The cost of building in Kelowna is going up.
Kelowna city council has given initial approval to an increase to what are known as development cost charges, fees developers pay the city to help cover the cost of public amenities such as roads, sewer, water and drainage associated with their projects.
The proposed increases, which vary according to what services are required and where in the city the development is being built, range from a high of 14 per cent in the south Mission to a low of 4.8 per cent north of the inner city, said infrastructure planning manager Joel Shaw. The increase in DCC’s for buildings in the inner city area will be 9.3 per cent.
The city, which has already heard from the Urban Development Institute, an association that represents developers, plans to hold meetings with both developers and the public at the end of the month to gather more input.
As expected, the development community is not happy with the planned increases and has written to the city to say so. The UDI says the DCC increase could impact growth in the city.
Some councillors expressed concern about the size of the increase, suggesting linking future increases to the cost of living via the Consumer Price Index.
Coun. Luke Stack said that approach may be better than large increases few years.
He said the development community needs numbers it can rely on and smaller increases could likely be handled more easily.
The last time the city changed its DCCs was in 2011 when it decreased them because of the faltering local economy. That change was made in conjunction with a review of the city’s official community plan.
Shaw said city staff recognizes five years is too long to go without a DCC review and it is looking at shortening the review gap to every two years.
He defended the planned increases, saying they reflect current market conditions and added Kelowna’s DCC rate is comparable with similar sized cities across the province.
According to Shaw, any development in stream before the bylaw to amend the DCCs comes into force at the end of April or in early May will be protected at the current rate for one year.
Because of that, Shaw said he expects to see a flood of development applications in the next month as developers try to get their projects in under the wire.