A developer is taking the City of West Kelowna to court to dispute a $700,000 charge the developer alleges was forced upon them.
Ironclad Developments handles the building project on 3623 Elliott Road in West Kelowna. Ironclad is building four multi-family residential apartment buildings for 193 units and is now known as Lakeview Pointe Apartments.
According to court documents, around Nov. 22, 2018, the city told Ironclad it needed to pay a “latecomer fee,” which a civil engineer estimated to be $397,796.69.
Initial developers often have to pay for infrastructure costs, but following developers will sometimes have to pay latecomer fees. Municipalities use the fees to offset costs of off-site infrastructure deemed necessary for the development to proceed.
In this case, the off-site infrastructure was construction on Gossett Road, just off Elliott Road, where Lakeview Pointe Apartments stand.
Around May 5, 2020, the city gave Ironclad a notice stating that the latecomer fee was actually $962,851.22. A day later, Ironclad disputed the costs and requested copies of the documentation so they can investigate.
“The city refused, failed and/or neglected to respond to Ironclad’s request of May 6, 2020, and did not provide the information request,” court documents state.
Ironclad made a similar request in July 2020, but the city once again did not respond. By November, the city had the matter reviewed by a quantity surveyor. The surveyor said the latecomer fee for Ironclad actually stood at $749,660.40.
Documents show Ironclad’s concerns were that they didn’t receive a response from the city when they asked for documentation, they didn’t get the chance to provide feedback on the fee increase, and they weren’t shown what the increased latecomer fees were based on.
Ironclad paid the fees by the end of November but with their court petition, the developer wants the City of West Kelowna to return the $749,660.40 for the city to reconsider the latecomer charge and for it to provide them with the documentation for the decision.
The City of West Kelowna has not responded to the petition yet, and none of the allegations have been proven in court.