to

allow the public to generally understand the proposed amendment.” (s.257.72)


Each Board’s EDC by-law carries a maximum in force term of five years.

3.8 Application of Operating Surpluses to Capital Needs


The education development charge background study must include “a statement from the board

stating that it has reviewed its operating budget for savings that could be applied to reduce

growth-related net education land costs, and the amount of any savings which it proposes to

apply, if any.”

The Regulation requires that this issue be addressed by a quorum of the board.

The use of the expression, “if any,” recognizes that even if there is a surplus, the board may not

choose to direct it to this particular form of expenditure.

The Province’s Funding Model prescribes “envelopes” which impact on the direction of

budgetary surpluses, including the requirement that funds may not be moved from the

classroom to non-classroom category; funds generated by special education needs cannot be

used for other purposes; funds generated from grants for new pupil places or renewal must be

used for this purpose or placed in a reserve fund for future use.1 Only funds generated from the

1However, funds may be used to acquire school sites as part of a school facilities acquisition under O.Reg. 446/98.

3-11


School Board Administration and Governance, Transportation and School Operations grants

may be directed elsewhere (and therefore could be potentially used for education land costs).

A copy of each board’s existing policy can be found in Appendices C and D, respectively.

3.9 Policy on Alternative Accommodation Arrangements


Information which must be included in the education development charge background study

includes, “A statement of the board’s policy concerning possible arrangements with

municipalities, school boards or other persons or bodies in the public or private sector, including

arrangements of a long-term or co-operative nature, which would provide accommodation for

the new elementary school pupils and new secondary school pupils...without imposing

education development charges or with a reduction in such charges.” (section 9(1) paragraph 6

of O.Reg 20/98)

For a subsequent EDC by-law period, the board is further required to provide a “statement of

how the policy...was implemented and, if it was not implemented, an explanation of why it was

not implemented.”

The legislation would appear to contemplate situations where the “arrangements” include

consideration for both land and buildings.

The impact on the Boards’ permanent capacity (particularly in the situation of a long-term

leasing arrangement) would have to be considered as part of the needs assessment inherent in

the EDC calculation.

If “other persons”1 were to enter into these arrangements with school boards, they would be

potentially spreading the benefit of the arrangement across all development, as opposed to a

landowner entering into a services-in-lieu agreement, which would provide the applicant with a

credit against EDCs payable.

1Other than those paying EDCs (e.g. municipalities, corporations, endowments, etc.)

3-12


The pupil accommodation reserve fund can be utilized to enter into long and short term lease

arrangements with the private sector, or to enter into multi-use partnership agreements within

other school boards, municipalities or the private sector.

Section 110 (12) of the Municipal Act permits school boards to provide limited exemptions from

municipal and school taxes and education development charges in exchange for the provision

of school capital facilities, under certain circumstances.

A copy of each board’s existing policy on alternative accommodation arrangements can be

found in Appendices C and D, respectively.

3.10 Collection of Education Development Charges


Sections 257.80 and 257.81 of Division E of the Education Act states that “an education

development charge is payable upon a building permit being issued” and “…payable to the

municipality issuing the building permit.”


Sections 17 and 18 of each Board’s by-law specify that:

“The education development charge in respect of a development is payable to the Municipality on the date that the first building permit is issued in relation to a building or structure on land to which the education development charge applies. All education development charges payable shall be paid by cash, by certified cheque or by bank draft.”

Considerations:

During the August, 2008 EDC by-law adoption process for the Toronto Catholic DSB, the

Building Industry and Land Development Association requested that the Board approve

transitional collection procedures. The Board approved the “grandfathering” of building permit

3-13


applications submitted to the City of Toronto prior to June 30, 2008 to allow those building

permits to pay the old EDC rates.


4. EDC BY-LAW STRUCTURE

4-1


4. EDC BY-LAW STRUCTURE This section of the report deals with the policy decision of a school board to adopt jurisdiction-

wide or one or more area-specific education development charge by-laws. Both by-law

structures are permitted under the legislation.


The Education Act permits a board to have more than one EDC by-law under section 257.54 (1)

in that “if there is residential development in the area of jurisdiction of a board that would

increase education land costs, the board may pass by-laws for the imposition of education

development charges against land in its area of jurisdiction undergoing residential or non-

residential development.”

Section 257.54 (4) further permits area specific by-laws in that “an education development

charge by-law may apply to the entire jurisdiction of a board or only part of it.” The Board is

required to designate the charging “area” in the contents of the by-law (section 257.59 (c)).

The predecessor legislation, the Development Charges Act, 1989, required the creation of area

specific EDC by-laws in that co-terminous boards, whose jurisdictions only partially overlapped,

were required to establish common EDC accounts (i.e., one for residential collections and one

for non-residential collections) for contiguous areas of by-law application. The existing

legislation removes the requirement for shared accounts, and tries to recognize common

charging areas through the establishment of “regions” under section 257.57 of the Education

Act. Even so, a board is entitled to have more than one area-specific by-law within each

“region,” where established, or within the board’s jurisdiction, where “regions” were not

established.

Section 259.57 of the Education Act stipulates that an EDC by-law shall not apply to more than

one region where the regulations divide a board’s jurisdiction into multiple regions. Moreover,

monies collected within one region may not be spent in another without the Minister’s

permission.

4-2


Where a board chooses to adopt multiple area-specific by-laws within a region, the EDC funds

collected must be spent on “growth-related net education land costs attributed to or resulting

from development in the area to which the EDC by-law applies”1 (underlining added). A board

may borrow from one by-law area to another on an interim basis, but it must repay the amount

borrowed plus interest at a rate specified in the legislation. It is not possible under the

legislation to borrow from one by-law area to another indefinitely. Moreover, if repayment by the

borrowing area is not fully made until the last by-law period, then the borrowing area must

recoup the amount of funds borrowed from a limited number of development units. Delaying the

repayment of the borrowed funds places the burden of repayment on units that may not have

generated the need in the first place.


There are twenty-eight “in-force” EDC by-laws in the Province of Ontario and only three are

singular, area-specific by-laws. For each of the area-specific by-laws there is a singular,

geographically defined portion of the jurisdiction experiencing enrolment growth (and requiring

additional land). In each case, the lands experiencing growth are urban in designation, and

separated from other urban areas by vast expanses of rural lands (e.g., extensive rural divide

between the Town of Clarington and the City of Peterborough and between the City of Kingston

and the Town of Napanee). There are no growth-related site needs outside of the by-law area.

Moreover, the non-charging area does not benefit from the construction of new schools within

the by-law area, largely due to distance. As well, the pupils generated by new development are

proposed to be accommodated within the by-law area, not outside of it. Finally, the distinction

between areas of need and areas of no need is not expected to change during the fifteen-year

forecast period or beyond. Area-specific by-law structures are typically recommended by the

consultants where the foregoing conditions exist in an area within a board’s jurisdiction.

The application of multiple area-specific by-laws (and there are none of these in the Province of

Ontario) would only be recommended where the following circumstances apply:

there is considerable distance between the by-law areas and the lands between have

few, if any, pupils (i.e., there is no potential for cross boundary attendance); and

1 Section 16(2) of O.Reg. 20/98.

4-3


future growth patterns are known and there is no potential that the future growth will

conjoin the pupil attendance boundaries of the independent area-specific by-law areas.

In jurisdictions where enrolment growth occurs in several parts of the jurisdiction, jurisdiction-

wide by-law structures are preferred over multiple area-specific by-laws for several reasons:

1. Jurisdiction-wide by-law structures guarantee full cost recovery. That is, 100% of net

growth-related land needs are funded regardless of the timing and location of

development. There are no constraints to redirecting EDC funds to anywhere within the

jurisdiction under this by-law structure.

2. Full cost recovery is ensured even if land costs are higher than predicted, but because it

is an averaging exercise, the impact of the cost increase is lower (i.e., spread over more

units and gfa).

3. The larger the charging area and the number of sites, the better the opportunity to

spread the risk in the averaging exercise. Also, this reduces borrowing costs and

ultimately the cost to land owners to develop land.

4. A jurisdiction-wide by-law structure provides the flexibility to accommodate pupils where

and when required, given a changing student accommodation environment which is

driven, in part, by changing Provincial policies. Shifts in apportionment between boards

can be dealt with more readily under this by-law structure. In addition, a jurisdiction-wide

by-law structure ensures that accommodation decisions determine changes to the by-

law needs, not the other way around.

5. This approach is consistent with the implementation of each Board’s capital program and

its education service delivery, which is not differentiated by particular service areas. It is

also consistent with the basis for determining EDC eligibility which is on a jurisdiction-

wide basis.

6. A singular by-law structure is easier to administer for school boards and municipalities in

that it negates the requirement to determine which side of the street is contained within

the charging area. Where only one side of the street falls within the charging area, the

4-4


recovery scheme may be deemed inequitable by those who are required to pay the

charge.

7. A jurisdiction-wide by-law ensures that a board is not put in a situation of trying to fund

growth-related land needs generated outside of the by-law area. Where this occurs,

boards would be forced to move the by-law boundaries to chase the growth. Where

building permits have already been issued in respect of this new growth area, then a

funding shortfall occurs as the by-law can only be applied at building permit issuance.

Moreover, constantly revisiting the EDC by-law (i.e., a by-law amendment would not

suffice under these circumstances) is unreasonable, time consuming and costly.

8. If EDC monies are collected to fund growth-related land needs within the by-law area,

but the students are subsequently accommodated outside of the by-law area, there is no

ability to redirect (i.e., spend) these funds outside of the by-law area. The funds are

stranded in the area in which they were collected and serve to reduce the successor by-

law charge.


5. SUMMARY OF BY-LAW PROVISIONS, APPEALS,

AMENDMENTS AND COMPLAINTS

5-1


5. SUMMARY OF BY-LAW PROVISIONS, APPEALS,

AMENDMENTS AND COMPLAINTS

5.1 Summary of By-law Provisions

This section of the report presents a broad summary of the Halton Boards Education

Development Charge By-laws for purposes of conveying a general understanding of the by-laws

to the public as part of this policy review. It is not intended to alter or interpret the meaning of

the by-laws in any way (the full text of the Halton District School Board’s and the Halton Catholic

District School Board’s EDC By-Laws are contained in Appendices A and B, respectively.

The existing Education Development Charge By-laws for the co-terminous Halton Boards,

governing Halton Region, include the following key provisions:

Lands Affected – Section 3 of both the Halton DSB and Halton Catholic DSB by-laws

indicate that the by-law applies to all lands in Halton Region, but not to lands that are

“owned by and are used for the purposes of”:

“(a) the Region or a local board thereof;

(b) a municipality or local board thereof;

(c) a board as defined in section 257.53(1) of the Act;

(d) a public hospital receiving aid under the Public Hospitals Act R.S.O.

1990,c:p40;

(e) a publicly-funded university, community college or a college of applied

arts and technology established under the Ministry of Colleges and

Universities Act, or a predecessor statute;

(f) a seminary of learning maintained for educational purposes that is

exempt from taxation under the Assessment Act, the whole profits from

which are devoted or applied to such purposes;

(g) a place of worship owned by religious organization that is exempt from

taxation under the Assessment Act that is used primarily as a place of

public worship;

5-2


(h) a cemetery or burying ground that is exempt from taxation under the

Assessment Act;

(i) The Toronto Area Transit Operating Authority (“Go Transit”); and

(j) agricultural buildings or structures that are owned by and used for the

purposes of a bona fide farming operation.

Calculation of Charge – Section 9 of the HDSB and HCDSB by-law specifies the

residential rates. Section 12 specifies the non-residential rates.

Timing of Payment – Section 16 of both the HDSB and HCDSB by-laws specify that the

EDC is payable in full to the municipality in which the development takes place on the

date that a building permit is issued in relation to a building or structure.

Redevelopment Conversion Credit – Sections 11 and 14 of the by-laws explains the

basis on which an exemption would apply in the case of the replacement of a building or

structure.

Effective and Expiry Dates - Section 20 of the by-laws states that the by-law “shall come

into force on June 14, 2004” and Section 21 of the by-laws states that the by-law “shall

expire five (5) years after the date they comes into force, unless it is repealed at an

earlier date.”

5-3


5.2 Inter Board Comparison of EDC Rates

A summary of in-force rates for each of the Boards with EDC by-laws in place and the

residential and non-residential rates imposed under those by-laws as of November, 2008, is

shown below.

BoardEffective Date

of By-lawBy-law Term

Area to which By-law Applies

Res. Charge/

Unit

Non-Res. Charge/ Sq. Ft. of G.F.A.

% of Charge Attributed to Residential

Development

% of Charge Attributed to

Non-Residential Development

1Algonquin & Lakeshore Catholic DSB

Oct. 2007 5 years City of Kingston $74 $0.00 100% 0%

2Brant Haldimand Norfolk Catholic DSB

Nov. 2008 5 yearsCity of Brantford, County of Brant

$628 $0.00 100% 0%

3

Conseil de district des écoles publiques de langue française n°59

Nov. 20044 years & 7.5

monthsCity of Ottawa $68 $0.02 90% 10%

4

Conseil des écoles catholiques de langue française du Centre-Est

Oct. 20044 years & 9

monthsCity of Ottawa $41 $0.03 75% 25%

5 Dufferin-Peel Catholic DSB May 2006 5 years Peel Region $536 $0.23 75% 25%

6Durham Catholic DSB July 2004 5 years

Durham Region (excl. Clarington)

$337 $0.00 100% 0%

7Durham DSB July 2004 5 years

Durham Region (excl. Clarington)

$958 $0.00 100% 0%

8English-language Separate DSB No 38 (London CDSB)

Sept. 2005 5 years City of London $379 $0.00 100% 0%

9 Greater Essex County DSB July 2008 1 year City of Windsor $190 $0.00 100% 0%

10Greater Essex County DSB July 2008 1 year

County of Essex and the Township of Pelee

$180 $0.00 100% 0%

11 Halton Catholic DSB June 2007 5 years Halton Region $839 $0.24 85% 15%12 Halton DSB June 2007 5 years Halton Region $1,260 $0.35 85% 15%

13Hamilton-Wentworth Catholic DSB

Sept. 2004 5 years City of Hamilton $307 $0.11 85% 15%

14 Kawartha Pine Ridge DSB July 2005 5 years Clarington $835 $0.29 90% 10%15 Ottawa-Carleton Catholic DSB July 2004 5 years City of Ottawa $367 $0.27 74% 26%

16Ottawa-Carleton DSB Sept. 2004

4 years & 10 months

City of Ottawa $518 $0.19 85% 15%

17 Peel DSB March 2008 5 years Peel Region $1,605 $0.23 90% 10%

18

Peterborough, Victoria, Northumberland & Clarington Catholic DSB

May 2005 5 years Clarington $364 $0.13 90% 10%

19Simcoe Muskoka Catholic DSB Nov. 2008 5 years Simcoe County $370 $0.08 90% 10%

20 Simcoe County DSB Nov. 2008 5 years Simcoe County $718 $0.15 90% 10%21 Toronto Catholic DSB Aug. 2008 5 years City of Toronto $544 $0.58 75% 25%22 Upper Grand DSB Sept. 2004 5 years Dufferin County $188 $0.00 100% 0%23 Upper Grand DSB Sept. 2004 5 years Wellington County $618 $0.00 100% 0%

24Waterloo Catholic DSB July 2006 5 years

Regional Municipality of Waterloo

$112 $0.00 100% 0%

25Waterloo Region DSB July 2006 5 years

Regional Municipality of Waterloo

$637 $0.00 100% 0%

26 Wellington Catholic DSB Sept. 2004 5 years Wellington County $453 $0.00 100% 0%27 York Catholic DSB July 2004 5 years York Region $477 $0.07 90% 10%28 York DSB July 2004 5 years York Region $1,193 $0.19 90% 10%

Note: Updated February 2009 by Watson & Associates Economists Ltd. S:\edc-gen\[EDC Rates by Board.xlsx]EDCs

5-4


5.3 Appeals, Amendments and Complaints

5.3.1 Appeals

Under Section 257.65 of the Education Act, “any person or organization may appeal an

education development charge by-law to the Ontario Municipal Board by filing with the secretary

of the board that passed the by-law, a notice of appeal setting out the objection to the by-law

and the reasons supporting the objection.”

There were no appeals of the Halton District School Board and Halton Catholic District School

Board EDC by-laws.

5.3.2 Amendments


Section 257.70 subsection (1) states that “subject to subsection (2), a board may pass a by-law

amending an education development charge by-law.”

Subsection (2) goes on to say that “a board may not amend an education development charge

by-law so as to do any one of the following more than once in the one-year period immediately

following the coming into force of the by-law or in any succeeding one-year period:

1. Increase the amount of an education development charge that will be payable in

any particular case.

2. Remove, or reduce the scope of, an exemption.

3. Extend the term of the by-law.”

Section 257.71 states that “A by-law amending an education development charge by-law comes

into force on the fifth day after it is passed.”

Finally, “before passing a by-law amending an education development charge by-law, the board

shall,

5-5


a) give notice of the proposed amendment in accordance with the regulations; and

b) ensure that the following are made available to the public,

i) the education development charge background study for the by-law being

amended, and

ii) sufficient information to allow the public to understand the proposed

amendment.”

Both the HDSB and the HCDSB have in place Board policies requiring the Superintendent of

Business to report annually on the ability of the existing EDC by-law to fund ongoing education

land costs and to prepare amendments to the by-law for Board consideration as necessary.

Both Boards have amended their EDC by-laws every year since implementation of the by-laws

in July, 2004.

5.3.3 Complaints

Under Section 257.85 of the Education Act, “an owner, the owner’s agent or a board, may

complain to the council of the municipality to which an education development charge is payable

that,

a) the amount of the education development charge was incorrectly determined;

b) a credit is or is not available to be used against the education development

charge, or that the amount of a credit was incorrectly determined;

c) there was an error in the application of the education development charge by-law

In addition, “A complaint may not be made...later than 90 days after the day the education

development charge, or any part of it, is payable.”

There were no complaints filed against either by-law.


6. TRANSITIONAL EDUCATION DEVELOPMENT CHARGE

RESERVE FUND REPORTING

6-1


6. TRANSITIONAL EDUCATION DEVELOPMENT CHARGE

RESERVE FUND REPORTING

6.1 Establishment of an Education Development Charge

Reserve Fund

Section 257.82 of the Education Act states that “a board that has passed an education

development charge by-law shall establish reserve funds in accordance with the regulations.”

Part V of O.Reg 20/98 section 16(1) further states that “a board shall, under section 257.82 of

the Act, establish an education development charge reserve fund for the area to which an

education development charge by-law applies.” Sub-section 16(2) goes on to say that “money

from an education development charge reserve fund established under subsection (1) may be

used only,

a) for growth-related net education land costs, attributed to or resulting from,

development in the area to which an education development charge by-law

applies;

b) as provided for under clause 241 (1) (a) or section 257.99 of the Act;

c) to pay for the reasonable costs of preparing, revising and distributing the

pamphlet for the by-law as required under section 21;

d) to pay the service charges of a financial institution relating to the reserve fund; or

e) if an education development charge has been paid but the building permit for the

development is revoked, to refund the education development charge plus

interest at a rate not exceeding the rate prescribed under section 18."

Section 16.1 of O.Reg. 20/98 requires a board to establish an education development charge

reserve where the proceeds of a sale, lease or other disposition of real property is attributed to a

portion of the property that was originally funded from an EDC reserve fund.

6-2


Section 257.82 sub-section (2) stipulates that “a municipality that receives an education

development charge shall deposit the charge in the appropriate education development charge

reserve fund not later than the 25th day of the month after the month in which the charge has

been paid”. As section 257.85 of the Education Act also enables “an owner, the owner’s agent,

or a board”, to complain to the council of the municipality to which an education development

charge was payable, the board must act within 90 days of the education development charge, or

any part of it, being paid. The complaint provisions enable the board to file a complaint (in

writing) to the municipality, if the charge was incorrectly applied, or if there was an error in the

application of the by-law.

Section 257.90 of the Education Act deals with refunds to be paid from the education

development charge reserve fund (plus applicable interest), “if an education development

charge that has already been paid is reduced by the council of a municipality under section

257.85 or by the Ontario Municipal Board under section 257.89" (appeal of the by-law or by-law

amendment to the OMB).

6.2 Reserve Fund Reporting Requirements

Section 257.98 of the Education Act requires that “the treasurer of a board shall each year on or

before such date as the board may direct, give the board a financial statement relating to

education development charge by-laws and education development charge reserve funds.” “A

statement must include, for the preceding year, statements of the opening and closing balances

of the education development charge reserve funds and of the transactions relating to the

reserve funds and other such information as is prescribed in the regulations” (underlining

added). “The treasurer shall give a copy of a statement to the Minister within 60 days after

giving the statement to the board.”

The regulations which accompany Part IX Division E of the Education Act do not specify “other

information” to be included in the reserve fund statement. In lieu, the Ministry requires that all

boards with EDC by-laws in place submit a detailed reserve fund statement as part of the

financial reporting to the Ministry, in the boards’ annual Financial Statements (Appendices D1

and D2). The Financial Statements of the boards are typically approved by the board of

trustees and submitted to the Minister in November of each year. Details on the education

development charge reserve fund will have been incorporated into the boards’ Financial

6-3


Statements since the 2002/03 fiscal year. However, it is noted that Reserve Fund Continuity

Statements are reported fiscal period to fiscal period, whereas the EDC transitional reserve fund

analysis is based on the period between by-law inception and the implementation date of the

proposed successor by-law. Moreover, the legislation requires that a school board estimate the

balance in the EDC reserve fund. Therefore, the EDC transitional analysis makes an

adjustment for the actual balance of the previous by-law period.

6.3 Status of the HDSB and HCDSB EDC Reserve Fund

A statement of collections to January 31, 2009, interest earnings, and refunds given, is provided

on the following pages. An estimate of total EDC revenue to by-law expiry, along with eligible

EDC site expenditures, can be found in the Boards’ April 9, 2009 EDC Background Study

Report.

6-4


HALTON DISTRICT SCHOOL BOARDEDUCATION DEVELOPMENT CHARGES BY-LAW

EDC RESERVE FUND RECONCILIATION - REVENUE

EDC BY-LAW PERIODS September 1, 1999 to June 14, 2004 and June 15, 2004 to January 31, 2009EDCs from Residential

Development

EDCs from Non-Residential

Development Interest EarnedLess Interest

Expense

Less Refunds and

Overpayments

Proceeds of Disposition

(EDC Portion) Total RevenueA Estimated Collections September 1, 1999 to June 14, 2004:

1 Carried forward from June 1996 - August 1999 EDC by-law period $2,093,646

2EDC By-law Collections September 1, 1999 to December 31, 2003 (as per EDC Background Study Report April 22, 2004) 18,342,252$ 2,044,172$ 511,216$ (13,753)$ 20,883,887$

3Estimated Collections January 1, 2004 to June 14, 2004 (as per April 22, 2004 EDC Background Study Table 8-7) 2,500,000$

Sub-totals 25,477,533$

B Actual Collections September 1, 1999 to June 14, 2004

1 Carried forward from June 1996 - August 1999 EDC by-law period $2,093,646

2EDC By-law Collections September 1, 1999 to December 31, 2003 (as per EDC Background Study Report April 22, 2004) 20,883,887$

3 Actual Collections January 1, 2004 to June 14, 2004 3,211,911$ 444,032$ 121,462$ -$ (2,792)$ 3,774,613$


4 Net Difference Carried forward: 1,274,613$

C Actual Collections June 15, 2004 to January 31, 2009:

1 EDC Reported Collections June 15, 2004 to August 31, 2004 681,781$ 379,597$ 45,615$ -$ -$ 1,106,993$

2 EDC Reported Collections Sept 1, 2004 to August 31, 2005 3,922,736$ 589,842$ 200,695$ -$ (1,072)$ 1,250,177$ 5,962,378$

3 EDC Reported Collections Sept 1, 2005 to August 31, 2006 4,096,386$ 915,499$ 197,889$ (1,153)$ (156)$ 5,208,465$

4 EDC Reported Collections Sept 1, 2006 to August 31, 2007 5,526,894$ 1,717,498$ 146,868$ (44,629)$ 7,346,631$

5 EDC Reported Collections Sept 1, 2007 to August 31, 2008 7,072,882$ 1,288,226$ 123,943$ (316,815)$ 8,168,236$

6 EDC Reported Collections Sept 1, 2008 to January 31, 2009 1,242,589$ 38,441$ -$ (91,178)$ (1,151)$ 1,188,701$

Total Collections to Include in EDC RF Transitional Analysis 30,256,017$

S:\HDSB-HCDSB 2009 EDC BY-LAW RENEWAL\HDSB 2009 EDC\Reserve Fund\[HDSB - EDC ANAYSIS - FINAL APRIL 6.xls]Revenues

6-5


HALTON CATHOLIC DISTRICT SCHOOL BOARDEDUCATION DEVELOPMENT CHARGES BY-LAW

EDC RESERVE FUND RECONCILIATION - REVENUE

EDC BY-LAW PERIODS September 1, 1999 to June 14, 2004 and June 15, 2004 to January 31, 2009EDCs from Residential

Development

EDCs from Non-Residential

Development Interest Earned

Less Refunds and

Overpayments Total RevenueA Estimated Collections September 1, 1999 to June 14, 2004:

1 Carried forward from June 1996 - August 1999 EDC by-law period $0

2EDC By-law Collections September 1, 1999 to December 31, 2003 (as per EDC Background Study Report April 22, 2004) 503,652$ (8,492)$ 16,543,721$

3Estimated Collections January 1, 2004 to June 14, 2004 (as per April 22, 2004 EDC Background Study Table 8-7) 2,000,000$


B Actual Collections September 1, 1999 to June 14, 2004

1 Carried forward from June 1996 - August 1999 EDC by-law period $0

2EDC By-law Collections September 1, 1999 to December 31, 2003 (as per EDC Background Study Report April 22, 2004) 16,543,721$

3 Actual Collections January 1, 2004 to June 14, 2004 1,965,897$


4 Net Difference Carried forward: (34,103)$

C Actual Collections June 15, 2004 to January 31, 2009:

1 EDC Reported Collections June 15, 2004 to May 31, 2005 3,595,209$ 537,215$ 4,132,424$


3 EDC Reported Collections June 1, 2006 to May 31, 2007 3,541,987$ 1,118,522$ 4,660,509$


5 EDC Reported Collections June 1, 2008 to January 31, 2009 2,133,172$ 436,915$ (4,384)$ 2,565,703$

Total Collections to Include in EDC RF Transitional Analysis 16,607,239$ 3,500,736$ -$ (4,384)$ 20,073,872$

S:\HDSB-HCDSB 2009 EDC BY-LAW RENEWAL\HCDSB 2009 EDC\Reserve Fund\[Reserve Fund Calculation.Final Table 8-4. xls.xlsx]Revenues

Watson & Associates Economist Ltd. S:\HDSB-HCDSB 2009 EDC BY-LAW RENEWAL\reports\Halton DSB & CDSB Policy Review Report April 2009.docx

APPENDIX A

HALTON DISTRICT SCHOOL BOARD –

EDC BY-LAW ADOPTED JUNE 9, 2004

A-1


A-2


A-3


A-4


A-5


A-6


A-7


A-8


A-9


A-10


A-11



APPENDIX B

HALTON CATHOLIC DISTRICT SCHOOL BOARD –

EDC BY-LAW ADOPTED JUNE 9, 2004

B-1


B-2


B-3


B-4


B-5


B-6


B-7


B-8


B-9


B-10


B-11


B-12



APPENDIX C

EXISTING BOARD POLICIES

- APPLICATION OF OPERATING SURPLUSES

- APPLICATION OF ALTERNATIVE ARRANGEMENTS


HALTON DISTRICT SCHOOL BOARD

C-1


C-2



HALTON CATHOLIC DISTRICT SCHOOL BOARD

C-3


C-4


C-5


C-6


BACKGROUND DOCUMENT PERTAINING TO A REVIEW OF THE … · 2014-07-07 · & CDSB Policy Review Report...

Documents

Transcript of BACKGROUND DOCUMENT PERTAINING TO A REVIEW OF THE … · 2014-07-07 · & CDSB Policy Review Report...